Form 4: TDS Executive Vicki L. Villacrez Reports Acquisition of Restricted Stock Units and Performance Share Units

Executive Vice President & CFO Vicki L. Villacrez reports acquisition of restricted stock units and performance share units in Telephone & Data Systems Inc.

Summary

• Vicki L. Villacrez, Executive Vice President & CFO of Telephone & Data Systems Inc. (TDS), filed a Form 4 on May 22, 2025, reporting changes in beneficial ownership.
• On May 21, 2025, Villacrez acquired 16,434 restricted stock units and 3,907 performance share units.
• The restricted stock units 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.
• The reported performance share units reflect a 75% floor, which may increase to 100% if the UScellular transaction with T-Mobile closes in 2025.
• Dividend equivalents accumulate on the performance share units but are forfeitable if performance metrics are not achieved.

Sentiment

Score: 7

Explanation: The sentiment is neutral to slightly positive. The granting of stock units is a routine part of executive compensation and aligns management with shareholder interests. The potential upside from the UScellular transaction is a positive factor.

Positives

• The grant of restricted stock units and performance share units aligns the executive's interests with the long-term performance of the company.
• The performance-based component of the award incentivizes the executive to achieve key performance metrics.
• The potential increase in performance share units upon the closing of the UScellular transaction with T-Mobile provides an additional incentive.

Risks

• The performance share units are subject to forfeiture if the performance metrics are not achieved.
• The value of the restricted stock units and performance share units is subject to the market price of TDS common shares.

Future Outlook

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

Industry Context

Executive compensation packages often include a mix of restricted stock units and performance-based awards to align management's interests with shareholder value. The inclusion of UScellular performance as a key metric reflects the importance of the UScellular transaction with T-Mobile to TDS's overall strategy.

Comparison to Industry Standards

• Executive compensation packages in the telecommunications industry typically include a mix of base salary, bonus, stock options, and restricted stock units.
• Performance-based awards are common, with metrics often tied to revenue growth, profitability, and subscriber acquisition.
• Companies like Verizon and AT&T also use similar compensation structures to incentivize their executives.

Stakeholder Impact

• The granting of equity-based compensation can align management's interests with those of shareholders.
• The performance-based component can incentivize management to improve company performance, benefiting shareholders and potentially employees.

Next Steps

• Potential filing of another Form 4 if the UScellular transaction with T-Mobile closes in 2025, reflecting an increase in the floor of the performance share units.

Key Dates

Keywords

Form 4, beneficial ownership, restricted stock units, performance share units, TDS, Telephone & Data Systems, Vicki L. Villacrez, executive compensation, UScellular, T-Mobile