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 5, 2009

UNITED STATES CELLULAR CORPORATION
 (Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization)	1-9712 (Commission File Number)	62-1147325 (I.R.S. Employer Identification No.)
8410 West Bryn Mawr, Suite 700, Chicago, Illinois (Address of principal executive offices)		60631 (Zip Code)

Registrant’s telephone number, including area code:  (773) 399-8900

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 2.02.  Results of Operations and Financial Condition

On November 5, 2009, United States Cellular Corporation (“U.S. Cellular”) issued a news release announcing its results of operations for the period ended September 30, 2009.  A copy of the news release is attached hereto as Exhibit 99.1 and incorporated by reference herein.

The information in this Item 2.02 of Form 8-K is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section.

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.

Attached as Exhibit 99.2 is a safe harbor cautionary statement under the Private Securities Litigation Reform Act of 1995.

SIGNATURES

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

United States Cellular Corporation

(Registrant)          

Date:  November 5, 2009

By:	/s/ Steven T. Campbell
	Steven T. Campbell Executive Vice President – Finance, Chief Financial Officer and Treasurer

EXHIBIT INDEX

The following exhibits are filed or furnished herewith as noted below.

Exhibit No.	Description
99.1	Earnings Press Release dated November 5, 2009
99.2	Private Securities Litigation Reform Act of 1995 Safe Harbor Cautionary Statement

EX-99.1

Exhibit 99.1

As previously announced, U.S. Cellular® will hold a teleconference on Nov. 5, 2009, at 10:00 a.m. Chicago time. Interested parties may listen to the call live by accessing the Conference Calls page of www.teldta.com or uscellular.com.

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

U.S. cellular Reports THIRD QUARTER RESULTS

Data revenues increase 34 percent

Note: Comparisons are year over year unless otherwise noted.

3Q 2009 Highlights

§Postpay net additions were 8,000; prepaid net losses were 14,000.

§Service revenues of $984.9 million, down 3 percent due primarily to a $24.7 million decrease in inbound roaming revenues.

§Retail service ARPU (average revenue per unit) increased from $46.97 to $47.02.

§34 percent increase in data revenues, to $174.3 million, representing 18 percent of service revenues.  Data revenue per customer increased from $7.01 to $9.46.

§Postpay churn was 1.7 percent; postpay customers comprised 96 percent of retail customers.

§7 percent increase in cell sites in service, to 7,161.

CHICAGO – Nov. 5, 2009 – United States Cellular Corporation [NYSE:USM] reported service revenues of $984.9 million for the third quarter of 2009, a 3 percent decrease from $1,013.9 million in the comparable period one year ago, due primarily to a $24.7 million reduction in inbound roaming revenues related to the acquisition of Alltel Corporation by Verizon Wireless. Net income attributable to U.S. Cellular and related diluted earnings per share were $35.6 million and $0.41, respectively, for the third quarter of 2009, compared to $89.9 million and $1.02, respectively, in the comparable period one year ago.  In the third quarter of 2008, U.S. Cellular recorded a $16.4 million pre-tax gain on disposition of investments related to Rural Cellular Corporation.

“During the third quarter, both gross and net retail additions improved significantly over the second quarter,” said John E. Rooney, U.S. Cellular president and CEO. “We reached out with targeted postpay promotions and more value-driven prepaid plans and customers responded well, particularly in our larger markets. In fact, retail net additions improved sequentially each month in the quarter.

 

“Data revenues grew 34 percent, helping to offset the expected decline in inbound roaming revenue,” continued Rooney. “To promote continued growth in data revenues, we have accelerated the expansion of our 3G network, reaching approximately 75 percent of our customers at the end of the third quarter. This will help us further drive the already strong sales of smartphones, messaging products and data applications. We’re also seeing excellent demand for our premium phones, like the recently launched LG Bliss™ and LG Tritan™.  And, we’re optimizing our handset mix, including the recent launch of the Blackberry Tour™ to promote sales in all of our customer segments during the holiday season.

