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Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
☒          QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2021
or
☐          TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from    to
Commission File Number: 1-33409
TMUS-20210630_G1.JPG
T-MOBILE US, INC.
(Exact name of registrant as specified in its charter)
Delaware 20-0836269
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)

12920 SE 38th Street
Bellevue, Washington
(Address of principal executive offices)
98006-1350
(Zip Code)
(425) 378-4000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol Name of each exchange on which registered
Common Stock, par value $0.00001 per share TMUS The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☒ Accelerated filer ☐
Non-accelerated filer ☐ Smaller reporting company
☐
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).      Yes ☐ No ☒
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Class Shares Outstanding as of July 28, 2021
Common Stock, par value $0.00001 per share 1,247,966,318 



1

T-Mobile US, Inc.
Form 10-Q
For the Quarter Ended June 30, 2021

Table of Contents
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2
Index for Notes to the Condensed Consolidated Financial Statements
PART I. Financial Information
Item 1. Financial Statements

T-Mobile US, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(in millions, except share and per share amounts) June 30,
2021 		December 31,
2020
Assets
Current assets
Cash and cash equivalents $ 7,793  $ 10,385 
Accounts receivable, net of allowance for credit losses of $123 and $194
4,528  4,254 
Equipment installment plan receivables, net of allowance for credit losses and imputed discount of $482 and $478
4,064  3,577 
Accounts receivable from affiliates 18  22 
Inventory 1,707  2,527 
Prepaid expenses 818  624 
Other current assets 1,642  2,496 
Total current assets 20,570  23,885 
Property and equipment, net 39,752  41,175 
Operating lease right-of-use assets 27,511  28,021 
Financing lease right-of-use assets 3,072  3,028 
Goodwill 11,152  11,117 
Spectrum licenses 82,917  82,828 
Other intangible assets, net 4,600  5,298 
Equipment installment plan receivables due after one year, net of allowance for credit losses and imputed discount of $115 and $127
2,284  2,031 
Other assets 12,266  2,779 
Total assets $ 204,124  $ 200,162 
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable and accrued liabilities $ 8,411  $ 10,196 
Payables to affiliates 105  157 
Short-term debt 4,648  4,579 
Short-term debt to affiliates 2,235  — 
Deferred revenue 939  1,030 
Short-term operating lease liabilities 3,577  3,868 
Short-term financing lease liabilities 1,045  1,063 
Other current liabilities 877  810 
Total current liabilities 21,837  21,703 
Long-term debt 65,897  61,830 
Long-term debt to affiliates 2,490  4,716 
Tower obligations 2,919  3,028 
Deferred tax liabilities 10,391  9,966 
Operating lease liabilities 26,515  26,719 
Financing lease liabilities 1,376  1,444 
Other long-term liabilities 5,229  5,412 
Total long-term liabilities 114,817  113,115 
Commitments and contingencies (Note 11)
Stockholders' equity
Common Stock, par value $0.00001 per share, 2,000,000,000 shares authorized; 1,249,478,357 and 1,243,345,584 shares issued, 1,247,920,536 and 1,241,805,706 shares outstanding
—  — 
Additional paid-in capital 72,919  72,772 
Treasury stock, at cost, 1,557,821 and 1,539,878 shares issued
(14) (11)
Accumulated other comprehensive loss (1,510) (1,581)
Accumulated deficit (3,925) (5,836)
Total stockholders' equity 67,470  65,344 
Total liabilities and stockholders' equity $ 204,124  $ 200,162 
The accompanying notes are an integral part of these condensed consolidated financial statements.
3
Index for Notes to the Condensed Consolidated Financial Statements
T-Mobile US, Inc.
Condensed Consolidated Statements of Comprehensive Income
(Unaudited)
Three Months Ended June 30, Six Months Ended June 30,
(in millions, except share and per share amounts) 2021 2020 2021 2020
Revenues
Postpaid revenues $ 10,492  $ 9,959  $ 20,795  $ 15,846 
Prepaid revenues 2,427  2,311  4,778  4,684 
Wholesale revenues 935  408  1,832  733 
Other service revenues 638  552  1,279  813 
Total service revenues 14,492  13,230  28,684  22,076 
Equipment revenues 5,215  4,269  10,561  6,386 
Other revenues 243  172  464  322 
Total revenues 19,950  17,671  39,709  28,784 
Operating expenses
Cost of services, exclusive of depreciation and amortization shown separately below 3,491  3,098  6,875  4,737 
Cost of equipment sales, exclusive of depreciation and amortization shown separately below 5,453  3,667  10,595  6,196 
Selling, general and administrative 4,823  5,604  9,628  9,292 
Impairment expense —  418  —  418 
Depreciation and amortization 4,077  4,064  8,366  5,782 
Total operating expenses 17,844  16,851  35,464  26,425 
Operating income 2,106  820  4,245  2,359 
Other income (expense)
Interest expense (820) (776) (1,612) (961)
Interest expense to affiliates (32) (63) (78) (162)
Interest income 2  6  5  18 
Other expense, net (1) (195) (126) (205)
Total other expense, net (851) (1,028) (1,811) (1,310)
Income (loss) from continuing operations before income taxes 1,255  (208) 2,434  1,049 
Income tax expense (277) (2) (523) (308)
Income (loss) from continuing operations 978  (210) 1,911  741 
Income from discontinued operations, net of tax —  320  —  320 
Net income $ 978  $ 110  $ 1,911  $ 1,061 
Net income $ 978  $ 110  $ 1,911  $ 1,061 
Other comprehensive income (loss), net of tax
Unrealized gain (loss) on cash flow hedges, net of tax effect of $12, $3, $24, and $(273)
34  2  68  (790)
Unrealized gain on foreign currency translation adjustment, net of tax effect of $0, $0, $0, and $0
1  —  3  — 
Other comprehensive income (loss) 35  2  71  (790)
Total comprehensive income $ 1,013  $ 112  $ 1,982  $ 271 
Earnings (loss) per share
Basic earnings (loss) per share:
Continuing operations $ 0.78  $ (0.17) $ 1.53  $ 0.71 
Discontinued operations —  0.26  —  0.30 
Basic $ 0.78  $ 0.09  $ 1.53  $ 1.01 
Diluted earnings (loss) per share:
Continuing operations $ 0.78  $ (0.17) $ 1.52  $ 0.70 
Discontinued operations —  0.26  —  0.30 
Diluted $ 0.78  $ 0.09  $ 1.52  $ 1.00 
Weighted average shares outstanding
Basic 1,247,563,331  1,236,528,444  1,245,552,847  1,047,338,364 
Diluted 1,253,718,122  1,236,528,444  1,254,264,464  1,057,120,389 

The accompanying notes are an integral part of these condensed consolidated financial statements.
4
Index for Notes to the Condensed Consolidated Financial Statements
T-Mobile US, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Three Months Ended June 30, Six Months Ended June 30,
(in millions) 2021 2020 2021 2020
Operating activities
Net income $ 978  $ 110  $ 1,911  $ 1,061 
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization 4,077  4,064  8,366  5,782 
Stock-based compensation expense 134  259  272  397 
Deferred income tax expense 226  98  437  408 
Bad debt expense 72  233  154  346 
(Gains) losses from sales of receivables (12) 30  (30) 55 
Losses on redemption of debt 28  163  129  163 
Impairment expense —  418  —  418 
Changes in operating assets and liabilities
Accounts receivable (1,839) (498) (1,743) (1,246)
Equipment installment plan receivables (568) 127  (1,295) 196 
Inventories 584  (553) 863  (1,064)
Operating lease right-of-use assets 1,272  937  2,396  1,464 
Other current and long-term assets (154) (104) (100) (98)
Accounts payable and accrued liabilities 28  (1,261) (1,356) (1,666)
Short and long-term operating lease liabilities (996) (1,077) (2,365) (1,802)
Other current and long-term liabilities (47) (2,190) (264) (2,111)
Other, net (4) 21  65  91 
Net cash provided by operating activities 3,779  777  7,440  2,394 
Investing activities
Purchases of property and equipment, including capitalized interest of $57, $119, $141, and $231
(3,270) (2,257) (6,453) (4,010)
Purchases of spectrum licenses and other intangible assets, including deposits (8) (745) (8,930) (844)
Proceeds from sales of tower sites 31  —  31  — 
Proceeds related to beneficial interests in securitization transactions 1,137  602  2,028  1,470 
Net cash related to derivative contracts under collateral exchange arrangements —  1,212  —  632 
Acquisition of companies, net of cash and restricted cash acquired (1) (5,000) (30) (5,000)
Other, net 28  (168) 32  (184)
Net cash used in investing activities (2,083) (6,356) (13,322) (7,936)
Financing activities
Proceeds from issuance of long-term debt 3,006  26,694  9,769  26,694 
Payments of consent fees related to long-term debt —  (109) —  (109)
Repayments of financing lease obligations (269) (236) (556) (518)
Repayments of short-term debt for purchases of inventory, property and equipment and other financial liabilities (36) (151) (91) (176)
Repayments of long-term debt (3,150) (10,529) (5,369) (10,529)
Issuance of common stock —  17,290  —  17,290 
Repurchases of common stock —  (16,990) —  (16,990)
Proceeds from issuance of short-term debt —  18,743  —  18,743 
Repayments of short-term debt —  (18,929) —  (18,929)
Tax withholdings on share-based awards (76) (138) (294) (279)
Cash payments for debt prepayment or debt extinguishment costs (6) (24) (71) (24)
Other, net (46) 7  (91) 2 
Net cash (used in) provided by financing activities (577) 15,628  3,297  15,175 
Change in cash and cash equivalents, including restricted cash 1,119  10,049  (2,585) 9,633 
Cash and cash equivalents, including restricted cash
Beginning of period 6,759  1,112  10,463  1,528 
End of period $ 7,878  $ 11,161  $ 7,878  $ 11,161 
The accompanying notes are an integral part of these condensed consolidated financial statements.
5
Index for Notes to the Condensed Consolidated Financial Statements
T-Mobile US, Inc.
Condensed Consolidated Statement of Stockholders’ Equity
(Unaudited)
(in millions, except shares) Common Stock Outstanding Treasury Shares at Cost Par Value and Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Stockholders' Equity
Balance as of March 31, 2021 1,246,773,175  $ (14) $ 72,839  $ (1,545) $ (4,903) $ 66,377 
Net income —  —  —  —  978  978 
Other comprehensive income —  —  —  35  —  35 
Stock-based compensation —  —  150  —  —  150 
Exercise of stock options 100,238  —  6  —  —  6 
Issuance of vested restricted stock units 1,603,258  —  —  —  —  — 
Shares withheld related to net share settlement of stock awards and stock options (559,630) —  (76) —  —  (76)
Transfers with NQDC plan 3,495  —  —  —  —  — 
Balance as of June 30, 2021 1,247,920,536  $ (14) $ 72,919  $ (1,510) $ (3,925) $ 67,470 
Balance as of December 31, 2020 1,241,805,706  $ (11) $ 72,772  $ (1,581) $ (5,836) $ 65,344 
Net income —  —  —  —  1,911  1,911 
Other comprehensive income —  —  —  71  —  71 
Stock-based compensation —  —  304  —  —  304 
Exercise of stock options 181,040  —  9  —  —  9 
Stock issued for employee stock purchase plan 1,272,253  —  125  —  —  125 
Issuance of vested restricted stock units 7,025,097  —  —  —  —  — 
Shares withheld related to net share settlement of stock awards and stock options (2,345,617) —  (294) —  —  (294)
Transfers with NQDC plan (17,943) (3) 3  —  —  — 
Balance as of June 30, 2021 1,247,920,536  $ (14) $ 72,919  $ (1,510) $ (3,925) $ 67,470 

The accompanying notes are an integral part of these condensed consolidated financial statements.


6
Index for Notes to the Condensed Consolidated Financial Statements
T-Mobile US, Inc.
Condensed Consolidated Statement of Stockholders’ Equity
(Unaudited)
(in millions, except shares) Common Stock Outstanding Treasury Shares at Cost Par Value and Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Stockholders' Equity
Balance as of March 31, 2020 861,128,106  $ (11) $ 38,597  $ (1,660) $ (7,949) $ 28,977 
Net income —  —  —  —  110  110 
Other comprehensive income —  —  —  2  —  2 
Stock-based compensation —  —  272  —  —  272 
Exercise of stock options 262,394  —  14  —  —  14 
Stock issued for employee stock purchase plan (13) —  —  —  —  — 
Issuance of vested restricted stock units 4,157,095  —  —  —  —  — 
Shares withheld related to net share settlement of stock awards and stock options (1,564,635) —  (138) —  —  (138)
Transfers with NQDC plan (40,263) (1) 1  —  —  — 
Shares issued in secondary offering 173,564,426  —  17,216  —  —  17,216 
Shares repurchased from SoftBank (1)
(173,564,426) —  (16,990) —  —  (16,990)
Merger consideration 373,396,310  —  33,533  —  —  33,533 
Balance as of June 30, 2020 1,237,338,994  $ (12) $ 72,505  $ (1,658) $ (7,839) $ 62,996 
Balance as of December 31, 2019 856,905,400  $ (8) $ 38,498  $ (868) $ (8,833) $ 28,789 
Net income —  —  —  —  1,061  1,061 
Other comprehensive loss —  —  —  (790) —  (790)
Executive put option (342,000) —  1  —  —  1 
Stock-based compensation —  —  424  —  —  424 
Exercise of stock options 311,587  —  15  —  —  15 
Stock issued for employee stock purchase plan 1,246,304  —  83  —  —  83 
Issuance of vested restricted stock units 8,912,304  —  —  —  —  — 
Shares withheld related to net share settlement of stock awards and stock options (3,055,034) —  (279) —  —  (279)
Transfers with NQDC plan (35,877) (4) 4  —  —  — 
Shares issued in secondary offering 173,564,426  —  17,216  —  —  17,216 
Shares repurchased from SoftBank (1)
(173,564,426) —  (16,990) —  —  (16,990)
Merger consideration 373,396,310  —  33,533  —  —  33,533 
Prior year Retained Earnings —  —  —  —  (67) (67)
Balance as of June 30, 2020 1,237,338,994  $ (12) $ 72,505  $ (1,658) $ (7,839) $ 62,996 
(1)     On June 22, 2020, we entered into a Master Framework Agreement and related transactions with SoftBank Group Corp. (“SoftBank”) to facilitate SoftBank’s monetization of a portion of our common stock held by SoftBank. We received a payment of $300 million from SoftBank. This amount, net of tax, was treated as a reduction of the purchase price of the shares acquired from SoftBank and was recorded as Additional paid-in capital.

The accompanying notes are an integral part of these condensed consolidated financial statements.
7
Index for Notes to the Condensed Consolidated Financial Statements
T-Mobile US, Inc.
Index for Notes to the Condensed Consolidated Financial Statements
9
9
15
17
20
22
23
25
27
29
29
31
32
33

8
Index for Notes to the Condensed Consolidated Financial Statements
T-Mobile US, Inc.
Notes to the Condensed Consolidated Financial Statements

Note 1 – Summary of Significant Accounting Policies

Basis of Presentation

The unaudited condensed consolidated financial statements of T-Mobile US, Inc. (“T-Mobile,” “we,” “our,” “us” or the “Company”) include all adjustments of a normal recurring nature necessary for the fair presentation of the results for the interim periods presented. The results for the interim periods are not necessarily indicative of those for the full year. The condensed consolidated financial statements should be read in conjunction with our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020.

The condensed consolidated financial statements include the balances and results of operations of T-Mobile and our consolidated subsidiaries. We consolidate majority-owned subsidiaries over which we exercise control, as well as variable interest entities (“VIEs”) where we are deemed to be the primary beneficiary and VIEs which cannot be deconsolidated, such as those related to our obligations to pay for the management and operation of certain of our wireless communications tower sites. Intercompany transactions and balances have been eliminated in consolidation.

The preparation of financial statements in conformity with United States (“U.S.”) generally accepted accounting principles (“GAAP”) requires our management to make estimates and assumptions that affect the financial statements and accompanying notes. Estimates are based on historical experience, where applicable, and other assumptions that management believes are reasonable under the circumstances, including but not limited to, the valuation of assets acquired and liabilities assumed through the merger (the “Merger”) with Sprint Corporation (“Sprint”). These estimates are inherently subject to judgment and actual results could differ from those estimates.

Accounting Pronouncements Not Yet Adopted

Reference Rate Reform

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting,” and has since modified the standard with ASU 2021-01, “Reference Rate Reform (Topic 848): Scope” (together, the “reference rate reform standard”). The reference rate reform standard provides temporary optional expedients and allows for certain exceptions to applying existing GAAP for contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued as a result of reference rate reform. The reference rate reform standard is available for adoption through December 31, 2022, and the optional expedients for contract modifications must be elected for all arrangements within a given Accounting Standards Codification (“ASC”) Topic or Industry Subtopic. We expect to elect the optional expedients for eligible contract modifications accounted for under a given ASC Topic as they occur through December 31, 2022. The application of these expedients is not expected to have a material impact on our consolidated financial statements.

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the SEC did not have, or are not expected to have, a significant impact on our present or future consolidated financial statements.

Note 2 – Business Combinations

Business Combination Agreement and Amendments

On April 29, 2018, we entered into a Business Combination Agreement with Sprint and the other parties named therein (as amended, the “Business Combination Agreement”) for the Merger. The Business Combination Agreement was subsequently amended to provide that, following the closing of the Merger and the other transactions contemplated by the Business Combination Agreement (collectively, the “Transactions”), SoftBank would indemnify us against certain specified matters and the loss of value arising out of, or resulting from, cessation of access to spectrum under certain circumstances and subject to certain limitations and qualifications.

On February 20, 2020, T-Mobile, SoftBank and Deutsche Telekom AG (“DT”) entered into a letter agreement (the “Letter Agreement”). Pursuant to the Letter Agreement, SoftBank agreed to cause its applicable affiliates to surrender to T-Mobile, for
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no additional consideration, an aggregate of 48,751,557 shares of T-Mobile common stock (such number of shares, the “SoftBank Specified Shares Amount”), effective immediately following the Effective Time (as defined in the Business Combination Agreement), making SoftBank’s exchange ratio 11.31 shares of Sprint common stock for each share of T-Mobile common stock. This resulted in an effective exchange ratio of approximately 11.00 shares of Sprint common stock for each share of T-Mobile common stock immediately following the closing of the Merger, an increase from the originally agreed 9.75 shares. Sprint stockholders, other than SoftBank, received the original fixed exchange ratio of 0.10256 shares of T-Mobile common stock for each share of Sprint common stock, or the equivalent of approximately 9.75 shares of Sprint common stock for each share of T-Mobile common stock.

The Letter Agreement requires T-Mobile to issue to SoftBank 48,751,557 shares of T-Mobile common stock, subject to the terms and conditions set forth in the Letter Agreement, for no additional consideration, if certain conditions are met. The issuance of these shares is contingent on the trailing 45-day volume-weighted average price per share of T-Mobile common stock on the NASDAQ Global Select Market being equal to or greater than $150.00, at any time during the period commencing on April 1, 2022 and ending on December 31, 2025. If the threshold price is not met, then none of the SoftBank Specified Shares Amount will be issued.

Closing of Sprint Merger

On April 1, 2020, we completed the Merger, and as a result, Sprint and its subsidiaries became wholly owned consolidated subsidiaries of T-Mobile. Sprint was the fourth-largest telecommunications company in the U.S., offering a comprehensive range of wireless and wireline communication products and services. As a combined company, we have been able to rapidly launch a broad and deep nationwide 5G network, accelerate innovation, increase competition in the U.S. wireless 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.

Upon completion of the Merger, each share of Sprint common stock was exchanged for 0.10256 shares of T-Mobile common stock, or 9.75 shares of Sprint common stock for each share of T-Mobile common stock. After adjustments, including the holdback of the SoftBank Specified Shares Amount and fractional shares, we issued 373,396,310 shares of T-Mobile common stock to Sprint stockholders. The fair value of the T-Mobile common stock provided in exchange for Sprint common stock was approximately $31.3 billion.

Additional components of consideration included the repayment of certain of Sprint’s debt, replacement of equity awards attributable to pre-combination services, contingent consideration and a cash payment received from SoftBank for certain reimbursed Merger expenses.

Immediately following the closing of the Merger and the surrender of the SoftBank Specified Shares Amount, pursuant to the Letter Agreement described above, DT and SoftBank held, directly or indirectly, approximately 43.6% and 24.7%, respectively, of the outstanding T-Mobile common stock, with the remaining approximately 31.7% of the outstanding T-Mobile common stock held by other stockholders.

Consideration Transferred

The acquisition-date fair value of consideration transferred in the Merger totaled $40.8 billion, comprised of the following:
(in millions) April 1, 2020
Fair value of T-Mobile common stock issued to Sprint stockholders (1)
$ 31,328 
Fair value of T-Mobile replacement equity awards attributable to pre-combination service (2)
323 
Repayment of Sprint’s debt (including accrued interest and prepayment penalties) (3)
7,396 
Fair value of contingent consideration (4)
1,882 
Payment received from selling stockholder (5)
(102)
Total consideration exchanged $ 40,827 
(1)     Represents the fair value of T-Mobile common stock issued to Sprint stockholders pursuant to the Business Combination Agreement, less shares surrendered by SoftBank pursuant to the Letter Agreement. The fair value is based on 373,396,310 shares of T-Mobile common stock issued at an exchange ratio of 0.10256 shares of T-Mobile common stock per share of Sprint common stock, less 48,751,557 T-Mobile shares surrendered by SoftBank which are treated as contingent consideration, and the closing price per share of T-Mobile common stock on NASDAQ on March 31, 2020, of $83.90, as shares were transferred to Sprint stockholders prior to the opening of markets on April 1, 2020.
(2)     Equity-based awards held by Sprint employees prior to the acquisition date have been replaced with T-Mobile equity-based awards. The portion of the equity-based awards that relates to services performed by the employee prior to the acquisition date is included within consideration transferred, and includes stock options, restricted stock units and performance-based restricted stock units.
(3)     Represents the cash consideration paid concurrent with the close of the Merger to retire certain Sprint debt, as required by change in control provisions of the debt, plus interest and prepayment penalties.
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(4)     Represents the fair value of the SoftBank Specified Shares Amount contingent consideration that may be issued as set forth in the Letter Agreement.
(5)     Represents receipt of a cash payment from SoftBank for certain reimbursed Merger expenses.

The SoftBank Specified Shares Amount was determined to be contingent consideration with an acquisition-date fair value of $1.9 billion. We estimated the fair value using the income approach, a probability-weighted discounted cash flow model, whereby a Monte Carlo simulation method estimated the probability of different outcomes as the likelihood of achieving the 45-day volume-weighted average price threshold is not easily predicted. This fair value measurement is based on significant inputs not observable in the market and, therefore, represents a Level 3 measurement as defined in ASC 820: Fair Value Measurement. The key assumptions in applying the income approach include estimated future share-price volatility, which was based on historical market trends and estimated future performance of T-Mobile.

The maximum amount of contingent consideration that could be issued to SoftBank has an estimated value of $7.3 billion, based on SoftBank Specified Shares Amount of 48,751,557 multiplied by the defined volume-weighted average price per share of $150.00. The contingent consideration that could be delivered to SoftBank is classified within equity and is not subject to remeasurement.

Fair Value of Assets Acquired and Liabilities Assumed

We accounted for the Merger as a business combination. The identifiable assets acquired and liabilities assumed of Sprint were recorded at their fair values as of the acquisition date and consolidated with those of T-Mobile. Assigning fair market values to the assets acquired and liabilities assumed at the date of an acquisition requires the use of significant judgment regarding estimates and assumptions. For the fair values of the assets acquired and liabilities assumed, we used the cost, income and market approaches, including market participant assumptions.

The following table summarizes the fair values for each major class of assets acquired and liabilities assumed at the acquisition date. We retained the services of certified valuation specialists to assist with assigning values to certain acquired assets and assumed liabilities.
11
(in millions) April 1, 2020
Cash and cash equivalents $ 2,084 
Accounts receivable 1,775 
Equipment installment plan receivables 1,088 
Inventory 658 
Prepaid expenses 140 
Assets held for sale 1,908 
Other current assets 637 
Property and equipment 18,435 
Operating lease right-of-use assets 6,583 
Financing lease right-of-use assets 291 
Goodwill 9,423 
Spectrum licenses 45,400 
Other intangible assets 6,280 
Equipment installment plan receivables due after one year, net 247 
Other assets (1)
540 
Total assets acquired 95,489 
Accounts payable and accrued liabilities 5,015 
Short-term debt 2,760 
Deferred revenue 508 
Short-term operating lease liabilities 1,818 
Short-term financing lease liabilities 8 
Liabilities held for sale 475 
Other current liabilities 681 
Long-term debt 29,037 
Tower obligations 950 
Deferred tax liabilities 3,478 
Operating lease liabilities 5,615 
Financing lease liabilities 12 
Other long-term liabilities 4,305 
Total liabilities assumed 54,662 
Total consideration transferred $ 40,827 
(1)     Included in Other assets acquired is $80 million in restricted cash.

Amounts initially disclosed for the estimated values of certain acquired assets and liabilities assumed were adjusted through March 31, 2021 (the close of the measurement period) based on information arising after the initial valuation.

Intangible Assets and Liabilities

Goodwill with an assigned value of $9.4 billion represents the excess of the consideration transferred over the fair values of assets acquired and liabilities assumed. The goodwill recognized includes synergies expected to be achieved from the operations of the combined company, the assembled workforce of Sprint and intangible assets that do not qualify for separate recognition. Expected synergies from the Merger include the cost savings from the planned integration of network infrastructure, facilities, personnel and systems. None of the goodwill resulting from the Merger is deductible for tax purposes. All of the goodwill acquired is allocated to the wireless reporting unit.

Other intangible assets include $4.9 billion of customer relationships with a weighted-average useful life of eight years and tradenames of $207 million with a useful life of two years. Leased spectrum arrangements that have favorable (asset) and unfavorable (liability) terms compared to current market rates were assigned fair values of $745 million and $125 million, respectively, with 18-year and 19-year weighted average useful lives, respectively.

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The fair value of Spectrum licenses of $45.4 billion was estimated using the income approach, specifically a Greenfield model. This fair value measurement is based on significant inputs not observable in the market and, therefore, represents a Level 3 measurement as defined in ASC 820: Fair Value Measurement. The key assumptions in applying the income approach include the discount rate, estimated market share, estimated capital and operating expenditures, forecasted service revenue and a long-term growth rate for a hypothetical market participant that enters the wireless industry and builds a nationwide wireless network.

Acquired Receivables

The fair value of the assets acquired includes Accounts receivable of $1.8 billion and Equipment installment plan (“EIP”) receivables of $1.3 billion. The unpaid principal balance under these contracts as of April 1, 2020, the date of the Merger, was $1.8 billion and $1.6 billion, respectively. The difference between the fair value and the unpaid principal balance primarily represents amounts expected to be uncollectible.

Indemnification Assets and Contingent Liabilities

Pursuant to Amendment No 2. to the Business Combination Agreement, SoftBank agreed to indemnify us against certain specified matters and losses. As of the acquisition date, we recorded a contingent liability and an offsetting indemnification asset for the expected reimbursement by SoftBank for certain Lifeline matters. The liability is presented in Accounts payable and accrued liabilities, and the indemnification asset is presented in Other current assets within our acquired assets and liabilities at the acquisition date. In November 2020, we entered into a consent decree with the Federal Communications Commission (“FCC”) to resolve certain Lifeline matters, which resulted in a payment of $200 million by SoftBank. Final resolution of these matters could require making additional reimbursements and paying additional fines and penalties, which we do not expect to have a significant impact on our financial results. We expect that any additional liabilities related to these matters would be indemnified and reimbursed by SoftBank.

Deferred Taxes

As a result of the Merger, we acquired deferred tax assets for which a valuation allowance reserve is deemed to be necessary, as well as additional uncertain tax benefit reserves. As of the date of the Merger, the amount of the valuation allowance reserve and uncertain tax benefit reserves was $851 million and $660 million, respectively. We continue to monitor positive and negative evidence related to the utilization of our deferred tax assets subject to a valuation allowance. It is possible the valuation allowance we deem to be necessary will be reduced within the next 12 months.

Transaction Costs

There were no significant transaction costs recognized in the three months ended June 30, 2021. We recognized transaction costs of $145 million for the three months ended June 30, 2020, and $13 million and $184 million for the six months ended June 30, 2021 and 2020, respectively. These costs were associated with legal and professional services and were recognized as Selling, general and administrative expenses in our Condensed Consolidated Statements of Comprehensive Income.

Pro Forma Information

The following unaudited pro forma financial information gives effect to the Transactions as if they had been completed on January 1, 2019. The unaudited pro forma information was prepared in accordance with the requirements of ASC 805: Business Combinations, which is a different basis than pro forma information prepared under Article 11 of Regulation S-X (“Article 11”). As such, they are not directly comparable with historical results for stand-alone T-Mobile prior to April 1, 2020, historical results for T-Mobile from April 1, 2020 that reflect the Transactions and are inclusive of the results and operations of Sprint, nor our previously provided pro forma financials prepared in accordance with Article 11. The pro forma results for the three and six months ended June 30, 2020 include the impact of several significant nonrecurring pro forma adjustments to previously reported operating results. The pro forma adjustments are based on historically reported transactions by the respective companies. The pro forma results do not include any anticipated synergies or other expected benefits of the acquisition.
(in millions) Three Months Ended June 30, 2020 Six Months Ended June 30, 2020
Total revenues $ 17,665  $ 35,073 
(Loss) income from continuing operations (9) 1,102 
Income from discontinued operations, net of tax 320  677 
Net income 311  1,779 

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Significant nonrecurring pro forma adjustments include:

•Transaction costs of $145 million and $202 million that were incurred during the three and six months ended June 30, 2020, respectively, are assumed to have occurred on the pro forma close date of January 1, 2019, and are recognized as if incurred in the first quarter of 2019;
•The Prepaid Business divested on July 1, 2020, is assumed to have been classified as discontinued operations as of January 1, 2019, and the related activities are presented in Income from discontinued operations, net of tax;
•Permanent financing issued and debt redemptions occurring in connection with the closing of the Merger are assumed to have occurred on January 1, 2019, and historical interest expense associated with repaid borrowings is removed;
•Tangible and intangible assets are assumed to be recorded at their estimated fair values as of January 1, 2019 and are depreciated or amortized over their estimated useful lives; and
•Accounting policies of Sprint are conformed to those of T-Mobile including depreciation for leased devices, distribution arrangements with Brightstar US, Inc., amortization of costs to acquire a contract and certain tower lease transactions.

The selected unaudited pro forma condensed combined financial information is provided for illustrative purposes only and does not purport to represent what the actual consolidated results of operations would have been had the Transactions actually occurred on January 1, 2019, nor do they purport to project the future consolidated results of operations.

Regulatory Matters

The Transactions were the subject of various legal and regulatory proceedings involving a number of state and federal agencies. In connection with those proceedings and the approval of the Transactions, we have certain commitments and other obligations to various state and federal agencies and certain nongovernmental organizations. See Note 11 - Commitments and Contingencies for further information.

Shenandoah Personal Communications Company Affiliate Relationship

Sprint PCS (specifically Sprint Spectrum L.P.) was party to a variety of publicly filed agreements with Shenandoah Personal Communications Company LLC (“Shentel”), pursuant to which Shentel was the exclusive provider of Sprint PCS’s wireless mobility communications network products in certain parts of Maryland, North Carolina, Virginia, West Virginia, Kentucky, Ohio and Pennsylvania. Pursuant to one such agreement, the Sprint PCS Management Agreement, dated November 5, 1999 (as amended, supplemented and modified from time to time, the “Management Agreement”), Sprint PCS was granted an option to purchase Shentel’s wireless telecommunications assets (the “Wireless Assets”) used to provide services pursuant to the Management Agreement. On August 26, 2020, Sprint, now our indirect subsidiary, on behalf of and as the direct or indirect owner of Sprint PCS, exercised its option by delivering a binding notice of exercise to Shentel.

On May 28, 2021, T-Mobile USA, Inc., a Delaware corporation and our direct wholly-owned subsidiary, entered into an asset purchase agreement (the “Purchase Agreement”) with Shentel, for the acquisition of the Wireless Assets for an aggregate purchase price of approximately $1.9 billion in cash, subject to certain adjustments prescribed by the Management Agreement and such additional adjustments agreed by the parties.

Subsequent to June 30, 2021 and upon the completion of certain customary conditions, including the receipt of certain regulatory approvals, on July 1, 2021, we closed on the acquisition of the Wireless Assets pursuant to the Purchase Agreement and, as a result, T-Mobile became the legal owner of the Wireless Assets. Concurrently and as agreed to through the Purchase Agreement, T-Mobile and Shentel entered into certain separate transactions, including the effective settlement of the pre-existing arrangements between T-Mobile and Shentel under the Management Agreement. In exchange, T-Mobile transferred cash of approximately $2.0 billion, approximately $1.9 billion of which was determined to be consideration transferred for the Wireless Assets and the remainder of which was determined to relate to separate transactions, primarily associated with the effective settlement of pre-existing arrangements between T-Mobile and Shentel. Accordingly, these separate transactions are not included in the calculation of the consideration transferred in exchange for the Wireless Assets. We do not currently expect any additional material adjustments to the consideration already transferred.

We have concluded that the acquired set of the Wireless Assets constitutes a business as defined in ASC 805, “Business Combinations,” and we therefore will account for the acquired set of Wireless Assets as a business combination. The major classes of assets acquired through the acquisition of the Wireless Assets include fixed assets and network equipment, operating lease right-of-use assets, reacquired rights and other intangible assets. The major classes of liabilities assumed include operating
14
lease liabilities. Due to the limited time since the acquisition date and the complexity of the acquisition, the accounting for the business combination and separate transactions as agreed to through the Purchase Agreement are not yet complete. We are not able to provide the allocation of consideration paid to the assets acquired or liabilities assumed, nor are we able to provide additional details on the accounting for the concurrent transactions agreed to through the Purchase Agreement. The financial results of the Wireless Assets are not expected to be material to our Condensed Consolidated Statements of Comprehensive Income.

Note 3 – Receivables and Expected Credit Losses

We maintain an allowance for expected credit losses that assesses the lifetime credit losses that we expect to incur related to our receivable portfolio segments. Each period, management assesses the appropriateness of the level of allowance for credit losses by considering credit risk inherent within each portfolio segment as of period end.

We consider a receivable past due when a customer has not paid us by the contractually specified payment due date. Account balances are written off against the allowance for credit losses if collection efforts are unsuccessful and the receivable balance is deemed uncollectible, based on factors such as customer credit ratings as well as the length of time the amounts are past due.

Our portfolio of receivables is comprised of two portfolio segments: accounts receivable and EIP receivables.

Accounts Receivable Portfolio Segment

Our accounts receivable segment primarily consists of amounts currently due from customers, including service and leased device receivables, device insurance administrators, wholesale partners, third-party retail channels and other carriers.

We estimate expected credit losses associated with our accounts receivable portfolio using an aging schedule methodology that utilizes historical information and current conditions to develop expected credit losses by aging bucket, including for receivables that are not past due.

