Time Warner Cable Inc. Performance-Based Restricted Stock Units Agreement General Terms and Conditions
EXHIBIT
10.55
Performance-Based RSU Agreement
For Use After 1/1/2011
For Use After 1/1/2011
General Terms and Conditions
WHEREAS, Time Warner Cable Inc. (the “Company”) has adopted the Plan (as defined below), the
terms of which are hereby incorporated by reference and made a part of this Performance-Based
Restricted Stock Units Agreement (the “Agreement”); and
WHEREAS, the Committee has determined that it would be in the best interests of the Company
and its stockholders to grant the restricted stock units (the “RSUs”) provided for herein
to the Participant pursuant to the Plan and the terms set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth, the parties
agree as follows:
1. Definitions. Whenever the following terms are used in this Agreement, they shall
have the meanings set forth below. Capitalized terms not otherwise defined herein shall have the
same meanings as in the Plan.
(a) “Cause” means “Cause” as defined in an employment, consulting, advisory or similar
agreement between the Company or any of its Affiliates and the Participant or, if not defined
therein or if there is no such agreement, “Cause” means the Participant’s (i) 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), (ii) willful failure or refusal without proper cause to perform such Participant’s
material duties with the Company (other than any such failure resulting from the Participant’s
total or partial incapacity due to physical or mental impairment), (iii) 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, (iv) willful and material breach of any statutory or common law duty of loyalty to the
Company having a significant adverse financial effect on the Company or a significant adverse
effect on the Company’s reputation, (v) material and willful breach of any restrictive covenants to
which the Participant is subject, including non-competition, non-solicitation, non-disparagement or
confidentiality provisions, or (vi) 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
1
effect on the Company’s reputation. The determination by the Company as to the existence of
“Cause” will be conclusive on the Participant.
(b) “Committee” means the Compensation Committee of the Board of Directors of the
Company.
(c) “Determination Date” means the date on which the Committee determines whether the
Performance Condition has been satisfied. Such date shall occur in the Determination Year.
(d) “Determination Year” means the calendar year following calendar year in which the
Date of Grant (as defined in the Notice) occurs.
(e) “Disability” means “Disability” as defined in an employment, consulting, advisory
or similar agreement between the Company or any of its Affiliates and the Participant or, if not
defined therein or if there shall be no such agreement, “Disability” of the Participant shall have
the meaning ascribed to such term in the Company’s long-term disability plan or policy, as in
effect from time to time, to the extent that either such definition also constitutes such
Participant being considered “disabled” under Section 409A(a)(2)(C) of the Code.
(f) “Good Reason” means “Good Reason” as defined in an employment, consulting,
advisory or similar agreement between the Company or any of its Affiliates and the Participant or,
if not defined therein or if there is no such agreement, “Good Reason” means, following a change of
control (i) the failure of the Company or any Affiliate to pay or cause to be paid the
Participant’s base salary or annual bonus when due or (ii) any substantial and sustained diminution
in the Participant’s authority or responsibilities materially inconsistent with the Participant’s
position; provided that either of the events described in clauses (i) and (ii) will
constitute Good Reason only if the Company fails to cure such event within thirty (30) days after
receipt from the Participant of written notice of the event which constitutes Good Reason;
provided, further, that “Good Reason” will cease to exist for an event on the
sixtieth (60th) day following the later of its occurrence or the Participant’s knowledge
thereof, unless the Participant has given the Company written notice of his or her termination of
Employment for Good Reason prior to such date.
(g) “Limited Vicarious Liability” shall mean any liability which is based on acts of
the Company for which the Participant is responsible solely as a result of Participant’s office(s)
with the Company; provided that (i) the Participant is 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 (ii) after
consulting with the Company’s counsel, the Participant reasonably believed that no law was being
violated by such acts.
(h) “Notice” means the Notice of Grant of Restricted Stock Units, which has been
provided to the Participant separately and which accompanies and forms a part of this Agreement.
2
(i) “Participant” means an individual to whom RSUs as set forth in the Notice have
been awarded pursuant to the Plan and shall have the same meaning as may be assigned to the terms
“Holder” or “Participant” in the Plan.
(j) “Performance” means the Participant’s failure to meet performance expectations, as
determined in the Company’s sole discretion, and consistent with any performance determination
under the TWC Severance Pay Plan, if applicable.
(k) “Performance Condition” means the performance-based condition to vesting specified
in the Notice. Except as specified in Section 4(d), the Performance Condition shall not be
satisfied unless and until the Committee determines that such condition is satisfied on the
Determination Date.
