EMPLOYMENT AGREEMENT
EXHIBIT
10.33
EMPLOYMENT AGREEMENT (the “Agreement”) made as of December 31, 2009, effective as of January
1, 2010 (the “Effective Date”), between TIME WARNER CABLE INC. (the “Company”), a Delaware
corporation, and XXXXXX X. XXXXXX (“you” or “your”).
You and the Company desire to set forth the terms and conditions of your employment by the
Company and agree as follows:
1. Term of Agreement. The term of this Agreement shall be for the period beginning
on the Effective Date and ending on December 31, 2012 (the “Term”), subject, however, to earlier
termination as set forth in this Agreement.
2. Employment. During the Term, (a) you shall serve as Senior Executive Vice
President and Chief Financial Officer of the Company, and you shall have the authority, functions,
duties, powers and responsibilities normally associated with such position (including, without
limitation, the authority, functions, duties, powers and responsibilities you hold as of the date
hereof), and such other title, authority, functions, duties, powers and responsibilities as may be
assigned to you from time to time by the Company consistent with your senior position with the
Company; (b) your services shall be rendered on a substantially full-time, exclusive basis and you
will apply on a full-time basis all of your skill and experience to the performance of your duties;
(c) you shall report solely to the Chief Executive Officer of the Company (the “CEO”); (d) you
shall have no other employment and, without the prior written consent of the CEO, no outside
business activities which require the devotion of substantial amounts of your time; (e) you shall
adhere to the Company’s policies in effect during your employment, including its Standards of
Business Conduct, Xxxxxxx Xxxxxxx Policy, and the stock ownership or retention guidelines adopted
by the Company, if any; and (f) the place for the performance of your services shall be at the
Company’s principal corporate offices in the New York metropolitan area, subject to such reasonable
travel as may be required in the performance of your duties. For purposes of this Section 2,
“Company” shall mean either Time Warner Cable Inc. or, if Time Warner Cable Inc. becomes a
controlled subsidiary of another entity, then the ultimate parent company of Time Warner Cable Inc.
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foregoing shall be subject to the Company’s written policies, as in effect from time to time,
regarding vacations, holidays, illness and the like.
3. Compensation.
3.1. Base Salary. The Company shall pay you a base salary at the rate of not less
than $900,000 per annum during the Term (“Base Salary”). The Company may increase, but not
decrease, your Base Salary during the Term. Base Salary shall be paid in accordance with the
Company’s customary payroll practices.
3.2. Bonus. In addition to Base Salary, the Company typically pays its executives an
annual cash bonus (“Bonus”). Although your Bonus is fully discretionary, during the Term your
target annual Bonus (“Target Bonus”) will be $1,500,000 or such other higher amount as approved
each year by the Compensation Committee of the Company’s Board of Directors (“Compensation
Committee”), pro-rated with respect to partial years. Each year, the Company’s performance and
your personal performance will be considered in the context of your executive duties and any
individual goals set for you, and your actual Bonus will be determined. Although as a general
matter the Company expects to pay bonuses at the target level in cases of satisfactory performance,
it does not commit to do so, and your Bonus may be higher or lower than your Target Bonus. Your
Bonus amount, if any, will be paid to you between January 1 and March 15 of the calendar year
immediately following the performance year in respect of which such Bonus is earned at the same
time as bonuses are paid to other senior executives.
3.3. Long-term Incentive Compensation. For each year of the Term, the Company shall
provide you with long-term incentive compensation with a target value of at least approximately
$3,100,000 through a mix of stock options, restricted stock, restricted stock units (RSUs), other
forms of equity compensation, cash-based long-term plans or other components as may be determined
by the Compensation Committee from time to time in its sole discretion (“Long-term Incentive
Awards”), subject to the terms of any Company plans governing the granting of Long-term Incentive
Awards, and the terms of any related award agreements in accordance with the Company’s customary
practices.
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3.4. Additional Compensation Plans. In addition to the above compensation, and at
the Company’s discretion, you will be eligible to participate in other compensation plans and
programs available to executives at your level (“Additional Compensation Plans”). The Company
shall maintain full discretion to amend, modify or terminate such Additional Compensation Plans,
and full discretion over the decision to award you compensation under such Additional Compensation
Plans and the amount of such an award, if any.
3.5. Indemnification. You shall be entitled throughout the Term (and after the end
of the Term, to the extent relating to service during your employment) to the benefit of the
indemnification provisions contained on the date hereof in the Restated Certificate of
Incorporation and By-laws of Time Warner Cable Inc. (not including any amendments or
additions after the date hereof that limit or narrow, but including any that add to or broaden, the
protection afforded to you by those provisions).
4. Termination.
4.1. Termination for Cause; Voluntary Resignation. The Company may terminate your
employment for “cause” and you may voluntarily resign your employment prior to the expiration of
the Term. Upon the termination of your employment for cause or your voluntary resignation, all of
the obligations under this Agreement shall terminate, other than the Company’s obligations set
forth below in Section 4.1.2 and the provisions identified in Section 10.13 (Survival).
4.1.1. Definition of Cause. Termination by the Company for “cause” shall mean
termination because of your (a) conviction (treating a nolo contendere plea as a conviction) of a
felony (whether or not any right to appeal has been or may be exercised) other than as a result of
a moving violation or a Limited Vicarious Liability (as defined below), (b) willful failure or
refusal without proper cause to perform your material duties with the Company, including your
material obligations under this Agreement (other than any such failure resulting from your
incapacity due to physical or mental impairment), (c) willful misappropriation, embezzlement, fraud
or any reckless or willful destruction of Company property having a significant adverse financial
effect on the Company or a significant adverse effect on the Company’s reputation, (d) willful and
material breach of any statutory or common law duty of loyalty to the Company having a
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significant adverse financial effect on the Company or a significant adverse effect on the
Company’s reputation; (e) material and willful breach of any of the restrictive covenants provided
for in Section 8 (Restrictive Covenants) below; or (f) a willful violation of any material Company
policy, including the Company’s Standards of Business Conduct having a significant adverse
financial effect on the Company or a significant adverse effect on the Company’s reputation. Such
termination shall be effected by written notice thereof delivered by the Company to you and shall
be effective as of the date of such notice; provided, however, that if (i) such termination is
because of your willful failure or refusal without proper cause to perform your material duties
with the Company including any one or more of your material obligations under this Agreement, and
(ii) within 15 days following the date of such notice you shall cease your refusal and shall use
your best efforts to perform such obligations, the termination shall not be effective. The term
“Limited Vicarious Liability” shall mean any liability which is based on acts of the Company for
which you are responsible solely as a result of your office(s) with the Company; provided that (x)
you are not directly involved in such acts and either had no prior knowledge of such actions or,
upon obtaining such knowledge, promptly acted reasonably and in good faith to attempt to prevent
the acts causing such liability or (y) after consulting with the Company’s counsel, you reasonably
believed that no law was being violated by such acts.
4.1.2. Obligations Upon Termination For Cause or Voluntary Resignation. In the event
of your termination of employment by the Company for cause or your voluntary resignation, without
prejudice to any other rights or remedies that the Company may have at law or in equity, the
Company shall have no further obligation to you other than (i) to pay Base Salary through the
effective date of termination, (ii) with respect to any rights you have pursuant to any insurance
or other benefit plans or arrangements of the Company, (iii) with respect to any rights to
indemnification that you may have under Section 3.5 above, and (iv) if your employment is
terminated pursuant to Sections 4.1.1(b) or 4.1.1(f) above, the Company shall pay you any Bonus for
any year prior to the year in which such termination of employment occurs that has been determined
but not yet paid as of the date of such termination of employment. You hereby disclaim any right
to receive a pro rata portion of any Bonus with respect to the year in which such termination or
resignation occurs. Payments of Base Salary required under this Section shall be made at the same
time as such payments
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would otherwise have been made to you pursuant to Sections 3.1 (Base Salary) if your
employment had not been terminated.