To determine the appropriate credit loss percentages by aging bucket, we consider a number of factors, including our overall historical credit losses, net of recoveries and timely payment experience as well as current collection trends such as write-off frequency and severity, credit quality of the customer base, and other qualitative factors such as macro-economic conditions, including the expected economic impacts of the COVID-19 pandemic (the “Pandemic”).

We consider the need to adjust our estimate of expected credit losses for reasonable and supportable forecasts of future economic conditions. To do so, we monitor professional forecasts of changes in real U.S. gross domestic product and forecasts of consumer credit behavior for comparable credit exposures. We also periodically evaluate other economic indicators such as unemployment rates to assess their level of correlation with our historical credit loss statistics.

EIP Receivables Portfolio Segment

Based upon customer credit profiles at the time of customer origination, we classify the EIP receivables segment into two customer classes of “Prime” and “Subprime.” Prime customer receivables are those with lower credit risk and Subprime customer receivables are those with higher credit risk. Customers may be required to make a down payment on their equipment purchases. In addition, certain customers within the Subprime category may be required to pay a deposit.

To determine a customer’s credit profile, we use a proprietary credit scoring model that measures the credit quality of a customer using several factors, such as credit bureau information, consumer credit risk scores and service and device plan characteristics.

Installment loans acquired in the Merger are included in EIP receivables. We applied our proprietary credit scoring model to the customers acquired in the Merger with an outstanding EIP receivable balance. Based on tenure, consumer credit risk score and credit profile, these acquired customers were classified into our customer classes of Prime or Subprime.

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The following table summarizes the EIP receivables, including imputed discounts and related allowance for credit losses:
(in millions) June 30,
2021 		December 31,
2020
EIP receivables, gross $ 6,945  $ 6,213 
Unamortized imputed discount (342) (325)
EIP receivables, net of unamortized imputed discount 6,603  5,888 
Allowance for credit losses (255) (280)
EIP receivables, net of allowance for credit losses and imputed discount $ 6,348  $ 5,608 
Classified on the balance sheet as:
Equipment installment plan receivables, net of allowance for credit losses and imputed discount $ 4,064  $ 3,577 
Equipment installment plan receivables due after one year, net of allowance for credit losses and imputed discount 2,284  2,031 
EIP receivables, net of allowance for credit losses and imputed discount $ 6,348  $ 5,608 

We manage our EIP receivables portfolio using delinquency and customer credit class as key credit quality indicators. The following table presents the amortized cost of our EIP receivables by delinquency status, customer credit class and year of origination as of June 30, 2021:
Originated in 2021 Originated in 2020 Originated prior to 2020 Total EIP Receivables, net of
unamortized imputed discounts
(in millions) Prime Subprime Prime Subprime Prime Subprime Prime Subprime Grand total
Current - 30 days past due $ 2,177  $ 1,436  $ 1,613  $ 954  $ 221  $ 100  $ 4,011  $ 2,490  $ 6,501 
31 - 60 days past due 12  18  11  17  2  3  25  38  63 
61 - 90 days past due 2  5  3  7  1  1  6  13  19 
More than 90 days past due 2  2  3  7  2  4  7  13  20 
EIP receivables, net of unamortized imputed discount $ 2,193  $ 1,461  $ 1,630  $ 985  $ 226  $ 108  $ 4,049  $ 2,554  $ 6,603 

We estimate expected credit losses on our EIP receivables by using historical data adjusted for current conditions to calculate default probabilities for our outstanding EIP loans. We consider various risk characteristics when calculating default probabilities, such as how long such loans have been outstanding, customer credit ratings, customer tenure, delinquency status and other correlated variables identified through statistical analyses. We multiply these estimated default probabilities by our estimated loss given default, which considers recoveries.

As we do for our accounts receivable portfolio segment, we consider the need to adjust our estimate of expected losses on EIP receivables for reasonable and supportable forecasts of economic conditions through monitoring external professional forecasts and periodic internal statistical analyses, including the expected economic impacts of the Pandemic.

For EIP receivables acquired in the Merger, the difference between the fair value and unpaid principal balance of the loan at the acquisition date is accreted to interest income over the contractual life of the loan using the effective interest method. EIP receivables had a combined weighted average effective interest rate of 6.3% and 6.7% as of June 30, 2021 and December 31, 2020, respectively.

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Activity for the six months ended June 30, 2021 and 2020, in the allowance for credit losses and unamortized imputed discount balances for the accounts receivable and EIP receivables segments were as follows:
June 30, 2021 June 30, 2020
(in millions) Accounts Receivable Allowance EIP Receivables Allowance Total Accounts Receivable Allowance EIP Receivables Allowance Total
Allowance for credit losses and imputed discount, beginning of period $ 194  $ 605  $ 799  $ 61  $ 399  $ 460 
Beginning balance adjustment due to implementation of the new credit loss standard —  —  —  —  91  91 
Bad debt expense 76  78  154  178  168  346 
Write-offs, net of recoveries (147) (104) (251) (56) (96) (152)
Change in imputed discount on short-term and long-term EIP receivables N/A 91  91  N/A 10  10 
Impact on the imputed discount from sales of EIP receivables N/A (73) (73) N/A (81) (81)
Allowance for credit losses and imputed discount, end of period $ 123  $ 597  $ 720  $ 183  $ 491  $ 674 

Off-Balance-Sheet Credit Exposures

We do not have material, unmitigated off-balance-sheet credit exposures as of June 30, 2021. In connection with the sales of certain service and EIP accounts receivable pursuant to the sale arrangements, we have deferred purchase price assets included in our Condensed Consolidated Balance Sheets measured at fair value that are based on a discounted cash flow model using Level 3 inputs, including customer default rates and credit worthiness, dilutions and recoveries. See Note 4 – Sales of Certain Receivables for further information.

Note 4 – Sales of Certain Receivables

We have entered into transactions to sell certain service accounts receivable and EIP receivables. The transactions, including our continuing involvement with the sold receivables and the respective impacts to our condensed consolidated financial statements, are described below.

Sales of EIP Receivables

Overview of the Transaction

In 2015, we entered into an arrangement to sell certain EIP receivables on a revolving basis (the “EIP sale arrangement”). The maximum funding commitment of the sale arrangement is $1.3 billion. The scheduled expiration date of the EIP sale arrangement is November 18, 2021.

On April 30, 2020, we agreed with the purchaser banks to update our collection policies to temporarily allow for flexibility for modifications to the EIP receivables sold that are impacted by the Pandemic and exclusion of such EIP receivables from all pool performance triggers.

As of both June 30, 2021 and December 31, 2020, the EIP sale arrangement provided funding of $1.3 billion. Sales of EIP receivables occur daily and are settled on a monthly basis.

In connection with this EIP sale arrangement, we formed a wholly owned subsidiary, which qualifies as a bankruptcy remote entity (the “EIP BRE”). Pursuant to the EIP sale arrangement, our wholly owned subsidiary transfers selected receivables to the EIP BRE. The EIP BRE then sells the receivables to a non-consolidated and unaffiliated third-party entity over which we do not exercise any level of control, nor does the third-party entity qualify as a VIE.

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Variable Interest Entity

We determined that the EIP BRE is a VIE as its equity investment at risk lacks the obligation to absorb a certain portion of its expected losses. We have a variable interest in the EIP BRE and have determined that we are the primary beneficiary based on our ability to direct the activities which most significantly impact the EIP BRE’s economic performance. Those activities include selecting which receivables are transferred into the EIP BRE and sold in the EIP sale arrangement and funding of the EIP BRE. Additionally, our equity interest in the EIP BRE obligates us to absorb losses and gives us the right to receive benefits from the EIP BRE that could potentially be significant to the EIP BRE. Accordingly, we include the balances and results of operations of the EIP BRE in our condensed consolidated financial statements.

The following table summarizes the carrying amounts and classification of assets, which consist primarily of the deferred purchase price, and liabilities included in our Condensed Consolidated Balance Sheets with respect to the EIP BRE:
(in millions) June 30,
2021 		December 31,
2020
Other current assets $ 436  $ 388 
Other assets 133  120 
Other long-term liabilities 4  4 

In addition, the EIP BRE is a separate legal entity with its own separate creditors who will be entitled, prior to any liquidation of the EIP BRE, to be satisfied prior to any value in the EIP BRE becoming available to us. Accordingly, the assets of the EIP BRE may not be used to settle our general obligations and creditors of the EIP BRE have limited recourse to our general credit.

Sales of Service Accounts Receivable

Overview of the Transaction

In 2014, we entered into an arrangement to sell certain service accounts receivable on a revolving basis (the “service receivable sale arrangement”). The maximum funding commitment of the service receivable sale arrangement is $950 million, and the facility expires in March 2022. As of June 30, 2021 and December 31, 2020, the service receivable sale arrangement provided funding of $775 million and $772 million, respectively. Sales of receivables occur daily and are settled on a monthly basis. The receivables consist of service charges currently due from customers and are short-term in nature.

In connection with the service receivable sale arrangement, we formed a wholly owned subsidiary, which qualifies as a bankruptcy remote entity, to sell service accounts receivable (the “Service BRE”). In March 2021, we amended the sale arrangement to conform its structure to the EIP sale arrangement (the “March 2021 Amendment”). This involved, among other things, removal of an unaffiliated special purpose entity that we did not consolidate under the original structure and changes in contractual counterparties. While the amendment simplified the structure of the arrangement making it more efficient, it did not impact the maximum funding commitment under, or the level of funding provided by, the facility.

Pursuant to the amended service receivable sale arrangement, our wholly owned subsidiary transfers selected receivables to the Service BRE. The Service BRE then sells the receivables to a non-consolidated and unaffiliated third-party entity over which we do not exercise any level of control and which does not qualify as a VIE.

Variable Interest Entity

Prior to the March 2021 Amendment, the Service BRE did not qualify as a VIE, but due to the significant level of control we exercised over the entity, it was consolidated.

The March 2021 Amendment to the service receivable sale arrangement triggered a VIE reassessment, and we determined that the Service BRE now qualifies as a VIE. We have a variable interest in the Service BRE and have determined that we are the primary beneficiary based on our ability to direct the activities that most significantly impact the Service BRE’s economic performance. Those activities include selecting which receivables are transferred into the Service BRE and sold in the service receivable sale arrangement and funding the Service BRE. Additionally, our equity interest in the Service BRE obligates us to absorb losses and gives us the right to receive benefits from the Service BRE that could potentially be significant to the Service BRE. Accordingly, we include the balances and results of operations of the Service BRE in our condensed consolidated financial statements.

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The following table summarizes the carrying amounts and classification of assets, which consist primarily of the deferred purchase price, and liabilities included in our Condensed Consolidated Balance Sheets with respect to the Service BRE:
(in millions) June 30,
2021 		December 31,
2020
Other current assets $ 202  $ 378 
Other current liabilities 313  357 

In addition, the Service BRE is a separate legal entity with its own separate creditors who will be entitled, prior to any liquidation of the Service BRE, to be satisfied prior to any value in the Service BRE becoming available to us. Accordingly, the assets of the Service BRE may not be used to settle our general obligations, and creditors of the Service BRE have limited recourse to our general credit.

Sales of Receivables

The transfers of service receivables and EIP receivables to the non-consolidated entities are accounted for as sales of financial assets. Once identified for sale, the receivable is recorded at the lower of cost or fair value. Upon sale, we derecognize the net carrying amount of the receivables.

We recognize the cash proceeds received upon sale in Net cash provided by operating activities in our Condensed Consolidated Statements of Cash Flows. We recognize proceeds net of the deferred purchase price, consisting of a receivable from the purchasers that entitles us to certain collections on the receivables. We recognize the collection of the deferred purchase price in Net cash used in investing activities in our Condensed Consolidated Statements of Cash Flows as Proceeds related to beneficial interests in securitization transactions.

The deferred purchase price represents a financial asset that is primarily tied to the creditworthiness of the customers and which can be settled in such a way that we may not recover substantially all of our recorded investment, due to default by the customers on the underlying receivables. At inception, we elected to measure the deferred purchase price at fair value with changes in fair value included in Selling, general and administrative expense in our Condensed Consolidated Statements of Comprehensive Income. The fair value of the deferred purchase price is determined based on a discounted cash flow model which uses primarily Level 3 inputs, including customer default rates. As of June 30, 2021 and December 31, 2020, our deferred purchase price related to the sales of service receivables and EIP receivables was $770 million and $884 million, respectively.

The following table summarizes the impact of the sale of certain service receivables and EIP receivables in our Condensed Consolidated Balance Sheets:
(in millions) June 30,
2021 		December 31,
2020
Derecognized net service receivables and EIP receivables $ 2,491  $ 2,528 
Other current assets 638  766 
of which, deferred purchase price 637  764 
Other long-term assets 133  120 
of which, deferred purchase price 133  120 
Other current liabilities 313  357 
Other long-term liabilities 4  4 
Net cash proceeds since inception 1,755  1,715 
Of which:
Change in net cash proceeds during the year-to-date period 40  (229)
Net cash proceeds funded by reinvested collections 1,715  1,944 

We recognized a gain from sales of receivables, including adjustments to the receivables’ fair values and changes in fair value of the deferred purchase price, of $12 million and a loss from sales of receivables of $30 million for the three months ended June 30, 2021 and 2020, respectively, and a gain of $30 million and a loss of $55 million for the six months ended June 30, 2021 and 2020, respectively, in Selling, general and administrative expense in our Condensed Consolidated Statements of Comprehensive Income.

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Continuing Involvement

Pursuant to the sale arrangements described above, we have continuing involvement with the service receivables and EIP receivables we sell as we service the receivables, are required to repurchase certain receivables, including ineligible receivables, aged receivables and receivables where write-off is imminent, and may be responsible for absorbing credit losses through reduced collections on our deferred purchase price assets. We continue to service the customers and their related receivables, including facilitating customer payment collection, in exchange for a monthly servicing fee. As the receivables are sold on a revolving basis, the customer payment collections on sold receivables may be reinvested in new receivable sales. At the direction of the purchasers of the sold receivables, we apply the same policies and procedures while servicing the sold receivables as we apply to our owned receivables, and we continue to maintain normal relationships with our customers. Pursuant to the EIP sale arrangement, under certain circumstances, we are required to deposit cash or replacement EIP receivables primarily for contracts terminated by customers under our JUMP! program.

Note 5 – Goodwill, Spectrum License Transactions and Other Intangible Assets

Goodwill

The changes in the carrying amount of goodwill for the six months ended June 30, 2021 and year ended December 31, 2020, are as follows:
(in millions) Goodwill
Historical goodwill, net of accumulated impairment losses of $10,766
$ 1,930 
Goodwill from acquisitions in 2020 9,405 
Layer3 goodwill impairment (218)
Balance as of December 31, 2020 11,117 
Purchase price adjustment of goodwill from acquisitions in 2020 22 
Goodwill from acquisitions in 2021 13 
Balance as of June 30, 2021 $ 11,152 
Accumulated impairment losses at June 30, 2021 $ (10,984)

On April 1, 2020, we completed our Merger with Sprint, which was accounted for as a business combination resulting in $9.4 billion in goodwill. The acquired goodwill was allocated to the wireless reporting unit and will be tested for impairment at this level. See Note 2 - Business Combinations for further information.

Intangible Assets

Identifiable Intangible Assets Acquired

The following table summarizes the fair value of the intangible assets acquired in the Merger:
Weighted Average Useful Life (in years) Fair Value as of April 1, 2020
(in millions)
Spectrum licenses Indefinite-lived $ 45,400 
Tradenames (1)
2 years
207 
Customer relationships
8 years
4,900 
Favorable spectrum leases
18 years
745 
Other intangible assets
7 years
428 
Total intangible assets acquired $ 51,680 
(1)     Tradenames include the Sprint brand.

Spectrum licenses are issued for a fixed period of time, typically up to 15 years; however, the FCC has granted license renewals routinely and at a nominal cost. The spectrum licenses acquired expire at various dates and we believe we will be able to meet all requirements necessary to secure renewal of our spectrum licenses at a nominal cost. Moreover, we determined that there are currently no legal, regulatory, contractual, competitive, economic or other factors that limit the useful lives of our spectrum licenses. Therefore, we determined the spectrum licenses should be treated as indefinite-lived intangible assets. The fair value of spectrum licenses includes the value associated with aggregating a nationwide portfolio of owned and leased spectrum.

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Favorable spectrum leases represent a contract where the market rate is higher than the future contractual lease payments. We lease this spectrum from third parties who hold the spectrum licenses. As these contracts pertain to intangible assets, they are excluded from the lease accounting guidance (ASC 842) and are accounted for as service contracts in which the expense is recognized on a straight-line basis over the lease team. Favorable spectrum leases of $745 million were recorded as an intangible asset as a result of purchase accounting and are amortized on a straight-line basis over the associated remaining lease term. Additionally, we recognized unfavorable spectrum lease liabilities of $125 million, which are also amortized over their respective remaining lease terms and are included in Other liabilities in our Condensed Consolidated Balance Sheets.

The customer relationship intangible assets represent the value associated with the acquired Sprint customers. The customer relationship intangible assets are amortized using the sum-of-the-years’ digits method over periods of up to eight years.

Other intangible assets are amortized over the remaining period that the asset is expected to provide benefit to us.

Spectrum Licenses

The following table summarizes our spectrum license activity for the six months ended June 30, 2021:
(in millions) 2021
Spectrum licenses, beginning of year $ 82,828 
Spectrum license acquisitions 87 
Costs to clear spectrum 2 
Spectrum licenses, end of period $ 82,917 

In March 2021, the FCC announced that we were the winning bidder of 142 licenses in Auction 107 (C-band spectrum) for an aggregate purchase price of $9.3 billion, excluding relocation costs. At the inception of Auction 107 in October 2020, we deposited $438 million. Upon conclusion of Auction 107 in March 2021, we paid the FCC the remaining $8.9 billion for the licenses won in the auction. Cash payments to acquire spectrum licenses and payments for costs to clear spectrum are included in Purchases of spectrum licenses and other intangible assets, including deposits in our Condensed Consolidated Statements of Cash Flows for the three and six months ended June 30, 2021. We expect to incur an additional $1.2 billion in relocation costs which will be paid through 2024.

The aggregate cash payments made to the FCC are included in Other assets as of June 30, 2021, in our Condensed Consolidated Balance Sheets, as the licenses had not yet been issued. As of June 30, 2021, the activities that are necessary to get the C-band spectrum ready for its intended use have not begun, as such, capitalization of the interest associated with the costs of acquiring the C-band spectrum has not begun. Subsequent to June 30, 2021, on July 23, 2021, the FCC issued to us the licenses won in the Auction.

Other Intangible Assets

The components of Other intangible assets were as follows:
Useful Lives June 30, 2021 December 31, 2020
(in millions) Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount
Customer relationships
Up to 8 years
$ 4,903  $ (1,398) $ 3,505  $ 4,900  $ (865) $ 4,035 
Tradenames and patents
Up to 19 years
606  (486) 120  598  (412) 186 
Favorable spectrum leases
Up to 27 years
741  (54) 687  790  (35) 755 
Other
Up to 10 years
377  (89) 288  377  (55) 322 
Other intangible assets $ 6,627  $ (2,027) $ 4,600  $ 6,665  $ (1,367) $ 5,298 

Amortization expense for intangible assets subject to amortization was $295 million and $387 million for the three months ended June 30, 2021 and 2020, respectively, and $661 million and $411 million for the six months ended June 30, 2021 and 2020, respectively.

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The estimated aggregate future amortization expense for intangible assets subject to amortization are summarized below:
(in millions) Estimated Future Amortization
Twelve Months Ending June 30,
2022 $ 1,095 
2023 903 
2024 746 
2025 588 
2026 428 
Thereafter 840 
Total $ 4,600 
Substantially all of the estimated future amortization expense is associated with intangible assets acquired in the Merger.

Note 6 – Fair Value Measurements

The carrying values of Cash and cash equivalents, Accounts receivable, Accounts receivable from affiliates, Accounts payable and accrued liabilities and borrowings under vendor financing arrangements with our primary network equipment suppliers approximate fair value due to the short-term maturities of these instruments.

Derivative Financial Instruments

Periodically, we use derivatives to manage exposure to market risk, such as interest rate risk. We designate certain derivatives as hedging instruments in a qualifying hedge accounting relationship (cash flow hedge) to help minimize significant, unplanned fluctuations in cash flows caused by interest rate volatility. We do not use derivatives for trading or speculative purposes.

Interest Rate Lock Derivatives
In October 2018, we entered into interest rate lock derivatives with notional amounts of $9.6 billion. In November 2019, we extended the mandatory termination date on our interest rate lock derivatives to June 3, 2020. For the three months ended March 31, 2020, we made net collateral transfers to certain of our derivative counterparties totaling $580 million, which included variation margin transfers to (or from) such derivative counterparties based on daily market movements. No amounts were transferred to the derivative counterparties subsequent to March 31, 2020. These collateral transfers are included in Net cash related to derivative contracts under collateral exchange arrangements within Net cash used in investing activities in our Condensed Consolidated Statements of Cash Flows.

We recorded interest rate lock derivatives on our Condensed Consolidated Balance Sheets at fair value that was derived primarily from observable market data, including yield curves. Interest rate lock derivatives were classified as Level 2 in the fair value hierarchy. Cash flows associated with qualifying hedge derivative instruments are presented in the same category on the Condensed Consolidated Statements of Cash Flows as the item being hedged.

Aggregate changes in the fair value of the interest rate lock derivatives, net of tax and amortization, of $1.5 billion and $1.6 billion are presented in Accumulated other comprehensive loss as of June 30, 2021 and December 31, 2020, respectively.
Between April 2 and April 6, 2020, in connection with the issuance of an aggregate of $19.0 billion of Senior Secured Notes bearing interest rates ranging from 3.500% to 4.500% and maturing in 2025 through 2050, we terminated our interest rate lock derivatives.

At the time of termination in the second quarter of 2020, the interest rate lock derivatives were a liability of $2.3 billion, of which $1.2 billion was cash-collateralized. The cash flows associated with the settlement of interest rate lock derivatives are presented on a gross basis in our Condensed Consolidated Statements of Cash Flows, with the total cash payments to settle the swaps of $2.3 billion presented in changes in Other current and long-term liabilities within Net cash provided by operating activities and the return of cash collateral of $1.2 billion presented as an inflow in Net cash related to derivative contracts under collateral exchange arrangements within Net cash used in investing activities for the three and six months ended June 30, 2020.

Upon the issuance of debt to which the hedged interest rate risk related, we began amortizing the Accumulated other comprehensive loss related to the derivatives into Interest expense in a manner consistent with how the hedged interest payments affect earnings. For the three and six months ended June 30, 2021, $47 million and $93 million, respectively, was amortized from Accumulated other comprehensive loss into Interest expense in the Condensed Consolidated Statements of
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Comprehensive Income. For both the three and six months ended June 30, 2020, $39 million was amortized from Accumulated other comprehensive loss into Interest expense. We expect to amortize $196 million of the Accumulated other comprehensive loss associated with the derivatives into Interest expense over the next 12 months.

Deferred Purchase Price Assets
In connection with the sales of certain service and EIP accounts receivable pursuant to the sale arrangements, we have deferred purchase price assets measured at fair value that are based on a discounted cash flow model using unobservable Level 3 inputs, including customer default rates. See Note 4 – Sales of Certain Receivables for further information.

The carrying amounts of our deferred purchase price assets, which are measured at fair value on a recurring basis and are included in our Condensed Consolidated Balance Sheets, were $770 million and $884 million at June 30, 2021 and December 31, 2020, respectively. Fair value was equal to carrying amount at June 30, 2021 and December 31, 2020.

Debt

The fair value of our Senior Unsecured Notes and Senior Secured Notes to third parties was determined based on quoted market prices in active markets, and therefore were classified as Level 1 within the fair value hierarchy. The fair value of our Senior Notes to affiliates was determined based on a discounted cash flow approach using market interest rates of instruments with similar terms and maturities and an estimate for our standalone credit risk. Accordingly, our Senior Notes to affiliates were classified as Level 2 within the fair value hierarchy.

Although we have determined the estimated fair values using available market information and commonly accepted valuation methodologies, considerable judgment was required in interpreting market data to develop fair value estimates for the Senior Notes to affiliates. The fair value estimates were based on information available as of June 30, 2021 and December 31, 2020. As such, our estimates are not necessarily indicative of the amount we could realize in a current market exchange.

The carrying amounts and fair values of our short-term and long-term debt included in our Condensed Consolidated Balance Sheets were as follows:
Level within the Fair Value Hierarchy June 30, 2021 December 31, 2020
(in millions)
Carrying Amount (1)
Fair Value (1)
Carrying Amount (1)
Fair Value (1)
Liabilities:
Senior Unsecured Notes to third parties 1 $ 34,768  $ 36,967  $ 29,966  $ 32,450 
Senior Notes to affiliates 2 4,725  4,937  4,716  4,991 
Senior Secured Notes to third parties 1 35,629  38,612  36,204  40,519 
(1)     Excludes $148 million and $240 million as of June 30, 2021 and December 31, 2020, respectively, in vendor financing arrangements and other debt as the carrying values approximate fair value primarily due to the short-term maturities of these instruments.

Note 7 – Debt

The following table sets forth the debt balances and activity as of, and for the six months ended, June 30, 2021:
(in millions) December 31,
2020
Proceeds from Issuances and Borrowings (1)
Note Redemptions (1)
Repayments
Reclassifications (1)
Other (2)
June 30,
2021
Short-term debt $ 4,579  $ —  $ —  $ (660) $ 786  $ (57) $ 4,648 
Long-term debt 61,830  9,768  (4,742) —  (786) (173) 65,897 
Total debt to third parties 66,409  9,768  (4,742) (660) —  (230) 70,545 
Short-term debt to affiliates —  —  —  —  2,231  4  2,235 
Long-term debt to affiliates 4,716  —  —  —  (2,231) 5  2,490 
Total debt $ 71,125  $ 9,768  $ (4,742) $ (660) $ —  $ (221) $ 75,270 
(1)Issuances and borrowings, note redemptions, and reclassifications are recorded net of related issuance costs, discounts and premiums.
(2)Other includes the amortization of premiums, discounts, debt issuance costs and consent fees.

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Our effective interest rate, excluding the impact of derivatives and capitalized interest, was approximately 4.1% and 4.9% for the three months ended June 30, 2021 and 2020, respectively, and 4.2% and 4.7% for the six months ended June 30, 2021 and 2020, respectively, on weighted average debt outstanding of $75.5 billion and $66.1 billion for the three months ended June 30, 2021 and 2020, respectively, and $74.5 billion and $48.5 billion for the six months ended June 30, 2021 and 2020, respectively. The weighted average debt outstanding was calculated by applying an average of the monthly ending balances of total short-term and long-term debt and short-term and long-term debt to affiliates, net of unamortized premiums, discounts, debt issuance costs and consent fees.

Issuances and Borrowings

During the six months ended June 30, 2021, we issued the following Senior Notes:
(in millions) Principal Issuances Premiums and Issuance Costs Net Proceeds from Issuance of Long-Term Debt Issue Date
2.250% Senior Notes due 2026
$ 1,000  $ (7) $ 993  January 14, 2021
2.625% Senior Notes due 2029
1,000  (7) 993  January 14, 2021
2.875% Senior Notes due 2031
1,000  (6) 994  January 14, 2021
2.625% Senior Notes due 2026
1,200  (7) 1,193  March 23, 2021
3.375% Senior Notes due 2029
1,250  (7) 1,243  March 23, 2021
3.500% Senior Notes due 2031
1,350  (8) 1,342  March 23, 2021
2.250% Senior Notes due 2026
800  (2) 798  May 13, 2021
3.375% Senior Notes due 2029
1,100  6  1,106  May 13, 2021
3.500% Senior Notes due 2031
1,100  6  1,106  May 13, 2021
Total of Senior Notes issued $ 9,800  $ (32) $ 9,768 

Credit Facilities

On October 30, 2020, we entered into a $5.0 billion senior secured term loan commitment with certain financial institutions. On January 14, 2021, we issued an aggregate of $3.0 billion of Senior Notes. A portion of the senior secured term loan commitment was reduced by an amount equal to the aggregate gross proceeds of the Senior Notes, which reduced the commitment to $2.0 billion. On March 23, 2021, we issued an aggregate of $3.8 billion of Senior Notes. The senior secured term loan commitment was terminated upon the issuance of the $3.8 billion of Senior Notes.

Senior Notes

On January 14, 2021, we issued $1.0 billion of 2.250% Senior Notes due 2026, $1.0 billion of 2.625% Senior Notes due 2029, and $1.0 billion of 2.875% Senior Notes due 2031.

On March 23, 2021, we issued $1.2 billion of 2.625% Senior Notes due 2026, $1.25 billion of 3.375% Senior Notes due 2029, and $1.35 billion of 3.500% Senior Notes due 2031.

On May 13, 2021, we issued $800 million of 2.250% Senior Notes due 2026, $1.1 billion of 3.375% Senior Notes due 2029, and $1.1 billion of 3.500% Senior Notes due 2031.
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Note Redemptions and Repayments

During the six months ended June 30, 2021, we made the following note redemptions and repayments:
(in millions) Principal Amount
Write-off of Issuance Cost and Consent Fees (1)
Redemption Premium (2)
Redemption Date Redemption Price
6.500% Senior Notes due 2026
$ 2,000  $ 36  $ 65  March 27, 2021 103.250  %
6.000% Senior Notes due 2023
1,300  10  —  May 23, 2021 100.000  %
6.000% Senior Notes due 2024
1,000  9  —  May 23, 2021 100.000  %
5.125% Senior Notes due 2025
500  3  6  May 23, 2021 101.281  %
Total Senior Notes to third parties redeemed $ 4,800  $ 58  $ 71 
3.360% Secured Series 2016-1 A-1 Notes due 2021
$ 438  $ —  $ —  Various N/A
4.738% Secured Series 2018-1 A-1 Notes due 2025
131  —  —  Various N/A
Other debt 91  —  —  Various N/A
Total Repayments $ 660  $ —  $ — 
(1)Write-off of issuance costs and consent fees are included in Other expense, net in our Condensed Consolidated Statements of Comprehensive Income. Write-off of issuance costs and consent fees are included in Loss on redemption of debt within Net cash provided by operating activities in our Condensed Consolidated Statements of Cash Flows.
(2)The redemption premium is the excess paid over the principal amount. Redemption premiums are included within Net cash used in financing activities in our Condensed Consolidated Statements of Cash Flows.

On March 27, 2021, we redeemed $2.0 billion aggregate principal amount of our 6.500% Senior Notes due 2026. The notes were redeemed at a redemption price equal to 103.250% of the principal amount of the notes (plus accrued and unpaid interest thereon), and were paid on March 26, 2021. The redemption premium was $65 million and the write off of issuance costs and consent fees was approximately $36 million, which was included in Other expense, net in our Condensed Consolidated Statements of Comprehensive Income and Losses on redemption of debt in our Condensed Consolidated Statements of Cash Flows.

On May 23, 2021, we redeemed $1.3 billion aggregate principal amount of our 6.000% Senior Notes due 2023, $1.0 billion aggregate principal amount of our 6.000% Senior Notes due 2024 and $500 million aggregate principal amount of our 5.125% Senior Notes due 2025. The notes were redeemed at a redemption price equal to 100.000%, 100.000% and 101.281% of the principal amount of the notes (plus accrued and unpaid interest thereon), respectively, and were paid on May 21, 2021. The redemption premium of our 5.125% Senior Notes due 2025 was $6 million, and the write off of issuance costs and consent fees of our 6.000% Senior Notes due 2023, 6.000% Senior Notes due 2024 and 5.125% Senior Notes due 2025 was approximately $10 million, $9 million and $3 million, respectively, which were included in Other expense, net in our Condensed Consolidated Statements of Comprehensive Income and Losses on redemption of debt in our Condensed Consolidated Statements of Cash Flows.

Subsequent to June 30, 2021, on August 2, 2021, we delivered a notice of prepayment on the remaining aggregate principal amount of our 3.360% Secured Series 2016-1 A-1 Notes due 2021. The aggregate principal amount, plus accrued and unpaid interest, of approximately $220 million is expected to be paid on or around August 20, 2021.

Restricted Cash

Certain provisions of our debt agreements require us to maintain specified cash collateral balances. Amounts associated with these balances are considered to be restricted cash.

Note 8 – Tower Obligations

Existing CCI Tower Lease Arrangements

In 2012, we conveyed to Crown Castle International Corp. (“CCI”) the exclusive right to manage and operate approximately 6,200 tower sites (“CCI Lease Sites”) via a master prepaid lease with site lease terms ranging from 23 to 37 years (the “2012 Tower Transaction”). CCI has fixed-price purchase options for the CCI Lease Sites totaling approximately $2.0 billion, exercisable at the end of the lease term. We lease back a portion of the space at certain tower sites for an initial term of 10 years, followed by optional renewals at customary terms.

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Assets and liabilities associated with the operation of the tower sites were transferred to special purpose entities (“SPEs”). Assets included ground lease agreements or deeds for the land on which the towers are situated, the towers themselves and existing subleasing agreements with other mobile network operator tenants that lease space at the tower sites. Liabilities included the obligation to pay ground lease rentals, property taxes and other executory costs.

We determined the SPEs containing the CCI Lease Sites (“Lease Site SPEs”) are VIEs as they lack sufficient equity to finance their activities. We have a variable interest in the Lease Site SPEs but are not the primary beneficiary as we lack the power to direct the activities that most significantly impact the Lease Site SPEs’ economic performance. These activities include managing tenants and underlying ground leases, performing repair and maintenance on the towers, the obligation to absorb expected losses and the right to receive the expected future residual returns from the purchase option to acquire the CCI Lease Sites. As we determined that we are not the primary beneficiary and do not have a controlling financial interest in the Lease Site SPEs, the Lease Site SPEs are not included in our condensed consolidated financial statements.

However, we also considered if this arrangement resulted in the sale of the CCI Lease Sites for which we would de-recognize the tower assets. By assessing whether control had transferred, we concluded that transfer of control criteria, as discussed in the revenue standard, were not met. Accordingly, we recorded this arrangement as a financing whereby we recorded debt, a financial obligation, and the CCI Lease Sites tower assets remained on our balance sheet. We recorded long-term financial obligations in the amount of the net proceeds received and recognize interest on the tower obligations at a rate of approximately 8% using the effective interest method. The tower obligations are increased by interest expense and amortized through contractual leaseback payments made by us to CCI and through net cash flows generated and retained by CCI from operation of the tower sites.

Acquired CCI Tower Lease Arrangements

Prior to the Merger, Sprint entered into a lease-out and leaseback arrangement with Global Signal Inc., a third party that was subsequently acquired by CCI, that conveyed to CCI the exclusive right to manage and operate approximately 6,400 tower sites (“Master Lease Sites”) via a master prepaid lease. These agreements were assumed upon the close of the Merger, at which point the remaining term of the lease-out was approximately 17 years with no renewal options. CCI has a fixed price purchase option for all (but not less than all) of the leased or subleased sites for approximately $2.3 billion, exercisable one year prior to the expiration of the agreement and ending 120 days prior to the expiration of the agreement. We lease back a portion of the space at certain tower sites for an initial term of 10 years, followed by optional renewals at customary terms.

