Current Report Filing (8-k)
April 21 2015 - 12:17PM
Edgar (US Regulatory)
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): April 17, 2015
UNITED STATES CELLULAR CORPORATION
(Exact name of registrant as specified in its charter)
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Delaware
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1-9712
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62-1147325
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(State or other jurisdiction of
incorporation or organization)
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(Commission
File Number)
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(I.R.S. Employer Identification No.)
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8410 West Bryn Mawr, Chicago, Illinois
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60631
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(Address of principal executive offices)
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(Zip Code)
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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):
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Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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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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Item 5.02. Departure of Directors or Certain
Officers; Election of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
The
following information is being provided pursuant to paragraph (e) of Item 5.02
of Form 8-K:
United
States Cellular Corporation’s 2015 Executive Officer Annual Incentive Plan.
As
of April 17, 2015, the United States Cellular Corporation (“U.S. Cellular”)
2015 Executive Officer Annual Incentive Plan Effective January 1, 2015 (“2015
Incentive Plan”) was approved by both U.S. Cellular’s Chairman and by U.S.
Cellular’s President and Chief Executive Officer. Neither the Chairman nor the
President and Chief Executive Officer participate in such plan.
The
purposes of the 2015 Incentive Plan are: to provide incentive for the executive
officers of U.S. Cellular to extend their best efforts toward achieving
superior results in relation to key business performance targets; to reward
U.S. Cellular’s executive officers in relation to their success in meeting and
exceeding the performance targets; and to help U.S. Cellular attract and retain
talented leaders in positions of critical importance to the success of U.S.
Cellular. Eligible participants in the 2015 Incentive Plan are all executive
officers of U.S. Cellular, which are defined in the 2015 Incentive Plan as all
executive vice presidents and the senior vice president – chief human resources
officer.
The
following performance measures will be considered for the purposes of the 2015
Incentive Plan:
Company Performance
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Component Weighting
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Overall Plan Weighting
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Consolidated Total Revenues
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40%
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24%
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Consolidated Adjusted
Earnings Before Interest, Taxes, Depreciation and Amortization
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35%
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21%
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Consolidated Capital
Expenditures
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25%
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15%
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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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It
is anticipated that bonuses for 2015 will be paid on or after January 1, 2016
but no later than March 15, 2016. No bonus is due unless an executive
officer remains employed through the bonus payout date except that an executive
officer who separates due to retirement or death is eligible for a pro-rated
bonus. In addition, the President and CEO may approve a bonus, or a pro-rated
bonus, for an executive officer who is not employed through the bonus payout
date.
Any
compensation earned or paid pursuant to the 2015 Incentive Plan is subject to
forfeiture, recovery by U.S. Cellular, or other action pursuant to any clawback
or recoupment policy which U.S. Cellular may adopt from time to time, including
without limitation any such policy which U.S. Cellular may be required to adopt
under the Dodd-Frank Wall Street Reform and Consumer Protection Act and
implementing rules and regulations thereunder, or as otherwise required by
law.
The
foregoing description of the 2015 Incentive Plan is not purported to be
complete with respect to the material terms of such plan and is qualified by
reference to the complete 2015 Incentive Plan for the material terms of such
plan, which is filed herewith as Exhibit 10.1 and incorporated by reference
herein.
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.
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, thereto
duly authorized.
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United States
Cellular Corporation
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(Registrant)
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Date:
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April 21, 2015
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By:
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/s/ Steven T.
Campbell
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Steven T.
Campbell
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Executive Vice
President - Finance,
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Chief
Financial Officer and Treasurer
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EXHIBIT INDEX
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The following exhibits are filed or
furnished herewith as noted below.
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Exhibit
No.
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Description
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10.1
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United States
Cellular Corporation 2015 Officer Annual Incentive Plan Effective January 1,
2015
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Exhibit 10.1
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UNITED STATES
CELLULAR CORPORATION
2015 EXECUTIVE
OFFICER ANNUAL INCENTIVE PLAN
Effective January 1,
2015
I. PURPOSE
Ø
To provide incentive for the
executive officers of U.S. Cellular to extend their best efforts towards
achieving superior results in relation to key business performance targets;
Ø
To reward U.S. Cellular executive
officers in relation to their success in meeting and exceeding the performance
targets; and
Ø
To help U.S. Cellular attract and
retain talented leaders in positions of critical importance to the success of
the Company.
