DEF 14A of Verizon Communications Inc, Mar 19, 2018

DEF 14A of Verizon Communications Inc

Filed Mar 19, 2018 · FY20170001193125-18-087697

Open on EDGAR

  1. Item 1: Election of Directors

    Item 1: Election of Directors

  2. Nominees for election

    Nominees for election Our Board has nominated the 11 candidates below for election as Directors, all of whom currently serve as Directors of Verizon. After completing the evaluation process described above, the Corporate Governance and Policy Committee and our Board concluded that these Directors should be nominated for re-election. We describe their respective experience, qualifications, attributes and skills below. The Committee and the Board assessed these factors in light of Verizon’s strategy and businesses, which provide a broad array of communications, information and entertainment products and services to individuals, businesses, governments and wholesale customers in the United States and around the world. Each candidate has consented to stand for election, and we do not anticipate that any candidate will be unavailable to serve. If any candidate were to become unavailable before the election, the proxy committee could vote the shares it represents for a substitute named by the Board. Each candidate has submitted an irrevocable, conditional letter of resignation that our Board will consider if that candidate fails to receive a majority of the votes cast.

  3. Nominees for election

    | | Our Board of Directors recommends that you vote for each of the following candidates. |

  4. Nominees for election

    | 6 | | Verizon 2018 Proxy Statement |

  5. Nominees for election

    | Director since 2013 Age 55 Independent Committees | Shellye L. Archambeau Ms. Archambeau is the former Chief Executive Officer of MetricStream, Inc., a leading provider of governance, risk, compliance and quality management solutions to corporations across diverse industries. She served in this role from the time she joined MetricStream in 2002 until 2018. Prior to that, Ms. Archambeau served as Chief Marketing Officer and Executive Vice President of Sales for Loudcloud, Inc., Chief Marketing Officer of NorthPoint Communications, and President of Blockbuster Inc.’s e-commerce division. Before she joined Blockbuster, she held domestic and international executive positions during a 15-year career at IBM. Ms. Archambeau has served on the board of Nordstrom, Inc. since 2015, and in the past five years, she has served on the board of Arbitron, Inc. Qualifications: Ms. Archambeau provides the Board with valuable knowledge of technology, e-commerce, digital media and communications platforms. Her experiences in the Silicon Valley emerging company community, as well as her prior experience at IBM, provide her with global perspectives on developing and marketing emerging technology applications and solutions. |

  6. Nominees for election

    | Director since 2015 Age 61 Independent Committee | Mark T. Bertolini Mr. Bertolini is Chairman and Chief Executive Officer of Aetna Inc., a Fortune 100 diversified healthcare benefits company. Prior to assuming the role of Aetna’s CEO in 2010 and Chairman in 2011, Mr. Bertolini served as President from 2007, responsible for all of Aetna’s businesses and operations across the company’s range of healthcare products and related services. He also served as Executive Vice President and head of Aetna’s regional businesses. Mr. Bertolini joined Aetna in 2003 as head of Aetna’s Specialty Products after holding executive positions at Cigna, NYLCare Health Plans and SelectCare, Inc. Qualifications: Mr. Bertolini’s experience at a large, multinational corporation provides the Board with valuable operational and management expertise, as well as critical perspective on strategic planning. His role as Chairman and CEO of Aetna provides the Board with additional insights into the healthcare industry. |

  7. Nominees for election

    | Verizon 2018 Proxy Statement | | 7 |

  8. Nominees for election

    | Director since 1997 Age 65 Independent Committees | Richard L. Carrión Mr. Carrión is Executive Chairman of Popular, Inc., a diversified bank holding company. Prior to assuming his current position in 2017, Mr. Carrión served as Chairman and Chief Executive Officer of Popular, Inc. for over 20 years. Mr. Carrión served as a director of the Federal Reserve Bank of New York, a government-organized financial and monetary policy organization, from 2008 to 2015. He also served as a director of NYNEX Corporation, one of Verizon’s predecessor companies, from 1995 to 1997. Qualifications: Mr. Carrión provides the Board with financial, operational and strategic expertise developed during his long tenure at Popular, Inc. This experience, combined with his board service at the Federal Reserve Bank of New York, also provides the Board with extensive risk management expertise. |

  9. Nominees for election

    | Director since 2011 Age 56 Independent Committee | Melanie L. Healey Ms. Healey is the former Group President of The Procter & Gamble Company, one of the leading providers of branded consumer packaged goods. She served in this role from 2007 to 2015. During her tenure at Procter & Gamble beginning in 1990, Ms. Healey held a number of positions of responsibility, including Group President and advisor to the Chairman and CEO, Group President of North America and Group President for the Global Feminine and Health Care Sector. Ms. Healey has served as a director of Hilton Worldwide Holdings Inc. since September 2017, PPG Industries, Inc. since 2016 and Target Corporation since 2015. Qualifications: Ms. Healey provides the Board with valuable strategic, branding, distribution and operating experience on a global scale obtained over her 32-year career in the consumer goods industry. Her deep experience in marketing and operations, including her 18 years outside the United States, provides the Board with strategic and operational leadership and critical insights into brand building and consumer marketing trends globally. |

  10. Nominees for election

    | 8 | | Verizon 2018 Proxy Statement |

  11. Nominees for election

    | Director since 2006 Age 71 Independent Committees | M. Frances Keeth (Lead Director) Ms. Keeth was Executive Vice President of Royal Dutch Shell plc, a global energy company, from 2001 to 2006, and was Chief Executive Officer of Shell Chemicals Limited from 2004 to 2006. During her long tenure at Royal Dutch Shell, Ms. Keeth served in a number of other positions of responsibility, including Executive Vice President, Finance and Business Systems, and Executive Vice President, Customer Fulfillment and Product Business Units. Before holding these positions, Ms. Keeth was controller and principal accounting officer of Mobil Corporation. Ms. Keeth has served as a director of Arrow Electronics, Inc. since 2004, and in the past five years, she has served as a director of Peabody Energy Corporation. Qualifications: Ms. Keeth’s career with Shell has provided her with substantial experience in managing worldwide operations and strategic partnerships in a capital-intensive business. Her expertise provides the Board with critical skills in the areas of financial oversight, aligning financial and strategic initiatives, and risk management. |

  12. Nominees for election

    | Director since 2011 Age 63 Chairman since 2012 | Lowell C. McAdam (Chairman) Mr. McAdam is Chairman (since 2012) and Chief Executive Officer (since 2011) of Verizon Communications Inc. Prior to becoming CEO, Mr. McAdam served in numerous positions of responsibility, including President and Chief Operating Officer of Verizon Communications Inc., President and CEO of Verizon Wireless, and Executive Vice President and Chief Operating Officer of Verizon Wireless. Before Verizon Wireless was formed, Mr. McAdam held executive positions with PrimeCo Personal Communications, AirTouch Communications and Pacific Bell. Mr. McAdam spent six years in the U.S. Navy Civil Engineer Corps and became a licensed professional engineer in 1979. In the past five years, Mr. McAdam has served as a director of General Electric Company. Qualifications: Mr. McAdam provides the Board with substantial and wide-ranging expertise in the telecommunications industry as well as a deep focus on innovation developed during his pivotal role in the formation and growth of Verizon Wireless. As CEO of Verizon Communications Inc., he provides the Board with in-depth knowledge of Verizon’s business, industry, challenges and opportunities. |

  13. Nominees for election

    | Verizon 2018 Proxy Statement | | 9 |

  14. Nominees for election

    | Director since 2006 Age 61 Independent Committees | Clarence Otis, Jr. Mr. Otis is the former Chairman and Chief Executive Officer of Darden Restaurants, Inc., the largest company-owned and operated full–service restaurant company in the world. He served as CEO of Darden Restaurants from 2004 to 2014 and as Chairman from 2005 to 2014. After joining Darden in 1995 as Vice President and Treasurer, Mr. Otis served in a number of positions of responsibility, including Chief Financial Officer, Executive Vice President, and President of Smokey Bones Barbeque & Grill, a restaurant concept formerly owned and operated by Darden. Mr. Otis also served as a director of the Federal Reserve Bank of Atlanta from 2010 to 2015. He has served as a director of The Travelers Companies, Inc. since August 2017 and VF Corporation since 2004. He has also been a director of 138 funds within the MFS Mutual Funds complex since March 2017. Qualifications: Mr. Otis provides the Board with valuable insight into consumer services, retail operations and financial oversight. His experience over his 20 years at Darden Restaurants provides him with critical perspectives on operations, strategy and management of a complex organization and a large-scale workforce, and his board service at the Federal Reserve Bank of Atlanta provides extensive risk management expertise. |

  15. Nominees for election

    | Director since 2010 Age 63 Independent Committees | Rodney E. Slater Mr. Slater has been a Partner at the law firm Squire Patton Boggs LLP since 2001 practicing in the areas of transportation, infrastructure and public policy. Previously, Mr. Slater served as the U.S. Secretary of Transportation from 1997 to 2001, and as the Administrator of the Federal Highway Administration from 1993 to 1997. Mr. Slater has served as a director of Kansas City Southern since 2001 and Transurban Group since 2009. In the past five years, Mr. Slater has also served as a director of Atkins plc. Qualifications: Mr. Slater has substantial regulatory and public policy experience at the federal and state levels. Mr. Slater provides the Board with valuable insights on public policy issues and leadership on matters involving multiple stakeholders. He also provides the Board with perspectives on strategic partnerships and legal issues. |

  16. Nominees for election

    | 10 | | Verizon 2018 Proxy Statement |

  17. Nominees for election

    | Director since 2012 Age 55 Independent Committees | Kathryn A. Tesija Ms. Tesija is the former Executive Vice President and Chief Merchandising and Supply Chain Officer of Target Corporation, the second largest discount retailer in the United States. She served in this role from 2008 to 2015. During her tenure at Target beginning in 1986, Ms. Tesija served in numerous positions of responsibility, including Director, Merchandise Planning, Senior Vice President, Hardlines Merchandising, and Strategic Advisor. Ms. Tesija has served on the board of Woolworths Group Limited since 2016. Qualifications: Ms. Tesija provides the Board with valuable large-scale global merchandising and supply chain experience, as well as operational perspectives and strategic planning expertise. Her tenure as an executive at Target Corporation provides the Board with additional insights into the retail industry and consumer behavior. |

  18. Nominees for election

    | Director since 2013 Age 59 Independent Committees | Gregory D. Wasson Mr. Wasson is the former President and Chief Executive Officer of Walgreens Boots Alliance, Inc., the first global pharmacy-led health and wellbeing enterprise. From 2009 through 2015 he was Director, President and Chief Executive Officer of Walgreen Co. A registered pharmacist, he joined Walgreen Co. in 1980 and served in a number of positions of responsibility, including President and Chief Operating Officer. Mr. Wasson has served on the board of The PNC Financial Services Group, Inc. since 2015 and, in the past five years, he has served on the boards of Walgreen Co. and AmerisourceBergen Corporation. Qualifications: Mr. Wasson provides the Board with valuable global operational and management experience, as well as extensive knowledge of the retail and healthcare industries. His tenure as CEO of a large publicly-held company provides the Board with additional in-depth perspective in organizational management. |

  19. Nominees for election

    | Verizon 2018 Proxy Statement | | 11 |

  20. Nominees for election

    | Director since 2015 Age 66 Independent Committee | Gregory G. Weaver Mr. Weaver was Chairman and Chief Executive Officer of Deloitte’s audit and enterprise risk services firm, Deloitte & Touche LLP, from 2012 to 2014 and from 2001 to 2005. From 2006 to 2012, he served on the board of directors of Deloitte’s U.S. organization and on its Governance, Compensation and Succession Committees. During Mr. Weaver’s 40 years of experience at Deloitte, including 30 years as a partner, he served as lead client service partner, audit partner and advisory partner for several of Deloitte & Touche’s largest clients. Mr. Weaver has served on the board of trustees of the Goldman Sachs Trust since 2015. Qualifications: Mr. Weaver provides the Board with significant expertise in the areas of public accounting, risk management and related regulatory matters, which he developed over a long career with a leading audit firm. He also brings to the Board valuable experience with the operational and governance issues faced by a large, complex organization like Verizon. |