4.2. Termination by You for Good Reason and Termination by the Company Without Cause.
Unless previously terminated pursuant to any other provision of this Agreement, you shall have the
right, exercisable by written notice to the Company, to terminate your employment for “Good Reason”
effective 15 days after the giving of such notice, if, at the time of the giving of such notice,
the Company is in material breach of its obligations under this Agreement without your express
written consent; provided, however, that, with the exception of clause (i) below, this Agreement
shall not so terminate if such notice is the first such notice of termination delivered by you
pursuant to this Section 4.2 and within such 15-day period the Company shall have cured all such
material breaches. Any such notice of termination for Good Reason must be provided to the Company
within 90 days of any material breach of the Agreement. A material breach by the Company shall
include, but not be limited to, (i) the Company’s violation of Sections 2(a), 2(c) or 2(f) with
respect to your title, reporting lines, authority, functions, duties, powers, responsibilities or
place of employment, or (ii) the Company failing to cause any successor to all or substantially all
of the business and assets of the Company expressly to assume the obligations of the Company under
this Agreement as provided by Section 10.4 (Assignability). The Company shall have the right,
exercisable by written notice to you, to terminate your employment under this Agreement without
cause, which notice shall specify the effective date of such termination.
4.2.1. Termination Benefits. After the effective date of a termination of employment
without cause or for Good Reason pursuant to this Section 4.2, you shall receive Base Salary and a
pro rata portion of your Bonus through the effective date of termination, subject to the actual
achievement of the performance criteria established for the Company for the year of termination,
provided that your individual performance score shall be equal to the Company’s performance score,
as determined by the Company. Your pro rata Bonus pursuant to this Section 4.2.1 shall be paid to
you at the times set forth in Section 4.5 (Payments).
4.2.2. Severance Benefits. After the effective date of a termination of employment
without cause or for Good Reason pursuant to Section 4.2, you shall continue to receive Base Salary
and Bonus compensation and the post-
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termination benefits specified in Section 7.2 for a period ending on the date which is 24
months after the effective date of such termination (the “Severance Period”). During the Severance
Period you shall be entitled to receive, whether or not you become disabled during the Severance
Period, (a) Base Salary at an annual rate equal to your Base Salary in effect immediately prior to
the notice of termination, and (b) an annual Bonus in respect of each calendar year or portion
thereof (in which case a pro rata portion of such Bonus will be payable) during the Severance
Period equal to your Target Bonus in effect immediately prior to the notice of termination.
Payments made pursuant to this Section 4.2.2 shall be paid to you at the times set forth in Section
4.5 (Payments). Effective as of the date of your termination of employment pursuant to Section
4.2, any outstanding Long-term Incentive Awards granted during the Term shall immediately vest in
full and any stock option awards granted during the Term shall become immediately exercisable for
the time periods set forth in the respective stock option award agreements.
4.2.2.1. Other Full-Time Employment or Death During the Severance Period. Except as
provided in the following sentence, if you accept other full-time employment, excluding employment
with an affiliate (“Other Employment”) during the Severance Period or notify the Company in writing
of your intention to terminate your post-termination benefits under Section 7.2, effective upon the
commencement of such Other Employment or the effective date of such termination as specified by you
in such notice, whichever is applicable, the continuation of the post-termination health and
welfare benefits specified in Section 7.2 shall terminate, but you shall continue to receive the
remaining payments you would have received pursuant to Section 4.2.2 at the times specified
therein. Notwithstanding the foregoing, if you accept employment with any not-for-profit
organization, as defined by Internal Revenue Code (“Code”) Section 501(c), then you shall be
entitled to continue to receive the post-termination health and welfare benefits specified in
Section 7.2 and the payments as provided in the first sentence of Section 4.2.2. Furthermore, if
you accept employment with any affiliate of the Company or die during the Severance Period, then
the payments provided for in Section 4.2.2 shall immediately cease and you (or your estate or
designated beneficiary(ies)) shall not be entitled to any further payments; provided that you shall
be entitled to a prorated Target Bonus for the year in which your employment by the affiliate
commences or the year of your death, as applicable, based on the number of whole or partial months
in such calendar year prior to the date of your employment by the affiliate or the date of your
death, as determined by the Company. For purposes of
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this Agreement, the term “affiliate” shall mean any entity which, directly or indirectly,
controls, is controlled by, or is under common control with, the Company. For purposes of
enforcing the terms of this Section 4.2.2.1, you acknowledge and agree that you will provide the
Company with written notice of your intent to accept Other Employment, other part-time employment,
other employment by a not-for-profit entity, or employment by an affiliate, including, the identity
of the entity or person you intend to be employed by, the anticipated start date of your employment
and a contact at such entity who can verify your employment terms. Any income from any Other
Employment you may obtain shall not be applied to reduce the Company’s obligations under this
Agreement.
4.2.3. Termination of Employment Upon Change In Control. Notwithstanding the
foregoing, if your employment is terminated pursuant to Section 4.2 hereof following (a) Change In
Control (as defined in the Time Warner Cable 2006 Stock Incentive Plan or any successor plan “the
Stock Plan”) or (b) the Company’s execution of an applicable merger, acquisition, sale or other
agreement providing for a Change In Control (“a CIC Agreement”) but before the date that is 24
months after a Change In Control (or, if earlier, the expiration or termination of the CIC
Agreement without a Change In Control), you shall (i) receive the severance benefits provided in
Section 4.2.2, provided that, for purposes of this sub-clause (i) and sub-clause (ii) of this
Section only, your Severance Period under such circumstances shall be 36 months rather than 24
months, and (ii) receive the post-termination benefits provided in Section 7.2; provided that for
purposes of Section 7.2(b) your Severance Period shall be 24 months. Any employment terminations
for “cause” pursuant to Sections 4.1.1 (b) or 4.1.1 (f) above within 24 months following a Change
In Control shall be deemed terminations without cause for purposes of severance benefits (as
provided in sub-clauses (i) and (ii) above) and treatment of the Company’s (or any successor’s)
outstanding equity awards or other Long-term Incentive Awards that are outstanding as of the
employment termination date.
4.3. Expiration of Term. If at the expiration of the Term, your employment shall not
have been previously terminated pursuant to the provisions of this Agreement, no Disability Period
is then in effect and the parties shall not have agreed in a signed writing to an extension or
renewal of this Agreement or on the terms of a new employment agreement, then this Agreement shall
expire and your employment shall continue on an at-will basis. As an at-will employee, upon the
termination of your
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employment
without_cause, (a) you shall be eligible for participation in any
executive-level severance plan or program offered by the Company that will provide a minimum
severance benefit equal to twelve (12) months Base Salary and Target Bonus, subject to your
execution and delivery of a full release to the Company substantially in the form attached hereto
as Annex A or such other form of release as may be implemented for such executive-level severance
plan or program, (b) you shall receive immediate vesting in full of any outstanding equity awards
or other Long-term Incentive Awards granted during the Term and any stock option awards granted
during the Term shall become immediately exercisable for the time periods set forth in the
respective stock option award agreements, and (c) any equity awards granted before the Effective
Date shall continue to vest for a period that is equal to 24 months after the date of your
termination of employment without cause (consistent with the pro-rata vesting terms set forth in
Section 7.2(e) below); provided that, any stock option awards that are scheduled to
vest on or before the end of such 24-month period shall vest upon the earlier of (i) the original
vesting date of the stock option award, (ii) your commencement of Other Employment, and (iii) the
end of such 24-month period; provided further that, vested stock options
shall remain exercisable until a date that is three years after the earlier of (x) your
commencement of Other Employment and (y) the end of such 24-month period, but not beyond the term
of such options.
