Sprint - Nextel 2008 Annual Report Download - page 155

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CLEARWIRE CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
20. Parent Company Only Condensed Financial Statements
Under the terms of agreements governing the indebtedness of Clearwire Communications, a subsidiary of
Clearwire, such subsidiary is significantly restricted from making dividend payments, loans or advances to
Clearwire. The restrictions have resulted in the restricted net assets (as defined in Securities and Exchange
Commission Rule 4-08(e)(3) of Regulation S-X) of Clearwire’s subsidiary exceeding 25% of the consolidated
net assets of Clearwire and its subsidiaries.
The following condensed parent-only financial statements of Clearwire account for the investment in
Clearwire Communications under the equity method of accounting. The financial statements should be read in
conjunction with the consolidated financial statements of Clearwire and subsidiaries and notes thereto. As
described in Note 1 — Description of Business, Clearwire was formed November 28, 2008 and therefore, the
condensed statement of operation and the condensed statement of cash flow for 2008 only included activity from
November 29, 2008 to December 31, 2008.
F-89