  21. Nominees for election

    | 12 | | Verizon 2018 Proxy Statement |

  22. Director Compensation

    Director Compensation In 2017, each non-employee Director of Verizon received an annual cash retainer of $125,000. The Chairs of the Corporate Governance and Policy Committee and the Finance Committee received an additional annual cash retainer of $15,000, and the Chairs of the Audit Committee and the Human Resources Committee, as well as the Lead Director, each received an additional annual cash retainer of $25,000. In 2017, each non-employee Director also received a grant of Verizon share equivalents valued at $175,000 on the grant date. No meeting fees were paid if a non-employee Director attended a Board or Committee meeting on the day before or the day of a regularly scheduled Board meeting. Each non-employee Director who attended a Board or Committee meeting held on any other date received a meeting fee of $2,000. Each non-employee Director who joins our Board receives a one-time grant of 3,000 Verizon share equivalents valued at the closing price on the date the new Director joins our Board. All share equivalents that non-employee Directors receive are automatically credited to the Director’s deferred compensation account under the Verizon Executive Deferral Plan and invested in a hypothetical Verizon stock fund. Share equivalents received in the one-time grant or the annual equity grant may not be sold while the Director serves on the Board. Amounts in a Director’s deferred compensation account are paid in a cash lump sum in the year following the year the Director leaves our Board. Non-employee Directors may choose to defer all or part of their annual cash retainer and meeting fees (if any) under the Verizon Executive Deferral Plan. A non-employee Director may elect to invest these amounts in a hypothetical cash account that earns a return rate equal to the long-term, high-grade corporate bond yield average as published by Moody’s Investor Services, or in the other hypothetical investment options available to participants in Verizon’s Management Savings Plan. One of our non-employee Directors who served as a director of a predecessor company is a participant in a charitable giving program. Under this program, when a participant retires from the Board or attains age 65 (whichever occurs later) or dies, Verizon will make one or more charitable contributions in the aggregate amount of $1,000,000, payable in ten annual installments. This program, which is closed to future participants, is financed through the purchase of insurance on the life of each participant. In 2017, the aggregate cost of maintaining and administering this program for the participant was $15,000. The non-employee Directors are eligible to participate in the Verizon Foundation Matching Gifts Program. Under this program, which is open to all Verizon employees, the Foundation matches up to $5,000 per year of charitable contributions to accredited colleges and universities, $1,000 per year of charitable contributions to any non-profit with 501(c)(3) status, and $1,000 per year of charitable donations to designated disaster relief campaigns.

  23. Director Compensation

    | Verizon 2018 Proxy Statement | | 21 |

  24. Director Compensation

    Director Compensation | Director compensation in 2017

  25. Director compensation in 2017

    Director compensation in 2017

  26. Director compensation in 2017

    | Name (a) | Fees Earned or Paid in Cash(1) ($) (b) | Stock Awards(2) ($) (c) | Option Awards ($) (d) | Non-Equity Incentive Plan Compensation ($) (e) | Change in Pension Value and Nonqualified Deferred Compensation Earnings(3) ($) (f) | All Other Compensation(4) ($) (g) | Total ($) (h) | | Shellye Archambeau | 139,000 | 175,000 | 0 | 0 | 1,109 | 0 | 315,109 | | Mark Bertolini | 131,000 | 175,000 | 0 | 0 | 0 | 0 | 306,000 | | Richard Carrión* | 146,000 | 175,000 | 0 | 0 | 9,872 | 0 | 330,872 | | Melanie Healey | 131,000 | 175,000 | 0 | 0 | 0 | 5,000 | 311,000 | | M. Frances Keeth* | 179,000 | 175,000 | 0 | 0 | 0 | 0 | 354,000 | | Karl-Ludwig Kley | 133,000 | 175,000 | 0 | 0 | 1,355 | 0 | 309,355 | | Clarence Otis, Jr.* | 164,000 | 175,000 | 0 | 0 | 16,877 | 0 | 355,877 | | Rodney Slater | 131,000 | 175,000 | 0 | 0 | 0 | 0 | 306,000 | | Kathryn Tesija | 139,000 | 175,000 | 0 | 0 | 6,171 | 0 | 320,171 | | Gregory Wasson | 139,000 | 175,000 | 0 | 0 | 0 | 0 | 314,000 | | Gregory Weaver* | 164,000 | 175,000 | 0 | 0 | 725 | 0 | 339,725 |

  27. Director compensation in 2017

    | Denotes a chair of a standing committee during 2017. Ms. Keeth also served as Lead Director during 2017.* |

  28. Director compensation in 2017

    | 1 | This column includes all fees earned in 2017, whether the fee was paid in 2017 or deferred. |

  29. Director compensation in 2017

    | 2 | For each non-employee Director, this column reflects the grant date fair value of the non-employee Director’s 2017 annual stock award computed in accordance with FASB ASC Topic 718. The following reflects the aggregate number of share equivalent awards outstanding as of December 31, 2017 for each person who served as a non-employee Director during 2017: Shellye Archambeau, 17,976; Mark Bertolini, 13,406; Richard Carrión, 122,566; Melanie Healey, 27,285; M. Frances Keeth, 60,172; Karl-Ludwig Kley, 10,651; Clarence Otis, Jr., 68,090; Rodney Slater, 38,239; Kathryn Tesija, 22,049; Gregory Wasson, 21,094; and Gregory Weaver, 11,311. |

  30. Director compensation in 2017

    | 3 | This column reflects “above-market” earnings on nonqualified deferred compensation plans. The “above-market” earnings consist of earnings on amounts that the individual has elected to invest in a hypothetical investment option offered to all participants under the nonqualified deferred compensation plans that earns a return rate equal to the long-term, high-grade corporate bond yield average as published by Moody’s Investors Services. The earnings are considered “above-market” under SEC rules because the interest crediting rate for this investment option (which for 2017 was approximately 4.135%) exceeded 120% of the applicable federal long-term rate established by the Internal Revenue Service (which for 2017 was 3.075%). Non-employee Directors do not participate in any defined benefit pension plan. |

  31. Director compensation in 2017

    | 4 | This column reflects matching contributions made on the non-employee Directors’ behalf under the Verizon Foundation Matching Gift Program. |

  32. Director compensation in 2017

    | 22 | | Verizon 2018 Proxy Statement |

  33. Independent compensation consultant

    Independent compensation consultant The Committee has the sole authority to retain and terminate a compensation consultant and to approve all terms of the engagement, including fees. The Committee has retained Pearl Meyer as its compensation consultant (Consultant) based on the firm’s independence and expertise in representing the compensation committees of large corporations. The Consultant advises the Committee on all matters related to the compensation of our named executive officers and our non-employee Directors. This includes providing benchmarking data and helping the Committee interpret this data, as well as helping the Committee interpret data gathered by the Company. The Consultant participates in all Committee meetings and confers regularly with the Committee in executive session at those meetings. Committee policy prohibits the Consultant from doing any work for the Company during its engagement. Neither Pearl Meyer nor its affiliates have performed any work for the Company or any Company affiliate since the Committee first retained the Consultant in 2006. The Committee has considered the independence of Pearl Meyer in light of SEC rules and NYSE and Nasdaq listing standards. At the Committee’s request, Pearl Meyer provided a letter addressing its independence, including the following factors:

  34. Independent compensation consultant

    | • | No other services provided to the Company by the Consultant; |

  35. Independent compensation consultant

    | • | Fees paid by the Committee as a percentage of the Consultant’s total revenue; |

  36. Independent compensation consultant

    | • | Any business or personal relationships between the individual consultants involved in the engagement and a member of the Committee; |

  37. Independent compensation consultant

    | • | Policies or procedures maintained by the Consultant that are designed to prevent a conflict of interest; |

  38. Independent compensation consultant

    | • | Any Company stock owned by the individual consultants involved in the engagement; and |

  39. Independent compensation consultant

    | • | Any business or personal relationships between our executive officers and the Consultant or the individual consultants involved in the engagement. |

  40. Independent compensation consultant

    The Committee has concluded that no conflict of interest exists that would prevent Pearl Meyer from serving as an independent consultant to the Committee.

  41. Independent compensation consultant

    | 28 | | Verizon 2018 Proxy Statement |

  42. Independent compensation consultant

    Compensation Discussion and Analysis | Shareholder feedback on compensation

  43. Shareholder feedback on compensation

    Shareholder feedback on compensation Our Board, the Committee and our management team value shareholder perspectives on our executive compensation program. As part of the Committee’s annual review of the program, it considers the outcome of Verizon’s annual shareholder advisory vote on executive compensation – the “say-on-pay.” At our Annual Meeting in May 2017, the compensation of our named executive officers was approved by approximately 93% of votes cast, demonstrating a high level of shareholder support for our compensation program and policies. Management and Directors engage with our institutional shareholders in meetings and calls throughout the year. Topics covered have included, among others, the Committee’s choice of performance measures for awards issued under our Short- and Long-Term Incentive Plans, the relationship between the performance measures and our long-term strategy, the payout terms of equity awards, compensation recoupment policies, shareholder proposals and SEC compensation disclosure initiatives. Based on the feedback we have received during our outreach meetings, the results of our 2017 say-on-pay vote, and the history of strong shareholder support in prior say-on-pay votes, the Committee believes our shareholders continue to strongly support Verizon’s executive compensation program.

  44. Peer group

    Peer group The Committee uses the same peer group to benchmark executive pay opportunities and to evaluate Verizon’s relative stock performance under the Long-Term Plan. This peer group, which we call the Related Dow Peers, includes the 29 companies (other than Verizon) in the Dow Jones Industrial Average, plus Verizon’s five largest industry competitors that are not included in the Dow Jones Industrial Average. This group of companies is appropriate for the dual purpose of benchmarking executive pay opportunities and evaluating relative stock performance under the Long-Term Plan because many of the companies included in the group are similar to us in market capitalization, net income, revenue and total employees, and otherwise are our five largest industry competitors. This group also includes other companies we compete against in the marketplace, such as Apple, Disney and Microsoft. These companies represent Verizon’s primary competitors for executive talent and investor dollars. Moreover, this peer group is self-adjusting so that changes in the companies included in the Dow Jones Industrial Average are also reflected in the Related Dow Peers over time. For these reasons, the Committee believes that use of the Related Dow Peers provides a consistent measure of Verizon’s performance and makes it easier for shareholders to understand, evaluate and monitor Verizon’s compensation program.

  45. Peer group

    | Verizon 2018 Proxy Statement | | 29 |

  46. Peer group

    Compensation Discussion and Analysis | Peer group

  47. Benchmarking total compensation opportunity

    Benchmarking total compensation opportunity The Committee evaluates whether the compensation opportunities for our executives are appropriate and competitive by comparing each named executive officer’s total compensation opportunity – which represents the sum of the executive’s base salary and target award amounts under the Short-Term Incentive Plan (Short-Term Plan) and the Long-Term Plan – to the total compensation opportunities for executives in comparable positions at peer companies. The Committee references the 50th percentile of the Related Dow Peers when making this comparison. A named executive officer’s total compensation opportunity may be higher or lower depending upon the executive’s tenure and overall level of responsibility. The total amount of compensation an executive actually receives may be less or more than the targeted opportunity based on Verizon’s annual and long-term performance results.

