TIME WARNER
CABLE LETTERHEAD
Mike LaJoie
Executive Vice President, Chief Technology Officer
Time Warner Cable
290 Harbor Drive
Stamford, CT 06902
In accordance
with Section 4.10 of the Employment Agreement (the
“Agreement”) dated as of June 1, 2000 between you
and Time Warner Entertainment Company, LP., a subsidiary of Time
Warner Cable Inc., which Agreement expires on December 31,
2005, the Company hereby offers to extend the Agreement with the
same terms and conditions (except as amended below) until
December 31, 2008.
Section 2.1 of the Agreement is hereby
amended to provide that you shall serve as Executive Vice President
& Chief Technology Officer and that you shall report to the
Chief Executive Officer of the Company. Section 3.1 of the
Agreement is hereby amended to provide that your Base Salary, as
defined in the Agreement, will be an amount not less than
$420,600.00. Section 3.2 of the Agreement is hereby amended to
provide that your Target Bonus, as defined in the Agreement shall
be 80%, subject to the Company’s discretion as described in
the Agreement. No other provisions of Sections 2.1, 3.1, 3.2 or any
other provisions of the Agreement are hereby amended.
Please indicate
your acceptance of the foregoing extension of’ the Agreement
by signing this letter and returning it to the Company by
December 31, 2005. Failure to do so will be deemed an election
by you to terminate your employment without cause pursuant to
Section 4.3 of the Agreement.
Very truly
yours,
TIME WARNER ENTERTAINMENT COMPANY, L.P.,
a subsidiary of TIME WARNER CABLE INC.
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/s/ Marc
Lawrence-Apfelbaum
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Marc
Lawrence-Apfelbaum
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Executive Vice
President, General Counsel and Secretary
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Title:
Executive Vice President, Chief Technology Officer
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AMENDED
AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”)
made as of June 1, 2000, between Time Warner Cable, a division
of Time Warner Entertainment Company, L.P., a Delaware limited
partnership (the “Company”), and Michael Lajoie (the
“Executive”).
Pursuant
to the Employment Agreement dated as of November 1, 1998
between the Company and the Executive (the “Original
Agreement”), the Company had secured the services of the
Executive on a full-time basis for the period to and including
April 30, 2001, on and subject to the terms and conditions set
forth in the Original Agreement.
The
Company and the Executive now wish to amend and restate the
Original Agreement, and to continue Executive’s term of
employment, on the terms and conditions provided herein.
The
parties therefore agree as follows:
1.
Term of Employment . The Executive’s term of
employment, as this phrase is used throughout this Agreement, shall
be for the period beginning January 1, 2000, and ending on
December 31, 2002, subject, however, to earlier termination as
expressly provided herein.
2.1.
The Company shall, during the term of employment, employ the
Executive, and the Executive shall serve, as Vice President,
Corporate Development. During the term of employment, the Executive
shall have such functions, duties, powers and responsibilities as
the Company may from time to time delegate to the Executive, and
shall perform such functions, duties, powers and responsibilities
at such locations as the Company shall determine,
it being
understood that the Company will pay or reimburse reasonable moving
expenses if it decides to transfer the Executive to another
location. The Executive agrees, subject to his/her election as such
and without additional compensation, to serve during the term of
employment in such particular additional offices of comparable
stature and responsibility in the Company and its affiliated
companies as the Company may require and to serve as a director and
as a member of any committee of the Board of Directors of the
Company and its affiliated companies to which he/she may be elected
from time to time. During the term of employment, (i) the
Executive’s services shall be rendered on a substantially
full-time, exclusive basis, (ii) he/she will apply on a
full-time basis all of his/her skill and experience to the
performance of his/her duties in such employment, and shall report
to the Senior Vice President Corporate Development of the Company,
or to such other corporate officer(s) more senior than the
Executive as the Senior Vice President Corporate Development shall
determine, and (iii) he/she shall have no other employment
and, without the prior written consent of the Senior Vice President
Corporate Development of the Company, no outside business
activities which require the devotion of substantial amounts of the
Executive’s time.
2.2.
