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Exhibit 10.3
EMPLOYMENT
AGREEMENT
AGREEMENT by and between TIME
WARNER TELECOM HOLDINGS INC. (the “ Company ”)
and Paul Jones (the “ Employee ”), dated as of
September 28, 2007 (the “ Effective Date
”).
WHEREAS, the Company is
desirous of continuing to employ the Employee in an executive
capacity on the terms and conditions, and for the consideration,
hereinafter set forth, and the Employee is desirous of being
employed by the Company on such terms and conditions and for such
consideration.
NOW, THEREFORE, IT IS HEREBY
AGREED AS FOLLOWS:
1. Term .
(a) Employment Period.
The Company hereby agrees to continue to employ the Employee, and
the Employee hereby agrees to continue to serve the Company,
subject to the terms and conditions of this Agreement, for the
period commencing on the Effective Date and ending on the three
year anniversary thereof (the “ Employment Period
”); provided that, on such three year anniversary of
the Effective Date and each annual anniversary of such date
thereafter (such date and each annual anniversary thereof, the
“ Renewal Date ”), unless previously terminated
in accordance with the provisions of Section 3 hereof, the
Employment Period shall be automatically extended so as to
terminate one year from such Renewal Date, unless, at least sixty
(60) days prior to the Renewal Date, the Company shall give
notice to the Employee that the Employment Period shall not be so
extended.
(b) Change of Control
Employment Agreement. The Employee and the Company acknowledge
that they have also entered into a Change of Control Employment
Agreement (“ COC Agreement ”) of even date
herewith. Upon the occurrence of the Effective Date as defined in
the COC Agreement, this Agreement will terminate and will be
superseded by the COC Agreement, except that such termination will
not relieve the Company of its obligation to pay any amount earned
and payable prior to the termination of this Agreement.
2. Terms of Employment
. (a) Position and Duties . (i) During the
Employment Period, the Employee shall serve as Executive Vice
President, General Counsel & Regulatory Policy or in such
other position as the Company shall determine, and will perform
such duties and responsibilities as may be assigned to the Employee
from time to time by the Company, and shall perform his or her
services at the headquarters of the Company in the Denver, Colorado
area, and shall travel for business purposes to the extent
necessary or appropriate in the performance of such
services.
(ii) During the Employment
Period, and excluding any periods of vacation and sick leave to
which the Employee is entitled, the Employee agrees to devote
substantially all of his or her attention and time during normal
business hours to the business and affairs of the Company and, to
the extent necessary to discharge the responsibilities assigned to
the Employee
hereunder, to use the Employee’s
reasonable best efforts to perform faithfully and efficiently such
responsibilities. During the Employment Period, it shall not be a
violation of this Agreement for the Employee to serve on corporate,
civic or charitable boards or committees, deliver lectures, fulfill
speaking engagements or teach at educational institutions and
manage personal investments, so long as such activities do not
significantly interfere with the performance of the
Employee’s responsibilities as an employee of the Company in
accordance with this Agreement and the Employee complies with
applicable provisions of the Company’s Code of Conduct and
Code of Ethics.
(b) Compensation
(i) Base Salary . During the Employment Period, the
Employee shall receive an annual base salary (“ Annual
Base Salary ”) of $311,535. The Employee’s Annual
Base Salary shall be reviewed at least annually by the Compensation
Committee of the Board (the “ Compensation Committee
”) pursuant to its normal performance review policies for
senior executives. Any increase in Annual Base Salary shall not
serve to limit or reduce any other obligation to the Employee under
this Agreement. The Annual Base Salary shall not be reduced and the
term “Annual Base Salary” as utilized in this Agreement
shall refer to the Annual Base Salary as increased from time to
time.