  48. Elements of compensation

    | Pay element | Characteristics | Rationale | | Base salary | Annual fixed cash compensation | Attract and retain high-performing and experienced executives | | Short-term incentive opportunity | Annual variable cash compensation based on the achievement of predetermined annual performance measures | Motivate executives to achieve challenging short-term performance targets | | Long-term incentive opportunity | Long-term variable equity awards granted annually as a combination of PSUs and RSUs | Align executives’ interests with those of shareholders, encourage efforts to grow long-term value, and retain executives |

  49. Compensation mix to emphasize long-term performance

    Compensation mix to emphasize long-term performance The Committee believes that a substantial majority of each named executive officer’s total compensation opportunity should be variable and at risk in order to emphasize a performance-based culture. In establishing the mix of incentive pay for the named executive officers, the Committee balances the importance of meeting Verizon’s short-term business goals with the need to create shareholder value over the longer term. To that end, long-term target compensation opportunities are more

  50. Compensation mix to emphasize long-term performance

    | Verizon 2018 Proxy Statement | | 31 |

  51. Compensation mix to emphasize long-term performance

    Compensation Discussion and Analysis | Compensation objectives and elements of compensation than double the annual base salary and short-term incentive target compensation opportunities. Moreover, since the Long-Term Plan features three-year award cycles, with awards consisting of PSUs subject to both performance-based and time-based vesting requirements and RSUs subject to time-based vesting requirements, we reward sustained performance and also encourage high-performing executives to remain with Verizon. For 2017, the Committee allocated approximately 10% of each executive’s total compensation opportunity in the form of base salary, 20% in the form of short-term incentive, and 70% in the form of long-term incentive. The following chart illustrates the approximate allocation of the named executive officers’ 2017 total compensation opportunity between variable, performance-based elements and fixed pay.

  52. Performance target setting

    | • | Verizon’s short- and long-term strategy; |

  53. Performance target setting

    | • | Financial analysts’ consensus estimates for the performance measures over future performance cycles; |

  54. Performance target setting

    | • | The correlation among the performance measures and considerations of how Verizon’s operational performance will affect each measure differently; and |

  55. Performance target setting

    | • | With regard to the diversity and sustainability metric in the Short-Term Plan, Verizon’s values and long-term commitment to being a responsible member of the communities we serve. |

  56. 2017 short-term incentive compensation

    2017 short-term incentive compensation The Verizon Short-Term Plan motivates executives to achieve challenging short-term performance targets. Each year, the Committee establishes the potential value of the awards under the Short-Term Plan, as well as the performance targets required to achieve these awards. The Committee sets the values of the Short-Term Plan award opportunities as a percentage of an executive’s base salary based on both the scope of the executive’s responsibilities and the competitive pay practices of the Related Dow Peers. The Short-Term Plan award opportunities at the threshold, target and maximum levels for each of the named executive officers are shown in the “Grants of plan-based awards” table on page 48. For the named executive officers, target award opportunities, expressed as a percentage of base salary, did not change for 2017. However, the dollar value of the 2017 target award opportunities for Mr. Ellis, Mr. Stratton and Ms. Walden increased from 2016 as a result of the base salary increases described above. Mr. McAdam did not receive a salary increase in 2017, so the dollar value of his 2017 target award opportunity was the same as it was in 2015 and 2016. When Mr. Vestberg was hired in April 2017, he was eligible for a full year Short-Term Plan award for 2017, and his target award opportunity was set at 150% of his base salary, which is consistent with target award opportunities as a percentage of base salary that apply to the named executive officers other than Mr. McAdam. The following table shows the 2017 Short-Term Plan target award opportunity for each of the named executive officers.

  57. 2017 Short-Term Plan target award opportunity

    2017 Short-Term Plan target award opportunity

  58. 2017 Short-Term Plan target award opportunity

    | Named executive officer | As a percentage of base salary | As a dollar value | | Mr. McAdam | 250% | $4,000,000 | | Mr. Ellis | 150% | $1,125,000 | | Mr. Stratton | 150% | $1,425,000 | | Mr. Vestberg | 150% | $1,350,000* | | Ms. Walden | 150% | $1,425,000 |

  59. 2017 Short-Term Plan target award opportunity

    | For purposes of presenting Mr. Vestberg’s 2017 Short-Term Plan target award opportunity, his base salary was converted from SEK to USD using an exchange rate of 8.98 SEK = 1 USD, which was the SEK to USD exchange rate on February 24, 2017.* |

  60. Annual performance measures

    Annual performance measures In the first quarter of each year, the Committee establishes financial and operational performance measures for the Short-Term Plan that are consistent with Verizon’s strategic goals. For each such measure, the Committee sets a target that challenges executives to drive business results that generate shareholder value. Verizon’s performance with respect to these measures determines the amount of the short-term incentive awards earned by the named executive officers.

  61. Annual performance measures

    | Verizon 2018 Proxy Statement | | 33 |

  62. Annual performance measures

    | | Why these performance measures? The Committee selected adjusted EPS, free cash flow and total revenue to reflect Verizon’s strategic goals of encouraging profitable operations, efficient use of capital and overall growth. The Committee also selected a diversity and sustainability metric to reflect Verizon’s commitment to promoting diversity among our employees and our business partners, and to reducing the environmental impact of our operations. |

  63. Annual performance measures

    The 2017 performance measures, along with the weighting ascribed to each, are shown below as a percentage of the total Short-Term Plan award opportunity at target level performance.

  64. Annual performance measures

    | | The Committee believes that these performance measures are appropriate to motivate Verizon’s executives to achieve outstanding short-term results and, at the same time, help build long-term value for shareholders. The 2017 measures and related targets approved by the Committee are described in detail below. |

  65. Annual performance measures

    | | Adjusted EPS Target range: $3.78 to $3.87 Verizon’s earnings are a function of the revenue earned from customers and the expenses incurred to serve those customers. As a result, adjusted EPS is a measure of the efficiency with which we are approaching the marketplace – the effectiveness with which we are balancing encouraging customers to start and continue relationships with us and the costs we are incurring to do so. The Committee assigns the greatest weight to adjusted EPS in determining awards under the Short-Term Plan because this measure is broadly used and recognized by investors as a key indicator of ongoing operational performance and profitability. Adjusted EPS excludes special items, such as impairments and gains and losses from divestitures, business combinations, changes in accounting principles, the net impact of severance, pension and post-retirement benefit costs, extraordinary items and restructurings. As a result, the Committee believes this measure provides meaningful comparisons of our financial results from period to period and reflects the relative success of the ongoing business. | | | Free cash flow Target range: $11.5 billion to $12.9 billion Free cash flow is a measure of the cash we have left over after we have made the capital expenditures we need to make to continue to provide services to our customers. As a result, it is an indication of the extent to which we are efficiently using capital. It is also an indication of the amount of cash Verizon has available to return to shareholders in the form of dividends or share repurchases and to increase our financial flexibility by reducing outstanding debt. Free cash flow is calculated by subtracting capital expenditures from the total of cash flow from operations and cash flow from financing and investing activities attributable to device payment plan receivable securitizations. |

  66. Annual performance measures

    | 34 | | Verizon 2018 Proxy Statement |

  67. Annual performance measures

    | | Total revenue Target range: $123.8 billion to $125.2 billion The Committee views total revenue as an important indicator of Verizon’s growth and success in managing capital investments. This measure also reflects the extent to which we are able to attract and retain customers and the level of penetration of our products and services in key markets. In setting the total revenue target range for 2017, the Committee did not take into account certain revenues attributable to businesses that were acquired during the latter half of 2016 or expected to be acquired in 2017. | | | Diversity and sustainability Targets: At least 59.3% of U.S.-based workforce comprised of minority and female employees; direct at least $4.9 billion of our overall supplier spending to minority- and female-owned firms; reduce our carbon intensity by at least 4.0% compared to the prior year As a large, multinational company with a highly diverse customer and employee base, we know that our operations are strengthened when we leverage the diversity of thought and cultures of our workforce and suppliers. We are also committed to reducing the environmental impact of our operations because we believe that it is important for us to be good stewards of our planet while we continue to serve our customers. |

  68. Annual performance measures

    The Short-Term Plan provides for performance measures to be adjusted to exclude the impact of certain types of events not contemplated at the time the performance measures were set, such as significant transactions, changes in legal or regulatory policy and other special items. In determining free cash flow, the Committee made an adjustment for a discretionary pension prefunding contribution made in March 2017, set forth in Appendix A, which was not contemplated when the free cash flow target was set. No awards are paid under the Short-Term Plan if Verizon’s return on equity (ROE) for the plan year, based on adjusted net income, does not exceed 8% (even if some or all of the other performance measures are achieved).

  69. Annual performance measures

    | Verizon 2018 Proxy Statement | | 35 |

  70. Annual performance measures

    2017 Short-Term Plan award. After considering the level of performance with respect to each performance measure, and based on an assessment of the level of achievement of each goal individually and collectively, the Committee determines the final Short-Term Plan award as a percentage of the target level for all employees participating in the Short-Term Plan. For 2017, this payout percentage was determined to be 93% of the target level. The following table shows the amount of the Short-Term Plan award paid to each named executive officer.

  71. Annual performance measures

    | Named executive officer | Actual 2017 Short-Term Plan award ($) | | Mr. McAdam | 3,720,000 | | Mr. Ellis | 1,046,250 | | Mr. Stratton | 1,325,250 | | Mr. Vestberg* | 1,255,500 | | Ms. Walden | 1,325,250 |

  72. Annual performance measures

    | Mr. Vestberg relocated to the United States in January 2018; therefore, the 2017 STI award paid to Mr. Vestberg in February 2018 was paid in USD.* |

  73. Long-term incentive compensation

    Long-term incentive compensation The Verizon Long-Term Plan is intended to align executives’ and shareholders’ interests and to reward participants for creating long-term shareholder value. Consistent with past practice, Long-Term Plan awards are made in PSUs and RSUs. The value of each PSU or RSU is equal to the value of one share of Verizon common stock. The Committee establishes an executive’s Long-Term Plan award opportunity as a percentage of base salary and determines the number of PSUs and RSUs to be awarded based on the stock price on the grant date. The Committee assumes each executive will earn 100% of the PSUs and RSUs awarded for purposes of determining the total compensation opportunity. PSUs and RSUs accrue dividend equivalents that are deemed to be reinvested in PSUs and RSUs, respectively. These dividend equivalents are paid when, and only to the extent that, the related PSUs and RSUs are actually earned. In late 2016 and early 2017, the Committee, with the assistance of the Consultant, undertook a comprehensive review of the structure and mix of the annual equity compensation program. As part of that review, the Committee considered Verizon’s business strategy and focus, feedback the Company received from our shareholders through the shareholder outreach program and market data on competitive pay practices of the Related Dow Peers. In particular, the Committee noted that when granting time-based restricted stock units, a significant number of our peer companies utilize a ratable vesting schedule, with awards vesting in equal annual installments following the grant date, as opposed to a single, longer cliff vesting schedule. Based on this information, to align to market practices and enable us to continue to attract and retain key executive talent, the Committee determined that the RSUs granted to our executives in 2017 would vest ratably over three years, with one-third of the award vesting on each annual anniversary of the grant date. The Committee determined that PSUs would continue to be earned over a three-year performance cycle, with cliff vesting at the end of the three-year period. The Committee believes that a three-year performance cycle is appropriate for the PSU awards because a multi-year performance cycle enables the Committee to meaningfully evaluate the execution of long-term strategies and the effect on shareholder value.

  74. Long-term incentive compensation

    | 36 | | Verizon 2018 Proxy Statement |

  75. Long-term incentive compensation

    2017 adjusted Company results1 compared against target performance ranges resulting in a [XX]% payout ROE of XX.X%2 [$ icon] $X.XX Adjusted EPS $3.87 $3.78 $X.XX $XX.XB3 Free cash flow $12.9B $11.5B $XX.XB $XXX.XB Total revenue $125.2B $123.8B $XXX.XB 59.3% U.S.-based minority and female employees (XXX target performance) Over $4.9B of our overall supplier spending directed to minority- and female-owned firms (XXX target performance) 4.0% reduction in carbon intensity (XXX target performance) The number of PSUs actually earned and paid is determined based upon Verizon’s achievement of pre-established performance targets over the three-year performance cycle, and the ultimate value of each PSU is based on the closing price of Verizon’s common stock on the last trading day of the performance cycle. Because the value of PSUs is linked to both stock price and performance targets, PSUs provide a strong incentive to executives to deliver value to Verizon’s shareholders. RSUs also provide a performance link as the value of the award depends on Verizon’s stock price. Both PSUs and RSUs provide a retention incentive by requiring the executive to remain employed with Verizon through the end of the applicable vesting period, subject to certain qualifying separations. As in prior award cycles, the 2017 PSUs are payable in cash and the 2017 RSUs are payable in Verizon shares. The Committee believes this mix appropriately balances the potential shareholder dilution from paying awards in shares and cash flow considerations. In addition, paying the 2017 RSU awards in shares is consistent with Verizon’s policy of requiring a significant level of equity ownership by our named executive officers.

