US Cellular 2010 Annual Report Download - page 27

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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 5—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 2010, 2009 and 2008, see Note 14—Common Shareholders’ Equity in the
Notes to Consolidated Financial Statements.
Contractual and Other Obligations
At December 31, 2010, 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) ................. $ 874.1 $ — $ — $ — $ 874.1
Interest payments on long-term debt obligations . . . 1,419.9 61.2 122.4 122.4 1,113.9
Operating leases(2) ........................ 1,178.1 142.4 222.1 136.9 676.7
Capital leases ............................ 8.6 0.5 1.1 1.2 5.8
Purchase obligations(3) ..................... 755.2 414.3 227.7 60.9 52.3
$4,235.9 $618.4 $573.3 $321.4 $2,722.8
(1) Includes current and long-term portions of debt obligations. The total long-term debt obligation
differs from Long-term debt in the Consolidated Balance Sheet due to the $10.3 million unamortized
discount related to U.S. Cellular’s 6.7% senior notes and capital leases. See Note 12—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 13—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 excludes 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 $32.5 million at December 31, 2010. See Note 4—Income Taxes in the Notes to
Consolidated Financial Statements for additional information on unrecognized tax benefits.
Off-Balance Sheet Arrangements
U.S. Cellular has no transactions, agreements or other contractual arrangements with unconsolidated
entities involving ‘‘off-balance sheet arrangements,’’ as defined by Securities and Exchange Commission
rules, that had or are reasonably likely to have a material current or future effect on its financial
condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital
expenditures or capital resources.
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