Note 1. Summary of Significant Accounting Policies (Continued) Reclassifications: Certain amounts reported in the 2002 and 2001 financial statements have been reclassified to conform with the 2003 presentation, with no effect on net income or shareholders’ equity. Note 2. Discontinued Operations In November 2002, the Company entered into an agreement to sell its 66% General Partner interest in the Virginia 10 RSA Limited Partnership (cellular operation) to Verizon Wireless for $37.0 million. The closing of the sale took place at the close of business on February 28, 2003. The total proceeds received were $38.7 million, including $5.0 million held in escrow, and a $1.7 million adjustment for estimated working capital at the time of closing. There was a post closing adjustment based on the actual working capital balance as of the closing date, which resulted in a $39 thousand charge for the Company. The $5.0 million escrow was established for any contingencies and indemnification issues that may arise during the two-year post-closing period and is included in deferred charges and other assets in the 2003 consolidated balance sheet. The Company’s gain on the transaction was approximately $35  million. Post closing, the Company provided transition services to Verizon for a period of approximately three months, with compensation for those services being approximately $40 thousand per month during the transition period. The assets and liabilities attributable to the cellular operation have been classified as held for sale in the consolidated balance sheets and consist of the following at December 31, 2002 and 2001: The operations of the cellular partnership including the minority interest have been reclassified as discontinued operations, net of taxes in the consolidated statements of income for all periods presented. Operating results and the sale of the discontinued operations are summarized as follows: 2002 2001 Assets (in tho usands ) Accounts receivable $ 2,608 $ 2,759 Other current assets 309 214 Property, plant and equipment, (net) 2,631 3,272 Total assets $ 5,548 $ 6,245 Liabilities and minority interest Accounts payable and accrued expenses $ 381 $ 499 Deferred revenue and deposits 161 236 Minority interest 1,666 1,838 Total liabilities and minority interest $ 2,208 $ 2,573 (in thousands) 2002 2001 (in th ousands) $ 2,608 $ 2,759 309 214 2,631 3,272 $ 5,548 $ 6,245 $ 381 $ 499 161 236 1,666 1,838 $ 2,208 $ 2,573 $ $ $ $ 2003 2002 2001 $ $5 $ Revenues $ 3,056 $ 20,895 $ 20,012 Operating expenses 453 3,618 4,674 Other income - 3 16 Income before minority interest and taxes $ 2,603 $ 17,280 $ 15,354 Minority interests (773) (5,200) (4,526) Sale of partnership interest 34,973 - - Income taxes (14,414) (4,668) (4,150) Net income from discontinued operations $ 22,389 $ 7,412 $ 6,678 (in thousands) 23 ■  2003 ANNUAL REPORT SHENANDOAH TELECOMMUNICATIONS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS