HANNA& HANNAPLLC Attorneys at Law 1206 VIRGINIA STREET EAST, SUITE 201 CHARLESTON, WV 25301 MAILING ADDRESS: TELEPHONE (304) 342-1687 P.O. BOX3967 (304) 342-8761 CHARLESTON, WV 25339 November 26,2012 www. hannalawpllc.com

VIA HAND DELIVERY Sandra Squire Executive Secretary Public Service Commission 201 Brooks Street Charleston, WV 25301 Re: Case No. 12 - /3-5?3 --‘T-fC SPRINT NEXTEL CORPORATION AND ITS WEST VIRGINIA OPERATING ENTITIES AND STARBURST II, INC. Joint Petition for the consent and approval in advance of an indirect transfer of control of Sprint Nextel Corporation to Starburst II, Inc. Dear Ms. Squire:

In connection with the above case, I hand you herewith for filing the original and twelve (12) copies of a verified Joint Petition of Sprint Nextel Corporation (“Sprint”) and its West Virginia Operating entities and Starburst II, Inc. (“Starburst”) seeking advance approval of an indirect transfer of control of Sprint to Starburst, to the extent required by applicable law.

Please add co-counsel Thomas N. Hanna, Esq., [email protected], to the list to be served copies of all documents electronically. If you have any questions, please contact us.

Sincerely,

David 6. Hanna 44 MA/ State Bar # 8813 d hanna@ hannalawpllc. corn DBHldh Enclosures cc: S. Berlin, Esq. PUBLIC SERVICE COMMISSION OF WEST VIRGINIA CHARLESTON

CASE NO.

SPRINT NEXTEL CORPORATION AND ITS WEST VIRGINIA OPERATING ENTITIES AND STARBURST 11, INC.

Joint Petition for approval of an Indirect Transfer of Control of Sprint Nextel Corporation to Starburst 11, Inc.

JOINT PETITION

Pursuant to W. Vu. Code 8 24-2-12(g) and Rule 10.10 of the Rules of Practice and

Procedure, 150 WVCSR Series 1, Sprint Nextel Corporation (“Sprint”), on behalf of its operating entities authorized to provide services in West Virginia, Sprint

Communications Company L.P., SprintCom, Inc., Sprint Spectrum, L.P., d/b/a Sprint PCS,

Nextel South Corp., Boost Mobile LLC, and Virgin Mobile USA, L.P., (collectively “Sprint

West Virginia Operating Entities”)’ and Starburst II, Inc. (“Starburst II”) (collectively, “Joint

Petitioners”) hereby give notice and, to the extent required, jointly seek the Commission’s prior consent and approval to allow Joint Petitioners to effectuate a transaction under which Starburst

I1 will become the direct parent of Sprint and indirect parent of the Sprint West Virginia

Operating Entities and by which SOFTBANK CORP. (“SoftBank”) will, through its newly formed affiliate Starburst 11, invest $20.1 billion in Sprint and indirectly acquire approximately

I See GTE Sprint Communications Corporation, Case No. 84- 140-T-CN, Application for certzjkate of convenience and necessity to offer intercity services to the public in the State of West Virginia, Final Order issued December 14, 1984; See also Sprint Communications Company L.P., Case No. 02-0164-T-CN Application for a certiycate of convenience and necessity to provide resold and facilities-based local exchange and interexchange telecommunications services to customers throughout the State of West Virginia, Order granting authority final September 9, 2002. Sprint’s subsidiary, Virgin Mobile USA, L.P., is designated by the Commission as an Eligible TelecommunicationsCarrier for the limited purpose of participating in the federal Lifeline program. See Case No. 10-0246-C-PC,Petition for consent and approval for limited designation as an eligible telecommunications carrier, Order granting authority final September 20,2010. 70 percent of the shares of Sprint. This transaction is at the parent holding company level only.

Accordingly, the Sprint entities authorized to provide service in West Virginia will not be directly affected by the transaction described herein and will continue to be indirect wholly- owned subsidiaries of Sprint.

Finally, as discussed in more detail below, the terms and conditions of this Transaction are reasonable, neither party is given undue advantage over the other, and this Transaction will not adversely affect the public in this State. W.Va. Code 0 24-2-12.

