Form 8-K UNITED STATES CELLULAR For: Nov 23

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

 

Date of report (Date of earliest event reported): November 23, 2015

 

UNITED STATES CELLULAR CORPORATION

(Exact Name of Registrant as Specified in its Charter)

 

 

 

Registrant’s telephone number, including area code:  (773) 399-8900

 

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:

 

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o            Pre-commencement communications pursuant to rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

Item 1.01.  Entry into a Material Definitive Agreement.

 

United States Cellular Corporation (the “Company”) previously disclosed the sale on November 16, 2015 of $300,000,000 aggregate principal amount of the Company’s 7.25% Senior Notes due 2064 (the “Notes”).  The Notes will be our senior unsecured obligations and will rank on a parity with all of our existing and future senior unsecured obligations.

 

The closing and settlement of the sale of $300,000,000 aggregate principal amount of Notes occurred on November 23, 2015.  The Notes were issued pursuant to an Indenture dated as of June 1, 2002 (the “Indenture”) between the Company and The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A., as successor to BNY Midwest Trust Company), as trustee (the “Trustee”), as supplemented by the Eighth Supplemental Indenture dated November 23, 2015 (the “Eighth Supplemental Indenture”).

 

The Indenture was incorporated as Exhibit 4.1 to the Company’s Registration Statement on Form S-3 (Registration No. 333-202271) and is incorporated herein by reference thereto.  The form of the Eighth Supplemental Indenture, including the form of the Notes, was filed as Exhibit 2 to the Company’s Registration Statement on Form 8-A dated and filed on November 17, 2015 and is incorporated herein by reference.  A description of the Indenture, the Eighth Supplemental Indenture and the Notes is included in the Company’s Prospectus Supplement and Prospectus dated November 16, 2015 and filed on November 17, 2015, which descriptions are incorporated by reference herein.

 

The foregoing description does not purport to be complete and is qualified in its entirety by reference to the respective documents incorporated by reference herein.

 

The Trustee is an affiliate of The Bank of New York Mellon Corp., which is one of a number of banks with which the Company and its subsidiaries maintain ordinary banking relationships, including, in certain cases, credit facilities.

Item 8.01.  Other Events.

 

A copy of the opinion of Sidley Austin LLP relating to the legality of the Notes to be issued and sold in the offering is filed as Exhibit 5.1 hereto.

 

Item 9.01.  Financial Statements and Exhibits.

 

(d)           Exhibits:

 

In accordance with the provisions of Item 601 of Regulation S-K, any Exhibits included in this Form 8-K are identified on the Exhibit Index attached hereto.

 

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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.

 

 

	UNITED STATES CELLULAR CORPORATION
Date: November 23, 2015	By:	/s/ Steven T. Campbell
		Steven T. Campbell
		Executive Vice President – Finance,
		Chief Financial Officer and Treasurer
		(principal financial officer)

 

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EXHIBIT INDEX

 

The following exhibits are filed herewith as noted below.

 

Exhibit
No.		Description
4.1		Indenture dated as of June 1, 2002 between the Registrant and The Bank of New York Mellon Trust Company, N.A. (formerly known as the Bank of New York Trust Company, N.A., as successor to BNY Midwest Trust Company), is hereby incorporated by reference from Exhibit 4.1 to the Company’s Registration Statement on Form S-3 (Registration No. 333-202271).
4.2		Eighth Supplemental Indenture dated as of November 23, 2015 between the Company and The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A., as successor to BNY Midwest Trust Company), the form of which is hereby incorporated by reference from Exhibit 2 to the Company’s Registration Statement on Form 8-A dated and filed on November 17, 2015.
5.1		Opinion of Sidley Austin LLP relating to legality of the Notes.
23.1		Consent of Sidley Austin LLP (included as part of Exhibit 5.1).
99.1		Private Securities Litigation Reform Act of 1995 Safe Harbor Cautionary Statement

 

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Exhibit 5.1

 

		SIDLEY AUSTIN LLP ONE SOUTH DEARBORN STREET CHICAGO, IL 60603 (312) 853 7000 (312) 853 7036 FAX		BEIJING BOSTON BRUSSELS CENTURY CITY CHICAGO DALLAS GENEVA		HONG KONG HOUSTON LONDON LOS ANGELES NEW YORK PALO ALTO SAN FRANCISCO	SHANGHAI SINGAPORE SYDNEY TOKYO WASHINGTON, D.C.
				FOUNDED 1866

