##### Table of Contents









UNITED STATES SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549


Form 10-Q


|           |  |                                                                                             
|---------- |  | --------------------------------------------------------------------------------------------
|(Mark One) |  |                                                                                             
|þ          |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934 
|          
|           |  | For the quarterly period ended March 31, 2006                                               
|          
|OR        
|          
|o          |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
|          
|           |  | For the transition period
    from          to                                              

Commission file number: 000-29633


NEXTEL PARTNERS, INC.


(Exact name of registrant as specified in its charter)


|                                                                   |  |                                         
|------------------------------------------------------------------ |  | ----------------------------------------
|Delaware                                                           |  | 91-1930918                              
|(State or other jurisdiction of
    incorporation or organization) |  | (I.R.S. Employer
    Identification No.)

4500 Carillon Point


Kirkland, Washington 98033


(425) 576-3600


(Address of principal executive offices, zip code and
registrants telephone number, including area code)


þ o


12b-2


þ o o


12b-2 o þ




|                           |  |                                
|-------------------------- |  | -------------------------------
|Outstanding Title of Class |  | Number of Shares on May 2, 2006
|                           |  |                                
|Class A Common Stock       |  | 209,673,647 shares             
|Class B Common Stock       |  | 84,632,604 shares              









---



##### 










NEXTEL PARTNERS, INC.


FORM 10-Q


TABLE OF CONTENTS


|                                   |  |                                                                                                |    |          |    | 
|---------------------------------- |  | ---------------------------------------------------------------------------------------------- | -- | -------- | -- | 
|                                   |  |                                                                                                |    | Page No. |   
|                                   |  |                                                                                                |    |          |   
|PART I  FINANCIAL
    INFORMATION
|Item 1.                            |  | Financial Statements                                                                           |    |          | 3  | 
|                                   |  | Consolidated Condensed Balance Sheets As of
    March 31, 2006 and December 31, 2005           |    |          | 3  | 
|                                   |  | Consolidated Condensed Statements of
    Operations Three months ended March 31, 2006 and 2005 |    |          | 4  | 
|                                   |  | Consolidated Condensed Statements of Cash
    Flows Three months ended March 31, 2006 and 2005 |    |          | 5  | 
|                                   |  | Notes to Consolidated Condensed Financial
    Statements                                       |    |          | 6  | 
|Item 2.                            |  | Managements Discussion and Analysis
    of Financial Condition and Results of Operations      |    |          | 25 | 
|Item 3.                            |  | Quantitative and Qualitative Disclosures
    about Market Risk                                 |    |          | 40 | 
|Item 4.                            |  | Controls and Procedures                                                                        |    |          | 41 | 
|                                  
|PART II  OTHER
    INFORMATION   
|Item 1.                            |  | Legal Proceedings                                                                              |    |          | 41 | 
|Item 1A.                           |  | Risk Factors                                                                                   |    |          | 42 | 
|Item 6.                            |  | Exhibits                                                                                       |    |          | 42 | 
|Signatures                         |  |                                                                                                | 43 |         
|EXHIBIT 31.1                      
|EXHIBIT 31.2                      
|EXHIBIT 32.1                      
|EXHIBIT 32.2                      



2



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##### Table of Contents






PART I  FINANCIAL INFORMATION







|        |                     
|------- | --------------------
|Item 1. | Financial Statements

NEXTEL PARTNERS, INC. AND SUBSIDIARIES





Consolidated Condensed Balance Sheets


|                                           |                                                                                                                                                                                            |                                    |           |           |              |   |           |           |           | 
|------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ---------------------------------- | --------- | --------- | ------------ | - | --------- | --------- | --------- | 
|                                           |                                                                                                                                                                                            | March 31,                          |           |           | December 31, |  
|                                           |                                                                                                                                                                                            | 2006                               |           |           | 2005         |  
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|                                           |                                                                                                                                                                                            | (Dollars in thousands,             |          
|                                           |                                                                                                                                                                                            | except per share amounts)          |          
|                                           |                                                                                                                                                                                            | (Unaudited)                        |          
|ASSETS                                    
|CURRENT ASSETS:                            |                                                                                                                                                                                            |                                    |           |           |              |   |           |          
|                                           | Cash and cash equivalents                                                                                                                                                                  |                                    | $         | 195,539   |              |   | $         | 150,403   |          
|                                           | Short-term investments                                                                                                                                                                     |                                    |           | 15,199    |              |   |           | 14,624    |          
|                                           | Accounts and notes receivable, net of allowance $27,983 and
    $27,267, respectively                                                                                                      |                                    |           | 263,620   |              |   |           | 265,720   |          
|                                           | Subscriber equipment inventory                                                                                                                                                             |                                    |           | 98,881    |              |   |           | 98,003    |          
|                                           | Deferred current income taxes                                                                                                                                                              |                                    |           | 173,750   |              |   |           | 78,027    |          
|                                           | Prepaid expenses                                                                                                                                                                           |                                    |           | 25,571    |              |   |           | 18,560    |          
|                                           | Other current assets                                                                                                                                                                       |                                    |           | 7,318     |              |   |           | 19,529    |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|Total current assets                       |                                                                                                                                                                                            |                                    | 779,878   |           |              |   | 644,866   |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|PROPERTY, PLANT AND EQUIPMENT, at cost     |                                                                                                                                                                                            |                                    | 1,817,690 |           |              |   | 1,744,633 |          
|                                           | Less  accumulated depreciation and amortization                                                                                                                                           |                                    |           | (709,771  | )            |   |           | (665,583  | )        
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|                                           |                                                                                                                                                                                            | Property, plant and equipment, net |           |           | 1,107,919    |   |           |           | 1,079,050 | 
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|OTHER NON-CURRENT ASSETS:                  |                                                                                                                                                                                            |                                    |           |           |              |   |           |          
|                                           | FCC licenses, net of accumulated amortization of $8,744                                                                                                                                    |                                    |           | 377,893   |              |   |           | 376,254   |          
|                                           | Deferred non-current income taxes                                                                                                                                                          |                                    |           | 40,399    |              |   |           | 181,252   |          
|                                           | Debt issuance costs and other, net of accumulated amortization
    of $8,089 and $7,575, respectively                                                                                      |                                    |           | 9,151     |              |   |           | 10,909    |          
|                                           | Goodwill                                                                                                                                                                                   |                                    |           | 2,199     |              |   |           | 1,514     |          
|                                           | Other intangible assets, net of accumulated amortization of $35
    and $22, respectively                                                                                                  |                                    |           | 70        |              |   |           | 83        |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|Total non-current assets                   |                                                                                                                                                                                            |                                    | 429,712   |           |              |   | 570,012   |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|TOTAL ASSETS                               |                                                                                                                                                                                            | $                                  | 2,317,509 |           |              | $ | 2,293,928 |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|                                          
|LIABILITIES AND STOCKHOLDERS EQUITY      
|CURRENT LIABILITIES:                       |                                                                                                                                                                                            |                                    |           |           |              |   |           |          
|                                           | Accounts payable                                                                                                                                                                           |                                    | $         | 77,491    |              |   | $         | 84,024    |          
|                                           | Accrued expenses and other current liabilities                                                                                                                                             |                                    |           | 111,085   |              |   |           | 117,446   |          
|                                           | Due to Nextel WIP                                                                                                                                                                          |                                    |           | 8,521     |              |   |           | 6,962     |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|Total current liabilities                  |                                                                                                                                                                                            |                                    | 197,097   |           |              |   | 208,432   |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|LONG-TERM OBLIGATIONS:                     |                                                                                                                                                                                            |                                    |           |           |              |   |           |          
|                                           | Long-term debt                                                                                                                                                                             |                                    |           | 1,101,396 |              |   |           | 1,226,608 |          
|                                           | Deferred income taxes                                                                                                                                                                      |                                    |           | 149       |              |   |           |          |          
|                                           | Other long-term liabilities                                                                                                                                                                |                                    |           | 44,108    |              |   |           | 39,691    |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|Total long-term obligations                |                                                                                                                                                                                            |                                    | 1,145,653 |           |              |   | 1,266,299 |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|TOTAL LIABILITIES                          |                                                                                                                                                                                            |                                    | 1,342,750 |           |              |   | 1,474,731 |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|COMMITMENTS AND CONTINGENCIES (See Note 7) |                                                                                                                                                                                            |                                    |           |           |              |   |           |          
|STOCKHOLDERS EQUITY:                      |                                                                                                                                                                                            |                                    |           |           |              |   |           |          
|                                           | Preferred stock, no par value, 100,000,000 shares
    authorized, no shares issued and outstanding                                                                                         |                                    |           |          |              |   |           |          |          
|                                           | Series B Preferred stock, par value $.001 per share,
    13,110,000 shares authorized, no shares outstanding                                                                               |                                    |           |          |              |   |           |          |          
|                                           | Common stock, Class A, par value $.001 per share,
    500,000,000 shares authorized, 209,107,039 and
    200,072,729 shares, respectively, issued and outstanding,
    and paid-in capital |                                    |           | 1,280,554 |              |   |           | 1,190,586 |          
|                                           | Common stock, Class B, par value $.001 per share
    convertible, 600,000,000 shares authorized,
    84,632,604 shares, issued and outstanding, and paid-in
    capital                    |                                    |           | 172,697   |              |   |           | 172,697   |          
|                                           | Accumulated deficit                                                                                                                                                                        |                                    |           | (479,426  | )            |   |           | (545,454  | )        
|                                           | Deferred compensation                                                                                                                                                                      |                                    |           |          |              |   |           | (64       | )        
|                                           | Accumulated other comprehensive income                                                                                                                                                     |                                    |           | 934       |              |   |           | 1,432     |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|Total stockholders equity                 |                                                                                                                                                                                            |                                    | 974,759   |           |              |   | 819,197   |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  
|TOTAL LIABILITIES AND STOCKHOLDERS EQUITY |                                                                                                                                                                                            | $                                  | 2,317,509 |           |              | $ | 2,293,928 |          
|                                           |                                                                                                                                                                                            |                                    |           |           |              |  