(l) “Plan” means the Time Warner Cable 2006 Stock Incentive Plan, as such plan may be
amended, supplemented or modified from time to time.
(m) “Retirement” means a voluntary termination of Employment by the Participant
following the attainment of (i) age 60 with ten (10) or more years of Service or (ii) age 65 with
five (5) or more years of Service; provided that, the terms of any employment, consulting, advisory
or similar agreement entered into by the Participant and the Company or an Affiliate that provides
a definition of “Retirement” relating specifically to the vesting of outstanding equity awards
granted under the Plan shall supersede this definition.
(n) “Service” means the period of time a Participant is engaged as an employee or
director (i) with the Company, (ii) with any Affiliate, or (iii) in respect to any period of time
prior to March 12, 2009, with Time Warner Inc. or any affiliate thereof (“TWX”); provided that, if
the Participant became an employee or director of the Company or any Affiliate on or after March
12, 2009, any period of time Participant was engaged by TWX shall not be counted for this
definition.
(o) “Service Condition” means the time-based service condition to vesting specified in
the Notice.
(p) “Vesting Date” means each vesting date relating to the Service Condition set forth
in the Notice.
2. Grant of Restricted Stock Units. The Company hereby grants to the Participant (the
“Award”), on the terms and conditions hereinafter set forth, the number of RSUs set forth
on the Notice. Each RSU represents the unfunded, unsecured right of the Participant to receive one
Share on the date(s) specified herein or in the Notice. RSUs do not constitute issued and
outstanding Shares for any corporate purposes and do not confer on the Participant any right to
vote on matters that are submitted to a vote of holders of Shares.
3. Dividend Equivalents and Retained Distributions. If on any date while RSUs are
outstanding hereunder the Company shall pay any regular cash dividend on the Shares, the
Participant shall be paid, for each RSU held by the Participant on the record date, an amount of
cash equal to the dividend paid on a Share (the “Dividend Equivalents”) at the time that
such dividends are paid to holders of Shares. Notwithstanding the foregoing, any Dividend
3
Equivalents payable before the Determination Date shall not be paid to the Participant at the
time dividends are paid to holders of Shares, but instead shall be accumulated and paid upon the
earlier of (a) the Determination Date, subject to satisfaction of the Performance Condition (in the
event of deemed satisfaction pursuant to Section 4(d), this date shall be a day within the
Determination Year determined by the Committee) or (b) the date the Shares subject to the RSUs are
transferred to the Participant under Section 5(b). For this purpose, Shares and Retained
Distributions shall be considered to be issued or transferred upon the Determination Date if they
are issued or transferred within sixty (60) days of the Determination Date, but no later than the
end of the Determination Year. If on any date while RSUs are outstanding hereunder the Company
shall pay any dividend other than a regular cash dividend or make any other distribution on the
Shares, the Participant shall be credited with a bookkeeping entry equivalent to such dividend or
distribution for each RSU held by the Participant on the record date for such dividend or
distribution, but the Company shall retain custody of all such dividends and distributions (the
“Retained Distributions”); provided, however, that if the Retained
Distribution relates to a dividend paid in Shares, the Participant shall receive an additional
amount of RSUs equal to the product of (i) the aggregate number of RSUs held by the Participant
pursuant to this Agreement through the related dividend record date, multiplied by (ii) the number
of Shares (including any fraction thereof) payable as a dividend on a Share. Retained Distributions
will not bear interest and will be subject to the same restrictions and payment timing as the RSUs
to which they relate.
4. Vesting and Delivery of Shares.
(a) Subject to the terms and provisions of the Plan and this Agreement, within sixty (60) days
after each Vesting Date with respect to the Award, the Company shall issue or transfer to the
Participant the number of Shares that vested on such Vesting Date as set forth on the Notice and
the Retained Distributions, if any, covered by that portion of the Award. Except as otherwise
provided in Sections 4, 5 and 6, the vesting of such RSUs and any Retained Distributions relating
thereto shall occur only if (i) the Service Condition has been satisfied by the Participant’s
continuous Employment by the Company or any of its Affiliates from the Date of Grant through the
Vesting Date and (ii) the Performance Condition has been satisfied.
(b) RSUs Extinguished. Upon each issuance or transfer of Shares in accordance with
this Agreement, a number of RSUs equal to the number of Shares issued or transferred to the
Participant shall be extinguished and such number of RSUs will not be considered to be held by the
Participant for any purpose.
