Time Warner Cable 2015 Annual Report Download - page 30

As a result, as discussed in more detail below, the Committee made certain changes to the compensation program
in 2014 that were designed to support stockholder alignment and the pay-for-performance orientation of the program
while also addressing the importance of motivating and retaining talent against the backdrop of the pending Comcast
merger. Specifically, the Compensation Committee approved an enhanced cash bonus opportunity based on the
Company’s ambitious 2014 performance objectives and advanced certain anticipated annual equity awards into 2014:
•Enhanced Cash Bonus Opportunity. To further incentivize employees to achieve the Company’s
operating and financial goals despite the potential distractions and additional responsibilities associated
with the pending Comcast merger, the Company established a supplemental bonus opportunity (the
“Supplemental Bonus Program”) for all approximately 15,000 employees who participated in the
Company’s regular 2014 annual cash incentive program, including the named executive officers, that
effectively increased each participant’s target bonus opportunity by 50% and was based on the
achievement of financial and operational goals established under the regular 2014 annual bonus
program, payable upon the closing, or abandonment, of the Comcast merger; and
•Retention Equity Awards. To further support employee retention, the Compensation Committee
approved advancing into 2014 the Company’s equity awards that would otherwise have been made in
2015 and 2016 for the approximately 1,800 equity-award eligible employees, including the executive
officers, while, importantly, retaining significant vesting attributes of the awards as if they had been
made in 2015 and 2016 (the “retention equity awards”).
The lengthy regulatory review process—and the ultimate termination of the Comcast merger—
underscores the importance and effectiveness of the Company’s 2014 compensation planning and
programs. The Company’s executive team remains in place and—as evidenced by the Company’s 2014
operating and financial results—was intently focused on achieving the Company’s short and long-term
goals despite the uncertainty and challenges during the pendency of the transaction. In addition, the
retention equity awards remain subject to their time-based vesting schedules and, consistent with its intent
when the retention equity awards were made, the Compensation Committee made no new equity awards
to the named executive officers in 2015.
These special programs are discussed in more detail below under “2014 Short-Term Incentive Program—
Annual Cash Bonus—Supplemental Bonus Program” and “2014 Long-Term Incentive Program—Equity-Based
Awards—Merger-Related Retention Equity Awards.”
2014 Highlights
Company Performance
In January 2014, the Company announced a three-year plan to revitalize its residential services by
refocusing on growing its customer base, investing in reliability and customer service and enhancing its products
and to drive growth in business services by expanding its network, augmenting the sales force and increasing
productivity. During 2014, the Company made significant operational and financial progress against the plan’s
goals even as it sought regulatory approval and conducted integration planning for the Comcast merger. In
addition to the 2014 accomplishments, the Company, led by its executive officers, has created significant
stockholder value over the past several years:
Significant Operational Improvement
and Solid Financial Performance
In 2014, the Company:
• Engineered and executed a profound subscriber turnaround—adding 150,000 residential customer
relationships and 373,000 residential triple-play customers in 2014.
• Increased revenue 3.1% during 2014 to $22.8 billion as a result of revenue growth in all its segments,
including growth of 22.8% in business services revenue, 10.4% in residential high-speed data revenue
and 10.6% in advertising revenue; total revenue has grown 15.9% over the last three fiscal years.
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