Delaware
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001-09712
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62-1147325
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(State or other jurisdiction of incorporation)
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(Commission File Number)
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(I.R.S. Employer Identification No.)
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☐
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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☐
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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☐
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading Symbol
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Name of each exchange on which registered
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Common Shares, $1 par value
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USM
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New York Stock Exchange
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6.95% Senior Notes due 2060
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UZA
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New York Stock Exchange
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7.25% Senior Notes due 2063
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UZB
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New York Stock Exchange
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7.25% Senior Notes due 2064
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UZC
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New York Stock Exchange
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☐
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Emerging growth company
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☐
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
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Performance Measures
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Component Weighting
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Overall Plan Weighting
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Consolidated Total Service Revenues
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30%
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18%
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Consolidated Operating Cash Flow
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30%
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18%
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Consolidated Capital Expenditures
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15%
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9%
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Customer Engagement
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15%
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9%
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Consolidated Equivalent Handset Net Additions
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10%
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6%
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Company Performance
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60%
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Chairman Assessment on Strategic Initiatives
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10%
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Individual Performance
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30%
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Performance Measures
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Component Weighting
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Overall Plan Weighting
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Consolidated Total Service Revenues
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30%
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12%
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Consolidated Operating Cash Flow
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30%
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12%
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Consolidated Capital Expenditures
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15%
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6%
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Customer Engagement
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15%
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6%
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Consolidated Equivalent Handset Net Additions
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10%
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4%
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Company Performance
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40%
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Team Performance
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40%
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Individual Performance
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20%
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Exhibit Number
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Description of Exhibits
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10.1
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10.2
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104
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Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.
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SIGNATURES
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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 hereunto duly authorized.
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UNITED STATES CELLULAR CORPORATION
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(Registrant)
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Date:
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March 26, 2020
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By:
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/s/ Douglas W. Chambers
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Douglas W. Chambers
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Senior Vice President, Chief Financial Officer and Treasurer
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(principal financial officer)
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I.
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PURPOSE
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•
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To provide incentive for the executive officers of United States Cellular Corporation (“U.S. Cellular” or “Company”) to extend their best efforts towards achieving superior results in relation to key performance targets;
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•
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To reward U.S. Cellular executive officers in relation to their success in meeting and exceeding the performance targets; and
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•
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To attract and retain talented leaders in positions of critical importance to the success of the Company.
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II.
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ELIGIBLE PARTICIPANTS
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III.
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PERFORMANCE MEASURES & WEIGHTINGS
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Performance Measures
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Component Weighting
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Overall Plan Weighting
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Consolidated Total Service Revenues
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30%
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18%
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Consolidated Operating Cash Flow
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30%
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18%
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Consolidated Capital Expenditures
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15%
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9%
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Customer Engagement
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15%
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9%
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Consolidated Equivalent Handset Net Additions
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10%
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6%
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Company Performance
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60%
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Chairman Assessment on Strategic Initiatives
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10%
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Individual Performance
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30%
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IV.
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PERFORMANCE MEASURES DEFINITIONS
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▪
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Results associated with acquisitions and / or divestitures will be evaluated on a case-by-case basis to determine whether adjustments to target or actual results are warranted.
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▪
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The Chairman in his discretion may adjust targets to reflect unanticipated events.
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▪
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Achievement of key goals and objectives provided to the U.S. Cellular board of directors.
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▪
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Accomplishing / making commendable progress on major initiatives for the year to the extent not covered under the key goals and objectives provided to the board of directors.
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▪
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Developing and enhancing strategies and plans that strengthen the Company’s ability to successfully compete in the marketplace.
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▪
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Carrying out his/her ongoing responsibilities and key initiatives during the performance year.
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▪
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Executive level leadership and teamwork.
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Identification and development of key talent for succession planning purposes.
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▪
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Engagement as measured in large part by the Company’s culture survey.
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▪
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Performance feedback received on the officer.
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▪
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The officer’s report on his/her activities/accomplishments for the performance year.
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V.
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MISCELLANEOUS PROVISIONS
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VI.
