DEF 14A of Lumen Technologies, Inc.

Filed Apr 6, 2026 · FY20250000018926-26-000024

Open on EDGAR

Director Nominees
Director Nominees See “Board of Director and Governance—Our Director Nominees” for information about each of the nine nominees for election to our Board.
Director Nominees
| | The Board unanimously recommends a vote FOR each of the director nominees |
Director Nominees
| | | 17 | | 2025 ANNUAL REPORT | 2026 PROXY STATEMENT | |
Director Nominees
| Board of Directors and Governance |
Our Director Nominees
Our Director Nominees The first item for consideration at the meeting will be the election of the nine nominees listed below. The information about each Board committee reflects its anticipated membership and leadership following the 2026 annual meeting, assuming each of the nominees is elected.
Our Director Nominees
| Quincy L. Allen INDEPENDENT 66 years old Director since: 2021 Committees: HRC (Chair), NCG Skills: | Experience Quincy L. Allen has over 35 years of leadership experience in the technology services industry. IBM Corporation, a publicly traded multinational technology company •Go-To-Market Leader of Cognitive Process Services and Chief Marketing Officer for IBM Cloud (2015 to 2018) Unisys Corporation, a publicly traded global information technology company •Chief Marketing and Strategy Officer (2012 to 2015) Vertis Communications, a direct marketing and advertising company •Chief Executive Officer (2009 to 2010) | Xerox Corporation, a publicly traded global provider of digital print technology and related solutions (1982-2009) •President of the Global Services and Strategic Marketing Group •President of Production Systems Group Other Public Company Directorships •ABM Industries, Inc. (since 2021) (member of Audit and Stakeholder and Enterprise Risk Committees) Previous Public Company Directorships •Office Depot (2020-2025) |
Our Director Nominees
| Martha Helena Béjar INDEPENDENT 64 years old Director since: 2016 Committees: HRC, NCG (Chair) Skills: | Experience Martha Helena Béjar brings decades of leadership experience in technology, telecommunications, private equity, and corporate governance. DaGrosa Capital Partners LLC, a private equity firm •Senior Partner/Advisor (2022 to present) Red Bison Advisory Group, LLC, which provides business advisory services •Co-founder and principal (2012 to 2019) Unium, Inc., a Wi-Fi technology provider •Chief Executive Officer (2016 to 2018) Flow Mobile, Inc., a broadband wireless company •Chief Executive Officer (2012 to 2015) Infocrossing, Inc., a U.S.-based cloud services affiliate of Wipro Limited •Chief Executive Officer and Chairperson (2011 to 2012) Wipro’s Information Technology Services affiliate •President of Worldwide Sales and Operations (2009 to 2011) | Microsoft Corporation, a publicly traded multinational technology conglomerate •Corporate Vice President for the communications sector (2007 to 2009) Other •Prior to 2007, Ms. Béjar held diverse executive sales, operations, engineering and R&D positions at Nortel and Bellcore/Bellsouth/AT&T. Other Public Company Directorships •Commvault Systems (since 2018) (chair of Nominations and Governance Committee and member of the Audit Committee) •Sportsman’s Warehouse Holdings, Inc. (since 2019) (chair of Nominating and Governance Committee and member of Audit Committee) Previous Public Company Directorships •Mitel Networks Corporation (2017-2018) •Polycom, Inc. (2013-2016) •Quadient SA (2019-2025) |
Our Director Nominees
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Our Director Nominees
| Christopher Capossela INDEPENDENT 56 years old Director since: 2024 Committees: A, HRC Skills: | Experience Christopher Capossela is a senior executive in the technology industry with more than 30 years of experience working at Microsoft, where he spent the last eleven years of his career as its Executive Vice President and Chief Marketing Officer. Microsoft, a publicly traded multinational technology conglomerate (1991 to 2023) •Executive Vice President and Chief Marketing Officer (2014-2023) •Corporate Vice President, Consumer Channels Group (2013-2014) •Chief Marketing Officer (2011-2013) •Corporate Vice President, Office Marketing (2003-2011) | Other Public Company Directorships •None |
Our Director Nominees
| General Kevin P. Chilton INDEPENDENT 71 years old Director since: 2017 Committees: A Skills: | Experience General Kevin P. Chilton is retired from the U.S. Air Force as a four-star general and contributes considerable cybersecurity, risk management and scientific leadership experience to our Board. Chilton & Associates, LLC, a consulting company •President (2011-present) 34-year military career •Commander, U.S. Strategic Command (2007 to 2011), overseeing the U.S. Department of Defense’s nuclear, space and cyberspace operations •Commander, U.S. Air Force, Space Command (2006 to 2007) •NASA astronaut (1987 to 1996), including three space shuttle flights •Deputy Program Manager of the International Space Station (1996 to 1998) | Other Public Company Directorships •None Previous Public Company Directorships •Anadarko Petroleum Corporation (2011-2017) •AeroJet Rocketdyne (2018-2023) •Orbital ATK, Inc. (2015-2018) •Orbital Sciences Corporation (2012-2015) |
Our Director Nominees
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Our Director Nominees
| Michael Collins INDEPENDENT 61 years old Director since: Nominated for 2026 Committees: A, RS Skills: | Experience Michael Collins is a seasoned finance and strategy executive with over 30 years of experience in global management consulting, corporate strategy, and operational leadership. Bain & Company, a global management consulting firm. •Partner (2024–2026) •Chief Operating Officer (2021-2024) •Chief Financial Officer (2012-2021) •Various other roles (1998-2012) | Other Public Company Directorships •Jacobs Solutions, Inc. (2024–Present) Previous Public Company Directorships •Cosi, Inc. (2013-2017) |
Our Director Nominees
| Michelle J. Goldberg INDEPENDENT 56 years old Director since: 2025 Committees: A (Chair), RS Skills: | Experience Michelle J. Goldberg is a seasoned board director and transformation strategist with over 20 years of experience in early-stage technology businesses, finance, and governance. Ignition Partners, Venture Capital, an early-stage venture capitalist firm investing in technology sectors (2000 to 2023) •Partner Other •Prior to 2000, Ms. Goldberg was a consultant to financial institutions and Microsoft and an investment banker in middle market mergers and acquisitions | Other Public Company Directorships •Ally Financial since May 2025 (Audit committee member) Previous Public Company Directorships •Bakkt Holdings, Inc. (2021-2025) •Legg Mason, Inc. (2017-2020) •Taubman Centers, Inc. (2019-2020) •Plum Creek Timber Company, Inc. (2015-2019) |
Our Director Nominees
| | | 23 | | 2025 ANNUAL REPORT | 2026 PROXY STATEMENT | |
Our Director Nominees
| Kate Johnson 58 years old Director since: 2022 Committees: None Skills: | Experience Kate Johnson is a seasoned technology innovator with a proven track record of driving business transformation success at several Fortune 100 companies. Lumen •Chief Executive Officer (November 2022 to present) and President (November 2022 to March 2023) Microsoft Corporation, a publicly traded multinational technology conglomerate •President of Microsoft U.S., a division of Microsoft Corporation (2017 to 2021) GE, a publicly traded multinational conglomerate •Executive Vice President and Chief Commercial Officer, GE Digital (2016 to 2017) •Chief Executive Officer, GE Intelligent Platforms Software (2015 to 2016) •Vice President and Chief Commercial Officer (2013 to 2015) | Oracle, a publicly traded multinational technology company •Senior Vice President for North America Technology and Government Consulting (2007 to 2013) Red Hat, a publicly traded provider of enterprise open-source software products •Vice President of Global Services and Strategic Accounts (2004 to 2007) Other Public Company Directorships •United Parcel Service (since 2020) (member of Nominating and Corporate Governance and Risk Committees) |
Our Director Nominees
| Diankha Linear INDEPENDENT 52 years old Director since: 2024 Committees: NCG, RS (Chair) Skills: | Experience Diankha Linear is a senior executive and proven operator with more than 20 years of experience leading across highly regulated technology, logistics, and retail industries. Community, Inc., a technology startup that uses SMS to help brands engage with and retain their customers at scale •President & Chief Executive Officer (2021 to 2024) Convoy, Inc., an American technology and logistics company •General Counsel & Corporate Secretary (2017 to 2021) Nordstrom, a publicly traded American luxury specialty fashion retailer •Senior Director, Legal (2013 to 2017) | Expeditors International of Washington, a publicly traded global logistics company •Director, Legal (2008 to 2013) 16-year military career (1991 to 2007) •US Army Reserve—Paratrooper/Airborne, Logistics & Transportation •Civil Affairs—Special Operations Forces Unit •Judge Advocate General (JAG) Officer Prior Law Firm Practice •Perkins Coie LLP, Attorney Other Public Company Directorships •None |
Our Director Nominees
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Our Director Nominees
| Stephen McMillan INDEPENDENT 55 years old Director since: 2025 Committees: A, NCG Skills: | Experience Stephen McMillan is a visionary leader with a proven track record in driving global strategy, transforming organizations, and leading a top big data company, while championing value-based sales and developing high-performance teams. Teradata Corporation, a publicly-traded cloud and hybrid data and analytics company that provides a platform and services for enterprise analytics, including AI •President and Chief Executive Officer (2020 to present) F5, Inc., a publicly-traded transnational technology company specializing in security, cloud management, fraud prevention, and network performance •Executive Vice President of Global Services (2017 to 2020) | Oracle Corporation, a publicly-traded multinational technology company •Senior Vice President, Customer Success and Managed Cloud Services (2015 to 2017) •Senior Vice President, Managed Cloud Services (2012-2015) IBM Corporation, a publicly-traded multinational technology company •Vice President, IBM Strategic Outsourcing (2009 to 2012) •Held various increasingly senior leadership positions domestically and abroad focused on global managed services, consulting, and information technology (1993 to 2009) Other Public Company Directorships •Teradata Corporation (since 2020) |
Our Director Nominees
| | | 25 | | 2025 ANNUAL REPORT | 2026 PROXY STATEMENT | |
Director Compensation
Director Compensation
Cash and Stock Payments
| Annual Outside Director Compensation | Additional Annual Cash Compensation Supplemental Board Fee •Non-Executive Chairman of the Board—$200,000 | | | | Audit Committee •Chair—$35,000 •Member—$17,500 Nominating and Corporate Governance Committee •Chair—$30,000 •Member—$15,000 | Compensation Committee •Chair—$35,000 •Member—$17,500 Risk and Security Committee •Chair—$30,000 •Member—$15,000 |
2025 Compensation of Outside Directors
2025 Compensation of Outside Directors
Directors’ Compensation
| Name | Fees Earned or Paid In Cash | Stock Awards(1)(2)(3) | All Other Compensation | Total | | Continuing Directors: | | | | | | Quincy L. Allen | $160,625 | $221,508 | $— | $382,133 | | Martha Helena Béjar | $147,500 | $221,508 | $— | $369,008 | | Christopher Capossela | $135,000 | $221,508 | $— | $356,508 | | General Kevin P. Chilton | $147,500 | $221,508 | $— | $369,008 | | Michelle J. Goldberg | $99,375 | $221,508 | $— | $320,883 | | Diankha Linear | $140,000 | $221,508 | $— | $361,508 | | Stephen McMillan | $109,375 | $221,508 | $— | $330,883 | | Retiring Directors:(4) | | | | | | T. Michael Glenn(4)(5) | $317,500 | $221,508 | $3,984 | $542,992 | | Hal Stanley Jones | $150,000 | $221,508 | $— | $371,508 | | Former Directors: | | | | | | James Fowler(6) | $132,500 | $221,508 | $— | $354,008 | | Peter C. Brown(7) | $58,125 | $— | $— | $58,125 | | Steven T. “Terry” Clontz(7)(8) | $58,125 | $— | $10,000 | $68,125 | | Laurie A. Siegel(7)(8) | $62,500 | $— | $10,000 | $72,500 |
Non-Qualified Deferred Compensation
Non-Qualified Deferred Compensation NON-EMPLOYEE DIRECTORS DEFERRED COMPENSATION PLAN—In March 2019, the Board adopted a Non-Employee Director Deferred Compensation Plan for our outside directors. Under this plan, our non-employee directors may elect annually to defer all or any portion of their cash and equity compensation for the following calendar year. A participant may elect to receive his or her deferred amounts in a lump sum on either a fixed date of his or her choice or upon the occurrence of an event, such as his or her separation from service with the Company (generally, the date on which he or she is no longer a member of the Board). Alternatively, he or she may elect to receive such amounts in two to five equal annual installments on a fixed date or following an event. In any case, all amounts must be paid to the participant by the fifth anniversary of his or her separation from service. All cash amounts deferred under this plan by non-employee directors are allocated among deemed investments that follow the performance of a broad array of funds and are reflected in the market value of each participant’s account. Distributed amounts will include investment returns in respect of these hypothetical investments, whether positive or negative. If a non-employee director elects to defer all or a portion of the director’s annual equity award under this plan, as noted above, the portion of the award subject to the deferral election will be issued as RSUs instead of shares of restricted stock and will settle in shares on a fixed date elected by the director or following a specified event. Five of our current directors—Ms. Linear and Messrs. Allen, Chilton, Glenn, and Jones—have participated in this plan with respect to some or all of their recent awards.
2025 Executive Compensation Aligned with Business Performance
2025 Executive Compensation Aligned with Business Performance As discussed in greater detail in this CD&A, the Committee set challenging performance targets under our incentive programs to ensure that payouts track company performance and 93% of our CEO’s total target compensation is at risk. Our incentive programs (1) are aligned with our corporate strategy, (2) support our efforts to incentivize and retain our new leadership team, which is essential to our ability to execute on our transformation strategy, and (3) are paid out based on our performance, which has a direct impact on realizable pay outcomes. Over the course of several years, we navigated significant challenges and emerged with strategic clarity in 2025. We strengthened our financial position and restored market confidence in Lumen. For the first time since 2018, we exceeded our pre-established goals for our STI plan and our external guidance provided to shareholders, achieving a payout of 136.4% for 2025. Specifically, we: •achieved Adjusted EBITDA(1) results of $3,419 million and exceeded our target, comprising 50% of our STI plan; •achieved revenue results of $12,458 million and exceeded our target, comprising 25% of our STI plan; and •had strong execution against our five core priorities, comprising 25% of our STI plan. For the first time since 2012, we achieved a positive three-year total shareholder return (TSR), and for the first time since 2019, we achieved above threshold performance and a payout for the performance-based restricted stock (PBRS), which accounted for 60% of the respective LTI awards. Approximately 88.5% of the PBRS granted to our senior leadership team in 2023 vested based upon our actual performance over the three-year performance period ending December 31, 2025. Specifically, for the two-equally weighted metrics, we: •failed to attain threshold performance for our Cumulative Adjusted EBITDA target for a 0% payout; and •achieved a three-year TSR performance of 53.2% which was the 69th percentile relative to our peers for a 176.9% payout. (1)Adjusted EBITDA is a non-GAAP measure. For a reconciliation of Adjusted EBITDA to Revenue, the nearest GAAP measure, please see Appendix A.
2025 Short-Term Incentive Compensation
2025 Short-Term Incentive Compensation The chart below shows our overall level of achievement and company performance funding for the financial and qualitative metrics in our 2025 STI plan:
Dollars in Millions