4.4. Release. A condition precedent to the Company’s obligation to make the payments
associated with a termination of employment pursuant to Sections 4.2 (Termination Without Cause or
For Good Reason) and 5.1 (Disability) shall be your execution and delivery of a release of all
claims substantially in the form attached hereto as Annex A, as may be revised from time to time as
necessary to reflect changes in federal or state laws to ensure that such release is valid. Such
release must be signed by you and returned to the Company no later than 45 days after your
separation from service with the Company. If you shall fail to execute and deliver such release,
or if you revoke such release as provided therein, then you shall not be entitled to any severance
benefits provided in Section 4.2.2 or Disability Period (defined below) payments under the
Agreement and you shall reimburse the Company for any such payments made to you in anticipation of
your execution of the release or prior to the revocation of such release.
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4.5. Payments. Payments of Base Salary and Bonus required to be made to you after a
termination of employment pursuant to Sections 4, 5 or 6 shall be made at the same times as such
payments otherwise would have been paid to you pursuant to Sections 3.1 (Base Salary) and 3.2
(Bonus) if your employment had not been terminated, or such other time as required for compliance
with Code Section 409A as set forth in Section 10.15 below.
4.6. Code §§ 280G and 4999. Notwithstanding anything to the contrary contained in
this Agreement, to the extent that any amount, stock option, restricted stock, RSUs, other equity
awards or benefits paid or distributed to you pursuant to this Agreement or any other agreement or
arrangement between the Company and you (collectively, the “280G Payments”) (a) constitute a
“parachute payment” within the meaning of Section 280G of the Code and (b) but for this Section
4.6, would be subject to the excise tax imposed by Section 4999 of the Code, then the 280G Payments
shall be payable either (i) in full or (ii) in such lesser amount which would result in no portion
of such 280G Payments being subject to excise tax under Section 4999 of the Code; whichever of the
foregoing amounts, taking into account the applicable federal, state and local income or excise
taxes (including the excise tax imposed by Section 4999) results in your receipt on an after-tax
basis, of the greatest amount of benefits under this Agreement, notwithstanding that all or some
portion of such benefits may be taxable under Section 4999 of the Code. Unless you and the Company
otherwise agree in writing, any determination required under this Section shall be made in writing
by an independent public accountant selected by the Company (the “Accountants”), whose
determination shall be conclusive and binding upon you and the Company for all purposes. For
purposes of making the calculations required by this Section, the Accountants may make reasonable
assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith
interpretations concerning the application of Sections 280G and 4999 of the Code. The Company and
you shall furnish to the Accountants such information and documents as the Accountants may
reasonably request in order to make a determination under this Section. The Company shall bear all
costs the Accountants may reasonably incur in connection with any calculations contemplated by this
Section, as well as any reasonable legal or accountant expenses, or any additional taxes, that you
may incur as a result of any calculation errors made by the Accountant and/or the Company in
connection with the Code Section 4999 excise tax analysis contemplated by this Section.
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4.6.1. Additional 280G Payments. If you receive reduced 280G Payments by reason of
this Section 4.6 and it is established pursuant to a final determination of the court or an
Internal Revenue Service proceeding that you could have received a greater amount without resulting
in an excise tax, then the Company shall promptly thereafter pay you the aggregate additional
amount which could have been paid without resulting in an excise tax as soon as practicable.
4.6.2. Review of Accountant Determinations. The parties agree to cooperate generally
and in good faith with respect to (i) the review and determinations to be undertaken by the
Accountants as set forth in this Section 4.6 and (ii) any audit, claim or other proceeding brought
by the Internal Revenue Service or similar state authority to review or contest or otherwise
related to the determinations of the Accountants as provided for in this Section 4.6, including any
claim or position taken by the Internal Revenue Service that, if successful, would require the
payment by you of any additional excise tax, over and above the amounts of excise tax established
under the procedure set forth in this Section 4.6.
4.6.3. Order of 280G Payment Reduction. The reduction of 280G Payments, if
applicable, shall be effected in the following order (unless you, to the extent permitted by
Section 409A of the Code, elect another method of reduction by written notice to the Company prior
to the Section 280G event): (i) any cash severance payments, (ii) any other cash amounts payable to
you, (iii) any health and welfare or similar benefits valued as parachute payments, (iv)
acceleration of vesting of any stock options for which the exercise price exceeds the then fair
market value of the underlying stock, in order of the option tranches with the largest Section 280G
parachute value, (v) acceleration of vesting of any equity award that is not a stock option and
(vi) acceleration of vesting of any stock options for which the exercise price is less than the
fair market value of the underlying stock in such manner as would net you the largest remaining
spread value if the options were all exercised as of the Section 280G event.
5. Disability.
5.1. Disability Payments. If during the Term and prior to the delivery of any notice
of termination of employment pursuant to Section 4, you become
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physically or mentally disabled, whether totally or partially, so that you are unable to
engage in substantial gainful activity by reason of any medically determinable physical or mental
impairment, which can be expected to result in death or can be expected to last for a continuous
period of not less than twelve (12) months, the Company shall, nevertheless, continue to pay your
full compensation (including Bonus) through the last day of the sixth consecutive month of
disability or the date on which any shorter periods of disability shall have equaled a total of six
months in any twelve-month period (such last day or date being referred to herein as the
“Disability Date”), in lieu of or offset by any payments received by you from Worker’s Compensation
insurance, Social Security, and short- or long-term disability insurance benefits maintained by the
Company; provided that, if you die prior to the Disability Date, you are not entitled to any
further payments after such date, except as provided in Section 6 below. If you have not resumed
your usual duties on or prior to the Disability Date, the Company shall terminate your employment
effective as of the Disability Date and pay you a pro rata Bonus based on actual achievement of the
performance criteria established for the Company, provided that your individual performance score
shall be equal to the Company’s performance score, for the year in which the Disability Date
occurs. Thereafter the Company shall pay you disability benefits for a period of time equal to the
Severance Period defined in Section 4.2.2 (the “Disability Period”), in an annual amount equal to
75% of your Base Salary and Target Bonus in effect as of the Disability Date. All payments
pursuant to this Section 5.1 shall be made at the times specified in Section 4.5 (Payments).
5.2. Recovery From Disability. If during the Disability Period you shall fully
recover from your disability, the Company shall have the right (exercisable within 60 days after
notice from you of such recovery), but not the obligation, to reinstate you to full-time employment
at your compensation rate in effect as of the Disability Date. If the Company elects to rehire
you, then the Disability Period payments described in Section 5.1 shall cease and this Agreement
shall be reinstated in all respects and the Term shall not be extended by virtue of the occurrence
of the Disability Period. If the Company elects not to rehire you, during any balance of your
Disability Period, you shall be entitled to receipt of the payments described in Section 5.1 and
you may obtain Other Employment, subject, however, to the following: (i) you shall perform
advisory services to the Company during any balance of the Disability Period and (ii) you shall not
be entitled to the post-termination health and welfare benefits provided in Section 7.2 if you
obtain Other Employment during the balance of your
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Disability Period. The advisory services referred to in clause (i) of the immediately
preceding sentence shall consist of rendering advice concerning strategic matters as requested by
the Company, but you shall not be required to devote more than five days (up to eight hours per
day) each month to such services, which shall be performed at a time and place mutually convenient
to both parties. Any income from any Other Employment you may obtain during the balance of the
Disability Period shall not be applied to reduce the Company’s obligations under this Agreement.