We considered if this arrangement resulted in the sale of the Master Lease Sites for which we would de-recognize the tower assets. By assessing whether control had transferred, we concluded that transfer of control criteria, as discussed in the revenue standard, were not met. Accordingly, we recorded this arrangement as a financing whereby we recorded debt, a financial obligation, and the Master Lease Sites tower assets remained on our balance sheet.

As of the closing date of the Merger, we recognized Property and equipment with a fair value of $2.8 billion and tower obligations related to amounts owed to CCI under the leaseback of $1.1 billion. Additionally, we recognized $1.7 billion in Other long-term liabilities associated with contract terms that are unfavorable to current market rates, which includes unfavorable terms associated with the fixed-price purchase option in 2037.

We recognize interest expense on the tower obligations at a rate of approximately 6% using the effective interest method. The tower obligations are increased by interest expense and amortized through contractual leaseback payments made by us to CCI. The tower assets are reported in Property and equipment, net in our Condensed Consolidated Balance Sheets and are depreciated to their estimated residual values over the expected useful life of the towers, which is 20 years.

The following table summarizes the balances associated with both of the tower arrangements in the Condensed Consolidated Balance Sheets:
(in millions) June 30,
2021 		December 31,
2020
Property and equipment, net $ 2,634  $ 2,838 
Tower obligations 2,919  3,028 
Other long-term liabilities 1,712  1,712 

Future minimum payments related to the tower obligations are approximately $401 million for the year ending June 30, 2022, $664 million in total for the years ending June 30, 2023 and 2024, $603 million in total for the years ending June 30, 2025 and 2026, and $473 million in total for the years thereafter.
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We are contingently liable for future ground lease payments through the remaining term of the CCI Lease Sites and the Master Lease Sites. These contingent obligations are not included in Operating lease liabilities as any amount due is contractually owed by CCI based on the subleasing arrangement. Under the arrangement, we remain primarily liable for ground lease payments on approximately 900 sites and have included lease liabilities of $282 million in our Operating lease liabilities as of June 30, 2021.

Note 9 – Revenue from Contracts with Customers

Disaggregation of Revenue

We provide wireless communications services to three primary categories of customers:

•Postpaid customers generally include customers who are qualified to pay after receiving wireless communications services utilizing phones, home internet, wearables, DIGITS (a service that allows our customers to use multiple mobile numbers on any compatible smartphone or device with internet connection), or other connected devices which includes tablets and SyncUP products;
•Prepaid customers generally include customers who pay for wireless communications services in advance; and
•Wholesale customers include Machine-to-Machine and Mobile Virtual Network Operator customers that operate on our network but are managed by wholesale partners.

Postpaid service revenues, including postpaid phone revenues and postpaid other revenues, were as follows:
Three Months Ended June 30, Six Months Ended June 30,
(in millions) 2021 2020 2021 2020
Postpaid service revenues
Postpaid phone revenues $ 9,667  $ 9,341  $ 19,150  $ 14,918 
Postpaid other revenues 825  618  1,645  928 
Total postpaid service revenues $ 10,492  $ 9,959  $ 20,795  $ 15,846 

We operate as a single operating segment. The balances presented within each revenue line item in our Condensed Consolidated Statements of Comprehensive Income represent categories of revenue from contracts with customers disaggregated by type of product and service. Service revenues also include revenues earned for providing premium services to customers, such as device insurance services. Revenue generated from the lease of mobile communication devices is included within Equipment revenues in our Condensed Consolidated Statements of Comprehensive Income.

We provide wireline communication services to domestic and international customers. Wireline service revenues were $187 million and $384 million for the three and six months ended June 30, 2021, respectively and were $211 million for both the three and six months ended June 30, 2020. Wireline service revenues are presented in Other service revenues in our Condensed Consolidated Statements of Comprehensive Income.

Equipment revenues from the lease of mobile communication devices were as follows:
Three Months Ended June 30, Six Months Ended June 30,
(in millions) 2021 2020 2021 2020
Equipment revenues from the lease of mobile communication devices $ 914  $ 1,421  $ 1,955  $ 1,586 

Contract Balances

The contract asset and contract liability balances from contracts with customers as of December 31, 2020 and June 30, 2021, were as follows:
(in millions) Contract Assets Contract Liabilities
Balance as of December 31, 2020 $ 278  $ 824 
Balance as of June 30, 2021 267  789 
Change $ (11) $ (35)

Contract assets primarily represent revenue recognized for equipment sales with promotional bill credits offered to customers that are paid over time and are contingent on the customer maintaining a service contract.
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The change in the contract asset balance includes customer activity related to new promotions, offset by billings on existing contracts and impairment which is recognized as bad debt expense. The current portion of our Contract assets of approximately $206 million and $204 million as of June 30, 2021 and December 31, 2020, respectively, was included in Other current assets in our Condensed Consolidated Balance Sheets.

Contract liabilities are recorded when fees are collected, or we have an unconditional right to consideration (a receivable) in advance of delivery of goods or services. Changes in contract liabilities are primarily related to the activity of prepaid customers. Contract liabilities are primarily included in Deferred revenue in our Condensed Consolidated Balance Sheets.

Revenues for the three and six months ended June 30, 2021 and 2020 include the following:
Three Months Ended June 30, Six Months Ended June 30,
(in millions) 2021 2020 2021 2020
Amounts included in the beginning of year contract liability balance $ 41  $ 10  $ 724  $ 538 

Remaining Performance Obligations

As of June 30, 2021, the aggregate amount of transaction price allocated to remaining service performance obligations for postpaid contracts with subsidized devices and promotional bill credits that result in an extended service contract is $1.2 billion. We expect to recognize revenue as the service is provided on these postpaid contracts over an extended contract term of 24 months.

As of June 30, 2021, the aggregate amount of transaction price allocated to remaining service and lease performance obligations associated with operating leases was $668 million and $403 million, respectively. We expect to recognize this revenue as service is provided over the lease contract term of 18 months.

Information about remaining performance obligations that are part of a contract that has an original expected duration of one year or less have been excluded from the above, which primarily consists of monthly service contracts.

Certain of our wholesale, roaming and service contracts include variable consideration based on usage. This variable consideration has been excluded from the disclosure of remaining performance obligations. As of June 30, 2021, the aggregate amount of the contractual minimum consideration for wholesale, roaming and service contracts is $805 million, $1.4 billion and $1.0 billion for 2021, 2022, and 2023 and beyond, respectively. These contracts have a remaining duration ranging from less than one year to nine years.

Contract Costs

The total balance of deferred incremental costs to obtain contracts was $1.2 billion and $1.1 billion as of June 30, 2021 and December 31, 2020, respectively, and is included in Other assets in our Condensed Consolidated Balance Sheets. Deferred contract costs incurred to obtain postpaid service contracts are amortized over a period of 24 months. The amortization period is monitored to reflect any significant change in assumptions. Amortization of deferred contract costs is included in Selling, general and administrative expenses in our Condensed Consolidated Statements of Comprehensive Income and was $264 million and $205 million for the three months ended June 30, 2021 and 2020, respectively, and $512 million and $410 million for the six months ended June 30, 2021 and 2020, respectively.

The deferred contract cost asset is assessed for impairment on a periodic basis. There were no impairment losses recognized on deferred contract cost assets for the three and six months ended June 30, 2021 and 2020.

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Note 10 – Earnings Per Share

The computation of basic and diluted earnings per share was as follows:
Three Months Ended June 30, Six Months Ended June 30,
(in millions, except shares and per share amounts) 2021 2020 2021 2020
Income (loss) from continuing operations $ 978  $ (210) $ 1,911  $ 741 
Income from discontinued operations, net of tax —  320  —  320 
Net income $ 978  $ 110  $ 1,911  $ 1,061 
Weighted average shares outstanding - basic 1,247,563,331  1,236,528,444  1,245,552,847  1,047,338,364 
Effect of dilutive securities:
Outstanding stock options and unvested stock awards 6,154,791  —  8,711,617  9,782,025 
Weighted average shares outstanding - diluted 1,253,718,122  1,236,528,444  1,254,264,464  1,057,120,389 
Basic earnings (loss) per share:
Continuing operations $ 0.78  $ (0.17) $ 1.53  $ 0.71 
Discontinued operations —  0.26  —  0.30 
Earnings per share - basic $ 0.78  $ 0.09  $ 1.53  $ 1.01 
Diluted earnings (loss) per share:
Continuing operations $ 0.78  $ (0.17) $ 1.52  $ 0.70 
Discontinued operations —  0.26  —  0.30 
Earnings per share - diluted $ 0.78  $ 0.09  $ 1.52  $ 1.00 
Potentially dilutive securities:
Outstanding stock options and unvested stock awards 50,873  10,234,947  26,646  443,679 
SoftBank contingent consideration (1)
48,751,557  48,751,557  48,751,557  24,375,778 
(1)     Represents the weighted average SoftBank Specified Shares that are contingently issuable from the acquisition date of April 1, 2020.

As of June 30, 2021, we had authorized 100 million shares of preferred stock, with a par value of $0.00001 per share. There was no preferred stock outstanding as of June 30, 2021 and 2020. Potentially dilutive securities were not included in the computation of diluted earnings per share if to do so would have been anti-dilutive or if there was a loss from continuing operations for the period.

The SoftBank Specified Shares Amount of 48,751,557 shares of T-Mobile common stock was determined to be contingent consideration for the Merger and is not dilutive until the defined volume-weighted average price per share is reached.

Note 11 – Commitments and Contingencies

Purchase Commitments

We have commitments for non-dedicated transportation lines with varying expiration terms that generally extend through 2029. In addition, we have commitments to purchase wireless devices, network services, equipment, software, marketing sponsorship agreements and other items in the ordinary course of business, with various terms through 2043.

Our purchase commitments are approximately $3.9 billion for the year ending June 30, 2022, $4.5 billion in total for the years ending June 30, 2023 and 2024, $2.3 billion in total for the years ending June 30, 2025 and 2026 and $1.6 billion in total for the years thereafter. These amounts are not reflective of our entire anticipated purchases under the related agreements but are determined based on the non-cancelable quantities or termination amounts to which we are contractually obligated.

Spectrum Leases

In connection with the Merger, we assumed certain spectrum lease contracts from Sprint that include service obligations to the lessors. Certain of the spectrum leases provide for minimum lease payments, additional charges, renewal options and escalation clauses. Leased spectrum agreements have varying expiration terms that generally extend through 2050. We expect that all renewal periods in our spectrum leases will be exercised by us.

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Our spectrum lease and service credit commitments, including renewal periods, are approximately $339 million for the year ending June 30, 2022, $624 million in total for the years ending June 30, 2023 and 2024, $582 million in total for the years ending June 30, 2025 and 2026 and $4.9 billion in total for the years thereafter.

We accrue a monthly obligation for the services and equipment based on the total estimated available service credits divided by the term of the lease. The obligation is reduced by services provided and as actual invoices are presented and paid to the lessors. The maximum remaining service commitment on June 30, 2021 was $89 million and is expected to be incurred over the term of the related lease agreements, which generally range from 15 to 30 years.

Merger Commitments

In connection with the regulatory proceedings and approvals of the Transactions, we have commitments and other obligations to various state and federal agencies and certain nongovernmental organizations, including pursuant to the Consent Decree agreed to by us, DT, Sprint, SoftBank and DISH Network Corporation (“DISH”) and entered by the U.S. District Court for the District of Columbia, and the FCC’s memorandum opinion and order approving our applications for approval of the Merger. These commitments and obligations include, among other things, extensive 5G network build-out commitments, obligations to deliver high-speed wireless services to the vast majority of Americans, including Americans residing in rural areas, and the marketing of an in-home broadband product where spectrum capacity is available. Other commitments relate to national security, pricing, service, employment and support of diversity initiatives. Many of the commitments specify time frames for compliance. Failure to fulfill our obligations and commitments in a timely manner could result in substantial fines, penalties, or other legal and administrative actions.

We expect that our monetary commitments associated with these matters are approximately $9 million for the year ending June 30, 2022, $13 million in total for the years ending June 30, 2023 and 2024 and $3 million in total for the years ending June 30, 2025 and 2026. These amounts do not represent our entire anticipated costs to achieve specified network coverage and performance requirements, employment targets or commitments to provide access to affordable rate plans, but represent only those amounts for which we are required to make a specified payment in connection with our commitments or settlements.

Contingencies and Litigation

Litigation Matters

We are involved in various lawsuits and disputes, claims, government agency investigations and enforcement actions, and other proceedings (“Litigation Matters”) that arise in the ordinary course of business, which include claims of patent infringement (most of which are asserted by non-practicing entities primarily seeking monetary damages), class actions, and proceedings to enforce FCC rules and regulations. Those Litigation Matters are at various stages, and some of them may proceed to trial, arbitration, hearing, or other adjudication that could result in fines, penalties, or awards of monetary or injunctive relief in the coming 12 months if they are not otherwise resolved. We have established an accrual with respect to certain of these matters, where appropriate, which is reflected in the condensed consolidated financial statements but that is not considered to be, individually or in the aggregate, material. An accrual is established when we believe it is both probable that a loss has been incurred and an amount can be reasonably estimated. For other matters, where we have not determined that a loss is probable or because the amount of loss cannot be reasonably estimated, we have not recorded an accrual due to various factors typical in contested proceedings, including, but not limited to, uncertainty concerning legal theories and their resolution by courts or regulators, uncertain damage theories and demands, and a less than fully developed factual record. For Litigation Matters which may result in a contingent gain, we recognize such gains in the condensed consolidated financial statements when the gain is realized or realizable. We do not expect that the ultimate resolution of these Litigation Matters, individually or in the aggregate, will have a material adverse effect on our financial position, but we note that an unfavorable outcome of some or all of the specific matters identified below could have a material adverse impact on results of operations or cash flows for a particular period. This assessment is based on our current understanding of relevant facts and circumstances. As such, our view of these matters is subject to inherent uncertainties and may change in the future.

On February 28, 2020, we received a Notice of Apparent Liability for Forfeiture and Admonishment from the FCC, which proposed a penalty against us for allegedly violating section 222 of the Communications Act and the FCC’s regulations governing the privacy of customer information. In the first quarter of 2020, we recorded an accrual for an estimated payment amount. We maintained the accrual as of June 30, 2021, which was included in Accounts payable and accrued liabilities in our Condensed Consolidated Balance Sheets.

On April 1, 2020, in connection with the closing of the Merger, we assumed the contingencies and litigation matters of Sprint. Those matters include a wide variety of disputes, claims, government agency investigations and enforcement actions, and other
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proceedings. These matters include, among other things, certain ongoing FCC and state government agency investigations into Sprint’s Lifeline program. In September 2019, Sprint notified the FCC that it had claimed monthly subsidies for serving subscribers even though these subscribers may not have met usage requirements under Sprint's usage policy for the Lifeline program, due to an inadvertent coding issue in the system used to identify qualifying subscriber usage that occurred in July 2017 while the system was being updated. Sprint has made a number of payments to reimburse the federal government and certain states for excess subsidy payments.

We note that pursuant to Amendment No. 2 to the Business Combination Agreement, SoftBank agreed to indemnify us against certain specified matters and losses, including those relating to Lifeline matters. Resolution of these matters could require making additional reimbursements and paying additional fines and penalties, which we do not expect to have a significant impact on our financial results. We expect that any additional liabilities related to these indemnified matters would be indemnified and reimbursed by SoftBank. See Note 2 - Business Combinations for further information.

On June 4, 2021, a putative shareholder class action and derivative action was filed in the Delaware Court of Chancery, Dinkevich v. Deutsche Telekom AG, et al., Case No. C.A. No. 2021-0479, against DT, SoftBank and certain of our current and former officers and directors, asserting breach of fiduciary duty claims relating to the repricing amendment to the Business Combination Agreement, and to SoftBank’s monetization of its T-Mobile shares. We are also named as a nominal defendant in the case. We are unable to predict the potential outcome of these claims. We intend to vigorously defend this lawsuit.

Note 12 – Restructuring Costs

Upon close of the Merger, we began implementing restructuring initiatives to realize cost efficiencies and reduce redundancies. The major activities associated with the restructuring initiatives to date include contract termination costs associated with the rationalization of retail stores, distribution channels, duplicative network and backhaul services and other agreements, severance costs associated with the integration of redundant processes and functions and the decommissioning of certain small cell sites and distributed antenna systems to achieve synergies in network costs.

The following table summarizes the expenses incurred in connection with our restructuring initiatives:
(in millions) Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Incurred to Date
Contract termination costs $ 3  $ 9  $ 187 
Severance costs 3  19  404 
Network decommissioning 42  54  551 
Total restructuring plan expenses $ 48  $ 82  $ 1,142 

The expenses associated with the restructuring initiatives are included in Costs of services and Selling, general and administrative in our Condensed Consolidated Statements of Comprehensive Income.

Our restructuring initiatives also include the acceleration or termination of certain of our operating and financing leases for cell sites, switch sites, retail stores, network equipment and office facilities. Incremental expenses associated with accelerating amortization of the right-of-use assets on lease contracts were $261 million and $384 million for the three and six months ended June 30, 2021, respectively, and are included within Costs of services and Selling, general and administrative in our Condensed Consolidated Statements of Comprehensive Income. No restructuring expenses were incurred related to the acceleration or termination of leases for the three and six months ended June 30, 2020.

The changes in the liabilities associated with our restructuring initiatives, including expenses incurred and cash payments, are as follows:
(in millions) December 31,
2020 		Expenses Incurred Cash Payments
Adjustments for Non-Cash Items (1)
June 30,
2021
Contract termination costs $ 81  $ 9  $ (65) $ —  $ 25 
Severance costs 52  19  (53) (4) 14 
Network decommissioning 30  54  (29) (16) 39 
Total $ 163  $ 82  $ (147) $ (20) $ 78 
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(1)    Non-cash items consists of non-cash stock-based compensation included within Severance costs and the write-off of assets within Network decommissioning.

The liabilities accrued in connection with our restructuring initiatives are presented in Accounts payable and accrued liabilities in our Condensed Consolidated Balance Sheets.

Our restructuring activities are expected to occur over the next three years with substantially all costs incurred by the end of fiscal year 2023. We are evaluating additional restructuring initiatives, which are dependent on consultations and negotiation with certain counterparties and the expected impact on our business operations, which could affect the amount or timing of the restructuring costs and related payments.

Note 13 – Additional Financial Information

Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities are summarized as follows:
(in millions) June 30,
2021 		December 31,
2020
Accounts payable $ 3,855  $ 5,564 
Payroll and related benefits 1,149  1,163 
Property and other taxes, including payroll 1,589  1,540 
Interest 769  771 
Commissions 257  399 
Toll and interconnect 331  217 
Advertising 65  135 
Other 396  407 
Accounts payable and accrued liabilities $ 8,411  $ 10,196 

Book overdrafts included in accounts payable and accrued liabilities were $281 million and $628 million as of June 30, 2021 and December 31, 2020, respectively.

Supplemental Consolidated Statements of Cash Flows Information

The following table summarizes T-Mobile’s supplemental cash flow information:
Three Months Ended June 30, Six Months Ended June 30,
(in millions) 2021 2020 2021 2020
Interest payments, net of amounts capitalized $ 913  $ 608  $ 1,858  $ 949 
Operating lease payments 1,263  1,269  2,914  2,144 
Income tax payments 63  31  85  55 
Non-cash investing and financing activities
Non-cash beneficial interest obtained in exchange for securitized receivables 1,089  1,486  2,470  3,099 
Non-cash consideration for the acquisition of Sprint —  33,533  —  33,533 
Change in accounts payable and accrued liabilities for purchases of property and equipment (367) (38) (540) (339)
Leased devices transferred from inventory to property and equipment 333  1,444  818  1,753 
Returned leased devices transferred from property and equipment to inventory (416) (538) (861) (597)
Short-term debt assumed for financing of property and equipment —  38  —  38 
Operating lease right-of-use assets obtained in exchange for lease obligations 1,043  658  1,954  1,213 
Financing lease right-of-use assets obtained in exchange for lease obligations 377  515  486  693 

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Index for Notes to the Condensed Consolidated Financial Statements
Note 14 – Subsequent Events

Subsequent to June 30, 2021, on July 1, 2021, we closed on the acquisition of Shentel’s Wireless Assets pursuant to the Purchase Agreement dated May 28, 2021, and as a result, T-Mobile become the legal owner of the Wireless Assets. Concurrently and as agreed to through the Purchase Agreement, T-Mobile and Shentel entered into certain separate transactions, including the effective settlement of the pre-existing arrangement between T-Mobile and Shentel under the Management Agreement. See Note 2 – Business Combinations for further information.

Subsequent to June 30, 2021, on July 23, 2021, the FCC issued to us the licenses won in Auction 107. See Note 5 – Goodwill, Spectrum License Transactions and Other Intangible Assets for further information.

Subsequent to June 30, 2021, on August 2, 2021, we delivered a notice of prepayment on the remaining aggregate principal amount of our 3.360% Secured Series 2016-1 A-1 Notes due 2021. The aggregate principal amount, plus accrued and unpaid interest, of approximately $220 million is expected to be paid on or around August 20, 2021. See Note 7 - Debt for further information.


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Table of Contents
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Statement Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q (“Form 10-Q”) includes 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 Risk Factors included in Part II, Item 1A of this Form 10-Q, could affect future results and cause those results to differ materially from those expressed in the forward-looking statements:
•natural disasters, public health crises, including the COVID-19 pandemic (the “Pandemic”), terrorist attacks or similar incidents;
•adverse economic, political or market conditions in the U.S. and international markets, including those caused by the Pandemic;
•competition, industry consolidation and changes in the market condition for wireless services;
•data loss or other security breaches;
•the scarcity and cost of additional wireless spectrum, and regulations relating to spectrum use;
•our inability to retain or motivate key personnel, hire qualified personnel or maintain our corporate culture;
•our inability to take advantage of technological developments on a timely basis;
•system failures and business disruptions, allowing for unauthorized use of or interference with our network and other systems;
•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 (as defined below), including the acquisition by DISH Network Corporation (“DISH”) of the prepaid wireless business operated under the Boost Mobile and Sprint prepaid brands (excluding the Assurance brand Lifeline customers and the prepaid wireless customers of Shenandoah Personal Communications Company LLC (“Shentel”) and Swiftel Communications, Inc.), including customer accounts, inventory, contracts, intellectual property and certain other specified assets (the “Prepaid Business”), and the assumption of certain related liabilities (the “Prepaid Transaction”), the complaint and proposed final judgment (the “Consent Decree”) agreed to by us, Deutsche Telekom AG (“DT”), Sprint Corporation (“Sprint”), SoftBank Group Corp. (“SoftBank”) and 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 (collectively, the “Government Commitments”), and the challenges in satisfying the Government Commitments in the required time frames and the significant cumulative cost incurred in tracking, monitoring and complying with them;
•our inability to manage 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 (collectively, the “Divestiture Transaction”), and known or unknown liabilities arising in connection therewith;
•the effects of any future acquisition, investment, or merger involving us;
•any disruption or failure of our third parties (including key suppliers) to provide products or services for the operation of our business;
•the occurrence of high fraud rates or volumes related to device financing, customer payment cards, third-party dealers, employees, subscriptions, identities or account takeover fraud;
•our substantial level of indebtedness and our inability to service our debt obligations in accordance with their terms or to comply with the restrictive covenants contained therein;
•adverse changes in the ratings of our debt securities or adverse conditions in the credit markets;
•the risk of future material weaknesses we may identify while we work to integrate and align policies, principles and practices of the two companies following the Merger (as defined below), or any other failure by us to maintain effective internal controls, and the resulting significant costs and reputational damage;
•any changes in regulations or in the regulatory framework under which we operate;
•laws and regulations relating to the handling of privacy and data protection;
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•unfavorable outcomes of existing or future legal proceedings;
•our offering of regulated financial services products and exposure to a wide variety of state and federal regulations;
•new or amended tax laws or regulations or administrative interpretations and judicial decisions affecting the scope or application of tax laws or regulations;
•the possibility that we may be unable to renew our spectrum leases on attractive terms or the possible revocation of our existing licenses in the event that we violate applicable laws;
•interests of our significant stockholders that may differ from the interests of other stockholders;
•future sales of our common stock by DT and SoftBank and our inability to attract additional equity financing outside the United States due to foreign ownership limitations by the FCC;
•the volatility of our stock price and our lack of plan to pay cash dividends in the foreseeable future;
•failure to realize the expected benefits and synergies of the merger (the “Merger”) with Sprint, pursuant to the Business Combination Agreement with Sprint and the other parties named therein (as amended, the “Business Combination Agreement”) and the other transactions contemplated by the Business Combination Agreement (collectively, the “Transactions”) in the expected time frames or in the amounts anticipated;
•any delay and costs of, or difficulties in, integrating our business and Sprint’s business and operations, and unexpected additional operating costs, customer loss and business disruptions, including challenges in maintaining relationships with employees, customers, suppliers or vendors;
•unanticipated difficulties, disruption, or significant delays in our long-term strategy to migrate Sprint’s legacy customers onto T-Mobile’s existing billing platforms; and
•changes to existing or the issuance of new accounting standards by the Financial Accounting Standards Board or other regulatory agencies.

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 the results of any revision to these forward-looking statements, except as required by law. In this Form 10-Q, unless the context indicates otherwise, references to “T-Mobile,” “our Company,” “the Company,” “we,” “our,” and “us” refer to T-Mobile US, Inc. as a stand-alone company prior to April 1, 2020, the date we completed the Merger with Sprint, and on and after April 1, 2020, refer to the combined company as a result of the Merger.

Investors and others should note that we announce material financial and operational information to our investors using our investor relations website, press releases, SEC filings and public conference calls and webcasts. We intend to also use certain social media accounts as means of disclosing information about us and our services and for complying with our disclosure obligations under Regulation FD (the @TMobileIR Twitter account (https://twitter.com/TMobileIR) and the @MikeSievert Twitter account (https://twitter.com/MikeSievert), which Mr. Sievert also uses as a means for personal communications and observations). The information we post through these social media channels may be deemed material. Accordingly, investors should monitor these social media channels in addition to following our press releases, SEC filings and public conference calls and webcasts. The social media channels that we intend to use as a means of disclosing the information described above may be updated from time to time as listed on our Investor Relations website.

Overview

The objectives of our Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) are to provide users of our condensed consolidated financial statements with the following:

•A narrative explanation from the perspective of management of our financial condition, results of operations, cash flows, liquidity and certain other factors that may affect future results;
•Context to the financial statements; and
•Information that allows assessment of the likelihood that past performance is indicative of future performance.

Our MD&A is performed on a consolidated basis and is inclusive of the results and operations of Sprint prospectively from the close of the Merger on April 1, 2020. The Merger enhanced our spectrum portfolio, increased our customer base, altered our product mix and created opportunities for synergies in our operations. We anticipate an initial increase in our combined operating costs, which we expect to decrease as we realize synergies. We expect the trends and results of operations of the combined company to be materially different than those of the standalone entities.

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Our MD&A is provided as a supplement to, and should be read together with, our unaudited condensed consolidated financial statements for the three and six months ended June 30, 2021, included in Part I, Item 1 of this Form 10-Q and audited consolidated financial statements included in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2020. Except as expressly stated, the financial condition and results of operations discussed throughout our MD&A are those of T-Mobile US, Inc. and its consolidated subsidiaries.

Sprint Merger

Transaction Overview

On April 1, 2020, we completed the Merger with Sprint, a communications company offering a comprehensive range of wireless and wireline communications products and services. As a result, Sprint and its subsidiaries became wholly owned consolidated subsidiaries of T-Mobile.

The Merger has altered the size and scope of our operations, impacting our assets, liabilities, obligations, capital requirements and performance measures. We expect the trends and results of operations of the combined company to be materially different than those of the standalone entities. As a combined company, we have been able to enhance the breadth and depth of our nationwide 5G network, accelerate innovation, increase competition in the U.S. wireless 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.

For more information regarding the Merger, see Note 2 – Business Combinations of the Notes to the Condensed Consolidated Financial Statements.

Merger-Related Costs

Merger-related costs generally include:

•Integration costs to achieve efficiencies in network, retail, information technology and back office operations;
•Restructuring costs, including severance, store rationalization and network decommissioning; and
•Transaction costs, including legal and professional services related to the completion of the Merger and acquisitions of affiliates.

Transaction and restructuring costs are disclosed in Note 2 – Business Combinations and Note 12 - Restructuring Costs, respectively. Merger-related costs have been excluded from our calculations of Adjusted EBITDA and Core Adjusted EBITDA, which are non-GAAP financial measures, as we do not consider these costs to be reflective of our ongoing operating performance. See “Adjusted EBITDA and Core Adjusted EBITDA” in the “Performance Measures” section of this MD&A. Cash payments for Merger-related costs, including payments related to our restructuring plan, are included in Net cash provided by operating activities in our Condensed Consolidated Statements of Cash Flows.

Merger-related costs during the three and six months ended June 30, 2021 and 2020, are presented below:
(in millions) Three Months Ended June 30, Change Six Months Ended
June 30, 		Change
2021 2020 $ % 2021 2020 $ %
Merger-related costs
Cost of services, exclusive of depreciation and amortization $ 273  $ 40  $ 233  583  % $ 409  $ 40  $ 369  923  %
Cost of equipment sales 87  —  87  NM 104  —  104  NM
Selling, general and administrative 251  758  (507) (67) % 396  901  (505) (56) %
Total Merger-related costs $ 611  $ 798  $ (187) (23) % $ 909  $ 941  $ (32) (3) %
Cash payments for Merger-related costs $ 190  $ 370  $ (180) (49) % $ 467  $ 531  $ (64) (12) %
NM - Not Meaningful

Merger-related costs will be impacted by restructuring and integration activities expected to occur over the next three years as we implement initiatives to realize cost efficiencies from the Merger. Transaction costs, including legal and professional service
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fees related to the completion of the Merger and acquisitions of affiliates, are expected to continue to decrease in periods subsequent to the close of the Merger.

Restructuring

Upon the close of the Merger, we began implementing restructuring initiatives to realize cost efficiencies from the Merger. The major activities associated with the restructuring initiatives to date include:

•Contract termination costs associated with rationalization of retail stores, distribution channels, duplicative network and backhaul services and other agreements;
•Severance costs associated with the reduction of redundant processes and functions; and
•The decommissioning of certain small cell sites and distributed antenna systems to achieve synergies in network costs.

Anticipated Impacts

Our restructuring activities are expected to occur over the next three years with substantially all costs incurred by the end of fiscal year 2023. We are evaluating additional restructuring initiatives which are dependent on consultations and negotiation with certain counterparties and the expected impact on our business operations, which could affect the amount or timing of the restructuring costs and related payments. We expect our principal sources of funding to be sufficient to meet our liquidity requirements and anticipated payments associated with the restructuring initiatives.

As a result of our ongoing restructuring activities, we expect to realize cost efficiencies by eliminating redundancies within our combined network as well as other business processes and operations. We expect these activities to result in a reduction of expenses within Cost of services and Selling, general and administrative in our Condensed Consolidated Statements of Comprehensive Income.

For more information regarding our restructuring activities, see Note 12 – Restructuring Costs of the Notes to the Condensed Consolidated Financial Statements.

COVID-19 Pandemic

The Pandemic has resulted in a widespread health crisis that has adversely affected businesses, economies, and financial markets worldwide, and has caused significant volatility in the U.S. and international debt and equity markets. The impact of the Pandemic has been wide-ranging, including, but not limited to, the temporary closures of many businesses and schools, “shelter in place” orders, travel restrictions, social distancing guidelines and other governmental, business and individual actions taken in response to the Pandemic. These restrictions have impacted, and will continue to impact, our business, including the demand for our products and services and the ways in which our customers purchase and use them. In addition, the Pandemic has resulted in economic uncertainty and a significant increase in unemployment in the United States, which could affect our customers’ purchasing decisions and ability to make timely payments. Beginning in the first quarter of 2020, the Pandemic has peaked, subsided and seen a resurgence, leading to phased re-openings, as well as continuing or renewed containment measures. The availability of vaccines, as well as our continued social distancing measures and incremental cleaning efforts, have facilitated the continued operation of our retail stores, after certain closures during 2020. We will continue to monitor the Pandemic and its impacts and may adjust our actions as needed to continue to provide our products and services to our communities and employees.

As a critical communications infrastructure provider as designated by the government, our focus has been on providing crucial connectivity to our customers and impacted communities while ensuring the safety and well-being of our employees.

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Results of Operations

Set forth below is a summary of our consolidated financial results:
Three Months Ended June 30, Change Six Months Ended
June 30, 		Change
(in millions) 2021 2020 $ % 2021 2020 $ %
Revenues
Postpaid revenues $ 10,492  $ 9,959  $ 533  5  % $ 20,795  $ 15,846  $ 4,949  31  %
Prepaid revenues 2,427  2,311  116  5  % 4,778  4,684  94  2  %
Wholesale revenues 935  408  527  129  % 1,832  733  1,099  150  %
Other service revenues 638  552  86  16  % 1,279  813  466  57  %
Total service revenues 14,492  13,230  1,262  10  % 28,684  22,076  6,608  30  %
Equipment revenues 5,215  4,269  946  22  % 10,561  6,386  4,175  65  %
Other revenues 243  172  71  41  % 464  322  142  44  %
Total revenues 19,950  17,671  2,279  13  % 39,709  28,784  10,925  38  %
Operating expenses
Cost of services, exclusive of depreciation and amortization shown separately below 3,491  3,098  393  13  % 6,875  4,737  2,138  45  %
Cost of equipment sales, exclusive of depreciation and amortization shown separately below 5,453  3,667  1,786  49  % 10,595  6,196  4,399  71  %
Selling, general and administrative 4,823  5,604  (781) (14) % 9,628  9,292  336  4  %
Impairment expense —  418  (418) (100) % —  418  (418) (100) %
Depreciation and amortization 4,077  4,064  13  —  % 8,366  5,782  2,584  45  %
Total operating expenses 17,844  16,851  993  6  % 35,464  26,425  9,039  34  %
Operating income 2,106  820  1,286  157  % 4,245  2,359  1,886  80  %
Other income (expense)
Interest expense (820) (776) (44) 6  % (1,612) (961) (651) 68  %
Interest expense to affiliates (32) (63) 31  (49) % (78) (162) 84  (52) %
Interest income 2  6  (4) (67) % 5  18  (13) (72) %
Other expense, net (1) (195) 194  (99) % (126) (205) 79  (39) %
Total other expense, net (851) (1,028) 177  (17) % (1,811) (1,310) (501) 38  %
Income (loss) from continuing operations before income taxes 1,255  (208) 1,463  (703) % 2,434  1,049  1,385  132  %
Income tax expense (277) (2) (275) NM (523) (308) (215) 70  %
Income (loss) from continuing operations 978  (210) 1,188  (566) % 1,911  741  1,170  158  %
Income from discontinued operations, net of tax —  320  (320) (100) % —  320  (320) (100) %
Net income $ 978  $ 110  $ 868  789  % $ 1,911  $ 1,061  $ 850  80  %
Statement of Cash Flows Data
Net cash provided by operating activities $ 3,779  $ 777  $ 3,002  386  % $ 7,440  $ 2,394  $ 5,046  211  %
Net cash used in investing activities (2,083) (6,356) 4,273  (67) % (13,322) (7,936) (5,386) 68  %
Net cash (used in) provided by financing activities (577) 15,628  (16,205) (104) % 3,297  15,175  (11,878) (78) %
Non-GAAP Financial Measures
Adjusted EBITDA 6,906  7,017  (111) (2) % 13,811  10,682  3,129  29  %
Core Adjusted EBITDA 5,992  5,596  396  7  % 11,856  9,096  2,760  30  %
Free Cash Flow, excluding gross payments for the settlement of interest rate swaps 1,671  1,441 230 16  % 2,975  2,173 802 37  %
NM - Not Meaningful

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The following discussion and analysis is for the three and six months ended June 30, 2021, compared to the same period in 2020 unless otherwise stated.