3



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NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Consolidated Condensed Statements of Operations


|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |   |        |             |         | 
|-------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------- | ------- | ----------- | ------- | - | ------ | ----------- | ------- | 
|                                                                                 |                                                                                                                                                                                           | For the Three Months Ended        |        
|                                                                                 |                                                                                                                                                                                           | March 31,                         |        
|                                                                                 |                                                                                                                                                                                           |                                   |        
|                                                                                 |                                                                                                                                                                                           | 2006                              |         |             | 2005    |  
|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |  
|                                                                                 |                                                                                                                                                                                           | (Dollars in thousands, except per |        
|                                                                                 |                                                                                                                                                                                           | share amounts)                    |        
|                                                                                 |                                                                                                                                                                                           | (Unaudited)                       |        
|REVENUES:                                                                        |                                                                                                                                                                                           |                                   |         |             |         |   |        |            
|                                                                                 | Service revenues (earned from Nextel WIP $58,758 and $44,824,
    respectively)                                                                                                           |                                   | $       | 468,011     |         |   | $      | 378,858     |        
|                                                                                 | Equipment revenues                                                                                                                                                                        |                                   |         | 31,158      |         |   |        | 25,226      |        
|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |  
|                                                                                 |                                                                                                                                                                                           | Total revenues                    |         |             | 499,169 |   |        |             | 404,084 | 
|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |  
|OPERATING EXPENSES:                                                              |                                                                                                                                                                                           |                                   |         |             |         |   |        |            
|                                                                                 | Cost of service revenues (excludes depreciation of $37,138 and
    $32,499, respectively) (incurred from Nextel WIP $35,844 and
    $32,911; and Sprint Nextel $885 and $0, respectively) |                                   |         | 113,918     |         |   |        | 98,626      |        
|                                                                                 | Cost of equipment revenues                                                                                                                                                                |                                   |         | 44,650      |         |   |        | 44,798      |        
|                                                                                 | Selling, general and administrative (incurred from Nextel WIP
    $10,342 and $10,613 and Sprint Nextel $282 and $0, respectively)                                                        |                                   |         | 162,649     |         |   |        | 138,299     |        
|                                                                                 | Depreciation and amortization                                                                                                                                                             |                                   |         | 44,586      |         |   |        | 40,753      |        
|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |  
|                                                                                 |                                                                                                                                                                                           | Total operating expenses          |         |             | 365,803 |   |        |             | 322,476 | 
|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |  
|INCOME FROM OPERATIONS                                                           |                                                                                                                                                                                           |                                   | 133,366 |             |         |   | 81,608 |            
|                                                                                 | Interest expense, net of capitalized interest                                                                                                                                             |                                   |         | (18,029     | )       |   |        | (25,867     | )      
|                                                                                 | Interest income                                                                                                                                                                           |                                   |         | 2,474       |         |   |        | 2,643       |        
|                                                                                 | Loss on early retirement of debt                                                                                                                                                          |                                   |         | (81         | )       |   |        |            |        
|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |  
|INCOME BEFORE INCOME TAX PROVISION                                               |                                                                                                                                                                                           |                                   | 117,730 |             |         |   | 58,384 |            
|                                                                                 | Income tax provision                                                                                                                                                                      |                                   |         | (51,702     | )       |   |        | (1,852      | )      
|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |  
|NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS                                   |                                                                                                                                                                                           | $                                 | 66,028  |             |         | $ | 56,532 |            
|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |  
|NET INCOME PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS, BASIC
    AND DILUTED: |                                                                                                                                                                                           |                                   |         |             |         |   |        |            
|                                                                                 | Basic                                                                                                                                                                                     |                                   | $       | 0.23        |         |   | $      | 0.21        |        
|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |  
|                                                                                 | Diluted                                                                                                                                                                                   |                                   | $       | 0.21        |         |   | $      | 0.19        |        
|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |  
|Weighted average number of shares outstanding                                    |                                                                                                                                                                                           |                                   |         |             |         |   |        |            
|                                                                                 | Basic                                                                                                                                                                                     |                                   |         | 290,006,980 |         |   |        | 267,091,076 |        
|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |  
|                                                                                 | Diluted                                                                                                                                                                                   |                                   |         | 308,890,560 |         |   |        | 308,335,492 |        
|                                                                                 |                                                                                                                                                                                           |                                   |         |             |         |  



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NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Consolidated Condensed Statements of Cash Flows


|                                               |                                                                               |                                                                  |                                    |         |        |         |         |         |         |         |  
|---------------------------------------------- | ----------------------------------------------------------------------------- | ---------------------------------------------------------------- | ---------------------------------- | ------- | ------ | ------- | ------- | ------- | ------- | ------- | -
|                                               |                                                                               | For the Three Months                                             |                                   
|                                               |                                                                               | Ended March 31,                                                  |                                   
|                                               |                                                                               |                                                                  |                                   
|                                               |                                                                               | 2006                                                             |                                    |         | 2005   |        
|                                               |                                                                               |                                                                  |                                    |         |        |        
|                                               |                                                                               | (Dollars in thousands)                                           |                                   
|                                               |                                                                               | (Unaudited)                                                      |                                   
|CASH FLOWS FROM OPERATING ACTIVITIES:          |                                                                               |                                                                  |                                    |         |        |         |         |        
|                                               | Net income                                                                    |                                                                  | $                                  | 66,028  |        |         | $       | 56,532  |        
|                                               | Adjustments to reconcile net income to net cash from operating
    activities |                                                                  |                                    |         |        |         |         |         |        
|                                               | Deferred income tax provision                                                 |                                                                  |                                    | 45,594  |        |         |         | 762     |        
|                                               | Depreciation and amortization                                                 |                                                                  |                                    | 44,586  |        |         |         | 40,753  |        
|                                               | Amortization of debt issuance costs                                           |                                                                  |                                    | 514     |        |         |         | 878     |        
|                                               | Bond discount amortization                                                    |                                                                  |                                    | 13      |        |         |         | 269     |        
|                                               | Loss on early retirement of debt                                              |                                                                  |                                    | 81      |        |         |         |        |        
|                                               | Stock based compensation                                                      |                                                                  |                                    | 4,878   |        |         |         | 127     |        
|                                               | Other, net                                                                    |                                                                  |                                    | 145     |        |         |         | (433    | )      
|                                               | Changes in current assets and liabilities:                                    |                                                                  |                                    |         |        |         |         |         |        
|                                               |                                                                               | Accounts and notes receivable, net                               |                                    |         | 2,100  |         |         |         | (16,839 | )      
|                                               |                                                                               | Subscriber equipment inventory                                   |                                    |         | (878   | )       |         |         | 19,385  |        
|                                               |                                                                               | Other current and long-term assets                               |                                    |         | 6,622  |         |         |         | (1,052  | )      
|                                               |                                                                               | Accounts payable, accrued expenses and other current liabilities |                                    |         | (7,742 | )       |         |         | 14,952  |        
|                                               |                                                                               | Operating advances due to (from) Nextel WIP                      |                                    |         | (1,539 | )       |         |         | 1,880   |        
|                                               |                                                                               |                                                                  |                                    |         |        |        
|                                               |                                                                               |                                                                  | Net cash from operating activities |         |        | 160,402 |         |         |         | 117,214 |  
|                                               |                                                                               |                                                                  |                                    |         |        |        
|CASH FLOWS FROM INVESTING ACTIVITIES:          |                                                                               |                                                                  |                                    |         |        |         |         |        
|                                               | Capital expenditures                                                          |                                                                  |                                    | (75,735 | )      |         |         | (69,107 | )      
|                                               | FCC licenses                                                                  |                                                                  |                                    | (1,639  | )      |         |         | (60     | )      
|                                               | Proceeds from maturities of short-term investments                            |                                                                  |                                    | 10,465  |        |         |         | 50,430  |        
|                                               | Proceeds from sales of short-term investments                                 |                                                                  |                                    |        |        |         |         | 19,659  |        
|                                               | Purchases of short-term investments                                           |                                                                  |                                    | (11,014 | )      |         |         | (38,203 | )      
|                                               | Other                                                                         |                                                                  |                                    | (772    | )      |         |         |        |        
|                                               |                                                                               |                                                                  |                                    |         |        |        
|                                               |                                                                               |                                                                  | Net cash from investing activities |         |        | (78,695 | )       |         |         | (37,281 | )
|                                               |                                                                               |                                                                  |                                    |         |        |        
|CASH FLOWS FROM FINANCING ACTIVITIES:          |                                                                               |                                                                  |                                    |         |        |         |         |        
|                                               | Stock options exercised                                                       |                                                                  |                                    | 12,114  |        |         |         | 20,968  |        
|                                               | Proceeds from stock issued for employee stock purchase plan                   |                                                                  |                                    |        |        |         |         | 630     |        
|                                               | Proceeds from sale lease-back transactions                                    |                                                                  |                                    | 2,256   |        |         |         | 405     |        
|                                               | Debt repayments                                                               |                                                                  |                                    | (50,000 | )      |         |         |        |        
|                                               | Capital lease payments                                                        |                                                                  |                                    | (923    | )      |         |         | (846    | )      
|                                               | Other                                                                         |                                                                  |                                    | (18     | )      |         |         | (4      | )      
|                                               |                                                                               |                                                                  |                                    |         |        |        
|                                               |                                                                               |                                                                  | Net cash from financing activities |         |        | (36,571 | )       |         |         | 21,153  |  
|                                               |                                                                               |                                                                  |                                    |         |        |        
|NET INCREASE IN CASH AND CASH EQUIVALENTS      |                                                                               |                                                                  | 45,136                             |         |        |         | 101,086 |        
|CASH AND CASH EQUIVALENTS, beginning of period |                                                                               |                                                                  | 150,403                            |         |        |         | 147,484 |        
|                                               |                                                                               |                                                                  |                                    |         |        |        
|CASH AND CASH EQUIVALENTS, end of period       |                                                                               | $                                                                | 195,539                            |         |        | $       | 248,570 |        
|                                               |                                                                               |                                                                  |                                    |         |        |        
|SUPPLEMENTAL DISCLOSURES                       |                                                                               |                                                                  |                                    |         |        |         |         |        
|                                               | Cash paid for income taxes                                                    |                                                                  | $                                  | 33      |        |         | $       |        |        
|                                               |                                                                               |                                                                  |                                    |         |        |        
|                                               | Retirement of long-term debt with common stock                                |                                                                  | $                                  | 74,218  |        |         | $       | 19      |        
|                                               |                                                                               |                                                                  |                                    |         |        |        
|                                               | Cash paid for interest, net of capitalized amount                             |                                                                  | $                                  | 26,515  |        |         | $       | 29,117  |        
|                                               |                                                                               |                                                                  |                                    |         |        |        



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NEXTEL PARTNERS, INC. AND SUBSIDIARIES





Notes to Consolidated Condensed Financial Statements


March 31, 2006


(unaudited)




|   |                      
|-- | ---------------------
|1. | BASIS OF PRESENTATION

10-K 10-Q






|   |           
|-- | ----------
|2. | OPERATIONS



| |                        
| | -----------------------
| | Description of Business







6



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NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)




|   |                                
|-- | -------------------------------
|3. | SIGNIFICANT ACCOUNTING POLICIES



| |                      
| | ---------------------
| | Concentration of Risk











| |                 
| | ----------------
| | Use of Estimates





| |                            
| | ---------------------------
| | Principles of Consolidation





| |                                                                                
| | -------------------------------------------------------------------------------
| | Net Income per Share Attributable to Common Stockholders,
    Basic and Diluted