  76. 2017 Long-Term Plan award opportunities

    2017 Long-Term Plan award opportunities The Long-Term Plan award is intended to drive our executives to deliver superior TSR performance and create free cash flow, and to encourage retention among our highly-qualified team. To that end, consistent with past practice, each of the named executive officers received 60% of their 2017 Long-Term Plan award in the form of PSUs and 40% in the form of RSUs. Two-thirds of the PSUs are eligible to vest based on Verizon’s relative TSR, and one-third is eligible to vest based on Verizon’s cumulative free cash flow.

  77. 2017 Long-Term Plan award opportunities

    | | Why these performance measures? Relative TSR. The Committee understands that our investors have many different large-cap investment options. The Committee believes Verizon’s TSR compared to the TSR of the companies in the Related Dow Peers is a critical indicator of our success because it measures our performance in returning value to our shareholders in comparison to alternative investments our shareholders could have made. For this reason, the Committee chose relative TSR as the primary metric for determining the extent to which our management team will earn the PSUs granted under the Long-Term Plan. Free Cash Flow. As described above, the Committee views free cash flow as an important indicator of our success because it measures our ability to generate cash from operations, which may be reinvested in our business, used to make acquisitions or pay outstanding debt, or returned to shareholders in the form of dividends or through share repurchases. |

  78. 2017 Long-Term Plan award opportunities

    The 2017 target award opportunities for each of the named executive officers are shown in the table below. For the named executive officers other than Mr. Vestberg, target award opportunities, expressed as a percentage of base salary, did not change for 2017. The dollar value of the 2017 target award opportunities for Mr. Ellis, Mr. Stratton and Ms. Walden increased from 2016 solely as a result of the base salary increases described above. The dollar value of Mr. McAdam’s 2017 target award opportunity did not change from 2016 because he did not receive a base salary increase in 2017. When Mr. Vestberg was hired in April 2017, he was eligible for a full year Long-Term Plan award for 2017, and his target award opportunity was set at 500% of his base salary, which is consistent with the target award opportunities as a percentage of base salary that apply to Mr. Ellis and Ms. Walden.

  79. 2017 Long-Term Plan award opportunities

    | Verizon 2018 Proxy Statement | | 37 |

  80. 2017 Long-Term Plan award opportunities

    Long-term incentive program structure 60% PSUs 40% RSUs 2/3 Eligible to vest based on relative TSR 1/3 Eligible to vest based on Cumulative Free Cash Flow Eligible to vest based on continued employment through each applicable vesting date The Committee sets the award levels to provide a total compensation opportunity consistent with the Company’s overall compensation philosophy as described above, while maintaining a compensation mix in which each executive’s target annual Long-Term Plan award opportunity represents approximately 70% of that executive’s total compensation opportunity. The target award opportunity for an executive is allocated between PSUs and RSUs as noted above, and the target award opportunity allocated to each type of award is converted into a target number of units using the closing price of Verizon’s common stock on the grant date. The following table shows the target value of the 2017 Long-Term Plan awards granted to the named executive officers.

  81. 2017 Long-Term Plan target award opportunity

    2017 Long-Term Plan target award opportunity

  82. 2017 Long-Term Plan target award opportunity

    | Named executive officer | As a percentage of base salary | As a dollar value | | Mr. McAdam | 750% | $12,000,000 | | Mr. Ellis | 500% | $3,750,000 | | Mr. Stratton | 525% | $4,987,500 | | Mr. Vestberg | 500% | $4,500,000* | | Ms. Walden | 500% | $4,750,000 |

  83. 2017 Long-Term Plan target award opportunity

    | For purposes of presenting Mr. Vestberg’s 2017 Long-Term Plan target award opportunity, his base salary was converted from SEK to USD using an exchange rate of 8.98 SEK = 1 USD, which was the SEK to USD exchange rate on February 24, 2017.* |

  84. 2017 Long-Term Plan target award opportunity

    | 38 | | Verizon 2018 Proxy Statement |

  85. Terms of 2017 PSU awards

    Terms of 2017 PSU awards

  86. Total Shareholder Return metric

    Total Shareholder Return metric Two-thirds of the PSUs will vest based on relative TSR performance (TSR PSUs). The accompanying chart shows the percentage of the TSR PSUs awarded for the 2017-2019 performance cycle that will vest based on Verizon’s TSR position compared with the companies in the Related Dow Peers as constituted on the date the awards were granted. Verizon’s TSR during the performance cycle must rank at least 15th — the 59th percentile — among the Related Dow Peers for 100% of the target number of TSR PSUs to vest, meaning Verizon must achieve above median TSR PSU performance for target vesting. The maximum number of TSR PSUs (200% of target) will vest only if Verizon’s TSR during the three-year performance cycle ranks among the top four companies in the Related Dow Peers — the 91st percentile or higher. If Verizon’s TSR during the three-year performance cycle ranks below 25th — approximately the 29th percentile — of the companies in the Related Dow Peers, none of the TSR PSUs will vest.

  87. Free Cash Flow metric

    Free Cash Flow metric One-third of the PSUs will vest based on Verizon’s cumulative free cash flow (FCF PSUs). The percentage of the FCF PSUs awarded for the 2017-2019 performance cycle that will vest is based on the extent to which Verizon’s cumulative FCF over the performance cycle meets or exceeds the cumulative FCF performance levels set by the Committee at the beginning of the performance cycle. FCF is calculated by subtracting capital expenditures from the total of cash flow from operations and cash flow from financing and investing activities attributable to device payment plan receivable securitizations, and is subject to adjustment to eliminate the financial impact of significant transactions, changes in legal or regulatory policy and other extraordinary items, such as the 2017 Tax Cuts and Jobs Act enactment. The cumulative FCF target for the 2017-2019 performance cycle was set at a level reflective of our three-year strategic plan, which the Committee believes is attainable, but challenging in light of the business environment. The number of FCF PSUs that will vest ranges from 0%, if actual performance is below the threshold level, to 200%, if actual performance is at or above the maximum cumulative FCF level. The number of FCF PSUs that will vest in between identified performance levels will be determined by linear interpolation between vesting percentage levels.

  88. TSR PSU vesting by

    TSR PSU vesting by

  89. performance level

    | Verizon’s TSR rank among Related Dow Peers | Percent of TSR PSUs that vest | | | 1 | 200% | | | 2 | 200% | | | 3 | 200% | | | 4 | 200% | | | 5 | 172% | | | 6 | 165% | | | 7 | 158% | | | 8 | 151% | | | 9 | 144% | | | 10 | 137% | | | 11 | 130% | | | 12 | 123% | | | 13 | 116% | | | 14 | 109% | | | 15 | 102% | | | 16 | 95% | | | 17 | 88% | | | 18 (median) | 81% | | | 19 | 74% | | | 20 | 67% | | | 21 | 60% | | | 22 | 53% | | | 23 | 46% | | | 24 | 39% | | | 25 | 32% | | | 26 | 0% | | | 27 | 0% | | | 28 | 0% | | | 29 | 0% | | | 30 | 0% | | | 31 | 0% | | | 32 | 0% | | | 33 | 0% | | | 34 | 0% | | | 35 | 0% | |

  90. 2015 PSU awards earned in 2017

    2015 PSU awards earned in 2017 With respect to the PSUs awarded in 2015, the Committee determined the number of PSUs that vested for a participant based on the level of achievement of the two performance metrics over the three-year performance cycle: 2015-2017 TSR PSUs. Two-thirds of the PSUs awarded were eligible to vest based on Verizon’s TSR ranking for the 2015-2017 performance cycle relative to the Related Dow Peers as constituted on the date the award was granted. The percentage of TSR PSUs awarded for the 2015-2017 performance cycle that would vest at each level of Verizon’s relative TSR positioning was identical to the percentage at each performance level for the 2017-2019 grant shown on the prior page. Over the three-year performance cycle ending December 31, 2017, Verizon’s TSR ranked 26th among the Related Dow Peers, resulting in a vesting percentage of 0% for the TSR PSUs. 2015-2017 FCF PSUs. One-third of the PSUs awarded was eligible to vest based on Verizon’s cumulative free cash flow over the 2015-2017 performance cycle compared to the performance targets set by the Committee at the beginning of the three-year cycle. The following shows the percentage of FCF PSUs awarded that would vest based on Verizon’s cumulative free cash flow over the 2015-2017 performance cycle at different performance levels.

  91. 2015 PSU awards earned in 2017

    | Verizon’s cumulative free cash flow (in billions) | Percentage of awarded FCF PSUs that vest(1) | | Greater than $44.0 | 200% | | $41.0 | 150% | | $38.0 | 100% | | $32.0 | 50% | | Less than $32.0 | 0% |

  92. 2015 PSU awards earned in 2017

    | 1 | For achievement between the stated levels, vesting is determined by linear interpolation. |

  93. 2015 PSU awards earned in 2017

    At the time the 2015-2017 award was granted, the Committee provided for free cash flow to be determined on an adjusted basis, reflecting reductions and/or increases, to preserve the intended incentives by excluding the impact of certain types of events not contemplated by our financial plan, such as significant transactions, changes in legal or regulatory policy and other special items. In determining Verizon’s free cash flow over the performance cycle, the Committee included the cash flow from financing and investing activities attributable to device payment plan securitizations in the calculation of free cash flow, and made an adjustment for a discretionary pension prefunding contribution made in March 2017, which was not contemplated when the FCF PSU targets were set. This adjustment is set forth in Appendix A. In accordance with this pre-established adjustment methodology, the Committee determined that Verizon’s cumulative free cash flow over the performance cycle was $46.7 billion, which resulted in a vesting percentage of 200% for the FCF PSUs. 2015-2017 PSU payout. Based on the results described above, in the first quarter of 2018 the Committee approved a payment to all participants in the Long-Term Plan, including the named executive officers, of 67% of the PSUs awarded for the 2015-2017 performance cycle, which represents the weighted average of the two vesting percentages described above, plus dividend equivalents credited on those vested PSUs.

