US Cellular 2012 Annual Report Download - page 30

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 ‘‘Divestiture Transaction’’ above in
this Management’s Discussion and Analysis of Financial Condition and Results of Operations and
Note 7—Acquisitions, Divestitures and Exchanges in the Notes to Consolidated Financial Statements for
details on significant transactions in 2012 and 2011.
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 2012, 2011 and 2010, see Note 14—Common Shareholders’ Equity in the
Notes to Consolidated Financial Statements.
Contractual and Other Obligations
At December 31, 2012, the resources required for contractual obligations were as follows:
Payments Due by Period
Less Than 1 - 3 3 - 5 More Than
Total 1 Year Years Years 5 Years
(Dollars in millions)
Long-term debt obligations(1) ................. $ 886.0 $ — $ — $ — $ 886.0
Interest payments on long-term debt obligations . . . 1,906.2 60.2 120.4 120.4 1,605.2
Operating leases(2) ........................ 1,361.7 151.6 235.9 164.9 809.3
Capital leases ............................ 9.4 0.6 1.2 1.2 6.4
Purchase obligations(3) ..................... 846.5 434.1 246.9 106.8 58.7
$5,009.8 $646.5 $604.4 $393.3 $3,365.6
(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 capital leases and the
$11.8 million unamortized discount related to U.S. Cellular’s 6.7% Senior Notes. See Note 12—Debt
in the Notes to Consolidated Financial Statements for additional information.
(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 for
additional information.
(3) Includes obligations payable under non-cancellable contracts, commitments for network facilities and
transport services, agreements for software licensing and long-term marketing programs. As
described more fully in the ‘‘Divestiture Transaction’’ section of Management’s Discussion and
Analysis of Financial Condition and Results of Operations and in Note 7—Acquisitions, Divestitures
and Exchanges in the Notes to Consolidated Financial Statements, U.S. Cellular expects to incur
network-related exit costs in the Divestiture Markets as a result of the transaction, including: (i) costs
to decommission cell sites and mobile telephone switching office (‘‘MTSO’’) sites, (ii) costs to
terminate real property leases and (iii) costs to terminate certain network access arrangements in the
subject markets. The impacts of these exit activities on U.S. Cellular’s purchase obligations are
reflected in the table above only to the extent that agreements were consummated at December 31,
2012.
22