(c) Fractional Shares. Upon the final issuance or transfer of Shares and Retained
Distributions, if any, to the Participant pursuant to this Agreement, in lieu of a fractional
Share, the Participant shall receive a cash payment equal to the Fair Market Value of such
fractional Share.
(d) Change in Control. Upon a Change in Control that occurs before the Determination
Date, the Performance Condition shall be deemed to be satisfied unless the Committee determines in
its sole discretion before the date of the Change in Control that the Performance Condition shall
continue to apply.
4
5. Termination of Employment.
(a) Involuntary Termination for Performance; Involuntary Termination for Cause; Voluntary
Resignation. Unless otherwise provided in an employment, consulting, advisory or similar
agreement between the Participant and the Company or an Affiliate, if the Participant’s Employment
is terminated (i) by the Company for Performance or for Cause, (ii) by the Participant other than
at a time when the Participant satisfies the requirements for Retirement, or (iii) for any other
reason not specified in clauses (b), (c), (d), (e) and (f) below prior to the Vesting Date of any
portion of the Award, then the RSUs covered by any such portion of the Award and all Retained
Distributions relating thereto shall be completely forfeited on the date of any such termination.
Any distribution made to the Participant pursuant to this Section 5(a) shall be made at the time
specified in Section 5(h).
(b) Death; Disability. In the event of the Participant’s death or Disability, then
the RSUs for which a Vesting Date has not yet occurred and all Retained Distributions relating
thereto shall, to the extent the RSUs were not extinguished prior to such death or Disability,
fully vest on the date of death or Disability and Shares subject to the RSUs and all Retained
Distributions relating thereto shall be issued or transferred to the Participant within sixty (60)
days following death or Disability.
(c) Retirement. If the Participant’s Employment is terminated by the Participant due
to his or her Retirement or by the Company or its Affiliates for any reason other than for Cause or
Performance on a date when the Participant satisfies the requirements for Retirement, then the RSUs
and all Retained Distributions relating thereto shall, to the extent the RSUs were not extinguished
prior to such termination of Employment, fully vest upon such Retirement and satisfaction of the
Performance Condition or deemed satisfaction of the Performance Condition pursuant to Section 4(d).
Shares subject to the RSUs and all Retained Distributions relating thereto shall be issued or
transferred to the Participant at the time specified in Section 5(h).
(d) Without Cause; Not For Performance. Subject to the terms of any employment,
consulting, advisory or similar agreement entered into by the Participant and the Company or an
Affiliate that provides for treatment of RSUs that is more favorable to the Participant than the
terms of this Section 5(d), if the Participant’s Employment is terminated by the Company or its
Affiliates and such termination is not for Cause, not for Performance, and not at a time when the
Participant is eligible for Retirement, then, subject to satisfaction of the Performance Condition,
the Participant will be vested upon Participant’s termination of Employment in a pro rata portion
of the RSUs and related Retained Distributions that were scheduled to vest on the next Vesting Date
following the Participant’s termination of Employment. Such pro rata portion will be determined
as follows:
(x) the number of RSUs and related Retained Distributions covered by the portion
of the Award that were scheduled to vest on such upcoming Vesting Date,
multiplied by;
5
(y) a fraction, the numerator of which shall be the number of days from
the Vesting Date immediately preceding such Vesting Date (or the Date of Grant
if there was no prior Vesting Date) during which the Participant was employed by
the Company or any Affiliate, and the denominator of which shall be the number
of days from such immediately preceding Vesting Date (or the Date of Grant if
there was no prior Vesting Date) through the next succeeding Vesting Date.
If the product of (x) and (y) results in a fractional share, such fractional share shall be rounded
to the next higher whole share. The RSUs and any related Retained Distributions shall be
completely forfeited if they are not vested under this Section 5(d). Vested Shares subject to the
RSUs and all Retained Distributions relating thereto shall be issued or transferred to the
Participant at the time specified in Section 5(h).
(e) Disposition of Affiliate. Subject to Section 5(c) (Retirement) and Section 20
(§409A Compliance), if the Affiliate with which the Participant has a service relationship ceases
to be an Affiliate due to a transfer, sale or other disposition by the Company or an Affiliate
(“Disposition”), the vesting of the RSU and the issuance of the Shares shall be governed by Section
5(d) hereof as if the Participant’s Employment terminated on the date of such Disposition;
provided however, that if such Disposition does not constitute the Participant’s separation
from service for purposes of Code Section 409A, any shares that are vested as a result of this
Section 5(e) shall not be issued until the earlier of the Vesting Date when such shares would
otherwise have been issued or the Participant’s separation from service within the meaning of Code
Section 409A.