5.3. Other Disability Provisions. The Company shall be entitled to deduct from all
payments to be made to you during the Disability Period pursuant to this Section 5 an amount equal
to all disability payments received by you during the Disability Period from any Worker’s
Compensation insurance, Social Security and short- or long-term disability insurance benefits
maintained by the Company; provided, however, that for so long as, and to the extent that, proceeds
paid to you from such disability insurance policies are not includible in your income for federal
income tax purposes, the Company’s deduction with respect to such payments shall be equal to the
product of (i) such payments and (ii) a fraction, the numerator of which is one and the denominator
of which is one less the maximum marginal rate of federal income taxes applicable to individuals at
the time of receipt of such payments. For purposes of clarity, you acknowledge and agree that
Sections 4.2 (Termination Without Cause or For Good Reason) and 4.3 (Expiration of Term) shall not
apply during the Disability Period and you shall not be entitled to any other notice and severance
benefits under this Agreement or otherwise, or to receive or be paid for any accrued vacation time
or unused sabbatical, unless payment of such accrued, but unused vacation benefits is otherwise
required by state law. Notwithstanding the foregoing, if you die during the Disability Period, the
payments provided for in Section 5.1 shall immediately cease and your estate (or designated
beneficiary(ies)) shall not be entitled to any further payments; provided that, you shall be
entitled to 75% of a prorated Target Bonus for the year in which your death occurs, based on the
number of whole or partial months in such calendar year prior to the date of your death, as
determined by the Company in its sole discretion.
6. Death. If you die during the Term, this Agreement and all obligations of the
Company to make any payments hereunder shall terminate except that your estate (or a designated
beneficiary) shall be entitled to receive Base Salary to the last day of the month in which your
death occurs and Bonus compensation (at the time
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bonuses are normally paid) based on the actual achievement of the performance criteria
established for the Company, provided that your individual performance score shall be equal to the
Company’s performance score, but prorated according to the number of whole or partial months you
were employed by the Company in such calendar year.
7. Other Benefits.
7.1. Generally Available Benefits. To the extent that (a) you are eligible under the
general provisions thereof (including without limitation, any plan provision providing for
participation to be limited to persons who were employees of the Company or certain of its
subsidiaries prior to a specific point in time) and (b) the Company maintains such plan or program
for the benefit of its executives, during the Term and so long as you are an employee of the
Company, you shall be eligible to participate in any pension, excess plan, savings or similar plan
or program, group life insurance, hospitalization, medical, vision, dental, accident, disability or
similar plan or program, financial counseling reimbursement, and courtesy services of the Company
now existing or established hereafter for similarly situated executives.
7.1.1. Life Insurance. During the Term, the Company shall (i) provide you with
$50,000 of group life insurance and (ii) pay you annually an amount equal to two times the premium
you would have to pay to obtain life insurance under the Group Universal Life (“GUL”) insurance
program made available by the Company in an amount equal to $2,000,000. You shall be under no
obligation to use the payments made by the Company pursuant to the preceding sentence to purchase
GUL insurance or to purchase any other life insurance. If the Company discontinues its GUL
insurance program, the Company shall nevertheless make the payments required by this Section 7.1.1
as if such program were still in effect. The payments made to you hereunder shall not be
considered as “salary” or “compensation” or “bonus” in determining the amount of any payment under
any pension, retirement, profit-sharing or other benefit plan of the Company or any subsidiary of
the Company. The payments required by this Section 7.1.1 will be paid to you no later than March
15 following the calendar year to which it relates.
7.2. Benefits After a Termination or Disability. During the Severance Period or the
Disability Period, unless you accept Other Employment as
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described in Sections 4.2.2 (Severance Benefits) or 5.2 (Recovery From Disability), you shall
continue to be eligible to participate in the Company’s health and welfare benefit plans, or
comparable arrangements that may be implemented for former employees covered by severance
arrangements, to the extent such benefits are maintained in effect by the Company for its
executives; provided, however, (a) you shall not be entitled to any additional awards or grants
under any stock option, restricted stock, RSU or other stock based incentive plan or Additional
Compensation Plans, (b) any equity awards granted before January 1, 2010 that would have vested on
or before the end of the Severance Period or Disability Period shall continue to vest during the
Severance Period or Disability Period (consistent with the pro-rata vesting terms set forth in
Section 7.2(e) below); provided that, any stock option awards that are scheduled to
vest on or before the end of the Severance Period or Disability Period shall vest upon the earlier
of (i) the original vesting date of the stock option award, (ii) your commencement of Other
Employment, and (iii) the end of the Severance Period or Disability Period; provided
further that, vested stock options shall remain exercisable until a date that is
three years after the earlier of (x) your commencement of Other Employment and (y) the end of the
Severance Period or Disability Period, but not beyond the term of such options, (c) any equity
awards or other Long-term Incentive Awards granted on or after the Effective Date and during the
Term, shall be subject to the terms and conditions of the respective award agreements and the
vesting provisions set forth in Section 4.2.2 and this Section 7.2, (d) during the Term, the
Company shall not be permitted to determine that your employment was terminated for “unsatisfactory
performance” within the meaning of any stock option, restricted stock, RSU, or other equity
compensation agreement between you and the Company, provided that such determination is permitted
by applicable law, and (e) for purposes of determining whether any equity based award granted
before January 1, 2010 would have vested on or before the end of the Severance Period (as
contemplated in clause (b) above), such equity based award(s) shall be deemed to vest pro rata over
the applicable vesting period notwithstanding any inconsistent provisions in the plan or agreement
under which it was granted. Effective with your termination of employment pursuant to Sections 4,
5 or 6, you will no longer be permitted to contribute to or receive a Company match in the TWC
Savings Plan, or any successor plan, and you will no longer accrue benefit service under the Time
Warner Cable Pension Plan or the Time Warner Cable Excess Benefit Pension Plan, or any successor
plans, and your rights under those plans will be determined in accordance with the terms of those
plans and applicable law. Unless otherwise stated in this Agreement, your rights to benefits and
payments
14
under any benefit plans or any insurance or other death benefit plans or arrangements of the
Company or under any stock option, restricted stock, RSU, or other equity compensation, Additional
Compensation Plans, or any management incentive or other plan of the Company shall be determined in
accordance with the terms and provisions of such plans and any related award agreements.
Notwithstanding the foregoing, your continued participation in the Company’s benefit plans shall be
subject to the limitations of applicable law.
7.3. Payments in Lieu of Other Benefits. In the event your employment with the
Company is terminated pursuant to any section of this Agreement, you shall not be entitled to
notice and severance under the Company’s general employee policies or other executive severance
plans or programs, or to be paid for any accrued vacation time or unused sabbatical (unless payment
of such accrued, but unused vacation benefits is otherwise required by state law), the payments
provided for in such sections in this Agreement being in lieu thereof.