Computation of
Earnings Per Share,


7



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NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)




|                                                                                   |                                                     |                                     |             |            |      |   |             |            |  
|---------------------------------------------------------------------------------- | --------------------------------------------------- | ----------------------------------- | ----------- | ---------- | ---- | - | ----------- | ---------- | -
|                                                                                   |                                                     | For the Three Months Ended          |            
|                                                                                   |                                                     | March 31,                           |            
|                                                                                   |                                                     |                                     |            
|                                                                                   |                                                     | 2006                                |             |            | 2005 |  
|                                                                                   |                                                     |                                     |             |            |      |  
|                                                                                   |                                                     | (In thousands, except share and per |            
|                                                                                   |                                                     | share amounts)                      |            
|Income attributable to common stockholders (numerator for basic)                   |                                                     | $                                   | 66,028      |            |      | $ | 56,532      |           
|                                                                                   | Effect of dilutive securities:                      |                                     |             |            |      |   |             |            |  
|                                                                                   | Convertible Senior Notes                            |                                     | $           | 323        |      |   | $           | 1,125      |  
|                                                                                   |                                                     |                                     |             |            |      |  
|Adjusted Income attributable to common stockholders (numerator
    for diluted)    |                                                     | $                                   | 66,351      |            |      | $ | 57,657      |           
|                                                                                   |                                                     |                                     |             |            |      |  
|Gross weighted average common shares outstanding                                   |                                                     |                                     | 290,044,480 |            |      |   | 267,193,826 |           
|                                                                                   | Less: Weighted average shares subject to repurchase |                                     |             | (37,500    | )    |   |             | (102,750   | )
|                                                                                   |                                                     |                                     |             |            |      |  
|Weighted average common shares outstanding  basic
    (denominator for basic)     |                                                     |                                     | 290,006,980 |            |      |   | 267,091,076 |           
|                                                                                   | Effect of dilutive securities:                      |                                     |             |            |      |   |             |            |  
|                                                                                   | Convertible Senior Notes                            |                                     |             | 14,622,354 |      |   |             | 32,871,975 |  
|                                                                                   | Stock options                                       |                                     |             | 4,225,570  |      |   |             | 8,284,331  |  
|                                                                                   | Restricted stock (unvested)                         |                                     |             | 35,656     |      |   |             | 88,110     |  
|                                                                                   |                                                     |                                     |             |            |      |  
|Weighted average common shares outstanding  diluted
    (denominator for diluted) |                                                     |                                     | 308,890,560 |            |      |   | 308,335,492 |           
|                                                                                   |                                                     |                                     |             |            |      |  
|Net income per share attributable to common stockholders, basic                    |                                                     | $                                   | 0.23        |            |      | $ | 0.21        |           
|                                                                                   |                                                     |                                     |             |            |      |  
|Net income per share attributable to common stockholders, diluted                  |                                                     | $                                   | 0.21        |            |      | $ | 0.19        |           
|                                                                                   |                                                     |                                     |             |            |      |  





| |                          
| | -------------------------
| | Cash and Cash Equivalents





| |                       
| | ----------------------
| | Short-Term Investments

held-to


8



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)




| |                            
| | ---------------------------
| | Sale-Leaseback Transactions





| |       
| | ------
| | Leases





| |                               
| | ------------------------------
| | Intangible Assets and Goodwill

Goodwill and Other Intangible
Assets,


10-year


Unit of
Accounting for Testing Impairment of Indefinite-Lived Intangible
Assets.


24-month


9



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)




| |             
| | ------------
| | Income Taxes



|                           |         |                 |        |        |      |   |       |       | 
|-------------------------- | ------- | --------------- | ------ | ------ | ---- | - | ----- | ----- | 
|                           |         | For the         |       
|                           |         | Three Months    |       
|                           |         | Ended March 31, |       
|                           |         |                 |       
|                           |         | 2006            |        |        | 2005 |  
|                           |         |                 |        |        |      |  
|                           |         | (In thousands)  |       
|Current Tax Provision:     |         |                 |        |        |      |   |       |      
|                           | Federal |                 | $      | 2,935  |      |   | $     | 1,070 | 
|                           | State   |                 |        | 3,173  |      |   |       | 20    | 
|                           |         |                 |        |        |      |  
|                           | Total   |                 |        | 6,108  |      |   |       | 1,090 | 
|Deferred Tax Provision:    |         |                 |        |        |      |   |       |      
|                           | Federal |                 |        | 41,337 |      |   |       | 504   | 
|                           | State   |                 |        | 4,257  |      |   |       | 258   | 
|                           |         |                 |        |        |      |  
|                           | Total   |                 |        | 45,594 |      |   |       | 762   | 
|                           |         |                 |        |        |      |  
|Total Income Tax Provision |         | $               | 51,702 |        |      | $ | 1,852 |      
|                           |         |                 |        |        |      |  

Accounting for Income Taxes.




| |                              
| | -----------------------------
| | Interest Rate Risk Management



Accounting for Derivative
Instruments and Hedging Activities,


10



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)




|                                             |  |                |       |  
|-------------------------------------------- |  | -------------- | ----- | -
|Hedging Instruments                          |  | (In thousands) |      
|                                             |  |                |      
|Fair value of assets as of December 31, 2005 |  | $              | 1,671 |  
|Cancellation of $100 million of swaps        |  |                | (815  | )
|Change in fair value  interest rate changes |  |                | (167  | )
|                                             |  |                |      
|Fair value of assets as of March 31, 2006    |  | $              | 689   |  
|                                             |  |                |      



| |                                  
| | ---------------------------------
| | Non-Cash Flow Hedging Instruments







| |                              
| | -----------------------------
| | Cash Flow Hedging Instruments





| |                    
| | -------------------
| | Revenue Recognition





00-21 Accounting for Revenue Arrangements with Multiple
Deliverables,


11



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)


Revenue Recognition in
Financial Statements, 00-21.


00-21


|                                                              |  |                           |         |  |      |   |         | 
|------------------------------------------------------------- |  | ------------------------- | ------- |  | ---- | - | ------- | 
|                                                              |  | For the Three Months      |        
|                                                              |  | Ended March 31,           |        
|                                                              |  |                           |        
|                                                              |  | 2006                      |         |  | 2005 |  
|                                                              |  |                           |         |  |      |  
|                                                              |  | (In thousands, except per |        
|                                                              |  | share amounts)            |        
|Service revenues                                              |  | $                         | 467,827 |  |      | $ | 378,155 | 
|                                                              |  |                           |         |  |      |  
|Equipment revenues                                            |  | $                         | 30,028  |  |      | $ | 21,383  | 
|                                                              |  |                           |         |  |      |  
|Cost of equipment revenues                                    |  | $                         | 43,336  |  |      | $ | 40,252  | 
|                                                              |  |                           |         |  |      |  
|Income attributable to common stockholders                    |  | $                         | 66,028  |  |      | $ | 56,532  | 
|                                                              |  |                           |         |  |      |  
|Income per share attributable to common stockholders, basic   |  | $                         | 0.23    |  |      | $ | 0.21    | 
|                                                              |  |                           |         |  |      |  
|Income per share attributable to common stockholders, diluted |  | $                         | 0.21    |  |      | $ | 0.19    | 
|                                                              |  |                           |         |  |      |  



| |                  
| | -----------------
| | Reclassifications





| |                  
| | -----------------
| | Long-Lived Assets

Accounting
for the Impairment or Disposal of Long-Lived Assets.


12



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)




| |                         
| | ------------------------
| | Stock-Based Compensation

Share Based Payment, Accounting for Stock-Based
Compensation, Accounting
for Stock Issued to Employees.




| |                                          
| | -----------------------------------------
| | Recently Issued Accounting Pronouncements

13-1, Accounting for Rental Costs Incurred during a
Construction Period, 13-1




|   |                         
|-- | ------------------------
|4. | STOCK-BASED COMPENSATION

Share Based Payment, Accounting for Stock-Based
Compensation, Accounting for Stock Issued to Employees. Share
Based Payment,




Accounting for Stock
Issued to Employees.


13



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)




1 3 1 4






|                                               |  |                                           |         |   |                  |   |         |                    |  |   |         |  
|---------------------------------------------- |  | ----------------------------------------- | ------- | - | ---------------- | - | ------- | ------------------ |  | - | ------- | -
|                                               |  | For the Three Months Ended March 31, 2006 |        
|                                               |  |                                           |        
|                                               |  | As Reported                               |         |   | Under APB No. 25 |   |         | Under SFAS No. 123 | 
|                                               |  |                                           |         |   |                  |   |         |                    | 
|                                               |  | (In thousands, except per share amounts)  |        
|Income from operations                         |  | $                                         | 133,366 |   |                  | $ | 138,184 |                    |  | $ | 133,080 |  
|Income before income tax provision             |  |                                           | 117,730 |   |                  |   | 122,548 |                    |  |   | 117,444 |  
|Net income attributable to common stockholders |  |                                           | 66,028  |   |                  |   | 70,785  |                    |  |   | 65,043  |  
|Cash flows from operating activities           |  |                                           | 160,402 |   |                  |   | 160,402 |                    |  |   | 160,402 |  
|Cash flows from financing activities           |  |                                           | (36,571 | ) |                  |   | (36,571 | )                  |  |   | (36,571 | )
|Basic earnings per share                       |  | $                                         | 0.23    |   |                  | $ | 0.24    |                    |  | $ | 0.22    |  
|Diluted earnings per share                     |  | $                                         | 0.21    |   |                  | $ | 0.23    |                    |  | $ | 0.21    |  

14



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)




|                                                                                                                    |  |                            |        |  
|------------------------------------------------------------------------------------------------------------------- |  | -------------------------- | ------ | -
|                                                                                                                    |  | For the Three Months Ended |       
|                                                                                                                    |  | March 31, 2005             |       
|                                                                                                                    |  |                            |       
|                                                                                                                    |  | (In thousands, except per  |       
|                                                                                                                    |  | share amounts)             |       
|Net income, as reported                                                                                             |  | $                          | 56,532 |  
|Add: stock-based employee compensation expense included in
    reported net income                                  |  |                            | 127    |  
|Deduct: total stock-based employee compensation expense
    determined under fair-value-based method for all awards |  |                            | (7,406 | )
|                                                                                                                    |  |                            |       
|As adjusted, net income                                                                                             |  | $                          | 49,253 |  
|                                                                                                                    |  |                            |       
|Basic income per share attributable to common stockholders:                                                         |  |                            |        |  
|As reported                                                                                                         |  | $                          | 0.21   |  
|                                                                                                                    |  |                            |       
|As adjusted                                                                                                         |  | $                          | 0.18   |  
|                                                                                                                    |  |                            |       
|Diluted income per share attributable to common stockholders:                                                       |  |                            |        |  
|As reported                                                                                                         |  | $                          | 0.19   |  
|                                                                                                                    |  |                            |       
|As adjusted                                                                                                         |  | $                          | 0.17   |  
|                                                                                                                    |  |                            |       



|                                                                                  |  |                 |       |  |      |   |     | 
|--------------------------------------------------------------------------------- |  | --------------- | ----- |  | ---- | - | --- | 
|                                                                                  |  | For the         |      
|                                                                                  |  | Three Months    |      
|                                                                                  |  | Ended March 31, |      
|                                                                                  |  |                 |      
|                                                                                  |  | 2006            |       |  | 2005 |  
|                                                                                  |  |                 |       |  |      |  
|                                                                                  |  | (In thousands)  |      
|Total stock-based compensation included in net income                             |  | $               | 4,878 |  |      | $ | 127 | 
|Income tax benefit related to stock-based compensation included
    in net income |  | $               | 1,893 |  |      | $ |    | 



|                              |  |           |            |          |                |            |          |                |                |  |                 |  |  |   |         | 
|----------------------------- |  | --------- | ---------- | -------- | -------------- | ---------- | -------- | -------------- | -------------- |  | --------------- |  |  | - | ------- | 
|                              |  |           |            | Weighted |                |            | Weighted |                |                | 
|                              |  | Number of |            |          | Average        |            |          | Average        |                |  | Aggregate       | 
|                              |  | Options   |            |          | Exercise Price |            |          | Remaining Life |                |  | Intrinsic Value | 
|                              |  |           |            |          |                |            |          |                |                |  |                 | 
|                              |  |           |            |          |                | (In years) |          |                | (In thousands) | 
|Outstanding December 31, 2005 |  |           | 17,543,175 |          |                | $          | 11.93    |                |                |  |                 |  |  |   |         | 
|Granted                       |  |           |           |          |                | $          | 0.00     |                |                |  |                 |  |  |   |         | 
|Exercised                     |  |           | (1,061,963 | )        |                | $          | 11.41    |                |                |  |                 |  |  |   |         | 
|Forfeitures                   |  |           | (123,925   | )        |                | $          | 15.24    |                |                |  |                 |  |  |   |         | 
|Cancelled                     |  |           | (1,512     | )        |                | $          | 11.77    |                |                |  |                 |  |  |   |         | 
|                              |  |           |            |          |                |            |          |                |                |  |                 | 
|Outstanding March 31, 2006    |  |           | 16,355,775 |          |                | $          | 11.95    |                |                |  | 6.95            |  |  | $ | 267,808 | 
|                              |  |           |            |          |                |            |          |                |                |  |                 | 
|Exercisable, March 31, 2006   |  |           | 10,435,486 |          |                | $          | 9.86     |                |                |  | 6.28            |  |  | $ | 192,695 | 
|                              |  |           |            |          |                |            |          |                |                |  |                 | 