“As expected, operating income declined this quarter, reflecting lower revenues, as well as increased spending in support of multi-year initiatives,” added Rooney. “These initiatives will be a strong focus for U.S. Cellular in 2010 and beyond, enabling us to increase efficiency, while strengthening our relationships with customers and developing targeted marketing and sales programs for all channels.”

Guidance

Guidance for the year ending Dec. 31, 2009 is as follows. Guidance is unchanged from Aug. 6, 2009.  There can be no assurance that final results will not differ materially from this guidance.

U.S. Cellular 2009 guidance as of Nov. 5, 2009 is as follows:
	Service revenues	$3,900-$3,950 million
	Operating income (1)	$300-$375 million
	Depreciation, amortization and accretion (1)	Approx. $600 million
	Capital expenditures	Approx. $575 million

(1)Includes losses on disposals of assets.

The foregoing guidance represents the views of management as of Nov. 5, 2009 and should not be assumed to be accurate as of any other date. U.S. Cellular undertakes no legal duty to update such information, whether as a result of new information, future events or otherwise.

Conference call information

U.S. Cellular will hold a conference call on Nov. 5, 2009 at 10:00 a.m. Chicago time.

·Access the live call on the Conference Calls page of uscellular.com at http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=67422&eventID=2517092

·Access the call by phone at 800/706-9695 (US/Canada) and use conference ID #38289990.

Before the call, certain financial and statistical information to be discussed during the call will be posted to the Conference Calls page of uscellular.com, together with reconciliations to generally accepted accounting principles (GAAP) of any non-GAAP information to be disclosed. The call will be archived on the Conference Calls page of uscellular.com.

About U.S. Cellular®

United States Cellular Corporation, the nation's fifth-largest, full-service wireless carrier, provides a comprehensive range of wireless products and services, excellent customer support, and a high-quality network to approximately 6.1 million customers in 26 states. The Chicago-based company employed approximately 8,700 full-time equivalent associates as of Sept. 30, 2009. At the end of the quarter, Telephone and Data Systems, Inc. owned 82 percent of U.S. Cellular.

Visit uscellular.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

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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 manage and grow its markets; the current credit crisis affecting financial markets, and its effects on the overall economy; competition; the state and federal telecommunications regulatory environment; the value of assets and investments; adverse changes in the ratings afforded our 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; 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 the company; and the ability to obtain or maintain roaming arrangements with other carriers. Investors are encouraged to consider these and other risks and uncertainties that are discussed in the Form 8-K used by U.S. Cellular to furnish this press release to the SEC, which are incorporated by reference herein.

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UNITED STATES CELLULAR CORPORATION SUMMARY OPERATING DATA
Quarter Ended		9/30/2009			6/30/2009			3/31/2009			12/31/2008			9/30/2008
Total population
	Consolidated markets (1)		85,118,000			83,726,000			83,726,000			83,014,000			82,875,000
	Consolidated operating markets (1)		46,306,000			46,306,000			46,306,000			46,009,000			45,493,000
All customers
	Total at end of period		6,131,000			6,155,000			6,243,000			6,196,000			6,176,000
	Gross additions		386,000			317,000			404,000			395,000			367,000
	Net additions (losses)		(24,000	)		(88,000	)		47,000			20,000			(18,000	)
Market penetration at end of period
	Consolidated markets (2)		7.2	%		7.4	%		7.5	%		7.5	%		7.5	%
	Consolidated operating markets (2)		13.2	%		13.3	%		13.5	%		13.5	%		13.6	%
Retail customers
	Total at end of period		5,705,000			5,711,000			5,770,000			5,707,000			5,674,000
	Gross additions		351,000			286,000			366,000			352,000			325,000
	Net postpay additions (losses)		8,000			(32,000	)		60,000			41,000			12,000
	Net prepay additions (losses)		(14,000	)		(27,000	)		3,000			(8,000)			(15,000	)
Cell sites in service			7,161			7,043			6,942			6,877			6,716
Average monthly revenue per unit (3)		$	53.49		$	52.41		$	52.54		$	52.71		$	54.59
	Retail service revenue per unit (3) (5)	$	47.02		$	46.85		$	46.78		$	46.43		$	46.97
	Inbound roaming revenue per unit (3) (5)	$	3.73		$	3.35		$	3.21		$	4.25		$	5.03
	Other revenue per unit (3) (5)	$	2.74		$	2.21		$	2.55		$	2.03		$	2.59
Postpay churn rate (4)			1.7	%		1.7	%		1.5	%		1.6	%		1.6	%
Construction expenditures (000s)		$	128,900		$	91,200		$	137,700		$	190,000		$	146,100

(1)Used only to calculate market penetration of consolidated markets and consolidated operating markets, respectively, which is calculated by dividing customers by the total market population (without duplication of population in overlapping markets).

