Windstream 2012 Annual Report Download - page 37

respect to service earned in such succeeding year. In addition, participants receive an additional credit of 0.25% for each pre-
1988 year of service after age 55, subject to a maximum of 10 years of credit, plus an amount equal to 0.4% of the amount by
which the participant’s pre-1988 career average annual base salary (three highest years) exceeds his or her Social Security
covered compensation, multiplied by his years of pre-1988 credited service.
Windstream Benefit Restoration Plan. The Windstream Benefit Restoration Plan (“BRP”) contains an unfunded,
unsecured pension benefit for a group of highly compensated employees whose benefits are reduced due to the IRS
compensation limits for qualified plans. This plan was established by Alltel and assumed by Windstream at the spin-off. As
with the Pension Plan, accruals are frozen for employees. No named executive officers continued to be eligible for accruals
in the pension benefit of the BRP as of the end of 2012. The pension benefit under the BRP is calculated as the excess, if any,
of (x) the participant’s Pension Plan benefit (on a single life-annuity basis payable commencing on the later of the
participant’s retirement date or age 65) without regard to the IRS compensation limit ($250,000 for 2012) over (y) the
participant’s regular Pension Plan benefit (on a single life-annuity basis payable commencing on the later of the participant’s
retirement date or age 65 regardless of the actual form or timing of payment). If the participant has not attained age 65 on the
date his benefit is scheduled to commence, the BRP benefit is reduced to the extent as the Pension Plan benefit would have
been reduced as in effect on December 31, 2012. For purposes of the preceding calculations, compensation has the same
meaning provided in the foregoing description of the Pension Plan. The payment of a participant’s retirement benefit under
the BRP shall commence as of the first day of the first month following the later of (i) his 60th birthday or (ii) the six-month
anniversary of the participant’s separation from service. Benefits are paid over the life of the participant if the participant is
alive when benefits commence or over the life of the spouse if the benefit is paid as a pre-retirement death benefit. The
benefit will be paid in one lump sum payment if the actuarial present value is less than $30,000. To the extent permitted by
the IRC Section 409A, the Benefits Committee comprised of the Chief Financial Officer and Treasurer, Chief Operating
Officer, Executive Vice President-Chief Human Resources Officer and Vice President-Benefits, authorized by the Board of
Directors to manage the operation and administration of all employee benefit plans, including non-qualified plans, may direct
that the benefit be paid in an alternative form provided that it is the actuarial equivalent of the normal form of benefit so that
the BRP benefit is paid in the same form as the Pension Plan benefit. None of the named executive officers were yet eligible
to commence their benefit under the BRP as of the end of 2012.
The following table shows certain information regarding benefits under the Windstream Pension Plan and Benefit
Restoration Plan as of December 31, 2012 for the individuals named below.
PENSION BENEFITS
Name Plan Name
Number of Years
Credited Service
(#) (1)
Present Value of
Accumulated Benefit
($) (2)
Payments During
Last Fiscal Year
($)
Jeffery R. Gardner Pension Plan
Benefit Restoration Plan
12
-
346,821
2,484,749
-0-
-0-
Anthony W. Thomas Pension Plan
Benefit Restoration Plan
7
-
108,441
9,257
-0-
-0-
Brent Whittington Pension Plan
Benefit Restoration Plan
3.5
-
54,124
7,664
-0-
-0-
John P. Fletcher Pension Plan
Benefit Restoration Plan
-
-
-
-
-
-
Cynthia B. Nash Pension Plan
Benefit Restoration Plan
-
-
-
-
-
-
(1) Each NEO’s number of years credited service recognizes only prior years of service under the Alltel Corporation
Pension Plan and the Alltel Corporation Benefit Restoration Plan.
(2) The present value of accumulated benefits includes the present value of the benefits transferred from the Alltel
Corporation Pension Plan and the Alltel Corporation Benefit Restoration Plan as part of the spin-off. The present value
of accumulated benefits was calculated based on retirement at age 60 with 20 years of credited service, current
compensation as of December 31, 2012, no pre-retirement decrements, the RP-2000 combined healthy mortality table
(projected to 2013), and a 3.85% discount rate, which is the same rate used for preparing Windstream’s consolidated
financial statements.
Non-Qualified Deferred Compensation
The Windstream 2007 Deferred Compensation Plan (the “2007 Plan”) is a non-qualified deferred compensation plan
offered to executive officers and other key employees. Participants may defer up to 25% of base salary and 50% of bonus.
The 2007 Plan also allows Windstream to make discretionary contributions to the 2007 Plan to replace contributions that
Windstream is limited from making to its 401(k) qualified plan as a result of limits imposed by the Internal Revenue Code.
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