15



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)




|                                                                       |  |                      |        |  |      |   |        | 
|---------------------------------------------------------------------- |  | -------------------- | ------ |  | ---- | - | ------ | 
|                                                                       |  | For the Three Months |       
|                                                                       |  | Ended March 31,      |       
|                                                                       |  |                      |       
|                                                                       |  | 2006                 |        |  | 2005 |  
|                                                                       |  |                      |        |  |      |  
|                                                                       |  | (In thousands)       |       
|Weighted average grant-date fair value of stock options
    granted(1) |  | $                    |       |  |      | $ | 7.64   | 
|Total intrinsic value of stock options exercised                       |  | $                    | 17,660 |  |      | $ | 21,153 | 






|    |                                                         
|--- | --------------------------------------------------------
|(1) | No stock options were granted during first quarter 2006.





|                                |  |                 |   |  |      |  |         | 
|------------------------------- |  | --------------- | - |  | ---- |  | ------- | 
|                                |  | For the         |  
|                                |  | Three Months    |  
|                                |  | Ended March 31, |  
|                                |  |                 |  
|                                |  | 2006(1)         |   |  | 2005 | 
|                                |  |                 |   |  |      | 
|Expected stock price volatility |  |                 |  |  |      |  | 43.0%   | 
|Risk-free interest rate         |  |                 |  |  |      |  | 3.7%    | 
|Expected life in years          |  |                 |  |  |      |  | 4 years | 
|Expected dividend yield         |  |                 |  |  |      |  | 0.00%   | 






|    |                                                         
|--- | --------------------------------------------------------
|(1) | No stock options were granted during first quarter 2006.





| |                 
| | ----------------
| | Restricted Stock

Accounting for Stock Appreciation Rights
and Other Variable Stock Option or Award Plans


|                                      |  |                   |        |                  |                 |   |      | 
|------------------------------------- |  | ----------------- | ------ | ---------------- | --------------- | - | ---- | 
|                                      |  |                   |        | Weighted Average |                
|                                      |  | Number of         |        |                  | Grant-Date Fair |  
|                                      |  | Restricted Shares |        |                  | Value           |  
|                                      |  |                   |        |                  |                 |  
|Unvested balance at December 31, 2005 |  |                   | 37,500 |                  |                 | $ | 8.64 | 
|Granted                               |  |                   |       |                  |                 |   |     | 
|Vested                                |  |                   |       |                  |                 |   |     | 
|Forfeited                             |  |                   |       |                  |                 |   |     | 
|                                      |  |                   |        |                  |                 |  
|Nonvested balance at March 31, 2006   |  |                   | 37,500 |                  |                 | $ | 8.64 | 
|                                      |  |                   |        |                  |                 |  

16



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)






|   |                       
|-- | ----------------------
|5. | PROPERTY AND EQUIPMENT

|                                                 |  |                |           |   |              |   |           |  
|------------------------------------------------ |  | -------------- | --------- | - | ------------ | - | --------- | -
|                                                 |  | As of          |          
|                                                 |  |                |          
|                                                 |  | March 31,      |           |   | December 31, |  
|                                                 |  | 2006           |           |   | 2005         |  
|                                                 |  |                |           |   |              |  
|                                                 |  | (In thousands) |          
|Equipment                                        |  | $              | 1,596,620 |   |              | $ | 1,546,814 |  
|Furniture, fixtures and software                 |  |                | 149,338   |   |              |   | 145,492   |  
|Building and improvements                        |  |                | 16,586    |   |              |   | 14,872    |  
|Less  accumulated depreciation and amortization |  |                | (709,771  | ) |              |   | (665,583  | )
|                                                 |  |                |           |   |              |  
|Subtotal                                         |  |                | 1,052,773 |   |              |   | 1,041,595 |  
|Construction in progress                         |  |                | 55,146    |   |              |   | 37,455    |  
|                                                 |  |                |           |   |              |  
|Total property and equipment                     |  | $              | 1,107,919 |   |              | $ | 1,079,050 |  
|                                                 |  |                |           |   |              |  



|   |                                      
|-- | -------------------------------------
|6. | NON-CURRENT PORTION OF LONG-TERM DEBT

|                                                                                                                                                                |  |                |           |  |              |   |           | 
|--------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------- | --------- |  | ------------ | - | --------- | 
|                                                                                                                                                                |  | As of          |          
|                                                                                                                                                                |  |                |          
|                                                                                                                                                                |  | March 31,      |           |  | December 31, |  
|                                                                                                                                                                |  | 2006           |           |  | 2005         |  
|                                                                                                                                                                |  |                |           |  |              |  
|                                                                                                                                                                |  | (In thousands) |          
|Bank Credit Facility  tranche D term loan,
    interest, at our option, calculated on Administrative
    Agents alternate base rate or reserve adjusted LIBOR |  | $              | 500,000   |  |              | $ | 550,000   | 
|81/8% Senior Notes due 2011, net of $0.4 million
    discount, interest payable semi-annually in cash and in arrears                                            |  |                | 474,656   |  |              |   | 474,643   | 
|11/2% Convertible Senior Notes due 2008, interest
    payable semi-annually in cash and in arrears                                                              |  |                | 114,092   |  |              |   | 188,310   | 
|Capital leases                                                                                                                                                  |  |                | 12,648    |  |              |   | 13,655    | 
|                                                                                                                                                                |  |                |           |  |              |  
|Total non-current portion of long-term debt                                                                                                                     |  | $              | 1,101,396 |  |              | $ | 1,226,608 | 
|                                                                                                                                                                |  |                |           |  |              |  



| |                     
| | --------------------
| | Bank Credit Facility



17



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NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)








| |                                
| | -------------------------------
| | 81/8% Senior
    Notes Due 2011

1 8 1 8 1 8


1 8 1 8 1 8


1 8 1 8 1 8




| |                                            
| | -------------------------------------------
| | 11/2% Convertible
    Senior Notes Due 2008

1 2 1 2 1 2 1 2 1 2


18



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)


1 2


1 2 1 2 1 2 1 2 1 2 1 2


1 2 1 2


1 2 1 2




|   |                              
|-- | -----------------------------
|7. | COMMITMENTS AND CONTINGENCIES



| |                  
| | -----------------
| | Legal Proceedings

et al


19



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)




et
al et
al et al 03-CA1065. et al et al et al


20



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NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)






| |   |                                                                                                                                                                                                                                                                                                                  
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | The changes that Nextel and Sprint had announced they were
    planning to make with respect to branding after the close of the
    Sprint-Nextel merger would violate the joint venture agreement
    if we could not use the same brand identity that Nextel used
    after the merger, i.e., the Sprint brand.
|
| |  | Other operational changes that we believed Nextel and Sprint
    planned to implement after the Sprint-Nextel merger (including,
    without limitation, changes with respect to marketing and
    national accounts) would violate the joint venture agreement.                                                 
|
| |  | The operations of the combined Sprint-Nextel could violate our
    exclusivity rights under the joint venture agreement.                                                                                                                                                                                         
|
| |  | Nextel and Nextel WIP had not complied with their obligation to
    permit us to participate in and contribute to discussions
    regarding branding and a variety of other operational matters.                                                                                                                 



1722-N.






21



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)




et al. et al et al






22



---



##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)






|   |                           
|-- | --------------------------
|8. | RELATED PARTY TRANSACTIONS



| |                            
| | ---------------------------
| | Nextel Operating Agreements









23



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##### Table of Contents



NEXTEL PARTNERS, INC. AND SUBSIDIARIES


Notes to Consolidated Condensed Financial
Statements  (Continued)




| |                      
| | ---------------------
| | Business Relationship





|   |                     
|-- | --------------------
|9. | COMPREHENSIVE INCOME

|                                                                                                                    |                                         |                |        |      |      |   |        |       | 
|------------------------------------------------------------------------------------------------------------------- | --------------------------------------- | -------------- | ------ | ---- | ---- | - | ------ | ----- | 
|                                                                                                                    |                                         | For the        |       
|                                                                                                                    |                                         | Three Months   |       
|                                                                                                                    |                                         | Ended March 31 |       
|                                                                                                                    |                                         |                |       
|                                                                                                                    |                                         | 2006           |        |      | 2005 |  
|                                                                                                                    |                                         |                |        |      |      |  
|                                                                                                                    |                                         | (In thousands) |       
|Net Income attributable to common stockholders (as reported on
    Consolidated Condensed Statements of Operations) |                                         | $              | 66,028 |      |      | $ | 56,532 |      
|                                                                                                                    | Unrealized gain/loss on investments     |                |        | 30   |      |   |        |      | 
|                                                                                                                    | Unrealized gain/loss on cash flow hedge |                |        | (528 | )    |   |        | 1,700 | 
|                                                                                                                    |                                         |                |        |      |      |  
|                                                                                                                    | Other comprehensive income              |                |        | (498 | )    |   |        | 1,700 | 
|Comprehensive Income, net of tax                                                                                    |                                         | $              | 65,530 |      |      | $ | 58,232 |      
|                                                                                                                    |                                         |                |        |      |      |  

24



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##### Table of Contents








|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|Item 2. | Managements Discussion and Analysis of Financial
    Condition and Results of Operations



10-K


10-Q


Overview


e-mail.






| |   |                                                                                                                                                                                                                                                                                                   
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | digital cellular voice, including advanced calling features such
    as speakerphone, conference calling, voicemail, call forwarding
    and additional line service;                                                                                                                             
|
| |  | Direct Connect service, the digital walkie-talkie service that
    allows customers to instantly connect with business associates,
    family and friends without placing a phone call;                                                                                                           
|
| |  | short messaging, the service that utilizes the Internet to keep
    customers connected to clients, colleagues and family with text,
    numeric and two-way messaging; and                                                                                                                       
|
| |  | Nextel Online services, which provide customers with
    Internet-ready handsets access to the World Wide Web and an
    organizations internal database, as well as web-based
    applications such as
    e-mail, address books,
    calendars and advanced Java enabled business applications.

