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Stock-Based Compensation (Tables) | 12 Months Ended
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Dec. 31, 2022
Share-Based Payment Arrangement, Noncash Expense [Abstract] |
Stock-based compensation | The following table summarizes stock-based compensation expense recognized during 2022, 2021 and 2020:
Year Ended December 31, | 2022 |  | 2021 |  | 2020
(Dollars in millions) |  |  |  |  |
Stock option awards | $ | 1 |  |  | $ | 2 |  |  | $ | 3 |
Restricted stock unit awards | 28 |  |  | 29 |  |  | 30 |
Performance share unit awards | 11 |  |  | 16 |  |  | 17 |
Deferred compensation bonus and matching stock unit awards | — |  |  | — |  |  | 1 |
Awards under Non-Employee Director compensation plan | 2 |  |  | 2 |  |  | 2 |
Total stock-based compensation, before income taxes | 42 |  |  | 49 |  |  | 53 |
Income tax benefit | (11) |  |  | (12) |  |  | (13) |
Total stock-based compensation expense, net of income taxes | $ | 31 |  |  | $ | 37 |  |  | $ | 40 |
Stock-based compensation, allocation by financial statement line item | The following table provides a summary of the classification of stock-based compensation expense included in the Consolidated Statement of Operations for the years ended:
December 31, | 2022 |  | 2021 |  | 2020
(Dollars in millions) |  |  |  |  |
Selling, general and administrative expense | $ | 36 |  |  | $ | 44 |  |  | $ | 48 |
Cost of services expense | 6 |  |  | 5 |  |  | 5 |
Total stock-based compensation expense | $ | 42 |  |  | $ | 49 |  |  | $ | 53 |
Stock-based compensation, fair value assumptions | TDS estimated the fair value of stock options granted in 2021 and 2020 using the Black-Scholes valuation model and the assumptions shown in the table below:
|  | 2021 |  | 2020
Expected life |  | 6.3 years |  | 6.2 years
Expected annual volatility rate |  | 36.6 | % |  | 35.0 | %
Dividend yield |  | 2.8 | % |  | 3.6 | %
Risk-free interest rate |  | 1.1 | % |  | 0.5 | %
Summary of stock options | A summary of TDS stock options (total and portion exercisable) and changes during 2022 is presented in the tables and narrative below.
Common Share Options | Number of Options |  | Weighted Average Exercise Prices |  | Aggregate Intrinsic Value (in millions) |  | Weighted Average Remaining Contractual Life (in years)
Outstanding at December 31, 2021 | 4,088,000 |  |  | $ | 25.50 |  |  |  |  |
Exercised | (1,000) |  |  | $ | 19.15 |  |  |  |  |
Forfeited | (86,000) |  |  | $ | 22.42 |  |  |  |  |
Expired | (903,000) |  |  | $ | 22.82 |  |  |  |  |
Outstanding at December 31, 2022 | 3,098,000 |  |  | $ | 26.37 |  |  | $ | — |  |  | 4.2
(2,539,000 exercisable) |  |  | $ | 27.34 |  |  | $ | — |  |  | 3.3
Summary of nonvested restricted stock units | A summary of TDS nonvested restricted stock units and changes during 2022 is presented in the table below:
Common Restricted Stock Units | Number |  | Weighted Average Grant Date Fair Value
Nonvested at December 31, 2021 | 1,592,000 |  |  | $ | 22.25 |
Granted | 784,000 |  |  | $ | 15.34 |
Vested | (411,000) |  |  | $ | 27.91 |
Forfeited | (141,000) |  |  | $ | 20.23 |
Nonvested at December 31, 2022 | 1,824,000 |  |  | $ | 18.16 |
A summary of UScellular nonvested restricted stock units and changes during 2022 is presented in the table below:
Common Restricted Stock Units | Number |  | Weighted Average Grant Date Fair Value
Nonvested at December 31, 2021 | 1,601,000 |  |  | $ | 35.57 |
Granted | 881,000 |  |  | $ | 30.35 |
Vested | (321,000) |  |  | $ | 45.70 |
Forfeited | (161,000) |  |  | $ | 33.10 |
Nonvested at December 31, 2022 | 2,000,000 |  |  | $ | 31.84 |
Summary of nonvested performance share units | A summary of TDS nonvested performance share units and changes during 2022 is presented in the table below:
Common Performance Share Units | Number |  | Weighted Average Grant Date Fair Value
Nonvested at December 31, 2021 | 1,085,000 |  |  | $ | 23.46 |
Granted | 522,000 |  |  | $ | 17.42 |
Vested | (227,000) |  |  | $ | 30.72 |
Change in units based on approved performance factors | 63,000 |  |  | $ | 30.72 |
Forfeited | (156,000) |  |  | $ | 25.79 |
Accumulated dividend equivalents | 62,000 |  |  | $ | 20.00 |
Nonvested at December 31, 2022 | 1,349,000 |  |  | $ | 19.81 |
A summary of UScellular’s nonvested performance share units and changes during 2022 is presented in the table below:
Common Performance Share Units | Number |  | Weighted Average Grant Date Fair Value
Nonvested at December 31, 2021 | 1,049,000 |  |  | $ | 35.17 |
Granted | 487,000 |  |  | $ | 31.35 |
Vested | (183,000) |  |  | $ | 44.44 |
Forfeited | (105,000) |  |  | $ | 32.99 |
Nonvested at December 31, 2022 | 1,248,000 |  |  | $ | 32.51 |

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- Definition Tabular disclosure of allocation of amount expensed and capitalized for award under share-based payment arrangement to statement of income or comprehensive income and statement of financial position. Includes, but is not limited to, corresponding line item in financial statement. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(1) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 + Details
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- Definition Tabular disclosure for stock option plans. Includes, but is not limited to, outstanding awards at beginning and end of year, grants, exercises, forfeitures, and weighted-average grant date fair value. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (e) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (c)(1) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 + Details
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- Definition Tabular disclosure of the significant assumptions used during the year to estimate the fair value of stock options, including, but not limited to: (a) expected term of share options and similar instruments, (b) expected volatility of the entity's shares, (c) expected dividends, (d) risk-free rate(s), and (e) discount for post-vesting restrictions. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (f)(2) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 + Details
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