Sprint - Nextel 2008 Annual Report Download - page 147

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CLEARWIRE CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
result, the income (loss) consolidated by Clearwire is decreased in proportion to the outstanding non-controlling
interests. Currently, at the Clearwire level, non-controlling interests represent approximately 79% of the
non-economic voting interests.
Warrants
All Old Clearwire warrants issued and outstanding at the Closing were exchanged on a one-for-one basis for
warrants to purchase our Class A Common Stock with equivalent terms. The fair value of the warrants
exchanged of $18.5 million is included in the calculation of purchase consideration using the Black-Scholes
option pricing model using a share price of $6.62. Holders may exercise their warrants at any time, with exercise
prices ranging from $3.00 to $48.00. Old Clearwire granted the holders of the warrants registration rights
covering the shares subject to issuance under the warrants. The number of warrants outstanding at December 31,
2009 was 17,806,220. The warrants expire on August 5, 2010, but the term is subject to extension in certain
circumstances.
16. Net Loss Per Share
Basic Net Loss Per Share
The net loss per share attributable to holders of Class A Common Stock is calculated based on the following
information (in thousands, except per share amounts):
Year Ended
December 31,
2009
Period From
November 29,
2008 to
December 31,
2008
Net loss ................................................... $(1,253,846) $(189,654)
Non-controlling interests in net loss of consolidated subsidiaries ...... 928,264 159,721
(325,582) (29,933)
Distribution to warrant and restricted stock unit holders ............. (9,491) —
Net loss attributable to Class A Common Stockholders .............. $ (335,073) $ (29,933)
Weighted average shares Class A Common Stock outstanding ........ 194,696 189,921
Loss per share .............................................. $ (1.72) $ (0.16)
The subscription rights we distributed on December 21, 2009 to purchase shares of Class A Common Stock
to Class A Common Stockholders of record on December 17, 2009, warrant holders, and certain holders of RSUs
represent a dividend distribution. Certain Participating Equityholders and Google, who were Class A Common
Stockholders of record holding approximately 102 million shares and entitled to the subscription rights, agreed
not to exercise or transfer their rights. The fair value of the rights distributed was $57.5 million or $0.51 per share
of Class A Common Stock. Certain outstanding warrants meet the definition of participating securities as their
terms provide for participation in distributions with Class A Common Stock prior to exercise. Therefore, the
two-class method is used to compute the loss per share and as a result, the fair value of the rights distributed to
the warrant and RSU holders of $9.5 million increased the net loss attributable to Class A Common Stockholders.
Diluted Loss Per Share
The potential exchange of Clearwire Communications Class B Common Interests together with Class B
Common Stock for Class A Common Stock will have a dilutive effect on diluted loss per share due to certain tax
effects. That exchange would result in both an increase in the number of Class A Common Stock outstanding and
a corresponding increase in the net loss attributable to the Class A Common Stockholders through the elimination
of the non-controlling interests’ allocation. Further, to the extent that all of the Clearwire Communications
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