Walter C. D. Carlson
Chair of the Board, President and Chief Executive Officer at 
TELEPHONE & DATA SYSTEMS INC /DE/
TELEPHONE & DATA SYSTEMS INC /DE/CEO
Executive
Board
About Walter C. D. Carlson
Walter C. D. Carlson is Chair of the Board and, since February 1, 2025, President and Chief Executive Officer of Telephone and Data Systems (TDS); he is 71 years old, has served as a TDS director since 1981, was non‑executive Chair from 2002–Jan 2025, and became Chair+CEO in Feb 2025; he holds a J.D. from Harvard University and has long been a trustee/beneficiary of the TDS Voting Trust that controls TDS . TDS’ 2024 operational execution included agreements to sell UScellular’s wireless operations and spectrum to T‑Mobile and additional spectrum to AT&T and Verizon, divested OneNeck IT Solutions, and executed sales of certain ILEC/cable properties, while 2024 company bonus performance scored 104.2% of target on weighted UScellular/TDS Telecom metrics (a mix of service revenue/EBITDA/capex and net adds) . TDS emphasizes pay‑for‑performance using Return on Capital, Total Operating Revenues, Adjusted EBITDA and relative TSR in its long‑term incentives, with oversight by an independent CHRC and a Dodd‑Frank‑compliant clawback adopted in 2023 . Governance is shaped by a dual‑class, controlled structure (Voting Trust aggregate 56.8% voting power in matters other than director elections) and a combined Chair/CEO model with a Lead Independent Director to bolster independent oversight .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Telephone and Data Systems (TDS) | Director; Chair of the Board (non‑executive 2002–Jan 2025; Chair+CEO from Feb 1, 2025) | Director since 1981; Chair since 2002; CEO since Feb 1, 2025 | Long‑tenured board leadership during major strategic transactions (UScellular asset sales; portfolio reshaping); provides shareholder perspective as Voting Trust trustee . |
| Sidley Austin LLP | Senior Counsel (previously Partner >5 years) | Senior Counsel 2023–Jan 2025; Partner prior 5+ years | External legal/advisory experience; firm provides legal services to TDS and UScellular (see related‑party) . |
| United States Cellular (UScellular) | Director | Since 1989 | Oversight of wireless subsidiary during strategic alternatives review and spectrum/operations sale processes . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| UScellular | Director | Since 1989 | Current public company board . |
| Aerial Communications, Inc. | Director (former) | n/a | Prior public board service . |
| TDS Voting Trust | Trustee/Beneficiary | Current | Trustee/beneficiary of controlling trust (expires June 30, 2035) . |
Fixed Compensation
| Component | 2024 | 2025 (CEO) |
|---|---|---|
| Base salary | n/a (non‑employee director) | $850,000 . |
| Annual cash retainer (director) | $169,000 (as non‑employee director) | n/a (becomes employee CEO) . |
| Director equity retainer | $121,660 (6,320 TDS shares at $19.25) | n/a (CEO) . |
| Target annual bonus | n/a (director) | 115% of base salary (discretionary determination by CHRC) . |
| Long‑term incentive target | n/a (director) | $3,000,000 target; anticipated 60% PSUs / 40% RSUs . |
Notes: Non‑employee director pay schedule in 2024 was $90,000 cash retainer, $25,000 Lead Independent Director premium (if applicable), $1,750 per meeting, and $120,000 equity retainer in TDS shares; Chair of the Board retainer $110,000 (when non‑employee); Walter received $169,000 fees and $121,660 stock in 2024 before becoming CEO .
Performance Compensation
- 2025 CEO bonus design: Target of 115% of base; CHRC retains discretion on amount; CEO will participate in standard TDS executive bonus framework that weights company and individual performance (recent NEO programs: 80% company / 20% individual) .
- 2025 LTI design: Anticipated $3.0M target delivered 60% in performance share units (PSUs) and 40% in restricted stock units (RSUs), with vesting schedules consistent with TDS’ 2025 grants (RSUs pro‑rata 1/3 over 3 years; PSUs vest on 3rd anniversary after performance certification) .
Recent PSU structure (reference for expected metrics/vesting cadence):
| Metric | Weighting | Performance period | Payout range | Vesting |
|---|---|---|---|---|
| UScellular’s Performance Award Payout % | 32% | 1‑year (2024) | 0%–175% | Settled on 3rd grant anniversary (time‑based vest after certification) . |
| TDS Telecom Performance Award Payout % | 48% | 2‑year (2024–2025) | 0%–200% | Settled on 3rd grant anniversary (time‑based vest after certification) . |
| Relative TSR (vs peer group) | 20% | 3‑year (2024–2026) | 0%–200% | Settled on 3rd grant anniversary (time‑based vest after certification) . |
Oversight and guardrails:
- Clawback policy (Aug 2023) for erroneously awarded incentive compensation upon certain financial restatements (Dodd‑Frank/NYSE compliant) .
