NextWave Wireless Files Fiscal Year 2010 Financial Results

SAN DIEGO--(BUSINESS WIRE)--NextWave Wireless Inc. (OTCQB: WAVE) today announced that it has filed its Annual Report on Form 10-K with the Securities and Exchange Commission for the fiscal year 2010, which ended January 1, 2011.

The Form 10-K is available on the website maintained by the Securities and Exchange Commission at www.sec.gov and on the NextWave website at www.nextwave.com under the heading - Financial Information - SEC Filings. The financial information accompanying this press release should be reviewed together with the Notes to Condensed Consolidated Financial Statements, Management’s Discussion and Analysis of Financial Condition and Results of Operations and Risk Factors contained in the Form 10-K.

About NextWave Wireless

NextWave Wireless Inc. is a wireless technology company that manages and maintains worldwide wireless spectrum licenses.

Additional Information

This press release contains forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. There can be no assurances that forward-looking statements will be achieved. Actual events or results could differ materially from the events or results predicted by such statements. Important factors that could cause actual events or results to differ materially are discussed in greater detail in the filings of NextWave with the Securities and Exchange Commission. All such documents are available through the SEC's website at www.sec.gov. NextWave makes no commitment to update any forward-looking statements in order to reflect subsequent changes in events or circumstances except as may be required pursuant to applicable law.

NEXTWAVE WIRELESS INC. CONSOLIDATED BALANCE SHEETS (in thousands, except par value data)
	January 1, 2011			January 2, 2010
ASSETS
Current assets:
Cash and cash equivalents	$	42,528		$	15,056
Restricted cash and marketable securities		20			24,088
Wireless spectrum licenses held for sale		6,535			62,868
Unamortized debt issuance costs		3,262			74
Prepaid expenses and other current assets		1,092			2,472
Current assets of discontinued operations		3,632			23,678
Total current assets		57,069			128,236
Wireless spectrum licenses, net		437,781			409,156
Property and equipment, net		2,188			213
Other assets, including assets measured at fair value of $1,227 at January 2, 2010		115			6,959
Other noncurrent assets of discontinued operations		—			58,226
Total assets	$	497,153		$	602,790
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable	$	947		$	1,229
Accrued expenses		3,427			8,196
Current portion of long-term obligations		784,649			86,154
Other current liabilities		1,272			10,283
Current liabilities of discontinued operations		515			30,371
Total current liabilities		790,810			136,233
Deferred income tax liabilities		84,688			88,958
Long-term obligations, net of current portion		19,821			641,950
Other liabilities		—			9,577
Long-term liabilities and deferred credits of discontinued operations		—			1,729
Commitments and contingencies
Stockholders’ deficit:
Preferred stock, $0.001 par value; 25,000 shares authorized; 355 shares designated as Series A Senior Convertible Preferred Stock; no other shares issued or outstanding		—			—
Common stock, $0.007 par value; 57,143 shares authorized; 23,729 and 22,434 shares issued and outstanding at January 1, 2011 and January 2, 2010, respectively		166			157
Additional paid-in-capital		887,676			884,321
Accumulated other comprehensive income		21,116			14,437
Accumulated deficit		(1,307,124	)		(1,190,520	)
Stockholders’ deficit attributed to NextWave		(398,166	)		(291,605	)
Noncontrolling interest in subsidiary		—			15,948
Total stockholders’ deficit		(398,166	)		(275,657	)
Total liabilities and stockholders’ deficit	$	497,153		$	602,790

The accompanying notes are an integral part of these consolidated financial statements.

