Windstream 2011 Annual Report Download - page 51

PROPOSAL NO. 4
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Audit Committee has selected PricewaterhouseCoopers LLP (“PwC”) to audit Windstream’s
consolidated financial statements for the fiscal year ending December 31, 2012. Windstream is submitting to the
stockholders for ratification at the Annual Meeting the selection of PwC as Windstream’s independent auditors
for 2012, although neither the Board of Directors nor its Audit Committee maintains a policy requiring
Windstream to seek stockholder ratification of the independent auditor selection. PwC also served as
Windstream’s independent auditor during 2010 and 2011 in connection with the audits of the 2010 and 2011
fiscal years. Information regarding PwC’s fees for 2010 and 2011 is provided below under the caption “Audit
and Non-Audit Fees.” Representatives of PwC are expected to be present at the 2012 Annual Meeting and will
have an opportunity to make a statement, if they desire to do so, and to respond to appropriate questions.
If the stockholders fail to ratify the appointment of PwC as Windstream’s independent registered public
accountant, the Board will reconsider the appointment. However, even if the selection is ratified, the Audit
Committee, in its sole discretion, may change the appointment at any time during the year if it determines that
such a change would be in the best interests of Windstream and its stockholders.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS
VOTE “FOR” PROPOSAL NO. 4. PROXIES SOLICITED BY THE BOARD OF DIRECTORS WILL BE
VOTED FOR PROPOSAL NO. 4 UNLESS STOCKHOLDERS SPECIFY A CONTRARY VOTE.
PROPOSAL NO. 5
STOCKHOLDER PROPOSAL
The stockholder proposal, which follows, is a verbatim submission by the Trust for the International
Brotherhood of Electrical Workers’ Pension Benefit Fund (who has notified Windstream that it is the beneficial
owner of Windstream Common Stock valued at more than $2,000), whose address is 900 Seventh Street, N.W.,
Washington, D.C. 20001, for consideration by Windstream stockholders. All statements contained in the
proposal are the sole responsibility of the Fund.
RESOLVED: The shareholders hereby ask the board of directors of Windstream Corporation (the
“Company”) to adopt a policy that in the event of a change of control of the Company, there shall be no
acceleration in the vesting of any equity award to a senior executive, provided that any unvested award may vest
on a pro rata basis up to the time of a change of control event. To the extent any such unvested awards are based
on performance, the performance goals must have been met. This policy shall apply to future awards without
affecting any contractual obligations that may exist at the time.
SUPPORTING STATEMENT
Under various employment agreements and plans, the Company’s senior executives will receive “golden
parachute” awards under specified circumstances following a change in control of the Company.
We support the concept of performance-based equity awards to senior executives to the extent that such
awards are tailored to promote performance and align executives’ interests with those of the shareholders. We
also believe that severance payments may be appropriate in some circumstances following a change of control.
We are concerned, however, that the Company’s current practices can disregard performance criteria
upon a change of control. Instead, they can permit full and immediate accelerated vesting of unearned equity
awards.
The Company’s 2011 proxy summarizes the potential exposure if unvested equity awards should vest
upon a change in control. According to the proxy, if there had been a change of control on December 31, 2010,
CEO Jeffery R. Gardner would have been eligible to receive more than $36 million in severance and benefits,
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