- Hedging/pledging prohibited and insider trading policy applies to directors/officers (no hedging, no pledging, no short sales or monetization/margin transactions) .
Context on committee discretion (signal for plan rigor):
- 2022 TDS PSUs certified at 85% payout after a 45% discretionary upward adjustment due to industry dynamics during UScellular strategic review; absent discretion, payout would have been 40% .
- For the 2024 UScellular component of TDS PSUs, attainment of 145.9% included a 24.8% adjustment (license impairment exclusion and mid‑band deployment pacing) .
Equity Ownership & Alignment
| Item | Detail (as of Mar 3, 2025, unless noted) |
|---|---|
| Direct beneficial ownership (Walter C. D. Carlson) | 218,147 TDS Common Shares; 28,739 Series A Common Shares (<1% of each class) . |
| Interests via TDS Voting Trust (for Walter’s benefit) | Voting Trust aggregate holds 7,206,297 Series A and 6,298,354 Common; for Walter’s benefit within the Trust: 2,445,655 Series A and 2,089,948 Common (not counted in his direct line; see footnotes) . |
| Voting control context | Voting Trust has ~54.2% voting power in matters other than director elections; aggregate Series A voting power 56.7% in such matters . |
| Vested/unvested awards (Walter) | As a 2024 non‑employee director, he received shares (not RSUs/PSUs); CEO equity grants to begin with 2025 cycle; RSUs typically vest 1/3 per year, PSUs settle after 3 years subject to performance . |
| Pledging/hedging | Prohibited for directors/officers; policy bars pledging, hedging, short sales, monetization/margin transactions . |
| Share pledges | Proxy indicates “none of the above shares are pledged as security” absent footnote exceptions; no pledging flagged for Carlson . |
| Director stock ownership guidelines | Directors must hold TDS shares valued at $270,000 (3× $90,000 retainer) within 3 years of becoming a director; applies to Walter as a director . |
Employment Terms
| Term | Provision | Notes |
|---|---|---|
| Employment agreement | Not disclosed | 2025 management transition outlines salary/bonus/LTI targets; no fixed‑term contract disclosed . |
| Severance policy | TDS has no general severance plan for NEOs; potential payments primarily from equity acceleration under LTIP upon qualifying events | Designed so executives are “neither harmed nor given a windfall”; controlled‑company context cited . |
| Change‑in‑control (CIC) equity treatment | Under LTIP, equity may accelerate upon CIC/qualified termination; PSUs paid based on greater of target or actual after restriction period; acceleration on death/disability/qualified retirement/good reason or without cause during restriction period . | |
| Clawback | Companywide clawback adopted Aug 2023 per SEC/NYSE rules . | |
| Non‑compete / non‑solicit | Not disclosed for TDS executives in proxy; UScellular CEO has separate letter agreement (informational) . | |
| Insider trading | Strict policy; prohibits hedging/pledging/shorts by directors/officers . |
Board Governance
- Dual role: Carlson serves as both Chair and CEO effective Feb 1, 2025; Board deemed combined roles appropriate given his Voting Trust position, ownership, and tenure as non‑executive Chair; Lead Independent Director (Christopher D. O’Leary) designated concurrently to reinforce independent oversight .
- Committee roles: Carlson chairs the Corporate Governance & Nominating Committee (CGNC); CGNC includes both independent and non‑independent directors consistent with controlled‑company exemptions .
- Independence and structure: TDS is a controlled company under NYSE rules; maintains an all‑independent CHRC and Audit Committee; overall Board currently 6 independent and 6 non‑independent directors .
- Meetings/attendance: In 2024, the Board held 23 meetings (7 regular, 16 special) with each director attending at least 75% of Board and assigned committee meetings (elevated activity related to UScellular’s strategic review) .
Director Compensation (2024 context, pre‑CEO)
| Item | Amount |
|---|---|
| Fees earned (cash) | $169,000 . |
| Stock awards | $121,660 (6,320 shares at $19.25) . |
| All other compensation (life insurance premium) | $107 . |
| Total | $290,767 . |
Non‑employee director program schedule (for reference): $90,000 cash retainer; $110,000 if non‑employee Chair; $25,000 Lead Independent Director premium; $1,750 per Board/committee meeting; Audit/CHRC/CGNC chair/member retainers; $120,000 annual equity grant in TDS shares .
Performance & Track Record (company results under board leadership)
- 2024 strategic actions: Transactions to sell UScellular’s wireless operations and spectrum to T‑Mobile; additional spectrum sales to AT&T and Verizon; sale of OneNeck IT Solutions; TDS Telecom executed sales of certain small ILEC/cable properties—portfolio simplification and cash generation focus .