  94. Additional compensation actions in 2017

    Additional compensation actions in 2017 Hiring of Mr. Vestberg as Executive Vice President, President — Global Networks and Chief Technology Officer. To strengthen Verizon’s leadership position in next generation technology, and as part of our succession planning process, on April 3, 2017 Verizon hired Mr. Vestberg to lead Verizon’s Network and Technology team. The Committee believes that Mr. Vestberg is uniquely qualified and brings a set of skills and experiences that are ideally suited to further develop the architecture for Verizon’s fiber-centric networks and to position the Company for long-term growth. The Committee approved a compensation package for Mr. Vestberg that is competitive with industry practice, and includes a one-time RSU award and signing bonus. The one-time RSU award was granted to Mr. Vestberg on May 4, 2017, with a grant date value of approximately $3 million. The RSUs will vest after the completion of a three-year award period ending on May 4, 2020, provided that Mr. Vestberg remains employed throughout the award period. The RSU award, including accrued dividends, will be settled in shares of Verizon common stock, and Mr. Vestberg will be required to hold any such shares (net of withholding taxes) for at least two years following the vesting date unless he dies or becomes disabled. The one-time RSU

  95. Additional compensation actions in 2017

    award further enhances his immediate financial stake in Verizon, and the long-term vesting schedule also serves as a retention mechanism. In addition, Mr. Vestberg received a $1 million signing bonus that became payable upon his relocation to the United States from Sweden in January 2018. Mr. Vestberg is required to repay the signing bonus if he voluntarily leaves Verizon or is terminated for cause at any time prior to the one year anniversary of the date he relocated to the United States. One-time PSU award for Mr. Stratton. As the leader of Verizon’s global operations, Mr. Stratton is responsible for managing and growing Verizon’s established businesses, including the Company’s wireless and wireline consumer and B2B units: Verizon Wireless, Verizon Enterprise Solutions, Verizon Partner Solutions, Verizon Consumer Markets and Verizon Business Markets. These businesses generate approximately $120 billion in annual revenue and serve more than 120 million customers. As part of the succession planning process, in March 2017 the Committee considered Mr. Stratton’s critical role in the Company’s success, the fact that he is retirement eligible, and the competition for executive talent in our industry, and determined that it was appropriate to provide him with a one-time PSU award for retention and succession planning purposes. The one-time PSU award is 100% performance-based, and the amount Mr. Stratton will ultimately receive is predicated on driving ROE over the multi-year performance period. The Committee chose ROE as the performance measure for this one-time award because it is a strong indicator of the extent to which the Company is able to generate profit with the money our shareholders have invested in the Company and provides a significant link to shareholder value creation. ROE is not utilized as a performance measure under either the Short-Term or Long-Term Plan. The award was granted to Mr. Stratton on March 14, 2017, with a grant date fair value of approximately $6 million. In determining the value of the award, the Committee considered the factors above and noted that while a one-time award such as this is substantial in the first year, the Committee believes the proper way to consider the award is as compensation for, and apportioned over, the three-year award period plus the one-year period during which Mr. Stratton will be required to hold the shares he receives on vesting. The PSUs represent shares of Verizon stock that may become payable after the completion of a three-year award period ending on March 13, 2020, provided that the pre-established performance criterion is achieved and Mr. Stratton remains employed throughout the award period. The percentage of PSUs granted that will vest at the end of the three-year award period will be determined based on Verizon’s average annual ROE during the three-year period beginning January 1, 2017 and ending December 31, 2019. No PSUs will vest unless Verizon’s three-year average ROE meets a minimum threshold percentage of 30%. If Verizon’s three-year average ROE meets the target percentage of 45%, 100% of the PSUs granted will vest. If Verizon’s three-year average ROE is at least 60%, a maximum of 150% of the PSUs granted will vest. If Verizon’s three-year average ROE is greater than 30% but less than 45%, the percentage of PSUs that will vest will be between 50% and 100% on an interpolated basis, and if Verizon’s three-year average ROE is greater than 45% but less than 60%, the percentage of PSUs that will vest will be between 100% and 150% on an interpolated basis. The PSUs that vest at the end of the three-year award period ending March 13, 2020, including accrued dividends on the vested portion of the grant, will be settled in shares of Verizon stock. The award agreement requires Mr. Stratton to hold such shares (net of withholding taxes) for at least one year following the vesting date unless he dies or becomes disabled.

  96. Retirement benefits

    Retirement benefits Over ten years ago, the Committee determined that guaranteed pay in the form of defined benefit pension and supplemental executive retirement benefits was not consistent with Verizon’s pay-for-performance culture. Accordingly, effective June 30, 2006, Verizon froze all future pension accruals under its management tax-qualified and supplemental defined benefit retirement plans. These legacy retirement benefits that were previously provided to certain named executive officers are described in more detail under the section titled “Pension plans” beginning on page 50. In addition, effective June 30, 2006, the Committee froze eligibility for Verizon-subsidized retiree medical benefits under its legacy broad-based Wireline retiree medical plans, which provide a capped partial subsidy towards the cost of medical benefits to certain Verizon employees who met the eligibility requirements for the benefit. None of Verizon’s named executive officers are eligible for Verizon-subsidized retiree medical benefits. During 2017, all of Verizon’s named executive officers were eligible to participate in Verizon’s tax-qualified defined contribution savings plan, the Verizon Management Savings Plan, referred to as the Savings Plan, and Verizon’s nonqualified defined contribution savings plan, the Verizon Executive Deferral Plan, referred to as the Deferral Plan. The named executive officers participate in these plans on the same terms as other participants in the plans. Under the Savings Plan, participants may defer “eligible pay,” which includes base salary and short-term incentive, up to certain compensation limits imposed by the Internal Revenue Code, and Verizon provides a matching contribution equal to 100% of the first 6% of eligible pay deferred. The Deferral Plan is designed to “restore” benefits that are limited or cut back under the Savings Plan due to the Internal Revenue Code limits. Accordingly, under the Deferral Plan a participant may elect to defer his or her base pay and short-term incentive that could not be deferred into the Savings Plan due to the Internal Revenue Code limits. Verizon provides the same matching contribution on these deferred amounts as the participant would have received if such amounts had been permitted to be deferred into the Savings Plan. Prior to 2018, the Deferral Plan also permitted participants to defer long-term incentive compensation, but these deferrals were not eligible for Company matching contributions. All participants in both the Savings Plan and the Deferral Plan are eligible for an additional discretionary profit-sharing contribution of up to 3% of eligible pay.

  97. Severance and change in control benefits

    Severance and change in control benefits The Committee believes that maintaining a competitive level of separation benefits is appropriate as part of an overall program designed to attract, retain and motivate the highest-quality management team. However, the Committee does not believe that named executive officers should be entitled to receive cash severance benefits merely because a change in control occurs. Therefore, the payment of cash severance benefits is triggered only by an actual or constructive termination of employment. Verizon was not a party to any employment agreement with any of the named executive officers in 2017. All senior managers (including all named executive officers except Mr. McAdam) are eligible to participate in the Verizon Senior Manager Severance Plan, which provides certain separation benefits to participants whose employment is involuntarily terminated without cause. Mr. McAdam is not eligible to participate in the Senior Manager Severance Plan and is not entitled to receive any cash severance benefits upon his separation from the Company. The Senior Manager Severance Plan is generally consistent with the terms and conditions of Verizon’s broad-based severance plan for management employees other than senior managers. Under the Senior Manager Severance Plan, if a participant has been involuntarily terminated without cause (or, in the case of a named executive officer, if the independent members of the Board determine that there has been a qualifying separation), the participant is eligible to receive a lump-sum cash separation payment equal to a multiple of his or her base salary plus target short-term incentive opportunity,

  98. Severance and change in control benefits

    | 42 | | Verizon 2018 Proxy Statement |

  99. Severance and change in control benefits

    Compensation Discussion and Analysis | Other elements of the compensation program along with continuing medical coverage for the applicable severance period. To the extent that a senior manager is eligible for severance benefits under any other arrangement, that person may not receive any duplicative benefits under the Senior Manager Severance Plan. The Senior Manager Severance Plan does not provide for any severance benefits based upon a change in control of the Company. Under the Senior Manager Severance Plan, each named executive officer (other than Mr. McAdam) is eligible to receive a cash separation payment equal to two times the sum of his or her base salary and target short-term incentive opportunity. To be eligible for any severance benefits, a participant must execute a release of claims against Verizon in the form satisfactory to Verizon and agree not to compete or interfere with any Verizon business for a period of one year after separation. In connection with her separation from service on February 28, 2018, Ms. Walden became entitled to separation benefits under the Senior Manager Severance Plan, which are described in more detail on page 57. Ms. Walden did not receive any enhanced benefits upon her separation of service. Consistent with the Committee’s belief that named executive officers should not receive cash severance benefits merely because a change in control occurs, the Long-Term Plan does not allow “single-trigger” accelerated vesting and payment of outstanding awards upon a change in control. Instead, the Long-Term Plan requires a “double trigger.” Specifically, if in the 12 months following a change in control a participant’s employment is terminated without cause, all of that participant’s then-unvested PSUs will fully vest at the target level performance, then-unvested RSUs will fully vest, and those PSUs and RSUs (including accrued dividend equivalents) will become payable on the regularly scheduled payment date after the end of the applicable award cycle.

  100. Shareholder approval of certain severance arrangements

    Shareholder approval of certain severance arrangements The Committee has a policy of seeking shareholder approval or ratification of any new employment or severance agreement with an executive officer that provides for a total cash value severance payment exceeding 2.99 times the sum of the executive’s base salary plus Short-Term Plan target opportunity. The policy defines severance pay broadly to include payments for any consulting services, payments to secure a non-compete agreement, payments to settle any litigation or claim, payments to offset tax liabilities, payments or benefits that are not generally available to similarly situated management employees and payments in excess of, or outside, the terms of a Verizon plan or policy.

  101. Summary compensation

    | Name and Principal Position (a) | Year (b) | Salary ($) (c) | Bonus ($) (d) | Stock Awards(1) ($) (e) | Option Awards ($) (f) | Non-Equity Incentive Plan Compensation(2) ($) (g) | Change in Pension Value and Nonqualified Deferred Compensation Earnings(3) ($) (h) | All Other Compensation(4) ($) (i) | Total ($) (j) | | Lowell McAdam | 2017 | 1,600,000 | 0 | 12,000,062 | 0 | 3,720,000 | 73,949 | 543,570 | 17,937,581 | | Chairman and Chief | 2016 | 1,600,000 | 0 | 12,000,077 | 0 | 3,200,000 | 233,155 | 641,347 | 17,674,579 | | Executive Officer | 2015 | 1,661,538 | 0 | 12,000,065 | 0 | 4,000,000 | 83,092 | 598,965 | 18,343,660 | | Matthew Ellis | 2017 | 742,308 | 0 | 3,750,088 | 0 | 1,046,250 | 2,998 | 107,724 | 5,649,368 | | Executive Vice President | 2016 | 488,462 | 0 | 1,708,468 | 0 | 410,000 | 1,291 | 89,138 | 2,697,359 | | and Chief Financial Officer | | | | | | | | | | | John Stratton | 2017 | 942,308 | 0 | 10,987,566 | 0 | 1,325,250 | 80,190 | 204,837 | 13,540,151 | | Executive Vice President | 2016 | 896,154 | 0 | 4,725,072 | 0 | 1,080,000 | 101,959 | 237,424 | 7,040,609 | | and President — Global Operations | 2015 | 894,231 | 0 | 4,593,828 | 0 | 1,312,500 | 52,841 | 203,910 | 7,057,310 | | Hans Vestberg(5) | 2017 | 807,497 | 0 | 7,500,069 | 0 | 1,255,500 | 0 | 254,353 | 9,817,419 | | Executive Vice President, | | | | | | | | | | | President — Global Networks and | | | | | | | | | | | Chief Technology Officer | | | | | | | | | | | Marni Walden | 2017 | 942,308 | 0 | 4,750,035 | 0 | 1,325,250 | 43,510 | 195,819 | 7,256,922 | | Executive Vice President and | 2016 | 896,154 | 0 | 4,500,061 | 0 | 1,080,000 | 55,034 | 216,340 | 6,747,589 | | President — Global Media | 2015 | 894,231 | 0 | 4,375,074 | 0 | 1,312,500 | 44,907 | 174,317 | 6,801,029 |

  102. Summary compensation

    | has elected to invest in a hypothetical investment option offered to all participants under the nonqualified deferred compensation plans that earns a return rate equal to the long-term, high-grade corporate bond yield average as published by Moody’s Investors Services. The earnings are considered “above-market” under SEC rules because the interest crediting rate for this investment option (which for 2017 was approximately 4.135%) exceeded 120% of the corresponding applicable federal long-term rate established by the Internal Revenue Service (which for 2017 was 3.075%). Verizon’s defined benefit plans were frozen as of June 30, 2006, and Verizon stopped all future benefit accruals under these plans as of that date. All accruals under the Verizon Wireless pension plan were frozen as of December 31, 2006. |

