Business Context and Reporting Period
This Form 8-K is filed by Altice USA, Inc. (not Optimum Communications, Inc., which is a subsidiary brand) with a report date of January 28, 2020, covering events occurring on January 22, 2020. The filing details significant changes to executive compensation and equity award programs approved by the Compensation Committee.
Key Financial Metrics
This filing does not contain financial performance data such as revenue, profit, cash flow, margins, debt, or liquidity. The document focuses exclusively on corporate governance and executive compensation adjustments.
Material Changes
- Executive Salary Adjustment: The annual base salary of Michael Grau, Chief Financial Officer, was increased from $325,000 to $400,000 for fiscal year 2020.
- Equity Program Restructuring: The company shifted from an annual grant cycle to a four-year grant cycle for management and named executive officers.
- Stock Option Grants: Options were granted to key executives with an exercise price of $28.36:
- Dexter Goei (CEO): 4,000,000 shares
- Abdelhakim Boubazine (President/COO): 2,000,000 shares
- Michael Grau (CFO): 750,000 shares
- Patrick Drahi (Advisor): 4,000,000 shares
- Performance Stock Units (PSUs): PSUs were granted with vesting tied to stock price hurdles of $50.00 and $60.00.
- Dexter Goei: 346,240 ($50 hurdle) and 843,733 ($60 hurdle)
- Abdelhakim Boubazine: 173,120 ($50 hurdle) and 421,867 ($60 hurdle)
- Michael Grau: 64,920 ($50 hurdle) and 158,200 ($60 hurdle)
- Patrick Drahi: 346,240 ($50 hurdle) and 843,733 ($60 hurdle)
Guidance, Outlook, and Risks
Contingencies: The new equity awards and the Amended and Restated Altice USA 2017 Long Term Incentive Plan are contingent upon shareholder approval at the 2020 annual meeting of shareholders.
Vesting Conditions: Stock options vest over four years (50%, 25%, 25%) based on continued service. PSUs vest only if the 30-day volume weighted average trading price reaches $50.00 or $60.00. If these targets are not met by January 29, 2024 (or 2026 in the event of a recession or market disruption), the PSUs will be forfeited.
Investor Verification Checklist
- Verify the outcome of the shareholder vote on the Amended and Restated Plan at the 2020 annual meeting.
- Monitor the company's stock price relative to the $50.00 and $60.00 PSU vesting hurdles.
- Review the total dilution impact of the 11,750,000 stock options and associated PSUs granted to executives and advisors.
- Confirm the effective date of the CFO's salary increase in subsequent financial statements.