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BONUS RANGES AS A PERCENT OF TARGET
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Performance Measure
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Minimum
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Maximum
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Consolidated Total Service Revenues
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90%
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110%
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Consolidated Operating Cash Flow
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80%
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120%
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Consolidated Capital Expenditures
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110%
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80%
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Customer Engagement
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95%
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110%
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Consolidated Equivalent Handset Net Additions
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See Note immediately below
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Performance Measure
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Minimum
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Target
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Maximum
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Consolidated Total Service Revenues
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50%
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100%
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225%
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Consolidated Operating Cash Flow
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50%
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100%
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225%
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Consolidated Capital Expenditures
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50%
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100%
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225%
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Customer Engagement
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50%
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100%
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225%
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Consolidated Equivalent Handset Net Additions
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50%
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100%
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225%
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Performance Criteria
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% Payout Range
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Far exceeds target performance: Performance greatly exceeded that which was planned and expected.
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150% - 200%
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Exceeds target performance: Performance exceeded that which was planned and expected.
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120% - 150%
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Meets target performance: Performance was essentially equivalent to that which was planned and expected.
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80% - 120%
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Partially meets target performance: Given the conditions that prevailed, performance was sufficient to merit a partial bonus.
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Up to 80%
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Fails to meet target performance: Given the conditions that prevailed, performance was not sufficient to merit any bonus.
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0%
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Performance Criteria
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% Payout Range
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Far Exceeds Expectations (FE)
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130% - 150%
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Exceeds Expectations (EE)
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110% - 130%
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Meets Expectations (ME)
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80% -110%
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Partially Meets Expectations (PM)
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0%
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Fails to Meet Expectations (FM)
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0%
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President and CEO
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Date
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Chairman
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Date
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PLAN YEAR EFFECTIVE DATES
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January 1, 2020 - December 31, 2020
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GENERAL ADMINISTRATION
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The target annual bonus payout for Plan participants will be based on the officer’s base earnings paid during the bonus period. Base earnings include base wages, paid time off, and any differential pay (excludes Short-term disability pay, Long-term disability pay, Paid Parental Leave, Military Service Leave of Absence, any Paid Personal Leave of Absence, bonuses, merit-related lump sum payments, equity, on call pay and any additional compensation not related to base earnings).
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VESTING
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The bonus does not vest and no bonus shall be paid unless the officer remains employed through the actual bonus payout date. In the event of retirement / death prior to the actual bonus payout date, see special rules below.
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NEW HIRE ELIGIBILITY
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Eligibility for participation in this Plan and any payout will be determined at the discretion of the President and CEO.
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SEPARATION PRIOR TO PAYOUT DATE
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Not eligible for a payout unless separation is due to retirement or death under the circumstances described (or unless approved by the President and CEO).
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RETIREMENT
Prior to Payout Vesting Date
DEATH
Prior to Payout Vesting Date
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Officer must be at least age 55 and have a minimum of 10 years of 401(k) vesting service at time of retirement to be eligible for a payout (unless otherwise approved by the President and CEO).
In the event of death or retirement during the plan year (1/1 - 12/31) a prorated bonus for time worked at target (100% Plan attainment) will be paid provided that.the officer has been employed through at least January 31st of the plan year. An officer who is not employed through at least January 31st of the plan year will not be eligible to receive a prorated bonus payout for the time worked during the year of the event. The payout will be made as soon as administratively possible following the date of the event (but no later than the Bonus Payout Date, as described below).
In the event of death or retirement after the plan year, but before the payout date for the plan year, a participant will be eligible to receive a bonus for time worked in the prior year based upon actual Plan attainment (company, chairman assessment and individual performance). The payout will be made as soon as administratively possible following the date of the event and after receiving actual Plan attainment (but no later than the Bonus Payout Date, as described below).
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TRANSFERS/PROMOTIONS WITHIN COMPANY DURING PLAN YEAR
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Within/ Between Annual Plans:
If an officer is promoted / transferred within or between annual incentive plan(s), no pro-rations will be made in determining the officer’s bonus. The officer’s bonus will be based on the officer’s plan as of 12/31/20.