 

November 23, 2015

 

United States Cellular Corporation

8410 West Bryn Mawr

Chicago, IL 60631

 

Re:                             Registration Statement on Form S-3

 

Ladies and Gentlemen:

 

We refer to the Registration Statement on Form S-3, File No. 333-202271 (the “Registration Statement”), filed by United States Cellular Corporation, a Delaware corporation (the “Company”), with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Securities Act”), which Registration Statement was declared effective on May 8, 2015.  Pursuant to the Registration Statement, the Company is issuing $300,000,000 aggregate principal amount of the Company’s 7.25% Senior Notes due 2064 (the “Securities”). The Securities are being issued under an Indenture dated June 1, 2002 (the “Base Indenture”), as amended and supplemented, including by the First Supplemental Indenture dated August 7, 2002, the Second Supplemental Indenture dated October 31, 2002, the Third Supplemental Indenture dated December 3, 2003, the Fourth Supplemental Indenture dated June 9, 2004, the Fifth Supplemental Indenture dated June 21, 2004, the Sixth Supplemental Indenture dated May 9, 2011, the Seventh Supplemental Indenture dated December 8, 2014 and the Eighth Supplemental Indenture dated as of the date hereof (the Base Indenture, as so supplemented, the “Indenture”), each between the Company and The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A., as successor to BNY Midwest Trust Company), as trustee (the “Trustee”).  The Securities are to be sold by the Company pursuant to the Underwriting Agreement dated November 16, 2015 (the “Underwriting Agreement”) among the Company and Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co. LLC, RBC Capital Markets, LLC, UBS Securities LLC and Wells Fargo Securities, LLC, as representatives of the several underwriters named in the related Terms Agreement dated November 16, 2015 (the “Terms Agreement”) relating to the issuance and sale of the Securities.

 

This opinion letter is being delivered in accordance with the requirements of Item 601(b)(5) of Regulation S-K under the Securities Act.

 

We have examined (i) the Registration Statement, (ii) the Company’s prospectus dated November 16, 2015 included in the Registration Statement (the “Base Prospectus”), (iii) the

 

Sidley Austin LLP is a limited liability partnership practicing in affiliation with other Sidley Austin partnerships.

 

 

Company’s prospectus supplement dated November 16, 2015 supplementing the Base Prospectus and relating to the Securities, (iv) the Indenture, (v) the Securities in global form, (vi) the Underwriting Agreement and the Terms Agreement, (vii) certain resolutions of the Board of Directors of the Company adopted on May 6, 2002, December 11, 2012, June 21, 2013, August 15, 2013 and November 18, 2014 and of the Pricing Committee of the Board of Directors of the Company duly adopted on May 28, 2013 and  November 16, 2015, as certified by the Secretary of the Company on November 16, 2015 as being true, complete and correct and in full force and effect, relating to, among other things, the Registration Statement, the Indenture, the Underwriting Agreement, the Terms Agreement and the issuance and sale of the Securities, and (viii) the Restated Certificate of Incorporation of the Company and the Restated Bylaws of the Company, in each case as currently in effect, and as certified by the Secretary of the Company on the date hereof as being true, complete and correct and in full force and effect.  We have also examined originals, or copies of originals certified to our satisfaction, of such agreements, documents, certificates and statements of the Company and other corporate documents and instruments, and have examined such questions of law and have satisfied ourselves as to such matters of fact, as we have considered relevant and necessary as a basis for this opinion letter.  We have assumed the authenticity of all documents submitted to us as originals, the genuineness of all signatures, the legal capacity of all persons and the conformity with the original documents of any copies thereof submitted to us for examination. As to facts  relevant to the opinions expressed herein, we have relied without independent investigation or verification upon, and assumed the accuracy and completeness of, certificates, letters and oral and written statements and representations of public officials and officers and other representatives of the Company.

 

Based on and subject to the foregoing and the other limitations, qualifications and assumptions set forth herein, we are of the opinion that the Securities will constitute valid and binding obligations of the Company when the Securities are duly executed by duly authorized officers of the Company and duly authenticated by the Trustee, all in accordance with the provisions of the Indenture, and delivered to the purchasers thereof against payment of the agreed consideration therefor in accordance with the Underwriting Agreement and the related Terms Agreement.

 

Our opinion is subject to bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, fraudulent transfer and other similar laws relating to or affecting creditors’ rights generally and to general equitable principles (regardless of whether considered in a proceeding in equity or at law), including concepts of commercial reasonableness, good faith and fair dealing and the possible unavailability of specific performance or injunctive relief.