NEXTWAVE WIRELESS INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE LOSS (in thousands, except per share data)
	Years Ended
	January 1, 2011			January 2, 2010
Operating expenses:
General and administrative	$	28,670		$	33,185
Sales and marketing		—			207
Asset impairment charges		98			9,550
Restructuring charges (credits)		(581	)		3,788
Total operating expenses		28,187			46,730
Net gains on sales of wireless spectrum licenses		5,536			2,664
Loss from operations		(22,651	)		(44,066	)
Other income (expense):
Interest income		573			458
Interest expense		(211,880	)		(164,149	)
Gain on extinguishment of debt		37,988			—
Other income (expense), net		13,827			(8,211	)
Total other income (expense), net		(159,492	)		(171,902	)
Loss from continuing operations before income taxes		(182,143	)		(215,968	)
Income tax benefit		26,737			1,093
Net loss from continuing operations		(155,406	)		(214,875	)
Income (loss) from discontinued operations before income taxes, net of gains (losses) on divestiture of discontinued operations of $78,360, and $(22,643), respectively		52,832			(74,588	)
Income tax provision		(17,824	)		(822	)
Net income (loss) from discontinued operations		35,008			(75,410	)
Net loss attributed to noncontrolling interest in subsidiary		3,794			104
Net income (loss) from discontinued operations attributed to NextWave		38,802			(75,306	)
Net loss attributed to NextWave	$	(116,604	)	$	(290,181	)
Other comprehensive loss:
Net loss	$	(120,398	)	$	(290,285	)
Foreign currency translation adjustment		6,339			9,384
Total other comprehensive loss		(114,059	)		(280,901	)
Less: other comprehensive income (loss) attributable to noncontrolling interest in subsidiary		(4,134	)		98
Other comprehensive loss attributed to NextWave	$	(109,925	)	$	(280,999	)
Amounts attributed to NextWave common shares:
Loss from continuing operations, net of tax	$	(155,406	)	$	(214,875	)
Income (loss) from discontinued operations, net of tax		38,802			(75,306	)
Net loss attributed to NextWave common shares	$	(116,604	)	$	(290,181	)
Net income (loss) per share attributed to NextWave common shares – basic and diluted:
Continuing operations	$	(6.41	)	$	(9.54	)
Discontinued operations		1.60			(3.34	)
Net loss	$	(4.81	)	$	(12.88	)
Weighted average shares used in per share calculation		24,267			22,535

The accompanying notes are an integral part of these consolidated financial statements.

NEXTWAVE WIRELESS INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands)
	Years Ended
	January 1, 2011			January 2, 2010
OPERATING ACTIVITIES
Net loss	$	(120,398	)	$	(290,285	)
Income (loss) from discontinued operations, net of tax		35,008			(75,410	)
Loss from continuing operations		(155,406	)		(214,875	)
Adjustments to reconcile loss from continuing operations to net cash used in operating activities of continuing operations:
Amortization of intangible assets		7,716			7,675
Depreciation		534			514
Non-cash share-based compensation		1,078			1,779
Non-cash interest expense		211,590			153,762
Gain on extinguishment of debt		(37,988	)		—
Gain on sales of wireless spectrum licenses		(5,536	)		(2,664	)
Asset impairment charges		98			9,550
(Gains) losses from changes in estimated fair values of embedded derivatives		(12,537	)		7,359
Other non-cash adjustments		1,222			(378	)
Changes in operating assets and liabilities:
Prepaid expenses and other current assets		(107	)		(1,197	)
Other assets		(11	)		1,423
Accounts payable and accrued liabilities		(5,280	)		(5,514	)
Noncurrent deferred income tax liabilities		(26,763	)		(1,154	)
Other liabilities and deferred credits		(73	)		(4,131	)
Net cash used in operating activities of continuing operations		(21,463	)		(47,851	)
INVESTING ACTIVITIES
Proceeds from the sale of ARS securities		24,023			—
Proceeds from the sale of wireless spectrum licenses		12,880			26,423
Purchase of property and equipment		(2,625	)		—
Net cash provided by investing activities of continuing operations		34,278			26,423
FINANCING ACTIVITIES
Proceeds from long-term obligations		25,000			13,496
Payments on long-term obligations		(124,138	)		(62,455	)
Proceeds from the sale of common shares		141			426
Net cash used in financing activities of continuing operations		(98,997	)		(48,533	)
Cash provided (used) by discontinued operations:
Net cash used in operating activities of discontinued operations		(1,694	)		(18,543	)
Net cash provided by investing activities of discontinued operations		110,666			46,999
Net cash used in financing activities of discontinued operations		—			(88	)
Net cash provided by discontinued operations		108,972			28,368
Effect of foreign currency exchange rate changes on cash		(704	)		588
Net increase (decrease) in cash and cash equivalents		22,086			(41,005	)
Cash and cash equivalents, beginning of period		20,512			61,517
Cash and cash equivalents, end of period		42,598			20,512
Less cash and cash equivalents of discontinued operations, end of period		(70	)		(5,456	)
Cash and cash equivalents of continuing operations, end of period	$	42,528		$	15,056
SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid for interest	$	2,454		$	14,999
Cash paid for taxes		48			183
Noncash investing and financing activities:
Senior, Second and Third Lien Notes issued to noteholders in exchange for debt modification fees		21,249			—
Fair value of warrants issued in connection with Second Lien Notes		—			5,179
Common shares issued or arbitration settlement		—			2,200
Common shares issued for achievement of IPWireless 2007 revenue milestones		—			1,615

The accompanying notes are an integral part of these consolidated financial statements.