| Performance Metrics | Threshold | Target(1) | Maximum | Actual vs. Target | Payout % | Weighting | Weighted Payout % | | Adjusted EBITDA | | | | 103.6% | 136.2% | | 68.1% | | Revenue | | | | 101.3% | 113.1% | | 28.3% | | Core Priorities Scorecard | | | | Average performance score of 4.2 out of 5 | 160% | | 40.0% | | | Weighted Payout Percentage of Company Performance Funding | | | | | | 136.4% |
2023 Long-Term Incentive Compensation
2023 Long-Term Incentive Compensation The chart below shows our overall level of achievement for the performance-based restricted share portion of our 2023 LTI program over the three-year performance period from 2023 to 2025:
Dollars in Millions
| Performance Metrics | Threshold | Target(1) | Maximum | Actual vs. Target | Payout % | Weighting | Weighted Payout % | | Cumulative Adjusted EBITDA(1) | | | | Below Threshold | 0.0% | | 0.0% | | Relative TSR(2) | | | | 69th Percentile | 176.9% | | 88.5% | | | Weighted Payout Percentage | | | | | | 88.5% |
Our Compensation Best Practices
| | What We Do | | What We Do Not Do | | Focus on performance-based compensation weighted heavily towards long-term incentive awards Maintain robust stock ownership guidelines applicable to our executive officers and outside directors Annually review our compensation programs to avoid encouraging excessive risk taking Conduct an annual succession planning process for our CEO Conduct an annual “say-on-pay” vote Discuss our executive compensation program during shareholder engagement Impose compensation forfeiture covenants (“clawbacks”) that are broader than, and in addition to, those mandated by law (such as, fraud and reputational harm) Review the composition of our peer groups at least annually Conduct independent and intensive performance reviews of our senior officers Cap the number of relative TSR performance-based shares that may vest if our own absolute TSR is negative Review realizable pay of our senior officers and total compensation “tally” sheets Require shareholders to approve any future severance agreements valued at more than 2.99 times the executive’s target cash compensation | | Maintain a supplemental executive retirement plan Permit our directors or any employee to hedge our stock, or our directors or senior officers to pledge our stock Permit the HRCC’s compensation consultant to provide other services to Lumen Pay, provide, or permit: (1)excessive perquisites, (2)excise tax “gross-up” payments, (3)single-trigger change of control equity acceleration benefits, or (4)dividend payments on unvested shares or RSUs | |
Aligning Performance Objectives with Strategy
| Key Objectives | | | | | | Aligned With Our Strategy Ensuring that performance-based metrics in our executive compensation programs reward performance over multiple time horizons and are aligned with our short- and long-term strategies, including individual contributions and Company performance, and our goal of creating long-term shareholder value while discouraging excessive risk taking | | Peer Group Alignment Structuring our compensation programs to be competitive and aligned to internal and external peers Utilizing an objective set of criteria to determine companies for our compensation peer group and TSR peer group | | | Challenging Goals Setting short-and long-term targets at challenging but reasonably achievable levels that reflect priorities and drive progress toward our long-term vision | | Pay for Performance Assessing effectiveness of prior year(s) incentive designs and performance against targets on a quarterly basis | | | Pay Mix Allocating a significant portion of our NEOs target compensation to performance-based components, with a balance between cash and equity and short- and long-term incentives Long-term target compensation opportunities outweighing short-term target opportunities. Annual objectives complementing sustainable long-term performance. | | Formulaic Maintaining STI and LTI programs with payouts that are mostly formulaic and all of which are determined based on actual performance against challenging financial and operational goals; with limited adjustments, positive or negative, as permitted and outlined in our Incentive Program Guidelines described herein, or as necessary to accomplish program objectives, with any remaining portion based on qualitative assessments of key performance indicators. | | | Shareholder Feedback Incorporating shareholder views, including results of our annual say-on-pay vote and our shareholder engagement initiatives | | Monitor Equity Usage Monitoring share expense, burn rate, and dilution against peer benchmarks |
Equity Grant Timing Practices
Equity Grant Timing Practices The HRCC generally approves annual equity awards under our LTI program during a meeting in the first quarter of each year. Consistent with recent years, in 2025 the awards were approved by the HRCC on February 19, 2025 following our release of earnings for 2025 on February 4, 2025, with the grant date for the LTI awards being March 1, 2025 and the award amounts based on the 15-day volume-weighted average closing price ending the day prior to the grant date. As described in this CD&A, the LTI program for our senior leadership team, including our NEOs, currently includes grants of time-based and performance-based restricted shares or RSUs. We have not granted stock options in several years. The HRCC does not take material nonpublic information into account when determining the timing and terms of equity awards, and the Company does not time the disclosure of material nonpublic information for the purpose of affecting the value of executive compensation.
Equity Grant Timing Practices
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Role of Compensation Consultants
Role of Compensation Consultants The HRCC engages an independent compensation consultant to assist in the design and review of our executive compensation programs, to determine whether the HRCC’s philosophy and practices are reasonable and compatible with prevailing practices and to provide guidance on specific compensation levels based on industry trends and practices. Compensia Inc. (Compensia) began serving as the HRCC’s independent compensation consultant in December 2024 and during 2025 attended all of the HRCC’s meetings. Compensia supported the HRCC and management by providing external market data and advising on industry trends and best practices. Compensia advised and participated in the design and development of our 2025 executive compensation programs, and also supported the HRCC in developing the compensation packages for the incoming and outgoing members of our senior leadership team during 2025 and early 2026. Compensia does not, and did not, provide any other services to the Company, and it neither has, nor has it had, a prior relationship with any of our NEOs. As required by SEC rules and NYSE listing standards, the HRCC assessed the independence for Compensia and concluded that its work has not raised any conflicts of interest.
Role of Peer Groups
Role of Peer Groups In the second half of each year, with assistance from its independent consultant, the HRCC determines the peer groups to be used by Lumen for purposes of assessing the compensation for our senior officers (Compensation Peer Group) and our total shareholder return performance (TSR Peer Group), which informs our decisions regarding our executive pay programs and compensation decisions for the following year.
Compensation Peer Group
Compensation Peer Group We believe that our Compensation Peer Group should reflect Lumen’s industry, organizational complexity, and market for management talent. However, we believe the list of direct peers is limited because few, if any, other communications companies are similarly sized and similarly configured in terms of their lines of business, markets, and customers. Further, as we continue to evolve into a technology-focused networking company, our employee base, peer group, and compensation programs are also evolving. Although in the past we had considerable success in attracting and retaining talent with fiscally prudent, market-based pay packages, we now compete with software and other technology-focused companies for a more limited pool of leadership talent. As a result, the individuals in that limited candidate pool, who frequently have unique talents and expertise, are able to command much higher levels of compensation than what we have paid historically, making executive recruitment and retention more challenging. To address these challenges, and described in greater detail below, the HRCC reviews and approves the list of companies that compose our Compensation Peer Group during a robust assessment process.
Compensation Peer Group
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Assessment Process
Assessment Process In August 2024 and 2025, the HRCC undertook the process below, with input from its then-independent consultant and Compensia, respectively. Our peer selection objective is to identify 15 to 20 companies that are reasonably comparable to Lumen in terms of industry and financial characteristics to provide both management and the Compensation Committee with pertinent compensation information to support compensation decision-making in the context of Lumen’s transformation. •Industry Assessment: Our primary assessment focuses on companies in similar and adjacent industries that have a growth strategy similar to Lumen as it transitions away from its traditional telecom business to an enterprise technology business. •Quantitative Assessment: Our secondary assessment further narrows our list of companies that are comparable in size based on 3 to 4 attributes: (i) revenue, (ii) market capitalization, (iii) enterprise value, and (iv) assets (for the August 2025 assessment process). However, given the volatility in our share price over the last few years (which is improving as we execute on our transformation), we placed greater weighting on revenue and assets, and less weighting on market capitalization and enterprise value for both our 2025 and 2026 Compensation Peer Groups. •Qualitative Assessment: Recognizing that there are few, if any, direct peers comparable in size, the HRCC conducts a qualitative assessment of companies for potential inclusion. This assessment is informed by (i) companies initially identified through the industry and quantitative assessments but eliminated for various reasons, (ii) disclosed peers of our peer group, (iii) companies that disclose Lumen as their peer, and (iv) peer groups selected by proxy advisors.
2025 Compensation Peer Group
2025 Compensation Peer Group Based on the results of the assessment process and input from HRCC’s then-independent consultant, the HRCC reviewed the 2024 Compensation Peer Group of 14 companies and, approved the removal of 3 companies (DISH Network, VMWare and Charter Communications, Inc.) and the addition of 3 companies (EchoStar Corporation, NetApp, Inc. and Frontier Communications), resulting in the 14 company 2025 Compensation Peer Group outlined below. With respect to the 2025 Compensation Peer Group, as of July 2024, Lumen was positioned at the 66th percentile for revenue, 36th percentile of enterprise value and 2nd percentile for market capitalization.
2026 Compensation Peer Group
2026 Compensation Peer Group Our transition towards an enterprise- and technology-focused business is further accelerated, in terms of size and focus, following the sale of our consumer fiber-to-the-home business to AT&T in early 2026. The HRCC, in consultation with its independent consultant, took this into consideration during our assessment process completed in August 2025 and made substantive changes to our peer group by removing 7 companies that no longer align with our go-forward size or business focus (Cisco Systems, EchoStar Corporation, Frontier Communications, Liberty Global, Oracle Corp, QUALCOMM Inc. and T-Mobile) and adding 8 companies that are similarly sized and complement our go-forward business focus (Corning, Equinix, Gen Digital, Keysight Technologies, Kyndryl Holdings, MongoDB, Okta and Zebra Technologies), resulting in the 15 company 2026 Compensation Peer Group outlined below. With respect to the 2026 Compensation Peer Group, as of August 2025, Lumen was positioned at the 47th percentile for revenue, 11th percentile of enterprise value, minimal percentile for market capitalization, and 50th percentile of assets.
2026 Compensation Peer Group
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2026 Compensation Peer Group
| GICS SUB-INDUSTRY | COMPENSATION PEER GROUP | | | | | | | | 2025 (n=14) | | 2026 (n=15) | | | Alternative Carriers | •Liberty Global Ltd. | | | | | | Cable and Satellite | •EchoStar Corp. | | | | | | Integrated Telecommunications Services | •Frontier Communications Parent, Inc. | | | | | | Semiconductors | •QUALCOMM Inc. | | | | | | Wireless Telecommunication Services | •T-Mobile US, Inc. | | | | | | Communications Equipment | •Cisco Systems, Inc. | | •Motorola Solutions, Inc. | | | | Systems Software | •Oracle Corp | | | | •Gen Digital, Inc. | | Technology Hardware, Storage | | | •Hewlett Packard Enterprise •NetApp •Seagate Technology plc •Western Digital Corp | | | | IT Consulting and Other Services | | | •Cognizant Technology Solutions Corp •DXC Technology Corp | | •Kyndryl Holdings, Inc. | | Data Center REITs | | | | | •Equinix | | Electronic Components | | | | | •Corning, Inc. | | Electronic Equipment and Instruments | | | | | •Keysight Technologies •Zebra Technologies Corp | | Internet Services and Infrastructure | | | | | •MongoDB, Inc. •Okta, Inc. |
TSR Benchmark and Peer Group
TSR Benchmark and Peer Group We separately maintain a TSR Benchmark for purposes of measuring our relative stock price performance, which impacts payouts under our LTI grants. As discussed above, our Compensation Peer Group is somewhat constrained by the number of companies based on revenue, enterprise value, and market capitalization. However, our TSR Benchmark is composed of a broader universe of companies we believe investors are considering when evaluating whether to invest in Lumen or our industry because profiles of investment opportunity and risk are likely to be more important to an investor than company size. As described in greater detail below, in November 2025, the HRCC completed an overall assessment of our LTI program and found that it remained generally aligned with compensation objectives, market norms, and investor expectations. However, the use of a custom peer group—particularly the TSR peer group from our 2025 LTI grants—was not aligned with the ongoing transformation of Lumen and the strategic direction of the Company. Taking that into consideration, the HRCC approved a change to the S&P 1500 Index as the benchmark for TSR awards beginning in 2026.
Assessment Process
Assessment Process In November 2024, in preparation for the 2025 LTI grant, the HRCC’s then-independent compensation consultant collaborated with management as part of an evaluation process to identify and assess relevant public companies to determine our TSR Peer Group, with the desired result of at least 15 to 20 peer companies, as follows: •Industry Assessment: Our primary assessment focuses on companies with similar and adjacent industries within our GICS industry and sub-industry and that have similar business and risk profiles as ours. •Quantitative Assessment: Our secondary assessment further narrows our list of companies based on a historical stock price correlation (including TSR and Beta and impacts of macroeconomic factors that would impact all companies similarly) between Lumen and a potential peer universe based on the industry assessment results. •Qualitative Assessment: Recognizing that there are few, if any, direct peers that are going through as significant transformation as Lumen is, the HRCC conducts a qualitative assessment of companies for potential inclusion. This assessment is informed by (i) disclosed peers of our peer group, (ii) companies that disclose Lumen as their peer, and (iii) peer groups selected by proxy advisors. In November 2025, in preparation for the 2026 LTI grant and in the context of our ongoing digital transformation and increased grounding in technology sector comparables, the HRCC’s independent compensation consultant collaborated with management to complete a robust evaluation of our overall LTI program design, including relative TSR weighting, key design features, and peer group data for measurement of TSR performance.
2025 TSR Peer Group
2025 TSR Peer Group Based on the results of the assessment process and input from HRCC’s then-independent consultant, the HRCC reviewed the 2024 TSR Peer Group of 14 companies and approved its use without change for our 2025 TSR Peer Group.