(f) After Change in Control. Subject to Section 6, if the Participant’s Employment is
terminated by the Company or its Affiliates without Cause (whether or not due to Participant’s
Performance) or by the Participant for Good Reason, or by the Company or its Affiliates for Cause
pursuant to Sections 1(a)(ii) and 1(a)(vi), within 12 months after a Change in Control (as defined
in the Plan), to the extent the Award has not been previously canceled or forfeited, the Award will
vest in full upon such Employment termination and satisfaction of the Performance Condition or
deemed satisfaction of the Performance Condition pursuant to Section 4(d). Shares subject to the
RSUs and all Retained Distributions relating thereto shall be issued or transferred to the
Participant at the time specified in Section 5(h).
(g) Leave of Absence. For purposes of this Section 5, a temporary leave of absence
shall not constitute a termination of Employment or a failure to be continuously employed by the
Company or any Affiliate regardless of the Participant’s payroll status during such leave of
absence if such leave of absence (i) is approved in writing by the Company or any Affiliate subject
to the other terms and conditions of the Agreement and the Plan and (ii) constitutes a bona fide
leave of absence and not a separation from service under Treas. Reg. §1.409A-1(h)(1)(i). Notice of
any such approved leave of absence should be sent to the Company, but such notice shall not be
required for the leave of absence to be considered approved.
(h) Distribution Timing. Upon the Participant’s termination of Employment, the Shares
subject to the RSUs and all Retained Distributions relating thereto shall
6
be issued or transferred to the Participant upon the later of (i) such termination of
Employment or (ii) the Determination Date (which shall occur in the Determination Year),
provided that, if the Performance Condition has been deemed satisfied pursuant to
Section 4(d), then the Shares subject to the RSUs and all Retained Distributions relating thereto
shall be issued or transferred to the Participant in the Determination Year as soon as practicable
following the later of January 1 of the Determination Year or the date in the Determination Year on
which the Performance Condition is deemed satisfied. Shares and Retained Distributions shall be
considered to be issued or transferred upon termination of Employment or the Determination Date, as
applicable, if they are issued or transferred within sixty (60) days of such event,
provided that Shares and Retained Distributions to be issued or transferred upon
the Determination Date must be issued or transferred no later than the end of the Determination
Year.
6. IRC §§ 280G and 4999. Notwithstanding anything to the contrary contained in this
Agreement, to the extent that the vesting of any RSUs granted to Participant pursuant to this
Agreement (a) constitutes a “parachute payment” within the meaning of Section 280G of the Code and
(b) but for this Section 6, would be subject to the excise tax imposed by Section 4999 of the Code,
then such RSUs shall vest either (i) in full or (ii) in such lesser amount which would result in no
portion of such RSUs 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 Participant’s receipt on an
after-tax basis, of the greatest amount of total compensation, notwithstanding that all or some
portion of such RSUs may be taxable under Section 4999 of the Code.
(a) Calculation. Any calculation required under this Section shall be made in writing
by an independent public accountant, or other appropriate internal or external resource, selected
by the Company, whose determination shall be conclusive and binding upon Participant and the
Company for all purposes. The Company shall bear the costs of performing the calculations
contemplated by this Section, as well as any reasonable legal or accountant expenses, or any
additional taxes, that the Participant may incur as a result of any calculation errors made in
connection with the Code Section 4999 excise tax determination contemplated by this Section.
(b) Order of 280G Payment Reduction. Unless provided otherwise in Participant’s
employment agreement with the Company, the reduction of RSUs vesting, if applicable, shall be
effected in the following order, but only to the extent that each item listed provides for a
reduction to minimize Section 280G consequences: (i) any cash parachute payments, (ii) any health
and welfare and similar benefits valued as parachute payments, (iii) the acceleration of vesting of
any stock options for which the exercise price exceeds the then fair market value of the underlying
stock, (iv) the reduction of any acceleration of vesting of any equity award that is not a stock
option (including the RSUs), and (v) the acceleration of vesting of any stock options for which the
exercise price is less than the fair market value of the underlying stock.
7. Withholding Taxes. The Participant agrees that,
7
(a) Obligation to Pay Withholding Taxes. Upon the payment of any Dividend Equivalents and the
vesting of any portion of the Award of RSUs and the Retained Distributions relating thereto, the
Participant will be required to pay to the Company any applicable Federal, state, local or foreign
withholding tax due as a result of such payment or vesting. The Company’s obligation to deliver the
Shares subject to the RSUs or to pay any Dividend Equivalents or Retained Distributions shall be
subject to such payment. The Company and its Affiliates shall, to the extent permitted by law, have
the right to deduct from the Dividend Equivalent, Shares issued in connection with the vesting or
Retained Distribution, as applicable, or any payment of any kind otherwise due to the Participant
the minimum statutory Federal, state, local or foreign withholding taxes due with respect to such
vesting or payment.
