US Cellular 2008 Annual Report Download - page 60

For the definition of Change in Control, see U.S. Cellular’s 2005 Long-Term Incentive Plan, attached
as Exhibit C to this proxy statement.
Because certain termination events and/or a Change in Control would or may result in the
acceleration of vesting of stock options, restricted stock units and bonus match units, the effects of such
accelerated vesting in such event are included in the below table of Potential Payments upon Termination
or Change in Control.
SERP
Each of the identified executive officers participates in a supplemental executive retirement plan or
SERP, which is a non-qualified defined contribution plan. The SERP does not provide substantial benefits
and is intended to replace the benefits which cannot be provided under the TDS Pension Plan as a
result of tax law limitations on the amount and types of annual employee compensation which can be
taken into account under a tax qualified pension plan. The SERP is unfunded. The amount of the
contribution with respect to the executives identified in the Summary Compensation Table is included in
column (i), ‘‘All Other Compensation,’’ of the Summary Compensation Table. Participants are credited
with interest on balances of the SERP. Pursuant to SEC rules, column (h) of the Summary Compensation
Table includes any portion of interest earned under the SERP to the extent the rate exceeds 120% of the
applicable federal long-term rate, with compounding (as prescribed under section 1274(d) of the Internal
Revenue Code), at the time the rate is set.
A participant is entitled to distribution of his entire account balance under the SERP if the participant
has a separation from service without cause, after either (a) his or her attainment of age 65; or (b) his or
her completion of at least ten years of service. If a participant has a separation from service under
circumstances other than those set forth in preceding sentence, without cause, the participant will be
entitled to distribution of 10% of his or her account balance for each year of service up to ten years.
Upon a separation from service under circumstances that permit payments under the SERP, the
participant will be paid his or her account balance in one of the following forms as elected by the
participant prior to the first day of the first plan year for which the participant commences participation in
the SERP: (a) a single lump sum or (b) annual installments over a period of 5, 10, 15, 20 or 25 years.
The SERP does not include any provision that would increase benefits or accelerate amounts upon any
termination or change in control and, accordingly, no amount is included in the below table of Potential
Payments upon Termination or Change in Control. The balance of the SERP as of December 31, 2008 for
each named executive officer is set forth in the ‘‘Nonqualified Deferred Compensation’’ table below.
Perquisites
U.S. Cellular does not provide any significant perquisites to its executive officers. In addition, U.S.
Cellular has no formal plan, policy or procedure pursuant to which executive officers are entitled to any
perquisites following termination or change in control. However, in connection with any termination, U.S.
Cellular may enter into a retirement, severance or similar agreement that may provide for perquisites.
Perquisites and personal benefits represent a relatively insignificant portion of the named executive
officers’ total compensation. Accordingly, they do not materially influence the Chairman’s or Stock Option
Compensation Committee’s consideration in setting compensation.
53