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## Notes to Consolidated Financial Statements 

Useful lives range from fifteen to twenty years for cable and wire, eight to twelve years for central office equipment, five to ten years for office furniture and equipment, and ten to fifteen for other equipment. Buildings are depreciated over thirty years. The provision for depreciation as a percentage of depreciable property was 7.9% in 2001, 7.9% in 2000, and 7.8% in 1999. 

## 11 Supplemental Cash Flow Disclosures 

Following are supplemental cash flow disclosures for interest and income taxes paid and certain noncash transactions. 

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## 12 Acquisitions 

Cash expenditures for acquisitions aggregated $392.8 million in 2001, $200.7 million in 2000, and $31.3 million in 1999. 

On September 4, 2001, the Company acquired 100 percent of the outstanding common shares of Chorus Communications Group, Ltd. The aggregate purchase price was $202.8 million in cash, excluding cash acquired. The results of Chorus’ operations are included in the consolidated financial statements since that date. Chorus is a telecommunications company serving approximately 43,000 business and residential access lines and 27,000 Internet customers primarily in Wisconsin. Its other operations include selling, installing, and servicing business telephone and videoconferencing systems, data networks, Internet access and long-distance. 

The following table summarizes the estimated fair values of the Chorus assets acquired and liabilities assumed at the date of acquisition. 

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The $150.0 million of goodwill was assigned to the telephone segment. None of the goodwill is expected to be deductible for tax purposes. 

In addition, during 2001 the Company acquired 100 percent of an operating cellular market for $56.2 million in cash, certain PCS licenses for $124.1 million in cash and a small telephone company and certain other assets for $9.7 million in cash and $1.1 million of deferred cash payments. These expenditures increased cellular license costs by $165.7 million and telephone franchise and other costs by $1.4 million. 

During 2000, the Company acquired 100 percent of the stock of Southeast Telephone Company, an operating telephone company serving approximately 10,000 access lines in southeastern Wisconsin, for $39.5 million in cash (net of cash acquired). The Company also acquired additional interests in majority-owned operations and in certain unconsolidated entities during 2000. The Company purchased the 48.7% interest in a telephone company it did not own for $52.5 million in cash; purchased additional interests in certain majority-owned cellular markets for $18.5 million in cash; made a deposit on certain PCS licenses totaling $51.1 million; and purchased additional interests in certain cellular markets where the Company holds a minority position for $39.1 million in cash and $13.0 million of deferred cash payments. These expenditures increased cellular license costs by $111.5 million, telephone franchise and other costs by $31.6 million and investments in unconsolidated entities by $50.1 million. 

## Notes to Consolidated Financial Statements 

During 1999, the Company acquired additional interests in majority-owned markets, a controlling interest in a cellular market and a small operating telephone company for an aggregate cash consideration of $31.3 million. These expenditures increased cellular license costs by $22.6 million and telephone franchise and other costs by $1.5 million. 

## 13 Gain (Loss) on Marketable Securities and Other Investments 

During 2001, the Company recognized a $644.9 million loss as a result of the VoiceStream Wireless Corporation merger with Deutsche Telekom AG and a $96.1 million gain as a result of the VeriSign, Inc. acquisition of Illuminet Holdings, Inc. During 1999, the Company recognized a $327.1 million gain as a result of the merger of AirTouch and Vodafone Group plc. The Company recognizes gains and losses on the difference between the accounting basis of the shares given up and the fair value of the shares and cash, if any, received. 

The sale of non-strategic cellular interests and other investments, and the write-down of the carrying value of the investment in TSR Wireless and the settlement of a legal matter in 2000 generated net gains totaling $0.5 million, $15.7 million and $18.8 million in 2001, 2000 and 1999, respectively. 

These transactions generated net cash proceeds of $570.5 million, $115.4 million and $120.0 million in 2001, 2000 and 1999, respectively. 

## 14 Notes Payable 

The Company has used short-term debt to finance acquisitions, for general corporate purposes and to repurchase common shares. Proceeds from the sale of long-term debt and equity securities from time to time have been used to reduce such short-term debt. Proceeds from the sale of non-strategic cellular and other investments from time to time have also been used to reduce short-term debt. 

TDS had a $500 million revolving credit facility with a group of banks at December 31, 2001, all of which was unused. On January 24, 2002, TDS completed a new $600 million credit facility with a group of banks replacing the existing credit facility. The terms of the Revolving Credit Facility provide for borrowings with interest at the London InterBank Offered Rate 

(“LIBOR”) plus a margin percentage based on the Company’s credit rating. The margin percentage on the new facility is 30.0 basis points (for a rate of 2.2% based on the LIBOR rate at December 31, 2001). The margin percentage increases by 10.0 basis points if more than 50% of the facility is outstanding. Interest and principal are due the last day of the borrowing period, as selected by TDS, of either seven days or one, two, three, or six months. TDS pays facility and administration fees at an aggregate annual rate of 0.146% of the total $600 million facility. The credit facility expires in January 2007. 

TDS also had $87 million in direct bank lines of credit at December 31, 2001, all of which was unused. The terms of the direct bank lines of credit provide for borrowings at negotiated rates up to the prime rate. 

U.S. Cellular had a $500 million revolving credit facility with a group of banks at December 31, 2001, $236 million of which was unused. The terms of the credit facility provide for borrowings with interest at the LIBOR rate plus a margin percentage based on the Company’s credit rating. At December 31, 2001, the margin percentage was 19.5 basis points (for a rate of 2.1%). Interest and principal are due the last day of the borrowing period, as selected by U.S. Cellular, of either seven days or one, two, three or six months. U.S. Cellular pays facility and administration fees at an aggregate annual rate of 0.142% of the total $500 million facility. The credit facility expires in August 2004. 

The carrying amount of short-term debt approximates fair value due to the short-term nature of these instruments. Information concerning notes payable is shown in the table that follows. 

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(1) The average was computed based on month-end balances. 

