Windstream 2014 Annual Report Download - page 40

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In exchange for these benefits, Mr. Whittington agreed to continue serving as a full-time employee until
September 1, 2014 and execute a release of claims in favor of Windstream. Mr. Whittington also agreed to be subject
to certain non-disclosure, non-competition, and non-solicitation restrictions and remains subject to Windstream’s
clawback policy.
Other Compensation
Retirement Plans. Windstream maintains a defined benefit pension plan and a qualified 401(k) defined
contribution plan for its executive officers (including the NEOs) and employees. Participation in the pension plan
is frozen except for certain bargaining unit employees. No executive officer is eligible for continued accruals.
Windstream’s 401(k) plan provides for potential matching employer contributions of up to 4% of a participant’s
compensation. The Compensation Committee maintains the 401(k) plan in order to provide employees with
an opportunity to save for retirement with pre-tax dollars. The 401(k) plan also allows Windstream to fund its
contributions to this plan in a predictable, consistent manner.
Deferred Compensation Plans. Windstream’s 2007 Deferred Compensation Plan provides a non-qualified
deferred compensation plan for its executive officers (including the NEOs) and other key employees. The
Compensation Committee adopted this plan as part of its effort to provide a total compensation package that was
competitive with the compensation arrangements of other companies. The plan offers participants the ability to defer
compensation above the IRS qualified plan limits.
Perquisites/Aircraft Use. Effective February 2015, Mr. Thomas is allowed to utilize Windstream’s corporate
aircraft for personal use under a time-sharing arrangement pursuant to which he is obligated to reimburse Windstream
for the incremental cost of such use (which primarily includes costs for fuel, maintenance charges allocable to
such use and contract-pilot charges, and excludes depreciation of the aircraft, general maintenance, compensation
of Windstream’s employee pilots, and other general charges related to ownership of the aircraft). All other NEOs
are permitted limited personal use of Windstream’s corporate aircraft and are allowed to have family members
accompany them on business trips on the aircraft, in each case subject to prior approval of Messrs. Thomas or
Fletcher. The Compensation Committee monitors the use by Mr. Thomas and all other NEOs to ensure the amount
of usage is reasonable. The Compensation Committee believes that personal use of aircraft for Mr. Thomas and all
other NEOs is a reasonable benefit in light of the significant demands that are imposed on their schedules as a result
of their responsibilities to Windstream.
Stock Ownership/Insider Trading Policies
Windstream’s minimum share ownership guidelines apply to Mr. Thomas and all other executive officers. The
guidelines are described in this proxy statement under the heading “Stock Ownership Guidelines.” The minimum
share ownership guidelines are intended in part to ensure that executive officers retain a sufficient number of shares
of Windstream Common Stock such that they continue to have a material financial interest in Windstream which
is aligned with the stockholders. In addition, under Windstream’s insider trading compliance policy, directors and
executive officers are prohibited from engaging in any transaction involving derivative securities intended to hedge
the market risk in equity securities of Windstream other than purchases of long call options or the sale of short put
options that are not closed prior to their exercise or expiration date. The policy also prohibits the purchase of shares
on loan or margin and short sales.
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 agreement. Under the policy, each executive officer is required to forfeit or repay covered compensation, to
the fullest extent permitted by law, if all of the following conditions are met: (i) Windstream financial statements
filed during an executive officer’s employment become subject to a restatement; (ii) the Board determines that fraud
caused or significantly contributed to the need for the restatement; (iii) the Board determines that the restatement