Total revenues increased $2.3 billion, or 13%, for the three months ended and increased $10.9 billion, or 38%, for the six months ended June 30, 2021. The components of these changes are discussed below.

Postpaid revenues increased $533 million, or 5%, for the three months ended and increased $4.9 billion, or 31%, for the six months ended June 30, 2021.

The increase for the three and six months ended June 30, 2021, was primarily from:

•Higher average postpaid accounts; and
•Higher postpaid ARPA. See “Postpaid ARPA” in the “Performance Measures” section of this MD&A.

Prepaid revenues increased $116 million, or 5%, for the three months ended and increased $94 million, or 2%, for the six months ended June 30, 2021, primarily from:

•Higher average prepaid customers; and
•Higher prepaid ARPU. See “Prepaid ARPU” in the “Performance Measures” section of this MD&A.

Wholesale revenues increased $527 million, or 129%, for the three months ended and increased $1.1 billion, or 150%, for the six months ended June 30, 2021, primarily from our Master Network Service Agreement with DISH, which went into effect on July 1, 2020, and the success of our other MVNO relationships.

Other service revenues increased $86 million, or 16%, for the three months ended and increased $466 million, or 57%, for the six months ended June 30, 2021.

The increase for the three months ended June 30, 2021, was primarily from higher advertising, roaming and Lifeline revenues.

The increase for the six months ended June 30, 2021, was primarily from:

•Inclusion of wireline operations acquired in the Merger;
•Higher Lifeline revenues, primarily due to operations acquired in the Merger; and
•Higher advertising revenues.

Equipment revenues increased $946 million, or 22%, for the three months ended and increased $4.2 billion, or 65%, for the six months ended June 30, 2021.

The increase for the three months ended June 30, 2021, was primarily from:

•An increase of $1.2 billion in device sales revenue, excluding purchased leased devices, primarily from:
•An increase in the number of devices sold due to increased retail store traffic due to closures arising from the Pandemic in the prior period; and
•Higher average revenue per device sold due to an increase in the high-end device mix;
•An increase of $150 million in sales of accessories, due to increased retail store traffic due to closures arising from the Pandemic in the prior period; and
•An increase of $97 million in liquidation revenues primarily due to a higher volume of returned devices; partially offset by
•A decrease of $507 million in lease revenues due to a lower number of customer devices under lease due to the continued planned shift in device financing from leasing to EIP.
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The increase for the six months ended June 30, 2021, was primarily from:

•An increase of $2.9 billion in device sales revenue, excluding purchased leased devices, primarily from:
•An increase in the number of devices sold due to increased retail store traffic due to closures arising from the Pandemic in the prior period and a larger customer base as a result of the Merger; and
•Higher average revenue per device sold due to an increase in the high-end device mix;
•An increase of $369 million in lease revenues due to a higher number of customer devices under lease, primarily from leases acquired in the Merger;
•An increase of $325 million in liquidation revenues primarily due to a higher volume of returned devices;
•An increase of $291 million in sales of accessories, due to increased retail store traffic due to closures arising from the Pandemic in the prior period and a larger customer base as a result of the Merger; and
•An increase of $227 million in sales of leased devices, primarily due to a larger base of leased devices as a result of the Merger.

Other revenues increased $71 million, or 41%, for the three months ended and increased $142 million, or 44%, for the six months ended June 30, 2021, primarily from:

•Higher interest income on our EIP receivables; and
•Higher revenue from our device recovery program.

Operating expenses increased $993 million, or 6%, for the three months ended and increased $9.0 billion, or 34%, for the six months ended June 30, 2021. The components of this change are discussed below.

Cost of services, exclusive of depreciation and amortization, increased $393 million, or 13%, for the three months ended and increased $2.1 billion, or 45%, for the six months ended June 30, 2021.

The increase for the three months ended June 30, 2021, was primarily from:

•An increase of $233 million in Merger-related costs including incremental costs associated with network decommissioning and integration; and
•An increase in site costs related to network integration and the continued build-out of our nationwide 5G network.

The increase for the six months ended June 30, 2021, was primarily from:

•An increase in expenses associated with leases and backhaul agreements acquired in the Merger and the continued build-out of our nationwide 5G network;
•An increase of $369 million in Merger-related costs including incremental costs associated with network decommissioning and integration; and
•Higher employee-related and benefit-related costs primarily due to increased headcount as a result of the Merger.

Cost of equipment sales, exclusive of depreciation and amortization, increased $1.8 billion, or 49%, for the three months ended and increased $4.4 billion, or 71%, for the six months ended June 30, 2021.

The increase for the three months ended June 30, 2021, was primarily from:

•An increase of $1.7 billion in device cost of equipment sales, excluding purchased leased devices, primarily from:
•An increase in the number of devices sold due to increased retail store traffic due to closures arising from the Pandemic in the prior period; and
•Higher average costs per device sold due to an increase in the high-end device mix; and
•An increase in cost of accessories, due to increased retail store traffic due to closures arising from the Pandemic in the prior period.
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The increase for the six months ended June 30, 2021, was primarily from:

•An increase of $3.8 billion in device cost of equipment sales, excluding purchased leased devices, primarily from:
•An increase in the number of devices sold due to increased retail store traffic due to closures arising from the Pandemic in the prior period and a larger customer base as a result of the Merger; and
•Higher average costs per device sold due to an increase in the high-end device mix;
•An increase of $196 million in costs related to the liquidation of a higher volume of returned devices primarily driven by a larger customer base as a result of the Merger;
•An increase of $196 million in leased device cost of equipment sales, primarily due to a larger base of leased devices as a result of the Merger; and
•An increase of $129 million in cost of accessories, due to increased retail store traffic due to closures arising from the Pandemic in the prior period and a larger customer base as a result of the Merger.

Selling, general and administrative expenses decreased $781 million, or 14%, for the three months ended and increased $336 million, or 4%, for the six months ended June 30, 2021.

The decrease for the three months ended June 30, 2021, was primarily from:

•Merger-related costs of $251 million primarily related to integration and restructuring, compared to $758 million of Merger-related costs in the three months ended June 30, 2020; and
•Lower bad debt expense; partially offset by
•Higher employee-related costs due to increased staffing and distribution to support growth initiatives.
•Selling, general and administrative expenses for the three months ended June 30, 2020 included $341 million of supplemental employee payroll, third-party commissions and cleaning-related COVID-19 costs. There were insignificant COVID-19 costs for the three months ended June 30, 2021.

The increase for the six months ended June 30, 2021, was primarily from:

•Higher advertising, external labor and professional services and lease expense; and
•Higher employee-related costs due to an increase in the number of employees primarily from the Merger; partially offset by
•Lower bad debt expense.
•Merger-related costs of $396 million primarily related to integration and restructuring, compared to $901 million of Merger-related costs in the six months ended June 30, 2020.
•Selling, general and administrative expenses for the six months ended June 30, 2020 included $458 million of supplemental employee payroll, third-party commissions and cleaning-related COVID-19 costs. There were insignificant COVID-19 costs for the six months ended June 30, 2021.

Depreciation and amortization was essentially flat for the three months ended and increased $2.6 billion, or 45%, for the six months ended June 30, 2021.

Depreciation and amortization was essentially flat for the three months ended June 30, 2021, and was primarily impacted by:

•Higher depreciation expense, excluding leased devices, due to network expansion from the continued build-out of our nationwide 5G network; mostly offset by
•Lower depreciation expense on leased devices resulting from a lower number of total customer devices under lease;
•Lower amortization of customer relationship intangibles; and
•Certain 4G-related network assets becoming fully depreciated.

The increase for the six months ended June 30, 2021, was primarily from:

•Higher depreciation expense, excluding leased devices, due to network expansion from the continued build-out of our
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nationwide 5G network;
•Higher depreciation expense on leased devices resulting from a larger base of leased devices as a result of the Merger; and
•Higher amortization from intangible assets acquired in the Merger; partially offset by
•Certain 4G-related network assets becoming fully depreciated.

Operating income, the components of which are discussed above, increased $1.3 billion, or 157%, for the three months ended and increased $1.9 billion, or 80%, for the six months ended June 30, 2021.

Interest expense increased $44 million, or 6%, for the three months ended and increased $651 million, or 68%, for the six months ended June 30, 2021, primarily due to higher average debt outstanding, partially offset by lower interest rates.

Interest expense to affiliates decreased $31 million, or 49%, for the three months ended and decreased $84 million, or 52%, for the six months ended June 30, 2021, primarily from the redemption of an aggregate principal amount of $5.25 billion of Senior Notes to affiliates in 2020.

Other expense, net decreased $194 million, or 99%, for the three months ended and decreased $79 million, or 39%, for the six months ended June 30, 2021, primarily from lower losses on the extinguishment of debt.

Income (loss) from continuing operations before income taxes, the components of which are discussed above, was income of $1.3 billion and a loss of $208 million for the three months ended June 30, 2021 and 2020, respectively, and was income of $2.4 billion and $1.0 billion for the six months ended June 30, 2021 and 2020, respectively.

Income tax expense increased $275 million for the three months ended and increased $215 million, or 70%, for the six months ended June 30, 2021.

The increase for the three months ended June 30, 2021, was primarily from:

•Higher income from continuing operations before income taxes; partially offset by
•A reduction in expenses that were not deductible for tax purposes including our Layer3 goodwill impairment and certain merger-related costs in the prior year. The effective tax rate was 22.0% and (0.7)% for the three months ended June 30, 2021 and 2020, respectively.

The increase for the six months ended June 30, 2021, was primarily from:

•Higher income from continuing operations before income taxes; partially offset by
•A reduction in expenses that were not deductible for tax purposes including our Layer3 goodwill impairment and certain merger-related costs in the prior year and an increase in excess tax benefits on stock compensation in the current year. The effective tax rate was 21.5% and 29.4% for the six months ended June 30, 2021 and 2020, respectively.

Income (loss) from continuing operations was income of $978 million and a loss of $210 million for the three months ended June 30, 2021 and 2020, respectively, and was income of $1.9 billion and income of $741 million for the six months ended June 30, 2021 and 2020, respectively.

The increase for the three months ended June 30, 2021, was primarily from:

•Higher Operating income; and
•Lower Other expense, net; partially offset by
•Higher Income tax expense.

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The increase for the six months ended June 30, 2021, was primarily from:

•Higher Operating income; and
•Lower Other expense, net; partially offset by
•Higher Interest expense; and
•Higher Income tax expense.

Income from discontinued operations, net of tax, was $320 million for the three and six months ended June 30, 2020, and consisted of the results of the Prepaid Business that was divested on July 1, 2020. There were no discontinued operations for the three and six months ended June 30, 2021.

Net income, the components of which are discussed above, increased $868 million, or 789%, for the three months ended and increased $850 million, or 80%, for the six months ended June 30, 2021.

Net income for the three months ended June 30, 2021, included the following:

•Merger-related costs, net of tax, of $453 million for the three months ended June 30, 2021, compared to $635 million for the three months ended June 30, 2020.
•Impairment expense of $366 million, net of tax, for the three months ended June 30, 2020, compared to no impairment expense for the three months ended June 30, 2021.
•The negative impact of supplemental employee payroll, third-party commissions and cleaning-related COVID-19 costs, net of tax, of $253 million for the three months ended June 30, 2020, compared to no impact for the three months ended June 30, 2021.

Net income for the six months ended June 30, 2021, included the following:

•Merger-related costs, net of tax, of $673 million for the six months ended June 30, 2021, compared to $752 million for the six months ended June 30, 2020.
•Impairment expense of $366 million, net of tax, for the six months ended June 30, 2020, compared to no impairment expense for the six months ended June 30, 2021.
•The negative impact of supplemental employee payroll, third-party commissions and cleaning-related COVID-19 costs, net of tax, of $339 million for the six months ended June 30, 2020, compared to no impact for the six months ended June 30, 2021.

Guarantor Financial Information

On April 1, 2020, in connection with the closing of the Merger, we assumed certain registered debt to third parties issued by Sprint, Sprint Communications, Inc. and Sprint Capital Corporation (collectively, the “Sprint Issuers”). Amounts previously disclosed for the estimated values of certain acquired assets and liabilities assumed have been adjusted based on additional information arising subsequent to the initial valuation. These revisions to the estimated values did not have a significant impact on our summarized financial information for the consolidated obligor group.

Pursuant to the applicable indentures and supplemental indentures, the Senior Notes to affiliates and third parties issued by T-Mobile USA, Inc. and the Sprint Issuers (collectively, the “Issuers”) are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by T-Mobile (“Parent”) and certain of Parent’s 100% owned subsidiaries (“Guarantor Subsidiaries”).

Pursuant to the applicable indentures and supplemental indentures, the Senior Secured Notes to third parties issued by T-Mobile USA, Inc. are fully and unconditionally guaranteed, jointly and severally, on a senior secured basis by Parent and the Guarantor Subsidiaries, except for the Unsecured Guarantees of Sprint Corporation, Sprint Communications, Inc., and Sprint Capital Corporation, which are provided on a senior unsecured basis.

The guarantees of the Guarantor Subsidiaries are subject to release in limited circumstances only upon the occurrence of certain customary conditions. The indentures, supplemental indentures and credit agreements governing the long-term debt contain covenants that, among other things, limit the ability of the Issuers or borrowers and the Guarantor Subsidiaries to incur more
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debt, pay dividends and make distributions, make certain investments, repurchase stock, create liens or other encumbrances, enter into transactions with affiliates, enter into transactions that restrict dividends or distributions from subsidiaries, and merge, consolidate or sell, or otherwise dispose of, substantially all of their assets. Certain provisions of each of the credit agreements, indentures and supplemental indentures relating to the long-term debt restrict the ability of the Issuers or borrowers to loan funds or make payments to Parent. However, the Issuers or borrowers and Guarantor Subsidiaries are allowed to make certain permitted payments to Parent under the terms of the indentures, supplemental indentures and credit agreements.

Basis of Presentation

The following tables include summarized financial information of the obligor groups of debt issued by T-Mobile USA, Inc., Sprint, Sprint Communications, Inc., and Sprint Capital Corporation. The summarized financial information of each obligor group is presented on a combined basis with balances and transactions within the obligor group eliminated. Investments in and the equity in earnings of non-guarantor subsidiaries, which would otherwise be consolidated in accordance with U.S. GAAP, are excluded from the below summarized financial information pursuant to SEC Regulation S-X Rule 13-01.

The summarized balance sheet information for the consolidated obligor group of debt issued by T-Mobile USA, Inc. is presented in the table below:
(in millions) June 30, 2021 December 31, 2020
Current assets $ 19,176  $ 22,638 
Noncurrent assets 172,751  165,294 
Current liabilities 20,202  19,982 
Noncurrent liabilities 115,213  112,930 
Due to non-guarantors 7,730  7,433 
Due to related parties 4,830  4,873 
Due from related parties 18  22 

The summarized results of operations information for the consolidated obligor group of debt issued by T-Mobile USA, Inc. is presented in the table below:
Six Months Ended June 30, 2021
Year Ended December 31, 2020
(in millions)
Total revenues $ 39,018  $ 67,112 
Operating income 2,789  4,335 
Net income 673  1,148 
Revenue from non-guarantors 802  1,496 
Operating expenses to non-guarantors 1,324  2,127 
Other expense to non-guarantors (72) (114)

The summarized balance sheet information for the consolidated obligor group of debt issued by Sprint and Sprint Communications, Inc. is presented in the table below:
(in millions) June 30, 2021 December 31, 2020
Current assets $ 652  $ 2,646 
Noncurrent assets 30,151  26,278 
Current liabilities 6,949  4,209 
Noncurrent liabilities 66,762  65,161 
Due from non-guarantors 29,889  25,993 
Due to related parties 4,796  4,786 

The summarized results of operations information for the consolidated obligor group of debt issued by Sprint and Sprint Communications, Inc., since the acquisition of Sprint on April 1, 2020, is presented in the table below:
Six Months Ended June 30, 2021 Nine Months Ended December 31, 2020
(in millions)
Total revenues $ 1  $ 10 
Operating loss (2) (15)
Net loss (646) (2,229)
Revenue from non-guarantors 2  6 
Other income, net, from non-guarantors 1,045  1,084 

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The summarized balance sheet information for the consolidated obligor group of debt issued by Sprint Capital Corporation is presented in the table below:
(in millions) June 30, 2021 December 31, 2020
Current assets $ 652  $ 2,646 
Noncurrent assets 39,206  35,330 
Current liabilities 7,021  4,281 
Noncurrent liabilities 71,813  70,253 
Due from non-guarantors 38,944  35,046 
Due to related parties 4,796  4,786 

The summarized results of operations information for the consolidated obligor group of debt issued by Sprint Capital Corporation, since the acquisition of Sprint on April 1, 2020, is presented in the table below:
Six Months Ended June 30, 2021 Nine Months Ended December 31, 2020
(in millions)
Total revenues $ 1  $ 10 
Operating loss (2) (15)
Net loss (606) (2,165)
Revenue from non-guarantors 2  6 
Other income, net, from non-guarantors 1,231  1,085 

Affiliates Whose Securities Collateralize Securities Registered or Being Registered

For a description of the collateral arrangements relating to securities of affiliates that collateralize the Senior Secured Notes, please refer to the section entitled “Affiliates Whose Securities Collateralize the Notes and the Guarantees” in the Company’s Registration Statement on Form S-4/A filed with the SEC on April 21, 2021, which section is incorporated herein by reference.

The assets, liabilities and results of operations of the combined affiliates whose securities are pledged as Collateral are not materially different than the corresponding amounts presented in the condensed consolidated financial statements of the Company.

Performance Measures

In managing our business and assessing financial performance, we supplement the information provided by our financial statements with other operating or statistical data and non-GAAP financial measures. These operating and financial measures are utilized by our management to evaluate our operating performance and, in certain cases, our ability to meet liquidity requirements. Although companies in the wireless industry may not define each of these measures in precisely the same way, we believe that these measures facilitate comparisons with other companies in the wireless industry on key operating and financial measures.

The performance measures presented below include the impact of the Merger on a prospective basis from the close date of April 1, 2020. Historical results prior to April 1, 2020 have not been retroactively adjusted.

Customers

A customer is generally defined as a SIM number with a unique T-Mobile identifier which is associated with an account that generates revenue. Customers are qualified either for postpaid service utilizing phones, home internet, wearables, DIGITS or other connected devices, which include tablets and SyncUp products, where they generally pay after receiving service, or prepaid service, where they generally pay in advance of receiving service.

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The following table sets forth the number of ending customers:
As of June 30, Change
(in thousands) 2021 2020 # %
Customers, end of period
Postpaid phone customers (1)(2)
68,029  65,105  2,924  4  %
Postpaid other customers (1)(2)
15,819  12,648  3,171  25  %
Total postpaid customers 83,848  77,753  6,095  8  %
Prepaid customers (1)
20,941  20,574  367  2  %
Total customers 104,789  98,327  6,462  7  %
Acquired customers, net of base adjustments (2)
12  29,228  (29,216) NM
NM - Not Meaningful
(1)    Includes customers acquired in connection with the Merger and certain customer base adjustments. See Customer Base Adjustments and Net Customer Additions tables below.
(2)     In the first quarter of 2021, we acquired 11,000 postpaid phone customers and 1,000 postpaid other customers through our acquisition of an affiliate.

Total customers increased 6,462,000, or 7%, primarily from:

•Higher postpaid other customers, primarily due to growth in other connected devices, primarily related to public and educational sector customers and wearable products;
•Higher postpaid phone customers, primarily due to the success of new customer segments and rate plans and continued growth in existing and new markets, along with promotional activity and increased retail store traffic due to closures arising from the Pandemic in the prior period; and
•Higher prepaid customers, primarily due to the continued success of our prepaid business due to promotional activity and rate plan offers.

Customer Base Adjustments

Certain adjustments were made to align the customer reporting policies of T-Mobile and Sprint.

The adjustments made to the reported T-Mobile and Sprint ending customer base as of March 31, 2020, are presented below:
(in thousands) Postpaid phone customers Postpaid other customers Total postpaid customers Prepaid customers Total customers
Reconciliation to beginning customers
T-Mobile customers as reported, end of period March 31, 2020 40,797  7,014  47,811  20,732  68,543 
Sprint customers as reported, end of period March 31, 2020 25,916  8,428  34,344  8,256  42,600 
Total combined customers, end of period March 31, 2020 66,713  15,442  82,155  28,988  111,143 
Adjustments
Reseller reclassification to wholesale customers (1)
(199) (2,872) (3,071) —  (3,071)
EIP reclassification from postpaid to prepaid (2)
(963) —  (963) 963  — 
Divested prepaid customers (3)
—  —  —  (9,207) (9,207)
Rate plan threshold (4)
(182) (918) (1,100) —  (1,100)
Customers with non-phone devices (5)
(226) 226  —  —  — 
Collection policy alignment (6)
(150) (46) (196) —  (196)
Miscellaneous adjustments (7)
(141) (43) (184) (302) (486)
Total Adjustments (1,861) (3,653) (5,514) (8,546) (14,060)
Adjusted beginning customers as of April 1, 2020 64,852  11,789  76,641  20,442  97,083 
(1)     In connection with the closing of the Merger, we refined our definition of wholesale customers, resulting in the reclassification of certain postpaid and prepaid reseller customers to wholesale customers. Starting with the three months ended March 31, 2020, we discontinued reporting wholesale customers to focus on postpaid and prepaid customers and wholesale revenues, which we consider more relevant than the number of wholesale customers given the expansion of M2M and IoT products.
(2)     Prepaid customers with a device installment billing plan historically included as Sprint postpaid customers have been reclassified to prepaid customers to align with T-Mobile policy.
(3)     Customers associated with the Sprint wireless prepaid and Boost Mobile brands that were divested on July 1, 2020, have been excluded from our reported customers.
(4)     Customers who have rate plans with monthly recurring charges which are considered insignificant have been excluded from our reported customers.
(5)     Customers with postpaid phone rate plans without a phone (e.g., non-phone devices) have been reclassified from postpaid phone to postpaid other customers to align with T-Mobile policy.
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(6)     Certain Sprint customers subject to collection activity for an extended period of time have been excluded from our reported customers to align with T-Mobile policy.
(7)     Miscellaneous insignificant adjustments to align with T-Mobile policy.

Net Customer Additions

The following table sets forth the number of net customer additions:
Three Months Ended June 30, Change Six Months Ended
June 30, 		Change
(in thousands) 2021 2020 # % 2021 2020 # %
Net customer additions
Postpaid phone customers 627  253  374  148  % 1,400  705  695  99  %
Postpaid other customers 649  859  (210) (24) % 1,086  1,184  (98) (8) %
Total postpaid customers 1,276  1,112  164  15  % 2,486  1,889  597  32  %
Prepaid customers 76  133  (57) (43) % 227  5  222  NM
Total customers 1,352  1,245  107  9  % 2,713  1,894  819  43  %
Acquired customers, net of base adjustments —  29,228  (29,228) (100) % 12  29,228  (29,216) (100) %
NM - Not Meaningful

Total net customer additions increased 107,000, or 9%, for the three months ended and increased 819,000, or 43%, for the six months ended June 30, 2021.

The increase for the three months ended June 30, 2021, was primarily from:

•Higher postpaid phone net customer additions, primarily due to increased retail store traffic due to closures arising from the Pandemic in the prior period, as well as increased growth from T-Mobile for Business, partially offset by higher churn; partially offset by
•Lower postpaid other net customer additions, primarily due to elevated gross additions in the prior period related to the public and educational sector resulting from the Pandemic; and
•Lower prepaid net customer additions, primarily driven by higher migrations to postpaid plans, partially offset by lower churn.

The increase for the six months ended June 30, 2021, was primarily from:

•Higher postpaid phone net customer additions, primarily due to increased retail store traffic due to closures arising from the Pandemic in the prior period, partially offset by higher churn; and
•Higher prepaid net customer additions, primarily due to lower churn; partially offset by
•Lower postpaid other net customer additions, primarily due to higher disconnect volumes from an increased customer base.

Churn

Churn represents the number of customers whose service was disconnected as a percentage of the average number of customers during the specified period further divided by the number of months in the 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. We believe that churn provides management, investors and analysts with useful information to evaluate customer retention and loyalty.

The following table sets forth the churn:
Three Months Ended June 30, Change Six Months Ended June 30, Change
2021 2020 2021 2020
Postpaid phone churn 0.87  % 0.80  % 7 bps 0.92  % 0.82  % 10 bps
Prepaid churn 2.62  % 2.81  % -19 bps 2.70  % 3.17  % -47 bps

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Postpaid phone churn increased 7 basis points for the three months ended and increased 10 basis points for the six months ended June 30, 2021.

The increase for the three months ended June 30, 2021, was primarily from:

•More normal switching activity relative to the muted Pandemic-driven conditions a year ago; partially offset by
•Better customer payment performance.

The increase for the six months ended June 30, 2021, was primarily from:

•More normal switching activity relative to the muted Pandemic-driven conditions a year ago; and
•Higher churn from customers acquired in the Merger; partially offset by
•Better customer payment performance.

Prepaid churn decreased 19 basis points for the three months ended and decreased 47 basis points for the six months ended June 30, 2021.

The decrease for the three months ended June 30, 2021, was primarily from:

•Improved quality of recently acquired customers; and
•Continued network improvement.

The decrease for the six months ended June 30, 2021, was primarily from:

•The impact of stimulus programs and accelerated tax refund timing;
•Improved quality of recently acquired customers; and
•Promotional activity.

Total Postpaid Accounts

A postpaid account is generally defined as a billing account number that generates revenue. Postpaid accounts are generally comprised of customers that are qualified for postpaid service utilizing phones, home internet, wearables, DIGITS or other connected devices which include tablets and SyncUp products, where they generally pay after receiving service.
As of June 30, 2021 Change
(in thousands) 2021 2020 # %
Accounts, end of period
Total postpaid customer accounts(1)
26,363  25,486  877  3  %
(1)     Includes accounts acquired in connection with the Merger and certain account base adjustments. See Account Base Adjustments table below.

Total postpaid customer accounts increased 877,000, or 3%, primarily due to the success of new customer segments and rate plans, continued growth in existing and new markets, including our home internet product, along with promotional activity and increased retail store traffic due to closures arising from the Pandemic in the prior period.

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Account Base Adjustments

Certain adjustments were made to align the account reporting policies of T-Mobile and Sprint.

The adjustments made to the reported T-Mobile and Sprint ending account base as of March 31, 2020 are presented below:
(in thousands) Postpaid Accounts
Reconciliation to beginning accounts
T-Mobile accounts as reported, end of period March 31, 2020 15,244 
Sprint accounts, end of period March 31, 2020 11,246 
Total combined accounts, end of period March 31, 2020 26,490 
Adjustments
Reseller reclassification to wholesale accounts (1)
(1)
EIP reclassification from postpaid to prepaid (2)
(963)
Rate plan threshold (3)
(18)
Collection policy alignment (4)
(76)
Miscellaneous adjustments (5)
(47)
Total Adjustments (1,105)
Adjusted beginning accounts as of April 1, 2020 25,385 
(1)     In connection with the closing of the Merger, we refined our definition of wholesale accounts resulting in the reclassification of certain postpaid and prepaid reseller accounts to wholesale accounts.
(2)     Prepaid accounts with a customer with a device installment billing plan historically included as Sprint postpaid accounts have been reclassified to prepaid accounts to align with T-Mobile policy.
(3)     Accounts with customers who have rate plans with monthly recurring charges which are considered insignificant have been excluded from our reported accounts.
(4)     Certain Sprint accounts subject to collection activity for an extended period of time have been excluded from our reported accounts to align with T-Mobile policy.
(5)     Miscellaneous insignificant adjustments to align with T-Mobile policy.


Average Revenue Per User

ARPU represents the average monthly service revenue earned from customers. We believe ARPU provides management, investors and analysts with useful information to assess and evaluate our service revenue per customer and assist in forecasting our future service revenues generated from our customer base. Postpaid phone ARPU excludes postpaid other customers and related revenues, which include home internet, wearables, DIGITS and other connected devices such as tablets and SyncUp products.

The following table illustrates the calculation of our operating measure ARPU and reconciles this measure to the related service revenues:
(in millions, except average number of customers and ARPU) Three Months Ended June 30, Change Six Months Ended
June 30, 		Change
2021 2020 $ % 2021 2020 $ %
Calculation of Postpaid Phone ARPU
Postpaid service revenues $ 10,492  $ 9,959  $ 533  5  % $ 20,795  $ 15,846  $ 4,949  31  %
Less: Postpaid other revenues (825) (618) (207) 33  % (1,645) (928) (717) 77  %
Postpaid phone service revenues 9,667  9,341  326  3  % 19,150  14,918  4,232  28  %
Divided by: Average number of postpaid phone customers (in thousands) and number of months in period 67,680  64,889  2,791  4  % 67,257  52,737  14,520  28  %
Postpaid phone ARPU $ 47.61  $ 47.99  $ (0.38) (1) % $ 47.45  $ 47.15  $ 0.30  1  %
Calculation of Prepaid ARPU
Prepaid service revenues $ 2,427  $ 2,311  $ 116  5  % $ 4,778  $ 4,684  $ 94  2  %
Divided by: Average number of prepaid customers (in thousands) and number of months in period 20,994  20,380  614  3  % 20,861  20,570  291  1  %
Prepaid ARPU $ 38.53  $ 37.80  $ 0.73  2  % $ 38.17  $ 37.95  $ 0.22  1  %

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Postpaid Phone ARPU

Postpaid phone ARPU decreased $0.38, or 1%, for the three months ended and increased $0.30, or 1%, for the six months ended June 30, 2021.

The decrease for the three months ended June 30, 2021, was primarily from:

•Promotional activity, including an increase in customers per account; and
•The impact of Sprint rate plan migrations; partially offset by
•Higher premium services, including Magenta MAX.

The increase for the six months ended June 30, 2021, was primarily from:

•The net impact of customers acquired in the Merger, which have higher ARPU (net of changes arising from the reduction in base due to policy adjustments and reclassification of certain ARPU components from the acquired customers being moved to other revenue lines); and
•Higher premium services, including Magenta MAX; partially offset by
•Promotional activity, including an increase in customers per account.

Prepaid ARPU

Prepaid ARPU increased $0.73, or 2%, for the three months ended and increased $0.22, or 1%, for the six months ended June 30, 2021.

The increase for the three months ended June 30, 2021, was primarily from:

•Higher revenues due to improved rate plan mix; and
•Higher premium services; partially offset by
•A reduction in certain non-recurring charges.

The increase for the six months ended June 30, 2021, was primarily from:

•The impacts of certain adjustments to our customer base in April 2020; and
•Higher premium services; partially offset by
•A reduction in certain non-recurring charges.

Average Revenue Per Account

Average Revenue per Account (“ARPA”) represents the average monthly postpaid service revenue earned per account. We believe postpaid ARPA provides management, investors and analysts with useful information to assess and evaluate our postpaid service revenue realization and assist in forecasting our future postpaid service revenues on a per account basis. We consider postpaid ARPA to be indicative of our revenue growth potential given the increase in the average number of postpaid phone customers per account and increases in postpaid other customers, including home internet, wearables, DIGITS or other connected devices, which include tablets and SyncUp products.

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The following table illustrates the calculation of our operating measure ARPA and reconciles this measure to the related service revenues:
(in millions, except average number of accounts, ARPA) Three Months Ended June 30, Change Six Months Ended
June 30, 		Change
2021 2020 $ % 2021 2020 $ %
Calculation of Postpaid ARPA
Postpaid service revenues $ 10,492  $ 9,959  $ 533  5  % $ 20,795  $ 15,846  $ 4,949  31  %
Divided by: Average number of postpaid accounts (in thousands) and number of months in period 26,188  25,424  764  3  % 26,014  20,289  5,725  28  %
Postpaid ARPA $ 133.55  $ 130.57  $ 2.98  2  % $ 133.23  $ 130.16  $ 3.07  2  %

Postpaid ARPA

Postpaid ARPA increased $2.98, or 2%, for the three months ended and increased $3.07, or 2%, for the six months ended June 30, 2021, primarily due to:

•An increase in customers per account; and
•Higher premium services, including Magenta MAX; partially offset by
•Promotional activity.

Adjusted EBITDA and Core Adjusted EBITDA

Beginning in the first quarter of 2021, we began disclosing Core Adjusted EBITDA as a financial measure to improve comparability as we de-emphasize device leasing programs as part of our value proposition.

Adjusted EBITDA represents earnings before Interest expense, net of Interest income, Income tax expense, Depreciation and amortization, stock-based compensation and certain income and expenses not reflective of our ongoing operating performance. Core Adjusted EBITDA represents Adjusted EBITDA less device lease revenues. Adjusted EBITDA margin represents Adjusted EBITDA divided by Service revenues. Core Adjusted EBITDA margin represents Core Adjusted EBITDA divided by Service revenues.

