US Cellular 2009 Annual Report Download - page 72

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UNITED STATES CELLULAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 13 DEBT (Continued)
The maturity date of any borrowings under U.S. Cellular’s new revolving credit facility would accelerate in
the event of a change in control.
The continued availability of the new revolving credit facility requires U.S. Cellular to comply with certain
negative and affirmative covenants, maintain certain financial ratios and make representations regarding
certain matters at the time of each borrowing. U.S. Cellular believes it was in compliance as of
December 31, 2009 with all covenants and other requirements set forth in its new revolving credit facility.
In connection with U.S. Cellular’s new revolving credit facility, TDS and U.S. Cellular entered into a
subordination agreement dated June 30, 2009 together with the administrative agent for the lenders
under U.S. Cellular’s new revolving credit agreement. Pursuant to this subordination agreement, (a) any
consolidated funded indebtedness from U.S. Cellular to TDS will be unsecured and (b) any
(i) consolidated funded indebtedness from U.S. Cellular to TDS (other than ‘‘refinancing indebtedness’’
as defined in the subordination agreement) in excess of $105,000,000, and (ii) refinancing indebtedness
in excess of $250,000,000, will be subordinated and made junior in right of payment to the prior payment
in full of obligations to the lenders under U.S. Cellular’s new revolving credit agreement. As of
December 31, 2009, U.S. Cellular had no outstanding consolidated funded indebtedness or refinancing
indebtedness that was subordinated to the revolving credit agreement pursuant to the subordination
agreement.
Long-Term Debt
Long-term debt at December 31, 2009 and 2008 was as follows:
December 31, 2009 2008
(Dollars in thousands)
6.7% senior notes maturing in 2033 .................... $544,000 $ 544,000
Unamortized discount .............................. (10,798) (11,252)
533,202 532,748
7.5% senior notes maturing in 2034 .................... 330,000 330,000
8.75% senior notes ................................ — 130,000
Obligation on capital leases ......................... 4,396 4,146
Other 9.0% ..................................... — 10,000
Total long-term debt ............................... 867,598 1,006,894
Less: Current portion of long-term debt ................. 76 10,258
Total long-term debt, excluding current portion ............ $867,522 $ 996,636
Unsecured Notes
The 6.7% senior notes are due December 15, 2033. Interest is paid semi-annually. U.S. Cellular may
redeem the notes, in whole or in part, at any time prior to maturity at a redemption price equal to the
greater of (a) 100% of the principal amount of such notes, plus accrued but unpaid interest, or (b) the
sum of the present values of the remaining scheduled payments of principal and interest thereon
discounted to the redemption date on a semi-annual basis at the Treasury Rate plus 30 basis points.
The 7.5% senior notes are due June 15, 2034. Interest on the notes is payable quarterly. U.S. Cellular
may redeem the notes, in whole or in part, at any time on or after June 17, 2009, at a redemption price
equal to 100% of the principal amount redeemed plus accrued and unpaid interest.
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