Time Warner Cable 2015 Annual Report Download - page 39

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Program component, the Compensation Committee indicated that it believed that Operating Income would be an
important indicator of the overall operational strength and performance of the Company’s business in 2014, including
the ability to provide cash flows to service debt, pay dividends, repurchase shares and prudently invest in new growth
opportunities.
The following threshold and maximum goals were established for the Profit Participation Program
component of the 2014 AIP based upon a review of the prior year’s Operating Income results, the Company’s
2014 budget and other factors:
Profit Participation Program
for Named Executive Officers
(50% of 2014 AIP Opportunity)
2014 Profit Participation Program—Financial Metric
Threshold
Award
(50% of target)
Maximum
Award
(150% of target)
(in millions)
Operating Income ........................................ $4,500 $5,100
The Compensation Committee determined that the threshold Operating Income goal set an appropriate level
of performance to earn an award under the Profit Participation Program component of the 2014 AIP. If the
Company failed to meet the threshold level, no bonus payment would be made under this component of the 2014
AIP. Similarly, the maximum goal was considered to present very significant challenges and was not likely to be
attained. If the Company exceeded the maximum goal, the Company financial performance “score” under the
Profit Participation Program component would be 150%.
If the Company’s Operating Income after required adjustments (“adjusted Operating Income”) was above
the threshold but below the maximum goal, the Compensation Committee would determine the Profit
Participation Program score in its discretion, but using as its starting point the “straight line interpolation” of the
Company’s performance against the threshold and maximum goals. For example, if the Company’s adjusted
Operating Income results were exactly at the midpoint between the threshold and maximum goals, the straight
line interpolation would be 100%, the midpoint between 50% and 150%.
33