Adjusted EBITDA, Adjusted EBITDA margin, Core Adjusted EBITDA and Core Adjusted EBITDA margin are non-GAAP financial measures utilized by our management to monitor the financial performance of our operations. We use Adjusted EBITDA internally as a measure to evaluate and compensate our personnel and management for their performance. We use Adjusted EBITDA and Core Adjusted EBITDA as benchmarks to evaluate our operating performance in comparison to our competitors. Management believes analysts and investors use Adjusted EBITDA and Core Adjusted EBITDA as supplemental measures to evaluate overall operating performance and facilitate comparisons with other wireless communications services companies because they are indicative of our ongoing operating performance and trends by excluding the impact of interest expense from financing, non-cash depreciation and amortization from capital investments, stock-based compensation, Merger-related costs including network decommissioning costs and incremental costs directly attributable to the Pandemic, as they are not indicative of our ongoing operating performance, as well as certain other nonrecurring income and expenses. Management believes analysts and investors use Core Adjusted EBITDA because it normalizes for the transition in the Company’s device financing strategy, by excluding the impact of device lease revenues from Adjusted EBITDA, to align with the exclusion of the related depreciation expense on leased devices from Adjusted EBITDA. Adjusted EBITDA, Adjusted EBITDA margin, Core Adjusted EBITDA and Core Adjusted EBITDA margin have limitations as analytical tools and should not be considered in isolation or as substitutes 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 Core Adjusted EBITDA and reconciles Adjusted EBITDA and Core Adjusted EBITDA to Net income, which we consider to be the most directly comparable GAAP financial measure:
Three Months Ended June 30, Change Six Months Ended
June 30, 		Change
(in millions) 2021 2020 $ % 2021 2020 $ %
Net income $ 978  $ 110  $ 868  789  % $ 1,911  $ 1,061  $ 850  80  %
Adjustments:
Income from discontinued operations, net of tax —  (320) 320  (100) % —  (320) 320  (100) %
Income from continuing operations 978  (210) 1,188  (566) % 1,911  741  1,170  158  %
Interest expense 820  776  44  6  % 1,612  961  651  68  %
Interest expense to affiliates 32  63  (31) (49) % 78  162  (84) (52) %
Interest income (2) (6) 4  (67) % (5) (18) 13  (72) %
Other expense, net 1  195  (194) (99) % 126  205  (79) (39) %
Income tax expense 277  2  275  NM 523  308  215  70  %
Operating income 2,106  820  1,286  157  % 4,245  2,359  1,886  80  %
Depreciation and amortization 4,077  4,064  13  —  % 8,366  5,782  2,584  45  %
Operating income from discontinued operations (1)
—  432  (432) (100) % —  432  (432) (100) %
Stock-based compensation (1)
129  139  (10) (7) % 259  262  (3) (1) %
Merger-related costs 611  798  (187) (23) % 909  941  (32) (3) %
COVID-19-related costs —  341  (341) (100) % —  458  (458) (100) %
Impairment expense —  418  (418) (100) % —  418  (418) (100) %
Other, net (2)
(17) 5  (22) (440) % 32  30  2  7  %
Adjusted EBITDA 6,906  7,017  (111) (2) % 13,811  10,682  3,129  29  %
Lease revenues (914) (1,421) 507  (36) % (1,955) (1,586) (369) 23  %
Core Adjusted EBITDA
$ 5,992  $ 5,596  $ 396  7  % $ 11,856  $ 9,096  $ 2,760  30  %
Net income margin (Net income divided by Service revenues) 7  % 1  % 600 bps 7  % 5  % 200 bps
Adjusted EBITDA margin (Adjusted EBITDA divided by Service revenues) 48  % 53  % -500 bps 48  % 48  % — bps
Core Adjusted EBITDA margin (Core Adjusted EBITDA divided by Service revenues)
41  % 42  % -100 bps 41  % 41  % — bps
NM - Not Meaningful
(1)Stock-based compensation includes payroll tax impacts and may not agree with stock-based compensation expense in the condensed consolidated financial statements. Additionally, certain stock-based compensation expenses associated with the Transactions have been included in Merger-related costs.
(2)Other, net may not agree with the Condensed Consolidated Statements of Comprehensive Income 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 from Adjusted EBITDA and Core Adjusted EBITDA.

Core Adjusted EBITDA increased $396 million, or 7%, for the three months ended and increased $2.8 billion, or 30%, for the six months ended June 30, 2021. The components comprising Core Adjusted EBITDA are discussed further above.

The increase for the three months ended June 30, 2021 was primarily due to:

•Higher Equipment revenues, excluding Lease revenues;
•Higher Total service revenues; and
•Lower Selling, general and administrative expenses, excluding Merger-related costs and supplemental employee payroll, third-party commissions and cleaning-related COVID-19 costs; partially offset by
•Higher Cost of equipment sales, excluding Merger-related costs; and
•Higher Cost of services, excluding Merger-related costs.

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The increase for the six months ended June 30, 2021, was primarily due to:

•Higher Total service revenues; and
•Higher Equipment revenues, excluding Lease revenues; partially offset by
•Higher Cost of equipment sales, excluding Merger-related costs;
•Higher Cost of services expenses, excluding Merger-related costs; and
•Higher Selling, general and administrative expenses, excluding Merger-related costs and supplemental employee payroll, third-party commissions and cleaning-related COVID-19 costs.

Adjusted EBITDA decreased $111 million, or 2%, for the three months ended and increased $3.1 billion, or 29%, for the six months ended June 30, 2021. The changes were primarily due to the fluctuations in Core Adjusted EBITDA, discussed above, including changes in Lease revenues. Lease revenues decreased $507 million for the three months ended and increased $369 million for the six months ended June 30, 2021.

Liquidity and Capital Resources

Our principal sources of liquidity are our cash and cash equivalents and cash generated from operations, proceeds from issuance of long-term debt and common stock, financing leases, the sale of certain receivables, financing arrangements of vendor payables which effectively extend payment terms and the Revolving Credit Facility (as defined below). Further, the incurrence of additional indebtedness may inhibit our ability to incur new debt under the terms governing our existing and future indebtedness, which may make it more difficult for us to incur new debt in the future to finance our business strategy.

Cash Flows

The following is a condensed schedule of our cash flows for the three and six months ended June 30, 2021 and 2020:
Three Months Ended June 30, Change Six Months Ended
June 30, 		Change
(in millions) 2021 2020 $ % 2021 2020 $ %
Net cash provided by operating activities $ 3,779  $ 777  $ 3,002  386  % $ 7,440  $ 2,394  $ 5,046  211  %
Net cash used in investing activities (2,083) (6,356) 4,273  (67) % (13,322) (7,936) (5,386) 68  %
Net cash (used in) provided by financing activities (577) 15,628  (16,205) NM 3,297  15,175  (11,878) (78) %
NM - Not meaningful

Operating Activities

Net cash provided by operating activities increased $3.0 billion, or 386%, for the three months ended and increased $5.0 billion, or 211%, for the six months ended June 30, 2021.

The increase for the three months ended June 30, 2021, was primarily from:

•A $2.9 billion decrease in net cash outflows from changes in working capital, primarily due to the one-time impact of $2.3 billion in gross payments for the settlement of interest rate swaps related to Merger financing for the three months ended June 30, 2020, included in the use of cash from Other current and long-term liabilities, as well as lower use of cash from Accounts payable and accrued liabilities and Inventories, partially offset by higher use of cash from Accounts receivable and Equipment installment plan receivables.
•Net cash provided by operating activities includes $190 million and $370 million in payments for Merger-related costs for the three months ended June 30, 2021 and 2020, respectively.

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The increase for the six months ended June 30, 2021, was primarily from:

•A $2.6 billion increase in Net income, adjusted for non-cash income and expense; and
•A $2.5 billion decrease in net cash outflows from changes in working capital, primarily due to the one-time impact of $2.3 billion in gross payments for the settlement of interest rate swaps related to Merger financing for the six months ended June 30, 2020, included in the use of cash from Other current and long-term liabilities, as well as lower use of cash from Inventories and Accounts payable and accrued liabilities, partially offset by higher use of cash from Equipment installment plan receivables and Accounts receivable.
•Net cash provided by operating activities includes $467 million and $531 million in payments for Merger-related costs for the six months ended June 30, 2021 and 2020, respectively.

Investing Activities

Net cash used in investing activities decreased $4.3 billion, or 67%, for the three months ended and increased $5.4 billion, or 68%, for the six months ended June 30, 2021.

The use of cash for the three months ended June 30, 2021, was primarily from:

•$3.3 billion in Purchases of property and equipment, including capitalized interest, from network integration related to the Merger and the continued build-out of our nationwide 5G network; partially offset by
•$1.1 billion in Proceeds related to beneficial interests in securitization transactions.

The use of cash for the six months ended June 30, 2021, was primarily from:

•$8.9 billion in Purchases of spectrum licenses and other intangible assets, including deposits, primarily due to $8.9 billion paid for spectrum licenses won at the conclusion of Auction 107 in March 2021; and
•$6.5 billion in Purchases of property and equipment, including capitalized interest, from network integration related to the Merger and the continued build-out of our nationwide 5G network; partially offset by
•$2.0 billion in Proceeds related to beneficial interests in securitization transactions.

Financing Activities

Net cash (used in) provided by financing activities decreased $16.2 billion for the three months ended and decreased $11.9 billion for the six months ended June 30, 2021.

The use of cash for the three months ended June 30, 2021, was primarily from:

•$3.2 billion in Repayments of long-term debt driven by the redemption of $1.3 billion aggregate principal amount of our 6.000% Senior Notes due 2023, $1.0 billion aggregate principal amount of our 6.000% Senior Notes due 2024 and $500 million aggregate principal amount of our 5.125% Senior Notes due 2025, and repayments of $219 million aggregate principal amount of our 3.360% Senior Secured Series 2016-1 A-1 Notes due 2021 and $131 million aggregate principal amount of our 4.738% Senior Secured Series 2018-1 A-1 Notes due 2025; and
•$269 million in Repayments of financing lease obligations; partially offset by
•$3.0 billion in Proceeds from issuance of long-term debt, net of issuance costs.

The source of cash for the six months ended June 30, 2021, was primarily from:

•$9.8 billion in Proceeds from issuance of long-term debt, net of issuance costs; partially offset by
•$5.4 billion in Repayments of long-term debt driven by the redemption of $2.0 billion aggregate principal amount of our 6.500% Senior Notes due 2026, $1.3 billion aggregate principal amount of our 6.000% Senior Notes due 2023, $1.0 billion aggregate principal amount of our 6.000% Senior Notes due 2024 and $500 million aggregate principal amount of our 5.125% Senior Notes due 2025, and repayments of $438 million aggregate principal amount of our 3.360% Senior Secured Series 2016-1 A-1 Notes due 2021 and $131 million aggregate principal amount of our 4.738% Senior Secured Series 2018-1 A-1 Notes due 2025;
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•$556 million in Repayments of financing lease obligations; and
•$294 million in Tax withholdings on share-based awards.

Cash and Cash Equivalents

As of June 30, 2021, our Cash and cash equivalents were $7.8 billion compared to $10.4 billion at December 31, 2020.

Free Cash Flow

Free Cash Flow represents Net cash provided by operating activities less cash payments for Purchases of property and equipment, including Proceeds from sales of tower sites and Proceeds related to beneficial interests in securitization transactions, less Cash payments for debt prepayment or debt extinguishment. Free Cash Flow and Free Cash Flow, excluding gross payments for the settlement of interest rate swaps, are non-GAAP financial measures utilized by our management, investors and analysts of our financial information to evaluate cash available to pay debt and provide further investment in the business.

In 2021, we sold tower sites for proceeds of $31 million, which are included in Proceeds from sales of tower sites within Net
cash used in investing activities in our Condensed Consolidated Statements of Cash Flows. As these proceeds were from the sale of fixed assets and are used by management to assess cash available for capital expenditures during the year, we determined the proceeds are relevant for the calculation of Free Cash Flow and included them in the table below. Other proceeds from the sale of fixed assets for the periods presented are not significant. We have presented the impact of the sales in the table below, which reconciles Free Cash Flow and Free Cash Flow, excluding gross payments for the settlement of interest rate swaps, to Net cash provided by operating activities, which we consider to be the most directly comparable GAAP financial measure.
Three Months Ended June 30, Change Six Months Ended
June 30, 		Change
(in millions) 2021 2020 $ % 2021 2020 $ %
Net cash provided by operating activities $ 3,779  $ 777  $ 3,002  386  % $ 7,440  $ 2,394  $ 5,046  211  %
Cash purchases of property and equipment (3,270) (2,257) (1,013) 45  % (6,453) (4,010) (2,443) 61  %
Proceeds from sales of tower sites 31  —  31  NM 31  —  31  NM
Proceeds related to beneficial interests in securitization transactions 1,137  602  535  89  % 2,028  1,470  558  38  %
Cash payments for debt prepayment or debt extinguishment costs (6) (24) 18  (75) % (71) (24) (47) 196  %
Free Cash Flow 1,671  (902) 2,573  (285) % 2,975  (170) 3,145  NM
Gross cash paid for the settlement of interest rate swaps —  2,343  (2,343) (100) % —  2,343  (2,343) (100) %
Free Cash Flow, excluding gross payments for the settlement of interest rate swaps $ 1,671  $ 1,441  $ 230  16  % $ 2,975  $ 2,173  $ 802  37  %
NM - Not Meaningful

Free Cash Flow, excluding gross payments for the settlement of interest rate swaps, increased $230 million, or 16%, for the three months ended and increased $802 million, or 37%, for the six months ended June 30, 2021.

The increase for the three months ended June 30, 2021, was impacted by the following:

•Higher Net cash provided by operating activities, as described above; and
•Higher Proceeds related to beneficial interests in securitization transactions; partially offset by
•Higher Cash purchases of property and equipment, including capitalized interest of $57 million and $119 million for the three months ended June 30, 2021 and 2020, respectively, from network integration related to the Merger and the continued build-out of our nationwide 5G network.
•Free Cash Flow includes $190 million and $370 million in payments for Merger-related costs for the three months ended June 30, 2021 and 2020, respectively.
•The calculation of Free Cash Flow, excluding gross payments for the settlement of interest rate swaps, excludes the one-time impact of gross payments for the settlement of interest rate swaps related to Merger financing of $2.3 billion for the three months ended June 30, 2020.
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The increase for the six months ended June 30, 2021, was impacted by the following:

•Higher Net cash provided by operating activities, as described above; and
•Higher Proceeds related to beneficial interests in securitization transactions; partially offset by
•Higher Cash purchases of property and equipment, including capitalized interest of $141 million and $231 million for the six months ended June 30, 2021 and 2020, respectively, from network integration related to the Merger and the continued build-out of our nationwide 5G network.
•Free Cash Flow includes $467 million and $531 million in payments for Merger-related costs for the six months ended June 30, 2021 and 2020, respectively.
•The calculation of Free Cash Flow, excluding gross payments for the settlement of interest rate swaps, excludes the one-time impact of gross payments for the settlement of interest rate swaps related to Merger financing of $2.3 billion for the six months ended June 30, 2020.

Borrowing Capacity

We maintain a financing arrangement with Deutsche Bank AG, which allows for up to $108 million in borrowings. Under the financing arrangement, we can effectively extend payment terms for invoices payable to certain vendors. As of June 30, 2021, there were no outstanding balances under such financing arrangement.

We also maintain vendor financing arrangements primarily with our main network equipment suppliers. Under the respective agreements, we can obtain extended financing terms. During the three and six months ended June 30, 2021, we repaid $36 million and $91 million, respectively, associated with the vendor financing arrangements and other financial liabilities. These payments are included in Repayments of short-term debt for purchases of inventory, property and equipment and other financial liabilities, in our Condensed Consolidated Statements of Cash Flows. As of June 30, 2021 and December 31, 2020, the outstanding balance under the vendor financing arrangements and other financial liabilities was $148 million and $240 million, respectively, of which $77 million and $122 million, respectively, was assumed in connection with the closing of the Merger. As of June 30, 2021, the outstanding borrowings was $77 million under the vendor financing agreements.

We maintain a revolving credit facility (the “Revolving Credit Facility”) with an aggregate commitment amount of $5.5 billion. As of June 30, 2021, there was no outstanding balance under the Revolving Credit Facility.

On October 30, 2020, we entered into a $5.0 billion senior secured term loan commitment with certain financial institutions. On January 14, 2021, we issued an aggregate of $3.0 billion of senior notes. The senior secured term loan commitment was reduced by an amount equal to the aggregate gross proceeds of the Senior Notes, which reduced the commitment to $2.0 billion. On March 23, 2021, we issued an aggregate of $3.8 billion of Senior Notes. The senior secured term loan commitment was terminated upon the issuance of the $3.8 billion of Senior Notes.

Debt Financing

As of June 30, 2021, our total debt and financing lease liabilities were $77.7 billion, excluding our tower obligations, of which $68.4 billion was classified as long-term debt and $1.4 billion was classified as long-term financing lease liabilities.

During the six months ended June 30, 2021, we issued long-term debt for net proceeds of $9.8 billion and redeemed and repaid short- and long-term debt with an aggregate principal amount of $5.5 billion.

For more information regarding our debt financing transactions, see Note 7 - Debt of the Notes to the Condensed Consolidated Financial Statements.

Spectrum Auction

In March 2021, the FCC announced that we were the winning bidder of 142 licenses in Auction 107 (C-band spectrum) for an aggregate purchase price of $9.3 billion, excluding relocation costs. At the inception of Auction 107 in October 2020, we deposited $438 million. Upon conclusion of Auction 107 in March 2021, we paid the FCC the remaining $8.9 billion for the licenses won in the auction. We expect to incur an additional $1.2 billion in relocation costs which will be paid through 2024.

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For more information regarding our spectrum licenses, see Note 5 - Goodwill, Spectrum License Transactions and Other Intangible Assets of the Notes to the Condensed Consolidated Financial Statements.

Off-Balance Sheet Arrangements

We have arrangements, as amended from time to time, to sell certain EIP accounts receivable and service accounts receivable on a revolving basis as a source of liquidity. As of June 30, 2021, we derecognized net receivables of $2.5 billion upon sale through these arrangements. 

For more information regarding these off-balance sheet arrangements, see Note 4 – Sales of Certain Receivables of the Notes to the Condensed Consolidated Financial Statements.

Future Sources and Uses of Liquidity

We may seek additional sources of liquidity, including through the issuance of additional long-term debt in 2021, to continue to opportunistically acquire spectrum licenses or other assets in private party transactions or for the refinancing of existing long-term debt on an opportunistic basis. Excluding liquidity that could be needed for spectrum acquisitions, or for other assets, we expect our principal sources of funding to be sufficient to meet our anticipated liquidity needs for business operations for the next 12 months as well as our longer-term liquidity needs. Our intended use of any such funds is for general corporate purposes, including for capital expenditures, spectrum purchases, opportunistic investments and acquisitions, redemption of high yield callable debt, tower obligations, potential shareholder returns and the execution of our integration plan.

We determine future liquidity requirements, for both operations and capital expenditures, based in large part upon projected financial and operating performance, and opportunities to acquire additional spectrum. We regularly review and update these projections for changes in current and projected financial and operating results, general economic conditions, the competitive landscape and other factors. We have incurred, and will incur, substantial expenses to comply with the Government Commitments, and we are also expected to incur substantial restructuring expenses in connection with integrating and coordinating T-Mobile’s and Sprint’s businesses, operations, policies and procedures. While we have assumed that a certain level of Merger-related expenses will be incurred, factors beyond our control, including required consultation and negotiation with certain counterparties, could affect the total amount or the timing of these expenses. These expenses could exceed the costs historically borne by us and adversely affect our financial condition and results of operations. There are a number of additional risks and uncertainties, including those due to the impact of the Pandemic, that could cause our financial and operating results and capital requirements to differ materially from our projections, which could cause future liquidity to differ materially from our assessment.

The indentures, supplemental indentures and credit agreements governing our long-term debt to affiliates and third parties, excluding financing leases, contain covenants that, among other things, limit the ability of the Issuers or borrowers and the Guarantor Subsidiaries to incur more debt, pay dividends and make distributions on our common stock, make certain investments, repurchase stock, create liens or other encumbrances, enter into transactions with affiliates, enter into transactions that restrict dividends or distributions from subsidiaries, and merge, consolidate or sell, or otherwise dispose of, substantially all of their assets. Certain provisions of each of the credit agreements, indentures and supplemental indentures relating to the long-term debt to affiliates and third parties restrict the ability of the Issuers or borrowers to loan funds or make payments to Parent. However, the Issuers or borrowers are allowed to make certain permitted payments to Parent under the terms of each of the credit agreements, indentures and supplemental indentures relating to the long-term debt to affiliates and third parties. We were in compliance with all restrictive debt covenants as of June 30, 2021.

Shentel Wireless Assets Acquisition

Subsequent to June 30, 2021, on July 1, 2021, we closed on the acquisition of the Wireless Assets (as defined in Note 2 - Business Combinations of the Notes to the Condensed Consolidated Financial Statements) for a cash purchase price of approximately $1.9 billion. For more information regarding the acquisition of the Wireless Assets, see Note 2 – Business Combinations of the Notes to the Condensed Consolidated Financial Statements.

Financing Lease Facilities

We have entered into uncommitted financing lease facilities with certain partners that provide us with the ability to enter into financing leases for network equipment and services. As of June 30, 2021, we have committed to $5.6 billion of financing leases under these financing lease facilities, of which $362 million and $470 million was executed during the three and six
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months ended June 30, 2021, respectively. We expect to enter into up to an additional $730 million in financing lease commitments during the year ending December 31, 2021.

Capital Expenditures

Our liquidity requirements have been driven primarily by capital expenditures for spectrum licenses, the construction, expansion and upgrading of our network infrastructure and the integration of the networks, spectrum, technology, personnel, customer base and business practices of T-Mobile and Sprint. Property and equipment capital expenditures primarily relate to the integration of our spectrum licenses, including the pending acquisition of C-band licenses won in Auction 107, acquired Sprint 2.5 GHz spectrum licenses and existing 600 MHz spectrum licenses as we build out our nationwide 5G network. We expect the majority of our remaining capital expenditures related to these efforts to occur in 2021 and 2022, after which we expect a reduction in capital expenditure requirements.

For more information regarding our spectrum licenses, see Note 5 - Goodwill, Spectrum License Transactions and Other Intangible Assets of the Notes to the Condensed Consolidated Financial Statements.

Dividends

We have never paid or declared any cash dividends on our common stock, and we do not intend to declare or pay any cash dividends on our common stock in the foreseeable future. Our credit facilities and the indentures and supplemental indentures governing our long-term debt to affiliates and third parties, excluding financing leases, contain covenants that, among other things, restrict our ability to declare or pay dividends on our common stock.

Related Party Transactions

We have related party transactions associated with DT, SoftBank or their affiliates in the ordinary course of business, including intercompany servicing and licensing.

Disclosure of Iranian Activities under Section 13(r) of the Securities Exchange Act of 1934

Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012 added Section 13(r) to the Exchange Act of 1934, as amended (“Exchange Act”). Section 13(r) requires an issuer to disclose in its annual or quarterly reports, as applicable, whether it or any of its affiliates knowingly engaged in certain activities, transactions or dealings relating to Iran or with designated natural persons or entities involved in terrorism or the proliferation of weapons of mass destruction. Disclosure is required even where the activities, transactions or dealings are conducted outside the U.S. by non-U.S. affiliates in compliance with applicable law, and whether or not the activities are sanctionable under U.S. law.

As of the date of this report, we are not aware of any activity, transaction or dealing by us or any of our affiliates for the three months ended June 30, 2021, that requires disclosure in this report under Section 13(r) of the Exchange Act, except as set forth below with respect to affiliates that we do not control and that are our affiliates solely due to their common control with either DT or SoftBank. We have relied upon DT and SoftBank for information regarding their respective activities, transactions and dealings.

DT, through certain of its non-U.S. subsidiaries, is party to roaming and interconnect agreements with the following mobile and fixed line telecommunication providers in Iran, some of which are or may be government-controlled entities: Irancell Telecommunications Services Company, Telecommunication Kish Company, Mobile Telecommunication Company of Iran, and Telecommunication Infrastructure Company of Iran. In addition, during the three months ended June 30, 2021, DT, through certain of its non-U.S. subsidiaries, provided basic telecommunications services to two customers in Germany identified on the Specially Designated Nationals and Blocked Persons List maintained by the U.S. Department of Treasury’s Office of Foreign Assets Control: Bank Melli and Europäisch-Iranische Handelsbank. These services have been terminated or are in the process of being terminated. For the three months ended June 30, 2021, gross revenues of all DT affiliates generated by roaming and interconnection traffic and telecommunications services with the Iranian parties identified herein were less than $0.1 million, and the estimated net profits were less than $0.1 million.

In addition, DT, through certain of its non-U.S. subsidiaries that operate a fixed-line network in their respective European home countries (in particular Germany), provides telecommunications services in the ordinary course of business to the Embassy of Iran in those European countries. Gross revenues and net profits recorded from these activities for the three months ended June 30, 2021 were less than $0.1 million. We understand that DT intends to continue these activities.

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Separately, SoftBank, through one of its non-U.S. subsidiaries, provides roaming services in Iran through Irancell Telecommunications Services Company. During the three months ended June 30, 2021, SoftBank had no gross revenues from such services and no net profit was generated. We understand that the SoftBank subsidiary intends to continue such services. This subsidiary also provides telecommunications services in the ordinary course of business to accounts affiliated with the Embassy of Iran in Japan. During the three months ended June 30, 2021, SoftBank estimates that gross revenues and net profit generated by such services were both under $0.1 million. We understand that the SoftBank subsidiary is obligated under contract and intends to continue such services.

In addition, SoftBank, through one of its non-U.S. indirect subsidiaries, provides office supplies to the Embassy of Iran in Japan. SoftBank estimates that gross revenue and net profit generated by such services during the three months ended June 30, 2021, were both under $0.1 million. We understand that the SoftBank subsidiary intends to continue such activities.

Critical Accounting Policies and Estimates

Preparation of our condensed consolidated financial statements in accordance with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of certain assets, liabilities, revenues and expenses, as well as related disclosure of contingent assets and liabilities. There have been no material changes to the critical accounting policies and estimates as previously disclosed in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2020, and which are hereby incorporated by reference herein.

Accounting Pronouncements Not Yet Adopted

For information regarding recently issued accounting standards, see Note 1 – Summary of Significant Accounting Policies of the Notes to the Condensed Consolidated Financial Statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes to the interest rate risk as previously disclosed in Part II, Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2020.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures designed to ensure information required to be disclosed in our periodic reports filed or submitted under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Our disclosure controls include the use of a Disclosure Committee which is comprised of representatives from our Accounting, Legal, Treasury, Technology, Risk Management, Government Affairs and Investor Relations functions and are designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective, as of the end of the period covered by this Form 10-Q.

The certifications required by Section 302 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) are filed as exhibits 31.1 and 31.2, respectively, to this Form 10-Q.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act, during our most recently completed fiscal quarter that materially affected or are reasonably likely to materially affect our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

For more information regarding the legal proceedings in which we are involved, see Note 2 - Business Combinations and Note 11 – Commitments and Contingencies of the Notes to the Condensed Consolidated Financial Statements.

Item 1A. Risk Factors

Other than the updated risk factors below, there have been no material changes in our risk factors as previously disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2020.

Our Fifth Amended and Restated Certificate of Incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain actions and proceedings, which could limit the ability of our stockholders to obtain a judicial forum of their choice for disputes with the Company or its directors, officers or employees.

Our Fifth Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”) provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Company, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or employee of the Company to the Company or its stockholders, (iii) any action asserting a claim arising pursuant to any provision of the General Corporation Law of the State of Delaware, the Certificate of Incorporation or the Company's bylaws or (iv) any other action asserting a claim arising under, in connection with, and governed by the internal affairs doctrine. This choice of forum provision does not waive our compliance with our obligations under the federal securities laws and the rules and regulations thereunder. Moreover, the provision does not apply to suits brought to enforce a duty or liability created by the Exchange Act or by the Securities Act of 1933, as amended.

This choice of forum provision may increase costs to bring a claim, discourage claims or limit a stockholder's ability to bring a claim in a judicial forum that the stockholder finds favorable for disputes with the Company or its directors, officers or employees, which may discourage such lawsuits against the Company and its directors, officers and employees, even though an action, if successful, might benefit our stockholders. Alternatively, if a court were to find the choice of forum provision to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such matters in other jurisdictions, which could increase our costs of litigation and adversely affect our business and financial condition.

Our business and Sprint’s business may not be integrated successfully or such integration may be more difficult, time consuming or costly than expected. Operating costs, customer loss and business disruptions, including challenges in maintaining relationships with employees, customers, suppliers or vendors, may be greater than expected.

The combination of two independent businesses is complex, costly and time-consuming, and may divert significant management attention and resources. This process may disrupt our business or otherwise impact our ability to compete. The overall combination of our and Sprint’s businesses may also result in material unanticipated problems, expenses, liabilities, competitive responses and impacts, and loss of customers and other business relationships. The difficulties of combining the operations of the companies include, among others:

•diversion of management attention to integration matters;
•difficulties in integrating operations and systems, including intellectual property and communications systems, administrative and information technology infrastructure, and supplier and vendor arrangements;
•challenges in conforming standards, controls, procedures and accounting and other policies;
•alignment of key performance measurements may result in a greater need to communicate and manage clear expectations while we work to integrate and align policies and practices;
•difficulties in integrating employees;
•the transition of management to the combined company management team, and the need to address possible differences in corporate cultures, management philosophies, and compensation structures;
•challenges in retaining existing customers and obtaining new customers;
•difficulties in managing the expanded operations of a significantly larger and more complex company;
•any disruptions to the operations and business in the Shentel service area following the Company’s acquisition of Wireless Assets (as defined in Note 2 - Business Combinations of the Notes to the Condensed Consolidated Financial Statements) as a result of the transition of such assets to the Company;
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•compliance with Government Commitments relating to national security;
•known or potential unknown liabilities of Sprint that are larger than expected;
•other potential adverse consequences and unforeseen increased expenses or liabilities associated with the Transactions.

Additionally, uncertainties over the integration process could cause customers, suppliers, distributors, dealers, retailers and others to seek to change or cancel our existing business relationships or to refuse to renew existing relationships. Suppliers, distributors and content and application providers may also delay or cease developing new products for us that are necessary for the operations of our business due to uncertainties. Competitors may also target our existing customers by highlighting potential uncertainties and integration difficulties.

Some of these factors are outside our control, and any one of them could result in lower revenues, higher costs and diversion of management time and energy, which could adversely impact our business, financial condition and operating results. In addition, even if the integration is successful, the full benefits of the Transactions including, among others, the synergies, cost savings or sales or growth opportunities may not be realized within the anticipated time frames or at all.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

None.

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Item 6. Exhibits
Incorporated by Reference
Exhibit No. Exhibit Description Form Date of First Filing Exhibit Number Filed Herein
2.1 8-K 6/1/2021 2.1
2.2 X
4.1 8-K 5/13/2021 4.5
4.2 S-4 3/30/2021 4.19
4.3 X
10.1* X
10.2* X
10.3 X
10.4 X
22.1 X
31.1 X
31.2 X
32.1** X
32.2** X
101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH XBRL Taxonomy Extension Schema Document. X
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document. X
101.DEF XBRL Taxonomy Extension Definition Linkbase Document. X
101.LAB XBRL Taxonomy Extension Label Linkbase Document. X
101.PRE XBRL Taxonomy Extension Presentation Linkbase. X
104 Cover Page Interactive Data File (the cover page XBRL tags)
* Indicates a management contract or compensatory plan or arrangement.
** Furnished herein.
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SIGNATURES

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 thereunto duly authorized.

T-MOBILE US, INC.
August 3, 2021 /s/ Peter Osvaldik
Peter Osvaldik
Executive Vice President and Chief Financial Officer
(Principal Financial Officer and Authorized Signatory)

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EXHIBIT 2.2
AMENDMENT NO. 1
TO
ASSET PURCHASE AGREEMENT

This Amendment No. 1 to the Asset Purchase Agreement (this “Amendment”), effective as of July 1, 2021, is entered into by and between T-Mobile USA, Inc., a Delaware corporation (“Buyer”), and Shenandoah Telecommunications Company, a Virginia corporation (“Seller”). Each of Buyer and Seller is referred to herein as a “Party”, and collectively as the “Parties”.
WHEREAS, reference is hereby made to that certain Asset Purchase Agreement, dated as of May 28, 2021, by and between Buyer and Seller (as the same may be amended from time to time, the “Agreement”); capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement; and
WHEREAS, pursuant to and in accordance with Section 12.7 of the Agreement, the parties desire to amend a certain provision of the Agreement as hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants in this Amendment, the parties, intending to be legally bound, hereby agree as follows:
1.Amendment to Section 8.2(a)(vi). Section 8.2(a)(vi) of the Agreement is hereby deleted in its entirety and replaced with the following:
“[Reserved]”
2.Amendment to Section 8.2(b)(iv). Section 8.2(b)(iv) of the Agreement is hereby deleted in its entirety and replaced with the following:
“[Reserved]”
3.Amendment to Article 5. Article 5 of the Agreement is hereby amended to add to the end thereof the following new Section 5.20:
“5.20    Tower Lease Agreements. Within sixty (60) days following the Closing Date, Buyer shall deliver, or cause to be delivered, to Seller Exhibit B to be attached to the Pay and Walk Agreement and General Release, a form of which is attached to this Agreement as Exhibit C-2, listing up to one hundred twenty-one (121) sites thereon. Within three (3) Business Days following such delivery of Exhibit B to the Pay and Walk Agreement and General Release, each Party shall deliver, or cause to be delivered a counterpart of the Pay and Walk Agreement and General Release, in the form attached to this Agreement as Exhibit C-2 (and with the Exhibit B delivered by Buyer attached thereto), duly executed by such Party (or an Affiliate thereof). The date upon which the Pay and Walk Agreement and General Release is mutually executed shall be referred to herein as the “Pay and Walk Agreement Effective Date”. On the first day of the calendar month following the Pay and Walk Agreement Effective Date, Seller shall grant a credit to Buyer with respect to the base rent payable by Buyer or its Affiliates pursuant to the site license agreements with Shenandoah Mobile, LLC that constitute Transferred Assets (the

|US-DOCS\124713438.11||

“Specified License Agreements”) in the amount of the product of (x) $230.00 multiplied by (y) the number of Keep Sites (defined below), then multiplied by (z) the number of calendar months elapsed between the Closing and the first day of the calendar month following the Pay and Walk Agreement Effective Date. With respect to each site that is listed on Exhibit A to the Pay and Walk Agreement and General Release and not also listed on Exhibit B thereto (as delivered by Buyer in accordance with this Section 5.20) (each site, a “Keep Site” and together, the “Keep Sites”), within a reasonable time following Buyer’s written request each Party shall deliver, or cause to be delivered, a counterpart of a First Amendment to Site License Agreement, in the form attached to this Agreement as Exhibit C-1 with any modifications thereto mutually agreed between the Parties, duly executed by such Party (or an Affiliate thereof). On the first day of the calendar month following the Pay and Walk Agreement Effective Date and on the first day of each calendar month thereafter until the expiration of the term of the Pay and Walk Agreement and General Release, Seller shall grant a credit to Buyer with respect to the base rent payable by Buyer or its Affiliates pursuant to the Specified License Agreements in the amount of the product of (x) the total number of Keep Sites less the number of Specified License Agreements that have been amended in accordance with the terms of the First Amendment to Site License Agreement (provided that such amount shall not be less than zero) multiplied by (y) $230.00. Notwithstanding anything set forth herein or in the Transaction Documents, neither Buyer nor its Affiliates may pursuant to the terms of the Pay and Walk Agreement and General Release terminate a Specified License Agreement (x) with respect to a Keep Site or (y) that has been amended in accordance with the terms of the First Amendment to Site License Agreement; provided that nothing in the forgoing sentence shall be deemed to modify the rights of Buyer to terminate any Specified License Agreement (if applicable, as amended by the First Amendment to the Site License Agreement and as may be amended from time to time) pursuant to the terms and conditions therein.”
4.Amendment to Exhibit C-1. The Exhibit C-1 attached hereto shall be deemed to be Exhibit C-1 of the Agreement.
5.Reference to and Effect on the Agreement.
(a)On and after the date of this Amendment, each reference in the Agreement to “this Agreement”, “hereunder”, “hereof”, “herein”, or words of like import referring to such Agreement, shall mean and be a reference to the Agreement as amended by this Amendment.
(b)Except as specifically amended by this Amendment, the Agreement shall remain in full force and effect and is hereby ratified and confirmed in all respects.
(c)The execution, delivery and performance of this Amendment shall not, except as expressly provided herein, constitute a waiver of any provision of, or operate as a waiver of any right, power or remedy of any party pursuant to the Agreement.
6.Miscellaneous. All interpretative provisions of the Agreement, including Section 1.2 (Principles of Interpretation), and Article 12 (Miscellaneous) are hereby incorporated by reference, mutatis mutandis.
2

[Signature pages follow]
3

IN WITNESS WHEREOF the parties hereto have caused this Amendment to be duly executed as of and on the date first above written.

