Sprint - Nextel 2007 Annual Report Download - page 30

for the quarter ended March 31, 2007. The Staff’s letter included a comment requesting amendment of our 2006
Form 10-K and first quarter 2007 Form 10-Q to provide more robust discussion of the trend of significant net
declines in our iDEN subscriber base, on a consecutive quarter-over-quarter basis during 2006, continuing
through the first quarter of 2007. In response to this comment, we have added additional disclosure to the
Management’s Discussion and Analysis of Financial Condition and Results of Operations section in this Form
10-K, in a manner consistent with disclosures presented in our second and third quarter 2007 Forms 10-Q.
Item 2. Properties
Our corporate headquarters is located in Overland Park, Kansas and consists of about 3,853,000 square feet.
Our gross property, plant and equipment at December 31, 2007 totaled $48.0 billion, distributed among the
business segments as follows:
2007
(in billions)
Wireless ......................................................... $41.4
Wireline ......................................................... 3.9
Corporate and other ................................................ 2.7
Total ............................................................ $48.0
Properties utilized by our Wireless segment consist of base transceiver stations, switching equipment and
towers, as well as leased and owned general office facilities and retail stores. We lease space for base station
towers and switch sites for our wireless network.
Properties utilized by our Wireline segment generally consist of land, buildings, switching equipment,
digital fiber-optic network and other transport facilities. We have been granted easements, rights-of-way and
rights-of-occupancy by railroads and other private landowners for our fiber-optic network.
As of December 31, 2007, about $463 million of 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.
Additional information regarding our commitments related to operating leases can be found in note 13 of the
Notes to Consolidated Financial Statements.
Item 3. Legal Proceedings
In March 2004, eight purported class action lawsuits relating to the recombination of our tracking stocks
were filed against us and our directors by holders of PCS common stock. Seven of the lawsuits were consolidated
in the District Court of Johnson County, Kansas. The eighth, pending in New York, was voluntarily stayed. The
consolidated lawsuit alleged breach of fiduciary duty in connection with allocations between the wireline
operations and the wireless operations before the recombination of the tracking stocks and breach of fiduciary
duty in the recombination. The lawsuit was settled for an amount not material to the company, and the settlement
was given final approval by the Court on December 12, 2007.
In September 2004, the U.S. District Court for the District of Kansas denied a motion to dismiss a
shareholder lawsuit alleging that our 2001 and 2002 proxy statements were false and misleading in violation of
federal securities laws to the extent they described new employment agreements with certain senior executives
without disclosing that, according to the allegations, replacement of those executives was inevitable. These
allegations, made in an amended complaint in a lawsuit originally filed in 2003, are asserted against us and
certain of our current and former officers and directors, and seek to recover any decline in the value of our
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