8-KLeadership Changes

T-Mobile US, Inc. 8-K Report, Executive Changes (Feb 19, 2020)

Filed February 19, 2020For Securities:TMUSTMUSZTMUSITMUSL

Summary

This 8-K filing from T-Mobile US, Inc. (TMUS) details an amendment to the employment compensation term sheet for Executive Vice President, Corporate Services, David Carey. The amendment primarily extends Mr. Carey's employment through July 1, 2020, or an earlier "Position Elimination Date," which is expected between April 30, 2020, and July 1, 2020. His base salary and short-term incentive targets remain unchanged, but he will generally not be eligible for new long-term incentive awards after the amendment's effective date. The filing also outlines severance benefits and a potential consulting agreement for Mr. Carey in the event of a "Qualifying Termination." This includes severance payments and eligibility for the company's mobile service discount program. Additionally, a consulting agreement for services up to five days per month for a year following termination is stipulated. Notably, Mr. Carey is waiving certain "good reason" resignation rights related to duties if he continues to report to CEO John Legere until Mr. Legere's own departure.

Key Highlights

  • 1Amendment to David Carey's employment agreement extends his tenure through July 1, 2020, or an earlier "Position Elimination Date".
  • 2Mr. Carey's base salary remains $775,000 annually, and his target short-term incentive remains 150% of base earnings ($1,162,500).
  • 3Mr. Carey will generally not be eligible for new Long-Term Incentive (LTI) awards after the amendment's effective date.
  • 4Upon a "Qualifying Termination" (defined as termination by T-Mobile without cause, or by Mr. Carey for good reason), Mr. Carey is entitled to severance benefits outlined in a prior Severance Letter.
  • 5A consulting agreement is to be entered into post-Qualifying Termination, with Mr. Carey providing services for up to five days per month for a 12-month period for a fee of $41,677 per month.
  • 6Mr. Carey waives rights to resign for "good reason" due to duty diminishment as long as he reports to CEO John Legere until Mr. Legere's departure.

Frequently Asked Questions

The main change is the extension of Mr. Carey's employment term through July 1, 2020, or an earlier "Position Elimination Date." It also clarifies that he will generally not be eligible for new long-term incentive awards.

Upon a "Qualifying Termination" (termination by T-Mobile without cause, or by Mr. Carey for good reason), Mr. Carey is entitled to severance benefits as outlined in his prior Severance Letter. He will also continue to be eligible for T-Mobile's mobile service discount program.

Following a Qualifying Termination, T-Mobile and Mr. Carey will enter into a consulting agreement. He will provide consulting services for up to five days per month for 12 months in exchange for a fee of $41,677 per month, subject to mutual agreement on terms and conditions.

Yes, Mr. Carey has waived certain rights to resign for "good reason" due to a diminishment of duties, provided he continues to report directly to CEO John Legere until Mr. Legere's own employment with T-Mobile terminates.