II. ELIGIBLE PARTICIPANTS
All U.S. Cellular Executive
Officers are eligible to participate in this 2015 Executive Officer Annual
Incentive Plan (“Plan”). Executive officers includes all Executive Vice
Presidents and the Senior Vice President - Chief Human Resources Officer.
III. PERFORMANCE MEASURES & WEIGHTINGS
Performance Measures
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Component Weighting
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Overall Plan Weighting
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Consolidated Total Revenues
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40%
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24%
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Consolidated Adjusted Earnings
Before Interest, Taxes, Depreciation and Amortization
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35%
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21%
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Consolidated Capital
Expenditures
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25%
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15%
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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. PERFORMANCE MEASURES DEFINITIONS
Company Performance -
Weighting 60%: Actual performance will be assessed against the targeted
performance for each performance measure. The performance measures are defined
below.
Consolidated
Total Revenues: Total revenues
determined on a consolidated company-wide basis and in a manner
consistent to U.S. Cellular's presentation of total revenues for external
reporting purposes.
Consolidated Adjusted
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA): Adjusted EBITDA determined on a
consolidated company-wide basis and in a manner consistent to U.S.
Cellular's presentation of Adjusted EBITDA for external reporting purposes.
Consolidated
Capital Expenditures: Capital
expenditures determined on a consolidated company-wide basis and in a
manner consistent to U.S. Cellular's presentation of capital expenditures
for external reporting purposes. The measurement of actual capital
expenditures against targeted capital expenditures may not be sufficiently
comprehensive because it would measure actual expenditures, but not necessarily
the efficiency and/or productivity of those expenditures. Therefore, if
appropriate, the measurement of actual expenditures against targeted
expenditures could incorporate an adjustment for spending
efficiency/productivity which could include an assessment of the degree of
completion of certain projects. The determination of whether such an
adjustment is appropriate and the amount of the adjustment will be made by the
President and CEO and will be subject to the review and approval of the
Chairman.
Notes:
§
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.
§
The Chairman in his discretion may
adjust targets to reflect unanticipated events.
Chairman Assessment on Strategic Initiatives -
Weighting: 10%:
The
Chairman in his qualitative and subjective assessment of U.S. Cellular’s
overall company performance during the year will consider the following key
factors and any other information he deems relevant in determining the level of
attainment for this measure:
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Achievement of key goals and
objectives provided to the U.S. Cellular board of directors.
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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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Developing and enhancing
strategies and plans that strengthen the Company’s ability to successfully
compete in the marketplace.
Individual Performance -
Weighting: 30%:
Each
executive officer’s overall performance for the year will be assessed by the
President and CEO based on such executive officer’s effectiveness/success with
regard to:
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Carrying out
his/her ongoing responsibilities and key initiatives during the performance
year.
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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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Associate
engagement as measured in large part by the Company’s culture survey.
In
making these assessments, the President and CEO also will take into
consideration:
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Evaluation of
the executive officer’s performance in the above areas.
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Performance
feedback received on the executive officer.
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The executive
officer’s report on his/her activities/accomplishments for the performance
year.
V. MISCELLANEOUS PROVISIONS
The Plan is subject to the
Administrative Guidelines attached hereto as Exhibit A. U.S. Cellular reserves
the right to amend or discontinue the Plan at any time, with or without
notice.
There are no oral or written
agreements or understandings between U.S. Cellular and the participants
affecting or relating to this Plan not referenced herein. If the
participant fails to adhere to the ethical and legal standards as referenced by
U.S. Cellular policy, U.S. Cellular shall have the right to revoke this Plan,
reduce or eliminate compensation as it applies to the violator, or any other
remedy as provided by corporate policy or law.
