UNITED STATES CELLULAR CORPORATION (a Delaware corporation) Debt Securities TERMS AGREEMENT
Exhibit 1.2
UNITED STATES CELLULAR CORPORATION
(a Delaware corporation)
Debt Securities
TERMS AGREEMENT
May 9, 2011
To: United States Cellular Corporation
8410 West Bryn Mawr Avenue, Suite 700
Chicago, Illinois 60631
Ladies and Gentlemen:
We understand that United States Cellular Corporation, a Delaware corporation (the “Company”), proposes to issue and sell $300,000,000 aggregate principal amount of its senior debt securities (the “Securities”) (such securities also being hereinafter referred to as the “Initial Underwritten Securities”). Subject to the terms and conditions set forth or incorporated by reference herein, we the underwriters named below (the “Underwriters”) offer to purchase, severally and not jointly, the principal amount of Initial Underwritten Securities opposite their names set forth below at the purchase price set forth below, and a proportionate share of Option Underwritten Securities set forth below, to the extent any are purchased.
| Underwriters |
| Principal Amount |
| |
| Citigroup Global Markets Inc. |
| $ | 58,875,000 |
|
| Merrill Lynch, Pierce, Fenner & Smith Incorporated |
| 58,875,000 |
| |
| UBS Securities LLC |
| 58,875,000 |
| |
| Wells Fargo Securities, LLC |
| 58,875,000 |
| |
| RBC Capital Markets, LLC |
| 15,000,000 |
| |
| BNY Mellon Capital Markets, LLC |
| 6,000,000 |
| |
| Comerica Securities, Inc. |
| 6,000,000 |
| |
| SunTrust Robinson Humphrey, Inc. |
| 6,000,000 |
| |
| TD Securities (USA) LLC |
| 6,000,000 |
| |
| U.S. Bancorp Investments, Inc. |
| 6,000,000 |
| |
| Ameriprise Financial Services, Inc. |
| 1,500,000 |
| |
| BB&T Capital Markets, a division of Scott & Stringfellow, LLC |
| 1,500,000 |
| |
| Janney Montgomery Scott LLC |
| 1,500,000 |
| |
| Keefe, Bruyette & Woods, Inc. |
| 1,500,000 |
| |
| Morgan Keegan & Company, Inc. |
| 1,500,000 |
| |
| Oppenheimer & Co. Inc. |
| 1,500,000 |
| |
| Robert W. Baird & Co. Incorporated |
| 1,500,000 |
| |
| Stifel, Nicolaus & Company, Incorporated |
| 1,500,000 |
| |
| B.C. Ziegler and Co. |
| 750,000 |
| |
| Blaylock Robert Van, LLC |
| 750,000 |
| |
| Cabrera Capital Markets, LLC |
| 750,000 |
| |
| CastleOak Securities, L.P. |
| 750,000 |
| |
| D.A. Davidson & Co. |
| 750,000 |
| |
| Davenport & Company LLC |
| 750,000 |
| |
| JJB Hilliard, WL Lyons, Inc. |
| 750,000 |
| |
| KeyBanc Capital Markets Inc. |
| 750,000 |
| |
| Samuel A. Ramirez & Company, Inc. |
| 750,000 |
| |
| The Williams Capital Group, L.P. |
| 750,000 |
| |
|
|
|
|
| |
| Total |
| $ | 300,000,000 |
|
The Underwritten Securities shall have the following terms:
Debt Securities
| Title: |
| 6.95% Senior Notes due 2060 |
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| Rank: |
| Senior unsecured obligations of the Company |
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| Aggregate principal amount of Initial Underwritten Securities: |
| $300,000,000 |
|
|
|
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| Option Underwritten Securities: |
| $42,000,000 |
|
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|
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| Denominations: |
| $25 and integral multiples of $25 in excess thereof |
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| Currency of payment: |
| US Dollars |
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| Interest rate: |
| 6.95% per annum |
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| Interest payment dates: |
| March 15, June 15, September 15 and December 15, commencing June 15, 2011 |
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| Regular record dates: |
| The first business day preceding the respective interest payment date |
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| Stated maturity date: |
| May 15, 2060 |
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| Redemption provisions: |
| The Notes may be redeemed, in whole or in part, at the Company’s option at any time on and after May 15, 2016 at a redemption price equal to 100% of the principal amount of the Notes being redeemed plus accrued and unpaid interest to the redemption date |
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| Sinking fund requirements: |
| None |
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| Conversion provisions: |
| None |
2
| Listing requirements: |
| NYSE within 30 days of settlement date |
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| CUSIP / ISIN: |
| 911684 405/ US9116844054 |
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| Black-out provisions: |
| May 9, 2011 through May 16, 2011 |
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| Price to Public: |
| $25 per Note; 100% of the principal amount, plus accrued interest, if any, from May 16, 2011 |
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| Purchase price: |
| $24.2125 per Note; 96.85% of principal amount, plus accrued interest, if any, from May 16, 2011 |
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| Form: |
| Book-entry only |
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| Other terms and conditions: |
| None |
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| Initial Sale Time: |
| 4:00 P.M., New York City time, on May 9, 2011 |
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| Free writing prospectus included in Disclosure Package (See Section 1(a)(2)): |
| Free writing prospectus, dated May 9, 2011 |
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| Electronic road show or other written communications included in Company Additional Written Communication (See Section 1(a)(6)): |
| None |
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| Closing date and location: |
| May 16, 2011 at the offices of Sidley Austin LLP, One S. Dearborn Street, Chicago, Illinois 60603 |
All of the provisions contained in the document attached as Annex I hereto entitled “UNITED STATES CELLULAR CORPORATION — Debt Securities — Final Term Sheet” as was filed with the Securities and Exchange Commission on May 9, 2011, and the document attached as Annex II hereto entitled “UNITED STATES CELLULAR CORPORATION — Debt Securities — Underwriting Agreement” are hereby incorporated by reference in their entirety herein and shall be deemed to be a part of this Terms Agreement to the same extent as if such provisions had been set forth in full herein. Terms defined in such document are used herein as therein defined.