8. Restrictive Covenants.
8.1. Confidentiality Covenant. You acknowledge that your employment by the Company
will, throughout the term of your employment, bring you into close contact with many confidential
affairs of the Company, its affiliates and third parties doing business with the Company, including
information about costs, profits, markets, sales, products, key personnel, pricing policies,
operational methods, technical processes and other business affairs and methods and other
information not readily available to the public, and plans for future development. You further
acknowledge that the services to be performed under this Agreement are of a special, unique,
unusual, extraordinary and intellectual character. You further acknowledge that the business of
the Company and its affiliates is international in scope, that its products and services are
marketed throughout the world, that the Company and its affiliates compete in nearly all of its
business activities with other entities that are or could be located in nearly any part of the
world and that the nature of your services, position and expertise are such that you are capable of
competing with the Company and its affiliates from nearly any location in the world. In
recognition of the foregoing, you covenant and agree:
15
8.1.1. You shall use all reasonable efforts to keep secret all confidential matters of the
Company, its affiliates and third parties and shall not disclose such matters to anyone outside of
the Company and its affiliates, or to anyone inside the Company and its affiliates who does not
have a need to know or use such information, and shall not use such information for personal
benefit or the benefit of a third party, either during or after the Term, except with the Company’s
written consent, provided that (i) you shall have no such obligation to the extent such matters are
or become publicly known other than as a result of your breach of your obligations hereunder, (ii)
you may, after giving prior notice to the Company to the extent practicable under the
circumstances, disclose such matters to the extent required by applicable laws or governmental
regulations or judicial or regulatory process, and (iii) to the extent necessary to enforce the
terms of this Agreement;
8.1.2. You shall deliver promptly to the Company on termination of your employment, or at any
other time the Company may so request, all memoranda, notes, records, reports and other documents
(and all copies thereof) relating to the Company’s and its affiliates’ businesses, which you
obtained while employed by, or otherwise serving or acting on behalf of, the Company and which you
may then possess or have under your control; and
8.2. Non-solicitation. During your employment with the Company and its affiliates,
and if your employment terminates for any reason, whether during or after the Term, including your
voluntary resignation or retirement, for a period of one year after such termination, without the
prior written consent of the Company, you shall not directly or indirectly, (i) solicit, induce,
encourage or attempt to influence any customer, independent contractor, joint venturer or supplier
of the Company to cease to do business with or to otherwise terminate his, her or its relationship
with the Company, (ii) solicit or hire or cause any entity of which you are an affiliate to solicit
or hire, any person who was a full-time employee of the Company at the date of your termination of
employment or within six months prior thereto, but such prohibition shall not apply to your
secretary or executive assistant, any other employee eligible to receive overtime pay or any former
employee of the Company who was terminated involuntarily by the Company, so long as you were not,
directly or indirectly, involved in the circumstances giving rise to such termination. Nothing in
this Section 8.2 shall restrict your ability to
16
engage in general advertising not targeted at Company employees or serve as a reference for an
employee with regard to an entity with which you are not affiliated.
8.3. Non-disparagement. During your employment with the Company and its affiliates,
and if your employment terminates for any reason, whether during or after the Term, including your
voluntary resignation or retirement, for a period of one year after such termination, you shall
not, directly or indirectly, disparage, make negative statements about or act in any manner which
is intended to damage the goodwill of, or the business or personal reputations of the Company or
any of its affiliates, or those individuals who serve or served as an officer or director of the
Company or any of its affiliates on or after the Effective Date. Nothing in this Section 8.3 shall
prohibit or bar you from providing truthful testimony in any legal proceeding, making any truthful
disclosure required under law or from enforcing any rights under this Agreement.
8.4. Non-compete. During your employment with the Company and its affiliates, and if
your employment terminates for any reason, whether during or after the Term, including your
voluntary resignation or retirement, for a period of time equal to the Severance Period defined in
Section 4.2.2 (whether or not you are eligible for or receive any severance benefits under Section
4.2.2) or, if you are employed at will, 12 months after your termination of employment for any
reason (the “Non-compete Period”), you shall not, directly or indirectly, without the prior written
consent of the Chief Executive Officer of the Company, render any services to, or act in any
capacity for, any Competitive Entity, or acquire any interest of any type in any Competitive
Entity; provided, however, that the foregoing shall not be deemed to prohibit you from acquiring,
(a) solely as an investment and through market purchases, securities of any Competitive Entity
which are registered under Section 12(b) or 12(g) of the Securities Exchange Act of 1934 and which
are publicly traded, so long as you are not part of any control group of such Competitive Entity
and such securities, including converted securities, do not constitute more than one percent (1%)
of the outstanding voting power of that entity and (b) securities of any Competitive Entity that
are not publicly traded, so long as you are not part of any control group of such Competitive
Entity and such securities, including converted securities, do not constitute more than three
percent (3%) of the outstanding voting power of that entity. For purposes of the foregoing, the
following shall be deemed to be a Competitive Entity: (i) any United States based entity a material
portion of the business of which is any line of business that
17
comprises a material portion of the business in which the Company engages in, conducts or, to
your knowledge, has definitive plans to engage in or conduct and that the Company reasonably
expects will comprise a material portion of its business within the succeeding 12 months, whether
that business is conducted directly by such entity or a subsidiary of such entity (a “Covered
Business”); provided that, you may be employed by or provide services to an ultimate parent company
that owns a subsidiary which is materially engaged in a Covered Business, so long as you
demonstrate to the Company’s reasonable satisfaction (e.g. represent and warrant to the Company in
writing and describe the nature of your responsibilities) that you do not and will not, directly or
indirectly, provide any services or advice to, have any responsibility for, or supervision of, any
subsidiary materially engaged in a Covered Business, (ii) any entity which has a material
commercial relationship with the Company and could reasonably derive a material unfair advantage in
dealings with the Company because of confidential information you possess about the Company’s
products, services, business strategies, financial condition, terms of agreements or other
information, or (iii) any operating business that is engaged in or conducted by the Company as to
which, to your knowledge, the Company covenants, in writing, not to compete with in connection with
the disposition of such business; provided that, this Section 8.4 (iii) shall only apply during
your active employment with the Company and its affiliates. In evaluating any requests for written
consent of the Chief Executive Officer of the Company to be relieved, in whole or in part, of your
obligations under this Section 8.4, the Chief Executive Officer shall consider the nature of your
position with the Company, the confidential and proprietary information to which you were privy
during the course of your employment with the Company, the nature of the employment and position
you are seeking with a Competitive Entity, the extent to which you can perform services for any
such Competitive Entity without disclosing, using or putting at risk any trade secrets or
confidential, proprietary information of the Company, and any other relevant factors, in all
instances looking to make decisions that reasonably and properly protect the trade secrets and
other confidential, proprietary information of the Company.
8.5. Ownership of Work Product. You acknowledge that during your employment, you may
conceive of, discover, invent or create inventions, improvements, new contributions, literary
property, material, ideas and discoveries, whether patentable or copyrightable or not (all of the
foregoing being collectively referred to herein as “Work Product”), and that various business
opportunities shall be
18
presented to you by reason of your employment by the Company. You acknowledge that all of the
foregoing shall be owned by and belong exclusively to the Company and that you shall have no
personal interest therein, provided that they are either related in any manner to the business
(commercial or experimental) of the Company, or are, in the case of Work Product, conceived or made
on the Company’s time or with the use of the Company’s facilities or materials, or, in the case of
business opportunities, are presented to you for the possible interest or participation of the
Company. You shall (i) promptly disclose any such Work Product and business opportunities to the
Company; (ii) assign to the Company, upon request and without additional compensation, the entire
rights to such Work Product and business opportunities; (iii) sign all papers necessary to carry
out the foregoing; and (iv) give testimony in support of your inventorship or creation in any
appropriate case. You agree that you will not assert any rights to any Work Product or business
opportunity as having been made or acquired by you prior to the date of this Agreement except for
Work Product or business opportunities, if any, disclosed to and acknowledged by the Company in
writing prior to the date hereof.
8.6. Reasonable Restrictive Covenants. You acknowledge that the restrictions
contained in this Section 8, in light of the nature of the Company’s business and your position and
responsibilities, are reasonable and necessary to protect the legitimate interests of the Company.
You further acknowledge that the restrictions contained in this Section 8 shall survive the
termination of your employment as provided in Section 10.13 (Survival), including your voluntary
resignation or retirement, and/or the expiration or termination of this Agreement.
9. Notices. All notices, requests, consents and other communications required or
permitted to be given under this Agreement shall be effective only if given in writing and shall be
deemed to have been duly given if delivered personally or sent by a nationally recognized overnight
delivery service, or mailed first-class, postage prepaid, by registered or certified mail, as
follows (or to such other or additional address as either party shall designate by notice in
writing to the other in accordance herewith):
9.1. If to the Company:
19
Attention: General Counsel
With a copy to:
Time Warner Cable Inc.
