8-K

FORM 8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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 26, 2010

TELEPHONE AND DATA SYSTEMS, INC.

(Exact name of registrant as specified in their charter)

Delaware (State or other jurisdiction of incorporation)	001-14157 (Commission File Number)	36-2669023 (IRS Employer Identification No.)
30 North LaSalle Street, Suite 4000, Chicago, Illinois Address of principal executive offices)		60602 (Zip Code)

Registrant’s telephone number, including area code:  (312) 630-1900

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 (see General Instruction A.2. below):

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

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

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

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

Item 2.04                Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement.

To the extent required by Item 2.04 of Form 8-K, the information contained or incorporated in Item 8.01 of this Form 8-K is incorporated by reference in this Item 2.04.

Item 8.01                Other Events.

On November 26, 2010 Telephone and Data Systems, Inc. (“TDS”), called for redemption a portion of the outstanding 7.6% Series A Notes due 2041, CUSIP No. 879433878 (the “7.6% Notes”), of TDS.  TDS will redeem $217,500,000 aggregate principal amount of the outstanding $500,000,000 aggregate principal amount of such notes. The redemption price of the 7.6% Notes is 100% of the outstanding aggregate principal amount, plus accrued and unpaid interest thereon until the redemption date.  The redemption date will be December 27, 2010.  The 7.6% Notes are listed on the New York Stock Exchange (“NYSE”) under the symbol “TDA.” 

The 7.6% Notes were issued and the redemption will be effected pursuant to the provisions of the Indenture dated November 1, 2001 (“Indenture”) between U.S. Cellular and The Bank of New York Mellon Trust Company, N.A., f/k/a The Bank of New York Trust Company, N.A., as successor to BNY Midwest Trust Company, as Trustee (“Trustee”), and the First Supplemental Indenture dated as of November 28, 2001, as supplemented by the Second Supplemental Indenture dated May 31, 2002, between TDS and Trustee (collectively, the “Supplemental Indenture”).   The terms of the 7.6% Notes, Indenture and the Supplemental Indenture are set forth in TDS’s Prospectus Supplement dated November 28, 2001 that was filed with the Securities and Exchange Commission (“SEC”) under SEC Rule 424(b)(5) on November 29, 2001 and are incorporated by reference herein.  After the redemption of such $217,500,000 in aggregate principal amount, $282,500,000 in aggregate principal amount of the 7.6% Notes will remain outstanding and will continue to be traded on the NYSE under the symbol “TDA.”  TDS did not and will not incur any early termination penalties or incur any other material obligations in connection with the redemption of the 7.6% Notes. 

The redemption will be financed with the net proceeds from the issuance of $225,000,000 in aggregate principal amount of TDS’ 6.875% Senior Notes due 2059 that were issued as of November 23, 2010.  TDS anticipates that the aggregate redemption cash payment, including accrued interest, will be approximately $222 million.

A copy of the Notice of Partial Redemption dated November 26, 2010 relating to redemption of 7.6% Notes is incorporated by reference herein as Exhibit 99.1.

On November 26, 2010, TDS issued a press release discussing the foregoing, which is incorporated by reference herein as Exhibit 99.2.

Item 9.01.               Financial Statements and Exhibits

(d)           Exhibits:

In accordance with the provisions of Item 601 of Regulation S-K, any Exhibits filed or furnished herewith are set forth on the Exhibit Index attached hereto.

SIGNATURES

                Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on their behalf by the undersigned, thereto duly authorized.

Telephone and Data Systems, Inc. (Registrant)
Date:	November 30, 2010
By:	/s/ Douglas D. Shuma
	Douglas D. Shuma Senior Vice President and Corporate Controller

EXHIBIT INDEX

Exhibit No.	Description
99.1	Notice of Partial Redemption dated November 26, 2010 relating to redemption of 7.6% Notes
99.2	Press Release dated November 26, 2010 relating to redemption of 7.6% Notes
99.3	Private Securities Litigation Reform Act of 1995 Safe Harbor Cautionary Statement

EX-99.1

Exhibit 99.1

NOTICE OF PARTIAL REDEMPTION

TO THE HOLDERS OF
7.60% SERIES A NOTES DUE 2041
OF
TELEPHONE AND DATA SYSTEMS, INC.