25



---



##### Table of Contents





1 2








| |   |                                                                                                                                                                                                                                                                 
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Growing our subscriber base approximately 25% in a twelve-month
    period by adding approximately 418,800 net new customers to
    end the first quarter of 2006 at 2,120,600 subscribers as
    compared to 1,701,800 at the end of the first quarter of 2005.
|
| |  | Growing our service revenues approximately 24% to
    $468.0 million for the first quarter of 2006 compared to
    $378.9 million for the same period in 2005.                                                                                                  
|
| |  | Increasing Adjusted EBITDA 49% to $182.8 million for the
    three months ended March 31, 2006 compared to
    $122.5 million for the three months ended March 31,
    2005.                                                                                    
|
| |  | Generating $160.4 million net cash from operating
    activities during the first quarter of 2006 compared to
    $117.2 million during the first quarter of 2005.                                                                                              
|
| |  | Remaining one of the industry leaders in LRS with an LRS of
    $4,714 for the first quarter of 2006 compared to $4,786 for the
    first quarter of 2005.                                                                                                      





26



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SELECTED CONSOLIDATED FINANCIAL DATA (Unaudited)




|                                                         |                                                                                                                                                       |                           |         |         |      |   |         |         |  
|-------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------- | ------- | ------- | ---- | - | ------- | ------- | -
|                                                         |                                                                                                                                                       | For the Three Months      |        
|                                                         |                                                                                                                                                       | Ended March 31,           |        
|                                                         |                                                                                                                                                       |                           |        
|                                                         |                                                                                                                                                       | 2006                      |         |         | 2005 |  
|                                                         |                                                                                                                                                       |                           |         |         |      |  
|                                                         |                                                                                                                                                       | (In thousands, except per |        
|                                                         |                                                                                                                                                       | share amounts)            |        
|Consolidated Statements of Operations Data:              |                                                                                                                                                       |                           |         |         |      |   |         |        
|Operating revenues:                                      |                                                                                                                                                       |                           |         |         |      |   |         |        
|                                                         | Service revenues(1)                                                                                                                                   |                           | $       | 468,011 |      |   | $       | 378,858 |  
|                                                         | Equipment revenues(1)                                                                                                                                 |                           |         | 31,158  |      |   |         | 25,226  |  
|                                                         |                                                                                                                                                       |                           |         |         |      |  
|Total revenues                                           |                                                                                                                                                       |                           | 499,169 |         |      |   | 404,084 |        
|                                                         |                                                                                                                                                       |                           |         |         |      |  
|Operating expenses:                                      |                                                                                                                                                       |                           |         |         |      |   |         |        
|                                                         | Cost of service revenues (excludes depreciation of $37,138 and
    $32,499, and includes stock-based compensation of $1,527 and $0,
    respectively) |                           |         | 113,918 |      |   |         | 98,626  |  
|                                                         | Cost of equipment revenues(1)                                                                                                                         |                           |         | 44,650  |      |   |         | 44,798  |  
|                                                         | Selling, general and administrative (includes stock-based
    compensation of $3,351 and $127, respectively)                                          |                           |         | 162,649 |      |   |         | 138,299 |  
|                                                         | Depreciation and amortization                                                                                                                         |                           |         | 44,586  |      |   |         | 40,753  |  
|                                                         |                                                                                                                                                       |                           |         |         |      |  
|Total operating expenses                                 |                                                                                                                                                       |                           | 365,803 |         |      |   | 322,476 |        
|                                                         |                                                                                                                                                       |                           |         |         |      |  
|Income from operations                                   |                                                                                                                                                       |                           | 133,366 |         |      |   | 81,608  |        
|                                                         |                                                                                                                                                       |                           |         |         |      |  
|Other income (expense):                                  |                                                                                                                                                       |                           |         |         |      |   |         |        
|                                                         | Interest expense, net of capitalized interest                                                                                                         |                           |         | (18,029 | )    |   |         | (25,867 | )
|                                                         | Interest income                                                                                                                                       |                           |         | 2,474   |      |   |         | 2,643   |  
|                                                         | Loss on early extinguishment of debt                                                                                                                  |                           |         | (81     | )    |   |         |        |  
|                                                         |                                                                                                                                                       |                           |         |         |      |  
|Income before income tax provision                       |                                                                                                                                                       |                           | 117,730 |         |      |   | 58,384  |        
|Income tax provision                                     |                                                                                                                                                       |                           | (51,702 | )       |      |   | (1,852  | )      
|                                                         |                                                                                                                                                       |                           |         |         |      |  
|Net Income attributable to common stockholders           |                                                                                                                                                       | $                         | 66,028  |         |      | $ | 56,532  |        
|                                                         |                                                                                                                                                       |                           |         |         |      |  
|Net Income per share attributable to common stockholders |                                                                                                                                                       |                           |         |         |      |   |         |        
|                                                         | Basic                                                                                                                                                 |                           | $       | 0.23    |      |   | $       | 0.21    |  
|                                                         |                                                                                                                                                       |                           |         |         |      |  
|                                                         | Diluted                                                                                                                                               |                           | $       | 0.21    |      |   | $       | 0.19    |  
|                                                         |                                                                                                                                                       |                           |         |         |      |  
|Weighted average number of shares outstanding            |                                                                                                                                                       |                           |         |         |      |   |         |        
|                                                         | Basic                                                                                                                                                 |                           |         | 290,007 |      |   |         | 267,091 |  
|                                                         |                                                                                                                                                       |                           |         |         |      |  
|                                                         | Diluted                                                                                                                                               |                           |         | 308,891 |      |   |         | 308,335 |  
|                                                         |                                                                                                                                                       |                           |         |         |      |  

27



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|                                                      |  |                 |           |  |                    |   |           | 
|----------------------------------------------------- |  | --------------- | --------- |  | ------------------ | - | --------- | 
|                                                      |  | As of March 31, |           |  | As of December 31, |  
|                                                      |  | 2006            |           |  | 2005               |  
|                                                      |  |                 |           |  |                    |  
|                                                      |  | (In thousands)  |          
|Consolidated Balance Sheet Data:                      |  |                 |           |  |                    |   |           | 
|Cash and cash equivalents, and short-term investments |  | $               | 210,738   |  |                    | $ | 165,027   | 
|Property, plant and equipment, net                    |  |                 | 1,107,919 |  |                    |   | 1,079,050 | 
|FCC operating licenses, net                           |  |                 | 377,893   |  |                    |   | 376,254   | 
|Total assets                                          |  | $               | 2,317,509 |  |                    | $ | 2,293,928 | 
|Current liabilities                                   |  |                 | 197,097   |  |                    |   | 208,432   | 
|Long-term debt                                        |  |                 | 1,101,396 |  |                    |   | 1,226,608 | 
|Total stockholders equity                            |  |                 | 974,759   |  |                    |   | 819,197   | 
|Total liabilities and stockholders equity            |  | $               | 2,317,509 |  |                    | $ | 2,293,928 | 

|                                        |  |                 |           |  |                 |  |           | 
|--------------------------------------- |  | --------------- | --------- |  | --------------- |  | --------- | 
|                                        |  | As of March 31, |           |  | As of March 31, | 
|                                        |  | 2006            |           |  | 2005            | 
|                                        |  |                 |           |  |                 | 
|Other Data:                             |  |                 |           |  |                 |  |           | 
|Covered Pops (end of period) (millions) |  |                 | 42        |  |                 |  | 41        | 
|Subscribers (end of period)             |  |                 | 2,120,600 |  |                 |  | 1,701,800 | 

|                                   |  |                      |         |   |      |   |         |  
|---------------------------------- |  | -------------------- | ------- | - | ---- | - | ------- | -
|                                   |  | For the Three Months |        
|                                   |  | Ended March 31,      |        
|                                   |  |                      |        
|                                   |  | 2006                 |         |   | 2005 |  
|                                   |  |                      |         |   |      |  
|                                   |  | (In thousands)       |        
|Other Data:                        |  |                      |         |   |      |   |         |  
|Statements of Cash Flows Data:     |  |                      |         |   |      |   |         |  
|Net cash from operating activities |  | $                    | 160,402 |   |      | $ | 117,214 |  
|Net cash from investing activities |  | $                    | (78,695 | ) |      | $ | (37,281 | )
|Net cash from financing activities |  | $                    | (36,571 | ) |      | $ | 21,153  |  
|Adjusted EBITDA(2)                 |  | $                    | 182,830 |   |      | $ | 122,488 |  
|Net capital expenditures(3)        |  | $                    | 76,549  |   |      | $ | 56,557  |  






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Effective July 1, 2003, we adopted EITF Issue
    No. 00-21,
    Accounting for Revenue Arrangements with Multiple
    Deliverables,and elected to apply the provisions
    prospectively to our existing customer arrangements. See
    Managements Discussion and Analysis of Financial
    Condition and Results of Operations for a more detailed
    description of the impact of our adoption of this policy.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   
|(2) | The term EBITDA refers to a financial measure that
    is defined as earnings (loss) before interest, taxes,
    depreciation and amortization; we use the term Adjusted
    EBITDA to reflect that our financial measure also excludes
    cumulative effect of change in accounting principle, loss from
    disposal of assets, gain (loss) from early extinguishment of
    debt and stock-based compensation. Adjusted EBITDA is commonly
    used to analyze companies on the basis of leverage and
    liquidity. However, Adjusted EBITDA is not a measure determined
    under generally accepted accounting principles, or GAAP, in the
    United States of America and may not be comparable to similarly
    titled measures reported by other companies. Adjusted EBITDA
    should not be construed as a substitute for operating income or
    as a better measure of liquidity than cash flow from operating
    activities, which are determined in accordance with GAAP. We
    have presented Adjusted EBITDA to provide additional information
    with respect to our ability to meet future debt service, capital
    expenditure and working capital requirements. The following
    schedule reconciles

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| |                                                                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Adjusted EBITDA to net cash from operating activities reported
    on our Consolidated Condensed Statements of Cash Flows, which we
    believe is the most directly comparable GAAP measure:

|                                                                |                                     |                      |         |         |      |   |         |         | 
|--------------------------------------------------------------- | ----------------------------------- | -------------------- | ------- | ------- | ---- | - | ------- | ------- | 
|                                                                |                                     | For the Three Months |        
|                                                                |                                     | Ended March 31,      |        
|                                                                |                                     |                      |        
|                                                                |                                     | 2006                 |         |         | 2005 |  
|                                                                |                                     |                      |         |         |      |  
|                                                                |                                     | (In thousands)       |        
|Net cash from operating activities (as reported on Consolidated |                                     |                      |         |         |      |   |         |        
|                                                                | Condensed Statements of Cash Flows) |                      | $       | 160,402 |      |   | $       | 117,214 | 
|Adjustments to reconcile to Adjusted EBITDA:                    |                                     |                      |         |         |      |   |         |        
|Cash paid interest expense, net of capitalized amount           |                                     |                      | 27,288  |         |      |   | 29,117  |        
|Interest income                                                 |                                     |                      | (2,474  | )       |      |   | (2,643  | )      
|Change in working capital and other                             |                                     |                      | (2,386  | )       |      |   | (21,200 | )      
|                                                                |                                     |                      |         |         |      |  
|Adjusted EBITDA                                                 |                                     | $                    | 182,830 |         |      | $ | 122,488 |        
|                                                                |                                     |                      |         |         |      |  