  103. Grants of plan-based awards

    Grants of plan-based awards

  104. Grants of plan-based awards

    | | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(2) | | | Estimated Future Payouts Under Equity Incentive Plan Awards(3) | | | All Other Stock Awards: Number of Shares of Stock or Units(4) (#) (i) | All Other Option Awards: Number of Securities Underlying Options (#) (j) | Exercise or Base Price of Option Awards ($/Sh) (k) | Grant Date Fair Value of Stock and Option Awards(5) ($) (l) | | Name (a) | Type of Award(1) | Grant Date (b) | Threshold ($) (c) | Target ($) (d) | Maximum ($) (e) | Threshold (#) (f) | Target (#) (g) | Maximum (#) (h) | | | | | | Mr. McAdam | STP | — | 2,000,000 | 4,000,000 | 6,000,000 | | | | | | | | | | PSU | 3/3/2017 | | | | 54,622 | 143,742 | 287,484 | | | | 7,200,037 | | | RSU | 3/3/2017 | | | | | | | 95,828 | | | 4,800,025 | | Mr. Ellis | STP | — | 562,500 | 1,125,000 | 1,687,500 | | | | | | | | | | PSU | 3/3/2017 | | | | 17,070 | 44,920 | 89,840 | | | | 2,250,043 | | | RSU | 3/3/2017 | | | | | | | 29,947 | | | 1,500,045 | | Mr. Stratton | STP | — | 712,500 | 1,425,000 | 2,137,500 | | | | | | | | | | PSU | 3/3/2017 | | | | 22,702 | 59,743 | 119,486 | | | | 2,992,527 | | | PSU | 3/14/2017 | | | | 60,778 | 121,556 | 182,334 | | | | 6,000,004 | | | RSU | 3/3/2017 | | | | | | | 39,829 | | | 1,995,035 | | Mr. Vestberg | STP | — | 675,000 | 1,350,000 | 2,025,000 | | | | | | | | | | PSU | 4/3/2017 | | | | 20,862 | 54,901 | 109,802 | | | | 2,700,031 | | | RSU | 4/3/2017 | | | | | | | 36,601 | | | 1,800,037 | | | RSU | 5/4/2017 | | | | | | | 65,388 | | | 3,000,001 | | Ms. Walden | STP | — | 712,500 | 1,425,000 | 2,137,500 | | | | | | | | | | PSU | 3/3/2017 | | | | 21,621 | 56,898 | 113,796 | | | | 2,850,021 | | | RSU | 3/3/2017 | | | | | | | 37,932 | | | 1,900,014 |

  105. Grants of plan-based awards

    | 1 | These awards are described in the Compensation Discussion and Analysis beginning on page 33. |

  106. Grants of plan-based awards

    | 2 | The actual amount awarded in 2017 was paid in February 2018 and is shown in column (g) of the “Summary compensation” table on page 46. |

  107. Grants of plan-based awards

    | 3 | These columns reflect the potential payout range of PSU awards granted in 2017 to our named executive officers, in accordance with the Company’s annual long-term incentive award program, as described beginning on page 36. At the conclusion of the three-year performance cycle, payouts can range from 0% to 200% of the target number of units awarded based on Verizon’s relative TSR position as compared with the Related Dow Peers and Verizon’s cumulative free cash flow over the three-year performance cycle as described in more detail beginning on page 39. PSUs and the applicable dividend equivalents are paid only and to the extent that the applicable performance criteria for the award are achieved at the end of the award cycle. When dividends are distributed to shareholders, dividend equivalents are credited on the PSU awards in an amount equal to the dollar amount of dividends on the total number of PSUs credited as of the dividend distribution date and divided by the fair market value of the Company’s common stock on that date. These columns also include a special PSU award granted to Mr. Stratton on March 14, 2017 with a payout range between 0% and 150%. With respect to the March 14, 2017 PSU grant to Mr. Stratton, the number of PSUs that vest at the end of the three-year award period ending March 13, 2020 will be determined based on Verizon’s average annual ROE during the three-year performance period beginning January 1, 2017 and ending December 31, 2019, and the final award will include dividend equivalents that accrue on the vested portion of the award. No PSUs will vest unless Verizon’s three-year average annual ROE meets the minimum threshold of 30%. If Verizon’s three-year average annual ROE meets the target percentage of 45%, 100% of the nominal number of PSUs granted will vest. If Verizon’s three-year average annual ROE is at least 60%, a maximum of 150% of the PSUs granted will vest. If Verizon’s three-year average annual ROE is greater than 30% but less than 45%, the percentage of PSUs that will vest will be between 50% and 100% on an interpolated basis, and if Verizon’s three-year average annual ROE is greater than 45% but less than 60%, the percentage of PSUs that will vest will be between 100% and 150% on an interpolated basis. |

  108. Grants of plan-based awards

    | 4 | This column reflects the RSU awards granted in 2017 to the named executive officers, including a special award granted to Mr. Vestberg in connection with his hiring, in accordance with the Company’s annual long-term incentive award program. When dividends are distributed to shareholders, dividend equivalents are credited on the RSU awards in an amount equal to the dollar amount of dividends on the total number of RSUs credited as of the dividend distribution date and divided by the fair market value of the Company’s common stock on that date. These dividend equivalents are only distributed to the award holder if and when the award vests. |

  109. Grants of plan-based awards

    | 5 | This column reflects the grant date fair value of each equity award computed in accordance with FASB ASC Topic 718 based on the closing price of Verizon’s common stock on the grant date. For PSUs, the grant date fair value has been determined based on the vesting of 100% of the nominal PSUs awarded, which is the performance threshold the Company believed was the most likely to be achieved under the grants. |

  110. Grants of plan-based awards

    | 48 | | Verizon 2018 Proxy Statement |

  111. Grants of plan-based awards

    Compensation Tables | Plan-based awards

  112. Outstanding equity awards at fiscal year-end

    Outstanding equity awards at fiscal year-end

  113. Outstanding equity awards at fiscal year-end

    | | Option Awards | | | | | Stock Awards | | | | | | Name (a) | Number of Securities Underlying Unexercised Options (#) Exercisable (b) | Number of Securities Underlying Unexercised Options (#) Unexercisable (c) | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) (d) | Option Exercise Price ($) (e) | Option Expiration Date (f) | Number of Shares or Units of Stock That Have Not Vested(1)(2)(4) (#) (g) | Market Value of Shares or Units of Stock That Have Not Vested1,2,4,5 ($) (h) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested(1)(3)(6) (#) (i) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested1,3,6,7 ($) (j) | Grant Date | | Mr. McAdam | 0 | 0 | 0 | 0 | 0 | 100,532 | 5,321,159 | 107,066 | 5,667,003 | 3/4/2016 | | | | | | | | 99,391 | 5,260,766 | 131,197 | 6,944,257 | 3/3/2017 | | Mr. Ellis | 0 | 0 | 0 | 0 | 0 | 11,310 | 598,638 | 12,046 | 637,595 | 3/4/2016 | | | | | | | | 3,157 | 167,100 | 3,362 | 177,951 | 11/1/2016 | | | | | | | | 31,061 | 1,644,059 | 41,000 | 2,170,130 | 3/3/2017 | | Mr. Stratton | 0 | 0 | 0 | 0 | 0 | 39,585 | 2,095,234 | 42,158 | 2,231,423 | 3/4/2016 | | | | | | | | 41,310 | 2,186,538 | 54,529 | 2,886,220 | 3/3/2017 | | | | | | | | 0 | 0 | 189,114 | 10,009,804 | 3/14/2017 | | Mr. Vestberg | 0 | 0 | 0 | 0 | 0 | 37,962 | 2,009,329 | 50,109 | 2,652,269 | 4/3/2017 | | | | | | | | 66,976 | 3,545,040 | 0 | 0 | 5/4/2017 | | Ms. Walden | 0 | 0 | 0 | 0 | 0 | 37,700 | 1,995,461 | 40,150 | 2,125,140 | 3/4/2016 | | | | | | | | 39,343 | 2,082,425 | 51,932 | 2,748,761 | 3/3/2017 |

  114. Outstanding equity awards at fiscal year-end

    | 1 | In 2016, Mr. Ellis received an incremental equity award in connection with his appointment as Chief Financial Officer in the form of PSUs and RSUs, which may become payable after the completion of the three-year period ending December 31, 2018, provided that Mr. Ellis remains continuously employed, subject to the terms of the award agreements. |

  115. Outstanding equity awards at fiscal year-end

    | 2 | In 2017, Mr. Vestberg received a special equity award in the form of RSUs which, subject to continued employment, may become payable on May 4, 2020. The RSU award, to the extent vested, will be settled in shares of Verizon common stock, and Mr. Vestberg will be required to hold any such shares for at least two years following the vesting date. |

  116. Outstanding equity awards at fiscal year-end

    | 3 | In 2017, Mr. Stratton received a special equity award in the form of PSUs which may become payable at the end of the three-year award period ending on March 13, 2020, subject to continued employment. The percentage of PSUs that will vest at the end of the three-year award period will be based on Verizon’s average annual ROE during the three-year performance period beginning on January 1, 2017 and ending December 31, 2019. The award, to the extent vested, will be settled in shares of Verizon common stock, and Mr. Stratton will be required to hold any such shares for at least one year following the vesting date. |

  117. Outstanding equity awards at fiscal year-end

    | 4 | The annual 2016 RSU awards, including Mr. Ellis’ incremental 2016 RSU award, vest on December 31, 2018. The annual 2017 RSU awards vest ratably over three years from the grant date with one-third vesting on March 3, 2018, March 3, 2019 and March 3, 2020. Mr. Vestberg’s annual 2017 RSU award vests ratably over three years from the grant date with one-third vesting on April 3, 2018, April 3, 2019 and April 3, 2020. Mr. Vestberg’s special 2017 RSU award vests on May 4, 2020. RSUs accrue quarterly dividends that are reinvested into the participant’s account as additional RSUs and will be included in the final RSU payment if the awards vest. This column includes dividend equivalent units that have accrued through December 31, 2017. |

  118. Outstanding equity awards at fiscal year-end

    | 5 | This column represents the value of the RSU awards listed in column (g) based on a share price of $52.93, the closing price of Verizon’s common stock on December 29, 2017. |

  119. Outstanding equity awards at fiscal year-end

    | 6 | The annual 2016 and 2017 PSU awards, including Mr. Ellis’ incremental 2016 PSU award, vest on December 31, 2018 and December 31, 2019 respectively. Mr. Stratton’s special 2017 PSU award vests on March 13, 2020, with the number of PSUs that will vest determined based on Verizon’s average annual ROE during the three-year performance cycle in accordance with the terms of the award agreement. PSUs accrue quarterly dividends that are reinvested into the participant’s account as additional PSUs. PSUs and the applicable dividend equivalents are paid if and to the extent that the applicable PSU award vests. As required by SEC rules, the number of units in this column represents the 2016 PSU awards at a 71% vesting percentage, the 2017 PSU awards at a 88% vesting percentage, and Mr. Stratton’s 2017 special PSU Award at a 150% vesting percentage, in each case including accrued dividend equivalents through December 31, 2017 that will be paid to the executives if the awards vest at the indicated levels. |

  120. Outstanding equity awards at fiscal year-end

    | 7 | This column represents the value of the PSU awards listed in column (i) based on a share price of $52.93, the closing price of Verizon’s common stock on December 29, 2017. |

  121. Option exercises and stock vested

    Option exercises and stock vested

  122. Option exercises and stock vested

    | | Option Awards | | Stock Awards | | | Name (a) | Number of Shares Acquired on Exercise (#) (b) | Value Realized on Exercise ($) (c) | Number of Shares Acquired on Vesting(1) (#) (d) | Value Realized on Vesting(1)(2)(3) ($) (e) | | Mr. McAdam | 0 | 0 | 228,801 | 12,110,443 | | Mr. Ellis | 0 | 0 | 34,040 | 1,751,939 | | Mr. Stratton | 0 | 0 | 87,589 | 4,636,082 | | Mr. Vestberg | 0 | 0 | 0 | 0 | | Ms. Walden | 0 | 0 | 83,418 | 4,415,317 |