0000 Xxxxxxxx Xxxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Group Vice President, Compensation & Benefits
0000 Xxxxxxxx Xxxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Group Vice President, Compensation & Benefits
9.2. If to you, to your residence address set forth in the payroll records of the Company.
10. General.
10.1. Governing Law. This Agreement shall be governed by and construed and enforced
in accordance with the substantive laws of the State of New York, without regard to its conflict of
laws rules, as applicable to agreements made and to be performed entirely in New York.
10.2. Captions. The section headings contained herein are for reference purposes
only and shall not in any way affect the meaning or interpretation of this Agreement.
10.3. No Other Representations. No representation, promise or inducement has been
made by either party that is not embodied in this Agreement, and neither party shall be bound by or
be liable for any alleged representation, promise or inducement not so set forth.
10.4. Assignability. This Agreement and your rights and obligations hereunder may
not be assigned by you and except as specifically contemplated in this Agreement, neither you, your
legal representative nor any beneficiary designated by you shall have any right, without the prior
written consent of the Company, to assign, transfer, pledge, hypothecate, anticipate or commute to
any person or entity any payment due in the future pursuant to any provision of this Agreement, and
any attempt to do so shall be void and shall not be recognized by the Company. The Company shall
assign its rights together with its obligations hereunder in connection with any sale, transfer or
other disposition of all or substantially all of the
20
Company’s business and assets, whether by merger, purchase of stock or assets or otherwise, as
the case may be. Upon any such assignment, the Company shall cause any such successor expressly to
assume such obligations, and such rights and obligations shall inure to and be binding upon any
such successor.
10.5. Amendments; Waivers. This Agreement may be amended, modified, superseded,
cancelled, renewed or extended and the terms or covenants hereof may be waived only by written
instrument executed by both of the parties hereto, or in the case of a waiver, by the party waiving
compliance. The failure of either party at any time or times to require performance of any
provision hereof shall in no manner affect such party’s right at a later time to enforce the same.
No waiver by either party of the breach of any term or covenant contained in this Agreement, in any
one or more instances, shall be deemed to be, or construed as, a further or continuing waiver of
any such breach, or a waiver of the breach of any other term or covenant contained in this
Agreement.
10.6. Remedies.
10.6.1. Specific Remedies. In addition to such other rights and remedies as the
Company may have at equity or in law with respect to any breach of this Agreement, if you commit a
material breach of any of the provisions of Section 8 (Restrictive Covenants), the Company shall
have the right and remedy to have such provisions specifically enforced by any court having equity
jurisdiction, it being acknowledged and agreed that any such breach or threatened breach will cause
irreparable injury to the Company; provided that for the non-compete covenant set forth in Section
8.4, the right to specific enforcement shall only apply to the first twelve months of the
Non-compete Period. Upon a judicial determination that any of the restrictive covenants set forth
in Section 8 are overbroad in duration or scope, this Agreement shall be deemed to be modified so
as to effect the original intent of the parties as closely as possible to the end that the
restrictive covenants contemplated in Section 8 are fulfilled to the greatest extent possible.
10.6.2. Reduction of Severance Payments. Notwithstanding any provision of this
Agreement to the contrary, if you breach any of the provisions of Section 8 during the relevant
restricted periods provided for therein, as determined by the Company, all payment and other
obligations of the Company pursuant
21
to Sections 4.2.2 (Severance Benefits), 4.2.3 (Termination Upon CIC), 5.1 (Disability
Payments) or 7.2 (Benefits After Termination) shall cease as of the date of the breach and you
agree to forfeit such payments and obligations while in breach of the provisions of Section 8;
provided that, the balance of any remaining payments or other obligations due you pursuant to
Sections 4.2.2, 4.2.3, 5.1 or 7.2, if any, shall be provided to you as scheduled if you cease to
engage in the conduct that violates the provisions of Section 8 (whether at the request of the
Company, as the result of an injunction or otherwise). Nothing in this Section 10.6.2 shall limit
your repayment obligations to the Company, if any, under Section 10.6.3 below.
10.6.3. Incentive Compensation Forfeiture. In addition to the injunctive remedies
available to the Company pursuant to Section 10.6.1 above, you agree that in the event of the
termination of your employment for a “Covered Cause Event” (as defined below, and each a
“Forfeiture Event”), the Company shall be entitled to the following additional remedies: (a) your
options and any other equity or cash-based awards granted on or after the Effective Date and within
one year of the occurrence of the Covered Cause Event shall be subject to the forfeiture and
repayment conditions set forth on Annex B to this Agreement and (b) you shall repay to the Company,
within sixty (60) days of written demand, all Base Salary and Bonus previously paid to you in
respect of a period during which you engaged in the conduct giving rise to the Covered Cause Event.
Notwithstanding any of the foregoing, the Board or committee to whom the Board has delegated such
matters shall retain sole discretion regarding whether to seek the remedies set forth in this
Section 10.6.3 and in Section 10.6.4. For purposes of this Section 10.6.3, (I) a “Covered Cause
Event” shall mean any conduct and/or activity falling within Sections 4.1.1 (a), (c), (d) and (e)
(other than a breach of Section 8.2 hereof or a non-material breach of Sections 8.1hereof) of the
definition of “cause,” (II) the reference to “felony” in 4.1.1 (a) shall be limited solely to any
acts or omissions arising in the performance of your duties and responsibilities for, or matters
involving the assets or property of, the Company or its affiliates and (III) for purposes of this
Section 10.6.3, no act or failure to act will be considered “willful” with respect to “cause”
unless it has been done, or omitted to be done, by you in bad faith and without reasonable belief
that the action was in the best interests of the Company; provided further that any act, or failure
to act, based upon authority or instruction(s) given to you pursuant to a resolution duly adopted
by the Board, or based upon the advice of counsel for the Company, will be conclusively presumed to
be done or omitted to be done, by you in good faith and in the
22
best interests of the Company. This Section 10.6.3 and Annex B shall not apply unless the
Company gives you written notice of its exercise of its rights under this Section 10.6.3 and Annex
B within ninety (90) days of the Board becoming aware of the conduct giving rise to the Covered
Cause Event; provided that other than in the case of an ongoing course of conduct, the Company
shall provide you with written notice within eighteen (18) months of conduct giving rise to the
Covered Cause Event, or in the case of the cessation of an ongoing course of conduct, within
eighteen (18) months of such cessation, and if it fails to do so such conduct shall no longer
provide a basis for any forfeiture pursuant to this Section 10.6.3. In the event of a change of
ownership or control of the Company, or a change in the ownership of a substantial portion of the
assets of the Company (in each case as defined under Section 280G of the Code), no person or entity
acquiring such ownership or control may enforce the provisions of this Section 10.6.3 against you
if at the time of such transaction such person or entity was aware of, or reasonably should have
known of, events or circumstances that would have given the Company grounds to have terminated your
employment for a Covered Cause Event.
10.6.4. Other Forfeitures of Compensation. You hereby acknowledge and agree that you
are subject to Section 304 of the Xxxxxxxx-Xxxxx Act of 2002 (“Xxxxxxxx-Xxxxx Act”) and that
pursuant thereto you may under certain circumstances be obligated to pay back to the Company
certain amounts previously received by you. In addition, in connection with any grant, payment or
settlement made on your behalf (i.e., in connection with any incentive and/or performance based
compensation), based in whole or in part on the financial performance criteria of the Company, or
any division thereof, that are subsequently determined by the Board or a committee thereof to be
materially incorrect, you hereby agree that you shall pay back to the Company upon request of the
Board, the Board’s audit committee, or a committee of independent Board members, within sixty (60)
days of written demand, amounts previously received by you as bonuses or other incentive or equity
compensation, equal to the amount by which your compensation would have been reduced net of any
additional amounts that would have been due to you (in respect of the same years or different
years) had the performance criteria been applied correctly; it being understood that you shall
retain any such remaining compensation attributable to the correct application of such performance
criteria. Notwithstanding anything herein to the
23
contrary, no amount shall be repaid by you more than once under Section 10.6.3 and this
Section 10.6.4.