2026 TSR Benchmark
2026 TSR Benchmark Based on the results of the robust evaluation, the HRCC determined our LTI program design is aligned with the majority of our peers, specifically, (i) relative TSR as a weighted metric in addition to one other metric, (ii) 3-year cliff vesting, and (iii) performance and payout range levels. However, from a market comparison approach, our LTI program is not aligned with our peers. Only 3 peers measure TSR performance against a custom peer group; whereas, the majority of our peers measure TSR performance against a broad industry index. Following a robust discussion with the HRCC’s independent consultant and management, the HRCC approved to change our TSR benchmark from a custom peer group to the S&P 1500 Index for our 2026 LTI grants.
2026 TSR Benchmark
| 2025 TSR Peer Group (n=14) | | | •AT&T, Inc. •Cable One, Inc. •Charter Communications, Inc. •CISCO Systems Inc. •Cogent Communications Holdings, Inc. •Comcast Corp •Consolidated Communications | •EchoStar Corp •Frontier Communications •Liberty Global, PLC •Motorola Solutions, Inc. •Telephone & Data Systems, Inc. •Verizon Communications Inc. •Viasat, Inc. | | 2026 TSR Benchmark | | | •S&P 1500 Index | |
Section Five—Compensation Design, Awards, and Payouts for 2025
Section Five—Compensation Design, Awards, and Payouts for 2025
Our Pay Elements
| | CEO | Element and Description | 2025 Design Changes | 2025 Performance Objectives Aligned with Strategy | | | Base Salary | Base Salary As with most companies, base salary is annual fixed cash compensation that provides competitively set and stable income to our executives. | | | | | Short-Term Incentive Bonus | STI Program STI bonus is annual variable cash compensation based on the achievement of annual performance measures. Alignment to Compensation Philosophy STI provides competitive short-term incentive opportunities for our executives to earn annual bonuses, typically paid in cash, based on performance objectives that, if attained, can reasonably be expected to (1) promote our business and strategic objectives and (2) correspond to those paid to similarly situated and comparably-skilled executives at peer companies. The HRCC retains discretionary authority over determining any and all amounts to be paid under the STI plan. | Reduced the weighting for our revenue metric by 10% and replaced our customer experience metric with core priorities (increasing its weighting to 25%) to align with our strategy and transformation, described in further detail in this section under “—2025 Short-Term Incentive Program.” | Adjusted EBITDA measures the operational performance and profitability of our businesses and is commonly used by industry investors to evaluate our total enterprise value. (50%) Revenue generation is critical to our goal of transitioning to growth. (25%) Core Priorities are comprised of goals and objectives critical to our transformation. (25%) A positive or negative adjustment for individual performance based on “line of sight” for their specific areas of responsibility and individual objectives. Any positive adjustments for an NEO’s individual performance are capped at 20% of the STI amount otherwise payable based on Company performance. (Individual Performance modifier) | | | Long-Term Incentive Compensation | LTI Program LTI provides variable compensation historically awarded annually solely in equity that vests over three years from the date of grant, with at least 60% of the award for our senior leaders based on the level of achievement of pre-established performance measures for a three-year period. Alignment to Compensation Philosophy LTI fosters a culture of ownership, aligns the long-term interests of our executives with our shareholders, and helps to retain executives through stock price growth and the creation of long-term value. Our performance-based awards are dependent upon our performance measured against key business objectives over a three-year period, further strengthening the alignment between executive pay, Company performance and shareholder value creation. The amount of LTI compensation that is ultimately realized depends on how successfully we execute our strategic goals and our overall stock performance. | Returned to 100% equity for our 2025 annual LTI awards | Time-Vested Restricted Shares (TBRS-40%) are intended to align our executives and shareholders interests by focusing on the long-term value of our Common Shares. Performance-Based Restricted Shares (PBRS-60%) are comprised of two-equally weighted metrics: (1) Cumulative Free Cash Flow measures our ability reinvest in the business, strengthen the balance sheet, and return capital to shareholders over a three-year period. (30%) (2) Relative Total Shareholder Return or rTSR rewards achievement of stock price growth relative to an external benchmark over a three-year period and further strengthens the alignment of executive and shareholder interests. (30%) |
Target Compensation
For more information on how we determined specific pay levels in 2025, see further discussion in ”—Base Salary”, “—2025 Short-Term Incentive Program,” and “—2025 Long-Term Incentive Compensation” below in this section and in “Section Four—HRCC Engagement and Compensation Governance—Role of Peer Companies—Compensation Peer Group.” Each of these elements is discussed in greater detail below. For information on the target pay levels of our Former NEOs, see discussion in “—Compensation Arrangements Related to Leadership Transition.”
Base Salary
(1)The beginning base salary for Messes. Johnson and Haynes-Gaspar and Messrs. Stansbury and Ward are as of January 1, 2025. The beginning base salary for Mr. Hacker are as of his hire date as described further below. For more information on how we determined specific pay levels in 2025, see further discussion under the heading “Section Four—HRCC Engagement and Compensation Governance—Role of Peer Companies—Compensation Peer Group.”
2025 Short-Term Incentive Program
2025 Short-Term Incentive Program As described below, the 2025 STI program incorporates three components in determining the calculated STI bonus amount (payout) for our NEOs: (1) target bonus opportunity; (2) company performance funding; and (3) individual performance modifier. The 2025 STI program applies not only to our senior leadership team, which includes the NEOs, but also to approximately 17,000 employees of our Company.
2025 Short-Term Incentive Program
| TARGET BONUS OPPORTUNITY | × | COMPANY PERFORMANCE FUNDING | × | INDIVIDUAL PERFORMANCE MODIFIER | = | STI Bonus Amount | | (Base Salary x STI Target Bonus %) | | (0% to 200%) | | (0% to 120% for NEOs) | | (capped at 2x target opportunity) |
2025 Short-Term Incentive Program
| Notwithstanding Company performance, the bonus otherwise payable to any NEO, including any of our employees, may be eliminated based on his or her individual performance. |
2025 Short-Term Incentive Program
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2025 STI Target Bonus Opportunity
2025 STI Target Bonus Opportunity As noted above, 2025 STI target bonus opportunities were equal to the product of an employee’s (1) earned base salary for 2025 and (2) his or her STI target bonus percentage, with any mid-year adjustments resulting in a blended percentage based on the target bonus percentages before and after the adjustment. The 2025 STI target opportunities for our NEOs are set forth in the table below. As reflected in that table, following the annual review and consideration of competitive range for similar positions at the companies in our compensation peer group and/or market survey data at its first quarter meeting, the HRCC increased the STI target bonus percentage for Mr. Stansbury to 150% and left the STI target opportunities unchanged for the other NEOs then employed.
2025 STI Target Bonus Opportunity
| NEO | Beginning STI Target Percentage(1) | | STI Target Percentage as of December 31, 2025 | | % Increase | | | Current EOs | | | | | | | | Ms. Johnson(2) | | 220% | | 220% | | — | | Mr. Stansbury | | 125% | | 150% | | +25% | | Mr. Hacker | | 100% | | 100% | | — | | Former EOs | | | | | | | | Mr. Ward | | 100% | | 100% | | — | | Ms. Haynes-Gaspar | | 100% | | 100% | | — |
2025 STI Target Bonus Opportunity
(1)The beginning STI target opportunities for Messes. Johnson and Haynes-Gaspar and Messrs. Stansbury and Ward reflect their respective targets for 2024. The beginning STI target opportunities for Mr. Hacker is as of his hire date, as described further below. (2)Effective March 1, 2025, the HRCC increased the STI target opportunity for Mr. Stansbury to 150% in recognition of his performance as CFO and to align with his external peers. For more information on how we determined specific pay levels in 2025, see further discussion under the heading “Section Four—HRCC Engagement and Compensation Governance—Role of Peer Companies—Compensation Peer Group.”
2025 STI Metrics and Results
2025 STI Metrics and Results For 2025, the HRCC, after consultation with our CEO and its independent compensation consultant, left unchanged the weighting for our Adjusted EBITDA metric, reduced the weighting of our revenue metric, and introduced a new core priorities scorecard, replacing customer experience as a metric, to better align with our strategy and transformation objectives.
Calculation of Achieved Payout
Calculation of Achieved Payout The achieved payout percentage is calculated for each financial metric under our STI program, based on a corresponding payout scale approved by the HRCC in the first quarter of the plan year. If the threshold performance level with respect to any particular financial metric is not attained, the bonus payable to the participating officer with respect to that portion of his or her targeted bonus opportunity will be calculated as zero. If threshold performance is met, but below target level performance, on any particular metric, each participating officer will earn a reduced portion of his or her target bonus amount for that portion of the award. If the maximum performance level with respect to any particular metric is met or exceeded, each participating officer will earn up to a maximum of 200% of his or her target bonus amount for that portion of the award. Measurement of the attainment of any particular metric is interpolated if actual performance is between (1) the “threshold” and the “target” performance levels or (2) the “target” and the “maximum” performance levels.
Calculation of Achieved Payout
| | Metric: Adjusted EBITDA (weighted 50%) |
Calculation of Achieved Payout
Adjusted EBITDA remained our most heavily-weighted STI financial performance objective, at 50%, for 2025. We believe this metric is aligned with our shareholders’ best interests and our corporate strategy of pursuing profitable growth. As described elsewhere herein, in light of the systemic revenue decline for our higher-margin legacy services, we continuously need to adjust our cost structure—requiring a disciplined focus on Adjusted EBITDA and margins. We achieved Adjusted EBITDA results of $3,419 million, which exceeded of our 2025 Target goal, achieving 136.2% payout.
Calculation of Achieved Payout
| | Target Amount of Adjusted EBITDA(1) | Payout as a % of Target Award | Results(2) | | | Maximum | ≥ $3,630 million | 200% | $3,419 million | ACHIEVED PAYOUT OF 136.2% | | Target | $3,300 million | 100% | | | | Threshold | $2,970 million | 50% | | | | Below Threshold | < $2,970 million | 0% | | |
Calculation of Achieved Payout
(1)The HRCC approved the Adjusted EBITDA targets in February 2025, consistent with our external guidance of $3.2 to $3.4 billion. (2)For additional information on Lumen and our recent performance, see “Section One—Executive Summary—Business Highlights” in this CD&A and “Item 7. Management’s Discussion and Analysis of the Financial Condition and Results of Operations” included in Appendix B.
Calculation of Achieved Payout
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Calculation of Achieved Payout
| | Metric: Revenue (Weighted 25%) |
Calculation of Achieved Payout
The generation of revenue is critical to our goal of increasing revenue from our growth products in amounts sufficient to offset our continuing and systemic legacy revenue losses. Revenue is weighted at 25% for our 2025 STI plan (reduced from 35% weighting in our 2024 STI plan). The HRCC believes our senior officers were appropriately incentivized to achieve profitable revenue growth, since the majority of our 2025 STI is based on Adjusted EBITDA. We achieved Revenue results of $12,458 million, which exceeded of our 2025 Target goal, achieving 113.1% payout.
Calculation of Achieved Payout
| | Target Amount of Revenue(1) | Payout as a % of Target Award | Results(2) | | | Maximum | ≥ $13,526 million | 200% | $12,458 million | ACHIEVED PAYOUT OF 113.1% | | Target | $12,296 million | 100% | | | | Threshold | $11,066 million | 50% | | | | Below Threshold | < $11,066 million | 0% | | |
Calculation of Achieved Payout
(1)The HRCC approved the Revenue targets in February 2025, consistent with our annual budget. (2)For additional information on Lumen and our recent performance, see “Section One—Executive Summary—Business Highlights” in this CD&A and “Item 7. Management’s Discussion and Analysis of the Financial Condition and Results of Operations” included in Appendix B.
Qualitative Performance Assessment
| Score | Payout % | Performance Level Attainment | | 5 | 200% | Ahead of 2025 targets and significant potential to further exceed transformation goal | | 4 | 150% | Ahead of 2025 targets and no concerns about ability to reach transformation goal | | 3 | 100% | On track for 2025 targets | | 2 | 50% | Off-track for 2025 targets, but a plan to recover | | 1 | 0% | Off-track for 2025 targets, no plan to recover missed impact |
2) Individual Performance Modifier
2) Individual Performance Modifier As contemplated by the STI plan and our Incentive Program Guidelines, the HRCC reserves the right to increase or decrease the STI bonus payout level based on its qualitative assessments for each senior officer’s performance against certain specific objectives and benchmarks, as well as overall Company and individual performance during the year. The HRCC may eliminate the STI bonus otherwise payable to any of our executives based on his or her individual performance, any upward adjustment for an NEO based on his or her individual performance is capped at 20% (i.e., 120% of Company performance funding), and in no event can an executive receive more than twice his or her target bonus opportunity. Given the importance of our NEOs in making and putting into operation decisions that set the Company up for future success, for 2025, the HRCC assessed each NEO’s individual performance against the following four key objectives: •Financial—relevant financial objectives based on the individual’s role; •Strategic—goals vary based on each individual and cover areas such as customer obsession, innovation, and investing for growth; •Operations—goals vary based on each individual and cover areas such as building a reliable execution engine and radically simplifying our Company; and •Organization—goals vary based on each individual and cover areas such as culture and talent retention and development. Given each NEO’s performance and leadership accomplishments and the resulting above target performance against our 2025 financial targets and core priority objectives, the HRCC approved the following Individual Performance Modifiers for each of our NEOs.
2025 STI Payouts
2025 STI Payouts The HRCC approved each NEO’s STI bonus as summarized in the table below.
2025 STI Bonus Amounts
2025 STI Bonus Amounts
2025 STI Bonus Amounts
| NEO | STI Target Bonus Opportunity(1) | Company Performance Funding(2) | Individual Performance Modifier(3) | | Calculated STI Bonus Amount | | Current EOs | | | | | | | Ms. Johnson | $2,979,891X | 136.4%X | 120% | = | $4,877,486 | | Mr. Stansbury | $1,240,660X | 136.4%X | 115% | = | $1,946,099 | | Mr. Hacker | $486,167X | 136.4%X | 105% | = | $696,289 | | Former EOs | | | | | | | Mr. Ward | $770,960X | 136.4%X | 100% | = | $1,051,589 | | Ms. Haynes-Gaspar | $645,963X | 136.4%X | 90% | = | $792,984 |
2025 STI Bonus Amounts
(1)Reflects the product of the salary the executive earned during 2025 (and, as such, reflect the fact that Mr. Hacker was employed for less than the full year) and his or her STI target bonus percentage for 2025 (adjusted, for Mr. Stansbury, to reflect his mid-year increase). See “—Target Compensation” above. (2)Calculated and adjusted as discussed in “—Company Performance” above. (3)See “—Individual Performance Modifier” above.