In support of this Joint Application, Joint Petitioners respectfully show as follows:

DESCRIPTION OF THE APPLICANTS

A. Sprint

Sprint is a publicly traded Kansas corporation with a principal business office in

Overland Park, Kansas. Sprint has no majority owner, although two institutional investors hold a greater than 10 percent ownership interest in Sprint.’ Sprint is a global communications company that, through its s~bsidiaries,~offers a comprehensive range of wireless and wireline voice and data products and services designed to meet the needs of residential consumers, businesses, government subscribers, and resellers throughout the country and around the globe.

Sprint offers wireless and wireline voice and data services in West Virginia and throughout the

United States. In addition, Sprint also is one of the country’s largest carriers of traffic and provides Internet connectivity in West Virginia.

2 Recent Schedule 13-G filings with the Securities and Exchange Commission (“SEC”) demonstrate that: (1) Capital Research Global Investors, a U.S. investment advisor company, is the beneficial owner of approximately 10.7 percent of Sprint’s common stock; and (2) Dodge & Cox, a U.S.investment advisor company, is the beneficial owner on behalf of itself and its clients of 10.3 percent of Sprint’s common stock. See Capital Research Global Investors, Schedule 13-G (April 9,2012); Dodge & Cox, Schedule 13-G (June 7,2012). 3 Sprint is primarily a holding company. Most of Sprint’s operations are conducted by its subsidiaries, including, but not limited to, the Sprint West Virginia Operating Entities.

2 B. Starburst I1 and SoftBank

Starburst I1 is a newly-formed Delaware corporation that will hold all shares of Sprint at

closing. Starburst I1 will be renamed . Starburst 11’s principal offices are located at 38 Glen Avenue, Newton, Massachusetts 02459. At this time, Starburst I1 does not provide telecommunications services or hold any telecommunications licenses. As discussed below, upon consummation of the proposed transaction, approximately 70 percent of Starburst

11’s common stock will be held, through a holding company, by SoftBank.

SoftBank is a publicly-traded holding company, organized and existing under the laws of

Japan and headquartered in Tokyo, Japana4 SoftBank’s founder and Chief Executive Officer,

Mr. , a citizen of , holds 22.49 percent of SoftBank’s issued and outstanding

share^.^ No other individual or entity holds 10 percent or more of SoftBank’s equity. SoftBank has been listed on the Tokyo stock exchange since 199ti6

SoftBank’s wholly owned subsidiary, SOFTBANK MOBILE Corp. (“SoftBank Mobile”) is currently the third largest wireless carrier in Japan, with approximately 30.5 million subscribers, giving it approximately 22 percent of the Japanese wireless market as of September

4 SoftBank’s annual reports can be found at http://www.softbank.co.jp/en/irinfo/library/annual_reports/. Softl3ank’s consolidated financial statements reflecting information through September 30,2012, can be found at httr,://www,softbank.co.ip/en/irinfo/librarv/financialreport/.

5 Mr. Masayoshi Son’s 22.49 percent interest includes both the 21.09 percent of SoftBank shares that he owns directly and an additional 1.40 percent that he owns indirectly.

6 Based on SoftBank’s most recent share register, no single person or entity other than Mr. Son currently owns more than 10 percent of SoftBank’s shares. A recent public securities filing in Japan analogous to the Form 13D of the U.S.Securities and Exchange Commission, however, indicates that each of four entities affiliated with The Capital Group Companies, Inc. (“Capital Group”) beneficially own interests in SoftBank that are below 10 percent but that aggregate to 10.04 percent of SoftBank’s stock. Capital Group is an investment management company headquartered in Los Angeles, California. The above-described informational filing states that these Capital Group affiliates hold SoftBank stock as follows: Capital Research and Management Company (8.34 percent); Capital Guardian Trust Company (1.39 percent); Capital International Limited (0.16 percent); and Capital International Inc. (0.14 percent).

3 30,2012. SoftBank Mobile generated wireless revenues of nearly $27.6 billion in fiscal year

2011, which ended on March 31,2012.