(b) Payment of Taxes with Stock. Subject to the Committee’s right to require the
Participant to pay the minimum statutory withholding tax in cash, the Participant shall have the
right to elect to pay the minimum statutory withholding tax associated with a vesting with Shares
to be received upon vesting. Unless the Company shall permit another valuation method to be elected
by the Participant, Shares used to pay any required withholding taxes shall be valued at the
closing price of a Share on the New York Stock Exchange on the date the withholding tax becomes due
(hereinafter called the “Tax Date”). Notwithstanding anything herein to the contrary, if a
Participant does not elect to pay the withholding tax in cash within the time period established by
the Company, then the Participant shall be deemed to have elected to pay such withholding taxes
with Shares to be received upon vesting. Elections must be made in conformity with conditions
established by the Committee from time to time.
(c) Conditions to Payment of Taxes with Stock. Any election to pay the minimum
statutory withholding taxes with cash must be made prior to the Tax Date in accordance with the
Company’s customary practices and will be irrevocable once made.
8. Changes in Capitalization and Government and Other Regulations. The Award shall be
subject to all of the terms and provisions as provided in this Agreement and in the Plan, which are
incorporated by reference herein and made a part hereof, including, without limitation, the
provisions of Section 10 of the Plan (generally relating to adjustments to the number of Shares
subject to the Award, upon certain changes in capitalization and certain reorganizations and other
transactions).
9. Forfeiture. A breach of any of the foregoing restrictions or a breach of any of the
other restrictions, terms and conditions of the Plan or this Agreement, with respect to any of the
RSUs or any Dividend Equivalents and Retained Distributions relating thereto, except as waived by
the Board or the Committee, will cause a forfeiture of such RSUs and any Dividend Equivalents or
Retained Distributions relating thereto.
10. RSU Repayment Obligation.
(a) In the event of the termination of the Participant’s Employment for Cause as a result of a
Cause event specified in Sections 1(a)(i), 1(a)(iii), 1(a)(iv), or 1(a)(v) above (each a “Covered
Cause Event”), any Shares issued and related Retained Distributions paid to the Participant with
respect to vesting of a RSU Award within the three year period prior to the Participant’s
termination of Employment (the “Forfeiture Period”), shall be subject to
8
repayment to the Company in an amount equal to the fair market value of such Shares and the
amount of such Retained Distributions as of the date such Shares were issued and the Retained
Distributions paid.
(b) In the event the Participant’s Employment is terminated for any reason other than Cause,
and it is determined by the Company within twelve (12) months of such termination of Employment
that the Participant engaged in acts or omissions during the Participant’s three prior years of
Employment that would have resulted in the Participant’s termination by the Company for a Covered
Cause Event, any Shares issued and related Retained Distributions paid to the Participant in the
three-year period prior to and the sixty-day period following the Participant’s termination of
Employment shall be subject to repayment to the Company in an amount equal to the fair market value
of such Shares and the amount of such Retained Distributions as of the date such Shares were issued
and related Retained Distributions paid.
(c) Repayments pursuant to Sections 10(a) or 10(b) shall be made by certified check within
sixty (60) days after written demand is made therefor by the Company. Notwithstanding the
foregoing, the Participant may satisfy the repayment obligations with respect to amounts owed
pursuant to Section 10 by returning to the Company the applicable Shares issued to the Participant,
provided that, the Participant demonstrates to the Company’s satisfaction that such Shares were
continuously owned by the Participant since the date of issuance.
(d) Notwithstanding any of the foregoing, the Company’s Board of Directors (Board) or
committee to whom the Board has delegated such matters shall retain sole discretion regarding
whether to seek the remedies set forth in Sections 10(a) and 10(b). The repayment obligations of
Section 10 shall not apply unless the Company gives the Participant written notice of the Company’s
exercise of its rights under Section 10 within ninety (90) days of a senior officer of the Company
becoming aware of the conduct giving rise to the Covered Cause Event; and if the Company fails to
do so such conduct shall no longer provide a basis for any repayment obligation pursuant to this
Section 10.