2025 Long-Term Incentive Compensation
2025 Long-Term Incentive Compensation Each year the HRCC approves long-term incentive compensation awards for our senior leadership team, including the NEOs, and oversees the governance for LTI awards, approved by our CEO, for the approximately 1,160 employees in the upper management of our Company that are eligible for annual LTI awards.
2025 LTI Program
2025 LTI Program The HRCC believes the structure of our long-term incentive compensation reinforces our performance culture, encourages value creation for our shareholders, and promotes retention through multi-year vesting.
2025 LTI Program Metrics and Weightings
2025 LTI Program Metrics and Weightings
2025 LTI Program Metrics and Weightings
| | ■ | Time-Based Restricted Shares (TBRS) Maintained 40% time-based restricted stock that rewards the creation of incremental shareholder value over a long-term period and serves as a retention lever, through graded vesting over three years. | | | | ■ | Performance-Based Restricted Shares (PBRS) | | | | | Maintained 60% performance-based portion that returned to equity from performance-based long-term cash,(1) rewarding performance achievement (between 0-200%) based on two equally-weighted metrics, described in detail below, measured over a cumulative three-year period. | | | | | ■ | Relative TSR | | | | ■ | Cumulative Free Cash Flow |
2025 LTI Program Metrics and Weightings
(1)As disclosed in our 2025 proxy statement, the performance-based portion (weighted 60%) of our 2024 annual LTI awards was granted in cash due to our low stock price and limited share pool at the time. Following the end of the three-year performance period from January 1, 2025 to December 31, 2027, the number of shares vesting under the PBRS granted in 2025 will be calculated by: (1) determining achievement of Lumen’s TSR performance relative to our TSR Peer Group; and (2) determining achievement of the three-year Cumulative Free Cash Flow target, each of which is described further below. Each metric is calculated independently with the ultimate payout ranging between zero to 200% of the target shares granted. Any amount earned under the PBRS for our current NEOs generally will vest in full on March 1, 2028, subject to the holder’s continued employment through that date. For more information see “Section Two—Compensation Philosophy and Principles.”
Relative TSR
Relative TSR The HRCC believes a relative metric is an important design element for our LTI program. Relative TSR is a measure of performance against a relevant external benchmark. In 2025, that benchmark was a custom peer group. Beginning in 2026, that benchmark will be a broad market index, aligning with our transformation and go-forward business strategy. Our Relative TSR performance shares are measured on our percentile rank versus the other 14 companies in our TSR peer group over the three-year period, which could result in a payout of zero to 200% of this component of the target award. However, if Lumen’s TSR is negative over the three-year period, the payout cannot exceed target—regardless of our TSR performance relative to our peers. We believe this cap better aligns the LTI payout with the interests of our shareholders. With the aid of its compensation consultant, the HRCC set a TSR peer group that is focused principally on broader universe of companies that we believe investors are considering when they decide whether to invest in us or our industry. As a result, our TSR peer group listed below is comprised of telecommunications, cable, and other communications companies that are generally comparable to us in terms of size, markets, and operations. For more information regarding the determination of our TSR peer group, see “Section Four—HRCC Engagement and Compensation Governance—Role of Peer Companies—TSR Peer Group” below.
Relative TSR
| TSR Peer Group | | | | AT&T, Inc. | Comcast Corporation | Motorola Solutions, Inc. | | Cable One, Inc. | Consolidated Communications | Telephone & Data Systems Inc. | | Charter Communications | EchoStar Corporation | Verizon Communications Inc. | | CISCO Systems Inc. | Frontier Communications Parent, Inc. | Viasat, Inc. | | Cogent Communications Holdings, Inc. | Liberty Global plc | |
Relative TSR
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Relative TSR
The table below outlines the targets and payout curves for the relative TSR, one of our equally-weighted metrics, of our 2025 PBRS.
Relative TSR
| Performance Level Attainment | Relative TSR(1) (50% Weighting) | | | | Target | Payout %(2) | | Maximum | ≥ 75th Percentile | 200% | | Target | 50th Percentile | 100% | | Threshold | 25th Percentile | 50% | | Below Threshold | < 25th Percentile | 0% |
Relative TSR
(1)2025-2027 Relative TSR performance is measured against the 14-company TSR peer group described above. (2)Payouts are interpolated between defined performance levels.
Cumulative Free Cash Flow
| Performance Level Attainment | Cumulative Free Cash Flow(1) (50% Weighting) | | | | Target Amount | Payout %(3) | | Maximum | Maximum Amount | 200% | | Target | Target Amount(2) | 100% | | Threshold | Threshold Amount | 50% | | Below Threshold | >Threshold Amount | 0% |
LTI Target Opportunity
LTI Target Opportunity The HRCC believes long-term incentive compensation is the most critical pay element for our CEO and for our other members of the senior leadership team, because it creates alignment with shareholders and promotes achievement of long-term financial and our strategic objectives. The HRCC takes a number of steps in connection with setting long-term incentive target opportunities for each of our senior officers, including the review of: (1) compensation tally sheets and compensation peer group data; (2) such officer’s pay and performance relative to other senior officers; (3) the scope and complexity of the officer’s role; (4) the officer’s experience and proficiency and the criticality of the skill set needed to execute the officer’s role; and (5) when the officer last received an increase to their LTI target opportunity. As a result of the review and consideration of the above factors, in February 2025, the HRCC increased our CEO’s LTI target opportunity to better align with the market and to reflect her continued experience and in her role, courageous and determined strategy, and urgency for excellence. The increases in the LTI target opportunities for Messrs. Stansbury and Ward were intended to support retention and recognize the critical roles each executive plays in the Company’s transformation, while also improving alignment with applicable market practices. In the case of Mr. Ward, his increase also reflects his expanded scope of responsibilities in late 2024 to include Product, in addition to his Technology responsibilities. The LTI target opportunity for Ms. Haynes-Gaspar was left unchanged. The LTI target opportunity for Mr. Hacker was established upon his hiring through arms-length negotiations taking into account his qualifications, experience, comparable market compensation for his position, and internal equity. See “—Compensation Arrangements Related to Leadership Transitions.”
LTI Target Opportunity
| NEO | 2024 Annual LTI Target Opportunity | 2025 Annual LTI Target Opportunity | % Increase | | | Current EOs | | | | | | Ms. Johnson | $14,250,000 | $15,650,000 | | 10% | | Mr. Stansbury | $5,500,000 | $6,000,000 | | 9% | | Mr. Hacker(1) | — | $2,700,000 | | — | | Former EOs | | | | | | Ms. Haynes-Gaspar | $2,350,000 | $2,350,000 | | — | | Mr. Ward | $2,500,000 | $3,450,000 | | 38% |
LTI Target Opportunity
(1)In connection with his expanded responsibilities in late 2025, to include our Public Sector business in addition to his General Counsel and Public Policy functions, the HRCC approved to increase Mr. Hacker’s LTI target opportunity to $3,300,000 for his 2026 annual LTI award.
2025 Annual LTI Grants
2025 Annual LTI Grants The HRCC granted annual LTI awards to our then-current NEOs, effective March 1, 2025, at the 2025 annual LTI target opportunities outlined above, and a pro-rated annual LTI award for Mr. Hacker effective upon his hire date of May 12, 2025. The actual value realized may differ significantly (up or down) from the target grant value due to Company stock price performance over the life of the awards and the extent to which performance goals are met in the case of performance-based restricted shares.
2025 Annual LTI Grants
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2025 Annual LTI Grants
2025 Annual LTI Grants
2025 Annual LTI Grants
| | Time-Vested Restricted Shares | | Performance-Based Restricted Stock | | Total Target Grant Value(5) | | NEO | No. of Shares(1)(3) | Target Grant Value(4) | No. of Shares(2)(3) | Target Grant Value(4) | | | Current EOs | | | | | | | Ms. Johnson | 1,332,425 | $6,260,000 | 1,998,638 | $9,390,000 | $15,650,000 | | Mr. Stansbury(6) | 510,834 | $2,400,000 | 766,250 | $3,600,000 | 6,000,000 | | Mr. Hacker | 215,071 | $800,000 | 322,606 | $1,200,000 | 2,000,000 | | Former EOs | | | | | | | Ms. Haynes-Gaspar | 200,077 | $940,000 | 300,114 | $1,410,000 | 2,350,000 | | Mr. Ward(7) | 293,730 | $1,380,000 | 440,594 | $2,070,000 | 3,450,000 |
2025 Annual LTI Grants
(1)Represents the number of time-vested restricted shares (representing 40% of total target grant value) granted on March 1, 2025 to each of Messes. Johnson and Haynes-Gaspar and Messrs. Stansbury, and Ward, and granted on May 12, 2025 to Mr. Hacker. The restricted shares vest in three equal installments on each of the first three anniversaries of the grant date, subject to the executive’s continued employment through the relevant vesting date. As discussed under “—Compensation Arrangements Related to Leadership Transition,” the awards to Mr. Ward was canceled upon his termination. (2)Represents the target number of performance-based restricted shares (representing 60% of total target grant value) granted on March 1, 2025 to each of Messes. Johnson and Haynes-Gaspar and Messrs. Stansbury and Ward, and granted on May 12, 2025 to Mr. Hacker. Each grant vests in full on the third anniversary of the grant date, if at all, based on the level of performance achieved against the underlying metrics and subject to the executive’s continued employment through the relevant vesting date. As discussed under “2025 LTI Program Metrics and Weightings” above, the actual number of shares that vest in the future may be lower or higher (between 0-200%), depending on the level of performance achieved. (3)Any dividends on the shares of restricted stock would not be paid on unvested awards but would accrue and be paid or forfeited in tandem with the vesting or cancellation, as the case may be, of the related shares. (4)For purposes of these grants, we determined both the number of time-vested and target performance-based restricted shares granted to each NEO by dividing the approved target amount by the volume-weighted average closing price of our Common Shares over the 15-trading-day period ending one trading day prior to the grant date. However, as noted previously, for purposes of reporting these awards in the "Compensation Tables—Summary Compensation Table," our shares of time-vested restricted stock are valued based on the closing price of our Common Shares on the date of grant, and our shares of performance-based restricted stock are valued as of the grant date based on probable outcomes, as required by applicable accounting and SEC disclosure rules. For 2025, this resulted in the values reported in the "Compensation Tables—Summary Compensation Table" being 19-32% higher than those shown above for most of our NEOs. See footnote 2 to the "Compensation Tables—Summary Compensation Table" for more information. (5)The total target grant value is commensurate with the LTI target opportunities for Messes. Johnson and Haynes-Gaspar and Messrs. Stansbury and Ward, as of the grant date of March 1, 2025 and, for Mr. Hacker, the total target grant value is pro-rated to reflect his partial year of service and represents approximately 74% of his initial LTI target opportunity. (6)Excludes the special equity grant awarded to Mr. Stansbury in March 2025, which is described under “2025 Special Equity Grant” below. (7)Upon Mr. Ward’s resignation and termination of his employment on January 23, 2026, and in accordance with the terms of the awards, his outstanding time-vested and target performance-based restricted shares were forfeited in their entirety.
2025 Annual LTI Grants
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2025 Special Equity Grant
2025 Special Equity Grant The HRCC, in consultation with our CEO, other members of the Board and our independent compensation consultant, approved a special equity award for Mr. Stansbury having a target grant value of $3,000,000, effective March 1, 2025, with three-year cliff vesting and subject to continued employment thereon. The HRCC approved this grant in recognition of Mr. Stansbury’s demonstrated performance and leadership and to further align his interests with those of our shareholders and to retain and incentivize him during this critical transformation period. The HRCC considered his oversight of the Company’s financial integrity and focus on strengthening our balance sheet and capital structure, his effective stewardship of investor and other key stakeholder relationships, and his material contributions to advancing and executing on our transformation and long‑term strategy—to become the trusted network for AI and transition to growth by the end of 2027.
2025 Special Equity Grant
2025 Special Equity Grant
2025 Special Equity Grant
| | Time-Vested Restricted Shares | | | NEO | No. of Shares(1)(2) | Target Grant Value(3) | | Mr. Stansbury | 638,542 | $3,000,000 |
2025 Special Equity Grant
(1)Represents the number of time-based restricted shares granted to Mr. Stansbury on March 1, 2025 and vests in full on the third anniversary of the grant date, subject to his continued employment through the vesting date. (2)Any dividends on the shares of restricted stock would not be paid on unvested awards but would accrue and be paid or forfeited in tandem with the vesting or cancellation, as the case may be, of the related shares. (3)For purposes of this grant, we determined the number of time-vested restricted shares granted to Mr. Stansbury by dividing the approved total grant value by the volume-weighted average closing price of a share of our Common Shares over the 15-trading-day period ending one trading day prior to the grant date,. However, as noted previously, for purposes of reporting these awards in the "Compensation Tables—Summary Compensation Table," our shares of time-vested restricted stock are valued based on the closing price of our Common Shares on the date of grant. See footnote 2 to the "Compensation Tables—Summary Compensation Table" for more information.
2025 Special Equity Grant
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Outstanding Performance-Based LTI Awards
Outstanding Performance-Based LTI Awards As of December 31, 2025 and as illustrated in the table below, we had three outstanding tranches of LTI awards, granted in 2023, 2024, and 2025, with overlapping three-year performance periods and performances metrics of Relative TSR, Cumulative Adjusted EBITDA, or Cumulative Free Cash Flow.
Outstanding Performance-Based LTI Awards
| Grant Year | Performance Period | Metric Weighting | 2023(1) | 2024 | 2025 | 2026 | 2027 | | 2023(2) | 2023-2025 | 50% | 3-YR Cumulative Adjusted EBITDA(3) | | | | | | | | | | | | | | | | | 50% | 3-YR Relative TSR | | | | | | | | | | | | | | | 2024 | 2024-2026 | 50% | | 3-YR Cumulative Free Cash Flow | | | | | | | 50% | | 3-YR Relative TSR | | | | | | | | | | | | | | 2025 | 2025-2027 | 50% | | | 3-YR Cumulative Free Cash Flow | | | | | | 50% | | | 3-YR Relative TSR | | | | | | | | | | | |
Outstanding Performance-Based LTI Awards
(1)The sale our Content Delivery Network (“CDN”) and Europe, Middle East and Africa (“EMEA”) businesses, which were completed in October and November 2023, respectively, occurred during the second and first year of the three-year performance period for our outstanding 2022 and 2023 LTI awards, respectively. For more information on the sale of our EMEA business, see Note 2—Divestitures of the Latin American, ILEC and EMEA Business— to the consolidated financial statements included in Item 8 of Part II of our Annual Report on Form 10‑K for the year ended December 31, 2024. (2)For more information on (i) our 2023 PBRS targets, including adjustments to the three-year Cumulative Adjusted EBITDA target, as permitted under our Incentive Program Guidelines, see “—LTI Linkage to Performance—Payouts Under 2023 PBRS Awards” below. (3)For 2023 PBRS, when the three-year Cumulative Adjusted EBITDA target was set in the first quarter of 2023, the Company assumed its then-pending divestiture of its EMEA business would close on January 1, 2024. The sale our EMEA business was actually completed in November 2023. The HRCC approved adjustments to the targets against which the 2023 LTI awards would be measured to prevent holders of PBRS from receiving an unintended penalty from the accelerated closing.