SoftBank also provides wireline broadband and telecommunications services in Japan

through two wholly owned subsidiaries, SOFTBANK BB Corp. (“SoftBank BB”) and

SOFTBANK TELECOM Corp. (“SoftBank Telecom”). SoftBank BB provides residential

wireline broadband service to approximately 4.3 million customers in Japan, and SoftBank

Telecom provides enterprise-level voice and data services to approximately 1.7 million

subscribers in Japan.

SoftBank holds no authorizations from the Commission and has no customers in the State

of West Virginia. SoftBank’s sole telecommunications interest in the United States is JAPAN

TELECOM AMERICA, INC.(“JTA”), which is a wholly owned subsidiary of SoftBank

Telecom. Although JTA holds an international Section 214 authorization from the FCC, JTA

provides only limited private line services to its sole customer, SoftBank Telecom, and has no

U.S. customers.

Starburst I1 and SoftBank are managerially, technically, and financially well-qualified.

As noted above, SoftBank and its subsidiaries have extensive experience in the

telecommunications business and have made significant inroads into the Japanese wireless and

wireline markets by offering superior services and value to customers. The Sprint West Virginia

Operating Entities will continue to have the technical, and financial qualifications needed to provide excellent service to West Virginia customers.

4 I. DESIGNATED CONTACTS

Questions, correspondence, orders, and other communications con ming this Joint

Application should be directed to the following:

I For the Sprint West Virginia Operating For Starburst I1 and SoftBank Entities and Sprint David B. Hanna Ronald D. Fisher Hanna & Hanna PLLC Steven J. Murray 1206 Virginia Street East, Suite 201 Starburst 11, Inc. P.O. Box 3967 38 Glen Avenue Charleston, W 25339 Newton, Massachusetts 02459 (304) 342-1687 (617) 928-9300 dhanna (9 hannalawpllc.com Ron Fisher 0softba&.com and Steve Murray@softbalk. corn Susan J. Berlin and Sprint Michael Pryor 3065 Akers Mill Rd. SE J.G. Harrington Atlanta, Georgia 30339 DOW LOHNES PLLC (404) 649-8983 1200 New Hampshire Ave., NW [email protected] Suite 800 Washington, D.C. 20036 (202) 776-2000 MPryor @dowlohnes.com JHai-rinrzton@dowlohnes .coin

DESCRIPTION OF THE TRANSACTION

On October 15,2012, Sprint and SoftBank announced that they had entered into

agreements that will result in SoftBank investing over $20 billion in Sprint and acquiring an

approximately 70 percent indirect interest in Sprint, with the remaining interest held by existing

Sprint shareholder^.^ Under the terms of the agreements, SoftBank formed a U.S. holding company, Starburst I, Inc. (“Starburst I”) which is wholly owned by SoftBank. Starburst I formed another new subsidiary, Starburst 11, which directly owns a third subsidiary, Starburst 111,

I These agreements are available at: http://investors.sprint.corn/file.aspx?IID=4057219&FID= 1473 155 1&0=3&0SID=9 . .

5 Inc. (“Merger Sub”). As part of the transaction, Sprint will merge with Merger Sub, with Sprint

being the surviving entity. A diagram depicting the pre-transaction corporate organization

structure is appended hereto as Exhibit A and a diagram depicting the post-transaction corporate

organization is appended hereto as Exhibit B.

As part of the transaction, Sprint shareholders will receive an aggregate of approximately

$12.1 billion from SoftBank via its subsidiaries in exchange for approximately 1.7 billion shares

of Sprint stock.* Sprint shareholders will have the right to elect to exchange each of their

existing shares of Sprint for (1) $7.30 in cash or (2) one share of Starburst I1 stock.g In addition,

SoftBank, via its subsidiaries, will contribute an aggregate of $8 billion to Sprint’s balance sheet

in conjunction with this transaction; these funds are unrestricted and Sprint will have the

flexibility to use this capital infusion to strengthen its balance sheet and invest in both its

wireless and wireline networks.”

After the transaction is consummated, Sprint will be a wholly-owned subsidiary of

Starburst 11, with SoftBank, through Starburst I, owning slightly less than 70 percent of the

8 SoftBank also will receive a five year warrant to purchase approximately 55 million shares of Starburst II (representing slightly less than 1 percent of Starburst II’s common stock) with an exercise price of $5.25 per share.

