Form 4: TDS Executive Vice President Vicki L. Villacrez Reports Changes in Beneficial Ownership

Vicki L. Villacrez, Executive Vice President & CFO of Telephone & Data Systems Inc, reports the vesting of performance share units based on achievement of key metrics.

Summary

• On March 12, 2025, Vicki L. Villacrez, Executive Vice President & CFO of Telephone & Data Systems Inc, reported changes in beneficial ownership.
• The changes involve performance share units granted on June 11, 2024, based on the performance of three key metrics.
• One of the three metrics was certified at 145.9% on March 12, 2025, by the Compensation Human Resources Committee based on company performance at December 31, 2024.
• The performance shares representing this metric were certified, adjusted for performance, and are now time-based, vesting on June 11, 2027.
• The reported transaction involved 13,945 performance share units.
• The performance share units have been accumulating quarterly dividend equivalents, and each unit represents the contingent right to receive one common share.

Sentiment

Score: 6

Explanation: The document indicates achievement of one performance metric, which is moderately positive. However, the ultimate value of the performance share units depends on future performance, creating some uncertainty.

Positives

• The achievement of one of the key metrics at 145.9% suggests positive company performance in that area.

Risks

• The ultimate value of the performance share units depends on the company's future performance and the achievement of the remaining two metrics.

Future Outlook

The ultimate payout of the performance share units could range from 0% to 192% of the target, depending on the achievement of the remaining two key metrics measured over two and three-year periods.

Industry Context

Executive compensation structures often include performance-based equity awards to align management's interests with those of shareholders. The vesting of these awards is contingent upon achieving specific financial or operational targets.

Stakeholder Impact

• The vesting of performance share units aligns management's interests with those of shareholders by incentivizing them to achieve key performance metrics.
• The performance share units have been accumulating quarterly dividend equivalents.

Next Steps

• The remaining two performance metrics will be measured on December 31, 2025, and December 31, 2026, respectively.
• The certified performance shares will vest on June 11, 2027.

Key Dates