LTI Linkage to Performance—Payouts Under 2023 PBRS Awards
LTI Linkage to Performance—Payouts Under 2023 PBRS Awards In early 2023, the HRCC approved 2023 PBRS awards, comprising 60% of total grant value for 2023 annual LTI awards(1), to the then-members of our senior leadership team, including Messes. Johnson and Haynes-Gaspar and Mr. Stansbury. Mr. Hacker and Mr. Ward, who joined the Company in May 2025 and February 2024, respectively, and did not participate in the 2023 LTI program. The 2023 PBRS awards were based on two equally-weighted metrics (Cumulative Adjusted EBITDA and Relative TSR) over a three-year period ending December 31, 2025. As described in greater detail below, we achieved below threshold performance against the target for Cumulative Adjusted EBITDA and 177% payout for our TSR peer group, resulting in a weighted performance payout of 88.5% and forfeiture of the remaining 2023 PBRS awards. (1)For further discussion on our 2023 LTI Awards, see our 2024 proxy statement.
LTI Linkage to Performance—Payouts Under 2023 PBRS Awards
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2023 LTI Program Outcomes
2023 LTI Program Outcomes
2023 LTI Program Outcomes
| | 40% Time-Vested Restricted Stock | 60% Performance- Based Restricted Stock | | | Grant Price | $3.90 | $3.90 | 143% OF LTI TARGET VALUE REALIZED UPON VESTING | | Year 1 Vesting Date Price | 1.62 | — | | | Year 2 Vesting Date Price | 4.72 | — | | | Year 3 Vesting Date Price | 7.11 | 7.11 | | | Weighted performance payout for 2023 PBRS | — | 88.5% | | | | 115% | 161% | |
Cumulative Adjusted EBITDA Metric (weighted 50%)
| | Target Amount of Adjusted EBITDA(1) | Payout as a % of Target Award | Results: | | | Maximum | ≥ $14,116 million | 200% | $11.989 million(2) (below threshold) | ACHIEVED PAYOUT OF 0% | | Target(2) | $13,584 million | 100% | | | | Threshold | $13,052 million | 50% | | | | Below Threshold | < $13,052 million | 0% | | |
Relative TSR Metric (Weighted 50%)
Relative TSR Metric (Weighted 50%) We achieved TSR of 53.2% for the three-year period ending December 31, 2025, which was at the 62nd percentile for our 2023 TSR peer group.
Relative TSR Metric (Weighted 50%)
| | Relative TSR Performance | Payout as a % of Target Award | Results(1) | | | Maximum | ≥ 75th Percentile | 200% | TSR of 53.2% (69th Percentile) | ACHIEVED PAYOUT OF 176.9% | | Target | 50th Percentile | 100% | | | | Threshold | 25th Percentile | 50% | | | | Below Threshold | < 25th Percentile | 0% | | |
Relative TSR Metric (Weighted 50%)
(1)If Lumen’s TSR is negative over the three-year period, the payout cannot exceed target regardless of our TSR performance relative to our peers.
Relative TSR Metric (Weighted 50%)
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Goal Setting Process and Incentive Program Guidelines
Goal Setting Process and Incentive Program Guidelines
Incentive Program Guidelines
Incentive Program Guidelines While the performance objectives and targets under our incentive programs are designed to measure objective performance over a specified period of time, the HRCC may make certain adjustments to our performance calculations. To provide structure and promote fairness in addressing such situations, the HRCC has adopted Guidelines on Administering Incentive Plans (our “Incentive Program Guidelines”) to aid the HRCC’s goal of reaching equitable STI and LTI payout decisions that align performance with our targets and, ultimately, our corporate strategy. As described in the table below, our Incentive Program Guidelines provide three types of potential adjustments to our STI or LTI metrics that can affect the overall payout. Mandatory Adjustments. The first type of adjustment occurs after completion of each performance period in conjunction with the HRCC’s review of the financial results and assumptions, and requires the HRCC to make adjustments to eliminate the effects of acquisitions or divestitures and certain other unanticipated events specified in our Incentive Program Guidelines that correspond closely, but not exactly, with the “Non-GAAP Special Items” financial trending schedule included in our earnings release for the corresponding performance period.
Incentive Program Guidelines
| | | 109 | | 2025 ANNUAL REPORT | 2026 PROXY STATEMENT | |
Incentive Program Guidelines
These adjustments are necessary to measure our performance results in the same manner the targets were set and may require the HRCC to adjust (1) our STI targets or performance results and (2) our three-year LTI targets established under the performance-based portion of our annual LTI grants. Discretionary Adjustments. The second type of adjustment provides the HRCC with discretionary authority to adjust STI and LTI performance results based on any other “extraordinary, unusual, or non-recurring transactions or items” to prevent award payouts from being unfairly impacted by such items. The adjustments may be positive or negative and will only be made if the events were not known on the date the performance goals were established or were not reflected in the forward-looking financial information used to set such goals. Traditionally the HRCC has used this discretionary authority infrequently and principally to adjust for foreign currency fluctuations necessary to measure our performance results in the same manner the targets were set. Discretionary Adjustments to STI Payout Percentages. The third type of adjustment, as discussed in greater detail above under “—2025 Short-Term Incentive Program,” provides the HRCC with discretionary authority to adjust STI payouts. These discretionary adjustments may be made as either a specific feature of a given year’s STI plan established in advance (for example, the capped individual performance modifier included in our 2025 plan design) or as equitable adjustments made in arrears in connection with the HRCC’s approval of final STI payouts.
Incentive Program Guidelines
| Adjustments Under Our Guidelines For Performance Periods Ending December 31, 2025 | 2025 STI | 2023 PBRS | | Mandatory Adjustments | | | | •See Appendix A for details on the Non-GAAP Special Items previously reported in our February 3, 2026 earnings release | | | | •We adjusted our three-year Cumulative Adjusted EBITDA targets for our 2023 LTI Awards to reflect the net impact of charges and credits related to the sale of our EMEA operations, which closed earlier than anticipated when targets were set, and CDN businesses, which was not anticipated when the targets were set | n/a | | | Discretionary Adjustments | | | | •We adjusted the performance results to true-up the bonus accruals for Adjusted EBITDA in our three-year Cumulative Adjusted EBITDA for our 2023 LTI Awards | | | | •No discretionary adjustments were made to the payout percentages for our 2025 STI Plan. | | n/a | | •We adjusted the performance results to eliminate the effect of foreign currency fluctuations in our three-year Cumulative Adjusted EBITDA for our 2022 LTI Awards | n/a | | | Discretionary Adjustments to STI Payout Percentages | | | | •No discretionary adjustments were made to the payout percentages for our 2025 STI Plan. | | n/a |
Incentive Program Guidelines
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Annual Compensation Package
Annual Compensation Package Mr. Hacker’s initial annual compensation package consisted of: •Base salary of $750,000;(1) •Target annual short‑term incentive (STI) opportunity equal to 100% of base salary; •Target annual long‑term incentive (LTI) opportunity equal to $2,700,000;(2) and •Retirement and health and welfare benefits generally available to all employees. (1)Following an expansion in his scope of responsibilities, which includes our public sector business, Mr. Hacker’s salary was increased to $775,000 in October 2025. For more information see “—Base Salary” above. (2)Following an expansion in his scope of responsibilities, Mr. Hacker’s long-term incentive opportunity was increased to $3,300,000, effective for his 2026 annual LTI award. For more information see “—2025 Long-Term Incentive Compensation” above.
On-Boarding Awards
On-Boarding Awards In addition, the HRCC approved certain on-boarding awards described below. Based on information provided by its independent compensation consultant, the HRCC determined that these awards were customary for executive on-boarding pay packages and, in this case, were necessary to induce Mr. Hacker to join the Company. •Pro-Rated 2025 LTI Award of $2,000,000, representing approximately 74% of his target annual LTI opportunity, granted on his start date and based on terms consistent with the 2025 annual LTI awards(1) granted to our other senior officers in the first quarter. Mr. Hacker’s pro-rated 2025 LTI Award was comprised of 40% ($800,000) in the form of time-vested restricted shares, vesting in three equal annual installments, and 60% ($1,200,000) in the form of performance-based restricted shares, with a three-year cliff vesting subject to performance attainment against relative TSR and Cumulative Free Cash Flow targets, all subject to continued service on the applicable vest dates. •A cash signing bonus of $500,000. This cash award was paid upon his joining the Company, subject to a clawback if Mr. Hacker resigns or is terminated by the Company for “cause” (as defined in our Executive Severance Plan) before the two-year anniversary of his start date. (1)For more information see “—2025 Long-Term Incentive Compensation” above.
Severance Compensation Paid to Ashley Haynes-Gaspar, our Former EVP, Chief Revenue Officer
Severance Compensation Paid to Ashley Haynes-Gaspar, our Former EVP, Chief Revenue Officer As described further below, Ms. Haynes‑Gaspar joined the Company on January 9, 2023, initially overseeing Customer Success, Wholesale, and International, with her responsibilities later expanded to include marketing and her appointment to EVP, Chief Revenue Officer. On January 28, 2026, Ms. Haynes-Gaspar ceased serving as an executive officer, following the hiring of her successor, and, following a short transition period, her employment was involuntarily terminated on March 6, 2026.
Severance Compensation
Severance Compensation In exchange for Ms. Haynes-Gaspar’s delivery of a release of claims in connection with her termination, she will receive the following compensation and benefits payments under our pre-existing executive severance plan and broad-based programs that apply to our employees: •Cash severance payment of $1,300,000(1), and •2025 Short Term Incentive $792,984(2).
Impact on LTI Awards
Impact on LTI Awards In addition to these prior arrangements, the HRCC exercised its discretion to approve the following treatment for a pro-rated portion of her outstanding equity, effective upon her termination and also conditioned on her delivery of a release of claims, and the remaining portion of her outstanding equity were forfeited: •Accelerated vesting of 331,785 shares, of outstanding time-based restricted stock granted to her in 2024 and 2025. •Retention of a pro-rated portion, 125,046 target shares, of her outstanding performance-based restricted stock granted to her in 2025, subject to their original performance conditions and vesting dates as disclosed in “—2025 Long-Term Incentive Compensation” above and the “Outstanding Equity Awards” table, with the remaining 175,068 shares of these target stock awards being forfeited. •Retention of a pro-rated portion of her outstanding performance-based cash granted to her in 2024, with a target value of $1,057,500, subject to their original performance conditions and vesting dates, and the remaining target value of $352,500 being forfeited. For more information please reference our 2025 proxy statement. (1)For more information see “-Other Benefits - Severance Benefits” below. (2)For more information see “Section Five - 2025 Short-Term Incentive Program” above.
Change of Control Arrangements
Change of Control Arrangements We have agreed to provide cash and other severance benefits to each of our executive officers under certain specified circumstances following a “change of control” of Lumen (generally: (1) any person becoming the beneficial owner of 30% or more of the outstanding Common Shares; (2) a majority of our directors being replaced; (3) consummation of certain mergers, substantial asset sales, or similar business combinations; or (4) approval by the shareholders of a liquidation or dissolution of the Company). Under these agreements, “double-trigger” change of control benefits are payable to our executive officers if, within a certain specified period following a change of control (referred to as the “protected period”), the officer is terminated without “cause” or such officer resigns with “good reason.” The table below shows (1) the length of the “protected period” afforded to officers following a change of control and (2) the multiple of annual cash compensation and years of health and welfare benefits to which our officers will be entitled if change of control benefits become payable under our agreements:
Change of Control Arrangements
| | Protected Period | Multiple of Annual Cash Compensation(1) | Years of Welfare Benefits | | CEO | 2 years | 2.5 times | 2 years | | Other NEOs | 1.5 years | 2 times | 2 years | | Other Senior and Executive Officers | 1.5 years | 2 times | 2 years |
Change of Control Arrangements
(1)Annual cash compensation for these purposes is equal to the sum of (i) his or her base salary in effect at the date of termination and (ii) for the CEO, her target STI bonus for the year in which the termination occurs, and, for other executives and officers, the average of his or her STI bonuses for the three years immediately preceding the year in which the termination occurs. Each officer is also entitled to: (1) such officer’s STI bonus for the year of termination, based on actual performance and the portion of the year served; and (2) outplacement assistance for one year.
Change of Control Arrangements
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Change of Control Arrangements
For purposes of these change of control agreements: •“cause” means the officer’s: (1) willful breach of the provisions of his or her change of control agreement pertaining to nondisclosure of confidential information, non-solicitation, non-disparagement, and, where permitted by law, non-competition; (2) conviction of, or plea of guilty or nolo contendere to, a felony or other crime involving dishonesty or moral turpitude; (3) workplace conduct resulting in the payment of civil monetary penalties or the incurrence of civil non-monetary penalties that will materially restrict or prevent him or her from discharging his or her obligations to us; (4) habitual intoxication during working hours or habitual abuse of, or addiction to, a controlled substance; (5) material breach of Board-adopted policies applicable to management conduct; (6) participation in the public reporting of any information contained in any report filed by us with the SEC that was impacted by him or her knowing or intentional fraudulent or illegal conduct; or (7) substantial, willful, and repeated failure to perform his or her duties as instructed by, or on behalf of, the Board in writing; and •“good reason” means: (1) any failure of ours to provide the officer with a position, authority, duties, and responsibilities at least commensurate in all material respects with the most significant of those held, exercised, and assigned by him or her at any time during the 180-day period immediately preceding the change of control; (2) any action that results in a diminution in any material respect in such position, authority, duties, or responsibilities; (3) a reduction of his or her base salary in effect as of the date of the change of control without her consent (except for across-the-board salary reductions similarly affecting all or substantially all similarly-situated officers); (4) he or she is advised of, manifests an awareness of, or becomes aware of facts that would cause a reasonable person to inquire into any failure in any material respect by us to comply with any of the provisions of his or her change of control agreement; or (5) any directive requiring him or her to be based at any office or location more than 50 miles from the office at which she was based immediately prior to the change of control or requiring him or her to travel on business to a substantially greater extent than required immediately prior to the change of control, subject in each case to our right to cure. For more information on change of control arrangements applicable to our executives, including our rationale for providing these benefits, see “Compensation Tables—Potential Termination Payments—Payments Made Upon a Change of Control.” For information on change of control severance benefits payable to our junior officers and managers, see “—Severance Benefits” in the next subsection below.