In addition to Executive’s obligations under
Section 8.1.4, in performing his or her duties hereunder,
Executive shall comply with the Company’s and Time Warner
Inc.’s (“TWI”) written policies on conflicts of
interest, service as a director of another company, and other
policies and procedures of the Company and TWI, including as
described in TWI’s Statement of Corporate Policy and
Compliance Program Manual, as may be amended or revised from time
to time, copies of which, as currently in effect, Executive
acknowledges having received.
2
2.3.
Following the term of employment, regardless of whether Executive
is considered an employee of the Company, Executive shall not
provide any services to or take any actions on behalf of the
Company.
3.1.
Base Salary . The Company shall pay or cause to be paid to
the Executive, during the term of employment, a base salary at the
rate of not less than $202,800.00 per annum (the “Base
Salary”). The Company may increase, but not decrease, the
Base Salary at any time and from time to time during the term of
employment.
3.2.
Bonus . In addition to Base Salary, the Executive shall be
entitled to receive an annual cash bonus based on the performance
of the Company and of the Executive. The Executive’s target
bonus (the “Target Bonus”) shall be 40% of the
Executive’s Base Salary, but the Executive acknowledges that
his/her actual bonus (the “Annual Bonus”) will vary
depending upon the performance of the Company and the Executive.
The Company may increase, but not decrease, the Target Bonus at any
time and from time to time during the term of employment. The
Company’s determination of the amount, if any, of Annual
Bonuses to be paid to the Executive under this Agreement shall be
final and conclusive. Payments of any bonus compensation under this
Section 3.2 shall be made in accordance with the then current
practices and policies of the Company.
3.3.
Reimbursement . The Company shall pay or reimburse the
Executive for all reasonable expenses actually incurred or paid by
the Executive during the term of employment in the performance of
his/her services hereunder upon presentation of expense statements
or vouchers or such other supporting information as the Company may
customarily require of its executives at Executive’s level
(as defined in Section 3.6).
3
3.4.
No Anticipatory Assignments . Except as specifically
contemplated hereunder, neither the Executive nor any legal
representative or beneficiary designated by him/her shall have any
right, without the prior written consent of the Company, to assign,
transfer, pledge, hypothecate, anticipate or commute any payment
due in the future to such person pursuant to any provision of this
Agreement, and any attempt to do so shall be void and will not be
recognized by the Company.
3.5.
Indemnification . To the extent not prohibited by applicable
law at the time of the assertion of any liability against the
Executive, the Company shall indemnify the Executive to no lesser
extent than provided in the By-Laws of Time Warner Inc. and the
Partnership Agreement of Time Warner Entertainment Company, L.P.
(whichever is the greater extent of indemnification) as in effect
on the date hereof or the date of any predecessor employment
agreement between the Company and Executive (whichever is the
greater extent of indemnification) (the provisions of which are
hereby incorporated by reference herein); and Executive will be
entitled the benefits of any amendments or additions to such
indemnification provisions that add to or broaden the protection
afforded to the Executive by those provisions.
3.6.
Executive Group . References in this Agreement to employee
at Executive’s level shall mean members of the Executive
Group (defined as individuals with an assigned executive
compensation level with eligibility for the Long Term Cash Plan and
Tier I Level Stock Options or such other substitute plans as the
Company may designate from time to time).
4.
Termination . The Company shall have the right to terminate
the term of employment for cause or without cause; provided,
however, that if such termination is without cause, Executive will
be entitled to make an election as provided in Section 4.2
hereunder.
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Executive shall
have the right to terminate the term of employment (a) because
of a material breach of this Agreement by the Company and upon such
termination to make an election as provided for in Section 4.4
hereunder; (b) on 90 days notice as provided in
Section 4.3 hereunder; and (c) pursuant to Executive’s
exercise of the Retirement Option, pursuant to Section 4.11
hereunder.
4.1.
