NTLS » Topics » Operating Leases

These excerpts taken from the NTLS 10-K filed Feb 27, 2009.

Operating Leases

The Company has operating leases for administrative office space, retail space, tower space, and equipment, certain of which have renewal options. The leases for retail and tower space have initial lease periods of one to thirty years. These leases are associated with the operation of wireless digital PCS services primarily in Virginia and West Virginia. These leases, with few exceptions, provide for automatic renewal options and escalations that are either fixed or based on the consumer price index. Any rent abatements, along with rent escalations, are included in the computation of rent expense calculated on a straight-line basis over the lease term. The Company’s minimum lease term for most leases includes the initial non-cancelable term plus at least one renewal period, as the exercise of the related renewal option or options is reasonably assured. The Company’s cell site leases generally provide for an initial non-cancelable term of 5 to 7 years with up to 5 renewal options of 5 years each. Leasehold improvements are depreciated over the shorter of the assets useful life or the lease term, including renewal option periods that are reasonably assured.

Operating Leases

The
Company has operating leases for administrative office space, retail space, tower space, and equipment, certain of which have renewal options. The leases for retail and tower space have initial lease periods of one to thirty years. These leases are
associated with the operation of wireless digital PCS services primarily in Virginia and West Virginia. These leases, with few exceptions, provide for automatic renewal options and escalations that are either fixed or based on the consumer price
index. Any rent abatements, along with rent escalations, are included in the computation of rent expense calculated on a straight-line basis over the lease term. The Company’s minimum lease term for most leases includes the initial
non-cancelable term plus at least one renewal period, as the exercise of the related renewal option or options is reasonably assured. The Company’s cell site leases generally provide for an initial non-cancelable term of 5 to 7 years with up to
5 renewal options of 5 years each. Leasehold improvements are depreciated over the shorter of the assets useful life or the lease term, including renewal option periods that are reasonably assured.

STYLE="margin-top:18px;margin-bottom:0px">Income Taxes

Deferred income taxes are provided on an asset and
liability method whereby deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of
assets and liabilities and their tax bases. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company accrues interest and penalties related to unrecognized tax benefits
in interest expense and income tax expense, respectively.

Operating Leases

Rental expense for all operating leases for the year ended December 31, 2008, 2007 and 2006 was $28.5 million, $25.2 million and $23.2 million, respectively. The total amount committed under these lease agreements at December 31, 2008 is: $26.2 million in 2009, $20.4 million in 2010, $14.8 million in 2011, $10.7 million in 2012, $6.7 million in 2013 and $15.4 million for the years thereafter.

Operating
Leases

Rental expense for all operating leases for the year ended December 31, 2008, 2007 and 2006 was $28.5 million, $25.2 million and $23.2
million, respectively. The total amount committed under these lease agreements at December 31, 2008 is: $26.2 million in 2009, $20.4 million in 2010, $14.8 million in 2011, $10.7 million in 2012, $6.7 million in 2013 and $15.4 million for the
years thereafter.

These excerpts taken from the NTLS 10-K filed Feb 28, 2008.

Operating Leases

The
Company has operating leases for administrative office space, retail space, tower space, channel rights and equipment, certain of which have renewal options. The leases for retail and tower space have initial lease periods of one to thirty years.
These leases are associated with the operation of wireless digital PCS services primarily in Virginia and West Virginia. These leases, with few exceptions, provide for automatic renewal options and escalations that are either fixed or based on the
consumer price index. Any rent abatements, along with rent escalations, are included in the computation of rent expense calculated on a straight-line basis over the lease term. The Company’s minimum lease term for most leases includes the
initial non-cancelable term plus at least one renewal period, as the exercise of the related renewal option or options is reasonably assured. Our cell site leases generally provide for an initial non-cancelable term of 5 to 7 years with up to 5
renewal options of 5 years each. Leasehold improvements are depreciated over the shorter of the assets useful life or the lease term, including renewal option periods that are reasonably assured.

STYLE="margin-top:12px;margin-bottom:0px">The leases for channel rights related to the Company’s BRS/EBS (formerly known as MMDS/ITFS) spectrum, formerly used by the wireless cable operations and currently
used to deliver portable broadband internet service in certain markets, have initial terms of three to ten years. The equipment leases have an initial term of three years.

FACE="Times New Roman" SIZE="2">Income Taxes

Deferred income taxes are provided on an asset and liability method whereby deferred tax assets are
recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases.
Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. We accrue interest and penalties related to unrecognized tax benefits in interest expense and income tax expense,
respectively.

Operating Leases

The Company has several operating leases for administrative office space, retail space, tower space, channel rights and equipment, certain of which have renewal options. The leases for retail and tower space have initial lease periods of one to thirty years. These leases are associated with the operation of wireless digital PCS services primarily in Virginia and West Virginia. The leases for channel rights related to the Company’s MMDS spectrum, formerly used by the wireless cable operations and currently used to deliver a portable broadband Internet service in certain markets, have initial terms of three to ten years. The equipment leases have an initial term of three years. Rental expense for all operating leases was $6.2 million for the period January 1, 2005 through May 1, 2005.

This excerpt taken from the NTLS 10-K filed Mar 13, 2007.

Operating Leases

The Company has several operating leases for administrative office space, retail space, tower space, channel rights and equipment, certain of which have renewal options. The leases for retail and tower space have initial lease periods of one to thirty years. These leases are associated with the operation of wireless digital PCS services primarily in Virginia and West Virginia. The leases for channel rights related to the Company’s MMDS spectrum, formerly used by the wireless cable operations and currently used to deliver a portable broadband Internet service in certain markets, have initial terms of three to ten years. The equipment leases have an initial term of three years. Rental expense for all operating leases was $6.2 million for the period January 1, 2005 through May 1, 2005 and $18.0 million for the year ended December 31, 2004.

This excerpt taken from the NTLS 10-K filed Mar 28, 2006.

Operating Leases

The Company has several operating leases for administrative office space, retail space, tower space, channel rights and equipment, certain of which have renewal options. The leases for retail and tower space have initial lease periods of one to thirty years. These leases are associated with the operation of wireless digital PCS services primarily in Virginia and West Virginia. The leases for channel rights related to the Company’s MMDS spectrum, formerly used by the wireless cable operations and currently used to deliver a portable broadband Internet service in certain markets, have initial terms of three to ten years. The equipment leases have an initial term of three years. Rental expense for all operating leases was $6.2 million for the period January 1, 2005 through May 1, 2005, $18.0 million for the year ended 2004, $12.0 million for the period January 1 through September 9, 2003 and $5.1 million for the period September 10, 2003 through December 31, 2003. The total amount committed under these lease agreements at May 1, 2005 is: $11.7 million for the period May 2, 2005 through December 31, 2005, $15.9 million in 2006, $13.4 million in 2007, $12.0 million in 2008, $11.2 million in 2009, $6.3 million in 2010 and $12.3 million for the years thereafter.

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