Severance Benefits
Severance Benefits Over a decade ago, we adopted an Executive Severance Plan to support our management during transitions and demonstrate our commitment to responsible corporate practices. Under our Executive Severance Plan, if an executive officer is involuntarily terminated by us without “cause” or resigns without “good reason,” in each case in the absence of a “change of control,” he or she will receive (i) cash severance payments equal to a multiple of total targeted cash compensation, (ii) subsidized COBRA payments for a period of time, (iii) if employed for at least three months during the year of termination, a prorated annual bonus for the year of termination based on actual performance, and (iv) outplacement assistance. Severance benefits in connection with a qualifying termination related to a change of control are governed by each officer’s change of control agreement and described above. The table below shows the multiple of total targeted cash compensation and years of COBRA benefits to which the executive officer will be entitled upon a qualifying termination, which benefits are subject to the officer’s execution of a release of claims in our favor and continued compliance with any applicable restrictive covenants:
Severance Benefits
| | Multiple of Total Targeted Cash Compensation(1) | Years of COBRA | | CEO | 2 times | 1 year | | Other Executives and Senior Officers | 1 time | 1 year |
Severance Benefits
(1)Total targeted cash compensation for these purposes is equal to the sum of (i) his or her base salary and (ii) his or her target STI bonus opportunity in effect at the date of termination.
Severance Benefits
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Severance Benefits
Under our Executive Severance Plan: •“cause” means the employee’s: (1) failure to substantially comply with supervisor directives, including directives related to job performance; (2) misconduct; (3) conduct that violates our ethics and compliance program, including our Code of Conduct; (4) conduct that is injurious to our reputation, customer relationships, employees, or finances; (5) act(s) that, if proven in a court of law, would constitute a felony crime; (6) act(s) of dishonesty, fraud, or moral turpitude; or (7) violation of any of the restrictive covenants found in the plan (e.g., with respect to misuse of our proprietary information, competing with us while an employee or during the 12 months after termination, and inducing our employees or customers to terminate their relationship with us or provide services to one of our competitors while an employee or during the 12 months after termination); and •“good reason” means an employee’s resignation following our offer to him or her of a “non-comparable position (i.e., one offered as part of a reduction in headcount or certain corporate transactions like a sale that do not constitute a change of control which would result in the employee having to relocate by more than 50 miles in driving distance or has a total targeted compensation that is 90% or less than his or her then-current total targeted compensation), subject to our right to cure. Under a policy that we adopted in 2012, we have committed to seek shareholder approval of any future senior executive severance agreements providing for cash payments, perquisites, and accelerated health and welfare benefits with a value greater than 2.99 times the sum of the executive’s base salary plus target bonus.
Forfeiture and Clawback of Incentive Compensation
Forfeiture and Clawback of Incentive Compensation Our Corporate Governance Guidelines authorizes our Board to recover, or “clawback,” compensation from an executive officer if the Board determines that any bonus, incentive payment, equity award, or other compensation received by the executive was based on any financial or operating result that was impacted by the executive’s knowing or intentional fraudulent or illegal conduct. To date, no NEOs have been subject to any clawbacks. Equity Compensation. For all of our outstanding equity awards, all recipients of our LTI grants have been required to contractually agree to forfeit their awards if, at any time during their employment with us or within 18 months after termination of employment, they engage in activity contrary or harmful to our interests. For unvested equity compensation, the recipient would forfeit any rights to future vesting of equity awards. We can clawback previously vested equity by requiring the recipient to return to us any cash, securities, or other assets received by him or her upon the sale of Common Shares he or she acquired through prior equity awards. Short-Term Incentive Compensation. Our STI Program contains substantially similar forfeiture provisions under which the recipient would forfeit any rights to future payments of certain STI awards if, at any time during his or her employment with us (or after termination of employment and prior to the payment of the prior year’s STI bonus), he or she engages in activity contrary or harmful to our interests. Dodd-Frank Clawback Policy. In compliance with NYSE listing standards and final SEC rules under the Dodd-Frank Act, effective October 2, 2023, the HRCC and our Board adopted the Policy for the Recovery of Erroneously Awarded Compensation (the “Dodd-Frank Clawback Policy”) that requires Lumen to recoup cash and/or equity incentive compensation paid in the event of certain accounting restatements that correct an error in the Company’s financial statements. The Dodd-Frank Clawback Policy operates in addition to our other forfeiture and clawback policies and plan or award provisions described above.
Use of Employment Agreements
Use of Employment Agreements We have a long-standing practice of not providing traditional employment agreements to our officers and none of our executives has an employment agreement. However, we do from time to time enter into initial employment offer letters with prospective new employees, including executive officers, some of which include future commitments on our part. The offer letter, dated September 12, 2022, we entered into with Ms. Johnson in connection with her initial appointment as our CEO contains certain commitments by the Company with respect to the impact of termination on her equity awards, which ended on the third anniversary of her start date and are described in greater detail under “Compensation Tables—Potential Termination Payments.” Her offer letter also entitles her to certain personal use of private aircraft, as described under “—Perquisites” above.
Summary Compensation Table
Summary Compensation Table The following table sets forth the compensation paid to each of our NEOs in all capacities in which they served for fiscal years 2023, 2024, and 2025.
Summary Compensation Table
Summary Compensation Table
Summary Compensation Table
| Name and Principal Position | Year | Salary | Bonus(1) | Stock Awards(2) | Non-Equity Incentive Plan Compensation(3) | All Other Compensation(4) | Total | | Current Executive Officers(5) | | | | | | | | | Kate Johnson President and CEO | 2025 | $1,354,493 | $— | $18,590,663 | $4,877,486 | $113,999 | $24,936,641 | | | 2024 | 1,283,607 | — | 6,135,630 | 2,957,252 | 123,502 | 10,499,991 | | | 2023 | 1,200,000 | — | 6,215,329 | 1,996,800 | 180,834 | 9,592,963 | | Chris D. Stansbury EVP and CFO | 2025 | $850,000 | $— | $10,198,792 | $1,946,099 | $87,829 | $13,082,720 | | | 2024 | 841,803 | — | 2,368,137 | 1,117,496 | 30,300 | 4,357,736 | | | 2023 | 800,000 | — | 3,271,226 | 915,200 | 10,354 | 4,996,780 | | Mark Hacker EVP, Chief Legal Officer & Public Sector | 2025 | $486,164 | $500,000 | $2,641,607 | $696,289 | $14,000 | $4,338,060 | | Former Executive Officers | | | | | | | | | Ashley Haynes-Gaspar(6) Former EVP, Chief Revenue Officer | 2025 | $645,962 | $— | $2,791,565 | $792,984 | $20,438 | $4,250,949 | | | 2024 | 625,019 | 250,000 | 1,011,840 | 663,770 | 21,462 | 2,572,091 | | | 2023 | 553,972 | 250,000 | 2,160,675 | 483,950 | 9,000 | 3,457,597 | | David Ward(7) Former EVP, Chief Technology & Product Officer | 2025 | $770,959 | $312,500 | $4,098,262 | $1,051,589 | $14,000 | $6,247,310 | | | 2024 | 622,920 | 1,000,000 | 2,481,228 | 661,541 | 13,800 | 4,779,489 |
Summary Compensation Table
(1)For Mr. Hacker in 2025, Ms. Haynes-Gaspar in 2023 and 2024, and Mr. Ward in 2024, the amounts in this column represent an on-boarding bonus, which for Messrs. Hack and Ward was paid following their respective start dates and for Ms. Haynes-Gaspar, was paid in two equal installments following her start date and one-year anniversary of her start date, subject to a clawback if the NEO voluntarily resigns or is terminated for “cause” (as defined in our Executive Severance Plan) before the two-year anniversary of his or her start date. For additional information regarding the on-boarding bonuses, see “Section Five—Compensation Design, Awards, and Payouts for 2025—Compensation Arrangements Related to Leadership Transition” in our CD&A. For Mr. Ward in 2025, the amount in this column represents the first installment, one-quarter of the target amount of $1,250,000, of his 2024 on-boarding time-based long-term cash award. (2)For 2025 and 2023, the amounts shown in this column reflect the fair value of grants of time-vested and performance-based restricted stock awards, and for 2024, the amounts shown in this column reflect the fair value of grants of time-vested restricted stock, made to our NEOs under our LTI program for the respective years. The fair value of the restricted stock awards presented in the table above has been determined in accordance with FASB ASC Topic 718, rather than the stock price used to calculate the number of shares underlying the awards, which was the 15-day volume-weighted average closing price prior to the date of grant ($4.40-4.72). For 2025, the fair value of the time-vested and performance-based restricted stock awards, based on the closing trading price of our Common Shares on the day of grant, as well as certain adjustments and assumptions set forth in Note 12 - Stock-Based Compensation of the notes to our audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (Appendix B), is ($4.31-4.81) and ($4.31-7.16), respectively. As a result, the values reported in this column are 19-32% higher than the NEOs’ total target grant values for 2025. The aggregate value of the LTI awards granted to each named executive in 2025, assuming maximum payout of his or her performance-based award, would be as follows: Ms. Johnson, $30,772,361, Mr. Stansbury, $14,869,086, Mr. Hacker, $4,356,258, Ms. Haynes-Gaspar, $4,620,760, and Mr. Ward, $6,783,682. For 2024, we granted long-term performance-based cash awards to our then-NEOs and an on-boarding long-term cash award to Mr. Ward. In accordance with SEC rules, all of these cash LTI awards were not reported in the "Summary Compensation Table" for 2024, and will only be reflected in the “Summary Compensation Table—Bonus” column in our future proxy statements, if and when earned. As a result, the 2024 values reported in this column are significantly lower than the NEOs’ values for 2025. For more information on our 2025 LTI awards, see the section entitled, “Section Five—Compensation Design, Awards, and Payouts for 2025—2025 Long-Term Incentive Compensation” in our CD&A. For more information on our 2024 and 2023 LTI awards, see our 2025 Proxy Statement and 2024 Proxy Statement, respectively.
Summary Compensation Table
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Summary Compensation Table
(3)The amounts shown in this column reflect cash payments made under our short-term incentive program for actual performance for the respective years. For additional information, see “Section Five—Compensation Design, Awards, and Payouts for 2025—2025 Short-Term Incentive Program” in our CD&A. (4)We calculate the aggregate incremental cost based on the payments made by us to provide the applicable benefit. For fiscal 2025, the amounts shown in this column are comprised of (i) the cost of personal use of aircraft via NetJets; (ii) Company contributions or other allocations to our defined contribution plans; (iii) personal identity theft protection service; and (iv) personal security costs, in each case for and on behalf of the named executives as follows:
Grant of Plan Based Awards
Grant of Plan Based Awards The following table presents additional information regarding all equity and non-equity incentive plan awards granted to our NEOs in fiscal 2025.
Grants of Plan-Based Awards
Grants of Plan-Based Awards
Grants of Plan-Based Awards
| NEO | Type of Award and Grant Date(1) | Estimated Future Payouts Under Non-Equity Incentive Plan Awards (STI)(2) | | | Estimated Future Payouts Under Equity Incentive Plan Awards (LTI)(3) | | | All Other Stock Awards: Unvested Shares(4) (#) | Grant Date Fair Value of All Other Stock Awards(5) ($) | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | Current EOs | | | | | | | | | | | Ms. Johnson | STI Bonus | $1,489,946 | $2,979,891 | $5,959,782 | | | | | | | | TBRS—Annual | | | | | | | 1,332,425 | $6,408,964 | | | PBRS - FCF | | | | 499,660 | 999,319 | 1,998,638 | | 5,026,575 | | | PBRS - rTSR | | | | 499,660 | 999,319 | 1,998,638 | | 7,155,124 | | Mr. Stansbury | STI Bonus | $620,330 | $1,240,660 | $2,481,320 | | | | | | | | TBRS—Annual | | | | | | | 510,834 | $2,457,112 | | | PBRS - FCF | | | | 191,563 | 383,125 | 766,250 | | 1,927,119 | | | PBRS - rTSR | | | | 191,563 | 383,125 | 766,250 | | 2,743,175 | | | TBRS—Special | | | | | | | 638,542 | 3,071,387 | | Mr. Hacker | STI Bonus | $243,084 | $486,167 | $972,335 | | | | | | | | TBRS—Annual | | | | | | | 215,071 | $926,956 | | | PBRS - FCF | | | | 80,652 | 161,303 | 322,606 | | 695,216 | | | PBRS - rTSR | | | | 80,652 | 161,303 | 322,606 | | 1,019,435 | | Former Officers | | | | | | | | | | | Ms. Haynes- Gaspar(6) | STI Bonus | $322,982 | $645,963 | $1,291,926 | | | | | | | | TBRS—Annual | | | | | | | 200,077 | $962,370 | | | PBRS - FCF | | | | 75,029 | 150,057 | 300,114 | | 754,787 | | | PBRS - rTSR | | | | 75,029 | 150,057 | 300,114 | | 1,074,408 | | Mr. Ward(7) | STI Bonus | $385,480 | $770,960 | $1,541,920 | | | | | | | | TBRS—Annual | | | | | | | 293,730 | $1,412,841 | | | PBRS - FCF | | | | 110,149 | 220,297 | 440,594 | | 1,108,094 | | | PBRS - rTSR | | | | 110,149 | 220,297 | 440,594 | | 1,577,327 |
Grants of Plan-Based Awards