3
Please accept this offer no later than 4:00 o’clock P.M. (New York City time) on May 9, 2011 by signing a copy of this Terms Agreement in the space set forth below and returning the signed copy to us.
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| Very truly yours, | |
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| |
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| CITIGROUP GLOBAL MARKETS INC. MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED | |
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| UBS SECURITIES LLC | |
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| WELLS FARGO SECURITIES, LLC | |
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| As Representatives of the Several Underwriters Referred to Below | |
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| BY: WELLS FARGO SECURITIES, LLC | |
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| By: | /s/ Carolyn Hurley |
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| Authorized Signatory |
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| Acting on behalf of itself and the other named Underwriters. | |
| Accepted: |
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| UNITED STATES CELLULAR CORPORATION |
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| By |
| /s/ LeRoy T. Carlson, Jr. |
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| Name: | LeRoy T. Carlson, Jr. |
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| Title: | Chairman |
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| By | /s/ Kenneth R. Meyers |
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| Name: | Kenneth R. Meyers |
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| Title: | Chief Accounting Officer |
| |
[Signature Page to the Terms Agreement]
Annex I to Terms Agreement
Form of Pricing Term Sheet
Free Writing Prospectus
(To Prospectus dated May 9, 2011 and
Preliminary Prospectus Supplement Dated May 9, 2011)
$300,000,000
United States Cellular Corporation
6.95% Senior Notes due 2060
Pricing Term Sheet
| Issuer: | United States Cellular Corporation |
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| Security: | 6.95% Senior Notes due 2060 |
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| Principal Amount: | $300,000,000 |
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| Over-Allotment Option: | $42,000,000 |
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| Denominations: | $25 and integral multiples of $25 in excess thereof |
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| Trade Date: | May 9, 2011 |
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| Settlement Date: | May 16, 2011 (T+5) |
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| Maturity Date: | May 15, 2060 |
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| Coupon: | 6.95% |
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| Interest Payment Dates: | March 15, June 15, September 15 and December 15, commencing June 15, 2011 |
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| Price to Public: | $25 per note |
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| Optional Redemption: | The Issuer may redeem the Notes, in whole or in part, at any time on and after May 15, 2016 at a redemption price equal to 100% of the principal amount redeemed plus accrued and unpaid interest to the redemption date. |
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| Use of Proceeds: | The Issuer expects to use the net proceeds from the offering to redeem some or all of its 7.50% Senior Notes due 2034, of which $330 million in aggregate principal amount is outstanding. Any remaining net proceeds will be used for general corporate purposes. |
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| Listing: | The Issuer intends to list the Notes on the New York Stock Exchange and expects trading in the Notes on the New York Stock Exchange to begin within 30 days after the |
A-I-1
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| Settlement Date. |
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| CUSIP/ISIN: | 911684 405/ US9116844054 |
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| Joint Book-Running Managers: | Citigroup Global Markets Inc. Merrill Lynch, Pierce, Fenner & Smith Incorporated UBS Securities LLC |
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| Wells Fargo Securities, LLC |
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| Co-Managers: | RBC Capital Markets, LLC BNY Mellon Capital Markets, LLC Comerica Securities, Inc. SunTrust Robinson Humphrey, Inc. TD Securities (USA) LLC U.S. Bancorp Investments, Inc. |
The issuer has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering.
You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling Citigroup Global Markets Inc. toll-free at ###-###-#### or e-mail ***@***; or Merrill Lynch, Pierce, Fenner & Smith Incorporated toll-free at ###-###-#### or e-mail ***@***; or UBS Securities LLC toll-free at ###-###-####, extension ###-###-####; or Wells Fargo Securities, LLC toll-free at ###-###-#### or e-mail ***@***.
A-I-2
Annex II to Terms Agreement
UNITED STATES CELLULAR CORPORATION
Underwriting Agreement
[see attached]