10.6.4.1. Tax Liabilities with Respect to Forfeitures of Reimbursement Obligations.
Except to the extent required under the Xxxxxxxx-Xxxxx Act, repayments to the Company of amounts
previously paid to you or of gain realized by you in connection with any option or equity award, as
may be provided for in Sections 10.6.3 and 10.6.4 and Annex B, shall be reduced by the Net Tax Cost
of amounts of previously paid compensation and/or gain, so that you shall not be required to pay to
the Company amounts in excess of the amounts received by you on an “after tax” basis. “Net Tax
Cost” shall mean the net amount of any federal, foreign, state or local income and employment taxes
paid by you in respect of the compensation or gain received that is subject to reimbursement, after
taking into account any and all available deductions, credits or other offsets allowable to you
(including, without limitation, any deduction permitted under the claim of right doctrine), and
regardless of whether you would be required to amend any prior income or other tax returns, subject
to your documentation that deductions, credits or other offsets otherwise available or allowable to
you could not be used as a result of your actual tax position.
10.6.4.2. Incentive Compensation Forfeiture Offset. Notwithstanding any other
provision of this Agreement to the contrary, and to the extent permitted by applicable law, the
Company shall have the right to offset against any amounts owed to you by the Company any repayment
obligations or liabilities that you may have under Sections 10.6.3 and 10.6.4 and Annex B of this
Agreement.
10.7. Resolution of Disputes. Except as provided in the preceding Section 10.6
(Remedies), any dispute or controversy arising with respect to this Agreement and your employment
hereunder (whether based on contract or tort or upon any federal, state or local statute, including
but not limited to claims asserted under the Age Discrimination in Employment Act, Title VII of the
Civil Rights Act of 1964, as amended, any state Fair Employment Practices Act and/or the Americans
with Disability Act) shall, at the election of either you or the Company, be submitted to JAMS for
resolution in arbitration in accordance with the rules and procedures of JAMS. Either party shall
make such election by delivering written notice thereof to the other party at any time (but not
later than 45 days after such party receives notice of the
24
commencement of any administrative or regulatory proceeding or the filing of any lawsuit
relating to any such dispute or controversy) and thereupon any such dispute or controversy shall be
resolved only in accordance with the provisions of this Section 10.7. Any such proceedings shall
take place in New York, New York before a single arbitrator (rather than a panel of arbitrators),
pursuant to any streamlined or expedited (rather than a comprehensive) arbitration process, before
a non-judicial (rather than a judicial) arbitrator, and in accordance with an arbitration process
which, in the judgment of such arbitrator, shall have the effect of reasonably limiting or reducing
the cost of such arbitration. The resolution of any such dispute or controversy by the arbitrator
appointed in accordance with the procedures of JAMS shall be final and binding. Judgment upon the
award rendered by such arbitrator may be entered in any court having jurisdiction thereof, and the
parties consent to the jurisdiction of the New York courts for this purpose. If you shall be the
prevailing party in such arbitration, the Company shall promptly pay, upon your demand, all
reasonable legal fees, court costs and other reasonable costs and expenses incurred by you in any
legal action seeking to enforce the award in any court.
10.8. Beneficiaries. Whenever this Agreement provides for any payment to your
estate, such payment may be made instead to such beneficiary or beneficiaries as you may designate
by written notice to the Company. You shall have the right to revoke any such designation and to
redesignate a beneficiary or beneficiaries by written notice to the Company (and to any applicable
insurance company) to such effect.
10.9. No Conflict. You represent and warrant to the Company that this Agreement is
legal, valid and binding upon you and the execution of this Agreement and the performance of your
obligations hereunder does not and will not constitute a breach of, or conflict with the terms or
provisions of, any agreement or understanding to which you are a party (including, without
limitation, any other employment agreement). The Company represents and warrants to you that this
Agreement is legal, valid and binding upon the Company and the execution of this Agreement and the
performance of the Company’s obligations hereunder does not and will not constitute a breach of, or
conflict with the terms or provisions of, any agreement or understanding to which the Company is a
party.
25
10.10. Withholding Taxes. Payments made to you pursuant to this Agreement shall be
subject to withholding and social security taxes and other ordinary and customary payroll
deductions.
10.11. Offset. Except as provided in Sections 5.1 (Disability Payments), 10.6.4.2
(Incentive Compensation Forfeiture Offset) and the Company’s general right to offset any payments
received by you under this Agreement by any disability benefits you may receive during the Term or
any Severance Period from Worker’s Compensation insurance, Social Security disability, and short-
and long-term disability insurance benefits maintained by the Company, neither you nor the Company
shall have any right to offset any amounts owed by one party hereunder against amounts owed or
claimed to be owed to such party, whether pursuant to this Agreement or otherwise, and you and the
Company shall make all the payments provided for in this Agreement in a timely manner.
10.12. Severability. If any provision of this Agreement shall be held invalid, the
remainder of this Agreement shall not be affected thereby; provided, however, that the parties
shall negotiate in good faith with respect to equitable modification of the provision or
application thereof held to be invalid. To the extent that it may effectively do so under
applicable law, each party hereby waives any provision of law which renders any provision of this
Agreement invalid, illegal or unenforceable in any respect.
10.13. Survival.
10.13.1. Sections 3.5 (Indemnification), 4.5 (Payments), 4.6 (Code §280G), 8 (Restrictive
Covenants), 9 (Notices) and 10 (General) shall survive any termination of your employment by the
Company for cause or your voluntary resignation pursuant to Section 4.1 and the expiration of the
Term pursuant to Section 4.3.
10.13.2. Sections 3.5, 4.4 (Release), 4.5, 4.6, 7.2 (Benefits After Term), 8, 9 and 10 shall
survive any termination of your employment by the Company without cause, by you for Good Reason, or
due to your disability pursuant to Sections 4.2 or 5.
26
10.13.3. If your employment continues after the Term on an at-will basis, Sections 4.3(a),
4.3(b) and 4.3(c) shall survive the termination of this Agreement.