(e) If the terms of any employment, consulting, advisory or similar agreement entered into by
the Participant and the Company or any Affiliate provides for compensation forfeiture provisions
triggered by a “Covered Cause Event” (as defined in the employment or similar agreement), then such
provisions shall supersede the provisions of this Section 10 during the term of the employment or
similar agreement.
11. Violation of Restrictive Covenant. If the Participant is or becomes subject to a
restrictive covenant (including, without limitation, a restrictive covenant regarding
non-competition, non-solicitation, or confidentiality) under the terms of any employment,
consulting, advisory or similar agreement entered into by the Participant and the Company or any
Affiliate or under a severance plan or other benefit plan of the Company or any Affiliate, and the
Participant violates the terms of such restrictive covenant, then any RSUs for which Shares have
not yet been issued or transferred pursuant to Sections 4 or 5 shall be immediately forfeited. The
RSU grant is made in consideration of the application of the current or future restrictive
covenants to the RSUs. Forfeiture of the RSUs pursuant to this Section is in addition to any
9
other consequences of a violation of a restrictive covenant under an applicable agreement or
benefit plan, and shall not in any way diminish or otherwise impact the remedies available under
any such agreement or benefit plan. Upon any judicial determination that this Section is
unenforceable in whole or in part, this Section shall be deemed to be modified so as to be
enforceable and to effect the original intent of the parties as closely as possible.
12. Right of Company to Terminate Employment. Nothing contained in the Plan or this
Agreement shall confer on any Participant any right to continue in the employ of the Company or any
of its Affiliates, and the Company and any such Affiliate shall have the right to terminate the
Employment of the Participant at any such time, with or without cause, notwithstanding the fact
that some or all of the RSUs and related Retained Distributions covered by this Agreement may be
forfeited as a result of such termination. The granting of the RSUs under this Agreement shall not
confer on the Participant any right to any future Awards under the Plan.
13. Notices. Any notice which either party hereto may be required or permitted to give
the other shall be in writing and may be delivered personally or by mail, postage prepaid,
addressed to Time Warner Cable Inc., at 0000 Xxxxxxxx Xxxxxxxxx Xxxxx, Xxxxxxxxx, XX 00000,
attention Manager, Executive Compensation, and to the Participant at his or her address, as it is
shown on the records of the Company or its Affiliate, or in either case to such other address as
the Company or the Participant, as the case may be, by notice to the other may designate in writing
from time to time. Any such notice shall be deemed effective upon receipt thereof by the
addressee.
14. Interpretation and Amendments. The Board and the Committee (to the extent
delegated by the Board) have plenary authority to interpret this Agreement and the Plan, to
prescribe, amend and rescind rules relating thereto and to make all other determinations in
connection with the administration of the Plan. The Board or the Committee may from time to time
modify or amend this Agreement in accordance with the provisions of the Plan, provided that no such
amendment shall adversely affect the rights of the Participant under this Agreement without his or
her consent.
15. Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the Company and its successors and assigns, and shall be binding upon and inure to the
benefit of the Participant and his or her legatees, distributees and personal representatives.
16. Copy of the Plan. The Participant agrees and acknowledges that he or she has
received and read a copy of the Plan.
17. Governing Law. The Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York without regard to any choice of law rules thereof which
might apply the laws of any other jurisdiction.
18. Waiver of Jury Trial. To the extent not prohibited by applicable law which cannot
be waived, each party hereto hereby waives, and covenants that it will not assert (whether as
plaintiff, defendant or otherwise), any right to trial by jury in any forum in respect of any suit,
action, or other proceeding arising out of or based upon this Agreement.
10
19. Submission to Jurisdiction; Service of Process. Each of the parties hereto hereby
irrevocably submits to the jurisdiction of the state courts of the State of New York and the
jurisdiction of the United States District Court for the Southern District of New York for the
purposes of any suit, action or other proceeding arising out of or based upon this Agreement. Each
of the parties hereto to the extent permitted by applicable law hereby waives, and agrees not to
assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding
brought in such courts, any claim that it is not subject personally to the jurisdiction of the
above-named courts, that its property is exempt or immune from attachment or execution, that such
suit, action or proceeding in the above-referenced courts is brought in an inconvenient forum, that
the venue of such suit, action or proceedings, is improper or that this Agreement may not be
enforced in or by such court. Each of the parties hereto hereby consents to service of process by
mail at its address to which notices are to be given pursuant to Section 13 hereof.