CUSIP NUMBER 879433 878

NOTICE IS HEREBY GIVEN, pursuant to the Indenture dated as of November 1, 2001 between Telephone and Data Systems, Inc., a Delaware corporation (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 in interest to BNY Midwest Trust Company (the “Trustee”), and the First Supplemental Indenture thereto dated as of November 28, 2001, as amended by the Second Supplemental Indenture dated as of May 31, 2002 (collectively the “Indenture”), as follows:

(1)        The Company’s 7.60% Series A Notes due 2041 (the “Notes”) are hereby called for redemption in part.  The CUSIP number of the Notes is 879433 878. 

(2)        The date fixed for redemption is December 27, 2010 (the “Redemption Date”).  Pursuant to the terms of the Indenture and the Notes, the Notes are redeemable at the option of the Company at any time on and after December 5, 2006.

(3)        Pursuant to the terms of the Indenture and the Notes, the Notes will be redeemed at a redemption price equal to 100% of the principal amount redeemed plus accrued and unpaid interest to the Redemption Date (the “Redemption Price”).

(4)        Payment of the Redemption Price will be made, upon presentation and surrender of the Notes, at the office of the following Paying Agent of the Company:

The Bank of New York Mellon
111 Sanders Creek Parkway
East Syracuse, New York 13057
Attn:  Corporate Trust Operations

(5)        Interest accrued to the Redemption Date will be paid as specified in this notice, and from and after said date interest will cease to accrue.

(6)        The Notes will be redeemed in part as follows:  $217,500,000 aggregate principal amount of the $500,000,000 outstanding Notes are to be redeemed.  Pursuant to the terms of the Notes, selection of the Notes for redemption will be made by the Trustee on a pro rata basis, by lot or by such other method as the Trustee in its sole discretion shall deem to be fair and appropriate, although no Note of $25 in principal amount at maturity or less

shall be redeemed in part.  If any Note is to be redeemed in part only, the notice of redemption relating to such Note shall state the portion of the principal amount thereof to be redeemed.  A new Note in principal amount at maturity equal to the unredeemed portion thereof will be issued in the name of the holder thereof upon cancellation of the original Note.

(7)        Neither the Company nor the Trustee shall be responsible for the accuracy of the CUSIP number either as printed on the Notes or as set forth in this Notice of Redemption.  The CUSIP number set forth above is included solely for the convenience of the holders of the Notes.

(8)        Prior to or on the Redemption Date, the Company shall deposit with the Paying Agent money sufficient to pay the Redemption Price of all Notes to be redeemed.  The redemption of the Notes is subject to the receipt of the aggregate Redemption Price by the Paying Agent on or before the Redemption Date and this notice shall be of no effect unless such moneys are so received on or before such date

(9)        Withholding of 28% of gross redemption proceeds of any payment made within the United States may be required unless the Paying Agent has the correct taxpayer identification number (social security or employer identification number) or certificate of exemption from back-up withholding from the payee.  If necessary, please furnish a properly completed Form W-9 or exemption certificate or equivalent when presenting your Notes.

(10)      Capitalized terms used but not otherwise defined herein are used as defined in the Indenture.

TELEPHONE AND DATA SYSTEMS, INC.

Dated:  November 26, 2010

EX-99.2

Exhibit 99.2

 

Contact:	Jane W. McCahon, Vice President, Corporate Relations (312) 592-5379 jane.mccahon@teldta.com
	Julie D. Mathews, Manager, Investor Relations (312) 592-5341 julie.mathews@teldta.com

FOR RELEASE:  IMMEDIATE

TDS ANNOUNCES PARTIAL REDEMPTION OF 7.6 PERCENT SERIES A NOTES

CHICAGO – Nov. 26, 2010 – Telephone and Data Systems, Inc. (NYSE: TDS, TDS.S) today announced that it will redeem some of its outstanding 7.6 percent Series A Notes due 2041 (NYSE: TDA).   TDS will redeem $217.5 million aggregate principal amount of the $500 million outstanding notes on Dec. 27, 2010, at a redemption price of 100 percent of the principal amount, together with accrued and unpaid interest to the redemption date.  The Depository Trust Company (DTC), the securities’ holder of record, will determine by random lottery how a partial series redemption will be allocated.  

As previously announced, TDS sold $200 million of 6.875 percent Senior notes (NYSE: TDE) on Nov. 16, 2010.  Additionally, as part of the Underwriting Agreement, the underwriters exercised their over-allotment option and purchased an additional $25 million of the 6.875 Senior notes on Nov. 24, 2010.  In aggregate, the net proceeds were approximately $217.5 million.