10.14. Key Definitions. The following terms are defined in this Agreement in the
places indicated:
280G Payments – Section 4.6
Additional Compensation Plans – Section 3.4
affiliate – Section 4.2.2.1
Base Salary – Section 3.1
Bonus – Section 3.2
cause – Section 4.1.1
Change In Control – Section 4.2.3
CIC Agreement – Section 4.2.3
Competitive Entity – Section 8.4
Covered Business – Section 8.4
Covered Cause Event – Section 10.6.3
Disability Date – Section 5.1
Disability Period – Section 5.1
Forfeiture Event – Section 10.6.3
Good Reason – Section 4.2
Limited Vicarious Liability – Section 4.1.1
Long-term Incentive Awards – Section 3.3
Net Tax Cost – Section 10.6.4.1
Non-compete Period – Section 8.4
Other Employment – Section 4.2.2.1
Severance Period – Section 4.2.2
Stock Plan – Section 4.2.3
Target Bonus – Section 3.2
Term – Section 1
Work Product – Section 8.5
Additional Compensation Plans – Section 3.4
affiliate – Section 4.2.2.1
Base Salary – Section 3.1
Bonus – Section 3.2
cause – Section 4.1.1
Change In Control – Section 4.2.3
CIC Agreement – Section 4.2.3
Competitive Entity – Section 8.4
Covered Business – Section 8.4
Covered Cause Event – Section 10.6.3
Disability Date – Section 5.1
Disability Period – Section 5.1
Forfeiture Event – Section 10.6.3
Good Reason – Section 4.2
Limited Vicarious Liability – Section 4.1.1
Long-term Incentive Awards – Section 3.3
Net Tax Cost – Section 10.6.4.1
Non-compete Period – Section 8.4
Other Employment – Section 4.2.2.1
Severance Period – Section 4.2.2
Stock Plan – Section 4.2.3
Target Bonus – Section 3.2
Term – Section 1
Work Product – Section 8.5
10.15. Compliance With Section 409A. This Agreement is intended to comply with
Section 409A of the Code and will be interpreted, administered and operated in a manner consistent
with that intent. Notwithstanding anything herein to the contrary, if at the time of your
separation from service with the Company you are a “specified employee” as defined in Section 409A
of the Code (and the regulations thereunder) and any payments or benefits otherwise payable
hereunder as a result of such separation from service are subject to Section 409A of the Code, then
the Company will
27
defer the commencement of the payment of any such payments or benefits hereunder (without any
reduction in such payments or benefits ultimately paid or provided to you) until the date that is
six months following your separation from service with the Company (or the earliest date as is
permitted under Section 409A of the Code), and the Company will pay any such delayed amounts in a
lump sum at such time. If any other payments of money or other benefits due to you hereunder could
cause the application of an accelerated or additional tax under Section 409A of the Code, such
payments or other benefits shall be deferred if deferral will make such payment or other benefits
compliant under Section 409A of the Code, or otherwise such payment or other benefits shall be
restructured, to the extent possible, in a manner, determined by the Company, that does not cause
such an accelerated or additional tax. To the extent any reimbursements or in-kind benefits due to
you under this Agreement constitute “deferred compensation” under Section 409A of the Code, any
such reimbursements or in-kind benefits shall be paid to you in a manner consistent with Treas.
Reg. Section 1.409A-3(i)(1)(iv). Each payment made under this Agreement shall be designated as a
“separate payment” within the meaning of Section 409A of the Code. References to “termination of
employment” and similar terms used in this Agreement are intended to refer to “separation from
service” within the meaning of Section 409A of the Code to the extent necessary to comply with
Section 409A of the Code. The Company shall consult with you in good faith regarding the
implementation of the provisions of this Section 10.15; provided that neither the Company nor any
of its employees or representatives shall have any liability to you with respect to thereto.
10.16. Entire Agreement. This Agreement sets forth the entire agreement and
understanding of the parties relating to the subject matter of this Agreement and supersedes all
prior agreements, arrangements and understandings, written or oral, between the parties.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first above
written.
TIME WARNER CABLE INC. |
||||
| By: | /s/ Xxxx Xxxxxxxx-Xxxxxxxxx | |||
| XXXX XXXXXXXX-XXXXXXXXX | ||||
| EXECUTIVE VICE PRESIDENT, GENERAL COUNSEL & SECRETARY |
||||
Agreed to by: EXECUTIVE |
||||
| /s/ Xxxxxx X. Xxxxxx | ||||
| XXXXXX X. XXXXXX | ||||
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ANNEX A
RELEASE
Pursuant to the terms of the Employment Agreement made as of , between TIME
WARNER CABLE INC. (the “Company”) and the undersigned (the “Agreement”), and in consideration of
the payments made to me and other benefits to be received by me pursuant thereto, I, [Name], being
of lawful age, do hereby release and forever discharge the Company and any successors,
subsidiaries, affiliates, related entities, predecessors, merged entities and parent entities and
their respective officers, directors, shareholders, employees, benefit plan administrators and
trustees, agents, attorneys, insurers, representatives, affiliates, successors and assigns from any
and all actions, causes of action, claims, or demands for general, special or punitive damages,
attorney’s fees, expenses, or other compensation or damages (collectively, “Claims”), which in any
way relate to or arise out of my employment with the Company or any of its subsidiaries or the
termination of such employment, which I may now or hereafter have under any federal, state or local
law, regulation or order, including without limitation, Claims related to any equity awards held by
me or granted to me by the Company that are scheduled to vest subsequent to my termination of
employment (except for those equity awards scheduled to vest after the date of my termination
pursuant to Section 7.2(b) of the Agreement) and Claims under the Age Discrimination in Employment
Act (with the exception of Claims that may arise after the date I sign this Release), Title VII of
the Civil Rights Act of 1964, the Americans with Disabilities Act, the Fair Labor Standards Act,
the Family and Medical Leave Act, the Worker Adjustment Retraining and Notification Act, the
Employee Retirement Income Security Act, the New York State Human Rights Law, the New York City
Human Rights Law (each as amended through and including the date of this Release); as well as any
other claims under state contract or tort law, including, but not limited to, claims for employment
discrimination, wrongful termination, constructive termination, violation of public policy, breach
of any express or implied contract, breach of any implied covenant, fraud, intentional or negligent
misrepresentation, emotional distress, slander, and invasion of privacy; provided, however, that
the execution of this Release shall not prevent the undersigned from bringing a lawsuit against the
Company to enforce its obligations under the Agreement; provided further, that the execution of
this Release does not release any rights I may have against the Company for indemnification under
the Agreement or any other agreement, plan or arrangement.
I acknowledge that I have been given at least forty-five (45) days from the day I received a
copy of this Release to sign it and that I have been advised to consult an attorney. I understand
that I have the right to revoke my consent to this Release for seven (7) days following my signing.
This
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Release shall not become effective or enforceable until the expiration of the seven-day period
following the date it is signed by me.
I ALSO ACKNOWLEDGE THAT BY SIGNING THIS RELEASE I MAY BE GIVING UP VALUABLE LEGAL RIGHTS AND
THAT I HAVE BEEN ADVISED TO CONSULT A LAWYER BEFORE SIGNING. I further state that I have read this
document and the Agreement referred to herein, that I know the contents of both and that I have
executed the same as my own free act.
WITNESS my hand this ____ day of ___________, ____
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Annex B
Incentive Compensation Forfeiture and Repayment
As provided for in Sections 10.6.3 and 10.6.4 of this Employment Agreement, and unless
otherwise determined by the Company’s Board or a committee thereof, if the Board or a committee
thereof determines that a Forfeiture Event has occurred, the options (“Options”) or other equity
awards (“Other Equity Awards”), or other cash-based awards, in all cases subject to Section
10.6.3(a) shall be subject to the following forfeiture conditions, at the discretion of the Board
or a committee thereof, to which you, by accepting such Options or Other Equity Awards, hereby
agree:
(1) The unexercised portion of the Options and any Other Equity Awards, and any other cash-based
award, in all cases not otherwise settled or paid (in each case, both unvested and vested, if any)
will immediately be forfeited and canceled without payment upon the occurrence of the Forfeiture
Event; and
(2) You will be obligated to repay to the Company, by certified check, within sixty (60) days after
written demand is made therefore by the Company (the “Notice Date”), an amount equal to (A) the
total amount of Award Gain (as defined herein) realized by you upon each exercise of Options and
the value you have received with respect to any settlement or payment in connection with any Other
Equity Awards, or any other cash-based award, in each case on or after the date that the acts
giving rise to the Forfeiture Event commenced or occurred (the “Forfeiture Date”), and (B) the fair
market value of all Other Equity Awards awarded to you or which have become vested, in each case on
or after the Forfeiture Date. Notwithstanding the foregoing, you may satisfy your repayment
obligations with respect to amounts owed pursuant to sub-clauses (A) and (B) by returning the
applicable Options or Other Equity Awards, or the equity acquired upon exercise of such Options or
the vesting of such Other Equity Awards to the Company. “Award Gain” shall mean the product of (x)
the fair market value per share of stock at the date of such Option exercise or exercise of Other
Equity Awards (without regard to any subsequent change in the market price of such share of stock)
minus the exercise price times (y) the number of shares as to which the Options and Other Equity
Awards were exercised at that date.
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