US Cellular 2015 Annual Report Download - page 41

12MAR201601533026
At December 31, 2015, TDS’ consolidated cash and
cash equivalents totaled $984.6 million. The majority of
TDS’ Cash and cash equivalents was held in bank
deposit accounts and in money market funds that invest
exclusively in U.S. Treasury Notes or in repurchase
agreements fully collateralized by such obligations. TDS
monitors the financial viability of the money market funds
and direct investments in which it invests and believes
that the credit risk associated with these investments is
low.
$0
$200
$400
$600
$800
$1,000
$1,200
2013 2014 2015
U.S. Cellular
TDS Telecom , TDS
Corporate & Other
Financing
Revolving Credit Facilities
TDS (exclusive of facilities held by U.S. Cellular) and U.S. Cellular have revolving credit facilities available for general
corporate purposes including spectrum purchases and capital expenditures, with a maximum borrowing capacity of
$400 million and $300 million, respectively. As of December 31, 2015, the unused capacity under these agreements was
$399.4 million and $282.5 million, respectively. Neither TDS nor U.S. Cellular borrowed or repaid any cash amounts
under their revolving credit facilities in 2015, and had no cash borrowings outstanding under their revolving credit
facilities as of December 31, 2015. The continued availability of the revolving credit facilities requires TDS and 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. TDS and U.S. Cellular believe that they were in
compliance as of December 31, 2015 with all of the financial and other covenants and requirements set forth in their
revolving credit facilities.
See Note 11 — Debt in the Notes to Consolidated Financial Statements for additional information regarding the revolving
credit facilities.
Term Loan
In January 2015, U.S. Cellular entered into a senior term loan credit facility. In July 2015, U.S. Cellular borrowed the full
amount of $225 million available under this facility in two separate draws. Principal reductions will be due and payable in
quarterly installments of $2.8 million beginning in March 2016 through December 2021, and the remaining unpaid
balance will be due and payable in January 2022. This facility was entered into for general corporate purposes, including
working capital, spectrum purchases and capital expenditures.
The continued availability of the term loan 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, that are substantially the same as those in the U.S. Cellular revolving credit facility described above. TDS
believes that U.S. Cellular was in compliance at December 31, 2015 with all of the financial and other covenants and
requirements set forth in the term loan facility.
See Note 11 — Debt in the Notes to Consolidated Financial Statements for additional information.
Financial Covenants
As noted above, The TDS and U.S. Cellular revolving credit facilities and the U.S. Cellular senior term loan facility require
TDS or U.S. Cellular, as applicable, to comply with certain affirmative and negative covenants, including certain financial
covenants. In particular, under these agreements, as amended, beginning July 1, 2014, TDS and U.S. Cellular are
required to maintain the Consolidated Leverage Ratio at a level not to exceed 3.75 to 1.00 for the period of the four
fiscal quarters most recently ended (this was 3.00 to 1.00 prior to July 1, 2014). The maximum permitted Consolidated
33
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
TDS Cash and Cash Equivalents
(Dollars in millions)