Windstream 2012 Annual Report Download - page 41

(immediately before the combination) do not make up a majority of the board of the combined enterprise; or (iv)
stockholders approve a complete liquidation of Windstream.
•Cause. In general a termination is for cause if it is for any of the following reasons: (i) the willful failure by the
executive substantially to perform his duties with Windstream; (ii) a conviction, guilty plea or plea of nolo
contendere of the executive for any felony; (iii) the willful misconduct by the executive that is demonstratively and
materially injurious to Windstream or its affiliates, monetarily or otherwise; (iv) a material violation by the
executive of the corporate governance board guidelines and code of ethics of Windstream or any affiliate; (v) a
material violation by the executive 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 the executive 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 the executive of any non-solicitation or confidentiality restrictions.
•Good Reason. In general a termination by the executive is for good reason if it is for any of the following reasons:
(i) the assignment to the executive of any duties inconsistent with the executive’s status as an executive officer or a
substantial adverse change in the nature or status of the executive’s responsibilities; (ii) a reduction by Windstream
in the executive’s annual base salary; (iii) the relocation of the principal executive offices of Windstream by more
than 35 miles or Windstream’s requiring the executive to be based anywhere other than its principal executive
offices; (iv) the failure by Windstream to pay to the executive any portion of the executive’s current compensation,
deferred compensation or business expense reimbursements; (v) the failure by Windstream to continue in effect any
compensation plan in which the executive participates unless an equitable alternative arrangement has been made, or
the failure by Windstream to continue the executive’s participation in those plans; (vi) the failure by Windstream to
continue to provide the executive with benefits substantially similar to those enjoyed by the executive under any of
Windstream’s retirement, welfare and fringe benefit plans; (vii) any purported termination by Windstream of the
executive’s employment that is not effected in accordance with the terms of the Change-in-Control Agreement; or
(viii) any failure by Windstream to require the successor to assume the agreement.
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, 2012 and Windstream
terminated the executive’s employment without “cause” (as defined below) or the executive terminated his or her
employment with Windstream for “good reason” (as defined below) immediately following such change-in- control.
Name
Cash
Severance
($) (1)
Pro-Rated
Bonus
Cash Equivalent
for Health Care
Premiums
($)
Outplacement
Services
($)
Excise Tax
Gross-Up
($)
Accelerated
Vesting of
Restricted
Shares (2)
($)
Total on a
Qualifying
Termination
Following a
Change-in-Control
($)
Jeffery R. Gardner 7,050,000 1,350,000 52,614 50,000 -0- 6,459,866 14,962,480
Anthony W. Thomas 1,800,000 (3) 400,000 34,606 25,000 (3) -0- 1,741,425 4,001,031
Brent Whittington 3,429,000 508,000 52,614 50,000 -0- 2,198,679 6,238,293
John P. Fletcher 2,700,000 400,000 47,973 50,000 -0- 1,781,616 4,979,589
Cynthia B. Nash 1,275,000 262,500 20,572 25,000 -0- 946,172 2,529,244
(1) This amount includes the annual incentive compensation for the year of termination, which is reflected in the Grants of
Plan-Based Awards Table. Actual 2012 payouts are reflected in the Non-Equity Incentive Plan Compensation column of
the Summary Compensation Table.
(2) The value of the accelerated vesting of restricted shares is based on the closing price of Windstream’s Common Stock on
December 31, 2012 of $8.28 per share.
(3) The amounts disclosed for Mr. Thomas represent the amounts stipulated by the change-in-control agreement that was in
place as of December 31, 2012. A new change-in-control agreement was put in place for Mr. Thomas as of January 1,
2013. Mr. Thomas is now eligible for a sum of three times his base salary and target annual incentive compensation and
$50,000 for outplacement services.
Clawback Policy. Windstream has a clawback policy that requires executive officers to repay or forfeit
performance-based compensation under certain conditions. Effective January 1, 2013, the policy covers the following types
of compensation: annual or short-term incentive compensation, performance-based restricted stock or units, other
performance-based compensation, and such other compensation as may be designated by resolution to be subject to the
policy. The policy does not cover time-based restricted stock or severance benefits awarded under a change-in-control
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