9 The elections by Sprint shareholders are subject to proration if shareholders in the aggregate elect more than the total amount of cash or stock consideration, which would result in the receipt of a mix of cash and stock. The proration is to ensure that approximately $12.1 billion in cash is paid in the merger to Sprint shareholders and only approximately 30.1 percent of Starburst II’s common stock. Holders of Sprint stock options and other employee incentive awards will receive options and similar awards in Starburst II.

Io SoftBank, via Starburst I, will contribute approximately $4.9 billion to Starburst 11 in exchange for approximately 926 million shares of newly issued stock in addition to the approximately $12.1 billion to be paid in the merger to Sprint shareholders. SoftBank already has invested $3.1 billion in Sprint, in the form of a newly- issued convertible bond. See Press Release, Sprint Nextel Cop, Sprint Announces Closing of $3.1 Billion Convertible Bond (Oct. 22,2012) available at http://newsroom.swint.com/article displav.cfm?article id=2436&view id=3856 (reporting that Sprint announced the closing of a convertible bond sale to Starburst 11, pursuant to which Starburst II agreed to purchase from Sprint a bond in the principal amount of $3.1 billion). Subject to all applicable regulatory approvals and subject to the provisions of the bond purchase agreement, the bond is convertible into an aggregate of 590,476,190 shares of Sprint common stock, If not earlier converted, principal and any accrued but unpaid interest under the bond will be due and payable on October 15,2019. See id.

6 shares of Starburst I1 and existing Sprint shareholders owning the remaining shares of S tarburst

11.” Starburst I1 will own 100 percent of the stock of Sprint and its subsidiaries.I2

This change in ultimate control does not involve a transfer of operating authority, assets,

or customers in West Virginia or elsewhere. Sprint and its subsidiaries, the Sprint West Virginia

Operating Entities, will continue to hold all of the authorizations that they hold prior to the

transaction. The current customers of the Sprint West Virginia Operating Entities will remain

customers of the Sprint West Virginia Operating Entities following the proposed transaction.

Sprint’s current Chief Executive Officer (“CEO”), Daniel Hesse, will be the CEO of Starburst 11,

which will be renamed Sprint Corporation.13 Accordingly, the proposed transaction will be

seamless to customers. Any future changes to the rates, terms, and conditions of service will be

undertaken pursuant to the customers’ contracts and applicable law.

The parties intend to consummate the transaction as promptly as possible after the

necessary FCC and other federal and state regulatory approvals have been received, Sprint’s

shareholders have approved the transaction, and other preconditions have been met.

PUBLIC INTEREST CONSIDERATIONS

The proposed transaction will not adversely affect the public in this State, will further the public interest, convenience and necessity and will not harm competition in the wireless marketplace. Because neither Starburst I1 nor SoftBank have attributable interests in any U.S. wireless carriers or compete with Sprint wireline telecommunications services, the proposed

I1 Under terms of the merger agreement, Starburst I will hold 69.642 percent of Starburst II’s common stock, and Sprint’s current shareholders will hold the remaining 30.358 percent of Starburst II’s common stock. Upon exercise of the warrant, SoftBank would own approximately 70 percent of Starburst II.

’* As a result of the transaction, SoftBank, through Starburst I, will hold an indirect ownership interest in approximately 70 percent of the stock of Starburst II, giving SoftBank indirect control over Sprint.

13 Six of Starburst II’s ten directors will be designated by SoftBank at the time the merger becomes effective. The remaining four directors will consist of the CEO and three other current dnectors of Sprint.

7 transaction poses no risk of competitive harm. To the contrary, the transaction will greatly

stimulate competition and innovation, and offers the potential to transform the

telecommunications marketplace in West Virginia and throughout the United States by creating a

more vibrant national rival to compete with today’s two predominant providers, Verizon and

AT&T.

The proposed SoftBank/Sprint transaction will make Sprint a more effective competitor

to Verizon and AT&T, in part by providing Sprint the financial resources needed to accelerate

and expand its broadband deployment in West Virginia and other parts of the country. The

transaction is designed to enable Sprint to take advantage of an $8 billion capital infusion, scale

efficiencies, and SoftBank’s expertise and resources as a leading mobile Internet company to

provide better, more innovative broadband services to consumers throughout the United States.

