Windstream 2006 Annual Report Download - page 37

contendere of Mr. Gardner for any felony; (iii) gross negligence or willful misconduct by Mr. Gardner that is
intended to or does result in his substantial personal enrichment or a material detrimental effect on the reputation
or business of Windstream or any affiliate; (iv) a material violation by Mr. Gardner of the corporate governance
board guidelines and code of ethics of Windstream or any affiliate; (v) a material violation by Mr. Gardner of the
requirements of the Sarbanes-Oxley Act of 2002 or other federal or state securities law, rule or regulation;
(vi) the repeated use of alcohol by Mr. Gardner that materially interferes with his duties, the use of illegal drugs,
or a violation of the drug and/or alcohol policies of Windstream or any affiliate; or (vii) a material breach by
Mr. Gardner of any non-solicitation, non-disparagement or confidentiality restrictions.
For purposes of the Employment Agreement, the term “good reason” generally means the occurrence,
without the executive’s express written consent, of any one or more of the following: (i) any action of
Windstream or its affiliates that results in a material adverse change in Mr. Gardner’s position (including status,
offices, title, and reporting requirements), authorities, duties, or other responsibilities; (ii) a material reduction by
Windstream in Mr. Gardner’s compensation; (iii) the failure of the Board of Directors to nominate Mr. Gardner
for election or re-election to the Board; or (iv) a material breach by Windstream of any provision of the
Employment Agreement that is not remedied promptly after receipt of notice thereof. Notwithstanding the
foregoing, in no event shall “good reason” occur as a result of the following: (i) a reduction in any component of
Mr. Gardner’s compensation if other components of his compensation are increased or a substitute or alternative
is provided so that his overall compensation is not materially reduced; (ii) Mr. Gardner does not earn cash
bonuses or benefit from equity incentives awarded to him because the performance goals or targets were not
achieved; and (iii) the suspension of Mr. Gardner for the period during which the Board of Directors is making a
determination whether to terminate him for cause.
Death or Disability
Windstream would have been obligated to provide each of the executive officers listed below (or his
beneficiary) with the following estimated payments, in a lump sum for bonus amounts, in the event that he had
died or become “disabled” (as defined below) while employed with Windstream on December 31, 2006.
Name
Accelerated Vesting
of Restricted
Shares (1)
($)
Accelerated Vesting of
Annual Bonus
($)
Total for Death or
Disability
($)
Jeffery R. Gardner 8,536,366 320,274 8,856,640
Brent Whittington 1,251,957 - 1,251,957
Francis X. Frantz 6,392,075 205,890 6,597,965
Keith D. Paglusch 1,128,556 - 1,128,556
John P. Fletcher 1,072,131 - 1,072,131
William G. Raney 478,565 - 478,565
(1) The value of the accelerated vesting of restricted shares is based on the closing price of Windstream’s
common stock on December 29, 2006 of $14.22 per share.
Accelerated Vesting of Restricted Shares. In the event that an executive officer listed above (other than
Mr. Raney) died or became permanently disability (as determined by the Compensation Committee in its sole
discretion) and while employed with Windstream, then his unvested restricted stock or performance based
restricted stock would have immediately vested in full. If Mr. Raney experienced such an event, a portion of the
unvested shares that are scheduled to vest on the next vesting date would have vested. The portion to vest is equal
to the product of (1) the number of shares scheduled to vest on the next vesting date multiplied by (2) the
quotient of (A) the number of days elapsed since the last vesting date divided by (B) 365.
Performance Incentive Compensation Plan. During 2006, each of Messrs. Gardner and Frantz
participated in the Performance Incentive Compensation Plan, which is an annual bonus plan. If either executive
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