TELEPHONE AND DATA SYSTEMS INC / DE /: Signing of a material definitive agreement, creation of a direct financial obligation or obligation under an off-balance sheet arrangement of a holder, financial statements and exhibits (Form 8 -K)

Item 1.01. Entry into a Material Definitive Agreement As previously disclosed, onMarch 2, 2020 ,Telephone and Data Systems, Inc. (TDS) entered into a$400,000,000 Credit Agreement by and among TDS as Borrower,Wells Fargo Bank, National Association , as Administrative Agent, and the other lenders party thereto and identified therein (Existing Credit Agreement). OnJuly 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 updated credit agreement gives TDS a
Senior revolving credit facility for general business purposes including working capital and capital expenditures.
The following briefly describes the terms of the Amended and Restated First 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. TDS' interest costs under the First Amended and Restated Credit Agreement are based on credit ratings fromStandard & Poor's Rating Services ,Moody's Investor Services and/or Fitch Ratings. If TDS' 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 updated credit agreement:
1. The consolidated interest coverage ratio (the ratio of consolidated EBITDA to consolidated interest expense) cannot be less than 3.00 to 1.00 at the end of a 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 not guaranteed, subject to certain restrictions. In addition, 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 TDS' Existing Credit Agreement.
A change of control, as that term is defined in the First Amended and Restated Credit Agreement, of TDS would constitute a default and allow the required lenders and the Administrative Agent to require that all outstanding borrowings under of the first amended and updated credit agreement be repaid.
The continued availability of the First Amended and Restated Credit Agreement requires TDS 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 outstanding borrowings of$125 million and letters of credit under the Existing Credit Agreement as of the Effective Date.
Amounts borrowed under the Existing Credit Agreement and the Amended and Restated First 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 TDS, its publicly-traded subsidiary,United States Cellular Corporation (UScellular), 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.
First Amended and Updated Credit Agreement by UScellular:
Also on
2021 , which Form 8-K is incorporated by reference herein. The terms and conditions of the UScellular First Amended and Restated Credit Agreement are described in such Form 8-K and are substantially similar to those of TDS' First Amended and Restated Credit Agreement. A copy of the UScellular First Amended and Restated Credit Agreement, including the forms of the related Guaranty and Subordination Agreement attached thereto, is incorporated by reference herein as Exhibit 4.2. --------------------------------------------------------------------------------
Article 2.03. Creation of a direct financial obligation or 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.
Item 9.01. Financial Statements and Exhibits (d) Exhibits Exhibit Number Description of Exhibits 4.1 First Amended and Restated Credit
Agreement, between TDS, Wells Fargo
National Association, as administrative
agent, and other lenders
thereto, dated as ofJuly 20, 2021 ,
including affiliate form
Guaranty. 4.2 First Amended and Restated Credit
Agreement, between UScellular,
Dominion (Texas) LLC , as administrative
agent, and other lenders
thereto, dated as ofJuly 20, 2021 ,
including affiliate form
Guaranty and Subordination Agreement, is hereby incorporated by reference to Exhibit 4.1 to UScellular's Current Report on Form 8-K datedJuly 20, 2021 . 104 Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.
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