Additional information will be included in a Form 8-K to be filed with the Securities and

Exchange Commission. A notice of partial redemption with instructions is being distributed to registered holders of the notes. Beneficial holders with any questions about the redemption should contact their respective brokerage firm or financial institution.

About TDS

Telephone and Data Systems, Inc. (TDS), a Fortune 500® company, provides wireless, local and long-distance telephone and broadband services to approximately 7.2 million customers in 36 states through its business units, U.S. Cellular and TDS Telecom. Founded in 1969 and headquartered in Chicago, TDS employed 12,300 people as of September 30, 2010.

Visit www.teldta.com for comprehensive financial information, including earnings releases, quarterly and annual filings, shareholder information and more.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: All information set forth in this news release, except historical and factual information, represents forward-looking statements. This includes all statements about the company’s plans, beliefs, estimates and expectations. These statements are based on current estimates, projections and assumptions, which involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Important factors that may affect these forward-looking statements include, but are not limited to: The ability of the company to successfully grow its markets; the overall economy; competition; the access to and pricing of unbundled network elements; the ability to obtain or maintain roaming arrangements with other carriers; the state and federal telecommunications regulatory environment; the value of assets and investments; adverse changes in the ratings afforded TDS and U.S. Cellular debt securities by accredited ratings organizations; industry consolidation; advances in telecommunications technology; uncertainty of access to the capital markets; pending and future litigation; changes in income tax rates, laws, regulations or rulings; acquisitions/divestitures of properties and/or licenses; and changes in customer growth rates, average monthly revenue per unit, churn rates, roaming revenue and terms, the availability of handset devices, or the mix of products and services offered by U.S. Cellular and TDS Telecom. Investors are encouraged to consider these and other risks and uncertainties that are discussed in the Form 8-K used by TDS to furnish this press release to the SEC, which are incorporated by reference herein.

For more information about TDS and its subsidiaries, visit the web sites at:

TDS:  www.teldta.com                                                                         TDS Telecom: www.tdstelecom.com

USM: www.uscellular.com                                                                

###

EX-99.3

Exhibit 99.3

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 TDS 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 actu al 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 TDS’ Form 10-K, as updated by any TDS 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.  TDS 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 TDS’ Form 10-K, as updated by any TDS 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 TDS’ business.

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

·A failure by TDS to successfully execute its business strategy or allocate resources or capital could have an adverse effect on TDS’ business, financial condition or results of operations.

·A failure by TDS’ service offerings to meet customer expectations could limit TDS’ ability to attract and retain customers and could have an adverse effect on TDS’ operations.

·TDS’ systems infrastructure may not be capable of supporting changes in technologies and services expected by customers, which could result in lost customers and revenues.

·An inability to obtain or maintain roaming arrangements with other carriers on terms that are acceptable to TDS could have an adverse effect on TDS’ business, financial condition or results of operations.

·TDS currently receives a significant amount of roaming revenues from its wireless business.  As a result of consolidation of companies in the wireless industry, TDS roaming revenues have declined significantly from amounts earned in certain prior years. Further industry consolidation and continued build outs by existing and new wireless carriers could cause roaming revenues to decline even more, which would have an adverse effect on TDS’ business, financial condition and results of operations.

·A failure by TDS 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 TDS’ business and operations.

·In the event that the FCC conducts auctions of additional spectrum in the future, TDS is likely to participate in such auctions as an applicant or as a non-controlling 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 TDS.

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

·Changes in USF funding and/or intercarrier compensation could have a material adverse impact on TDS’ financial position or results of operations.

·An inability to attract and/or retain management, technical, sales and other personnel could have an adverse effect on TDS’ business, financial condition or results of operations.

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

·The completion of acquisitions by other companies has led to increased consolidation in the wireless telecommunications industry.  TDS’ lower scale relative to larger wireless carriers has in the past and could in the future prevent or delay its access to new products including handsets, new technology and/or new content and applications which could adversely affect TDS’ ability to attract and retain customers and, as a result, could adversely affect its business, financial condition or results of operations.    

·Inability to manage its supply chain or inventory successfully could have an adverse effect on TDS’ business, financial condition or results of operations.