 

This opinion letter is limited to the General Corporation Law of the State of Delaware and the laws of the State of Illinois (excluding the securities laws of the State of Illinois).  We express no opinion as to the laws, rules or regulations of any other jurisdiction, including,

 

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without limitation, the federal laws of the United States of America or any state securities or blue sky laws.

 

The Company is controlled by Telephone and Data Systems, Inc. (“TDS”).  The following persons are partners in this Firm:  Walter C.D. Carlson, a trustee and beneficiary of a voting trust that controls TDS, the non-executive chairman of the board and member of the board of directors of TDS and a director of the Company; William S. DeCarlo, the General Counsel of TDS and an Assistant Secretary of TDS and certain subsidiaries of TDS; and Stephen P. Fitzell, the General Counsel and/or an Assistant Secretary of the Company and certain other subsidiaries of TDS.

 

We hereby consent to the filing of this opinion letter as an exhibit to the Company’s Current Report on Form 8-K on the date hereof, which Form 8-K will be incorporated by reference into the Registration Statement, and to all references to our Firm included in or made a part of the Registration Statement.  In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act.

 

	Very truly yours,
	/s/ Sidley Austin LLP

 

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Exhibit 99.1

 

PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

SAFE HARBOR CAUTIONARY STATEMENT

 

This Form 8-K and/or press release attached to this Form 8-K contain statements that are not based on historical facts and represent forward-looking statements, as this term is defined in the Private Securities Litigation Reform Act of 1995.  All statements, other than statements of historical facts, that address activities, events or developments that U.S. Cellular intends, expects, projects, believes, estimates, plans or anticipates will or may occur in the future are forward-looking statements.  The words “believes,” “anticipates,” “estimates,” “expects,” “plans,” “intends,” “projects” and similar expressions are intended to identify these forward-looking statements, but are not the exclusive means of identifying them. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, events or developments to be significantly different from any future results, events or developments expressed or implied by such forward-looking statements.  Such risks, uncertainties and other factors include those set forth below, as more fully discussed under “Risk Factors” in the most recent filing of U.S. Cellular’s Form 10-K, as updated by any U.S. Cellular Form 10-Q filed subsequent to such Form 10-K.  However, such factors are not necessarily all of the important factors that could cause actual results, performance or achievements to differ materially from those expressed in, or implied by, the forward-looking statements contained in this document.  Other unknown or unpredictable factors also could have material adverse effects on future results, performance or achievements.  U.S. Cellular undertakes no obligation to update publicly any forward-looking statements whether as a result of new information, future events or otherwise.   You should carefully consider the Risk Factors in the most recent filing of U.S. Cellular’s Form 10-K, as updated by any U.S. Cellular Form 10-Q filed subsequent to such Form 10-K, the following factors and other information contained in, or incorporated by reference into, this Form 8-K and/or press release attached to this Form 8-K to understand the material risks relating to U.S. Cellular’s business.

 

·                  Intense competition in the markets in which U.S. Cellular operates could adversely affect U.S. Cellular’s revenues or increase its costs to compete.

 

·                  A failure by U.S. Cellular to successfully execute its business strategy (including planned acquisitions, divestitures and exchanges) or allocate resources or capital could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  U.S. Cellular offers customers the option to purchase certain devices under installment contracts, which creates certain risks and uncertainties which could have an adverse impact on U.S. Cellular’s financial condition or results of operations.

 

·                  Changes in roaming practices or other factors could cause U.S. Cellular’s roaming revenues to decline from current levels and/or impact U.S. Cellular’s ability to service its customers in geographic areas where U.S. Cellular does not have its own network, which could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  A failure by U.S. Cellular to obtain access to adequate radio spectrum to meet current or anticipated future needs and/or to accurately predict future needs for radio spectrum could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  To the extent conducted by the Federal Communications Commission (“FCC”), U.S. Cellular is likely to participate in FCC auctions of additional spectrum in the future as an applicant or as a noncontrolling partner in another auction applicant and, during certain periods, will be subject to the FCC’s anti-collusion rules, which could have an adverse effect on U.S. Cellular.

 

·                  Changes in the regulatory environment or a failure by U.S. Cellular to timely or fully comply with any applicable regulatory requirements could adversely affect U.S. Cellular’s business, financial condition or results of operations.