(1)Definitions of these terms and information on the grant dates appear elsewhere in these footnotes. The LTI awards granted on March 1, 2025 were approved by our HRCC on February 19, 2025, the LTI awards granted to Mr. Hacker on May 12, 2025 were approved by the HRCC on April 28, 2025. (2)Consists of potential payouts under the annual STI bonus program for our NEOs for 2025 approved on February 18, 2025. The target is equal to the product of the executive’s earned base salary and his or her STI target bonus percentage. The threshold represents 50% of the executive’s target, as for each of the three measures of our performance (Adjusted EBITDA (50%), revenue (25%), and core priorities(25%)), performance below 50% of that measure’s target would have resulted in no payment to the executive with respect thereto. The maximum represents 200% of the executive’s target, as in no event could an executive have received more than 200% of his or her target even if performance was 200% for each measure of our performance and his or her individual performance was assessed at 120% of target. Further, while not reflected in the table, the bonus otherwise payable to any NEO could have been eliminated based on his or her individual performance. See “Section Five—Compensation Design, Awards, and Payouts for 2025—2025 Short-Term Incentive Program” in our CD&A for more information. The actual amounts paid for 2025 performance are reported in the “Non-Equity Incentive Plan Compensation” column of the "Summary Compensation Table." (3)Consists of the performance-based portion of our 2025 LTI awards granted in the form of performance-based restricted stock on March 1, 2025 to each of Messes. Johnson and Haynes-Gaspar and Messrs. Stansbury and Ward, and on May 12, 2025 to Mr. Hacker. Performance under each award will be measured over the three-year period from January 1, 2025 to December 31, 2027, half against our relative TSR (PBRS-rTSR) and half against our cumulative Free Cash Flow (PBRS-FCF). The awards to our current NEOs will vest, if at all, on March 1, 2028, generally subject to continued employment through the relevant vesting date. Payout under these awards, if any, may range between zero to 200% of target. See “Section Five—Compensation Design, Awards, and Payouts for 2025—2025 Long-Term Incentive Compensation” in our CD&A for more information. (4)Consists of time-based restricted stock (TBRS). For each of our NEOs, it includes the time-based portion of our 2025 LTI awards (TBRS-Annual) granted on March 1, 2025 to each of Messes. Johnson and Haynes-Gaspar and Messrs. Stansbury and Ward, and on May 12, 2025 to Mr. Hacker. One-third of the TBRS-Annual granted to Messes. Johnson and Haynes-Gaspar and Messrs. Stansbury vested on March 1, 2026, and the remainder will vest in two equal installments on each of the next two anniversaries of the grant date, generally subject to continued employment through the relevant vesting date. The awards to Mr. Ward were canceled upon his resignation on January 23, 2026. See “Section Five—2025 Long-Term Incentive Compensation” in our CD&A for more information. (5)Calculated in accordance with FASB ASC Topic 718 in the manner described in Note 2 to the "Summary Compensation Table" above. (6)A prorated portion of Ms. Haynes-Gaspar’s PBRS were forfeited when her employment ended on March 6, 2026. (7)All of Mr. Ward’s TBRS and PBRS awards were forfeited when his employment ended on January 23, 2026.
Grants of Plan-Based Awards
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Grants of Plan-Based Awards
For more information, see “—Section Five—Compensation Design, Awards, and Payouts for 2025” and “—Potential Termination Payments.”
Outstanding Equity Awards
Outstanding Equity Awards The following table summarizes information about all outstanding unvested equity awards held by our NEOs as of December 31, 2025.
Stock Vested During 2025
Stock Vested During 2025
Stock Vested During 2025
| Name | Number of Shares Acquired on Vesting (#)(1) | Value Realized on Vesting ($)(2) | | Current NEOs | | | | Ms. Johnson | 1,806,722 | $9,206,560 | | Mr. Stansbury | 795,643 | $3,646,412 | | Mr. Hacker | — | — | | Former Officers | | | | Ms. Haynes-Gaspar | 341,371 | $1,671,010 | | Mr. Ward | 439,116 | $2,058,944 |
Stock Vested During 2025
(1)Represents time-vested equity awards that vested during 2025. (2)Based on the closing trading price of a Common Share on the applicable vesting date.
CEO Pay Ratio Disclosure
CEO Pay Ratio Disclosure As required by SEC rules, we are disclosing a ratio of the pay of our CEO to that of our median employee. For 2025, the total compensation of our CEO, Ms. Johnson (as reported in the "Summary Compensation Table") was $24,936,641, while the annual total compensation for our median employee was $96,065. As a result, the ratio of CEO pay to median employee pay was approximately 260 to 1. We calculated our 2025 pay ratio using the following assumptions: •Median employee determination. The median employee was determined by reviewing the annual total target compensation (i.e., the sum of base salary, target short-term incentive, and target long-term incentive awards) as of December 31, 2025 for the approximately 24,000 active employees employed on that date, excluding our CEO. •Median employee identification. The median employee was identified as an Infrastructure Engineer II, employed by us in the U.S. for ten years. •Median employee total compensation calculation. To determine the median pay ratio, we calculated the median employee’s pay using the same pay elements and calculation methodology as used in determining the CEO’s pay for purposes of disclosure in the "Summary Compensation Table." The SEC rules permit companies to choose between different methodologies for median pay calculations. Other public companies may calculate their pay ratio using a different methodology than ours, and you should not assume our ratio data is comparable to that of other companies.
CEO Pay Ratio Disclosure
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Pay Versus Performance Disclosure
Pay Versus Performance Disclosure In accordance with rules adopted by the SEC pursuant to the Dodd-Frank Act , we provide the following disclosure regarding executive compensation for our principal executive officers (“PEOs”) and Non-PEO NEOs and Company performance for the fiscal years listed below. The HRCC did not consider the pay versus performance disclosure below in making its pay decisions for any of the years shown.
Pay Versus Performance Disclosure
| Year | Summary Compensation Table Total for PEO 1(1) ($) | | Summary Compensation Table Total for PEO 2(1) ($) | Compensation Actually Paid to PEO 1(1),(2),(3) ($) | | Compensation Actually Paid to PEO 2(1),(2),(3) ($) | Average Summary Compensation Table Total for Non-PEO NEOs(1) ($) | Average Compensation Actually Paid to Non-PEO NEOs(1),(2),(3) ($) | Value of Initial Fixed $100 Investment based on:(4) | | Net Income ($ Millions) | Adjusted EBITDA(5) ($ Millions) | | | | | | | | | | | TSR ($) | Peer Group TSR ($) | | | | 2025 | | | $24,936,641 | | | $59,356,696 | $6,979,760 | $15,066,691 | $91.91 | $213.25 | $(1,739) | $2,613 | | 2024 | | — | 10,499,991 | | — | 32,495,808 | 3,707,845 | 7,297,378 | 62.81 | 159.67 | (55) | 3,445 | | 2023 | | — | 9,592,963 | | — | 7,258,427 | 3,396,054 | 1,846,687 | 21.65 | 113.86 | (10,298) | 4,146 | | 2022 | | 19,816,806 | 4,778,130 | | (5,200,491) | 4,368,986 | 5,145,256 | 511,978 | 61.75 | 73.08 | (1,548) | 6,703 | | 2021 | | 22,654,781 | — | | 32,390,881 | — | 4,057,947 | 5,127,580 | 138.85 | 121.57 | 2,033 | 8,424 |
Pay Versus Performance Disclosure
(1)Jeffery K. Storey was our PEO from May 24, 2018 to November 7, 2022 (“PEO 1”). Kate Johnson has been our PEO since November 7, 2022 (“PEO 2”). The individuals comprising the Non-PEO NEOs for each year presented are listed below.
Pay Versus Performance Disclosure
| 2021 | 2022 | 2023 | 2024 | 2025 | | Indraneel Dev | Stacey W. Goff | Stacey W. Goff | Chris D. Stansbury | Chris D. Stansbury | | Stacey W. Goff | Chris D. Stansbury | Chris D. Stansbury | Ashley Haynes-Gaspar | David Ward | | Shaun C. Andrews | Shaun C. Andrews | Ashley Haynes-Gaspar | David Ward | Ashley Haynes-Gaspar | | Scott A. Trezise | Scott A. Trezise | Scott A. Trezise | Chadwick Ho | Mark Hacker | | | Indraneel Dev | | Satish Lakshmanan | | | | | | Stacey. W. Goff | |
Pay Versus Performance Disclosure
(2)The amounts shown for Compensation Actually Paid have been calculated in accordance with Item 402(v) of Regulation S-K and do not reflect compensation actually earned, realized, or received by the Company’s NEOs. These amounts reflect the "Summary Compensation Table" total compensation, with certain adjustments as described in footnote 3 below. (3)For 2025, Compensation Actually Paid reflects the exclusions and inclusions of certain amounts for the PEOs and the Non-PEO NEOs as set forth below. Equity values are calculated in accordance with FASB ASC Topic 718. Amounts in the Exclusion of Stock Awards column are the totals from the Stock Awards column set forth in the "Summary Compensation Table." Amounts in the Exclusion of Change in Pension Value column reflect the amounts, if any, attributable to the Change in Pension Value reported in the "Summary Compensation Table." There are no amounts reported in the Inclusion of Pension Service Cost, because with limited exceptions specified in the Pension Plans, we “froze” our defined benefit pension plans as of December 31, 2010, as described under the heading “—Pension Benefits.”
Pay Versus Performance Disclosure
| Year | Summary Compensation Table Total for PEO 2 ($) | Exclusion of Change in Pension Value for PEO 2 ($) | Exclusion of Stock Awards for PEO 2 ($) | Inclusion of Pension Service Cost for PEO 2 ($) | Inclusion of Equity Values for PEO 2 ($) | Compensation Actually Paid to PEO 2 ($) | | 2025 | $24,936,641 | $— | $(18,590,663) | $— | $53,010,718 | $59,356,696 |
Pay Versus Performance Disclosure
| Year | Average Summary Compensation Table Total for Non-PEO NEOs ($) | Average Exclusion of Change in Pension Value for Non-PEO NEOs ($) | Average Exclusion of Stock Awards for Non-PEO NEOs ($) | Average Inclusion of Pension Service Cost for Non-PEO NEOs ($) | Average Inclusion of Equity Values for Non-PEO NEOs ($) | Average Compensation Actually Paid to Non-PEO NEOs ($) | | 2025 | $6,979,760 | $— | $(4,932,557) | $— | $13,019,488 | $15,066,691 |
Pay Versus Performance Disclosure
| | | 127 | | 2025 ANNUAL REPORT | 2026 PROXY STATEMENT | |
Pay Versus Performance Disclosure
The amounts in the “Inclusion of Equity Values” columns in the tables above are derived from adding or deducting the amounts set forth in the following tables:
Pay Versus Performance Disclosure
| Year | Year-End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for PEO 2 ($) | Change in Fair Value from Last Day of Prior Year to Last Day of Year of Unvested Equity Awards for PEO 2 ($) | Vesting-Date Fair Value of Equity Awards Granted During Year that Vested During Year for PEO 2 ($) | Change in Fair Value from Last Day of Prior Year to Vesting Date of Unvested Equity Awards that Vested During Year for PEO 2 ($) | Fair Value at Last Day of Prior Year of Equity Awards Forfeited During Year for PEO 2 ($) | Total—Inclusion of Equity Values for PEO 2 ($) | | 2025 | $38,684,930 | $14,712,922 | $— | $(387,134) | $— | $53,010,718 |
Pay Versus Performance Disclosure
| Year | Average Year- End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for Non-PEO NEOs ($) | Average Change in Fair Value from Last Day of Prior Year to Last Day of Year of Unvested Equity Awards for Non- PEO NEOs ($) | Average Vesting- Date Fair Value of Equity Awards Granted During Year that Vested During Year for Non-PEO NEOs ($) | Average Change in Fair Value from Last Day of Prior Year to Vesting Date of Unvested Equity Awards that Vested During Year for Non-PEO NEOs ($) | Average Fair Value at Last Day of Prior Year of Equity Awards Forfeited During Year for Non-PEO NEOs ($) | Total—Average Inclusion of Equity Values for Non-PEO NEOs ($) | | 2025 | $10,093,472 | $3,174,236 | $— | $(248,220) | $— | $13,019,488 |
Pay Versus Performance Disclosure
(4)The Peer Group TSR set forth in this table utilizes the S&P 500 Communication Services Sector Index, which we also utilize in the stock performance graph appearing herein under the heading “Other Matters—Lumen Performance History.” The comparison assumes $100 was invested for the period starting December 31, 2020, through the end of the listed year in the Company and in the S&P 500 Communication Services Sector Index, respectively. Historical stock performance is not necessarily indicative of future stock performance. (5)We determined Adjusted EBITDA to be the most important financial performance measure used to link Company performance to Compensation Actually Paid to our PEO 2 and Non-PEO NEOs in 2025. Adjusted EBITDA measures the operational performance and profitability of our businesses, and we use this measure in our compensation programs to incentivize and reward our senior officers to focus on the combination of cost savings and profitable revenue growth. Adjusted EBITDA, which is described in further detail in Appendix A – Non-GAAP Reconciliations, is a non-GAAP metric. This performance measure may not have been the most important financial performance measure for prior years, and we may determine a different financial performance measure to be the most important financial performance measure in future years.
Pay Versus Performance Disclosure
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Relationship Between PEO and Non-PEO NEO Compensation Actually Paid and Company Total Shareholder Return (“TSR”) and Peer Group TSR
Relationship Between PEO and Non-PEO NEO Compensation Actually Paid and Company Total Shareholder Return (“TSR”) and Peer Group TSR The following chart sets forth the relationship between Compensation Actually Paid to our PEOs, the average of Compensation Actually Paid to our Non-PEO NEOs, and the Company’s cumulative TSR over the five most recently completed fiscal years. The chart also compares the Company’s TSR to that of the S&P 500 Communications Services Sector Index TSR over the same period.
PEO and Average Non-PEO NEO Compensation Actually Paid Versus TSR
PEO and Average Non-PEO NEO Compensation Actually Paid Versus TSR
Relationship Between PEO and Non-PEO NEO Compensation Actually Paid and Net Income
Relationship Between PEO and Non-PEO NEO Compensation Actually Paid and Net Income The following chart sets forth the relationship between Compensation Actually Paid to our PEOs, the average of Compensation Actually Paid to our Non-PEO NEOs, and our Net Income during the five most recently completed fiscal years.
PEO and Average Non-PEO NEO Compensation Actually Paid Versus Net Income
PEO and Average Non-PEO NEO Compensation Actually Paid Versus Net Income
PEO and Average Non-PEO NEO Compensation Actually Paid Versus Net Income
| | | 129 | | 2025 ANNUAL REPORT | 2026 PROXY STATEMENT | |
Relationship Between PEO and Non-PEO NEO Compensation Actually Paid and Adjusted EBITDA
Relationship Between PEO and Non-PEO NEO Compensation Actually Paid and Adjusted EBITDA The following chart sets forth the relationship between Compensation Actually Paid to our PEOs, the average of Compensation Actually Paid to our Non-PEO NEOs, and our Adjusted EBITDA during the five most recently completed fiscal years.
PEO and Average Non-PEO NEO Compensation Actually Paid Versus Adjusted EBITDA
PEO and Average Non-PEO NEO Compensation Actually Paid Versus Adjusted EBITDA
Pension Benefits
Pension Benefits United States funding laws require a company with a pension shortfall to fund the annual cost of benefits earned in addition to a seven-year amortization of the shortfall. Our funding policy for our Combined Pension Plan is to make contributions with the objective of accumulating ample assets to pay all qualified pension benefits when due under the terms of the plan. The accounting unfunded status of the Combined Pension Plan was $559 million and $615 million as of December 31, 2025 and 2024, respectively. We made no voluntary cash contributions to the trust for the Combined Pension Plan in 2025. In 2024, we made a voluntary cash contribution of $170 million to the trust for the Combined Pension Plan. We paid $4 million of benefits directly to participants of our non-qualified pension plans in both 2025 and 2024. Benefits paid by the Combined Pension Plan are paid through a trust that holds all the Plan's assets. The amount of required contributions to the Combined Pension Plan in 2026 and beyond will depend on a variety of factors, most of which are beyond our control, including earnings on plan investments, prevailing interest rates, demographic experience, changes in plan benefits and changes in funding laws and regulations. Based on current laws and circumstances, we do not believe we are required to make any contributions to the Combined Pension Plan in 2026. We estimate that in 2026 we will pay approximately $4 million of benefits directly to participants of our non-qualified pension plans.
Pension Benefits
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Pension Benefits
We recognize in our consolidated balance sheets the funded status of the legacy Level 3 Parent, LLC qualified defined benefit post-retirement plan. This plan was fully funded as of December 31, 2025 and 2024. Additionally, as previously mentioned, we sponsor unfunded non-qualified pension plans for certain current and former highly-compensated employees. The net unfunded status of our non-qualified pension plans was $29 million and $30 million for the years ended December 31, 2025 and 2024, respectively. Due to the insignificant impact of these pension plans on our consolidated financial statements, we have predominantly excluded them from the remaining employee benefit disclosures in this Note, unless otherwise specifically stated.