  123. Option exercises and stock vested

    | 1 | The amounts include dividend equivalents that were credited on the PSU and RSU awards that vested on December 31, 2017 in accordance with the terms of the awards. For Mr. Ellis, the amount also includes dividend equivalents that were credited on the RSU award that vested on February 3, 2017, in accordance with the terms of the award. |

  124. Option exercises and stock vested

    | 2 | The amounts in this column represent the number of shares acquired on vesting multiplied by $52.93, the closing price of Verizon’s common stock on December 29, 2017. For Mr. Ellis the amount also includes the number of shares acquired on vesting of his special 2014 RSU award multiplied by $48.58, the closing price of Verizon’s common stock on February 3, 2017. |

  125. Option exercises and stock vested

    | 3 | The amounts in this column include $179,391 for Mr. Ellis that was deferred under the Verizon Executive Deferral Plan in 2018 when the amounts would have otherwise been paid. |

  126. Pension benefits

    Pension benefits

  127. Pension benefits

    | Name (a) | Plan Name (b) | Number of Years Credited Service(1) (#) (c) | Present Value of Accumulated Benefit(2) ($) (d) | Payments During Last Fiscal Year ($) (e) | | Mr. McAdam | Verizon Wireless Retirement Plan – Qualified Verizon Wireless Retirement Plan – Nonqualified | 34 10 | 1,068,915 1,604,642 | 0 0 | | Ms. Walden | Verizon Wireless Retirement Plan – Qualified | 17 | 27,619 | 0 |

  128. Pension benefits

    | 1 | The years of credited service for each of Mr. McAdam and Ms. Walden with respect to the applicable plan is less than the named executive officer’s number of actual years of service with the Company. For Mr. McAdam, the 10 years of credited service represents the period over which he earned a benefit in the nonqualified portion of the Verizon Wireless Pension Plan. Ms. Walden does not have a benefit in the nonqualified plan. |

  129. Pension benefits

    | 2 | The values are based on the assumptions for the actuarial determination of pension benefits as required by the relevant accounting standards as described in note 10 to the Company’s consolidated financial statements for the year ended December 31, 2017, as included in Verizon’s 2017 Annual Report. However, in accordance with the requirements for this table, the values are calculated using the executive’s retirement at the earliest age at which he or she can retire without having the retirement benefit reduced under the plan. |

  130. Nonqualified deferred compensation

    Nonqualified deferred compensation

  131. Nonqualified deferred compensation

    | Name (a) | | Executive Contributions in Last FY(1) ($) (b) | Registrant Contributions in Last FY(2) ($) (c) | Aggregate Earnings in Last FY(3) ($) (d) | Aggregate Withdrawals/ Distributions(4) ($) (e) | Aggregate Balance at Last FYE(4) ($) (f) | | Mr. McAdam | Verizon Executive Deferral Plan | 271,800 | 325,150 | 468,720 | 0 | 10,571,389 | | | Verizon Wireless Executive Savings Plan | 0 | 0 | 123,554 | 0 | 2,604,480 | | Mr. Ellis | Verizon Executive Deferral Plan | 236,354 | 58,998 | 23,681 | 0 | 544,195 | | Mr. Stratton | Verizon Executive Deferral Plan | 438,077 | 124,575 | 906,653 | 0 | 10,186,227 | | | Verizon Wireless Executive Savings Plan | 0 | 0 | 177,866 | 0 | 4,473,100 | | Ms. Walden | Verizon Executive Deferral Plan | 105,138 | 124,575 | 297,689 | 0 | 7,379,521 | | | Verizon Wireless Executive Savings Plan | 0 | 0 | 578 | 0 | 14,286 |

  132. Nonqualified deferred compensation

    | 1 | Of the amounts listed in this column, the following amounts are also included in the “Summary compensation” table in columns (c) and (j): for Mr. McAdam, $79,800; for Mr. Ellis, $28,338; for Mr. Stratton, $168,077; and for Ms. Walden, $40,338. |

  133. Nonqualified deferred compensation

    | 2 | The amounts listed in this column are also included in columns (i) and (j) of the “Summary compensation” table. |

  134. Nonqualified deferred compensation

    | 3 | Of the amounts listed in this column, the following amounts are also included in the “Summary compensation” table in columns (h) and (j): for Mr. McAdam, $73,949; for Mr. Ellis, $2,998; for Mr. Stratton, $80,190; and for Ms. Walden, $40,381. |

  135. Nonqualified deferred compensation

    | 4 | The aggregate amounts shown in columns (e) and (f) include the following amounts that were reported as compensation to the named executive officers in the “Summary compensation” table in Verizon’s previous proxy statements: |

  136. Nonqualified deferred compensation

    | • | For Mr. McAdam, a total of $5,470,490 was reported (2008 to 2017); |

  137. Nonqualified deferred compensation

    | • | For Mr. Ellis, a total of $83,928 was reported (2017); |

  138. Nonqualified deferred compensation

    | • | For Mr. Stratton, a total of $2,873,722 was reported (2013 to 2017); and |

  139. Nonqualified deferred compensation

    | • | For Ms. Walden, a total of $478,966 was reported (2016 to 2017). |

  140. Potential payments upon termination or change in control

    Potential payments upon termination or change in control The following summaries and tables describe and quantify the potential payments and benefits that would be provided to each of our named executive officers other than Ms. Walden if a termination of employment or change in control of Verizon had occurred at the end of 2017 under Verizon’s compensation plans and agreements. Ms. Walden left Verizon on February 28, 2018. The actual payments and benefits that Ms. Walden became entitled to receive in connection with her separation from Verizon are discussed under the heading “Separation of Ms. Walden” beginning on page 57.

  141. Potential payments upon termination or change in control

    | 52 | | Verizon 2018 Proxy Statement |

  142. Potential payments upon qualifying separation or involuntary termination without cause

    Potential payments upon qualifying separation or involuntary termination without cause Mr. McAdam. As Chairman and CEO, Mr. McAdam is not eligible to participate in the Senior Manager Severance Plan described below. Mr. McAdam is also not a party to an employment agreement with Verizon or any other agreement that would provide him with cash severance benefits in the event his employment is involuntarily terminated by Verizon without cause. Senior Manager Severance Plan. Verizon provides severance benefits to certain employees, including all of the named executive officers other than the Chairman and CEO, under the Senior Manager Severance Plan. Under the plan, a named executive officer is eligible to receive severance benefits if he or she experiences a “qualifying separation” from Verizon, which is generally defined as an involuntary termination by Verizon without cause, a voluntary termination by the executive solely due to the executive’s refusal to accept a qualifying reclassification or relocation (as those terms are defined in the plan) or a determination by the independent members of the Board that the named executive officer has incurred a qualifying separation. A severance benefit, if triggered, is payable to an executive only if the executive executes a release of claims against Verizon in the form satisfactory to Verizon and agrees not to compete or interfere with any Verizon business for a period of one year after termination from employment and always to protect Verizon’s trade secrets and proprietary information. If a named executive officer incurs a qualifying separation under the plan, he or she is eligible to receive the following benefits: (i) a lump-sum cash separation payment equal to two times the sum of his or her base salary and target Short-Term Plan award opportunity; and (ii) continued medical, dental and vision coverage for two years. In addition, if the executive’s qualifying separation occurs prior to the last day of the year, the executive will receive a prorated Short-Term Plan award for the year in which the separation occurs, determined based on the actual level of achievement of the performance criteria under the Short-Term Plan for the applicable year and payable at the time that awards are payable to participating employees generally under the plan. To the extent that an executive also becomes eligible for severance benefits under any outstanding agreement, plan or any other arrangement, the executive’s cash severance payment under the Senior Manager Severance Plan will be reduced on a dollar-for-dollar basis by the amount of the severance benefits payable to the executive under such other agreement, plan or arrangement. Ms. Walden left Verizon on February 28, 2018. Upon her separation, Ms. Walden was entitled to receive separation benefits under the Senior Manager Severance Plan, which are described and quantified under the heading “Separation of Ms. Walden” beginning on page 57. Ms. Walden did not receive any additional separation benefits or payments upon her separation of service.

  143. Potential payments upon qualifying separation or involuntary termination without cause

    | Verizon 2018 Proxy Statement | | 53 |

  144. Potential payments upon qualifying separation or involuntary termination without cause

    Other benefits. Upon an involuntary termination of employment without cause, a named executive officer would also be eligible to receive financial planning and outplacement services for one year following termination on the same basis as provided to other senior executives. However, executives would only be entitled to receive financial planning services if they participate in the program in the year in which their employment terminates. Mr. McAdam and Mr. Vestberg did not participate in the financial planning program in 2017 and, as a result, would not have been entitled to receive financial planning services if their employment had terminated on the last business day of 2017. In addition, under the terms of the executive life insurance plan, each named executive officer who is retirement eligible upon termination and who continues to pay the annual premiums on the life insurance policy owned by the executive would be eligible to receive an annual payment from Verizon to pay a portion of the annual premium until the latest of the executive’s attainment of age 60 or the completion of 5 years of plan participation. Retirement eligibility is generally defined as having attained 75 points (age plus years of service) with at least 15 years of service. If the named executive officer is not retirement eligible upon termination and has not reached plan maturity (age 60 and 5 years of plan participation) upon termination, the executive would be eligible to receive one additional annual payment to pay a portion of the annual premium for the two years following the year in which the executive’s termination occurs. Mr. McAdam attained plan maturity on December 31, 2014, and he is not entitled to receive any additional payments from Verizon with respect to this benefit following his termination of employment. In addition, Mr. Vestberg is eligible for a one month contribution to the ITP1 collectively agreed defined contribution plan. Estimated payments. The following table shows Verizon’s estimate of the amount of benefits the named executive officers, other than Ms. Walden, would have been entitled to receive had their employment been involuntarily terminated without cause on the last business day of 2017 or had incurred a qualifying separation under the Senior Manager Severance Plan. The actual payments and benefits that Ms. Walden became entitled to receive upon her separation from Verizon on February 28, 2018 are discussed under the heading “Separation of Ms. Walden” beginning on page 57.

  145. Potential payments upon qualifying separation or involuntary termination without cause

    | Name | Cash Separation Payment ($) | Continued Health Benefits(1) ($) | Outplacement Services ($) | Financial Planning(2)($) | Executive Life Insurance Benefit(3) ($) | Other(4) ($) | | Mr. McAdam | 0 | 0 | 0 | 0 | 0 | 0 | | Mr. Ellis | 3,750,000 | 43,667 | 14,500 | 11,000 | 20,053 | 0 | | Mr. Stratton | 4,750,000 | 29,112 | 14,500 | 13,000 | 153,666 | 0 | | Mr. Vestberg | 4,500,000 | 0 | 14,500 | 0 | 4 | 26,913 |

  146. Potential payments upon qualifying separation or involuntary termination without cause

    | 1 | The amounts reflect Verizon’s estimated cost of providing medical, dental and vision coverage for two years. Upon a termination of Mr. Vestberg’s employment, he would have been entitled to continued healthcare coverage under the Swedish Universal Healthcare system at no cost to the company. |

  147. Potential payments upon qualifying separation or involuntary termination without cause

    | 2 | Mr. McAdam and Mr. Vestberg did not participate in the financial planning program in 2017 and, as a result, would not have been entitled to receive financial planning services if their employment had terminated on the last business day of 2017. |

  148. Potential payments upon qualifying separation or involuntary termination without cause

    | 3 | If Mr. McAdam had retired on December 31, 2017, he would not have been entitled to receive additional company contributions with respect to this benefit because he reached plan maturity on December 31, 2014. The amount for Mr. Stratton represents the amount of total payments to pay a portion of the life insurance policy owned by him, provided that he continues to pay the annual premium pursuant to the terms of the program. The amount for Mr. Ellis, who is not retirement eligible, reflects one additional annual payment to pay a portion of the annual premium for the two years following the year in which his termination occurs. Mr. Vestberg did not participate in the program in 2017. However, the amount shown represents a one month required contribution to the TGL life insurance program, which is described in footnote 1 to the “Estimated Payments” table below under the heading “Potential payments upon death, disability or retirement.” The amounts were converted from SEK to USD in the above table using the December 29, 2017 USD to SEK exchange rate (8.20760 SEK = 1 USD). |

  149. Potential payments upon qualifying separation or involuntary termination without cause

    | 4 | For Mr. Vestberg, this column includes a one month contribution to the ITP1 collectively agreed defined contribution plan. The amounts were converted from SEK to USD in the above table using the December 29, 2017 USD to SEK exchange rate (8.20760 SEK = 1 USD). |

  150. Potential payments upon death, disability or retirement

    Potential payments upon death, disability or retirement Under the terms of the executive life insurance plan, in the event of disability or a qualifying retirement, a named executive officer who continues to pay the annual premiums on the life insurance policy owned by the executive would be eligible to receive an annual payment from Verizon to pay a portion of the annual premium until the latest of the executive’s attainment of age 60 or the completion of 5 years of plan participation. If the named executive officer dies, his or her beneficiary would be entitled to receive the proceeds of the life insurance policy owned by the executive, payable by the third-party issuer of the policy.

