US Cellular 2009 Annual Report Download - page 27

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Acquisitions, Divestitures and Exchanges
U.S. Cellular assesses its existing wireless interests on an ongoing basis with a goal of improving the
competitiveness of its operations and maximizing its long-term return on investment. As part of this
strategy, U.S. Cellular reviews attractive opportunities to acquire additional wireless operating markets
and wireless spectrum. In addition, U.S. Cellular may seek to divest outright or include in exchanges for
other wireless interests those wireless interests that are not strategic to its long-term success.
U.S. Cellular also from time to time may be engaged in negotiations relating to the acquisition, divestiture
or exchange of companies, strategic properties or wireless spectrum. In general, U.S. Cellular may not
disclose such transactions until there is a definitive agreement. See Note 8—Acquisitions, Divestitures
and Exchanges in the Notes to Consolidated Financial Statements for details on significant transactions
in 2009, 2008 and 2007.
Variable Interest Entities
U.S. Cellular consolidates certain entities because they are ‘‘variable interest entities’’ under accounting
principles generally accepted in the United States of America (‘‘GAAP’’). See Note 6—Variable Interest
Entities in the Notes to Consolidated Financial Statements for the details of these variable interest
entities. U.S. Cellular may elect to make additional capital contributions and/or advances to these
variable interest entities in future periods in order to fund their operations.
Common Share Repurchase Program
U.S. Cellular has repurchased and expects to continue to repurchase its Common Shares subject to the
repurchase program. For additional information related to the current repurchase authorization and
repurchases made during 2009, 2008 and 2007, see Note 15—Common Shareholders’ Equity in the
Notes to Consolidated Financial Statements.
Contractual and Other Obligations
At December 31, 2009, the resources required for contractual obligations were as follows:
Payments Due by Period
Less Than 2 - 3 4 - 5 More Than
(Dollars in millions) Total 1 Year Years Years 5 Years
Long-term debt obligations(1) ................. $ 874.0 $ — $ — $ — $ 874.0
Interest payments on long-term debt obligations . . . 1,481.2 61.2 122.4 122.4 1,175.2
Operating leases(2) ........................ 1,036.3 135.0 213.7 129.5 558.1
Capital leases ............................ 8.9 0.5 1.1 1.1 6.2
Purchase obligations(3) ..................... 695.0 416.9 177.5 61.9 38.7
$4,095.4 $613.6 $514.7 $314.9 $2,652.2
(1) Includes current and long-term portions of debt obligations. The total long-term debt obligation
differs from Long-term debt on the Consolidated Balance Sheet due to the $10.8 million unamortized
discount related to U.S. Cellular’s 6.7% senior notes. See Note 13—Debt in the Notes to
Consolidated Financial Statements.
(2) Includes future lease costs related to office space, retail sites, cell sites and equipment. See
Note 14—Commitments and Contingencies in the Notes to Consolidated Financial Statements.
(3) Includes obligations payable under non-cancellable contracts, commitments for network facilities and
transport services, agreements for software licensing and long-term marketing programs.
The table above does not include any liabilities related to ‘‘unrecognized tax benefits’’ as defined by
GAAP because U.S. Cellular is unable to predict the period of settlement of such liabilities. Such
unrecognized tax benefits were $34.4 million at December 31, 2009. See Note 5—Income Taxes in the
Notes to Consolidated Financial Statements for additional information on unrecognized tax benefits.
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