20. Personal Data. The Company and its Affiliates may hold, collect, use, process and
transfer, in electronic or other form, certain personal information about the Participant for the
exclusive purpose of implementing, administering and managing the Participant’s participation in
the Plan. Participant understands that the following personal information is required for the above
named purposes: his/her name, home address and telephone number, office address (including
department and employing entity) and telephone number, e-mail address, date of birth, citizenship,
country of residence at the time of grant, work location country, system employee ID, employee
local ID, employment status (including international status code), supervisor (if applicable), job
code, title, salary, bonus target and bonuses paid (if applicable), termination date and reason,
taxpayer’s identification number, tax equalization code, US Green Card holder status, contract type
(single/dual/multi), any shares of stock or directorships held in the Company, details of all
grants of RSUs (including number of grants, grant dates, vesting type, vesting dates, and any other
information regarding RSUs that have been granted, canceled, vested, or forfeited) with respect to
the Participant, estimated tax withholding rate, brokerage account number (if applicable), and
brokerage fees (the “Data”). Participant understands that Data may be collected from the
Participant directly or, on Company’s request, from any Affiliate. Participant understands that
Data may be transferred to third parties assisting the Company in the implementation,
administration and management of the Plan, including the brokers approved by the Company, the
broker selected by the Participant from among such Company-approved brokers (if applicable), tax
consultants and the Company’s software providers (the “Data Recipients”). Participant
understands that some of these Data Recipients may be located outside the Participant’s country of
residence, and that the Data Recipient’s country may have different data privacy laws and
protections than the Participant’s country of residence. Participant understands that the Data
Recipients will receive, possess, use, retain and transfer the Data, in electronic or other form,
for the purposes of implementing, administering and managing the Participant’s participation in the
Plan, including any requisite transfer of such Data as may be required for the administration of
the Plan and/or the subsequent holding of Shares on the Participant’s behalf by a broker or other
third party with whom the Participant may elect to deposit any Shares acquired pursuant to the
Plan. Participant understands that Data will be held only as long as necessary to implement,
administer and manage the Participant’s participation in the Plan. Participant understands that
Data may also be made available to public authorities as required by law, e.g., to the U.S.
government. Participant understands that the Participant may, at any time, review Data and may
provide updated Data or corrections to the Data by written notice to the Company. Except to the
extent the collection, use,
11
processing or transfer of Data is required by law, Participant may object to the collection,
use, processing or transfer of Data by contacting the Company in writing. Participant understands
that such objection may affect his/her ability to participate in the Plan. Participant understands
that he/she may contact the Company’s Stock Plan Administration to obtain more information on the
consequences of such objection.
21. Compliance With Code Section 409A. The Agreement is intended to comply with the
requirements of Code Section 409A to avoid taxation under Code Section 409A(a)(1) and shall, at all
times be interpreted, operated and administered in a manner consistent with this intent. References
herein to “termination of employment” and similar terms used in this Agreement shall be deemed to
refer to “separation from service” within the meaning of Code Section 409A to the extent necessary
to comply with Code Section 409A, as applied using a definition of “service recipient” with respect
to any Affiliate that includes all entities that would be treated as a single employer with the
Company under Code Sections 414(b) and 414(c) applying a 50 percent ownership level, rather than an
80 percent ownership level (pursuant to Treasury Regulation Section 1.409-1(h)(3)). Notwithstanding
any provision of the Agreement to the contrary, if at the time of a Participant’s separation from
service, the Participant is a “specified employee” as defined in Code Section 409A and any Shares
or amounts otherwise payable under this Agreement as a result of such separation from service are
subject to Code Section 409A, then no transfer or payment of such Shares or amounts shall be made
until the date that is six months following the Participant’s separation from service (or the
earliest date as is permitted under Section 409A of the Code), and the Company will transfer or pay
any Shares or amounts that are delayed under the foregoing within sixty (60) days of such date.
Notwithstanding the forgoing or any other term or provision of this Agreement or the Plan, neither
the Company nor any Affiliate nor any of its or their officers, directors, employees, agents or
other service providers shall have any liability to any person for any taxes, penalties or interest
due on any amounts paid or payable hereunder, including any taxes, penalties or interest imposed
under Code Section 409A.
22. Entire Agreement. Except as specifically stated herein, this Agreement, together
with the Notice and the Plan, embodies the entire agreement and understanding between the parties
hereto with respect to the subject matter hereof and supersedes all prior oral or written
agreements and understandings relating to the subject matter hereof. No statement, representation,
warranty, covenant or agreement not expressly set forth in this Agreement or the Notice shall
affect or be used to interpret, change or restrict, the express terms and provisions of this
Agreement or the Notice; provided, that this Agreement and the Notice shall be subject to
and governed by the Plan, and in the event of any inconsistency between the provisions of this
Agreement or the Notice and the provisions of the Plan, the provisions of the Plan shall govern.