  151. Potential payments upon death, disability or retirement

    | 54 | | Verizon 2018 Proxy Statement |

  152. Potential payments upon death, disability or retirement

    Under the Short-Term Plan, if the named executive officer’s employment terminates due to death, disability or a qualifying retirement prior to the last day of the year, the executive would be eligible for a prorated Short-Term Plan award for the year in which the termination date occurred, determined based on the actual level of achievement of the performance criteria under the Short-Term Plan for the applicable year and payable at the time that awards are generally payable to participating employees under the plan. As described above, if the executive’s employment terminates on the last day of the year for any reason other than for cause, the full amount of the Short-Term Plan award, determined based on the actual level of achievement of the performance criteria under the Short-Term Plan for the applicable year, would have been payable. In addition, upon death, disability or a qualifying retirement, each named executive officer would also be eligible to receive financial planning services for one year following termination on the same basis as provided to other senior executives, provided that the executive participated in the program in the year in which his or her employment terminates. Upon disability, the named executive officers would also be eligible for disability benefits under the tax-qualified and nonqualified disability plans. Estimated payments. The following table shows Verizon’s estimate of the amount of benefits the named executive officers, other than Ms. Walden, would have been entitled to receive had their employment terminated due to death, disability or qualifying retirement on the last business day of 2017. The actual payments and benefits that Ms. Walden became entitled to receive upon her separation from Verizon on February 28, 2018 are discussed under the heading “Separation of Ms. Walden” beginning on page 57.

  153. Potential payments upon death, disability or retirement

    | Name | Executive Life Insurance Benefit(1) ($) | Disability Benefit(2) ($) | Financial Planning(3) ($) | | Mr. McAdam | | | | | Death | 3,200,000 | 0 | 0 | | Disability | 0 | 784,032 | 0 | | Retirement | 0 | 0 | 0 | | Mr. Ellis | | | | | Death | 3,008,000 | 0 | 11,000 | | Disability | 278,766 | 503,217 | 11,000 | | Retirement(4) | 0 | 0 | 0 | | Mr. Stratton | | | | | Death | 3,810,000 | 0 | 13,000 | | Disability | 153,666 | 374,229 | 13,000 | | Retirement | 153,666 | 0 | 13,000 | | Mr. Vestberg | | | | | Death | 51,903 | 0 | 0 | | Disability | 0 | 0 | 0 | | Retirement(4) | 0 | 0 | 0 |

  154. Potential payments upon death, disability or retirement

    | 1 | In the event of death, the amount represents the proceeds from the life insurance policy owned by the named executive officer, payable by the third-party issuer of the policy. In the event of disability or retirement, for the named executive officers other than Mr. Vestberg, the amount, if any, represents the total amount of annual payments to the named executive officer to pay a portion of the annual premium of the life insurance policy owned by him, provided that the named executive officer continues to pay the annual premiums pursuant to the terms of the executive life insurance program. The amount shown for Mr. Vestberg represents the company paid portion of the premium under the TGL life insurance plan, which is a collectively agreed group life insurance program for employees in Sweden that offers a basic benefit of 6 times the Price Base Amount (PBA) if under age 55. The benefit amount increases at older ages and there is a supplement payable for minor aged children. The PBA is an index established by the Swedish government that increases annually in line with wages. In 2017, the PBA was SEK 44,800. The amount shown for Mr. Vestberg was converted from SEK to USD in the above table using the December 29, 2017 USD to SEK exchange rate (8.20760 SEK = 1 USD). If Mr. McAdam had retired on December 31, 2017, he would not have been entitled to receive additional company contributions with respect to this benefit because he reached plan maturity on December 31, 2014. |

  155. Potential payments upon death, disability or retirement

    | Verizon 2018 Proxy Statement | | 55 |

  156. Potential payments upon death, disability or retirement

    | 2 | Assumes that each named executive officer, other than Mr. Vestberg, would be immediately eligible for long-term disability benefits from Verizon’s qualified and nonqualified disability benefit plans. Messrs. Ellis and Stratton do not participate in the nonqualified portion of the disability benefit. The assumptions used to calculate the value of the disability benefits include a discount rate of 3.80% and mortality and recovery based on the 2012 Group Long-Term Disability Valuation Table. These rates represent the probability of death or recovery between the date of disability and the payment end date. The qualified portion of the disability benefit for Mr. McAdam, Mr. Ellis and Mr. Stratton, is estimated at $285,429, $503,217, and $374,229, respectively, and the nonqualified portion of the disability benefit for Mr. McAdam is estimated at $498,602. In order to receive the nonqualified portion of the disability benefit, the executive must pay the premium associated with the qualified portion of the benefit. During 2017, Mr. Vestberg participated in a broad-based non-discriminatory long-term disability plan for Verizon employees located in Sweden on the same terms and conditions that apply to all other participants in that plan. |

  157. Potential payments upon death, disability or retirement

    | 3 | Mr. McAdam and Mr. Vestberg did not participate in the financial planning program in 2017 and, as a result, would not have been entitled to receive financial planning services if their employment had terminated on the last business day of 2017. |

  158. Potential payments upon death, disability or retirement

    | 4 | Mr. Ellis would not have been entitled to receive executive life insurance benefits or financial planning benefits because he had not fulfilled the eligibility requirements for retirement under the terms of those programs on the last business day of 2017. Mr. Vestberg would also not have been entitled to receive these benefits because he did not participate in those plans. |

  159. Potential payments upon change in control

    Potential payments upon change in control Verizon does not maintain any plans or arrangements that provide for any named executive officer to receive cash severance or any other cash payments in connection with a change in control of Verizon. If the named executive officer’s employment terminates in connection with or following a change in control, he or she would be eligible for the same benefits, if any, that would become payable to the executive upon his or her termination under the circumstances as described above. Under the Short-Term Plan, if a change in control occurs, all outstanding awards will vest and become payable on the regularly scheduled payment date.

  160. CEO pay ratio disclosure

    CEO pay ratio disclosure Pursuant to SEC rules, we are required to disclose in this proxy statement the ratio of the annual total compensation of Mr. McAdam, our Chairman and CEO, to the median of the annual total compensation of all of our employees (excluding Mr. McAdam). We determined that Mr. McAdam’s 2017 annual total compensation was $17,947,316, the median of the 2017 annual total compensation of all of our employees (excluding Mr. McAdam) was $126,623, and the ratio of these amounts was 142 to 1. To identify the “median employee” for purposes of this disclosure (i.e., the individual employee whose compensation was at the median level among our entire employee group), we used a determination date of October 1, 2017 and analyzed, for all of the individuals employed by us or any of our consolidated subsidiaries on that date, the compensation that we paid to each of those individuals for the 12-month period ending on that date. We considered each employee’s “compensation” to consist of (i) the employee’s total gross earnings for the 12-month period ending October 1, 2017, plus (ii) the estimated amount of Verizon’s contributions for that period to the retirement plans in which the employee participates, plus (iii) the estimated present value of the employee’s accrual under a Verizon pension plan (if any) for those who are still accruing service and whose benefits have not otherwise been frozen. The compensation for employees, other than temporary and seasonal employees, who were not employed by us for the entire 12-month period was annualized to reflect compensation for the entire 12-month period. For purposes of calculating the ratio above, the value of employer provided non-discriminatory health benefits was included in the compensation of each of Mr. McAdam and the median employee.

  161. CEO pay ratio disclosure

    | 58 | | Verizon 2018 Proxy Statement |

  162. Directors and executive officers

    Directors and executive officers The following table shows the number of shares of Verizon common stock beneficially owned by each of the named executive officers, each Director, and all executive officers and Directors as a group as of January 31, 2018. This information includes shares held in Verizon’s employee savings plans and shares that may be acquired within 60 days upon the conversion of certain stock units under deferred compensation plans and/or stock-based long-term incentive awards. The aggregate number of shares owned by executive officers and Directors represents less than one percent of the total number of outstanding shares of Verizon common stock. Unless we indicate otherwise, each individual has sole voting and/or investment power with respect to the shares. Executive officers and Directors also have interests in other stock-based units under Verizon deferred compensation plans and stock-based long-term incentive awards. We have included these interests in the “Total stock-based holdings” column in the table below to show the total economic interest that the executive officers and Directors have in Verizon common stock.

  163. Directors and executive officers

    | Name | Stock(1)(2) | Total stock-based holdings(3) | | Named Executive Officers | | | | Lowell McAdam* | 671,281 | 1,411,892 | | Matthew Ellis | 37,021 | 164,175 | | John Stratton | 137,114 | 567,588 | | Marni Walden | 81,170 | 322,428 | | Hans Vestberg | 0 | 161,935 | | Directors | | | | Shellye Archambeau | 0 | 17,976 | | Mark Bertolini | 0 | 13,406 | | Richard Carrión | 5,162 | 123,896 | | Melanie Healey | 0 | 27,285 | | M. Frances Keeth | 0 | 60,172 | | Karl-Ludwig Kley | 0 | 10,651 | | Clarence Otis, Jr. | 3,000 | 71,090 | | Rodney Slater | 0 | 38,239 | | Kathryn Tesija | 0 | 22,049 | | Gregory Wasson | 0 | 21,094 | | Gregory Weaver | 0 | 11,311 | | All of the above and other executive officers as a group(4) | 1,050,291 | 3,676,948 |

  164. Directors and executive officers

    | Mr. McAdam also serves as a Director.* |

  165. Directors and executive officers

    | 1 | In addition to direct and indirect holdings, the “Stock” column includes shares that may be acquired within 60 days pursuant to the conversion of RSUs as follows: 146,019 shares for Mr. McAdam; 18,276 shares for Mr. Ellis; 43,216 shares for Mr. Stratton; and 54,272 shares for Ms. Walden. For Mr. Carrión, the “Stock” column also includes 3,831 shares that may be acquired within 60 days pursuant to the conversion of certain stock units under a deferred compensation plan. Prior to conversion, the shares underlying the RSUs and deferred compensation units may not be voted or transferred. No shares are pledged as security. |

  166. Directors and executive officers

    | 2 | Ms. Walden’s holdings include 14,210 shares held by a trust with which she shares voting and/or investment power. |

  167. Directors and executive officers

    | 3 | The “Total stock-based holdings” column includes, in addition to shares listed in the “Stock” column, stock-based units under deferred compensation plans and stock-based long-term incentive awards, which may not be voted or transferred. |

  168. Directors and executive officers

    | 4 | Does not include shares held by Ms. Walden, who ceased to be an executive officer as of December 31, 2017. |

  169. Directors and executive officers

    | Verizon 2018 Proxy Statement | | 61 |