(2)Calculated by dividing the number of wireless customers at the end of the period by the total population of consolidated markets and consolidated operating markets, respectively, as estimated by Claritas.

(3)Derived from Service revenues as reported in Financial Highlights for each respective quarter as follows:

Service revenue (000s)		$	984,923	$	974,755	$	981,874	$	976,952	$	1,013,928
Components
	Retail service revenue (000s)		865,867		871,209		874,098		860,503		872,397
	Inbound roaming revenue (000s)		68,767		62,223		60,057		78,768		93,472
	Other revenue (000s)		50,289		41,323		47,719		37,681		48,059
Divided by average customers (000s)			6,138		6,199		6,229		6,178		6,191
Divided by three months in each quarter			3		3		3		3		3
Average monthly revenue per unit		$	53.49	$	52.41	$	52.54	$	52.71	$	54.59
Retail service revenue per unit		$	47.02	$	46.85	$	46.78	$	46.43	$	46.97
Inbound roaming revenue per unit		$	3.73	$	3.35	$	3.21	$	4.25	$	5.03
Other revenue per unit		$	2.74	$	2.21	$	2.55	$	2.03	$	2.59

(4)Calculated by dividing the total postpay customer disconnects during the quarter by the average postpay customer base for the quarter.

(5)Long-distance revenue was reclassified in the fourth quarter of 2008 from Other revenue to Retail service revenue and Inbound roaming revenue.  Previous quarters have been adjusted to reflect this change.

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United States Cellular Corporation Consolidated Statement of Operations Highlights Three Months Ended September 30, (Unaudited, dollars and shares in thousands, except per share amounts)
									Increase (Decrease)
			2009			2008			Amount			Percent
Operating revenues
	Service		$	984,923		$	1,013,928		$	(29,005	)	(3	)%
	Equipment sales			73,377			77,947			(4,570	)	(6	)%
		Total operating revenues		1,058,300			1,091,875			(33,575	)	(3	)%
Operating expenses
	System operations (excluding Depreciation, amortization and accretion reported below)			205,458			197,473			7,985		4	%
	Cost of equipment sold			189,354			185,992			3,362		2	%
	Selling, general and administrative			454,839			436,135			18,704		4	%
	Depreciation, amortization and accretion			147,586			145,434			2,152		1	%
	Loss on asset disposals, net			3,371			6,884			(3,513	)	(51	)%
		Total operating expenses		1,000,608			971,918			28,690		3	%
Operating income				57,692			119,957			(62,265	)	(52	)%
Investment and other income (expense)
	Equity in earnings of unconsolidated entities			23,126			22,319			807		4	%
	Interest and dividend income			1,420			1,137			283		25	%
	Gain on disposition of investments			—			16,628			(16,628	)	N/M
	Interest expense			(19,358	)		(19,722	)		364		2	%
	Other, net			905			391			514		N/M
		Total investment and other income (expense)		6,093			20,753			(14,660	)	(71	)%
Income before income taxes				63,785			140,710			(76,925	)	(55	)%
	Income tax expense			22,541			45,506			(22,965	)	(50	)%
Net income				41,244			95,204			(53,960	)	(57	)%
	Less: Net income attributable to noncontrolling interests, net of tax			(5,606	)		(5,255	)		(351	)	(7	)%
Net income attributable to U.S. Cellular			$	35,638		$	89,949		$	(54,311	)	(60	)%
Basic weighted average shares outstanding				86,848			87,460			(612	)	(1	)%
Basic earnings per share attributable to U.S. Cellular shareholders			$	0.41		$	1.03		$	(0.62	)	(60	)%
Diluted weighted average shares outstanding				87,128			87,833			(705	)	(1	)%
Diluted earnings per share attributable to U.S. Cellular shareholders			$	0.41		$	1.02		$	(0.61	)	(60	)%
N/M - Percentage change not meaningful