12
Time Warner Cable Inc. 2006 Stock Incentive Plan
Addendum to Performance-Based RSU Agreement
Addendum to Performance-Based RSU Agreement
For
Use After 1/1/2011
Addendum To Performance-Based RSU Agreement
Acceleration of RSUs During Severance Period
Acceleration of RSUs During Severance Period
WHEREAS, the Participant and the Company are subject to the terms of an employment agreement
with an effective date prior to January 1, 2010 (“Pre-2010 Employment Agreement”);
WHEREAS, the Participant’s Performance-Based Restricted Stock Unit Agreement dated on or after
January 1, 2011 (the “RSU Agreement”) states, among other things, that unless an employment
agreement provides for more favorable equity treatment, unvested RSUs shall vest on a pro-rata
basis upon the Participant’s involuntary termination of employment without cause that is not due to
the Participant’s Performance, subject to satisfaction of the performance condition;
WHEREAS, the Pre-2010 Employment Agreement allows for the more favorable treatment of
continued vesting of RSUs through the Participant’s severance period after a Participant’s
involuntary termination of employment without cause, whether or not due to Performance, and after a
Participant’s voluntary termination of employment due to the Company’s material breach of the
Participant’s Pre-2010 Employment Agreement; and
WHEREAS, in the event of such a termination of employment during the term of the Pre-2010
Employment Agreement (including during any automatic month-to-month extension of the term), the
parties desire to provide for the more favorable vesting treatment, but with payment accelerated to
termination of employment rather than on the scheduled vesting dates of the RSUs.
NOW, THEREFORE, in consideration of the terms hereinafter set forth, the parties agree as
follows:
1. The following provisions of this Addendum are incorporated into and hereby made a part of
the RSU Agreement. Such provisions are effective immediately and shall continue in effect during
the term of the Pre-2010 Employment Agreement. This Addendum shall modify and supersede any
contrary provisions of the RSU Agreement and the Pre-2010 Employment Agreement.
2. All capitalized terms in this Addendum, to the extent not otherwise defined herein, shall
have the meanings assigned to them in the RSU Agreement.
3. For purposes of this Addendum, “Severance Period” means the period of time during
which the Participant receives salary continuation payments and is entitled under the Pre-2010
Employment Agreement to continued treatment as an employee of the Company for equity compensation
purposes as determined by the Company.
4. If, during the term of the Pre-2010 Employment Agreement, the Participant’s Employment with
the Company and its Affiliates is (i) terminated by the Company or its Affiliates and such
termination is not for Cause and not at a time when the Participant is eligible for Retirement or
(ii) terminated by the Participant under circumstances entitling the Participant to salary
continuation payments under the Pre-2010 Employment Agreement, then this Section 4 shall apply, and
Section 5(d) of the RSU Agreement shall not apply. If this Section 4 applies, then, subject to
satisfaction of the Performance Condition, the Participant will be vested upon the Participant’s
termination of Employment in (w) all RSUs and related Retained Distributions that would vest on any
Vesting Date that occurs during the Severance Period, and (x) a pro rata portion of the RSUs and
related Retained Distributions that were scheduled to vest on the next Vesting Date following the
expiration of the Severance Period. Such pro rata portion will be determined as follows:
(y) the number of RSUs and related Retained Distributions covered by the portion
of the Award that were scheduled to vest on such upcoming Vesting Date,
multiplied by;
(z) a fraction, the numerator of which shall be the number of days from the
Vesting Date immediately preceding such Vesting Date (or the Date of Grant if
there was no prior Vesting Date) during which the Participant was (1) employed
by the Company or any Affiliate and (2) to be covered under the Severance
Period, and the denominator of which shall be the number of days from such
immediately preceding Vesting Date (or the Date of Grant if there was no prior
Vesting Date) through the next succeeding Vesting Date.
If the product of (y) and (z) results in a fractional share, such fractional share shall be
rounded to the next higher whole share. The RSUs and any related Retained Distributions
shall be completely forfeited if they are not vested under this Section 4; provided
that, if the Participant will become eligible for Retirement during the Severance
Period, the Participant shall, subject to satisfaction of the Performance Condition, be
vested in all RSUs and related Retained Distributions upon the Participant’s termination of
Employment. Vested Shares subject to the RSUs and all Retained Distributions relating
thereto shall be issued or transferred to the Participant at the time specified in Section
5(h) of the RSU Agreement.
2
