Deutsche Telekom AG could miss out on a multi-billion dollar break fee if regulatory hurdles cause the failure of its $39 billion deal to sell T-Mobile USA to AT&T, a person familiar with the matter said.

There are a number of options under which the (break fee) contract will not come into effect, the person, who is familiar with the contract, told Reuters on Monday.

Deutsche Telekom declined comment.

The U.S. government last week sued to block AT&T's purchase of T-Mobile USA, a deal that would vault the combined company above Verizon Wireless as the No. 1 player in the United States.

As part of the AT&T deal, Deutsche Telekom had secured a break fee comprising $6 billion in cash and other assets should regulators reject the deal.

But the source said on Monday that AT&T will only have to pay that fee if certain conditions are met.

For instance, the acquisition has to receive regulatory approval within a certain timeframe, the source said. Otherwise, the contract is void.

Also, the value of T-Mobile USA may not fall below a certain level, the person said. That could happen, for instance, if regulators demand that parts of the company be sold as a condition for approval of the deal.

Shares of Deutsche Telekom fell 1.8 percent to 8.58 euros by 0920 GMT (5:20 a.m. ET). The stock has lost about 17 percent of its value over the past month.

AT&T's Frankfurt-listed shares were down 1.5 percent.

A German government official said on Thursday a deal for AT&T to buy T-Mobile USA could still be reached as the U.S. Department of Justice is holding talks with the two companies.

AT&T is expected to soon present a proposed solution to U.S. antitrust regulators to salvage the deal, people close to the matter said last week.

(Writing by Maria Sheahan; Editing by David Holmes)