Sprint’s wireline operations will benefit from the improved balance sheet that will result from the

capital infusion from SoftBank. This stronger financial foundation will allow Sprint to increase

its network investment, accelerate its broadband deployment, and improve its coverage. The

greater financial resources also can be used by Sprint to offer a wider range of devices and

services to West Virginia consumer^.'^ West Virginia consumers should benefit from faster download speeds and technology and service innovation. The resulting greater competition and innovation can, in turn, stimulate economic growth and promote job creation.

11. CONCLUSION

14 After the transaction, SoftBank’s wireless holdings in Japan and the U.S. will serve nearly 92 million subscribers. This increased scale will enable the new Sprint to reduce equipment and handset costs through higher volume purchases. SoftBank will also provide Sprint with the scale to be a more attractive partner for handset manufacturers and application developers, stimulating innovation that will greatly benefit West Virginia consumers. In addition, with SoftBank’s expertise and resources, Sprint can develop a range of new on-demand content, programming, and services for U.S. consumers.

8 In conclusion and for the reasons stated above, Joint Petitioners request that the

Commission approve the proposed transaction as the terms and conditions of this Transaction are reasonable, neither party is given undue advantage over the other, and this Transaction will not adversely affect the public in this State. W.Va. Code Q 24-2-12. Accordingly, Sprint, on behalf of the Sprint West Virginia Operating Entities and Starburst 11, respectfully requests Commission approval of the Joint Petition.

WHEREFORE, Joint Petitioners respectfully pray:

a) that the Commission approve this Joint Application;

b) that, to the extent required by law, the Commission enter an Order granting its prior consent to the transaction detailed herein pursuant to West Virginia Code Q 24-2-12;

c) that the Commission waive public notice and hearing on this Joint Petition and any other formal filing requirements; and

d) that the Commission grant such other and further relief as the Commission deems just and appropriate. +i Respectfully submitted this zpfd day of November 2012.

By Counsel

David B. Hanna, Esq. (WV Bar # 8813) P.O. Box 3967 Charleston, WV 25339

Susan Berlin 3065 Akers Mill Rd SE Atlanta, Georgia 30339

Counsel for Sprint

9 Michael Pryor J.G. Harrington DOW LOHNES PLLC 1200 New Hampshire Ave., NW Suite 800 Washington, D.C. 20036 (202) 776-2000 MPryor @ dowlohnes.com JHarrington @ dowlohnes .com

Counsel for Starburst 11, Inc.

10 Nextel Finance

Nextel West Corp.

ommunlcations

ommunications

Company

Note: The entities on this page are either directly or indirectly owned by Sprint Nextel Corporation and are illustrated at a high level for the purposes of this filing. All ownership percentages and subsidiaries can be found at httrJ://www.sec.aov/Archives/edaar/data/lO (TzG&-) (-Ti&--) (--izG&-)

22 49% 22.49% 22.i9%

100% 100% 100% 1 I I

Public Shareholders Receive Cash and/or Stock in Starburst 11, Inc. 100% 100% 70% Ii’ lL I

I 100% 100% 100% 1 .LII .L L

Sprint Nextel Sprint Nextel Starburst 111, Inc. Carporation Starburst 111, Inc. Corporation

Merges with Sprint Nextel Corporation VERIFICATION

STATE OF MASSACHUSETTS

COUNTY OF MIDDLESEX, To-wit:

Ronald D. Fisher President of Starburst fl, Inc., being duly sworn, says that the facts and allegations therein contained in the foregoing Petition are true, except so far as they are therein stated to be on information, and that so far as they are therein stated to be on information, he believes them to be true.

I Ronald D. Fisher

Taken, sworn to and subscribed before me this 21Yhday of November 2012.

/ My commission expires on the \ ip day of 3 -\A& ,zo\s

NOTARY PUBLICO VERIFICATION

STATE OF KANSAS § ss COUNTY OF JOHNSON §

John W. Chapman, Vice President, Legal and Assistant Secretary for Sprint

Nextel Corporation and each of its affiliates and subsidiaries, being duly sworn, says that the facts and allegations therein contained in the foregoing Petition are true, except so far as they are therein stated to be on information, and that so far as they are therein stated to be on information, he believes them to be true.

Taken, sworn to and subscribed before me this d LB day of November 2012.