Form 4: TDS Executive Anita J. Kroll Reports Acquisition of Restricted Stock Units and Performance Share Units

Anita J. Kroll, VP, Controller & CAO of Telephone & Data Systems Inc, reports the acquisition of restricted stock units and performance share units on May 21, 2025.

Summary

• On May 21, 2025, Anita J. Kroll, VP, Controller & CAO of Telephone & Data Systems Inc, reported the acquisition of 4,389 restricted stock units and 696 performance share units.
• The restricted stock units were awarded pursuant to the 2022 Long Term Incentive Plan and will vest in three equal installments on the annual anniversaries of the grant date.
• The performance share units are based on the performance of three key metrics, with 32% of the award tied to UScellular performance and having a 75% floor that can increase to 100% if the UScellular transaction with T-Mobile closes in 2025.
• The reported 696 performance share units reflect the 75% floor, representing 24% of the target award.
• Additional performance share units accumulate dividend equivalents, which are forfeitable if the performance metrics are not achieved.

Sentiment

Score: 7

Explanation: The document reflects a standard executive compensation practice, indicating a stable and ongoing business operation. The potential upside related to the UScellular transaction with T-Mobile adds a slightly positive outlook.

Positives

• The acquisition of restricted stock units and performance share units aligns the executive's interests with the company's long-term performance.
• The vesting schedule of the restricted stock units encourages continued service and commitment from the executive.
• The performance-based nature of the share units incentivizes the achievement of key performance metrics.

Risks

• The value of the restricted stock units and performance share units is subject to the company's stock price performance.
• The performance share units are contingent on achieving specific performance metrics, which may not be met.
• The UScellular transaction with T-Mobile is subject to regulatory approval and other conditions, and may not close as anticipated.

Future Outlook

The document indicates that another Form 4 may be filed to reflect an increase in the floor of the performance share units if the UScellular transaction with T-Mobile closes in 2025.

Industry Context

This filing is a routine disclosure of equity compensation to a company executive, which is a common practice in publicly traded companies to align management's interests with those of shareholders. The reference to the UScellular transaction with T-Mobile highlights a significant strategic event for Telephone & Data Systems Inc.

Comparison to Industry Standards

• Equity compensation is a standard practice across the telecommunications industry.
• Companies like Verizon and AT&T also use restricted stock units and performance share units to incentivize their executives.
• The vesting schedules and performance metrics used by TDS are likely comparable to those used by its peers.

Stakeholder Impact

• Shareholders: The equity compensation aligns management's interests with shareholder value.
• Employees: The compensation structure may influence employee morale and motivation.
• Customers: The UScellular transaction with T-Mobile could impact service offerings and customer experience.

Next Steps

• One-third of the restricted stock units will vest on the first, second and third annual anniversaries of the Grant Date.
• Another Form 4 would be filed to reflect an increase in the floor to the extent the UScellular transaction with T-Mobile closes in 2025.

Key Dates

Keywords

restricted stock units, performance share units, TDS, Anita J. Kroll, insider trading, Form 4, UScellular, T-Mobile, equity compensation