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(3) | Net capital expenditures exclude capitalized interest and are
    offset by net proceeds from the sale and leaseback transactions
    of telecommunication towers and related assets to third parties
    accounted for as operating leases. Net capital expenditures as
    defined are not a measure determined under GAAP in the United
    States of America and may not be comparable to similarly titled
    measures reported by other companies. Net capital expenditures
    should not be construed as a substitute for capital expenditures
    reported on the Consolidated Condensed Statements of Cash Flows,
    which is determined in accordance with GAAP. We report net
    capital expenditures in this manner because we believe it
    reflects the net cash used by us for capital expenditures and to
    satisfy the reporting requirements for our debt covenants. The
    following schedule reconciles net capital expenditures to
    capital expenditures reported on our Consolidated Condensed
    Statements of Cash Flows, which we believe is the most directly
    comparable GAAP measure:

|                                                                                                |  |                      |        |   |      |   |         |  
|----------------------------------------------------------------------------------------------- |  | -------------------- | ------ | - | ---- | - | ------- | -
|                                                                                                |  | For the Three Months |       
|                                                                                                |  | Ended March 31,      |       
|                                                                                                |  |                      |       
|                                                                                                |  | 2006                 |        |   | 2005 |  
|                                                                                                |  |                      |        |   |      |  
|                                                                                                |  | (In thousands)       |       
|Capital expenditures (as reported on Consolidated Condensed
    Statements of Cash Flows)       |  | $                    | 75,735 |   |      | $ | 69,107  |  
|Less: cash paid portion of capitalized interest                                                 |  |                      | (297   | ) |      |   | (322    | )
|Less: cash proceeds from sale and lease-back transactions
    accounted for as operating leases |  |                      | (2,256 | ) |      |   | (405    | )
|Change in capital expenditures accrued or unpaid                                                |  |                      | 3,367  |   |      |   | (11,823 | )
|                                                                                                |  |                      |        |   |      |  
|Net capital expenditures                                                                        |  | $                    | 76,549 |   |      | $ | 56,557  |  
|                                                                                                |  |                      |        |   |      |  

Additional Reconciliations of Non-GAAP Financial Measures
(Unaudited)




ARPU  Average Revenue Per Unit




29



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|                                                                                      |  |                       |         |   |      |   |         |  
|------------------------------------------------------------------------------------- |  | --------------------- | ------- | - | ---- | - | ------- | -
|                                                                                      |  | For the Three Months  |        
|                                                                                      |  | Ended March 31,       |        
|                                                                                      |  |                       |        
|                                                                                      |  | 2006                  |         |   | 2005 |  
|                                                                                      |  |                       |         |   |      |  
|                                                                                      |  | (In thousands, except |        
|                                                                                      |  | ARPU)                 |        
|ARPU (without roaming revenues)                                                       |  |                       |         |   |      |   |         |  
|Service revenues (as reported on Consolidated Condensed
    Statements of Operations) |  | $                     | 468,011 |   |      | $ | 378,858 |  
|Adjust: activation fees deferred and recognized for
    SAB No. 101                   |  |                       | (184    | ) |      |   | (703    | )
|Add: activation fees reclassed for EITF No. 00-21(1)                                  |  |                       | 10,100  |   |      |   | 4,633   |  
|Less: roaming and other revenues                                                      |  |                       | (66,608 | ) |      |   | (48,476 | )
|                                                                                      |  |                       |         |   |      |  
|Service revenue for ARPU                                                              |  | $                     | 411,319 |   |      | $ | 334,312 |  
|                                                                                      |  |                       |         |   |      |  
|Average units (subscribers)                                                           |  |                       | 2,072   |   |      |   | 1,669   |  
|                                                                                      |  |                       |         |   |      |  
|ARPU                                                                                  |  | $                     | 66      |   |      | $ | 67      |  
|                                                                                      |  |                       |         |   |      |  

|                                                                                     |  |                       |         |   |      |   |         |  
|------------------------------------------------------------------------------------ |  | --------------------- | ------- | - | ---- | - | ------- | -
|                                                                                     |  | For the Three Months  |        
|                                                                                     |  | Ended March 31,       |        
|                                                                                     |  |                       |        
|                                                                                     |  | 2006                  |         |   | 2005 |  
|                                                                                     |  |                       |         |   |      |  
|                                                                                     |  | (In thousands, except |        
|                                                                                     |  | ARPU)                 |        
|ARPU (including roaming revenues)                                                    |  |                       |         |   |      |   |         |  
|Service revenues (as reported on Consolidated Condensed
    Statements of Operations |  | $                     | 468,011 |   |      | $ | 378,858 |  
|Adjust: activation fees deferred and recognized for
    SAB No. 101                  |  |                       | (184    | ) |      |   | (703    | )
|Add: activation fees reclassed for EITF No. 00-21(1)                                 |  |                       | 10,100  |   |      |   | 4,633   |  
|Less: other revenues                                                                 |  |                       | (7,851  | ) |      |   | (3,652  | )
|                                                                                     |  |                       |         |   |      |  
|Service revenue for ARPU                                                             |  | $                     | 470,076 |   |      | $ | 379,136 |  
|                                                                                     |  |                       |         |   |      |  
|Average units (subscribers)                                                          |  |                       | 2,072   |   |      |   | 1,669   |  
|                                                                                     |  |                       |         |   |      |  
|ARPU                                                                                 |  | $                     | 76      |   |      | $ | 76      |  
|                                                                                     |  |                       |         |   |      |  






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Since implementation of EITF Issue
    No. 00-21,
    Accounting for Revenue Arrangements with Multiple
    Deliverables,each month we recognize the activation
    fees, handset equipment revenues and equipment costs that had
    been previously deferred in accordance with
    SAB No. 101. Based on EITF Issue
    No. 00-21, we now
    recognize the activation fees that were formerly deferred and
    recognized as services revenues as equipment revenues.

LRS  Lifetime Revenue Per Subscriber




30



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|                                      |  |                 |       |   |      |   |       |  
|------------------------------------- |  | --------------- | ----- | - | ---- | - | ----- | -
|                                      |  | For the         |      
|                                      |  | Three Months    |      
|                                      |  | Ended March 31, |      
|                                      |  |                 |      
|                                      |  | 2006            |       |   | 2005 |  
|                                      |  |                 |       |   |      |  
|ARPU                                  |  | $               | 66    |   |      | $ | 67    |  
|Divided by: churn                     |  |                 | 1.4   | % |      |   | 1.4   | %
|                                      |  |                 |       |   |      |  
|Lifetime revenue per subscriber (LRS) |  | $               | 4,714 |   |      | $ | 4,786 |  
|                                      |  |                 |       |   |      |  



RESULTS OF OPERATIONS


Three Months Ended March 31, 2006 Compared to Three
Months Ended March 31, 2005




| |         
| | --------
| | Revenues







|                             |  |                                     |         |  |              |  |               |           |  |   |              |  |  |              |     |   |          |   |        |  |  |  |    |  
|---------------------------- |  | ----------------------------------- | ------- |  | ------------ |  | ------------- | --------- |  | - | ------------ |  |  | ------------ | --- | - | -------- | - | ------ |  |  |  | -- | -
|                             |  | For the Three                       |         |  |              |  | For the Three |           |  |   |              |  |  |             
|                             |  | Months                              |         |  |              |  | Months        |           |  |   |              | 
|                             |  | Ended                               |         |  | % of         |  |               | Ended     |  |   | % of         |  |  | 2006 vs 2005 |    
|                             |  | March 31,                           |         |  | Consolidated |  |               | March 31, |  |   | Consolidated |  |  |              |    
|                             |  | 2006                                |         |  | Revenues     |  |               | 2005      |  |   | Revenues     |  |  | $ Change     |     |   | % Change |  
|                             |  |                                     |         |  |              |  |               |           |  |   |              |  |  |              |     |   |          |  
|                             |  | (Dollars in thousands, expect ARPU) |        
|Service and roaming revenues |  | $                                   | 468,011 |  |              |  | 94            | %         |  | $ | 378,858      |  |  |              | 94  | % |          | $ | 89,153 |  |  |  | 24 | %
|Equipment revenues           |  |                                     | 31,158  |  |              |  | 6             | %         |  |   | 25,226       |  |  |              | 6   | % |          |   | 5,932  |  |  |  | 24 | %
|                             |  |                                     |         |  |              |  |               |           |  |   |              |  |  |              |     |   |          |  
|Total revenues               |  | $                                   | 499,169 |  |              |  | 100           | %         |  | $ | 404,084      |  |  |              | 100 | % |          | $ | 95,085 |  |  |  | 24 | %
|                             |  |                                     |         |  |              |  |               |           |  |   |              |  |  |              |     |   |          |  
|ARPU(1)                      |  | $                                   | 66      |  |              |  |               |           |  | $ | 67           |  |  |              |     |   |          |   |        |  |  |  |    |  
|                             |  |                                     |         |  |              |  |               |           |  |   |              |  |  |              |     |   |          |  






|    |                                                                                                                                                                                                                 
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | See  Selected Consolidated Financial
    Data  Additional Reconciliations of Non-GAAP
    Financial Measures (Unaudited) for more information
    regarding our use of ARPU as a non-GAAP financial measure.

31



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00-21, Accounting for Revenue Arrangements with Multiple
Deliverables, 00-21


|                                                                                                |  |                      |         |   |      |   |         |  
|----------------------------------------------------------------------------------------------- |  | -------------------- | ------- | - | ---- | - | ------- | -
|                                                                                                |  | For the Three Months |        
|                                                                                                |  | Ended March 31,      |        
|                                                                                                |  |                      |        
|                                                                                                |  | 2006                 |         |   | 2005 |  
|                                                                                                |  |                      |         |   |      |  
|                                                                                                |  | (In thousands)       |        
|Revenues:                                                                                       |  |                      |         |   |      |   |         |  
|Service revenues (as reported on Consolidated Condensed
    Statements of Operations)           |  | $                    | 468,011 |   |      | $ | 378,858 |  
|Previously deferred activation fees recognized
    (SAB No. 101)                                |  |                      | (184    | ) |      |   | (703    | )
|Activation fees to equipment revenues (EITF No. 00-21)                                          |  |                      | 10,100  |   |      |   | 4,633   |  
|                                                                                                |  |                      |         |   |      |  
|Total service revenues without SAB No. 101 and EITF
    No. 00-21                               |  | $                    | 477,927 |   |      | $ | 382,788 |  
|                                                                                                |  |                      |         |   |      |  
|Equipment revenues (as reported on Consolidated Condensed
    Statements of Operations)         |  | $                    | 31,158  |   |      | $ | 25,226  |  
|Previously deferred equipment revenues recognized
    (SAB No. 101)                             |  |                      | (1,130  | ) |      |   | (3,843  | )
|Activation fees from service revenues (EITF No. 00-21)                                          |  |                      | (10,100 | ) |      |   | (4,633  | )
|                                                                                                |  |                      |         |   |      |  
|Total equipment revenues without SAB No. 101 and
    EITF No. 00-21                             |  | $                    | 19,928  |   |      | $ | 16,750  |  
|                                                                                                |  |                      |         |   |      |  
|Cost of equipment revenues (as reported on Consolidated
    Condensed Statements of Operations) |  | $                    | 44,650  |   |      | $ | 44,798  |  
|Previously deferred cost of equipment revenues recognized
    (SAB No. 101)                     |  |                      | (1,314  | ) |      |   | (4,546  | )
|                                                                                                |  |                      |         |   |      |  
|Total cost of equipment revenues without
    SAB No. 101 and EITF No. 00-21                     |  | $                    | 43,336  |   |      | $ | 40,252  |  
|                                                                                                |  |                      |         |   |      |  