Termination by Company for Cause . The Company may terminate
for cause the term of employment and all of the Company’s
obligations hereunder, other than its obligations set forth below
in Section 4.1.1. Termination by the Company for cause shall
mean termination by the Company because of (a) the
Executive’s 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); or (b) the Executive’s
willful refusal without proper cause to perform his/her obligations
under this Agreement; or (c) the Executive’s material breach
of any of the covenants provided for in Sections 2.2 or 8; or
(d) the Executive’s engaging in willful misconduct that
results in a substantial financial loss to, or has a substantial
adverse effect on the reputation of, the Company. Such termination
shall be effected by written notice thereof delivered by the
Company to the Executive and shall be effective as of the date of
such notice; provided, however, that if (i) such termination
is because of the Executive’s willful refusal without proper
cause to perform any one or more of his/her obligations under this
Agreement, (ii) such notice is the first such notice of
termination for any reason delivered by the Company to the
Executive hereunder, and (iii) within five days following the
date of such notice, the Executive shall cease his/her refusal and
shall use his/her best efforts to perform such obligations, the
termination shall be deemed null and void.
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4.1.1.
In the event of termination of the term of employment by the
Company for cause in accordance with the foregoing procedures,
without prejudice to any other rights or remedies that the Company
may have at law or equity, the Company shall have no further
obligations to the Executive other than (i) to pay the Base
Salary accrued through the effective date of such termination;
(ii) to pay any Annual Bonus pursuant to Section 3.2 to
the Executive in respect of any year prior to the year in which
such termination of employment is effective which has not yet been
paid as of such termination; and (iii) with respect to any
rights the Executive has under Section 7 through the effective
date of termination (except as may be otherwise specifically
provided in any such plan or program as of the date of termination)
or pursuant to any insurance or other benefit plans or arrangements
of the Company maintained for the benefit of its Executive Group.
Executive hereby disclaims any right to receive a pro rata portion
of his or her Annual Bonus with respect to the year in which such
termination occurs.
4.2.
Termination by Company Without Cause . Provided that notice
and termination has not previously been given under any other
Section hereof, the Company shall have the right to terminate the
term of employment without cause at any time. Such termination
shall be effected by written notice thereof delivered by the
Company to the Executive and shall be effective as of the date of
such notice. If the Company elects to terminate the term of
employment without cause, the Executive shall be entitled to elect,
by written notice delivered within thirty days of the
Company’s notice of termination of the term of employment, to
receive, at the Executive’s option, either (i) a lump
sum payment equivalent to thirty months’ Base Salary and
Annual Bonus, as provided for in Section 4.2.1 hereunder or
(ii) periodic payments equivalent to thirty months’ Base
Salary and Annual Bonus, as provided for in Sections 4.2.2
hereunder. The Executive shall also be entitled to receive
executive level
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outplacement
services (including reasonable office space as designated by the
Company) for a period of one year after the date of notice of such
termination.
4.2.1.
Lump Sum . In the event the Executive shall elect, pursuant
to Section 4.2, to receive a lump sum payment, he/she shall
receive a one-time payment equivalent to thirty months’ Base
Salary (as such Base Salary is in effect immediately prior to the
notice of the termination) and Annual Bonus, with the Annual Bonus
due the Executive in respect thereof being equal to the greater of
(a) the Executive’s then applicable Target Bonus amount
multiplied by 2.5, or (b) the average of the regular Annual
Bonus amounts (excluding the amount of any special or spot bonuses)
received by the Executive from the Company for the two years
immediately preceding the year of termination of the term of
employment, multiplied by 2.5; provided, however, that if such
termination occurs prior to the payment of two Annual Bonuses to
the Executive by the Company, then the calculation of the Annual
Bonus payable under clause (b) of this Section 4.2.1
shall be Executive’s Target Bonus (if no bonuses paid), or
the average of the Executive’s Target Bonus amount and the
Annual Bonus paid (if only one Annual Bonus has been
paid).
4.2.2.
