Sprint - Nextel 2005 Annual Report Download - page 120

SPRINT NEXTEL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
intangible assets including goodwill in the amount of $249 million and customer relationships of $94 million.
See note 7 for information regarding the amortization expense for customer relationships. We are in the process
of completing our valuation of IWO Holdings’ assets and liabilities, as well as internal studies of assets, property,
plant and equipment, intangible assets, certain liabilities, and commercial contracts, which when final, may result
in additional adjustments to the purchase price allocation for the acquired assets and assumed liabilities of IWO
Holdings.
The results of operations of these 2005 affiliate purchase acquisitions are included in our consolidated financial
statements from the respective dates of acquisition. Pro forma information has not been provided for any of the
2005 affiliate acquisitions, as the impact to prior periods would have been immaterial.
Acquisitions Subsequent to December 31, 2005
On January 31, 2006, we completed the acquisition of Enterprise Communications Partnership, a PCS Affiliate,
for $77 million in cash.
On February 1, 2006, we completed the acquisition of Alamosa Holdings Inc., the largest PCS Affiliate, for $3.4
billion in cash.
On February 21, 2006, we acquired 94% of the voting stock of Velocita Wireless Holding Corporation for $157
million in cash. We expect to acquire the remaining 6% of Velocita Wireless in May 2006 for an additional $7
million in cash. Velocita Wireless owns and operates a nationwide digital packet-switched wireless data network
in the 900 MHz frequency band.
Note 3. Recombination of Tracking Stock
On April 23, 2004, we recombined our two tracking stocks. Each share of PCS common stock automatically
converted into 0.50 shares of FON common stock. The conversion of PCS common stock into FON common
stock resulted in an increase in FON common stock outstanding of 518.5 million shares as of April 23, 2004. As
of April 23, 2004, the FON Group and the PCS Group ceased to exist. Our common stock now represents all of
our operations and assets, including Wireless, Long Distance and Local operations. The financial statements are
shown as if the recombination had occurred as of the earliest period presented.
Earnings Per Common Share
For 2003, all per share amounts have been restated to reflect the recombination of the FON common stock and
PCS common stock at an identical conversion ratio of 0.50. The conversion ratio was also applied to dilutive
PCS securities (mainly stock options, employee stock purchase plan shares, convertible preferred stock and
restricted stock units) to determine diluted weighted average shares on a consolidated basis.
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