Sprint - Nextel 2007 Annual Report Download - page 112

SPRINT NEXTEL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
As of December 31, 2007, about $463 million of our outstanding debt, comprised of certain secured notes,
capital lease obligations and mortgages, is secured by $1.7 billion of gross property, plant and equipment and
other assets.
We are currently in compliance with all restrictive and financial covenants associated with all of our
borrowings. There is no provision under any of our indebtedness that requires repayment in the event of a
downgrade by any ratings service.
Senior Notes
As of December 31, 2007, we have $20.9 billion of convertible and senior serial redeemable notes. Cash
interest on these notes is payable semiannually in arrears. Most of our notes are redeemable at our discretion. We
may choose to redeem some or all of these notes at the then applicable redemption price, plus accrued and unpaid
interest. The $607 million in aggregate principal amount of our 5.25% notes due 2010 are convertible at any time
prior to redemption, repurchase or maturity at the option of the holders into shares of our Series 1 common stock
at an effective conversion price of $53.65 per share, plus $11.37 in cash for each $1,000 principal amount. As of
December 31, 2007, senior notes also included $117 million of debt associated with a consolidated variable
interest entity.
In 2007, we paid a total of $1.4 billion in cash for early redemptions of senior notes, that we redeemed in
their entirety, as follows:
• $150 million of IWO Holdings, Inc.’s Senior Secured Floating Rate Notes due 2012 that we redeemed
in January 2007 for $153 million in cash;
• $420 million of UbiquiTel Operating Company’s 9.875% Senior Notes due 2011 that we redeemed in
March 2007 for $451 million in cash;
• $475 million of Nextel Partners, Inc.’s 8.125% Senior Notes due 2011 that we redeemed in July 2007
for $494 million in cash; and
• $251 million of Alamosa (Delaware), Inc’s 11% Senior Notes due 2010 that we redeemed in July 2007
for $264 million in cash.
In June 2007, we completed the sale of $750 million in principal amount of floating rate notes due 2010.
Cash interest is payable quarterly in arrears on March 28, June 28, September 28 and December 28 of each year,
at a rate of three-month London Interbank Offered Rate, or LIBOR, plus 40 basis points. We may not redeem
these notes prior to maturity. These notes are senior unsecured obligations and rank equal in right of payment
with all our other unsecured senior indebtedness.
In November 2006, we completed the sale of $2.0 billion in principal amount of 6.0% senior serial
redeemable notes due 2016. Cash interest is payable semiannually in arrears on June 1 and December 1 of each
year commencing June 1, 2007, at an annual rate of 6.0%. We may choose to redeem some or all of these notes at
any time and from time to time at a redemption price equal to the greater of 100% of the principal amount and
the sum of the present values of the remaining scheduled payments of principal and interest discounted to the
redemption date, on a semi-annual basis, at a U.S. Treasury note interest rate for the remaining term, plus 30
basis points, plus, in each case, accrued interest. These notes are senior unsecured obligations and rank equal in
right of payment with all our other unsecured senior indebtedness.
F-27