Periodic Payments . In the event the Executive shall elect,
pursuant to Section 4.2, to receive periodic payments, he/she shall
be placed on a leave of absence (the “Leave”) as an
inactive employee of the Company for thirty months following the
date of termination of the term of employment, whether or not
he/she becomes disabled as provided for in Section 5
hereunder. During the Leave, the Executive shall not be required to
provide any services to the Company and shall receive (i) a
Base Salary at an annual rate equal to his/her Base Salary as is in
effect immediately prior to the notice of termination, and
(ii) an Annual Bonus in respect of each calendar year or
portion thereof (in which case a pro rata
7
portion of such
Annual Bonus will be payable) during such period equal to the
greater of (a) the Executive’s then-applicable Target Bonus
amount, or (b) the average of the regular Annual Bonus amounts
(excluding the amount of any special or spot bonuses) received by
the Executive from the Company for the two years immediately
preceding the year of termination of the term of employment
(subject to the proviso set forth in Section 4.2.1(b)). If the
Executive accepts full-time employment with any other person or
entity during the Leave or notifies the Company in writing of
his/her intention to terminate his/her status as an inactive
employee on Leave, then the Executive shall cease to receive the
periodic Base Salary and Annual Bonus payments hereunder and the
Executive shall be entitled to receive, within thirty days after
such commencement or effective date of such employment or
termination of status as an inactive employee on Leave, a lump sum
payment in an amount representing the balance of the Base Salary
and regular Annual Bonuses as the Executive would have been
entitled to receive pursuant to this Section 4.2.2 had the
Executive remained an inactive employee on Leave. Notwithstanding
the preceding sentence, if the Executive accepts full-time
employment with any Affiliate (as defined below) of the Company,
then the periodic Base Salary and Annual Bonus payments provided
for in this Section 4.2.2 shall cease and the Executive shall
not be entitled to any such lump sum payment. For purposes of this
Agreement, the term “Affiliate” means any entity which,
directly or indirectly, controls, is controlled by or is under
common control with, the Company.
4.3.
Termination By Executive Without Cause . Except as provided
in Section 4.4 or by reason of Executive’s retirement
under the terms of Section 4.11 or of any retirement plan in
which employees of the Company are generally eligible to
participate, Executive may not terminate his or her employment
under this Agreement except upon 90 days prior written notice
and only if notice of termination has not previously been given
under any
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other Section
hereof. Upon the effectiveness of such termination.
Executive’s employment with the Company will terminate, and
the Company shall have no further obligations to the Executive
other than (i) to pay the Base Salary accrued through the
effective date of such termination; (ii) to pay any Annual Bonus
pursuant to Section 3.2 to the Executive in respect of any
year prior to the year in which such termination of employment is
effective which has not yet been paid as of such termination; and
(iii) with respect to any rights the Executive has under
Section 7 through the effective date of termination (except as
may be otherwise specifically provided in any such plan or program
as of the date of termination) or pursuant to any insurance or
other benefit plans or arrangements of the Company maintained for
the benefit of its Executive Group. Executive hereby disclaims any
right to receive a pro rata portion of his or her Annual Bonus with
respect to the year in which such termination occurs.
4.4.
Termination by Executive for Material Breach by the Company
. The Executive shall have the right, exercisable by delivery of
written notice to the Company, to terminate the term of employment
effective fifteen days after the giving of such notice, if, at the
time of such notice, the Company shall be in material breach of its
obligations hereunder; provided that, with the exception of a
breach of clause (a) below, such notice shall be deemed null
and void and the term of employment shall not so terminate if
within such fifteen-day period the Company shall have cured all
such material breaches of its obligations hereunder. The parties
acknowledge and agree that a material breach by the Company shall
include, but not be limited to, (a) the Company failing to
cause the Executive to serve in the capacities set forth in
Section 2; and (b) the Company violating the provisions
of Section 2 with respect to the Executive’s authority,
functions, duties or responsibilities (whether or not accompanied
by a change in title). After the effective date of such
termination, the Executive shall have no further obligations
or
9
liabilities to
the Company whatsoever (except for his/her obligation under
Section 4.8, if any, and his/her obligations under
Section 8 and 9, which shall survive such termination). If
Executive terminates the term of employment because of a material
breach of the Agreement by the Company, Executive shall be entitled
to elect, by written notice delivered within fifteen days of
Executive’s notice of termination, to receive, at
Executive’s option either (i) a lump sum payment
equivalent to thirty months’ Base Salary and Annual Bonus, or
(ii) periodic payments equivalent to thirty months’ Base
Salary and Annual Bonus, in accordance with the provisions of
Sections 4.2.1 and 4.2.2 hereunder, respectively.
4.5.
