Windstream 2008 Annual Report Download - page 34

employed with Windstream, then his unvested restricted stock or performance based restricted stock would have
immediately vested in full.
Performance Incentive Compensation Plan. During 2008, each of the named executive officers
participated in the Performance Incentive Compensation Plan, which is an annual bonus plan. If either executive
died or became “disabled” during the year, then his or her 2008 annual bonus under the Performance Incentive
Compensation Plan would have been pro-rated on the basis of the ratio of the number of days of participation
during the plan year to the number of days during the plan year and paid in a lump sum following the end of the
year. For this purpose, the term “disability” means incapacity resulting in the executive being unable to engage in
gainful employment at his usual occupation by reason of any medically demonstrable physical or mental
condition, excluding, however, incapacity resulting from a felonious enterprise; chronic alcoholism or addiction
to drugs or abuse; and self-inflicted injury or illness.
Change-in-Control
In general, Windstream does not maintain any plans or arrangements that would provide benefits to the
named executive officers solely as a result of a change-in-control (as defined under the heading “Qualifying
Termination Following Change-in-Control” below). However, Mr. Gardner would receive a lump sum payment
of his account balances maintained under the 1998 fund of the Windstream 2007 Deferred Compensation Plan
upon a change-in-control. All other non-qualified balances would only be subject to payment following a
qualifying termination following a change in control. Please refer to the section above entitled “Nonqualified
Deferred Compensation” for more information.
Qualifying Termination Following Change-in-Control
Each executive officer listed below would have been entitled to the following estimated payments and
benefits from Windstream or its successor if a change-in-control (as defined below) occurred on December 31,
2008 and Windstream terminated the executive’s employment without “cause” (as defined below) or the
executive terminated his employment with Windstream for “good reason” (as defined below) immediately
following such change-in-control.
Name
Cash
Severance
($) (1)
Cash Equivalent
for Health Care
Premiums
($)
Outplacement
Services
($)
Excise Tax
Gross-Up (2)
($)
Accelerated
Vesting of
Restricted
Shares (3)
($)
Total on a
Qualifying
Termination
Following a
Change-in-Control
($)
Jeffery R. Gardner 6,937,000 39,461 50,000 -0- 5,887,172 12,913,633
Brent Whittington 2,900,000 37,366 50,000 1,552,394 1,535,278 6,075,038
John P. Fletcher 2,392,500 39,461 50,000 1,130,102 1,171,289 4,783,352
Richard J. Crane 1,085,000 24,911 25,000 500,223 597,209 2,232,343
Robert G. Clancy 912,000 23,846 25,000 416,242 722,540 2,099,628
(1) This amount includes the annual incentive compensation at target for the year of termination. Actual 2008
payouts are reflected in the Non-Equity Incentive Plan Compensation column of the Summary Compensation
Table.
(2) Because the excise tax gross-up is calculated based on the average compensation of an executive officer
over the five years prior to a change-in-control, Windstream expects the amount of potential tax gross-up liability
to decrease in the future as Windstream executives increase their tenure in their existing positions.
(3) The value of the accelerated vesting of restricted shares equals the product of (i) the number of unvested
shares as of December 31, 2008, multiplied by (ii) the closing price of Windstream’s common stock on
December 31, 2008 of $9.20 per share.
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