T-MOBILE USA, INC.


By:____/s/ Dirk Mosa________________________
Name:    Dirk Mosa
Title:    SVP, Corporate Development and Roaming




[Signature Page to Amendment No. 1 to Asset Purchase Agreement]

SHENANDOAH TELECOMMUNICATIONS COMPANY


By:__/s/ Christopher E. French_________________
Name:    Christopher E. French
Title:    President and Chief Executive Officer



[Signature Page to Amendment No. 1 to Asset Purchase Agreement]

EXHIBIT C-1
Form of First Amendment to Site License Agreement
See attached.
[Signature Page to Amendment No. 1 to Asset Purchase Agreement]

FIRST AMENDMENT TO SITE LICENSE AGREEMENT
THIS FIRST AMENDMENT TO SITE LICENSE AGREEMENT (“First Amendment”) is made effective as of the date of last signature (the “Amendment Effective Date”) by Shenandoah Mobile, LLC, a Virginia limited liability company (“LANDLORD”), and T-Mobile Northeast LLC (successor in interest to Shenandoah Personal Communications, LLC) (“TENANT”).

WITNESSETH:
WHEREAS, LANDLORD and TENANT or TENANT’s predecessor entered into a SITE LICENSE AGREEMENT (“Agreement”) dated ____________ pursuant to which LANDLORD leased to TENANT the Licensed Premises located at _____________________________________.

WHEREAS, it is the desire of the parties to amend the Agreement and memorialize the Agreement in writing, subject to further amendment and modification as may be agreed by the parties pursuant to the Pay and Walk Agreement and General Release, by and between LANDLORD and TENANT.

NOW, THEREFORE, in consideration of the foregoing and the mutual promises and covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, LANDLORD and TENANT agree as follows:

1.Definitions.

All capitalized terms not specifically defined herein shall have the meanings ascribed to them in the Agreement.

2. Amendments to Agreement. The Agreement is hereby amended as follows:

a. Monthly Rent, Escalation, and Taxes: Section 3(A) of the Agreement is hereby deleted and replaced with the following:

(A) As of the first day of the month following the Amendment Effective Date, TENANT will receive a credit of $230.00 per month against the Base Rent then in effect under the Agreement. Upon the first day of the month following the date that TENANT provides LANDLORD with a building permit, or written documentation from the applicable jurisdiction that no permit is required, for the Modification (as defined below) to retrofit the Licensed Premises to TENANT’s Standard Configuration (as defined below), the Base Rent shall be reduced from the current amount to $2,800.00 plus any additional cost of equipment located at additional RAD centers or Ground Space in accordance with the pricing defined herein, and the $230.00 credit per month against the Base Rent shall cease. If TENANT fails to remove any equipment that exceeds the Standard Configuration that TENANT agreed to remove as part of its Modification to retrofit the Licensed Premises to the Standard Configuration within 6 months after the building permit approval date, the Base Rent will be adjusted retroactively to account for any excess equipment in accordance with the pricing defined herein until such time that the excess equipment is removed. Upon TENANT’s removal of any equipment located at additional RAD centers or on additional
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Ground Space as part of a subsequent Modification, TENANT shall provide LANDLORD thirty (30) days written notice during which time LANDLORD will inspect the Licensed Premises and confirm such removal. Beginning on the first of the month following the expiration of the thirty (30) day inspection period, the Base Rent shall be reduced by the additional cost related to such additional equipment. Should TENANT fail to remove such equipment, the Base Rent and any additional rent will continue in accordance with the Agreement and without reduction or setoff until such removal is completed as reasonably required. For the avoidance of doubt, the credit of $230.00 per month against the Base Rent shall only apply prior to the first Modification, and shall not apply to subsequent Modifications. The Monthly Rent itemized breakdown is shown in new Exhibit “F” “Total Monthly Rent” as attached and incorporated herein. [In addition, and if applicable, TENANT shall be responsible for the payment of Revenue Share Reimbursement as defined in Subsection (B) hereof. Collectively, the Base Rent and Revenue Share Reimbursement shall be defined as the “Monthly Rent”, which is to be paid on the first day of each month, in advance without setoff or deduction to:

Shenandoah Mobile, LLC
ATTN: Mail Cashier
P. O. Box 459
Edinburg, Virginia 22824

or to such other person, firm, or place as LANDLORD may from time to time designate in writing at least thirty (30) days in advance of any Monthly Rent payment date. If applicable, the Revenue Share Reimbursement will also be listed in a separate column in Exhibit “F”. All payments shall reference LANDLORD’s site identification on the remittance. In the event multiple payments are made on one remittance, site identification and the rent paid therefore shall be individually itemized on the voucher portion of the remittance. ]1

b. Monthly Rent, Escalation, and Taxes: Section 3 (C) of the Agreement is hereby deleted and replaced with the following:

(C) Base Rent shall increase on each anniversary of the Amendment Effective Date by three percent (3%) over the Base Rent payable during the prior 12-month period.

c. Termination: The following is hereby added as new Section 4(F):

(F) By TENANT, at any time after the expiration of the first Renewal Term, for any reason, by providing at least one hundred eighty (180) days’ prior written notice to LANDLORD.

d. Use: Section 5 of the Agreement is hereby deleted and replaced with the following:

5. Use: The Licensed Premises may be used by TENANT and TENANT will have access to the Licensed Premises for (a) the construction, alteration, maintenance, repair, replacement, upgrade, removal and relocation of the Approved Equipment, installation of back-up power sources, including fixed or mobile generators or fuel cells and above ground propane fuel storage tanks and improvements and activities related thereto and (b) the transmission and
1     This language may be stricken for SLA’s without Revenue Share.
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reception of wireless signals and other activities in connection with the provision of wireless communications services utilizing any technology protocols and frequencies for which TENANT has been granted one or more licenses or is otherwise authorized to use by the Federal Communications Commission (“FCC”) or any frequencies TENANT leases, licenses, acquires or otherwise has the right to use. Notwithstanding anything to the contrary herein, TENANT shall not operate at variance from the specifications in its FCC license or the FCC’s rules governing TENANT’s operation of its Approved Equipment. Notwithstanding anything to the contrary in this First Amendment or the Agreement, TENANT may use the radio frequency signal generated by the Approved Equipment to provide industry standard roaming, machine-to-machine and MVNO services. The structural analysis and integrity of the Tower is based on the equipment listed within the Exhibits portion of this Agreement and does not include any equipment listed on previous exhibits or identified on an Exhibit as “reserved”.

e. Installation, Operation, and Maintenance. Section 6(A) of the Agreement is hereby deleted and replaced with the following:

(A) Improvements:

    (i) General: TENANT, at TENANT's sole expense, shall be responsible for any and all improvements to the Licensed Premises to accommodate its use. All such improvements (except for the Approved Equipment) shall become the property of LANDLORD unless LANDLORD provides written notice to TENANT requesting that TENANT remove such improvements. No materials may be used in the installation of the antennas or transmission lines that will cause corrosion, rust, or deterioration of the Tower or its appurtenances. All attachments to the Tower shall be by means of detachable connections, clamps, and straps. No drilling, hole punching, or welding shall be permitted. TENANT agrees to attach to LANDLORD’s grounding system at TENANT’s cost and expense. TENANT shall secure and pay for all permits, fees and licenses necessary for TENANT's work or operation of its Approved Equipment. All work and installations for the use of the Licensed Premises shall be performed by TENANT in coordination with LANDLORD.

    (ii) Modifications to Approved Equipment: During the Term, TENANT shall have the right to replace, repair, augment, add or otherwise modify its utilities, cables, conduits, fiber, Approved Equipment or any portion thereof (“Modification”) subject to the following procedures:

        (a)        Minor Modification. A “Minor Modification” is defined as any Modification that (i) does not increase the aggregate weight or aggregate surface area of the Approved Equipment documented in the Agreement, and (ii) does not increase the size of the ground space portion of the Premises. TENANT shall have the right to perform any Minor Modifications at any time and without LANDLORD’s consent or approval, but with prior notice to LANDLORD detailing the replacement equipment quantities and model numbers. All Access procedures in accordance with Section 6D herein must be followed.

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        (b)        Major Modification. A “Major Modification” is defined as a modification that does not meet the definition of a Minor Modification. TENANT shall proceed as follows for any Major Modification:

            (i) TENANT must apply to make a Major Modification by submitting an application form to LANDLORD. TENANT shall pay for the costs associated with a structural analysis and mount analysis but shall not be required to pay any application fees to LANDLORD for the review and approval of the application or any other documents TENANT may be required to submit. A post installation inspection fee not to exceed $2,500.00 is to be charged and subject to change due to market conditions. LANDLORD shall coordinate a mount analysis with the company of its choice provided the rates charged are consistent with market rates and such company has delivery timelines acceptable to TENANT and require TENANT to pay LANDLORD for the cost thereof. LANDLORD shall coordinate a structural analysis with the company of its choice provided the rates charged are consistent with market rates and such company has delivery timelines acceptable to TENANT and require TENANT to pay LANDLORD for the cost thereof to ensure that the addition of the Approved Equipment and other property of TENANT will not compromise the integrity of the Tower or its usefulness to LANDLORD. Should it be determined that such integrity would be compromised beyond existing safety standards, TENANT will have the right to modify its proposal, or pay to have the Tower structurally reinforced. Should TENANT require an expansion of the Equipment Area, such expansion will be subject to the terms, conditions, procedures and potential rent increases herein. The expansion area will be determined by dimensions of proposed added equipment as well as any additional usable and marketable encumbered space (i.e. spark area) that renders ground space not useable or marketable (additional encumbered space over the current encumbered space provided such additional space would have been usable or marketable should TENANT not have a need for it) . All improvement made by the TENANT to the Licensed Premises shall be in accordance with the construction requirements set forth on Exhibit “E”, which are incorporated herein by reference. All Access procedures in accordance with revised Section 6D herein must be followed.

            (ii)  Within ten (10) business days of receiving an application, for a Major Modification from TENANT, LANDLORD shall notify TENANT as to whether it has approved the Major Modification application as-is or requires changes to the Major Modification application and whether the proposed Major Modification will result in an increase to the Monthly Rental.  It is understood by the parties that an increase to the Base Rent can be charged only for a Major Modification that exceeds either (A) the aggregate surface area of the greater of (y) the Approved Equipment documented in the Agreement, or (z) the Standard Configuration; or (B) the ground space or rooftop cabinet space dimensions of the greater of (y) the ground space documented in the Agreement, or (z) the Standard Configuration. Once the Major Modification is approved, and once a passing structural analysis and any required third-party approvals are received, the parties shall execute an amendment to the Agreement.

f. Installation, Operation, and Maintenance: Section 6(D) Access of the Agreement is hereby deleted and replaced with the following:

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(D) Access: TENANT, TENANT's employees, agents and subcontractors shall have the non-exclusive right of ingress and egress on, in, over, under and through the Site, seven (7) days a week, twenty-four (24) hours a day, on foot or motor vehicle, including trucks, to access the Site, subject to any restrictions in the Prime Lease, for the purpose of installing, maintaining, operating, modifying, upgrading, removing or enhancing the Approved Equipment. TENANT’s authorized personnel or agents shall utilize LANDLORD’s “Log In” system (https://pcssmc.shentel.com) before entering and exiting the Licensed Premises for any purpose. TENANT shall only use the access easement designated by LANDLORD to reach the Licensed Premises and shall use only tower crews approved by LANDLORD. TENANT shall submit to LANDLORD a list of tower crews that will be used by TENANT along with their insurance certificates and contractor licenses and shall be pre-approved by LANDLORD prior to any work being done on the Tower, and such approval shall be provided within five (5) business days after such materials are submitted by TENANT.

LANDLORD shall be responsible, at Landlord’s sole cost and expense, for the maintenance and repair of the access road from the nearest public roadway to the Site in a manner sufficient to allow pedestrian and vehicular access at all times unless damage to the access road is caused by TENANT. LANDLORD shall have no duty to remove snow; provided, however, in the event that TENANT requires access to the Licensed Premises but snow on the access road prevents or otherwise hinders TENANT’s access to the Licensed Premises for more than eight (8) hours, then TENANT shall notify LANDLORD and LANDLORD and TENANT shall cooperate with one another for either the removal of such snow or otherwise allow TENANT access to the Licensed Premises on terms mutually agreeable to the parties. and the costs of any such snow removal or alternative access will be shared equally by LANDLORD and TENANT. If TENANT damages existing conditions of the access road during TENANT’s construction, maintenance, or visits, it is TENANT’s responsibility at its sole cost and expense to repair and must be done so in a timely manner. If TENANT does not repair damage to access road, LANDLORD reserves the right to repair and charge TENANT accordingly.   If access to the Site is granted through a separate access easement or other agreement (other than a Prime Lease) ("Easement"), LANDLORD shall provide a copy of such Easement to TENANT and shall ensure that any consent required to permit TENANT to have rights consistent with the Easement are secured. 

g. Installation, Operation, and Maintenance. Section 6(E) Reservation of Right to Inspect of the Agreement is hereby deleted and replaced with the following:

(E) Reservation of Right to Inspect: LANDLORD reserves the right to inspect the Licensed Premises (but not any equipment within shelters or cabinets) periodically to ensure it is structurally in compliance will all rules and regulations set forth herein, including all mandated safety requirements. Any such inspections by LANDLORD are subject to reasonable notice to the TENANT and the TENANT’s right to provide an escort to LANDLORD for any such inspections, except that the foregoing requirements of notice and escort shall not be applicable to any part of the Licensed Premises that is freely accessible to LANDLORD without any assistance or action by the TENANT. The making of periodic inspections or the failure to do so will operate neither to impose on LANDLORD any liability of any kind whatsoever nor to relieve TENANT of any responsibility, obligations, or liability assumed under this Agreement. In the event an inspection reveals that TENANT’s Approved Equipment, or unapproved equipment or its installation thereof, creates a safety hazard at the Site, LANDLORD shall provide written notice to the TENANT describing the safety deficiency and the repairs required. In the event that TENANT fails to make the specified safety repairs or respond to LANDLORD within thirty (30)
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days of receipt of such notice, LANDLORD may proceed to make all required repairs. Upon completion thereof, LANDLORD shall invoice TENANT for all such safety repairs and payment will be due within forty-five (45) days of receipt. Should TENANT make such safety repairs, TENANT shall provide certification and documentation indicating that such repairs have been completed.

h. Installation, Operation, and Maintenance: The following is hereby added as new Section 6(F):

(F) Standard Configuration: As to TENANT’s initial and subsequent installation of its Approved Equipment, and subject to availability and Tower structural capacity, LANDLORD shall at each Licensed Premises provide TENANT Tower Space and an Equipment Area to allow for and support the greater of TENANT’s existing Tower Space and Equipment Area entitlements as of the Amendment Effective Date, or TENANT’s “Standard Configuration”, which is defined as and shall consist of:
(i)Any combination of Tower-mounted antennas and related electronic equipment, which may differ in type, quantity, weight and dimensions, but excluding mounts, provided that, (y) such equipment may not have a combined surface area that exceeds twenty thousand (20,000) square inches when determined by multiplying the two largest dimensions (length, width or depth) of such equipment, and (z) such equipment must be entirely contained within a ten foot (10’) vertical space or “envelope” on the subject Tower;
(ii)An area for cables of any type, including, without limitation, coaxial, conduit and hybrid cables, with an aggregate outside line diameter of up to twenty-two (22) square inches of aggregate diameter cable space;
(iii)The Equipment Area space equals a minimum of two hundred forty (240) contiguous square feet, within space leased or controlled by LANDLORD at the time TENANT submits an application provided that the Prime Lease allows for it; and
(iv)Microwave antennas and related equipment (“MW Equipment”) will be deemed to be included within the Standard Configuration provided that they fit within the ten foot (10’) vertical envelope described above, within the same RAD center.
(v)If a second RAD center on the Tower is necessary for the placement of MW Equipment or a second antenna array, and if space is available for such use, TENANT shall have the right to use the second RAD center and the Monthly Rent will increase in accordance with the following table.
        
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Item
Associated increase to Monthly Rent
Extra square inch beyond Standard Configuration at Primary antenna array or Secondary antenna array
$0.11
Line diameter over Standard Configuration - 0.25" incremental
$15
Microwave addition outside of the Standard Configuration vertical space or “envelope” together with any applicable microwave ODUs and lines
$100/ ft. in Microwave Diameter
Secondary antenna array outside of the Standard Configuration vertical space or “envelope” (includes same entitlement rights as the Standard Configuration except for rights to additional ground space)
$1,650
Additional ground space beyond the Standard Configuration
$3.00/ SF

i. Insurance. Section 11(E) TENANT”S Responsibility the following language is added at the end of Section 11(E) of the Agreement:

“Notwithstanding anything to the contrary in the Agreement, TENANT shall only be required to include LANDLORD and Shenandoah Telecommunications Company as additional insureds on the policies specified in Sections 11(C), (D) and (E) of the Agreement.”

j. Default. The following is hereby added as new Section 12(A):

(A) LANDLORD Default. Any one or more of the following events shall constitute a “LANDLORD Default”:
(i) The failure to perform any of its obligations under this Agreement and such failure continues for thirty (30) days from the date TENANT gives written notice thereof to LANDLORD (unless another time period is specified for a particular default under this Agreement ); provided, however, that in the event that more than thirty (30) days are required in order to cure any non-monetary LANDLORD Default, LANDLORD shall have a reasonable period of time to cure such a default if LANDLORD shall have commenced and is diligently pursuing corrective action within such initial thirty (30) days; or
(ii) The prosecution of any case, proceeding or other action under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency or relief of indebtedness with respect to LANDLORD.
(iii) In the event of a LANDLORD Default, TENANT shall have all remedies available at law or in equity including without limitation damages and injunctive relief, including without limitation:
(1)In addition to such remedies or any remedies available under this Agreement, TENANT may terminate the Agreement. If Monthly Rental has commenced,
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TENANT shall (subject to any right of set-off) pay LANDLORD any Monthly Rental or fees due for the period up to the termination of the Agreement but shall not owe Monthly Rental for any subsequent period, provided however, that TENANT has removed the Approved Equipment. Any advance payments made for periods after the termination of the Agreement will be reimbursed to TENANT.
(2)In the event LANDLORD fails to cure a default under a Prime Lease within the time frame provided under the Prime Lease, in addition to any other rights or remedies, TENANT may cure such default. Notwithstanding any other provision in this Agreement, TENANT may then set off against Base Rent next coming due under the Agreement all reasonable costs of curing such default.
(3)In addition to any other rights and remedies that TENANT may have, if LANDLORD in violation of this Agreement fails to make any repairs to the Property within the time frame required by any governmental authority, or after thirty (30) days’ written notice by TENANT, then TENANT may reasonably make the repairs at LANDLORD’s sole cost. LANDLORD shall pay the costs thereof to TENANT upon receipt of an invoice and reasonably sufficient documentation of such costs. If LANDLORD does not make payment to TENANT within ten (10) business days after such demand, TENANT shall have the right to deduct the costs of the repairs from the succeeding Base Rent amounts under the Agreement. TENANT’s right to repair the Property is granted solely to protect TENANT’s interests and property. TENANT shall have no duty to undertake repairs. The undertaking of repairs will not create a duty to protect the interests of LANDLORD or to third parties.
k. Assignment. Notwithstanding anything to the contrary in the Agreement, TENANT may assign or otherwise transfer the Agreement without LANDLORD’s consent to DISH Networks or any of TENANT’s affiliates, provided assignee assumes all the terms, conditions and obligations of the Agreement as if assignee were TENANT and TENANT provides LANDLORD written notice of any such assignment within sixty (60) days after its effective date.

l. TENANT’s Notice Addresses. TENANT’s notice addresses in Section 16 of the Agreement shall be deleted and replaced with the following addresses:

TENANT:        T-Mobile
            c/o T-Mobile USA, Inc.
            12920 SE 38th Street
            Bellevue, WA 98006
            Attn: Lease Management

With a copy to:        T-Mobile
            c/o T-Mobile USA, Inc.
            12920 SE 38th Street
            Bellevue, WA 98006
            Attn: Legal (Network)

m. LANDLORD Cooperation. The following is hereby added as new Section 31.

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31. LANDLORD Cooperation: Whenever LANDLORD’s approval or consent is required under the Agreement, such approval or consent shall not be unreasonably withheld, conditioned or delayed. At TENANT’s sole cost and expense, LANDLORD shall reasonably cooperate with TENANT’s efforts to obtain any necessary utility services and Governmental Approvals required for TENANT’s use of any Licensed Premises.

3. Miscellaneous.

(a)Headings. The headings preceding the text of the sections and subsections hereof are inserted solely for convenience of reference and shall not constitute a part of this First Amendment, nor shall they affect its meaning, construction or effect.
(b)Counterpart Execution. This First Amendment and any subsequent amendments to the Agreement, may be executed by original, facsimile or electronic signatures (complying with the U.S. Federal ESIGN Act of 2000, 15 U.S.C. 96) and in any number of counterparts which shall be considered one instrument. Counterparts, signed facsimile and electronic counterparts shall legally bind the parties to the same extent as original documents.
(c)Integration; Amendments. Except as specifically set forth herein, this First Amendment shall in no way modify, alter or amend the remaining terms and conditions of the Agreement, all of which are ratified by the parties and shall remain in full force and effect. To the extent there is a conflict between the terms and conditions of the Agreement and this First Amendment, the terms and conditions of this First Amendment will govern and control. This First Amendment may not be changed orally but only by an instrument in writing, duly executed by or on behalf of the party against whom enforcement of any waiver, change, modification, consent or discharge is sought. For the avoidance of doubt, notwithstanding anything to the contrary stated herein, it is the desire of the parties to amend the Agreement and memorialize the Agreement in writing, subject to further amendment and modification as may be agreed by the parties pursuant to the Pay and Walk Agreement and General Release, by and between LANDLORD and TENANT.

SIGNATURES APPEAR NEXT PAGE

Page 9 of 11

IN WITNESS WHEREOF, the parties have set their hands as of the dates written below.


LANDLORD:

SHENANDOAH MOBILE, LLC


By:                         
Name:                     
Title:                         
Date:                         



TENANT:

T-Mobile Northeast LLC


By:                         
Name:                     
Title:                         
Date:                         





















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EXHIBIT “F”
TOTAL MONTHLY RENT

Page 11 of 11
EXHIBIT 4.3
FORTY-NINTH SUPPLEMENTAL INDENTURE
FORTY-NINTH SUPPLEMENTAL INDENTURE (this “Forty-Ninth Supplemental Indenture”), dated as of March 30, 2021, among T-Mobile USA, Inc. (the “Company”), the entities listed on Schedule I hereto (the “New Guarantors”), the existing guarantors signatory hereto (the “Existing Guarantors”) and Deutsche Bank Trust Company Americas, as trustee under the Indenture referred to below (the “Trustee”).
WITNESSETH:
WHEREAS, the Company has heretofore executed and delivered to the Trustee an Indenture, dated as of April 28, 2013 (the “Base Indenture”) as amended and supplemented with respect to the Company’s (a) 6.000% Senior Notes due 2023 pursuant to the Seventeenth Supplemental Indenture dated as of September 5, 2014, (b) 6.000% Senior Notes due 2024 pursuant to the Twenty-First Supplemental Indenture dated as of November 5, 2015, (c) 4.000% Senior Notes due 2022 pursuant to the Twenty-Third Supplemental Indenture dated as of March 16, 2017, (d) 5.125% Senior Notes due 2025 pursuant to the Twenty-Fourth Supplemental Indenture dated as of March 16, 2017, (e) 5.375% Senior Notes due 2027 pursuant to the Twenty-Fifth Supplemental Indenture dated as of March 16, 2017, (f) 4.000% Senior Notes due 2022 pursuant to the Twenty-Sixth Supplemental Indenture dated as of April 27, 2017, (g) 5.375% Senior Notes due 2027-1 pursuant to the Twenty-Eighth Supplemental Indenture dated as of April 28, 2017, (h) 4.500% Senior Notes due 2026 pursuant to the Thirty-Second Supplemental Indenture dated as of January 25, 2018, (i) 4.750% Senior Notes due 2028 pursuant to the Thirty-Third Supplemental Indenture dated as of January 25, 2018, (j) 4.500% Senior Notes due 2026-1 pursuant to the Thirty-Fifth Supplemental Indenture dated as of April 30, 2018, (k) 4.750% Senior Notes due 2028-1 pursuant to the Thirty-Sixth Supplemental Indenture dated as of April 30, 2018, (l) 2.250% Senior Notes due 2026 pursuant to the Forty-Third Supplemental Indenture dated as of January 14, 2021, (m) 2.625% Senior Notes due 2029 pursuant to the Forty-Fourth Supplemental Indenture dated as of January 14, 2021, (n) 2.875% Senior Notes due 2031 pursuant to the Forty-Fifth Supplemental Indenture dated as of January 14, 2021, (o) 2.625% Senior Notes due 2026 pursuant to the Forty-Sixth Supplemental Indenture dated as of March 23, 2021, (p) 3.375% Senior Notes due 2029 pursuant to the Forty-Seventh Supplemental Indenture dated as of March 23, 2021 and (q) 3.500% Senior Notes due 2031 pursuant to the Forty-Eighth Supplemental Indenture dated as of March 23, 2021, and as amended and supplemented by the Eleventh Supplemental Indenture dated as of May 1, 2013, the Sixteenth Supplemental Indenture dated as of August 11, 2014, the Nineteenth Supplemental Indenture dated as of September 28, 2015, the Thirtieth Supplemental Indenture dated as of May 9, 2017, the Thirty-Fourth Supplemental Indenture dated as of April 26, 2018, the Thirty-Seventh Supplemental Indenture dated as of May 20, 2018, the Thirty-Eighth Supplemental Indenture dated as of December 20, 2018, the Fortieth Supplemental Indenture, dated as of September 27, 2019, the Forty-First Supplemental Indenture, dated as of April 1, 2020 and the Forty-Second Supplemental Indenture, dated as of May 7, 2020 (the Base Indenture as so amended and supplemented, the “Indenture”);
WHEREAS, Section 4.17 of the Indenture provides that under certain circumstances the Company is required to cause the New Guarantors to execute and deliver to the Trustee a supplemental indenture pursuant to which the New Guarantors shall become Guarantors of the applicable Notes on the terms and conditions set forth herein; and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee, the Company, the Existing Guarantors and the New Guarantors are authorized to execute and deliver this Forty-Ninth Supplemental Indenture.


NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Company, the New Guarantors, the Existing Guarantors and the Trustee mutually covenant and agree for the benefit of the Holders of the applicable Notes as follows:
1.    Defined Terms. As used in this Forty-Ninth Supplemental Indenture, capitalized terms used but not defined herein shall have the meaning set forth in the Indenture. The words “herein,” “hereof” and “hereby” and other words of similar import used in this Forty-Ninth Supplemental Indenture refer to this Forty-Ninth Supplemental Indenture as a whole and not to any particular section hereof.
2.    Agreement to Guarantee. The New Guarantors hereby agree to unconditionally guarantee, and the Existing Guarantors hereby affirm their unconditional guarantee of, the Company’s obligations under the Notes and the Indenture on the terms and subject to the conditions set forth in the Indenture including but not limited to ARTICLE X thereof.
3.    Notices. All notices or other communications to the Company and the New Guarantors shall be given as provided in Section 12.02 of the Indenture.
4.    Ratification of Indenture; Supplemental Indentures Part of Indenture. Except as expressly contemplated hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect.
5.    Governing Law. THIS FORTY-NINTH SUPPLEMENTAL INDENTURE WILL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
6    The Trustee. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Forty-Ninth Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the New Guarantors and the Company.
7.    Counterpart Originals. This Forty-Ninth Supplemental Indenture may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed will be deemed to be an original and all of which taken together will constitute one and the same agreement. The exchange of copies of this Forty-Ninth Supplemental Indenture and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Forty-Ninth Supplemental Indenture as to the parties hereto and may be used in lieu of the original Forty-Ninth Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or PDF transmission shall be deemed to be their original signatures for all purposes. The parties may sign any number of copies of this Forty-Ninth Supplemental Indenture. Each signed copy will be an original, but all of them together represent the same agreement.
8.    Headings, etc. The headings of the Articles and Sections of this Forty-Ninth Supplemental Indenture have been inserted for convenience of reference only, are not to be considered a part of this Forty-Ninth Supplemental Indenture and will in no way modify or restrict any of the terms or provisions hereof.
[Signatures on following page]


IN WITNESS WHEREOF, the parties hereto have caused this Forty-Ninth Supplemental Indenture to be duly executed, all as of the date first above written.
T-MOBILE USA, INC.
By:    /s/ Johannes Thorsteinsson    
Name: Johannes Thorsteinsson
Title: Senior Vice President, Treasury &
Treasurer
T-MOBILE US, INC.
By:    /s/ Johannes Thorsteinsson    
Name: Johannes Thorsteinsson
Title: Senior Vice President, Treasury &
Treasurer

[Forty-Ninth Supplemental Indenture]

ALDA WIRELESS HOLDINGS, LLC
AMERICAN TELECASTING DEVELOPMENT, LLC
AMERICAN TELECASTING OF ANCHORAGE, LLC
AMERICAN TELECASTING OF COLUMBUS, LLC
AMERICAN TELECASTING OF DENVER, LLC
AMERICAN TELECASTING OF FORT MYERS, LLC
AMERICAN TELECASTING OF FT. COLLINS, LLC
AMERICAN TELECASTING OF GREEN BAY, LLC
AMERICAN TELECASTING OF LANSING, LLC
AMERICAN TELECASTING OF LINCOLN, LLC
AMERICAN TELECASTING OF LITTLE ROCK, LLC
AMERICAN TELECASTING OF LOUISVILLE, LLC
AMERICAN TELECASTING OF MEDFORD, LLC
AMERICAN TELECASTING OF MICHIANA, LLC
AMERICAN TELECASTING OF MONTEREY, LLC
AMERICAN TELECASTING OF REDDING, LLC
AMERICAN TELECASTING OF SANTA BARBARA, LLC
AMERICAN TELECASTING OF SEATTLE, LLC
AMERICAN TELECASTING OF SHERIDAN, LLC
AMERICAN TELECASTING OF YUBA CITY, LLC
APC REALTY AND EQUIPMENT COMPANY, LLC
ASSURANCE WIRELESS OF SOUTH CAROLINA, LLC
ASSURANCE WIRELESS USA, L.P.
ATI SUB, LLC
BROADCAST CABLE, LLC
CLEAR WIRELESS LLC
CLEARWIRE COMMUNICATIONS LLC
CLEARWIRE HAWAII PARTNERS SPECTRUM, LLC
CLEARWIRE IP HOLDINGS LLC
CLEARWIRE LEGACY LLC
CLEARWIRE SPECTRUM HOLDINGS II LLC
CLEARWIRE SPECTRUM HOLDINGS III LLC
CLEARWIRE SPECTRUM HOLDINGS LLC
CLEARWIRE XOHM LLC
FIXED WIRELESS HOLDINGS, LLC
FRESNO MMDS ASSOCIATES, LLC
IBSV LLC
KENNEWICK LICENSING, LLC
L3TV CHICAGOLAND CABLE SYSTEM, LLC
L3TV COLORADO CABLE SYSTEM, LLC, each as a Guarantor
By: /s/ Johannes Thorsteinsson    
Name:    Johannes Thorsteinsson
Title:    Senior Vice President, Treasury & Treasurer
[Forty-Ninth Supplemental Indenture]

L3TV DALLAS CABLE SYSTEM, LLC
L3TV DC CABLE SYSTEM, LLC
L3TV DETROIT CABLE SYSTEM, LLC
L3TV LOS ANGELES CABLE SYSTEM, LLC
L3TV MINNEAPOLIS CABLE SYSTEM, LLC
L3TV NEW YORK CABLE SYSTEM, LLC
L3TV PHILADELPHIA CABLE SYSTEM, LLC
L3TV SAN FRANCISCO CABLE SYSTEM, LLC
L3TV SEATTLE CABLE SYSTEM, LLC
LAYER3 TV, LLC
METROPCS CALIFORNIA, LLC
METROPCS FLORIDA, LLC
METROPCS GEORGIA, LLC
METROPCS MASSACHUSETTS, LLC
METROPCS MICHIGAN, LLC
METROPCS NETWORKS CALIFORNIA, LLC
METROPCS NETWORKS FLORIDA, LLC
METROPCS NEVADA, LLC
METROPCS NEW YORK, LLC
METROPCS PENNSYLVANIA, LLC
METROPCS TEXAS, LLC
MINORCO, LLC
NEXTEL COMMUNICATIONS OF THE MID-ATLANTIC, INC.
NEXTEL OF NEW YORK, INC.
NEXTEL RETAIL STORES, LLC
NEXTEL SOUTH CORP.
NEXTEL SYSTEMS, LLC
NEXTEL WEST CORP.
NSAC, LLC
PCTV GOLD II, LLC
PCTV SUB, LLC
PEOPLE’S CHOICE TV OF HOUSTON, LLC
PEOPLE’S CHOICE TV OF ST. LOUIS, LLC
PRWIRELESS PR, LLC
PUSHSPRING, INC.
SFE 1, LLC
SIHI NEW ZEALAND HOLDCO, INC.
SPEEDCHOICE OF DETROIT, LLC
SPEEDCHOICE OF PHOENIX, LLC, each as a Guarantor
By: /s/ Johannes Thorsteinsson    
Name:    Johannes Thorsteinsson
Title:    Senior Vice President, Treasury & Treasurer
[Forty-Ninth Supplemental Indenture]

SPRINT (BAY AREA), LLC
SPRINT CAPITAL CORPORATION
SPRINT COMMUNICATIONS COMPANY L.P.
SPRINT COMMUNICATIONS COMPANY OF NEW HAMPSHIRE,
INC.
SPRINT COMMUNICATIONS COMPANY OF VIRGINIA, INC.
SPRINT COMMUNICATIONS, INC.
SPRINT CORPORATION
SPRINT EBUSINESS, INC.
SPRINT ENTERPRISE NETWORK SERVICES, INC.
SPRINT EWIRELESS, INC.
SPRINT INTERNATIONAL COMMUNICATIONS CORPORATION
SPRINT INTERNATIONAL HOLDING, INC.
SPRINT INTERNATIONAL INCORPORATED
SPRINT INTERNATIONAL NETWORK COMPANY LLC
SPRINT PCS ASSETS, L.L.C.
SPRINT SOLUTIONS, INC.
SPRINT SPECTRUM HOLDING COMPANY, LLC
SPRINT SPECTRUM REALTY COMPANY, LLC
SPRINT/UNITED MANAGEMENT COMPANY
TDI ACQUISITION SUB, LLC
THEORY MOBILE, INC.
T-MOBILE INNOVATIONS LLC
T-MOBILE LICENSE LLC
T-MOBILE NORTHEAST LLC
T-MOBILE PCS HOLDINGS LLC
T-MOBILE PUERTO RICO HOLDINGS LLC
T-MOBILE PUERTO RICO LLC
T-MOBILE RESOURCES LLC
T-MOBILE SOUTH LLC
T-MOBILE WEST LLC
TMUS INTERNATIONAL LLC
TRANSWORLD TELECOM II, LLC
TVN VENTURES LLC
USST OF TEXAS, INC.
UTELCOM LLC
VMU GP, LLC
WBS OF AMERICA, LLC, each as a Guarantor
By: /s/ Johannes Thorsteinsson    
Name:    Johannes Thorsteinsson
Title:    Senior Vice President, Treasury & Treasurer
[Forty-Ninth Supplemental Indenture]

WBS OF SACRAMENTO, LLC
WBSY LICENSING, LLC
WCOF, LLC
WIRELESS BROADBAND SERVICES OF AMERICA, L.L.C.
WIRELINE LEASING CO., INC., each as a Guarantor
By: /s/ Johannes Thorsteinsson    
Name:    Johannes Thorsteinsson
Title:    Senior Vice President, Treasury & Treasurer    


SPRINTCOM, INC.
SPRINT SPECTRUM L.P.
T-MOBILE FINANCIAL LLC
T-MOBILE LEASING LLC, each as a Guarantor



By: /s/ Johannes Thorsteinsson    
Name:     Johannes Thorsteinsson
Title:    Assistant Treasurer



T-MOBILE CENTRAL LLC, as a Guarantor



By: /s/ Johannes Thorsteinsson    
Name:     Johannes Thorsteinsson
Title:    Vice President

[Forty-Ninth Supplemental Indenture]

DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee



By:    /s/ Jeffrey Schoenfeld    
Name:    Jeffrey Schoenfeld
Title:    Vice President
By:    /s/ Chris Niesz    
Name:    Chris Niesz
Title:    Vice President

[Forty-Ninth Supplemental Indenture]

Schedule I
Entity Jurisdiction of
Organization
T-MOBILE INNOVATIONS LLC Delaware
TVN VENTURES LLC Delaware


I-1

EXHIBIT 10.1
T-Mobile US, Inc.
12920 SE 38th Street
Bellevue, WA 98006-1350


March 25, 2019


    Re:    Eligibility for Certain Payments and Benefits

Dear Dave:

This letter (the “Letter”) outlines certain payments and benefits that you will be eligible for if (i) you voluntary resign from T-Mobile US, Inc. (the “Company”) on or after October 29, 2020 and (ii) you provide the Company with at least (6) six months’ prior written notice of such resignation (a resignation that meets the requirements of both (i) and (ii), the “Separation”).