- Incentive outcomes: 2024 TDS corporate bonus performance calculated at 104.2% of target, reflecting UScellular (113%) and TDS Telecom (90.9%) sub‑scores across revenue/EBITDA/capex and broadband net adds metrics .
- Pay‑versus‑performance linkages: Company highlights Return on Capital, Total Operating Revenues, and Adjusted EBITDA as most important measures linking compensation to performance; relative TSR is also embedded in PSUs .
Compensation Structure Analysis (signals)
- At‑risk mix: As CEO, 2025 pay mix skews to variable compensation—target bonus 115% of base and $3.0M LTI (60% PSUs) indicating performance orientation .
- Discretion use: 2022 TDS PSUs were increased by 45% at certification due to industry dynamics; and 2024 UScellular performance attainment included a 24.8% adjustment—this discretion improves retention but can dilute pay‑for‑performance purity (monitor CHRC rationale) .
- Equity vehicle shift: Current LTI uses PSUs and RSUs; RSUs vest ratably, which reduces risk vs options; PSUs maintain performance leverage via multi‑metric design (0–200% caps) .
- Perquisites and tax gross‑ups: Company highlights “few perquisites” and generally no gross‑ups; prohibits hedging/pledging—shareholder‑friendly features .
Compensation Peer Group (benchmarking)
TDS/CHRC used Compensation Strategies’ 2024 industry peer group for competitive review: Altice USA, American Tower, ATN International, Cable One, Consolidated Communications, Crown Castle, DISH, EchoStar, Equinix, IDT, Iridium, Lumen, SBA Communications, ViaSat, WideOpenWest; plus WTW survey data; no conflicts found with advisors .
Say‑on‑Pay & Shareholder Feedback
- 2024 Say‑on‑Pay support: ~77% approval; CHRC made no significant program changes in response .
- Board refreshment and tenure: Shareholder concerns about tenure prompted addition of new independent director (Napoleon B. Rutledge, Jr.) in Dec 2024 and election of a Lead Independent Director in early 2025 .
Related‑Party Transactions (governance considerations)
- Sidley Austin LLP legal services to TDS/UScellular: $19M (2024), $16M (2023), $8M (2022); Walter Carlson was Senior Counsel at Sidley through Jan 31, 2025; TDS GC (or Assistant Secretary) is a Sidley partner—ongoing related‑party engagement to monitor .
- Family employment: Anthony J. M. Carlson (Voting Trust trustee and family member) employed at UScellular (Senior Director Growth Marketing) and transferred to TDS Telecom (VP Organizational Transformation) in 2024; 2024 salary ~$219,981 and 2024 bonus $91,300; received $101,527 in 2024 stock awards .
Equity Vesting & Insider Selling Pressure
- Upcoming vesting cadence (CEO grants beginning 2025): RSUs typically vest 1/3 annually on grant anniversaries; PSUs settle after 3 years subject to performance; this creates discrete vesting dates (potential liquidity windows) from 2026 onward for Carlson’s CEO awards .
- Pledging/hedging risk: Policy prohibits pledging/hedging; proxy footnotes indicate no pledged shares absent disclosure; reduces forced‑sale risk .
Board Governance: Dual‑Role Implications
- Combined Chair/CEO with CGNC chaired by the CEO raises independence optics, mitigated by Lead Independent Director authority (exec sessions, agenda review, CEO evaluation leadership) and independent Audit/CHRC structures; TDS relies on controlled‑company exemptions but voluntarily maintains independent CHRC .
- Voting Trust control (56.8% voting power in non‑director matters) limits outside shareholder influence and can stabilize long‑term strategy while constraining activist outcomes .
Investment Implications
- Alignment: 2025 CEO package (115% target bonus; $3.0M LTI with 60% PSUs) and multi‑metric PSU design (operational and relative TSR) align pay with performance; strict anti‑hedging/pledging and clawback bolster alignment .
- Watch items: Discretionary PSU adjustments (e.g., 45% uplift on 2022 awards; 24.8% in 2024 UScellular component) and combined Chair/CEO with CEO‑chaired CGNC merit continued scrutiny for governance rigor and pay‑for‑performance fidelity .
- Retention and overhang: Equity vests over 3 years with meaningful PSU weighting, supporting retention; absence of large severance/CIC cash multiples reduces parachute risk but equity acceleration can still be material in a CIC/termination scenario .
- Control dynamics: Voting Trust control and dual‑class structure provide strategic continuity through portfolio reshaping (UScellular transaction set) but constrain external governance levers; performance delivery and transparent CHRC judgment will be key to sustain say‑on‑pay support (~77% in 2024) .