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United States Cellular Corporation Consolidated Statement of Operations Highlights Nine Months Ended September 30, (Unaudited, dollars and shares in thousands, except per share amounts)
									Increase (Decrease)
			2009			2008			Amount			Percent
Operating revenues
	Service		$	2,941,552		$	2,963,374		$	(21,822	)	(1	)%
	Equipment sales			212,062			226,949			(14,887	)	(7	)%
		Total operating revenues		3,153,614			3,190,323			(36,709	)	(1	)%
Operating expenses
	System operations (excluding Depreciation, amortization and accretion reported below)			600,267			585,141			15,126		3	%
	Cost of equipment sold			531,110			540,182			(9,072	)	(2	)%
	Selling, general and administrative			1,277,357			1,258,177			19,180		2	%
	Depreciation, amortization and accretion			423,851			433,222			(9,371	)	(2	)%
	Loss on asset disposals, net			7,648			16,776			(9,128	)	(54	)%
		Total operating expenses		2,840,233			2,833,498			6,735		—
Operating income				313,381			356,825			(43,444	)	(12	)%
Investment and other income (expense)
	Equity in earnings of unconsolidated entities			73,247			66,361			6,886		10	%
	Interest and dividend income			2,648			4,471			(1,823	)	(41	)%
	Gain on disposition of investments			—			16,628			(16,628	)	N/M
	Interest expense			(57,767	)		(60,611	)		2,844		5	%
	Other, net			1,183			1,109			74		7	%
		Total investment and other income (expense)		19,311			27,958			(8,647	)	(31	)%
Income before income taxes				332,692			384,783			(52,091	)	(14	)%
	Income tax expense			111,521			137,062			(25,541	)	(19	)%
Net income				221,171			247,721			(26,550	)	(11	)%
	Less: Net income attributable to noncontrolling interests, net of tax			(17,583	)		(14,613	)		(2,970	)	(20	)%
Net income attributable to U.S. Cellular			$	203,588		$	233,108		$	(29,520	)	(13	)%
Basic weighted average shares outstanding				87,011			87,534			(523	)	(1	)%
Basic earnings per share attributable to U.S. Cellular shareholders			$	2.34		$	2.66		$	(0.32	)	(12	)%
Diluted weighted average shares outstanding				87,216			87,908			(692	)	(1	)%
Diluted earnings per share attributable to U.S. Cellular shareholders			$	2.33		$	2.65		$	(0.32	)	(12	)%
N/M - Percentage change not meaningful

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United States Cellular Corporation Consolidated Balance Sheet Highlights (Unaudited, dollars in thousands)
ASSETS
		September 30, 2009		December 31, 2008
Current assets
	Cash and cash equivalents	$	404,894	$	170,996
	Accounts receivable from customers and other		447,958		419,619
	Inventory		121,073		116,564
	Prepaid income taxes		4,793		22,515
	Prepaid expenses		63,020		51,645
	Net deferred income tax asset		19,481		19,481
	Other current assets		53,101		14,227
			1,114,320		815,047
Investments
	Licenses		1,445,501		1,433,415
	Goodwill		494,737		494,279
	Customer lists		5,273		8,936
	Investments in unconsolidated entities		177,497		156,637
	Notes and interest receivable – long-term		4,247		4,297
			2,127,255		2,097,564
Property, plant and equipment
	In service and under construction		5,718,767		5,884,383
	Less: accumulated depreciation		3,157,001		3,264,007
			2,561,766		2,620,376
Other assets and deferred charges			38,484		33,055
Total assets		$	5,841,825	$	5,566,042