1.STI Award. Notwithstanding anything in the T-Mobile US, Inc. 2013 Omnibus Incentive Plan, as amended from time to time, and any successor plan thereto (the “Omnibus Plan”) or in your short-term (annual) incentive award (“STI Award”) agreement between you and the Company for the year in which your Separation occurs (the “STI Award Agreement”), upon your Separation, you will receive a pro-rata payment of your STI Award calculated based on the actual level of attainment of the applicable Performance Measures (as defined in the STI Award Agreement) during the portion of the year ending on the last day of the calendar quarter ending immediately prior to your Separation (i.e., determined as if the applicable performance period had ended as of the date of the last quarterly accounting accrual to occur prior to your Separation), as determined by the Company (or, if your Separation occurs during the first calendar quarter of the year, based on target performance), and pro-rated based on the number of days you were employed by the Company during the calendar year in which your Separation occurs (the “Pro-Rata STI Award”). The Pro-Rata STI Award will be paid to you within sixty (60) days following your Separation.

2.RSUs and PRSUs. Notwithstanding anything in the Omnibus Plan, that certain Letter Re: Severance Benefits, by and between you and the Company, dated April 28, 2018 (your “SLT Letter”) or in any award agreement between you and the Company evidencing the grant of an award of time-based restricted stock units (“RSUs”) or performance-based restricted stock units (“PRSUs”) (as applicable) (each, a “LTI Award Agreement”) (including any continued employment or continued service requirements set forth therein that would, absent this Letter, apply to the vesting and payment of your then-outstanding RSUs or PRSUs, as applicable), upon your Separation, your then-outstanding RSUs and PRSUs will be subject to the following provisions:

a.PRSUs and New RSUs. Your (i) PRSUs that are outstanding as of your Separation and (ii) RSUs are outstanding as of your Separation and that are granted on or after the date of this Letter (your “New RSUs”) will be subject to the following provisions (for clarity, your New RSUs shall not include any Existing RSUs (as defined below), which shall be treated as set forth in Section 2(b) below):

i.New RSUs. Upon your Separation, any then-outstanding and unvested New RSUs will remain outstanding and will continue to vest and be paid to you in accordance with the terms of the applicable LTI Award Agreement.
1

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ii.PRSUs. Upon your Separation, any then-outstanding and unvested PRSUs will remain outstanding and will continue to be eligible to vest and be paid to you in accordance with the terms of the applicable LTI Award Agreement; provided, however, that the number of PRSUs that vest and become payable to you, and the Adjustment Percentage (as defined in the applicable LTI Award Agreement), shall be determined based on the lesser of (i) the actual level of attainment of the applicable Performance Measures (as defined in the applicable LTI Award Agreement) during the applicable Performance Period (as defined in the applicable LTI Award Agreement), as determined by the Company following the conclusion of the Performance Period, or (ii) the actual level of attainment of the applicable Performance Measures during the portion of the applicable Performance Period ending on the date of your Separation (i.e., determined as if the applicable Performance Period had ended on the date of your Separation), as determined by the Company. Notwithstanding the foregoing, if your Separation also constitutes a qualifying termination of employment that triggers severance payments and benefits under your SLT Letter, then your PRSUs that are outstanding and unvested as of your Separation will be treated as provided under the SLT Letter (rather than as provided under this Section 2(a)).

iii.Death; Disability. Notwithstanding Sections 2(a)(i) and (ii) above, in the event of your death or Disability (as defined in the Omnibus Plan) following your Separation but prior to the last date on which any New RSUs and/or PRSUs become vested in accordance with Sections 2(a)(i) and (ii) above, your then-outstanding and unvested New RSUs and PRSUs will vest in full on the date of your death or Disability and be paid to you within sixty (60) days following the date of such death or Disability (and, with respect to your PRSUs, the applicable Adjustment Percentage shall be determined in accordance with Section 2(a)(ii) above).

b.Existing RSUs. Upon your Separation, your then-outstanding and unvested RSUs that were granted prior to the date of this Letter (your “Existing RSUs”) will vest in full (to the extent then-unvested) on the Release Effective Date (as defined below) and shall remain outstanding and eligible to vest on the Release Effective Date. For clarity, your Existing RSUs will be administered as exempt from Section 409A (as defined below) for purposes of this Letter and the SLT Letter.

3.COBRA Benefits. During the period commencing on the date of your Separation and ending on the earlier of the end of the last day of the eighteenth (18th) calendar month following the date of your Separation or, if earlier, the date on which you become eligible for coverage under a subsequent employer’s group medical and dental plans (in either case, the “COBRA Period”), subject to your valid election to continue healthcare coverage under Section 4980B of the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations thereunder, the Company will continue to provide to you and your dependents, at the Company’s sole expense, coverage under its group medical and dental plans at the same levels in effect on the date of your Separation; provided, however, that if (a) any plan pursuant to which such benefits are provided is not, or ceases prior to the expiration of the continuation coverage period to be, exempt from the application of Section 409A of the Code under Treasury Regulation Section 1.409A-1(a)(5), (b) the Company is otherwise unable to continue to cover you or your dependents under its group health plans, or (c) the Company cannot provide the benefit without violating applicable law (including, without limitation, Section 2716 of the Public Health Service Act), then, in any such case, an amount equal to the dollar value of the balance of the Company’s subsidy shall thereafter be paid to you in substantially equal, then-currently-taxable monthly installments over the COBRA Period (or remaining portion thereof) (collectively, the “COBRA Benefits”).

4.Continued Mobile Service Discounts. Following the date of your Separation, you shall continue to be eligible for the Company’s employee mobile service discount program, in accordance




with the terms of such program as in effect from time to time during such period (the “Continued Mobile Discounts”).

5.Release Requirement. Notwithstanding anything herein or in any applicable STI Award Agreement and any LTI Award Agreement (collectively, the “Award Agreements”) to the contrary, you will not be eligible to receive any of the payments and benefits described in Sections 1 through 4 above unless you execute and do not revoke a release of claims in a form prescribed by the Company that becomes effective and irrevocable no later than sixty (60) days following the date of your Separation (the date on which such release becomes effective and irrevocable, the “Release Effective Date”).

6.Exclusions; Amendment; No Other Modifications. Your Award Agreements will be deemed amended to the extent necessary to reflect this Letter. Except as otherwise expressly set forth in this Letter, the terms and conditions set forth in the Omnibus Plan, the SLT Letter and the Award Agreements will continue to apply to your STI Awards, RSUs and PRSUs following the date of this Letter.

7.Restrictive Covenants. Section 3 of the SLT Letter is hereby incorporated into this Letter as if first set forth herein, and the restrictive covenants set forth in Section 3 of the SLT Letter shall apply to you upon your Separation hereunder; provided, however, that notwithstanding anything to the contrary in the SLT Letter, for purposes of applying Section 3 of the SLT Letter to your Separation, the duration of the post-termination “Restricted Period” (as defined in Section 3 of the SLT Letter) shall extend through the later of (a) one (1) year following your Separation (or, if your Separation occurs within one (1) year following the closing of the Transaction (as defined in the SLT Letter), eighteen (18) months following your Separation) or (b) the last date on which any RSUs and/or PRSUs are paid to you in accordance with the terms of this Letter.

8.No Right to Continued Employment. Nothing contained in this Letter shall confer upon you any right to continue in the employ or service of the Company or affect the right of the Company to terminate your employment or service at any time.

9.No Tax Advice. The Company is not making any warranties or representations to you with respect to the income tax consequences associated with this Letter, the treatment of your STI Award, RSUs and/or PRSUs contemplated hereunder, the COBRA Benefits or the Continued Mobile Discounts and you are in no manner relying on the Company, its affiliates or any of their respective representatives for an assessment of such tax consequences. You are hereby advised to consult with your own tax advisor with respect to any tax consequences associated with this Letter.

10.Governing Law. This Letter shall be governed by and construed in accordance with the laws of the State of Delaware without giving effect to the principles of conflicts of laws, and applicable federal law.

11.Section 409A. Notwithstanding anything to the contrary in the Omnibus Plan, the SLT Letter, any LTI Award Agreement or this Letter, if the Company determines that paying any amounts to you in respect of your RSUs and/or PRSUs at the time(s) indicated in any Award Agreement or this Letter (as applicable) would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code, then no such payment shall be paid to you prior to the expiration of the six (6)-month period following your “separation from service” with the Company (within the meaning of Section 409A of the Code) if you are a “specified employee” (within the meaning of Section 409A of the Code) on the date of your separation from service. If the payment of any such amount is delayed as a result of the previous sentence, then on the first business day following the end of such six (6)-month period (or such earlier date upon which such amount can be paid under Section 409A without resulting in a prohibited distribution, including as




a result of your death), the Company shall pay you a lump-sum amount equal to the cumulative amounts that would have otherwise been payable to you during such six (6)-month period (without interest). For purposes of Section 409A of the Code, any right to a series of installment payments pursuant to this Agreement shall be treated as a right to a series of separate payments, and each RSU or PRSU (and any amounts payable in respect thereof) shall be treated separately from each other RSU and PRSU (and any amounts arising in connection therewith).

12.Miscellaneous. This Letter, together with the Omnibus Plan, the SLT Letter and the Award Agreements, sets forth the final and entire agreement of the parties with respect to the subject matter hereof and supersedes all prior agreements, promises, covenants, arrangements, communications, representations or warranties, whether oral or written, by the Company and you, or any representative of the Company or you, with respect to the subject matter hereof. This Letter may be amended at any time by the Company, provided that no amendment may, without your consent, materially impair your rights under any Award Agreement. This Letter may be executed in one or more counterparts, each of which will be deemed to be an original but all of which together will constitute one and the same instrument.

Please indicate your acknowledgment of, and agreement to, the terms and conditions set forth in this Letter by signing in the space below and returning a signed copy of this Letter to me. Please retain one fully-executed original for your files.

                
Sincerely,

                        T-Mobile US, Inc.

                        By: _/s/ Elizabeth A. McAuliffe _____________
                        Name: Elizabeth A. McAuliffe
                        Title: EVP, Human Resources
                        

Acknowledged, Agreed and Accepted:

/s/ David A. Miller_______________________________
David A. Miller

Date: March 28, 2019



EXHIBIT 10.2

T-Mobile US, Inc.
12920 SE 38th Street
Bellevue, WA 98006-1350


April 8, 2021

Dave Miller
c/o T-Mobile US, Inc.
12920 SE 38th Street
Bellevue, WA 98006-1350


    Re:    Compensation and Employment Terms


Dear Dave:

As we have discussed, this letter agreement (this “Letter”) outlines certain compensation and other terms of your employment with T-Mobile US, Inc. (the “Company”) during the period commencing on the date of this Letter and ending on the earlier of (i) the date of your termination of employment with the Company for any reason, and (ii) March 1, 2023 (such period, the “Term”). Capitalized terms used and not otherwise defined in this Letter will have the meanings set forth on Exhibit A attached hereto. Please note that this Letter and the terms set forth herein are subject to and contingent upon approval thereof by the Committee.

1.Performance Bonuses.

(a)Bonuses. For each of calendar years 2021 and 2022 (each, a “Performance Year”), you will be eligible to receive a cash performance bonus (each, a “Performance Bonus”) targeted at $1,500,000 (the “Target Bonus Amount”). Each Performance Bonus will be earned based on the attainment, during the Performance Year to which such Performance Bonus relates, of the same performance goals that apply to your annual short-term incentive award (“STI Award”) for such Performance Year (the “Corresponding STI Award”), as established by the Committee in its sole discretion and set forth in the award agreement evidencing the grant of such Corresponding STI Award (the “STI Award Agreement”). The actual amount of any Performance Bonus payable to you will range from 0% to 200% of the Target Bonus Amount and will be calculated by multiplying the Target Bonus Amount (or $1,500,000) by the Overall Corporate Attainment Factor (as defined in your STI Award Agreement for the Corresponding STI Award) for the applicable Performance Year, as determined by the Committee.

(b)Payment. Subject to Sections 1(c) and 4 below, any earned Performance Bonus will be paid to you on the date on which STI Awards are paid generally by the Company to its similarly-situated executives with respect to the applicable Performance Year (but no later than March 1st of the calendar year following the applicable Performance Year) (any such date, the “Payment Date”), subject to and conditioned upon your continued employment with the Company through the applicable Payment Date.

(c)Termination; Forfeiture. Except as otherwise provided in this Letter, upon a termination of your employment with the Company for any reason, any then-unpaid Performance Bonus(es) will be forfeited.

(d)Acknowledgement. You acknowledge and agree that the Performance Bonuses will not be taken into account for purposes of calculating your total target compensation, total direct compensation or eligible base earnings for calendar years 2021 and 2022 (including, without limitation, for purposes of calculating the target grant-date value of your annual long-term incentive awards for such calendar years), and will not constitute “STI Awards” for purposes of the Retirement Letter.

2.Annual STI Awards. Subject to Section 4 below and the Retirement Letter, any STI Awards that become payable to you following the date of this Letter in accordance with the terms of the applicable STI Award Agreement will be paid to you on the date on which STI Awards are paid generally by the Company to its similarly-situated executives with respect to the applicable calendar year (but no later than March 1st of the calendar year following the calendar year to which it relates). You will be granted an annual STI Award for each calendar year during
1



which you are still employed by the Company on the applicable annual STI Award grant date for such calendar year. In addition, if your employment is terminated by the Company other than for Cause, you resign for Good Reason or you incur a Separation (as defined in the Retirement Letter), in any case, prior to the applicable annual STI Award grant date during the calendar year in which your employment terminates, you will be eligible to receive a Pro-Rata STI Award (as defined in your Retirement Letter) in accordance with the terms of Section 4(a) below and/or the Retirement Letter (as applicable); provided that for purposes of calculating any such Pro-Rata STI Award, the target amount of your STI Award for the calendar year of your termination will be consistent with the relative target amount of your most recent STI Award in relation to similarly-situated executives. If your employment is terminated by the Company due to your death or Disability (as defined in the Company’s 2013 Omnibus Incentive Plan) prior to the applicable annual STI Award grant date during the calendar year in which your employment terminates, you will be eligible to receive 100% of the target amount of your STI Award for such calendar year, with such target amount to be consistent with the relative target amount of your most recent STI Award in relation to similarly-situated executives.

3.Annual LTI Awards. Notwithstanding anything to the contrary herein or in any other agreement between you and the Company, no annual long-term incentive (“LTI”) awards shall be granted to you following the date on which either you or the Company provides notice of the termination of your employment with the Company for any reason.

4.Termination Payments and Benefits.

(a)Termination Other Than for Cause; Resignation For Good Reason. In the event that, during the Term, your employment is terminated by the Company other than for Cause or you resign for Good Reason, then, subject to (x) your execution and non-revocation of a release of all claims in substantially the form used by the Company for other executive-level terminations (the “Release”) that becomes effective and irrevocable no later than sixty (60) days following the Termination Date, and (y) your compliance with the terms, conditions and requirements set forth in Section 5 hereof and any other applicable restrictive covenants set forth in any agreement between you and the Company (collectively, the “Restrictions”):

i. The Company will pay or provide to you the payments and benefits set forth in the Retirement Letter (as if your termination qualified as a “Separation” as defined in the Retirement Letter), subject to the terms and conditions set forth therein; and

ii. If the Termination Date occurs prior to the payment of any Performance Bonus for 2022, the Company will pay you a Performance Bonus for the calendar year in which the Termination Date occurs (or, if the Termination Date occurs in 2023, the Performance Bonus for 2022), calculated in the same manner as the Corresponding STI Award as set forth in paragraph 1 of the Retirement Letter (provided, for clarity, that such Performance Bonus payment will not be pro-rated), payable in a single lump-sum amount within seventy-four (74) days following the Termination Date; provided, that if the aggregate period during which you are entitled to consider and/or revoke the Release spans two calendar years, such Performance Bonus will be paid to you in the second such calendar year.

(b)Termination Due to Death or Disability. In the event that, during the Term, your employment is terminated by the Company due to your death or Disability, then, subject to (x) your (or your estate’s) execution and non-revocation of a Release that becomes effective and irrevocable no later than sixty (60) days following the Termination Date, and (y) your compliance with the Restrictions, the Company shall pay to you an amount equal to the Target Bonus Amount, payable in a single lump-sum amount within seventy-four (74) days following the Termination Date; provided, that if the aggregate period during which you are entitled to consider and/or revoke the Release spans two calendar years, such Target Bonus Amount will be paid to you in the second such calendar year.
(c)Limitations. If your employment terminates for any reason other than due to a Qualifying Termination (including due to your resignation without Good Reason), you will not be entitled to any Performance Bonus payments and the Company shall otherwise not have any obligations to you under Section 4(a) or (b).

(d)No Duplication of Benefits. If, upon a Qualifying Termination that occurs during the Term, you would otherwise become entitled to receive any severance payments or benefits (including any accelerated vesting) under any other plan, program, agreement or arrangement maintained by the Company or its affiliates in which you are eligible to participate or to which you are a party (including, without limitation, the Company’s 2013 Omnibus Incentive Plan, any STI Award Agreement or LTI award agreement between you and the Company, the Company’s Executive Continuity Plan or any employment agreement or compensation term sheet between the Company and you) (each, a “Severance Program”), then by signing this Letter, you acknowledge and agree that you will not be eligible to receive any severance payments or


benefits under such Severance Program to the extent they are duplicative with the payments and benefits set forth in Section 4(a) or (b) (as applicable).

5.Restrictive Covenants. To protect the trade secrets and confidential information of the Company and its customers and clients that have been and will be entrusted to you, the business goodwill of the Company and its subsidiaries that has been and will be developed in and through you and the business opportunities that have been and will be disclosed or entrusted to you by the Company and its subsidiaries, and as an additional incentive for the Company to enter into this Letter, and without limiting any provision of your confidentiality, restrictive covenant or similar agreement with the Company (or an affiliate thereof), you hereby agree as follows:

(a)Non-Competition. During the term of your employment and for a period of eighteen (18) months immediately following your Qualifying Termination (the “Restricted Period”), you shall not either directly or indirectly, with or without compensation: (A) engage in, provide, offer to provide, or assist anyone in providing, services to or for a business, entity or individual that is substantially the same as or similar to the Company’s Business or that competes with the Company’s Business, directly or indirectly, in the geographic areas where the Company conducts business; or (B) compete with the Company, its affiliates or its dealers within the geographic areas where such entities provide or are permitted to provide services.

(b)Non-Solicitation. During the Restricted Period, neither you nor any person or entity otherwise connected with you shall directly or indirectly solicit or aid others in soliciting, or otherwise assist Customers in obtaining service provided through any competitor of the Company in those markets being serviced by the Company, including but not limited to others providing the services of the type(s) described as the Business on Exhibit A attached hereto. During that portion of the Restricted Period following your Qualifying Termination, you shall not interfere with any established business relationship between the Company and any of its Customers, shall not call upon any Customer of the Company’s Business for the purpose of soliciting, selling, providing or delivering services or products of the kind which are the subject of the Company’s Business, and shall not render or provide any service to any Customer, including any person who was a Customer of the Company during the time that you were employed with the Company, that is the same as or similar to the service provided in the Company’s Business. In addition, during the Restricted Period, neither you nor any person or entity otherwise connected with you shall act, directly or indirectly, as a reseller or dealer of any such service in the geographic area where the Company provides or is permitted to provide service. You agree that while employed by the Company and during the Restricted Period, you shall not directly or indirectly induce or attempt to influence any employee of the Company to terminate his or her employment with the Company or to work for you or any other person or entity. You further agree to provide any potential future employer who provides any service described in the definition of “Business” with a copy of Section 5 of this Letter before you begin employment with any such person or entity.

(c)Reasonableness. You acknowledge that the restrictions contained in this Letter are reasonable in time, scope and geographic restraints, and do not unreasonably restrict your ability to obtain other employment. You further warrant that the restrictions do not impose an undue hardship on you, and do not deprive you of an ability to earn a living.

(d)Remedies. In the event of any material breach or threatened material breach of any of the provisions of Section 5(a) or (b) above, in addition to any other rights or remedies available to the Company, the Company shall have the right to seek monetary damages and equitable relief, including specific performance by means of temporary, preliminary or permanent injunctions against you or against your partners, agents, representatives, servants, employers, employees, family members and/or any and all persons acting directly or indirectly by or with you, to prevent or restrain such breach. With respect to any such equitable actions or proceedings, you agree that no adequate legal remedy exists, and hereby waive any defense that an adequate remedy at law exists and any requirement that the Company prove damages. You further waive any requirement that the Company furnish any bond or other security, and agree that to the extent a bond is nevertheless required by law, it shall be in the amount of $100.00. You agree that the Company’s right to seek injunctive and other equitable relief shall be and are cumulative and not exclusive and shall be in addition to any other remedies that the Company may have.

6.No Effect on Other Benefits. Other than as provided for in Section 4(d), nothing in this Letter shall affect your and the Company’s rights and obligations under any other Company agreement or arrangement to which you are a party or in which you are a participant that remains in effect, including, without limitation, the Retirement Letter (including, for the avoidance of doubt, the requirement that you provide at least six (6) months’ prior written notice in the event of your voluntary resignation of employment that does not constitute Good Reason), which shall remain in effect during the Term in accordance with its terms.



7.No Right to Continued Employment. Nothing contained in this Letter shall confer upon you any right to continue in the employ or service of the Company or affect the right of the Company to terminate your employment or service at any time.

8.No Tax Advice. The Company is not making any warranties or representations to you with respect to the income tax consequences associated with this Letter or the payments and benefits (including Performance Bonuses) payable hereunder, and you are in no manner relying on the Company, its affiliates or any of their respective representatives for an assessment of such tax consequences. You are hereby advised to consult with your own tax advisor with respect to any tax consequences associated with this Letter and the payments and benefits (including Performance Bonuses) payable hereunder.

9.Representations. By signing this Letter below, you hereby represent and warrant to the Company that (i) you have read and understand, and accept the terms and conditions set forth in, this Letter, and (ii) you have entered into and agreed to the terms and conditions of this Letter voluntarily.

10.Section 409A. The payments and benefits described in this Letter are intended to comply with or be exempt from Section 409A of the Code (“Section 409A”). See Exhibit B, which is hereby incorporated into this Letter, for additional details.

11.Governing Law. This Letter shall be governed by and construed in accordance with the laws of the State of Washington without giving effect to the principles of conflicts of laws, and applicable federal law.

12.Miscellaneous. This Letter, together with the Retirement Letter and any other agreements referenced herein, sets forth the final and entire agreement of the parties with respect to the subject matter hereof and supersedes all prior agreements, promises, covenants, arrangements, communications, representations or warranties, whether oral or written, by the Company and you, or any representative of the Company or you, with respect to the subject matter hereof. This Letter may be amended only in a writing signed by both you and the Company. This Letter may be executed in one or more counterparts, each of which will be deemed to be an original but all of which together will constitute one and the same instrument.

Please indicate your acknowledgment of, and agreement to, the terms and conditions set forth in this Letter by signing in the space below and returning a signed copy of this Letter to me. Please retain one fully-executed original for your files.

                
Sincerely,

                        T-Mobile US, Inc.

                        By: /s/ Deeanne King____________________
                        Name: Deeanne King
                        Title: Executive Vice President, Chief Human Resources Officer
                        

Acknowledged, Agreed and Accepted:

/s/ David A. Miller______________________________
David A. Miller

Date: April 8, 2021




Exhibit A

Definitions

(a)“Business” means the business of offering, providing and marketing to, and procuring, retail and wholesale customers for commercial mobile radio service (CMRS), including without limitation, cellular telephone service, personal communications service (PCS) and other wireless voice and data services, including, without limitation, (i) paging, messaging, radio, telephone, internet, voice over internet protocol (VOIP), Wi-Fi, Mobile Virtual Network Operator (MVNO), Telemetry (machine-to-machine) services, and ancillary services and applications, as they exist now and may be later developed, and (ii) the sale of all services, products, devices and other hardware used in connection with the services described above.

(b)“Cause” means any one or more of the following: (i) your gross neglect or willful material breach of your principal employment responsibilities or duties, (ii) a final judicial adjudication that you are guilty of any felony (other than a law, rule or regulation relating to a traffic violation or other similar offense that has no material adverse effect on the Company or any of its affiliates), (iii) your breach of any non-competition or confidentiality covenant between you and the Company or any affiliate of the Company, (iv) fraudulent conduct as determined by a court of competent jurisdiction in the course of your employment with the Company or any of its affiliates, (v) the material breach by you of any other obligation which continues uncured for a period of thirty (30) days after notice thereof by the Company or any of its affiliates and which is demonstrably injurious to the Company or affiliate.

(c)“Code” means the Internal Revenue Code of 1986, as amended from time to time, or any successor thereto.

(d)“Committee” means the Compensation Committee of the Company’s Board of Directors.

(e)“Customers” shall mean all customers and subscribers for whom the Company, you, or the Company’s other employees, agents or independent contractors perform services or make sales in the course of business (during, before and after your employment with the Company).

(f)“Good Reason” means the occurrence of any of the following conditions about which you notify the Company within not more than ninety (90) days after initial existence and which the Company does not cure within thirty (30) days of such notice: (i) a material diminution in your duties, authority or responsibilities; (ii) a material reduction in your annual base salary, target short-term incentive award opportunity, or target long-term incentive opportunity, except for across-the-board salary reductions based on the Company’s and subsidiaries’ financial performance similarly affecting all or substantially all management employees of the Company and its subsidiaries; (iii) the relocation of the office at which you were principally employed as of the date hereof to a location more than fifty (50) miles from the location of such office, or you being required to be based anywhere other than such office, except to the extent you were not previously assigned to a principal location and except for required travel on business to an extent substantially consistent with your business travel obligations as of the date hereof; or (iv) such other event, if any, as is set forth as “good reason” or “constructive termination” in your individual employment agreement or compensation term sheet (as applicable) with the Company.

(g)“Qualifying Termination” means a termination of your employment (a) by the Company other than for Cause, (b) due to your resignation for Good Reason, (c) by the Company due to your Disability, or (d) due to your death.

(h)“Retirement Letter” means that certain letter agreement, dated March 25, 2019, between you and the Company regarding your eligibility for certain payments and benefits upon your retirement from the Company, as may be amended from time to time.

(i)“Termination Date” means the effective date of your termination of employment with the Company.






Exhibit B

Section 409A

It is intended that the payments and benefits under this Letter comply with the provisions of Section 409A and the Treasury regulations relating thereto, or satisfy the requirements for an exemption from Section 409A, in each case to the extent applicable to this Letter and, accordingly, to the maximum extent permitted, this Letter shall be interpreted and be administered in a manner to be in compliance therewith. Notwithstanding anything contained herein to the contrary, to the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A, you shall not be considered to have terminated employment with the Company for purposes of this Letter, and no payment otherwise due upon a termination of employment shall be due to you under this Letter, until you would be considered to have incurred a “separation from service” from the Company within the meaning of Section 409A (a “Separation from Service”). Any payments described in this Letter that qualify for the “short-term deferral” exception from Section 409A shall not be treated as deferred compensation as described in Treasury Regulation Section 1.409A-1(b)(4) and will be paid under such exception unless applicable law requires otherwise. For purposes of Section 409A (including, without limitation, for purposes of Treasury Regulation Section 1.409A-2(b)(2)(iii) and the application of the short-term deferral exception), each payment under this Letter will be treated as a separate payment. Notwithstanding anything to the contrary in this Letter (whether under this Letter or otherwise), to the extent delayed commencement of any portion of the payments to be made to you upon your Separation from Service is required to avoid a prohibited payment under Section 409A(a)(2)(B)(i) of the Code, such portion of the payments shall be delayed and paid on the first business day after the earlier of (i) the date that is six (6) months following such Separation from Service or (ii) your death.

EXHIBIT 10.3
GUARANTEE ASSUMPTION AGREEMENT
GUARANTEE ASSUMPTION AGREEMENT dated as of March 30, 2021, by T-Mobile Innovations LLC, a limited liability company organized under the laws of the State of Delaware, and TVN Ventures LLC, a limited liability company organized under the laws of the State of Delaware (collectively, the “Additional Guarantors” and each an “Additional Guarantor”), in favor of Spectrum License Holder LLC (“License Holder I”), Sprint Spectrum License Holder II LLC (“License Holder II”), Sprint Spectrum License Holder III LLC (“License Holder III” and, together with License Holder I and License Holder II, “Lessors” and each, a “Lessor”) under that certain Intra-Company Spectrum Lease Agreement dated October 27, 2016 by and among Lessor, the Guarantors party thereto, Sprint Spectrum Intermediate HoldCo LLC and Sprint Communications, Inc. (as amended from time to time, the “Lease Agreement”).
Pursuant to Section 14 of the Lease Agreement, each Additional Guarantor hereby agrees to become a “Guarantor” for all purposes of the Lease Agreement. Without limiting the foregoing, each Additional Guarantor hereby:
(a) jointly and severally with the other Guarantors, guarantees to Lessors and their respective successors and assigns the prompt payment in full when due of any and all Guaranteed Obligations (as defined in the Lease Agreement) in the same manner and to the same extent as is provided in the Lease Agreement as if such Additional Guarantor were an original party thereto; and
(b) makes the representations and warranties as of the date hereof, and agrees to perform the covenants set forth in, Section 10 of the Lease Agreement with respect to itself and its obligations under this Guarantee Assumption Agreement.
This Guarantee Assumption Agreement shall be governed by, enforced and construed in accordance with, the laws of the State of New York without regard to conflict of laws principles.
[remainder of this page intentionally left blank]
 


IN WITNESS WHEREOF, the undersigned has caused this Guarantee Assumption Agreement to be duly executed and delivered as of the day and year first above written.
 
  
T-Mobile Innovations LLC


By:    /s/ Johannes Thorsteinsson                
    Name:    Johannes Thorsteinsson
    Title:    Senior Vice President, Treasury and Treasurer

[Guarantee Assumption Agreement]

IN WITNESS WHEREOF, the undersigned has caused this Guarantee Assumption Agreement to be duly executed and delivered as of the day and year first above written.
 