 

·                  An inability to attract people of outstanding potential, to develop their potential through education and assignments, and to retain them by keeping them engaged, challenged and properly rewarded could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  U.S. Cellular’s assets are concentrated in the U.S. wireless telecommunications industry. As a result, its results of operations may fluctuate based on factors related primarily to conditions in this industry.

 

·                  U.S. Cellular’s lower scale relative to larger competitors could adversely affect its business, financial condition or results of operations.

 

 

·                  Changes in various business factors could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  Advances or changes in technology could render certain technologies used by U.S. Cellular obsolete, could put U.S. Cellular at a competitive disadvantage, could reduce U.S. Cellular’s revenues or could increase its costs of doing business.

 

·                  Complexities associated with deploying new technologies present substantial risk.

 

·                  U.S. Cellular is subject to numerous surcharges and fees from federal, state and local governments, and the applicability and the amount of these fees are subject to great uncertainty.

 

·                  Performance under device purchase agreements could have a material adverse impact on U.S. Cellular’s business, financial condition or results of operations.

 

·                  Changes in U.S. Cellular’s enterprise value, changes in the market supply or demand for wireless licenses, adverse developments in the business or the industry in which U.S. Cellular is involved and/or other factors could require U.S. Cellular to recognize impairments in the carrying value of its licenses, goodwill and/or physical assets.

 

·                  Costs, integration problems or other factors associated with acquisitions, divestitures or exchanges of properties or licenses and/or expansion of U.S. Cellular’s business could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  U.S. Cellular’s investments in unproven technologies may not produce the benefits that U.S. Cellular expects.

 

·                  A failure by U.S. Cellular to complete significant network construction and systems implementation activities as part of its plans to improve the quality, coverage, capabilities and capacity of its network, support and other systems and infrastructure could have an adverse effect on its operations.

 

·                  Difficulties involving third parties with which U.S. Cellular does business, including changes in U.S. Cellular’s relationships with or financial or operational difficulties of key suppliers or independent agents and third party national retailers who market U.S. Cellular services, could adversely affect U.S. Cellular’s business, financial condition or results of operations.

 

·                  U.S. Cellular has significant investments in entities that it does not control. Losses in the value of such investments could have an adverse effect on U.S. Cellular’s financial condition or results of operations.

 

·                  A failure by U.S. Cellular to maintain flexible and capable telecommunication networks or information technology, or a material disruption thereof, could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  U.S. Cellular has experienced and, in the future, expects to experience cyber-attacks or other breaches of network or information technology security of varying degrees on a regular basis, which could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  The market price of U.S. Cellular’s Common Shares is subject to fluctuations due to a variety of factors.

 

·                  Changes in facts or circumstances, including new or additional information, could require U.S. Cellular to record charges in excess of amounts accrued in the financial statements, which could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  Disruption in credit or other financial markets, a deterioration of U.S. or global economic conditions or other events could, among other things, impede U.S. Cellular’s access to or increase the cost of financing its operating and investment activities and/or result in reduced revenues and lower operating income and cash flows, which would have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  Uncertainty of U.S. Cellular’s ability to access capital, deterioration in the capital markets, other changes in market conditions, changes in U.S. Cellular’s credit ratings or other factors could limit or restrict the availability of financing on terms and prices acceptable to U.S. Cellular, which could require U.S. Cellular to reduce its construction, development or acquisition programs.

 

 

·                  Settlements, judgments, restraints on its current or future manner of doing business and/or legal costs resulting from pending and future litigation could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  The possible development of adverse precedent in litigation or conclusions in professional studies to the effect that radio frequency emissions from wireless devices and/or cell sites cause harmful health consequences, including cancer or tumors, or may interfere with various electronic medical devices such as pacemakers, could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  Claims of infringement of intellectual property and proprietary rights of others, primarily involving patent infringement claims, could prevent U.S. Cellular from using necessary technology to provide products or services or subject U.S. Cellular to expensive intellectual property litigation or monetary penalties, which could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

 

·                  There are potential conflicts of interests between TDS and U.S. Cellular.

 

·                  Certain matters, such as control by TDS and provisions in the U.S. Cellular Restated Certificate of Incorporation, may serve to discourage or make more difficult a change in control of U.S. Cellular.

 

·                  Any of the foregoing events or other events could cause revenues, earnings, capital expenditures and/or any other financial or statistical information to vary from U.S. Cellular’s forward-looking estimates by a material amount.