00-21


32



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| |                         
| | ------------------------
| | Cost of Service Revenues



13-1, Accounting for Rental Costs Incurred during a
Construction Period,






| |                           
| | --------------------------
| | Cost of Equipment Revenues



00-21)


|                                  |  |                      |         |   |      |   |         |  
|--------------------------------- |  | -------------------- | ------- | - | ---- | - | ------- | -
|                                  |  | For the Three Months |        
|                                  |  | Ended March 31,      |        
|                                  |  |                      |        
|                                  |  | 2006                 |         |   | 2005 |  
|                                  |  |                      |         |   |      |  
|                                  |  | (In thousands)       |        
|Equipment revenues billed         |  | $                    | 19,928  |   |      | $ | 16,750  |  
|Cost of equipment revenues billed |  |                      | (43,336 | ) |      |   | (40,252 | )
|                                  |  |                      |         |   |      |  
|Total gross subsidy for equipment |  | $                    | (23,408 | ) |      | $ | (23,502 | )
|                                  |  |                      |         |   |      |  

33



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| |                                             
| | --------------------------------------------
| | Selling, General and Administrative Expenses







| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | $3.5 million increase in advertising and media expenses as
    a result of general marketing campaigns and additional expenses
    incurred as the result of Sprint Nextels refusal to allow
    us to use the Sprint Nextel brand;                                                                                                                                                                                                                                                                                         
|
| |  | $0.9 million increase in facility and lease costs primarily
    for the additional company-owned stores put in operation in the
    first quarter of 2006;                                                                                                                                                                                                                                                                                                                                                                   
|
| |  | $1.1 million increase due to the adoption of
    SFAS No. 123R, which requires recognition of
    compensation expense for awards of equity instruments to
    employees based on grant-date fair value of those
    awards; and                                                                                                                                                                                                                                                                                             
|
| |  | $1.0 million increase in commissions, commission bonuses
    and residuals paid to account representatives and the indirect
    sales channel due primarily to the indirect sales channel adding
    approximately 17% more customers in the first quarter of 2006
    than in the first quarter of 2005. The indirect sales channel
    will remain a vital part of our distribution as we expect to see
    continued growth from this channel for the remainder of 2006
    coupled with growth from company-owned stores.





| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | $5.5 million increase in support of our information
    systems, facilities and corporate expenses, including
    approximately $1.7 million in expenses incurred in
    conjunction with the put process and legal proceedings with
    Sprint Nextel and Nextel WIP (see our Annual Report on
    Form 10-K for the
    year ended December 31, 2005 and Note 7 to the
    accompanying consolidated condensed financial statements for
    additional information);
|
| |  | $2.1 million increase due to the adoption of
    SFAS No. 123R, which requires recognition of
    compensation expense for awards of equity instruments to
    employees based on grant-date fair value of those
    awards; and                                                                                                                                                                                                                                      
|
| |  | $10.2 million increase in expenses for service and repair,
    billing, bad debt expense, collection and customer retention
    expenses, including handset upgrades to support a larger and
    growing customer base.                                                                                                                                                                                                                                               





| |   |                                                                                                                                                                                                                   
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | increased costs to support our growing customer base, including
    costs associated with billing, bad debt expense, collections,
    customer retention, customer care activities and handset
    upgrades;      
|
| |  | increased marketing and advertising expenses to offset the loss
    of national advertising of the Nextel brand name exclusively;                                                                                 
|
| |  | increased costs associated with opening additional retail
    stores; and                                                                                                                                         
|
| |  | costs related to the pending acquisition of us by Sprint Nextel,
    including, but not limited to, approximately $50 million in
    legal fees and professional fees plus approximately
    $116 million in stock

34



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| |  |                                                                                                                                                               
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | compensation expense due to options that vest in full upon
    change in control as well as known severance and retention
    payments and other cash bonuses.



| |                                      
| | -------------------------------------
| | Depreciation and Amortization Expense





| |                                     
| | ------------------------------------
| | Interest Expense and Interest Income

1 2




| |                                 
| | --------------------------------
| | Loss on Early Retirement of Debt





| |                     
| | --------------------
| | Income Tax Provision





| |                                               
| | ----------------------------------------------
| | Net Income Attributable to Common Stockholders



Liquidity and Capital Resources




35



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| |                                   
| | ----------------------------------
| | Statement of Cash Flows Discussion

|                                   |  |                                      |         |   |      |   |         |          |  |   |          |   |  |  |      |   
|---------------------------------- |  | ------------------------------------ | ------- | - | ---- | - | ------- | -------- |  | - | -------- | - |  |  | ---- | --
|                                   |  | For the Three Months Ended March 31, |        
|                                   |  |                                      |        
|                                   |  | 2006                                 |         |   | 2005 |   |         | $ Change |  |   | % Change |  
|                                   |  |                                      |         |   |      |   |         |          |  |   |          |  
|                                   |  | (Dollars in thousands)               |        
|Net cash from operating activities |  | $                                    | 160,402 |   |      | $ | 117,214 |          |  | $ | 43,188   |   |  |  | 37   | % 
|Net cash from investing activities |  | $                                    | (78,695 | ) |      | $ | (37,281 | )        |  | $ | (41,414  | ) |  |  | (111 | )%
|Net cash from financing activities |  | $                                    | (36,571 | ) |      | $ | 21,153  |          |  | $ | (57,724  | ) |  |  | (273 | )%





| |   |                                                                                                                                                                                                                  
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | a $63.0 million increase in income generated from operating
    activities, excluding changes in current assets and
    liabilities; and                                                                         
|
| |  | a $18.9 million increase in our accounts receivable balance
    from customers due to 25% growth in the number of subscribers in
    the first quarter of 2006 compared to the same period in 2005;
    offset by
|
| |  | a $18.4 million net decrease in accounts payable, accrued
    expenses, other current liabilities, other current and long-term
    assets and advances to Nextel WIP due to the timing of
    payments; and      
|
| |  | a $20.3 million decrease in our on-hand subscriber
    equipment inventory due primarily to adding new phone models
    during the first quarter of 2005.                                                        





| |   |                                                                                                                                                                                                                                                                                                                          
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | a $6.6 million increase in capital expenditures as a result
    of adding 84 cell sites during the three months ended
    March 31, 2006 compared to 62 cell sited added during the
    three months ended March 31, 2005;                                                                                               
|
| |  | a $2.4 million increase in FCC licenses acquired and other
    investing activities; and                                                                                                                                                                                                                                 
|
| |  | a $27.2 million decrease in purchases of short-term
    investments (outflow) offset by a $59.6 million
    decrease in cash proceeds from the sale and maturities of
    short-term investments (inflow) due to a smaller investment
    portfolio in the first quarter of 2006 compared to the same
    period in 2005.





| |   |                                                                                                                                 
| | - | --------------------------------------------------------------------------------------------------------------------------------
| |  | a $50.0 million increase in cash used in the first quarter
    of 2006 for a principal repayment on our tranche D term
    loan;
|
| |  | a $9.5 million decrease in proceeds from stock options
    exercised and employee purchases of stock; and                       
|
| |  | a $0.1 million increase in capital lease payments and other
    financing activities; offset by                                 
|
| |  | a $1.9 million increase in proceeds from sale-leaseback
    transactions.                                                       



| |                                  
| | ---------------------------------
| | Capital Needs and Funding Sources



36



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|                              |  |                        |         |  |      |   |         |      |  |   |         |  |  |      |         |  |            |   |         |       |  |   |           |  |  |   |           | 
|----------------------------- |  | ---------------------- | ------- |  | ---- | - | ------- | ---- |  | - | ------- |  |  | ---- | ------- |  | ---------- | - | ------- | ----- |  | - | --------- |  |  | - | --------- | 
|                              |  | Payments Due By Period |        
|                              |  |                        |        
|Contractual Obligations       |  | Remainder of 2006      |         |  | 2007 |   |         | 2008 |  |   | 2009    |  |  | 2010 |         |  | Thereafter |   |         | Total | 
|                              |  |                        |         |  |      |   |         |      |  |   |         |  |  |      |         |  |            |   |         |       | 
|                              |  | (In thousands)         |        
|Long-term debt                |  | $                      |        |  |      | $ | 3,750   |      |  | $ | 119,092 |  |  | $    | 5,000   |  |            | $ | 5,000   |       |  | $ | 956,250   |  |  | $ | 1,089,092 | 
|Interest on long-term debt(1) |  |                        | 46,286  |  |      |   | 74,620  |      |  |   | 74,096  |  |  |      | 72,345  |  |            |   | 71,842  |       |  |   | 75,679    |  |  |   | 414,868   | 
|Operating leases              |  |                        | 85,376  |  |      |   | 105,149 |      |  |   | 94,470  |  |  |      | 83,850  |  |            |   | 54,660  |       |  |   | 59,744    |  |  |   | 483,249   | 
|Capital lease obligations(2)  |  |                        | 3,920   |  |      |   | 5,227   |      |  |   | 5,227   |  |  |      | 5,227   |  |            |   |        |       |  |   |          |  |  |   | 19,601    | 
|Purchase obligations(3)       |  |                        |        |  |      |   |        |      |  |   |        |  |  |      |        |  |            |   |        |       |  |   |          |  |  |   |          | 
|                              |  |                        |         |  |      |   |         |      |  |   |         |  |  |      |         |  |            |   |         |       | 
|Total contractual obligations |  | $                      | 135,582 |  |      | $ | 188,746 |      |  | $ | 292,885 |  |  | $    | 166,422 |  |            | $ | 131,502 |       |  | $ | 1,091,673 |  |  | $ | 2,006,810 | 
|                              |  |                        |         |  |      |   |         |      |  |   |         |  |  |      |         |  |            |   |         |       | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Includes interest on swaps of approximately ($750,000) for the
    remainder of 2006. These amounts include estimated payments
    based on managements expectation as to future interest
    rates.                                                                                                                                                                                                                                                                                                                                                                           
|   
|(2) | Includes interest.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   
|(3) | We expect to pay significant amounts to Motorola for
    infrastructure, handsets and related services in future years.
    Potential amounts payable to Motorola are not shown above due to
    the uncertainty surrounding the timing and extent of these
    payments. See notes to the consolidated condensed financial
    statements appearing elsewhere in this Quarterly Report on
    Form 10-Q and
    notes to the consolidated financial statements in our Annual
    Report on
    Form 10-K for the
    year ended December 31, 2005 for amounts paid to Motorola.



| |                   
| | ------------------
| | Sources of Funding

10-K


10-K


37



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##### Table of Contents







Off-Balance Sheet Arrangements






Critical Accounting Policies


10-Q. 10-Q 10-K






| |                                       
| | --------------------------------------
| | Income Tax on Stock-Based Compensation



38



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##### Table of Contents



Related Party Transactions


10-Q


FORWARD-LOOKING STATEMENTS


10-K 10-Q.