  
TVN Ventures LLC


By:    /s/ Johannes Thorsteinsson                
    Name:    Johannes Thorsteinsson
    Title:    Senior Vice President, Treasury and Treasurer

[Guarantee Assumption Agreement]

Accepted and agreed:


SPRINT SPECTRUM LICENSE HOLDER LLC
SPRINT SPECTRUM LICENSE HOLDER II LLC
SPRINT SPECTRUM LICENSE HOLDER III LLC

By:    /s/ Johannes Thorsteinsson                
    Name:    Johannes Thorsteinsson
    Title:    Senior Vice President, Treasury and Treasurer


[Guarantee Assumption Agreement]
EXHIBIT 10.4
FIRST AMENDMENT TO FIFTH AMENDED AND RESTATED MASTER RECEIVABLES PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO FIFTH AMENDED AND RESTATED MASTER RECEIVABLES PURCHASE AGREEMENT (this “Amendment”), dated as of June 18, 2021 (the “First Amendment Closing Date”), is by and among T-MOBILE AIRTIME FUNDING LLC, as Transferor, T-MOBILE PCS HOLDINGS LLC (“T-Mobile PCS Holdings”), in its individual capacity and as servicer, T-MOBILE US, INC. (“TMUS”), as a Performance Guarantor, T-MOBILE USA, INC. (“TMUSA”), as a Performance Guarantor, THE TORONTO-DOMINION BANK, as Administrative Agent for the Owners and as a Committed Purchaser and a Funding Agent, ATLANTIC ASSET SECURITIZATION LLC, as a Conduit Purchaser, CRÉDIT AGRICOLE CORPORATE AND INVESTMENT BANK, as a Committed Purchaser and a Funding Agent, MANHATTAN ASSET FUNDING COMPANY LLC, as a Conduit Purchaser, SUMITOMO MITSUI BANKING CORPORATION, as a Committed Purchaser and a Funding Agent, LANDESBANK HESSEN-THÜRINGEN GIROZENTRALE, as a Committed Purchaser and a Funding Agent, and MUFG BANK (EUROPE) N.V., GERMANY BRANCH, as a Committed Purchaser and a Funding Agent.
RECITALS:
WHEREAS, the parties hereto are parties to the Fifth Amended and Restated Receivables Purchase Agreement, dated as of March 2, 2021 (the “Existing MPRA” and, as amended by this Amendment and as may be further amended, supplemented or otherwise modified from time to time, the “MRPA”); and
WHEREAS, the parties hereto wish to amend the Existing MRPA, as set forth in this Amendment, to revise certain limits with respect to EPS/HPP Receivables;
NOW, THEREFORE, the parties hereto, in consideration of their mutual covenants hereinafter set forth and intending to be legally bound hereby, agree as follows:
ARTICLE 1

DEFINITIONS
Section 1.01.Capitalized Terms. Capitalized terms used in this Amendment (including in the introductory paragraph and the recitals) and not otherwise defined herein shall have the meanings ascribed thereto in the Existing MRPA.
ARTICLE 2

AMENDMENTS
Section 2.01.Amendments to the Existing MRPA. The parties hereto hereby agree, subject to the terms and conditions set forth herein and in reliance on the representations,


warranties, covenants and agreements contained herein, that, effective as of the First Amendment Closing Date, the Existing MRPA shall be amended as follows:
(a)Section 1.1 of the Existing MRPA shall be amended to add the following new definition of “EPS/HPP Cap Increase Notice” immediately after the definition of “Eligible Servicer” therein:
“EPS/HPP Cap Increase Notice” shall mean a notice issued by the Servicer to the Administrative Agent and the Funding Agents informing them of the Servicer’s election to increase the limit on the aggregate Nominal Value of EPS/HPP Receivables that may become part of the EPS/HPP Program during any Collection Period to the lesser of (x) $20,000,000 and (y) 1.00% of the Projected Pool Balance.
(b)The definition of “Monthly Report” in Section 1.1 of the Existing MRPA shall be deleted in its entirety and replaced with the following:
“Monthly Report” shall mean, collectively, (1) a report prepared by the Servicer in substantially the form of Exhibit E-1 hereto in the case of the initial Monthly Report following the Amendment and Restatement Closing Date and in substantially the form of Exhibit E-2 hereto in the case of all subsequent Monthly Reports and (2) a transmittal document to include additional statistical information setting forth the aggregate Nominal Value of, and the aggregate amount of Dilutions that occurred with respect to, Transferred Receivables that became EPS/HPP Receivables during the related Collection Period and whether such aggregate Nominal Value exceeded the lesser of (x) $10,000,000 (or, after the delivery of an EPS/HPP Cap Increase Notice (if applicable), $20,000,000) and (y) 1.00% of the Projected Pool Balance.
(c)Section 2.22(c) of the Existing MRPA shall be deleted in its entirety and replaced with the following:
The Servicer shall not permit any portion of any Receivable to become an EPS/HPP Receivable during any Collection Period to the extent that the aggregate Nominal Value of all EPS/HPP Receivables that become part of the EPS/HPP Program during such Collection Period (determined immediately prior to the time such amounts became EPS/HPP Receivables) would exceed the lesser of (x) $10,000,000 and (y) 1.00% of the Projected Pool Balance, unless the Servicer has issued an EPS/HPP Cap Increase Notice to the Administrative Agent and each of the Funding Agents by no later than the Determination Date related to such Collection Period. If an EPS/HPP Cap Increase Notice has been issued by the Servicer, the limit on the aggregate Nominal Value of EPS/HPP Receivables that may become part of the EPS/HPP Program during any Collection Period will be increased to the lesser of (x) $20,000,000 and (y) 1.00% of the Projected Pool Balance. Any failure of the Servicer to issue an EPS/HPP Cap Increase Notice on or before the Determination Date related to a Collection Period during which the
    2


$10,000,000 EPS/HPP limit was exceeded shall be deemed a breach of a covenant in this Agreement that has an Adverse Effect on the interest of any Funding Agent or any Owner for purposes of Section 7.1(g). The Servicer will include the amount of EPS/HPP Receivables with respect to each Collection Period in the related Monthly Report. In the event of an increase of the EPS/HPP limit on the aggregate Nominal Value of EPS/HPP Receivables that may become part of the EPS/HPP Program during any Collection Period to the lesser of (x) $20,000,000 and (y) 1.00% of the Projected Pool Balance, (i) the Servicer shall thereafter be required to determine the amount of Transferred Receivables which become EPS/HPP Receivables no less frequently than weekly and (ii) any breach of the $20,000,000 EPS/HPP limit during any Collection Period shall be deemed a breach of a covenant in this Agreement that has an Adverse Effect on the interest of any Funding Agent or any Owner for purposes of Section 7.1(g).
ARTICLE 3

EFFECTIVENESS; RATIFICATION
Section 3.01Effectiveness. This Amendment shall become effective, and this Amendment thereafter shall be binding on each of the parties hereto and their respective successors and assigns, as of the First Amendment Closing Date, upon the execution and delivery to the Administrative Agent and each Funding Agent of counterparts of this Amendment executed by each of the parties hereto.
Section 3.02Incorporation; Ratification.
(a)On and after the First Amendment Closing Date this Amendment shall be a part of the MRPA and each reference in the MRPA to “this Agreement” or “hereof”, “hereunder” or words of like import, and each reference in any other Related Document to the MRPA shall mean and be a reference to such MRPA as previously amended, and as amended, modified and consented to hereby.
(b)Except as expressly provided herein, the MRPA shall remain in full force and effect and is hereby ratified and confirmed by the parties hereto.
(c)After giving effect to this Amendment, the Performance Guaranty shall remain in full force and effect.
ARTICLE 4

MISCELLANEOUS
Section 4.01Representations and Warranties.
    3


(a)The Transferor hereby represents and warrants to the Administrative Agent and the Owners that its representations and warranties set forth in Section 3.1 of the MRPA are true and correct in all material respects as of the date hereof.
(b)T-Mobile PCS Holdings hereby represents and warrants to the Administrative Agent and the Owners that its representations and warranties set forth in Section 3.1 and Section 3.3 of the MRPA are true and correct in all material respects as of the date hereof.
(c)Each of TMUS and TMUSA hereby represents and warrants to the Administrative Agent and the Owners that its representations and warranties set forth in Section 3.4 of the MRPA are true and correct in all material respects as of the date hereof.
Section 4.02No Other Amendments or Consents; Status of MRPA and Related Documents. The amendments set forth herein are limited as specified and shall not be construed as an amendment, waiver or consent to any other term or provision of the Existing MRPA. Nothing herein shall obligate the Administrative Agent, any Conduit Purchaser, Committed Purchaser or Funding Agent to grant (or consent to) any future amendment, consent or waiver of any kind under or in connection with the MRPA or entitle the Transferor to receive any such amendment, consent or waiver under the MRPA. Except as otherwise expressly provided herein, this Amendment shall not constitute a waiver of any right, power or remedy of the Owners, the Funding Agents or the Administrative Agent set forth in the MRPA and Related Documents, and except as expressly provided herein, this Amendment shall have no effect on any term or condition of the MRPA or Related Documents.
Section 4.03Governing Law; Submission to Jurisdiction. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. EACH OF THE PARTIES TO THIS AMENDMENT HEREBY AGREES TO THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND ANY APPELLATE COURT HAVING JURISDICTION TO REVIEW THE JUDGMENTS THEREOF. EACH OF THE PARTIES HEREBY WAIVES ANY OBJECTION BASED ON FORUM NON CONVENIENS AND ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER IN ANY OF THE AFOREMENTIONED COURTS.
Section 4.04Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same Amendment. Delivery of an executed counterpart of a signature page to this Amendment by facsimile shall be effective as delivery of a manually executed counterpart of this Amendment. Each party agrees that this Amendment may be electronically signed, and that any
    4


electronic signatures appearing on this Amendment are the same as handwritten signatures for the purposes of validity, enforceability, and admissibility.
[Signatures on Following Page]
    5


IN WITNESS WHEREOF, each of the parties hereto have caused a counterpart of this Amendment to be duly executed as of the date first above written.

T-MOBILE AIRTIME FUNDING LLC,
as Transferor


By:     /s/ Johannes Thorsteinsson            
    Name:    Johannes Thorsteinsson
Title:    Senior Vice President, Treasury & Treasurer


T-MOBILE PCS HOLDINGS LLC,
in its individual capacity and as Servicer


By:     /s/ Johannes Thorsteinsson            
    Name:    Johannes Thorsteinsson
Title:    Senior Vice President, Treasury & Treasurer


T-MOBILE US, INC.,
as Performance Guarantor


By:     /s/ Johannes Thorsteinsson            
    Name:    Johannes Thorsteinsson
Title:    Senior Vice President, Treasury & Treasurer


T-MOBILE USA, INC.,
as Performance Guarantor


By:     /s/ Johannes Thorsteinsson            
    Name:    Johannes Thorsteinsson
Title:    Senior Vice President, Treasury & Treasurer

[Signature Page to First Amendment to Fifth A&R Master Receivables Purchase Agreement]


THE TORONTO-DOMINION BANK,
as Administrative Agent


By:     /s/ Jamie Giles                
    Name: Jamie Giles
    Title: Managing Director


THE TORONTO-DOMINION BANK,
as a Committed Purchaser


By:     /s/ Jamie Giles                
    Name: Jamie Giles
    Title: Managing Director


THE TORONTO-DOMINION BANK,
as a Funding Agent


By:     /s/ Jamie Giles                
    Name: Jamie Giles
    Title: Managing Director

[Signature Page to First Amendment to Fifth A&R Master Receivables Purchase Agreement]


ATLANTIC ASSET SECURITIZATION LLC,
as a Conduit Purchaser


By:     /s/ Michael Guarda                
    Name: Michael Guarda
    Title: Managing Director

By:     /s/ Roger Klepper                
    Name: Roger Klepper
    Title: Managing Director


CRÉDIT AGRICOLE CORPORATE AND INVESTMENT BANK,
as a Committed Purchaser


By:     /s/ Michael Guarda                
    Name: Michael Guarda
    Title: Managing Director

By:     /s/ Roger Klepper                
    Name: Roger Klepper
    Title: Managing Director


CRÉDIT AGRICOLE CORPORATE AND INVESTMENT BANK,
as a Funding Agent


By:     /s/ Michael Guarda                
    Name: Michael Guarda
    Title: Managing Director

By:     /s/ Roger Klepper                
    Name: Roger Klepper
    Title: Managing Director

[Signature Page to First Amendment to Fifth A&R Master Receivables Purchase Agreement]


MANHATTAN ASSET FUNDING COMPANY LLC,
as a Conduit Purchaser
By: MAF Receivables Corp., its Sole Member

By:     /s/ Lori Rezza                    
    Name: Lori Rezza
    Title: Vice President


SUMITOMO MITSUI BANKING CORPORATION,
as a Committed Purchaser


By:     /s/ Gail Motonaga                
    Name: Gail Motonaga
    Title: Executive Director


SMBC NIKKO SECURITIES AMERICA, INC.,
as a Funding Agent


By:     /s/ Yukimi Konno                
    Name: Yukimi Konno
    Title: Managing Director



[Signature Page to First Amendment to Fifth A&R Master Receivables Purchase Agreement]


LANDESBANK HESSEN-THÜRINGEN GIROZENTRALE,
as a Committed Purchaser


By:     /s/ Daniel Geflitter                
    Name: Daniel Geflitter
    Title: Authorized Signatory

By:     /s/ Bjorn Reinecke                
    Name: Bjorn Reinecke
    Title: Authorized Signatory


LANDESBANK HESSEN-THÜRINGEN GIROZENTRALE,
as a Funding Agent


By:     /s/ Daniel Geflitter                
    Name: Daniel Geflitter
    Title: Authorized Signatory

By:     /s/ Bjorn Reinecke                
    Name: Bjorn Reinecke
    Title: Authorized Signatory


[Signature Page to First Amendment to Fifth A&R Master Receivables Purchase Agreement]


MUFG BANK (EUROPE) N.V., GERMANY BRANCH,
as a Committed Purchaser


By:     /s/ Mark Selles                
    Name: Mark Selles
    Title: CFO

By:     /s/ Maarten Rosenberg            
    Name: Maarten Rosenberg
    Title: CRO-Deputy President


MUFG BANK (EUROPE) N.V., GERMANY BRANCH,.
as a Funding Agent


By:     /s/ Mark Selles                
    Name: Mark Selles
    Title: CFO

By:     /s/ Maarten Rosenberg            
    Name: Maarten Rosenberg
    Title: CRO-Deputy President



[Signature Page to First Amendment to Fifth A&R Master Receivables Purchase Agreement]

EXHIBIT 22.1
Subsidiary Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralize Securities of the Registrant
Guaranteed Securities

The following securities (collectively, the “T-Mobile USA Senior Notes”) issued by T-Mobile USA, Inc., a Delaware corporation and wholly-owned subsidiary of T-Mobile US, Inc. (the “Company”), were outstanding as of June 30, 2021, including those that may no longer be subject to reporting as provided by Regulation S-X Rule 13-01:

Description of Notes
4.000% senior notes due 2022
4.000% senior notes due 2022-1 held by affiliate
4.500% senior notes due 2026
4.500% senior notes due 2026-1 held by affiliate
2.250% senior notes due 2026
2.625% senior notes due 2026
5.375% senior notes due 2027
5.375% senior notes due 2027-1 held by affiliate
4.750% senior notes due 2028
4.750% senior notes due 2028-1 held by affiliate
2.625% senior notes due 2029
3.375% senior notes due 2029
2.875% senior notes due 2031
3.500% senior notes due 2031

The following securities (collectively, the “T-Mobile USA Senior Secured Notes”) issued by T-Mobile USA, Inc., a Delaware corporation and wholly-owned subsidiary of the Company, were outstanding as of June 30, 2021, including those that are not subject to reporting as provided by Regulation S-X Rule 13-01:

Description of Notes
3.500% senior secured notes due 2025
1.500% senior secured notes due 2026
3.750% senior secured notes due 2027
2.050% senior secured notes due 2028
3.875% senior secured notes due 2030
2.250% senior secured notes due 2031
2.550% senior secured notes due 2031
4.375% senior secured notes due 2040
3.000% senior secured notes due 2041
4.500% senior secured notes due 2050
3.300% senior secured notes due 2051
3.600% senior secured notes due 2060



The following securities (collectively, the “Sprint Senior Notes”) issued by Sprint Corporation, a Delaware corporation and wholly-owned subsidiary of the Company, were outstanding as of June 30, 2021, including those that may no longer be subject to reporting as provided by Regulation S-X Rule 13-01:

Description of Notes
7.250% senior notes due 2021
7.875% senior notes due 2023
7.125% senior notes due 2024
7.625% senior notes due 2025
7.625% senior notes due 2026

The following securities (collectively, the “Sprint Communications Senior Notes”) issued by Sprint Communications, Inc., a Kansas corporation and wholly-owned subsidiary of the Company, were outstanding as of June30, 2021, including those that may no longer be subject to reporting as provided by Regulation S-X Rule 13-01:

Description of Notes
11.500% senior notes due 2021
6.000% senior notes due 2022

The following securities (collectively, the “Sprint Capital Corporation Senior Notes”) issued by Sprint Capital Corporation, a Delaware corporation and wholly-owned subsidiary of the Company, were outstanding as of June 30, 2021, including those that may no longer be subject to reporting as provided by Regulation S-X Rule 13-01:

Description of Notes
6.875% senior notes due 2028
8.750% senior notes due 2032

The following securities (collectively, the “Sprint Spectrum Notes”) issued by Sprint Spectrum Co LLC (a Delaware limited liability company), Sprint Spectrum Co II LLC (a Delaware limited liability company), Sprint Spectrum Co III LLC (a Delaware limited liability company), each a wholly-owned subsidiary of the Company, were outstanding as of June 30, 2021, including those that may no longer be subject to reporting as provided by Regulation S-X Rule 13-01:

Description of Notes
3.360% Series 2016-1 A-1 Notes due 2021
4.738% Series 2018-1 A-1 Notes due 2025
5.152% Series 2018-1 A-2 Notes due 2028

Obligors

As of June 30, 2021, the obligors under the T-Mobile USA Senior Notes and the T-Mobile USA Senior Secured Notes consisted of the Company, as a guarantor, and its subsidiaries listed in the following table.



Name of Subsidiary Jurisdiction of Organization Obligor Type
Alda Wireless Holdings, LLC Delaware Guarantor
American Telecasting Development, LLC Delaware Guarantor
American Telecasting of Anchorage, LLC Delaware Guarantor
American Telecasting of Columbus, LLC Delaware Guarantor
American Telecasting of Denver, LLC Delaware Guarantor
American Telecasting of Fort Myers, LLC Delaware Guarantor
American Telecasting of Ft. Collins, LLC Delaware Guarantor
American Telecasting of Green Bay, LLC Delaware Guarantor
American Telecasting of Lansing, LLC Delaware Guarantor
American Telecasting of Lincoln, LLC Delaware Guarantor
American Telecasting of Little Rock, LLC Delaware Guarantor
American Telecasting of Louisville, LLC Delaware Guarantor
American Telecasting of Medford, LLC Delaware Guarantor
American Telecasting of Michiana, LLC Delaware Guarantor
American Telecasting of Monterey, LLC Delaware Guarantor
American Telecasting of Redding, LLC Delaware Guarantor
American Telecasting of Santa Barbara, LLC Delaware Guarantor
American Telecasting of Seattle, LLC Delaware Guarantor
American Telecasting of Sheridan, LLC Delaware Guarantor
American Telecasting of Yuba City, LLC Delaware Guarantor
APC Realty and Equipment Company, LLC Delaware Guarantor
Assurance Wireless of South Carolina, LLC Delaware Guarantor
Assurance Wireless USA, L.P. Delaware Guarantor
ATI Sub, LLC Delaware Guarantor
Broadcast Cable, LLC Delaware Guarantor
Clear Wireless LLC Nevada Guarantor
Clearwire Communications LLC Delaware Guarantor
Clearwire Hawaii Partners Spectrum, LLC Nevada Guarantor
Clearwire IP Holdings LLC New York Guarantor
Clearwire Legacy LLC Delaware Guarantor
Clearwire Spectrum Holdings II LLC Nevada Guarantor
Clearwire Spectrum Holdings III LLC Nevada Guarantor
Clearwire Spectrum Holdings LLC Nevada Guarantor
Clearwire XOHM LLC Delaware Guarantor
Fixed Wireless Holdings, LLC Delaware Guarantor
Fresno MMDS Associates, LLC Delaware Guarantor
IBSV LLC Delaware Guarantor
Kennewick Licensing, LLC Delaware Guarantor
Layer3 TV, LLC Delaware Guarantor
MetroPCS California, LLC Delaware Guarantor
MetroPCS Florida, LLC Delaware Guarantor
MetroPCS Georgia, LLC Delaware Guarantor


MetroPCS Massachusetts, LLC Delaware Guarantor
MetroPCS Michigan, LLC Delaware Guarantor
MetroPCS Networks California, LLC Delaware Guarantor
MetroPCS Networks Florida, LLC Delaware Guarantor
MetroPCS Nevada, LLC Delaware Guarantor
MetroPCS New York, LLC Delaware Guarantor
MetroPCS Pennsylvania, LLC Delaware Guarantor
MetroPCS Texas, LLC Delaware Guarantor
Nextel Communications of the Mid-Atlantic, Inc. Delaware Guarantor
Nextel of New York, Inc. Delaware Guarantor
Nextel Retail Stores, LLC Delaware Guarantor
Nextel South Corp. Georgia Guarantor
Nextel Systems, LLC Delaware Guarantor
Nextel West Corp. Delaware Guarantor
NSAC, LLC Delaware Guarantor
PCTV Gold II, LLC Delaware Guarantor
PCTV Sub, LLC Delaware Guarantor
People’s Choice TV of Houston, LLC Delaware Guarantor
People’s Choice TV of St. Louis, LLC Delaware Guarantor
PRWireless PR, LLC Delaware Guarantor
PushSpring, LLC Delaware Guarantor
SIHI New Zealand Holdco, Inc. Kansas Guarantor
SpeedChoice of Detroit, LLC Delaware Guarantor
SpeedChoice of Phoenix, LLC Delaware Guarantor
Sprint (Bay Area), LLC Delaware Guarantor
Sprint Capital Corporation Delaware Guarantor*
Sprint Communications, Inc. Kansas Guarantor*
Sprint Communications Company L.P. Delaware Guarantor
Sprint Communications Company of New Hampshire, Inc. New Hampshire Guarantor
Sprint Communications Company of Virginia, Inc. Virginia Guarantor
Sprint Corporation Delaware Guarantor*
Sprint eBusiness, Inc. Kansas Guarantor
Sprint Enterprise Network Services, Inc. Kansas Guarantor
Sprint eWireless, Inc. Kansas Guarantor
Sprint International Communications Corporation Delaware Guarantor
Sprint International Holding, Inc. Kansas Guarantor
Sprint International Incorporated Delaware Guarantor
Sprint International Network Company LLC Delaware Guarantor
Sprint PCS Assets, L.L.C. Delaware Guarantor
Sprint Solutions, Inc. Delaware Guarantor
Sprint Spectrum LLC Delaware Guarantor
Sprint Spectrum Realty Company, LLC Delaware Guarantor
Sprint/United Management Company Kansas Guarantor
SprintCom, Inc. Kansas Guarantor
T-Mobile Central LLC Delaware Guarantor


T-Mobile Financial LLC Delaware Guarantor
T-Mobile Innovations LLC Delaware Guarantor
T-Mobile Leasing LLC Delaware Guarantor
T-Mobile License LLC Delaware Guarantor
T-Mobile Northeast LLC Delaware Guarantor
T-Mobile PCS Holdings LLC Delaware Guarantor
T-Mobile Puerto Rico Holdings LLC Delaware Guarantor
T-Mobile Puerto Rico LLC Delaware Guarantor
T-Mobile Resources LLC Delaware Guarantor
T-Mobile South LLC Delaware Guarantor
T-Mobile USA, Inc. Delaware Issuer
T-Mobile West LLC Delaware Guarantor
TMUS International LLC Delaware Guarantor
TDI Acquisition Sub, LLC Delaware Guarantor
Transworld Telecom II, LLC Delaware Guarantor
TVN Ventures LLC Delaware Guarantor
USST of Texas, Inc. Texas Guarantor
Utelcom LLC Kansas Guarantor
VMU GP, LLC Delaware Guarantor
WBS of America, LLC Delaware Guarantor
WBS of Sacramento, LLC Delaware Guarantor
WBSY Licensing, LLC Delaware Guarantor
WCOF, LLC Delaware Guarantor
Wireless Broadband Services of America, L.L.C. Delaware Guarantor
Wireline Leasing Co., Inc. Delaware Guarantor

* These guarantors provide an unsecured guarantee of the T-Mobile USA Senior Secured Notes.

As of June 30, 2021, the obligors under the Sprint Senior Notes consisted of the Company, as a guarantor; Sprint Corporation (a Delaware corporation), as issuer and T-Mobile USA, Inc. (a Delaware corporation) and Sprint Communications, Inc. (a Kansas corporation) as guarantors.

As of June 30, 2021, the obligors under the Sprint Communications Senior Notes consisted of the Company, as a guarantor; Sprint Communications, Inc. (a Kansas corporation), as issuer and T-Mobile USA, Inc. (a Delaware corporation) and Sprint Corporation (a Delaware corporation) as guarantors.

As of June 30, 2021, the obligors under the Sprint Capital Corporation Senior Notes consisted of the Company, as a guarantor; Sprint Capital Corporation (a Delaware corporation), as issuer and T-Mobile USA, Inc. (a Delaware corporation), Sprint Corporation (a Delaware corporation) and Sprint Communications, Inc. (a Kansas corporation) as guarantors.

As of June 30, 2021, the obligors under the Sprint Spectrum Notes consisted of Sprint Spectrum Co LLC (a Delaware limited liability company), Sprint Spectrum Co II LLC (a Delaware limited liability company), Sprint Spectrum Co III LLC (a Delaware limited liability company), as co-issuers and Sprint Spectrum License Holder LLC (a Delaware limited liability company), Sprint Spectrum License Holder II LLC (a Delaware limited liability


company), Sprint Spectrum License Holder III LLC (a Delaware limited liability company), Sprint Spectrum PledgeCo LLC (a Delaware limited liability company), Sprint Spectrum PledgeCo II LLC (a Delaware limited liability company) and Sprint Spectrum PledgeCo III LLC (a Delaware limited liability company) as guarantors.

Pledged Security Collateral

As of June 30, 2021, the obligations under the T-Mobile USA Senior Secured Notes were secured by pledges of the capital stock of the following affiliates of the Company.

Name of
Issuer
Issuer Jurisdiction of Organization Number of Shares Owned Percent of Interest Owned Percent of Interest Pledged
Alda Wireless Holdings, LLC Delaware N/A 100% 100%
American Telecasting Development, LLC Delaware N/A 100% 100%
American Telecasting of Anchorage, LLC Delaware N/A 100% 100%
American Telecasting of Columbus, LLC Delaware N/A 100% 100%
American Telecasting of Denver, LLC Delaware N/A 100% 100%
American Telecasting of Fort Myers, LLC Delaware N/A 100% 100%
American Telecasting of Ft. Collins, LLC Delaware N/A 100% 100%
American Telecasting of Green Bay, LLC Delaware N/A 100% 100%
American Telecasting of Lansing, LLC Delaware N/A 100% 100%
American Telecasting of Lincoln, LLC Delaware N/A 100% 100%
American Telecasting of Little Rock, LLC Delaware N/A 100% 100%
American Telecasting of Louisville, LLC Delaware N/A 100% 100%
American Telecasting of Medford, LLC Delaware N/A 100% 100%
American Telecasting of Michiana, LLC Delaware N/A 100% 100%
American Telecasting of Monterey, LLC Delaware N/A 100% 100%
American Telecasting of Redding, LLC Delaware N/A 100% 100%
American Telecasting of Santa Barbara, LLC Delaware N/A 100% 100%
American Telecasting of Seattle, LLC Delaware N/A 100% 100%
American Telecasting of Sheridan, LLC Delaware N/A 100% 100%
American Telecasting of Yuba City, LLC Delaware N/A 100% 100%
APC Realty and Equipment Company, LLC Delaware N/A 100% 100%
Assurance Wireless of South Carolina, LLC Delaware N/A 100% 100%
Assurance Wireless USA, L.P. Delaware N/A 100% 100%
ATI Sub, LLC Delaware N/A 100% 100%
Broadcast Cable, LLC Delaware N/A 100% 100%
Clear Wireless LLC Nevada N/A 100% 100%
Clearwire Hawaii Partners Spectrum, LLC Nevada 14,027,249 units 100% 100%
Clearwire IP Holdings LLC New York N/A 100% 100%
Clearwire Legacy LLC Delaware N/A 100% 100%
Clearwire Spectrum Holdings II LLC Nevada N/A 100% 100%
Clearwire Spectrum Holdings III LLC Nevada N/A 100% 100%


Clearwire Spectrum Holdings LLC Nevada N/A 100% 100%
Clearwire XOHM LLC Delaware N/A 100% 100%
Fixed Wireless Holdings, LLC Delaware N/A 100% 100%
Fresno MMDS Associates, LLC Delaware N/A 100% 100%
IBSV LLC Delaware N/A 100% 100%
Kennewick Licensing, LLC Delaware N/A 100% 100%
Layer3 TV, LLC Delaware 1 100% 100%
Metro PCS California, LLC Delaware N/A 100% 100%
MetroPCS Florida, LLC Delaware N/A 100% 100%
MetroPCS Georgia, LLC Delaware N/A 100% 100%
MetroPCS Massachusetts, LLC Delaware N/A 100% 100%
MetroPCS Michigan, LLC Delaware N/A 100% 100%
MetroPCS Networks California, LLC Delaware N/A 100% 100%
MetroPCS Networks Florida, LLC Delaware N/A 100% 100%
MetroPCS Nevada, LLC Delaware N/A 100% 100%
MetroPCS New York, LLC Delaware N/A 100% 100%
MetroPCS Pennsylvania, LLC Delaware N/A 100% 100%
MetroPCS Texas, LLC Delaware N/A 100% 100%
Nextel Retail Stores, LLC Delaware N/A 100% 100%
Nextel Systems, LLC Delaware N/A 100% 100%
NSAC, LLC Delaware N/A 100% 100%
PCTV Gold II, LLC Delaware N/A 100% 100%
PCTV Sub, LLC Delaware N/A 100% 100%
People’s Choice TV of Houston, LLC Delaware N/A 100% 100%
People’s Choice TV of St. Louis, LLC Delaware N/A 100% 100%
PRWireless PR, LLC Delaware N/A 100% 100%
PushSpring, LLC Delaware 100 100% 100%
SIHI Mexico S. de R.L. de C.V. Mexico N/A 100% 65%
SIHI New Zealand HoldCo, Inc. Kansas 100 100% 100%
SIHI Scandinavia AB Sweden N/A 100% 65%
SpeedChoice of Detroit, LLC Delaware N/A 100% 100%
SpeedChoice of Phoenix, LLC Delaware N/A 100% 100%
Sprint (Bay Area), LLC Delaware N/A 100% 100%
Sprint (Thailand) Limited Thailand N/A 100% 65%
Sprint Brasil Servicos de Telecomunicacoes Ltda. Brazil N/A 100% 65%
Sprint Communications Company L.P. Delaware N/A 100% 4.94%
Sprint Communications Company of New Hampshire, Inc. New Hampshire 1,000 100% 100%
Sprint Communications Company of Virginia, Inc. Virginia 100,000 100% 100%
Sprint Corporation Delaware 1,000 100% 100%
Sprint Hong Kong Limited Hong Kong None 100% 65%
Sprint International Argentina SRL Argentina None 100% 65%


Sprint International Australia Pty. Limited Australia None 100% 65%
Sprint International Austria GmbH Austria None 100% 65%
Sprint International Caribe LLC Puerto Rico N/A 100% 65%
Sprint International Chile Limitada Chile N/A 100% 65%
Sprint International Colombia Ltda. Colombia N/A 100% 65%
Sprint International Communications Canada ULC Canada N/A 100% 65%
Sprint International Communications Corporation Delaware 268,641 100% 100%
Sprint International Communications Singapore Pte. Ltd. Singapore N/A 100% 65%
Sprint International Czech Republic S.R.O. Czech Republic N/A 100% 65%
Sprint International do Brasil Ltda. Brazil N/A 100% 65%
Sprint International Hungary Korlátolt Felelősségű Társaság Hungary N/A 100% 65%
Sprint International Japan Corp. Japan N/A 100% 65%
Sprint International Korea Korea N/A 100% 65%
Sprint International Network Company LLC Delaware N/A 100% 100%
Sprint International New Zealand New Zealand N/A 100% 65%
Sprint International Norway AS Norway N/A 100% 65%
Sprint International Spain, S.L. Spain N/A 100% 65%
Sprint International Taiwan Limited Taiwan N/A 100% 65%
Sprint PCS Assets, L.L.C. Delaware N/A 100% 100%
Sprint RUS LLC Russia N/A 100% 65%
Sprint Spectrum Depositor II LLC Delaware N/A 100% 100%
Sprint Spectrum Depositor III LLC Delaware N/A 100% 100%
Sprint Spectrum Depositor LLC Delaware N/A 100% 100%
Sprint Spectrum LLC Delaware N/A 100% 100%
Sprint Spectrum Realty Company, LLC Delaware N/A 100% 100%
Sprint Telecom India Private Limited India N/A 100% 65%
SprintLink Belgium BV Belgium N/A 100% 65%
SprintLink Denmark ApS Denmark N/A 100% 65%
SprintLink France SAS France N/A 100% 65%
SprintLink Germany GmbH Germany N/A 100% 65%
Sprintlink India Private Limited India N/A 100% 65%
SprintLink International (Switzerland) GmbH Switzerland N/A 100% 65%
Sprintlink International Malaysia SDN. BHD. Malaysia N/A 100% 65%
SprintLink International Philippines, Inc. Philippines N/A 100% 65%
SprintLink Ireland Limited Ireland N/A 100% 65%
SprintLink Italy S.r.l. Italy N/A 100% 65%
SprintLink Netherlands B.V. Netherlands N/A 100% 65%
Sprintlink Poland sp.z o.o Poland N/A 100% 65%
SprintLink UK Limited United Kingdom N/A 100% 65%
TDI Acquisition Sub, LLC Delaware N/A 100% 100%
TVN Ventures LLC Delaware N/A 100% 100%


T-Mobile Central LLC Delaware N/A 100% 100%
T-Mobile Financial LLC Delaware N/A 100% 100%
T-Mobile Leasing LLC Delaware N/A 100% 100%
T-Mobile License LLC Delaware N/A 100% 100%
T-Mobile Northeast LLC Delaware N/A 100% 100%
T-Mobile PCS Holdings LLC Delaware N/A 100% 100%
T-Mobile Puerto Rico Holdings LLC Delaware N/A 100% 100%
T-Mobile Puerto Rico LLC Delaware N/A 100% 100%
T-Mobile Resources LLC Delaware 1,000 100% 100%
T-Mobile South LLC Delaware N/A 100% 100%
T-Mobile USA, Inc. Delaware 1,000 100% 100%
T-Mobile West LLC Delaware N/A 100% 100%
TMUS International LLC Delaware N/A 100% 100%
Transworld Telecom II, LLC Delaware N/A 100% 100%
USST of Texas, Inc. Texas 1,000 100% 100%
VMU GP, LLC Delaware N/A 100% 100%
WBS of America, LLC Delaware N/A 100% 100%
WBS of Sacramento, LLC Delaware N/A 100% 100%
WBSY Licensing, LLC Delaware N/A 100% 100%
WCOF, LLC Delaware N/A 100% 100%
Wireless Broadband Services of America, L.L.C. Delaware N/A 100% 100%
Wireline Leasing Co., Inc. Delaware N/A 100% 4.94%



EXHIBIT 31.1

Certifications of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, G. Michael Sievert, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of T-Mobile US, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

August 3, 2021
/s/ G. Michael Sievert
G. Michael Sievert
Chief Executive Officer



EXHIBIT 31.2

Certifications of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Peter Osvaldik, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of T-Mobile US, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

August 3, 2021
/s/ Peter Osvaldik
Peter Osvaldik
Executive Vice President and Chief Financial Officer



EXHIBIT 32.1

Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of T-Mobile US, Inc. (the “Company”), on Form 10-Q for the quarter ended June 30, 2021, as filed with the Securities and Exchange Commission (the “Report”), G. Michael Sievert, Chief Executive Officer of the Company, does hereby certify, pursuant to § 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. § 1350), that to his knowledge:

1.The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

August 3, 2021
/s/ G. Michael Sievert
G. Michael Sievert
Chief Executive Officer



EXHIBIT 32.2

Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of T-Mobile US, Inc. (the “Company”), on Form 10-Q for the quarter ended June 30, 2021, as filed with the Securities and Exchange Commission (the “Report”), Peter Osvaldik, Executive Vice President and Chief Financial Officer of the Company, does hereby certify, pursuant to § 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. § 1350), that to his knowledge:

1.The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

August 3, 2021
/s/ Peter Osvaldik
Peter Osvaldik
Executive Vice President and Chief Financial Officer