Between an Annual Plan and a Quarterly or Monthly Plan:
Prorated payouts from both positions/plans will be determined following the end of the plan year. The following factors will be considered in the determination of the payout: both plans’ attainment percentages, individual performance in each job/plan, the eligible base earnings from each position occupied during the plan year (if applicable), target incentive assigned for each position’s pay grade, and percentage of time worked in each position/plan during the plan year.
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TRANSFERS TO/ FROM TDS DURING THE PLAN YEAR
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If an officer transfers to/from another TDS business unit, he/she will be eligible to receive a bonus deemed appropriate by the Chairman, considering all applicable factors.
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BONUS PAYOUT DATE
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The bonus will be paid no later than March 15th of the year following the end of the plan year (12/31) (historically, bonuses have been paid in March on or before March 15). Notwithstanding the foregoing, in the event that payment by March 15, 2021 is administratively impracticable and such impracticability was unforeseeable (in each case, such that the payment continues to qualify as a “short-term deferral” within the meaning of section 409A of the Internal Revenue Code), payment will be made as soon as administratively practicable after March 15, 2021, but in no event later than December 31, 2021. Payment will be in the form of a lump sum.
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I.
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PURPOSE
|
•
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To provide incentive for the officers of United States Cellular Corporation (“U.S. Cellular” or “Company”) to extend their best efforts towards achieving superior results in relation to key business performance targets;
|
•
|
To reward U.S. Cellular officers in relation to their success in meeting and exceeding the performance targets; and
|
•
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To attract and retain talented leaders in positions of critical importance to the success of the Company.
|
II.
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ELIGIBLE PARTICIPANTS
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III.
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PERFORMANCE MEASURES & WEIGHTINGS
|
Performance Measures
|
Component Weighting
|
Overall Plan Weighting
|
Consolidated Total Service Revenues
|
30%
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12%
|
Consolidated Operating Cash Flow
|
30%
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12%
|
Consolidated Capital Expenditures
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15%
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6%
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Customer Engagement
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15%
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6%
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Consolidated Equivalent Handset Net Additions
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10%
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4%
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Company Performance
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40%
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Team Performance
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40%
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Individual Performance
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20%
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IV.
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PERFORMANCE MEASURES DEFINITIONS
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▪
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Results associated with acquisitions and / or divestitures will be evaluated on a case-by-case basis to determine whether adjustments to target or actual results are warranted.
|
▪
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The Chairman in his discretion may adjust targets to reflect unanticipated events.
|
V.
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MISCELLANEOUS PROVISIONS
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VI.
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BONUS RANGES AS A PERCENT OF TARGET
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Performance Measure
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Minimum
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Maximum
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Consolidated Total Service Revenues
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90%
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110%
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Consolidated Operating Cash Flow
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80%
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120%
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Consolidated Capital Expenditures
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110%
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80%
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Customer Engagement
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95%
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110%
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Consolidated Equivalent Handset Net Additions
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See Note immediately below
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Performance Measure
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Minimum
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Target
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Maximum
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Consolidated Total Service Revenues
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50%
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100%
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225%
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Consolidated Operating Cash Flow
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50%
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100%
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225%
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Consolidated Capital Expenditures
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50%
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100%
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225%
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Customer Engagement
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50%
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100%
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225%
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Consolidated Equivalent Handset Net Additions
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50%
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100%
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225%
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Performance Criteria
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% Payout Range
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Far exceeds target performance: Performance greatly exceeded that which was planned and expected.
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150% - 200%
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Exceeds target performance: Performance exceeded that which was planned and expected.
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120% - 150%
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Meets target performance: Performance was essentially equivalent to that which was planned and expected.
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80% - 120%
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Partially meets target performance: Given the conditions that prevailed, performance was sufficient to merit a partial bonus.
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Up to 80%
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Fails to meet target performance: Given the conditions that prevailed, performance was not sufficient to merit any bonus.
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0%
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Performance Criteria
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% Payout Range
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Far Exceeds Expectations (FE)
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130% - 150%
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Exceeds Expectations (EE)
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110% - 130%
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Meets Expectations (ME)
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80% - 110%
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Partially Meets Expectations (PM)
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0%
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Fails to Meet Expectations (FM)
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0%
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President and CEO
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Date
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Chairman
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Date
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