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(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: i(773)i399-8900
Not Applicable
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
i☐
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
i☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
i☐
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
i☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities
registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol
Name of each exchange on which registered
iCommon Shares, $1 par value
iUSM
iNew
York Stock Exchange
i6.95% Senior Notes due 2060
iUZA
iNew
York Stock Exchange
i6.25% Senior Notes due 2069
iUZD
iNew
York Stock Exchange
i5.50% Senior Notes due 2070
iUZE
iNew
York Stock Exchange
i5.50% Senior Notes due 2070
iUZF
iNew
York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
i☐
Emerging
growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 1.01. Entry
into a Material Definitive Agreement
As previously disclosed, on March 2, 2020, United States Cellular Corporation (UScellular) entered into a $300,000,000 Credit Agreement by and among UScellular as Borrower, Toronto Dominion (Texas) LLC, as Administrative Agent, and the other lenders party thereto and identified therein (Existing Credit Agreement). On July 20, 2021 (the Effective Date), the Existing Credit Agreement was amended and restated in its entirety (First Amended and Restated Credit Agreement).
The First Amended and Restated Credit Agreement provides UScellular with a $300,000,000 senior revolving credit facility for general corporate purposes, including working capital and capital expenditures.
The following
briefly describes the terms of the First Amended and Restated Credit Agreement:
Borrowings under the First Amended and Restated Credit Agreement bear interest either at a LIBOR rate (subject to customary LIBOR replacement protocols) or at an alternative base rate, plus an applicable margin. UScellular’s interest costs under the First Amended and Restated Credit Agreement are based on credit ratings from Standard & Poor’s Rating Services, Moody’s Investor Services and/or Fitch Ratings. If UScellular’s credit ratings were lowered, the credit facility would not cease to be available solely as a result of a decline in its credit ratings.
The two financial covenants described below are included in the First Amended and Restated Credit Agreement:
1.Consolidated
Interest Coverage Ratio (the ratio of Consolidated EBITDA to Consolidated Interest Charges) may not be less than 3.00 to 1.00 as of the end of any fiscal quarter.
2.Consolidated Leverage Ratio (the ratio of Consolidated Funded Indebtedness to Consolidated EBITDA) may not be greater than 3.75 to 1.00 as of the end of any fiscal quarter.
The First Amended and Restated Credit Agreement is unsecured, subject to certain limitations. Additionally, certain wholly-owned subsidiaries are guarantors under the First Amended and Restated Credit Agreement.
The First Amended and Restated Credit Agreement includes representations and warranties, covenants, events of default and
other terms and conditions that are substantially similar to UScellular’s Existing Credit Agreement.
A Change in Control, as such term is defined in the First Amended and Restated Credit Agreement, of TDS (as defined below) or UScellular would constitute a default and would enable the required lenders and the Administrative Agent to require all borrowings outstanding under the First Amended and Restated Credit Agreement to be repaid.
The continued availability of the First Amended and Restated Credit Agreement requires UScellular to comply with certain negative and affirmative covenants, maintain the above financial ratios and provide representations on certain matters at the time of each borrowing.
Amounts under the First Amended and Restated Credit Agreement may be borrowed, repaid
and reborrowed from time to time from and after the Effective Date until the maturity date. There are no outstanding borrowings under the Revolving Credit Agreement as of the Effective Date, except for letters of credit.
Amounts borrowed under the First Amended and Restated Credit Agreement will be due and payable in full on the fifth anniversary of the Effective Date.
The foregoing brief description is qualified by reference to the copy of the First Amended and Restated Credit Agreement attached hereto as Exhibit 4.1, which is incorporated herein by reference, and which identifies all the lenders thereto.
Some of the lenders and/or agents under the First Amended
and Restated Credit Agreement and/or their affiliates may have various relationships with UScellular, its parent, Telephone and Data Systems, Inc. (TDS), and their subsidiaries involving banking or other financial services, including checking, cash management, brokerage, lending, investment banking, depository, indenture trustee and/or other services, including serving as a lender under the First Amended and Restated Credit Agreement or other TDS and/or UScellular credit agreements.
In connection with the First Amended and Restated Credit Agreement, UScellular and TDS entered into a Subordination Agreement dated the Effective Date together with Toronto Dominion (Texas) LLC, as Administrative Agent. Pursuant to the First Amended and
Restated Credit Agreement and this Subordination Agreement, (a) any consolidated funded indebtedness from UScellular to TDS will be unsecured and (b) any consolidated funded indebtedness, will be subordinated and made junior in right of payment to the prior payment in full of obligations to the lenders under the First Amended and Restated Credit Agreement. As of the date of this Form 8-K, there is no outstanding funded indebtedness of UScellular that is subordinated pursuant to the Subordination Agreement. The form of the Subordination Agreement is attached as an exhibit to the First Amended and Restated Credit Agreement attached hereto as Exhibit 4.1.
Item 2.03. Creation
of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
The disclosure set forth above under Item 1.01 is hereby incorporated by reference into this Item 2.03.
Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