| |   |                                                                                                                                                                                                                                                                                                                                                                            
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | our business plan, its advantages and our strategy for
    implementing our plan;                                                                                                                                                                                                                                                                                          
|
| |  | the success of efforts to improve and enhance, and
    satisfactorily address any issues relating to, our network
    performance;                                                                                                                                                                                                                                         
|
| |  | the characteristics of the geographic areas and occupational
    markets that we are targeting in our portion of the Nextel
    Digital Wireless Network;                                                                                                                                                                                                                  
|
| |  | our ability to attract and retain customers;                                                                                                                                                                                                                                                                                                                               
|
| |  | our anticipated capital expenditures, funding requirements and
    contractual obligations, including our ability to access
    sufficient debt or equity capital to meet operating and
    financing needs;                                                                                                                                                               
|
| |  | the availability of adequate quantities of system infrastructure
    and subscriber equipment and components to meet our service
    deployment, marketing plans and customer demand;                                                                                                                                                                                      
|
| |  | no significant adverse change in Motorolas ability or
    willingness to provide handsets and related equipment and
    software applications or to develop new technologies or features
    for us, or in our relationship with it;                                                                                                                                      
|
| |  | our ability to achieve and maintain market penetration and
    average subscriber revenue levels;                                                                                                                                                                                                                                                                          
|
| |  | our ability to successfully scale, in some circumstances in
    conjunction with third parties under our outsourcing
    arrangements, our billing, collection, customer care and similar
    back-office operations to keep pace with customer growth,
    increased system usage rates and growth in levels of accounts
    receivables being generated by our customers;
|
| |  | the development and availability of new handsets with expanded
    applications and features, including those that operate using
    the 6:1 voice coder, and market acceptance of such handsets and
    service offerings;                                                                                                                                                
|
| |  | the availability and cost of acquiring additional spectrum;                                                                                                                                                                                                                                                                                                                
|
| |  | the quality and price of similar or comparable wireless
    communications services offered or to be offered by our
    competitors, including providers of PCS and cellular services
    including, for example, two-way walkie-talkie services that have
    been introduced by several of our competitors;                                                              
|
| |  | future legislation or regulatory actions relating to specialized
    mobile radio services, other wireless communications services or
    telecommunications services generally;                                                                                                                                                                                           
|
| |  | the potential impact on us of the reconfiguration of the
    800 MHz band required by the rebanding orders issued to
    Nextel WIP;                                                                                                                                                                                                                                       

39



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##### Table of Contents





| |   |                                                                                                                                                                                        
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | delivery and successful implementation of any new technologies
    deployed in connection with any future enhanced iDEN or next
    generation or other advanced services we may offer;
|
| |  | the costs of compliance with regulatory mandates, particularly
    the requirement to deploy location-based 911 capabilities and
    wireless number portability; and                  
|
| |  | the anticipated closing of the acquisition of our shares of
    Class A common stock by Sprint Nextel.                                                                                 






|        |                                                               
|------- | --------------------------------------------------------------
|Item 3. | Quantitative and Qualitative Disclosures About Market
    Risk



1 8 1 2




Accounting for Derivative
Instruments and Hedging Activities, 10-Q




|                            |                       |                        |   |   |              |    |   |       |     |   |      |         |     |      |   |       |            |   |   |       |     |   |            |         |     |   |   |         |     |   |   |         |  | 
|--------------------------- | --------------------- | ---------------------- | - | - | ------------ | -- | - | ----- | --- | - | ---- | ------- | --- | ---- | - | ----- | ---------- | - | - | ----- | --- | - | ---------- | ------- | --- | - | - | ------- | --- | - | - | ------- |  | 
|                            |                       | Remainder of 2006      |   |   | 2007         |    |   | 2008  |     |   | 2009 |         |     | 2010 |   |       | Thereafter |   |   | Total |     |   | Fair Value |        
|                            |                       |                        |   |   |              |    |   |       |     |   |      |         |     |      |   |       |            |   |   |       |     |   |            |        
|                            |                       | (Dollars in thousands) |  
|Long-term debt obligations: |                       |                        |   |   |              |    |   |       |     |   |      |         |     |      |   |       |            |   |   |       |     |   |            |         |     |   |   |         |     |   |   |        
|                            | Fixed-rate debt       |                        | $ |  |              |    | $ |      |     |   | $    | 114,092 |     |      | $ |      |            |   | $ |      |     |   | $          | 475,000 |     |   | $ | 589,092 |     |   | $ | 824,242 | 
|                            |                       | Average interest rate  |   |   | 6.8          | %  |   |       | 6.8 | % |      |         | 7.0 | %    |   |       | 8.1        | % |   |       | 8.1 | % |            |         | 8.1 | % |   |         | 7.4 | % |   |         |  | 
|                            | Variable-rate debt(1) |                        | $ |  |              |    | $ | 3,750 |     |   | $    | 5,000   |     |      | $ | 5,000 |            |   | $ | 5,000 |     |   | $          | 481,250 |     |   | $ | 500,000 |     |   |   |         | 
|                            |                       | Average interest rate  |   |   | (LIBOR + 1.5 | )% |   |       |     |   |      |         |     |      |   |       |            |   |   |       |     |   |            |         |     |   |   |         |     |   |   |         |  | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | As of March 31, 2006, variable-rate debt consisted of our
    bank credit facility. The bank credit facility includes a
    $500.0 million tranche D term loan, a
    $100.0 million revolving credit facility and an option to
    request an additional $200.0 million of incremental term
    loans. The tranche D term loan bears interest, at our
    option, at the administrative agents alternate base rate
    or reserve-adjusted LIBOR plus, in each case, applicable margin.
    The initial applicable margin for the tranche D term loan
    is 1.50% over LIBOR and 0.50% over the base rate. For the
    revolving credit facility, the initial applicable margin is
    3.00% over

40



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##### Table of Contents



| |                                                                                                                                                                                                                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | LIBOR and 2.00% over the base rate and thereafter will be
    determined on the basis of the ratio of total debt to annualized
    EBITDA and will range between 1.50% and 3.00% over LIBOR and
    between 0.50% and 2.00% over the base rate. As of March 31,
    2006, the average interest rate on the tranche D term loan
    was 6.32%.



|                     |                                           |                        |   |         |      |  |      |   |      |  |      |   |            |  |       |   |            |       |   |   |  |  |   |   |  |  |   |         |  |  |   |     | 
|-------------------- | ----------------------------------------- | ---------------------- | - | ------- | ---- |  | ---- | - | ---- |  | ---- | - | ---------- |  | ----- | - | ---------- | ----- | - | - |  |  | - | - |  |  | - | ------- |  |  | - | --- | 
|                     |                                           | Remainder              |   |         |      |  |      |   |      |  |      |   |            |  |       |   | Fair Value |      
|                     |                                           | of 2006                |   |         | 2007 |  | 2008 |   | 2009 |  | 2010 |   | Thereafter |  | Total |   |            | Asset |  
|                     |                                           |                        |   |         |      |  |      |   |      |  |      |   |            |  |       |   |            |       |  
|                     |                                           | (Dollars in thousands) |  
|Interest rate swaps: |                                           |                        |   |         |      |  |      |   |      |  |      |   |            |  |       |   |            |       |   |   |  |  |   |   |  |  |   |         |  |  |   |    
|                     | Notional amount(1)                        |                        | $ | 100,000 |      |  | $    |  |      |  | $    |  |            |  | $     |  |            |       | $ |  |  |  | $ |  |  |  | $ | 100,000 |  |  | $ | 689 | 
|                     | Weighted-average fixed rate payable(2)    |                        |   | 3.6     | %    |  |      |  |      |  |      |  |            |  |       |  |            |       |   |  |  |  |   |  |  |  |   |        |  |  |   |    | 
|                     | Weighted-average fixed rate receivable(3) |                        |   |        |      |  |      |  |      |  |      |  |            |  |       |  |            |       |   |  |  |  |   |  |  |  |   |        |  |  |   |    | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Includes notional amounts of $100.0 million that will
    expire in August 2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   
|(2) | Represents the weighted-average fixed rate based on the contract
    notional amount as a percentage of total notional amounts in a
    given year.                                                                                                                                                                                                                                                                                                                                                                                 
|   
|(3) | The initial applicable margin for the tranche D term loan
    is 1.50% over LIBOR and 0.50% over the base rate. For the
    revolving credit facility, the applicable margin is 3.00% over
    LIBOR and 2.00% over the base rate and thereafter will be
    determined on the basis of the ratio of total debt to annualized
    EBITDA and will range between 1.50% and 3.00% over LIBOR and
    between 0.50% and 2.00% over the base rate. As of March 31,
    2006, the interest rate on the tranche D term loan was
    6.32%.






|        |                        
|------- | -----------------------
|Item 4. | Controls and Procedures

13a-15(e) 15d-15(e)







PART II  OTHER INFORMATION







|        |                  
|------- | -----------------
|Item 1. | Legal Proceedings

10-Q




41



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##### Table of Contents








|         |             
|-------- | ------------
|Item 1A. | Risk Factors

10-K







|        |         
|------- | --------
|Item 6. | Exhibits

|    |    |                   |  |                                                                                                                                                                                                                 
|--- | -- | ----------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |    | List of Exhibits.
|    |    |                  
|    | 3  | .1                |  | Restated Certificate of Incorporation (incorporated by reference
    to Exhibit 3.1.1 to Registration Statement on Form S-1
    declared effective February 22, 2000 (File
    No. 333-95473)).                 
|    | 3  | .1(a)             |  | Certificate of Amendment to the Restated Certificate of
    Incorporation of Nextel Partners, Inc. (incorporated by
    reference to Exhibit 3.1 (a) to Quarterly Report on
    Form 10-Q filed August 9, 2004).
|    | 3  | .2                |  | Amended and Restated Bylaws, effective of June 3, 2004
    (incorporated by reference to Exhibit 3.2 to Annual Report
    on Form 10-K filed March 16, 2005).                                                   
|    | 31 | .1                |  | Certification of John Chapple, Chairman and Chief Executive
    Officer of Nextel Partners, Inc., pursuant to Exchange Act
    Rule 13a-14(a) under the Securities Exchange Act of 1934                         
|    | 31 | .2                |  | Certification of Barry Rowan, Chief Financial Officer of Nextel
    Partners, Inc., pursuant to Exchange Act Rule 13a-14(a)
    under the Securities Exchange Act of 1934                                       
|    | 32 | .1                |  | Certification of John Chapple, Chairman and Chief Executive
    Officer of Nextel Partners, Inc., pursuant to 18. U.S.C.
    Section 1350.                                                                      
|    | 32 | .2                |  | Certification of Barry Rowan, Chief Financial Officer of Nextel
    Partners, Inc., pursuant to 18 U.S.C. Section 1350.                                                                                         

42



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SIGNATURES






| |                      
| | ---------------------
| | NEXTEL PARTNERS, INC.
| | (Registrant)         



| |     |                
| | --- | ---------------
| | By: | /s/ BARRY ROWAN

| |                                                  
| | -------------------------------------------------
| |                                                  
| | Barry Rowan                                      
| | Executive Vice President, Chief Financial Officer
| | (Principal Financial Officer)                    



| |     |                
| | --- | ---------------
| | By: | /s/ LINDA ALLEN

| |                               
| | ------------------------------
| |                               
| | Linda Allen                   
| | Chief Accounting Officer      
| | (Principal Accounting Officer)



43