Item 1.02.Termination of Material Definitive Agreement. This information in this Item 1.02 is being filed within four business days of December 23, 2005 to report the termination on such date of the Intercompany Revolving Credit Agreement dated November 9, 2005, ("Intercompany Revolving Credit Agreement"), between Telephone and Data Systems, Inc. ("TDS"), as Lender, and United States Cellular Corporation ("U.S. Cellular"), as Borrower. The following describes the background of this agreement and the facts that resulted in its termination. As previously disclosed, on November 9, 2005, TDS and U.S. Cellular and their respective audit committees concluded that they would amend their Annual Reports on Form 10-K for the year ended December 31, 2004 to restate their financial statements and financial information for each of the three years ended December 31, 2004, including quarterly information for 2004 and 2003, and certain selected financial data for the years 2001 and 2000. TDS and U.S. Cellular and their respective audit committees also concluded that they would amend their Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2005 and June 30, 2005 to restate the financial statements and financial information included therein. As a result, TDS and U.S. Cellular were unable to file their Forms 10-Q for the quarter ended September 30, 2005 by the extended due date of November 14, 2005. Also as previously disclosed, the restatements and the late filing of the Forms 10-Q resulted in technical defaults under the Amended and Restated Revolving Credit Agreement dated December 9, 2004 between TDS and certain lenders (the "TDS Revolving Credit Agreement"), and the Amended and Restated Revolving Credit Agreement dated December 9, 2004 between U.S. Cellular and certain lenders (the "U.S. Cellular Revolving Credit Agreement"). As a result, TDS and U.S. Cellular became unable to make borrowings under the TDS Revolving Credit Agreement and the U.S. Cellular Revolving Credit Agreement (collectively, the "Bank Revolving Credit Agreements") until they received waivers of such defaults. Due to the unavailability of the Bank Revolving Credit Agreements, on November 9, 2005, TDS and U.S. Cellular entered into the Intercompany Revolving Credit Agreement in order to permit U.S. Cellular to borrow funds from TDS for U.S. Cellular's financing requirements until such waivers were received from the lenders under the Bank Revolving Credit Agreements. On December 23, 2005, TDS and U.S. Cellular obtained waivers from the lenders under such Bank Revolving Credit Agreements. As a result of the receipt of such waivers, TDS and U.S. Cellular became able to make borrowings under such Bank Revolving Credit Agreements. On December 23, 2005, U.S. Cellular borrowed $145 million under U.S. Cellular Revolving Credit Agreement. The terms of the U.S. Cellular Revolving Credit Agreement are hereby incorporated by reference from U.S. Cellular's Form 8-K dated December 9, 2004, including Exhibit 4.1 to such Form 8-K which includes a copy of such U.S. Cellular Revolving Credit Agreement. U.S. Cellular used $40 million of such borrowings for general corporate purposes and used $105 million of such borrowings to repay the principal amount due to TDS under the Intercompany Revolving Credit Agreement. Pursuant to its terms, such Intercompany Revolving Credit Agreement was terminated as a result of the receipt of the aforementioned waivers and the repayment by U.S. Cellular of the outstanding borrowings on December 23, 2005. Accordingly, the Intercompany Revolving Credit Agreement is no longer in effect. The terms of the Intercompany Revolving Credit Agreement are hereby incorporated by reference from U.S. Cellular's Form 8-K dated November 9, 2005, including Exhibit 4.1 to such Form 8-K which includes a copy of such Intercompany Revolving Credit Agreement. Item 2.03.Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. The disclosures set forth above under Item 1.02 are hereby incorporated by reference into this Item 2.03 to report events on December 23, 2005 within four business days thereof. Item 8.01.Other Matters |