(ii) Annual Bonus . In
addition to the Annual Base Salary, the Employee shall be eligible
to be awarded, for each fiscal year of the Company or portion of a
fiscal year ending during the Employment Period, an annual bonus
(the “ Annual Bonus ”) pursuant to the terms of
the Company’s Annual Incentive Plan, as in effect from time
to time, based on a target percentage of the Annual Base Salary
paid to the Employee during such fiscal year of 75% (the “
Target Bonus ”). The Employee acknowledges that his or
her actual annual bonus will be at the sole discretion of the
Compensation Committee and may vary and range from 0% to 150% of
the target amount, depending on actual performance of the Company
and the Employee. “Annual Bonus” for any given fiscal
year shall mean the amount, if any, of annual bonus earned by the
Employee with respect to the applicable fiscal year of the Company,
including amounts deferred.
(iii) Other Benefits .
During the Employment Period: (A) the Employee shall be
entitled to participate in incentive, savings and retirement plans,
practices, policies and programs of the Company to the same extent
as provided generally to similarly situated executives of the
Company; and (B) the Employee and/or the Employee’s
family, as the case may be, shall be eligible for participation in,
and shall receive benefits under, welfare benefit plans, practices,
policies and programs provided by the Company to the same extent as
provided generally to similarly situated executives of the Company.
The Company reserves the right to amend or cancel any such plan,
practice, policy or program in its sole discretion, subject to the
terms of such plan, practice, policy or program and applicable
law.
(iv) Expenses . During
the Employment Period, the Employee shall be entitled to receive
prompt reimbursement for all reasonable business expenses incurred
by the Employee in accordance with the Company’s
policies.
3. Termination of
Employment . (a) Death or Disability . The
Employee’s employment shall terminate automatically upon the
Employee’s death during the Employment Period. If the Company
determines in good faith that the Disability (as defined below) of
the Employee has occurred during the Employment Period, it may
provide the Employee with
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written notice in accordance with
Section 9(b) of this Agreement of its intention to terminate
the Employee’s employment. In such event, the
Employee’s employment with the Company shall terminate
effective on the 30th day after receipt of such notice by the
Employee (the “ Disability Effective Date ”),
provided that, within the thirty (30) days after such
receipt, the Employee shall not have returned to full-time
performance of the Employee’s duties. For purposes of this
Agreement, “ Disability ” shall mean the absence
of the Employee from the Employee’s duties with the Company
on a full-time basis for one hundred and eighty
(180) consecutive days or one hundred and eighty
(180) days within any twelve month period as a result of
incapacity due to mental or physical illness.
(b) Cause . The
Company may terminate the Employee’s employment during the
Employment Period either with or without Cause. For purposes of
this Agreement, “ Cause ” shall mean:
(i) being convicted of, or
pleading guilty or nolo contendere to, a charge of
commission of a felony or a misdemeanor involving moral
turpitude;
(ii) engaging in any theft,
misappropriation, embezzlement or similar financial fraud or
reckless or willful destruction of the Company’s property, or
willful or reckless violation of the Company’s insider
trading policy;
(iii) the willful and
continued failure of the Employee to perform substantially the
Employee’s duties (as contemplated by Section 2(a)) with
the Company or its affiliated companies (other than any such
failure resulting from incapacity due to physical or mental
illness), after a written demand for substantial performance is
delivered to the Employee by the Board or the Chief Executive
Officer of the Company that specifically identifies the manner in
which the Board or the Chief Executive Officer of the Company
believes that the Employee has not substantially performed the
Employee’s duties;
(iv) the willful or reckless
engaging by the Employee in illegal conduct or gross misconduct
that is materially injurious to the Company’s business,
financial condition or reputation;
(v) any willful or reckless
breach of a statutory or common law duty of loyalty to the Company
that is materially injurious to the Company’s business,
financial condition or reputation;
(vi) any willful and material
violation of the Company’s Code of Conduct; or
(vii) any material breach of
the Employee’s obligations under this Agreement, including
Section 7.
