Exhibit 10
TERMS OF OFFER LETTER BETWEEN
UNITED STATES CELLULAR CORPORATION
AND XXXX X. XXXXXX
The following are the material terms of the Offer Letter by United
States Cellular Corporation ("USCC") and accepted by Xxxx X. Xxxxxx on March 28,
2000 relating to his employment as President and Chief Executive Officer of
USCC.
o A base salary at the annual rate of $450,000 per year through December 31,
2000, with a performance review following year-end 2000.
o Assuming a start date of April 10th, Xx. Xxxxxx will receive a minimum
prorated (9 months) bonus of $169,000 for 2000, which is based on 50% of
his base pay rate ($450,000 x .5 = $225,000. $225,000 x .75 = $168,750). If
Xx. Xxxxxx and his team exceed business plan objectives, his 2000 bonus
could increase. Starting in 2001, Xx. Xxxxxx'x target bonus opportunity
will be 50% of his base salary for the year and be based on USCC's results
for the year versus those targeted in USCC's senior management bonus
program. With superior performance, he will be eligible for bonus awards
significantly above the targeted 50% level.
o Ability to defer salary and/or bonus payments.
o Participation in the USCC Long-Term Incentive Programs as follows:
o A grant of 55,000 USCC stock options, effective on Xx. Xxxxxx'x first
day of employment with USCC at a strike price equal to the closing
price of USCC's stock on that date. This grant will vest in 5 equal
annual installments, with the first 20% vesting one year after the date
of the grant.
o An annual grant of USCC restricted stock. The first annual restricted
stock grant effective March 31, 2001, will be for the 2000 performance
year.
o The target number of restricted stock shares for 2000 is that number which
provides the same estimated present value, at the time of the award, as the
present value at Xx. Xxxxxx'x start date of one-fifth of his up front stock
option grant. The actual number of restricted shares that Xx. Xxxxxx earns
in any year will be in direct proportion to the percentage of the target
team bonus that is earned under USCC's top management incentive program for
that year. The number of shares earned in any year will range from zero to
whatever percentage above target is earned under this incentive program for
that year.
The restricted stock shares will fully vest three years from the date of
the grant. When they vest, Xx. Xxxxxx can choose to have them paid out in
either stock or cash.
o Accelerated vesting after six years of service. After Xx. Xxxxxx'x
sixth anniversary with USCC, all previously granted but unvested
granted stock option and restricted stock awards will fully vest no
later than six months after the date of such sixth anniversary. Stock
option awards and restricted stock awards made after Xx. Xxxxxx'x sixth
anniversary date with USCC will fully vest six months after the date
they are granted.
o A seat on the USCC Board.