During the period the Executive is on Leave pursuant to
Section 4.2.2 and during any period of disability described in
Section 5, the Executive shall continue to be eligible to
receive the benefits required to be provided to the Executive under
Section 7 to the extent such benefits are maintained in effect
by the Company for members of its Executive Group (as defined in
Section 3.6); provided, however, the Executive shall not be
entitled to any additional awards or grants under any stock option,
restricted stock or other cash or stock-based long term incentive
plan. At the time the Executive leaves the payroll of the Company
pursuant to the provisions of Sections 4, 4.1, 4.2, 4.4, 5 or
6, the Executive’s rights to benefits and payments under any
benefit plans or any insurance or other death benefit plans or
arrangements of the Company or under any stock option, restricted
stock, stock appreciation right, bonus unit, management incentive
or other plan of the Company shall be determined in accordance with
the terms and provisions of such plans and any agreements under
which such stock options, restricted stock or other awards were
granted.
4.6.
In the event the term of employment and the Executive’s
employment with the Company is terminated pursuant to
Sections 4, 4.1, 4.2, 4.3, 4.4, 4.1 1, 5 or
10
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regardless of whether the Executive elects clause (i) or
(ii) as provided in Sections 4.2 and 4.4), the Executive shall
not be entitled to any other notice or severance or to be paid for
any unused sabbatical, the payments provided for in such Sections
being in lieu thereof. The Executive shall be paid out for unused
vacation time accrued in the year of termination of employment
only.
4.7.
Any obligation of the Executive to mitigate his/her damages
pursuant to Section 4.9 shall not be a defense or offset to
the Company’s obligation to pay the Executive in full the
amounts provided in Sections 4.2.1 or 4.2.2 or the timely and
full performance of any of the Company’s other obligations
under this Agreement.
4.8.
In partial consideration for the Company’s obligation to make
the payments described in Sections 4.2 and 4.4, or as a result
of Executive’s election of the Retirement Option described in
Section 4.11 herein, Executive shall execute and deliver to
the Company a release which shall include the substance of the
terms of the Separation Agreement and Release in the form as set
forth in Exhibit A or such other form as is satisfactory to
the Company. The Company shall deliver the form of such release to
Executive within a reasonable period of time after the Executive
has made the election set forth in Sections 4.2 or 4.4, or
within a reasonable period of time following Executive’s
providing a Notice of Election of Retirement Option under
Section 4.11 therein. Executive shall execute and deliver such
release to the person designated for receipt of notices under
Section 10.1 within thirty days of his/her receipt thereof
from the Company. If Executive shall fail to execute and so deliver
to the Company such release within thirty days of his/her receipt
thereof from the Company, Executive shall receive, in lieu of the
payments described in Sections 4.2, 4.4, or 4.11, a lump sum
cash payment in an amount
11
determined in
accordance with the severance policies for non-contract Executives
of the Company then applicable.
4.9.
Mitigation . In the event of the termination of employment
by the Executive as a result of a material breach by the Company of
any of its obligations hereunder, the Executive shall not be
required to seek other employment in order to mitigate his/her
damages hereunder, and, regardless of the period with respect to
which paid, no compensation or other payments from any other
employment, services or activity of the Executive shall be applied
by the Company in reduction of or be payable or paid by the Company
pursuant to Sections 4.2 and 4.4; provided, however, that,
notwithstanding the foregoing, if there are any damages hereunder
by reason of the events of termination described above which are
contingent on a change (within the meaning of
Section 280G(b)(2)(A)(I) of the Internal Revenue Code), the
Executive shall be required to mitigate such damages hereunder,
including any such damages theretofore paid, but not in excess of
the extent, if any, necessary to prevent the Company from losing
any tax deductions to which it otherwise would be entitled in
connection with such damages if they were not so contingent on a
change. With respect to the preceding sentences, any payments or
rights to which the Executive is entitled by reason of the
termination of the term of employment by the Executive pursuant to
Section 4.4 or in the event of the termination of the term of
employment by the Company pursuant to Section 4.2 shall be
considered as damages hereunder.
4.10.
