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Table of Contents
ECHOSTAR COMMUNICATIONS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — Continued
As of December 31, 2006, 2005 and 2004 there were options to purchase 10.2 million, 10.4 million and 10.9 million shares of Class A common
stock outstanding, respectively, not included in the above denominator as their effect is antidilutive.
Vesting of options and rights to acquire shares of our Class A common stock (“Restricted Performance Units”) granted pursuant to our long
term incentive plans is contingent upon meeting certain long-
term goals which have not yet been achieved. As a consequence, the following are
not included in the diluted EPS calculation:
New Accounting Pronouncements
In July 2006, the FASB issued Interpretation No. 48, “Accounting for Uncertainty in Income Taxes – An Interpretation of FASB Statement
No. 109
” (“FIN 48”), which clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in
accordance with SFAS 109. FIN 48 also prescribes a recognition threshold and measurement attribute for the financial statement recognition
and measurement of a tax position taken or expected to be taken in a tax return. In addition, FIN 48 provides guidance on derecognition,
classification, interest and penalties, accounting in interim periods, disclosure and transition. The provisions of FIN 48, which are effective for
fiscal years beginning after December 15, 2006, were adopted effective January 1, 2007. We do not expect the adoption of FIN 48 to have a
material impact on our consolidated financial position, results of operations or effective tax rate.
In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS 157”) which defines fair value, establishes a
framework for measuring fair value in accordance with generally accepted accounting principles
F - 18
For the Years Ended December 31,
2006
2005
2004
(In thousands, except per share data)
Numerator:
Numerator for basic net income (loss) per share
—
Net income (loss)
$
608,272
$
1,514,540
$
214,769
Interest on dilutive subordinated convertible notes, net of related tax effect
9,834
46,148
—
Numerator for diluted net income (loss) per common share
$
618,106
$
1,560,688
$
214,769
Denominator:
Denominator for basic net income (loss) per common share - weighted-average common
shares outstanding
444,743
452,118
464,053
Dilutive impact of options outstanding
677
1,648
3,545
Dilutive impact of subordinated notes convertible into common shares
7,265
30,365
—
Denominator for diluted net income (loss) per share - weighted-average diluted common
shares outstanding
452,685
484,131
467,598
Net income (loss) per share:
Basic net income (loss)
$
1.37
$
3.35
$
0.46
Diluted net income (loss)
$
1.37
$
3.22
$
0.46
Shares of Class A common stock issuable upon conversion of:
5 3/4% Convertible Subordinated Notes due 2008
23,100
23,100
23,100
3% Convertible Subordinated Note due 2010
6,866
6,866
6,866
3% Convertible Subordinated Note due 2011
399
399
399
For the Years Ended December 31,
2006
2005
2004
(In thousands)
Performance based options
11,007
11,229
6,994
Restricted Performance Units
725
545
—