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United States Cellular Corporation Consolidated Balance Sheet Highlights (Unaudited, dollars in thousands)
LIABILITIES AND SHAREHOLDERS’ EQUITY
			September 30, 2009			December 31, 2008
Current liabilities
	Current portion of long-term debt		$	10,088		$	10,258
	Accounts payable
		Affiliated		8,633			9,613
		Trade		235,353			248,785
	Customer deposits and deferred revenues			146,224			151,082
	Accrued taxes			56,500			17,643
	Accrued compensation			57,012			55,969
	Other current liabilities			102,157			108,533
				615,967			601,883
Deferred liabilities and credits
	Net deferred income tax liability			518,245			478,106
	Other deferred liabilities and credits			250,762			233,619
				769,007			711,725
Long-term debt				997,552			996,636
Commitments and contingencies
Noncontrolling interests with mandatory redemption features				708			589
Equity
U.S. Cellular shareholders’ equity
	Common Shares, par value $1 per share			55,068			55,068
	Series A Common Shares, par value $1 per share			33,006			33,006
	Additional paid-in capital			1,353,544			1,340,146
	Treasury shares			(63,912	)		(50,258	)
	Retained earnings			2,020,710			1,828,680
		Total U.S. Cellular shareholders’ equity		3,398,416			3,206,642
Noncontrolling interests				60,175			48,567
	Total equity			3,458,591			3,255,209
Total liabilities and equity			$	5,841,825		$	5,566,042

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United States Cellular Corporation Consolidated Statement of Cash Flows Nine Months Ended September 30, (Unaudited, dollars in thousands)
			2009			2008
Cash flows from operating activities
	Net income		$	221,171		$	247,721
	Add (deduct) adjustments to reconcile net income to net cash flows from operating activities
		Depreciation, amortization and accretion		423,851			433,222
		Bad debts expense		73,100			52,753
		Stock-based compensation expense		13,000			11,293
		Deferred income taxes, net		44,429			44,486
		Equity in earnings of unconsolidated entities		(73,247	)		(66,361	)
		Distributions from unconsolidated entities		51,306			50,859
		Gain on disposition of investments		—			(16,628	)
		Loss on asset disposals, net		7,648			16,776
		Excess tax benefit from stock awards		(4	)		(1,018	)
		Other noncash expense		1,828			1,539
	Changes in assets and liabilities from operations
		Accounts receivable		(101,263	)		(71,551	)
		Inventory		(4,509	)		(11,552	)
		Accounts payable - trade		(13,432	)		11,383
		Accounts payable - affiliate		(980	)		134
		Customer deposits and deferred revenues		(4,858	)		9,534
		Accrued taxes		58,139			(1,724	)
		Accrued interest		9,787			9,787
		Other assets and liabilities		(68,272	)		(24,073	)
				637,694			696,580
Cash flows from investing activities
	Additions to property, plant and equipment			(357,770	)		(395,637	)
	Proceeds from disposition of investments			—			16,690
	Cash received from divestitures			50			6,838
	Cash paid for acquisitions and licenses			(12,527	)		(314,730	)
	Other investing activities			1,357			(1,255	)
				(368,890	)		(688,094	)
Cash flows from financing activities
	Issuance of notes payable			—			100,000
	Repayment of notes payable			—			(100,000	)
	Common shares reissued for benefit plans, net of tax payments			(119	)		(1,286	)
	Common shares repurchased			(24,283	)		(23,146	)
	Excess tax benefit from stock awards			4			1,018
	Payment of debt issuance costs			(4,416	)		—
	Distributions to noncontrolling interests			(5,856	)		(9,146	)
	Other financing activities			(236	)		(2,851	)
				(34,906	)		(35,411	)
Net increase (decrease) in cash and cash equivalents				233,898			(26,925	)
Cash and cash equivalents
	Beginning of period			170,996			204,533
	End of period		$	404,894		$	177,608

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EX-99.2

Exhibit 99.2

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 United States Cellular Corporation (“U.S. Cellular”) 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, un certainties and other factors that may cause actual 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 U.S. Cellular’s Form 10-K, as updated by any U.S. Cellular 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.  U.S. Cellular undertakes no obligation to update publicly any forward-looking statements whether as a result of new information, fu ture events or otherwise.   You should carefully consider the Risk Factors in the most recent filing of U.S. Cellular’s Form 10-K, as updated by any U.S. Cellular 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 U.S. Cellular’s business.