·Changes in general economic and business conditions, both nationally and in the markets in which TDS operates, could have an adverse effect on TDS’ business, financial condition or results of operations.

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

·Advances or changes in telecommunications technology, such as Voice over Internet Protocol (“VoIP”), High-Speed Packet Access, WiMAX or Long-Term Evolution (“LTE”), could render certain technologies used by TDS obsolete, could reduce TDS’ revenues or could increase its costs of doing business.

·TDS could incur higher than anticipated intercarrier compensation costs.

·TDS 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.

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

·Costs, integration problems or other factors associated with developing and enhancing business support systems, acquisitions/divestitures of properties or licenses and/or expansion of TDS’ business could have an adverse effect on TDS’ business, financial condition or results of operations.

·A significant portion of TDS’ wireless revenues is derived from customers who buy services through independent agents who market TDS’ services on a commission basis. If TDS’ relationships with these agents are seriously harmed, its wireless revenues could be adversely affected.

·TDS’ investments in technologies which are unproven may not produce the benefits that TDS expects.

·A failure by TDS 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 and support systems could have an adverse effect on its operations.

·Financial difficulties (including bankruptcy proceedings) of any of TDS’ key suppliers or vendors, termination or impairment of TDS’ relationships with such suppliers or vendors, or a failure by TDS to manage its supply chain effectively could result in delays or termination of TDS’ receipt of required equipment or services, or could result in excess quantities of required equipment or services, any of which could adversely affect TDS’ business, financial condition or results of operations.

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

·A failure by TDS to maintain flexible and capable telecommunication networks or information technology, or a material disruption thereof, including breaches of network or information technology security, could have an adverse effect on TDS’ business, financial condition or results of operations.

·Wars, conflicts, hostilities and/or terrorist attacks or equipment failures, power outages, natural disasters or other events could have an adverse effect on TDS’ business, financial condition or results of operations.

·The market prices of TDS’ Common Shares and Special Common Shares are subject to fluctuations due to a variety of factors.

·Identification of errors in financial information or disclosures could require amendments to or restatements of financial information or disclosures included in this or prior filings with the SEC.

·Restatements of financial statements by TDS and related matters, including resulting delays in filing periodic reports with the SEC, could have an adverse effect on TDS’ business, financial condition or results of operations.

·The existence of material weaknesses in the effectiveness of internal control over financial reporting could result in inaccurate financial statements or other disclosures or failure to prevent fraud, which could have an adverse effect on TDS’ business, financial condition or results of operations.

·Changes in facts or circumstances, including new or additional information that affects the calculation of potential liabilities for contingent obligations under guarantees, indemnities, claims, litigation or otherwise, could require TDS to record charges in excess of amounts accrued in the financial statements, if any, which could have an adverse effect on TDS’ financial condition or results of operations.

·Early redemptions or repurchases of debt, issuances of debt, changes in operating leases, changes in purchase obligations or other factors or developments could cause the amounts reported under Contractual Obligations in Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in TDS’ most recent Annual Report on Form 10-K, as updated by the Quarterly Reports on Form 10-Q, to be different from the amounts actually incurred.

·An increase in the amount of TDS’ debt could subject TDS to higher interest costs and restrictions on its financing, investing and operating activities and could decrease its net income and cash flows.

·Disruption in credit or other financial markets, a deterioration of U.S. or global economic conditions or other events, could, among other things, impede TDS’ 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 TDS’ financial condition or results of operations.

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

·TDS’ and U.S. Cellular’s credit facilities and the indentures governing their senior notes include restrictive covenants that limit their operating flexibility and TDS and U.S. Cellular may be unable to service their debt or to refinance their indebtedness before maturity.

·Changes in income tax rates, laws, regulations or rulings, or federal or state tax assessments, could have an adverse effect on TDS’ financial condition or results of operations.

·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 TDS’ financial condition, results of operations or ability to do business.

·The possible development of adverse precedent in litigation or conclusions in professional studies to the effect that radio frequency emissions from handsets, wireless data 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 TDS’ wireless 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 TDS from using necessary technology to provide services or subject TDS to expensive intellectual property litigation or monetary penalties, which could have an adverse effect on TDS’ business, financial condition or results of operations.

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

·Any of the foregoing events or other events could cause customer net additions, revenues, operating income, capital expenditures and/or any other financial or statistical information to vary from TDS’ forward-looking estimates by a material amount.