Effect of Non-Tender of Subsequent Agreement . Assuming that
Executive has not yet attained the age of sixty-five at the end of
the term of this Agreement, in the event that the Company does not
offer Executive a new Employment Agreement similar to this
Employment Agreement with a term of at least thirty months, the
Executive shall be entitled
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to receive, as
thirty months’ severance, all of the benefits and payments as
described in Section 4.2, with Executive being entitled to
make the election outlined in Section 4.2. Except as provided
herein, the Company shall not be obliged to further employ the
Executive. If the Executive has attained the age of sixty-five by
the end of the term of this Agreement, nothing herein shall oblige
the Company to tender him/her a similar agreement, and no severance
shall be due Executive in the event of the Company’s failure
to do so.
4.11.
Retirement Option . Provided that, at the time of election,
the Executive (a) is actively employed by the Company,
(b) has reached the age of fifty-five, and (c) has been
employed by the Company as member of the Executive Group (as
defined in Section 3.6) for at least five years the Executive
may elect, by providing written notice to the Company in the form
attached hereto as Exhibit “B,” the Retirement Option,
as outlined below:
4.11.1.
Within fifteen days of the Executive’s exercise of the
Retirement Option, the Company and the Executive will attempt to
agree upon the length a “Transition Period” of between
six and twelve months. The Transition Period shall commence as of
the date of Executive’s written notice to the Company of
his/her Retirement Option election.
4.11.1.1.
If the parties are unable, within the fifteen-day period, to agree
on the length of the Transition Period, then the Transition Period
shall be for six months.
4.11.1.2.
During the Transition Period, the Executive will remain actively
employed, at Executive’s then-current rate of compensation,
and, in addition to Executive’s other regular functions and
responsibilities, will assist the Company in identifying,
recruiting, and training the Executive’s replacement. The
Executive will continue to be responsible for the management,
direction, and performance of his/her division, operating
unit
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or department
during the Transition Period to the full extent that Executive was
so responsible prior to the Transition Period.
4.11.2.
At the conclusion of the Transition Period, the term of employment
hereunder will cease and Executive will become an advisor to the
Company (the “Advisory Period”) as follows:
4.11.2.1.
The Advisory Period will extend for thirty-six months. During the
Advisory Period, the Executive will receive compensation as
follows: (a) for the first twelve months, Executive’s
then-current Base Salary and bonus; (b) for the second twelve
months, Base Salary, plus 50% bonus; and (c) for the third
twelve months, Base Salary only. The bonus amount paid in
(a) and (b) will be calculated as follows: The bonus
amount paid will be the greater of Target Bonus or the average of
the two most recent full year Annual Bonuses earned (excluding any
special or spot bonuses). All payments pursuant to this subsection
shall be made in accordance with the Company’s ordinary
timing and procedures for salary and bonus compensation.
4.11.2.2.
The Executive will continue to vest in any outstanding stock
options and long-term cash incentives (or any other similar plan)
during the Advisory Period; however, the Executive will not be
entitled to any additional awards or grants. The Executive will
also continue to be eligible to participate in any deferred
compensation plans and any Company-sponsored benefit plans, savings
plans, pension plans and group insurance plans (including medical,
dental and vision care, long-term disability, and life insurance)
as if he/she were actively employed during the Advisory Period. If
the Executive elected premium reimbursement from the Company in
lieu of Company-paid group term life insurance, the payments in
effect at the end of the Transition Period will be continued until
the end of the
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Advisory
Period. If the Executive did not elect premium reimbursement from
the Company, group term life insurance equal to the amount provided
at the end of the Transition Period will be continued until the end
of the Advisory Period.
4.11.2.3.
The Executive will not be provided with office space or secretarial
services by the Company during the Advisory Period. However, as
soon as possible following the end of the Transition Period, the
Executive will receive a lump-sum payment of $10,000, less
appropriate taxes and deductions, as reimbursement for office
expenses incurred during the Advisory Period. No further payments
or reimbursements will be made for office Space or secretarial
services during the Advisory Period.
4.1
1.2.4. During the Advisory Period, the Executive will be eligible
for reimbursement of financial and estate planning expenses, in the
same amount and under the same terms as other Executives at
Executive’s level.
4.11.2.5.
The Executive shall not be eligible for a Company-provided car or
car allowance during the Advisory Period. Any Company-provided car
in the possession of the Executive will be returned by the
Executive to the Company prior to the commencement of the Advisory
Period.
4.11.2.6.
During the Advisory Period, the Executive
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