DEF 14A of Lumen Technologies, Inc.

Director Nominees

Director Nominees

Director Nominees

Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Our Director Nominees

Director Compensation

Cash and Stock Payments

2025 Compensation of Outside Directors

Directors’ Compensation

Non-Qualified Deferred Compensation

2025 Executive Compensation Aligned with Business Performance

2025 Short-Term Incentive Compensation

Dollars in Millions

2023 Long-Term Incentive Compensation

Dollars in Millions

Our Compensation Best Practices

Aligning Performance Objectives with Strategy

Equity Grant Timing Practices

Equity Grant Timing Practices

Role of Compensation Consultants

Role of Peer Groups

Compensation Peer Group

Compensation Peer Group

Assessment Process

2025 Compensation Peer Group

2026 Compensation Peer Group

2026 Compensation Peer Group

2026 Compensation Peer Group

TSR Benchmark and Peer Group

Assessment Process

2025 TSR Peer Group

2026 TSR Benchmark

2026 TSR Benchmark

Section Five—Compensation Design, Awards, and Payouts for 2025

Our Pay Elements

Target Compensation

Base Salary

2025 Short-Term Incentive Program

2025 Short-Term Incentive Program

2025 Short-Term Incentive Program

2025 Short-Term Incentive Program

2025 STI Target Bonus Opportunity

2025 STI Target Bonus Opportunity

2025 STI Target Bonus Opportunity

2025 STI Metrics and Results

Calculation of Achieved Payout

Calculation of Achieved Payout

Calculation of Achieved Payout

Calculation of Achieved Payout

Calculation of Achieved Payout

Calculation of Achieved Payout

Calculation of Achieved Payout

Calculation of Achieved Payout

Calculation of Achieved Payout

Calculation of Achieved Payout

Qualitative Performance Assessment

2) Individual Performance Modifier

2025 STI Payouts

2025 STI Bonus Amounts

2025 STI Bonus Amounts

2025 STI Bonus Amounts

2025 Long-Term Incentive Compensation

2025 LTI Program

2025 LTI Program Metrics and Weightings

2025 LTI Program Metrics and Weightings