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

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

·U.S. Cellular’s system 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 U.S. Cellular could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

·U.S. Cellular currently receives a significant amount of roaming revenues.  As a result of recent acquisitions by other companies in the wireless industry, U.S. Cellular’s roaming revenues have declined.  U.S. Cellular anticipates that this trend will continue over the next few quarters.  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 U.S. Cellular’s business, financial condition and results of operations.

·A failure by U.S. Cellular to obtain access to adequate radio spectrum could have an adverse effect on U.S. Cellular’s business and operations.

·To the extent conducted by the FCC, U.S. Cellular is likely to participate in FCC auctions of additional spectrum in the future 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 U.S. Cellular.

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

·U.S. Cellular’s assets are concentrated in the U.S. wireless 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 has led to increased consolidation in the wireless telecommunications industry.  U.S. Cellular’s 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 U.S. Cellular’s 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 U.S. Cellular’s business, financial condition or results of operations.

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

·Changes in various business factors could have an adverse effect on U.S. Cellular’s 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 U.S. Cellular obsolete, could reduce U.S. Cellular’s revenues or could increase its costs of doing business.

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

·Costs, integration problems or other factors associated with acquisitions/divestitures of properties or licenses and/or expansion of U.S. Cellular’s business could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

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

·U.S. Cellular’s investments in technologies which are unproven or for which success has not yet been demonstrated may not produce the benefits that U.S. Cellular expects.

·A failure by U.S. Cellular 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 U.S. Cellular’s key suppliers or vendors, termination or impairment of U.S. Cellular’s relationships with such suppliers or vendors, or a failure by U.S. Cellular to manage its supply chain effectively could result in delays or termination of U.S. Cellular’s receipt of required equipment or services, or could result in excess quantities of required equipment or services, any of which could adversely affect U.S. Cellular’s business, financial condition or results of operations.

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

·A material disruption in U.S. Cellular’s telecommunication networks or information technology, including breaches of network or information technology security, could have an adverse effect on U.S. Cellular’s 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 U.S. Cellular’s business, financial condition or results of operations.

·The market price of U.S. Cellular’s Common Shares is subject to fluctuations due to a variety of factors.

·Changes in interpretations of accounting requirements, changes in industry practice, identification of errors or changes in management assumptions 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 U.S. Cellular and related matters, including resulting delays in filing periodic reports with the SEC, could have an adverse effect on U.S. Cellular’s 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 U.S. Cellular’s 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 or otherwise, could require U.S. Cellular to record charges in excess of amounts accrued in the financial statements, if any, which could have an adverse effect on U.S. Cellular’s 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 U.S. Cellular's 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 U.S. Cellular’s debt could subject U.S. Cellular 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 and other financial markets and the deterioration of U.S. and global economic conditions, could, among other things, impede U.S. Cellular’s 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 U.S. Cellular's 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 U.S. Cellular’s credit ratings or other factors could limit or restrict the availability of financing on terms and prices acceptable to U.S. Cellular, which could require U.S. Cellular to reduce its construction, development or acquisition programs.

·Changes in the regulatory environment or a failure by U.S. Cellular to timely or fully comply with any applicable regulatory requirements could adversely affect U.S. Cellular’s 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 U.S. Cellular’s financial position or results of operations.

·Changes in income tax rates, laws, regulations or rulings, or federal or state tax assessments, could have an adverse effect on U.S. Cellular’s 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 U.S. Cellular’s 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 U.S. Cellular’s 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 U.S. Cellular from using necessary technology to provide services or subject U.S. Cellular to expensive intellectual property litigation or monetary penalties, which could have an adverse effect on U.S. Cellular's business, financial condition or results of operations.

·There are potential conflicts of interests between Telephone and Data Systems, Inc. (“TDS”), the parent of U.S. Cellular, and U.S. Cellular.

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

·A failure by U.S. Cellular to successfully execute its business strategy could have an adverse effect on U.S. Cellular’s business, financial condition or results of operations.

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