Any compensation earned or paid
pursuant to this Plan is subject to forfeiture, recovery by U.S. Cellular or
other action pursuant to any clawback or recoupment policy which U.S. Cellular
may adopt from time to time, including without limitation any such policy which
U.S. Cellular may be required to adopt under the Dodd-Frank Wall Street Reform
and Consumer Protection Act and implementing rules and regulations thereunder,
or as otherwise required by law.
This program shall not be
construed as an employment contract or as a promise of continuing employment
between U.S. Cellular and the associate. Employment with U.S. Cellular is
terminable at will, i.e., either the participant or U.S. Cellular may terminate
the relationship at any time, with or without cause.
/s/ Kenneth R.
Meyers
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4/6/15
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President and
CEO
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Date
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/s/ LeRoy T.
Carlson, Jr.
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4/17/15
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Chairman
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Date
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VI. BONUS RANGES AS A PERCENT OF
TARGET
The bonus ranges were set to
reinforce the Company’s pay for performance culture. Minimum performance
levels for each component need to be achieved before any bonus is earned.
The ranges result in substantial reductions in bonuses when targets are not
achieved, and greater rewards for above target performance.
Company Performance
Measures:
Performance Measure
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Minimum
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Maximum
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Consolidated
Total Revenues
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90%
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110%
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Consolidated
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization
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80%
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120%
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Consolidated
Capital Expenditures
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105%
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90%
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Bonus Payouts As A Percent
Of Target At Minimum, And Maximum Performance Levels:
Performance Measure
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Minimum
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Target
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Maximum
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Consolidated
Total Revenues
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50%
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100%
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225%
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Consolidated
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization
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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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Bonus
payouts between the minimum and target performance levels and between the
target and maximum performance levels will be computed by interpolation. Any
bonus for performance below the minimum level will be determined and approved
at the discretion of the Chairman.
Chairman Assessment on
Strategic Initiatives:
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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Significantly exceeds
target performance: Performance
significantly exceeded that which was planned and expected.
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120% - 150%
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Somewhat exceeds/fully
meets / almost fully 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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Well below target
performance: Given the conditions
that prevailed, performance was not sufficient across all components of the
Plan to merit any bonus.
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0%
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Individual Performance:
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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Exhibit
A
Administrative
Guidelines
PLAN YEAR EFFECTIVE DATES:
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January 1, 2015 – December
31, 2015
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GENERAL ADMINISTRATION:
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The target annual bonus
payout for plan participants will be based on the associate’s base salary as
of December 31, 2015.
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VESTING
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The bonus does not vest and
no bonus shall be paid unless the associate remains employed through the
actual bonus payout date. Special rules apply to those associates who retire
or die before the actual bonus payout date (see below).
To the extent and only to the
extent that any bonus is paid for the plan year, such bonus shall be deemed
to have been earned on December 31, 2015.
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SEPARATION PRIOR TO PAYOUT VESTING DATE
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Not eligible for a payout
unless separation is because of retirement or death (see below), or unless
approved by the President and CEO.
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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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RETIREMENT / DEATH
Prior
to Payout Vesting Date
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Payout based on a proration
for time worked during the plan year.
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Leave of Absence
(Including FMLA and Military)
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Associates on Leave of Absence are
eligible for a payout based on proration for time worked during the plan
year, individual performance and the plan component attainment
percentages.
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TRANSFERS/PROMOTIONS DURING PLAN YEAR
Within/ Between Annual Plans:
Between an Annual Plan and a Quarterly or Monthly Plan:
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If an associate is promoted /
transferred within or between annual incentive plan(s), no prorations will be
made in determining the associate’s target bonus. The associate’s target
bonus will be based on the associate’s plan as of 12/31/15.
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
last base salary 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 associate transfers
to/from another TDS business unit, he/she will receive a prorated payout
based on the factors listed above.
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BONUS PAYOUT DATE
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Bonuses are to be paid during
the period commencing on January 1, 2016 and ending on March 15, 2016. Historically,
bonuses have been paid in March on or before March 15th of the
year following the end of the plan year (12/31). Notwithstanding the
foregoing, in the event that payment by March 15, 2016 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, 2016, but in no event
later than December 31, 2016. Payment will be in the form of a lump sum.
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