No act, or failure to act, shall be
considered “willful” if it is done, or omitted to be
done, based upon authority (A) given pursuant to a resolution
duly adopted by the Board, (B) upon the instructions of the
Chief Executive Officer of the Company or (C) based upon the
advice of counsel for the Company. With respect to the conduct
described in Sections 3(b)(ii) through
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3(b)(vii) above, the Company shall
provide the Employee with written notice setting forth the details
of any claimed breach and in the case of the conduct described in
Section 3(b)(iii) above, the Employee shall have a reasonable
period of time (not less than thirty (30) days) to cure such
claimed breach.
(c) Notice of
Termination . Any termination by the Company for Cause shall be
communicated by Notice of Termination (as defined below) to the
other party hereto given in accordance with Section 9(b) of
this Agreement. For purposes of this Agreement, a “ Notice
of Termination ” shall mean a written notice that
(i) indicates the termination provision in this Agreement
relied upon and (ii) specifies the termination date (which
date shall be not more than thirty (30) days after the giving
of such notice) if the Date of Termination (as defined below) is
other than the date of receipt of such notice. The failure by the
Employee or the Company to set forth in the Notice of Termination
any fact or circumstance that contributes to a showing of Cause
shall not waive any right of the Employee or the Company,
respectively, hereunder or preclude the Employee or the Company,
respectively, from asserting such fact or circumstance in enforcing
the Employee’s or the Company’s rights
hereunder.
(d) Date of
Termination . “ Date of Termination ” shall
mean (i) if the Employee’s employment is terminated by
the Company for Cause, the date of receipt of the Notice of
Termination or any later date specified therein (which date shall
not be more than thirty (30) days after the giving of such
notice), as the case may be, (ii) if the Employee’s
employment is terminated by the Company other than for Cause, death
or Disability, the Date of Termination shall be the date on which
the Company notifies the Employee of such termination, or such
later date specified by the Company, (iii) if the
Employee’s employment is terminated by reason of death or
Disability, the Date of Termination shall be the date of death of
the Employee or the Disability Effective Date, as the case may be,
and (iv) if the Employee’s employment is terminated by
the Employee for any reason, the date on which the Employee
notifies the Company of such termination, or such later date as is
mutually agreed by the Company and the Employee.
4. Obligations of the
Company upon Termination . (a) Other Than for Cause,
Death or Disability . If, during the Employment Period, the
Company shall terminate the Employee’s employment other than
for Cause, death or Disability:
(i) the Company shall pay to
the Employee the aggregate of the following amounts in a lump sum
in cash within thirty (30) days after the Date of Termination,
or with respect to the amounts set forth in Sections 4(a)(i)(B) and
4(a)(i)(C), if later, within eight (8) days after the
Employee’s execution and delivery (without revocation) of a
“Waiver and Release” in substantially the form attached
hereto as Exhibit A (the “ Release ”),
which Release must be delivered (and not revoked) not later than 21
days after the Date of Termination (or such longer period of time
permitted by the Company, but in no event later than the latest
business day that is not more than two months after the end of the
calendar year in which the Date of Termination occurs) (the “
Release Deadline ”):
(A) the sum of (1) the
Employee’s Annual Base Salary and any accrued vacation pay
through the Date of Termination, (2) the
Employee’s
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Annual Bonus for the fiscal
year immediately preceding the fiscal year in which the Date of
Termination occurs (other than any portion of such Annual Bonus
that was previously deferred) if such bonus has not been paid as of
the Date of Termination, and (3) the Employee’s business
expenses that have not been reimbursed by the Company as of the
Date of Termination that were incurred by the Employee prior to the
Date of Termination in accordance with the applicable Company
policy, in the case of each of clauses (1) through (3), to the
extent not theretofore paid (the sum of the amounts described in
clauses (1) through (3) shall be hereinafter referred to
as the “ Accrued Obligations ”); and
(B) subject to the
Employee’s delivery (and non-revocation) of the Release not
later than the Release Deadline,
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