Windstream 2013 Annual Report Download - page 43

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(3) These amounts represent one-third (1/3) of the threshold and target amounts of an award of performance-
based restricted stock units (or PBRSUs) granted to the named executive officer in 2011 that vest ratably over
a three-year period with each year set as a separate performance period. The Compensation Committee sets
the threshold and target Adjusted OIBDA amount each year during the three-year vesting period. As stated
above, pursuant to SEC rules and applicable accounting rules, because the Compensation Committee sets the
annual performance targets at the start of each respective performance period, only the grant date fair value
of the portion of the grant subject to a particular performance period is reported in this table, which results
in a disparity between the annual grant values approved by the Compensation Committee and the amounts
reported above.
Accordingly, these amounts represent only the third tranche of the total grant of PBRSUs in 2011 (i.e., the
portion of the 2011 grant allocated to the 2013 performance period).
(4) While no additional amounts are awarded if actual Adjusted OIBDA exceeds the target performance goal, these
amounts equal the sum of the target amount of the first tranche of the 2013 grant of PBRSUs plus one-third
(1/3) of the Overachievement Amount (as defined below). Pursuant to the 2013 grant of PBRSUs, each NEO is
entitled to receive an additional number of shares following completion of the three-year vesting period equal
to 50% of his/her Total Target Amount (the “Overachievement Amount”) if (i) Windstream’s total stockholder
return exceeds 75% of the S&P 500 during the vesting period, and (ii) at least 92% of the Adjusted OIBDA goal
is met in each of the three fiscal performance periods covered by the three-year vesting period.
(5) While no additional amounts are awarded if actual Adjusted OIBDA exceeds the target performance goal, these
amounts equal the sum of the target amount of the second tranche of the 2012 grant of PBRSUs plus one-third
(1/3) of the Overachievement Amount (as defined below). Pursuant to the 2012 grant of PBRSUs, each NEO is
entitled to receive an additional number of shares following completion of the three-year vesting period equal
to 50% of his/her Total Target Amount (the “Overachievement Amount”) if (i) Windstream’s total stockholder
return exceeds 75% of the S&P 500 during the vesting period, and (ii) at least 92% of the Adjusted OIBDA goal
is met in each of the three fiscal performance periods covered by the three-year vesting period.
(6) While no additional amounts are awarded if actual Adjusted OIBDA exceeds the target performance goal, these
amounts equal the sum of the target amount of the third tranche of the 2011 grant of PBRSUs plus one-third
(1/3) of the Overachievement Amount. Pursuant to the 2011 grant of PBRSUs, each NEO is entitled to receive
the Overachievement Amount following completion of the three-year vesting period if (i) Windstream achieves
revenue growth over the three-year vesting period of the 2011 grant, and (ii) at least 92% of the Adjusted
OIBDA goal is met in each of the three fiscal performance periods covered by the three-year vesting period.
(7) No options have been awarded by Windstream for fiscal years 2013, 2012 and 2011 to Messrs. Gardner, Thomas,
Whittington, Fletcher or Works.
(8) Represents restricted stock granted to the NEO that will vest ratably in one-third (1/3) annual increments
subject to continuous employment through February 15, 2016.
(9) Represents the grant date fair value calculated in accordance with applicable standards for financial statement
reporting purposes in accordance with FASB ASC Topic 718. The grant date fair values for the time-vesting
restricted stock is determined on the closing stock price of Windstream Common Stock on the date of grant.
The grant date fair values of the performance-based equity awards and the Overachievement Amount are
based on the stock price of Windstream Common Stock on the date of the grant, which is considered the date
the performance targets were set. Shares related to the 2013, 2012 and 2011 overachievement amounts cliff
vest in 2016, 2015 and 2014, respectively, if at all, based on the performance criteria described above. Because
the overachievement amounts are conditioned upon achievement of at least the threshold level of the Adjusted
OIBDA goal set by the Compensation Committee at the start of each performance period, only one-third (1/3)
of the overachievement shares related to the 2013, 2012 and 2011 criteria were included in the grant date fair
value calculation.