Time Warner Cable 2015 Annual Report Download - page 77

satisfaction of any relevant performance conditions before the executive receives the stock underlying
the accelerating award.
•Accelerated Stock Options Have a Shortened Term. TWC’s stock option awards have ten-year terms.
However, if stock option vesting is accelerated after a change-in-control-related termination, the term of
the stock option is generally shortened to one year from the termination date. As a result, the executive
may have a significantly shorter time to benefit from potential stock price appreciation and realize the
compensation valuation calculated at the time of the award.
➣TWC not “Apples to Apples” with other Companies Cited by the Proposal. The change in control
vesting provisions used by IBM, Apple and the other companies cited in the proponent’s supporting statement as
exemplary must be reviewed in the context of those companies’ size, industry and incentive compensation
programs and philosophies, which are very different from TWC’s. Their programs use a variety of different
methods to achieve their particular objectives, such as relatively shorter vesting periods, larger awards or
rewarding long-term service with post-termination vesting, which may obviate the need for accelerated vesting
following a termination of employment in the event of a change in control. The diversity of contexts, goals and
structures underscores the importance of affording the Compensation Committee significant flexibility in the
design of appropriate awards in light of the Company’s circumstances.
➣Shareholders Endorse TWC’s Equity Award Flexibility. TWC’s executive compensation program is
carefully balanced and supports stockholders’ interests. More than 90% of votes were cast in favor of approving
the TWC stock incentive plan in 2011, which explicitly permits the use of the “double trigger” accelerated
vesting provision. The IBEW proposal would inappropriately limit the Compensation Committee’s discretion in
developing the Company’s incentive compensation program.
The Board believes the current structure of the Company’s executive compensation program, including
providing for full accelerated vesting of equity awards in the event of a change-in-control-related termination, is
appropriate and effective. The program is consistent with the Company’s compensation philosophy and the
compensation practices of the Company’s peers and is in the best interest of the Company and its stockholders.
In addition, the Compensation Committee’s discretion and flexibility to develop competitive compensation
programs and vesting provisions that best advance the interests of the Company and its stockholders should not
be limited.
Accordingly, the Board of Directors recommends a vote AGAINST the proposal.
Vote Required for Approval
The affirmative vote of a majority of the votes duly cast by the holders of the Common Stock is required to
adopt this proposal.
VOTING AT THE ANNUAL MEETING
Voting at the Annual Meeting; Record Date
Only holders of record of the Company’s Common Stock at the close of business on May 7, 2015, the
record date, are entitled to notice of and to vote at the Annual Meeting. At that time, 282,686,199 shares of
Common Stock, par value $0.01 per share, were entitled to vote. Each issued and outstanding share of Common
Stock has one vote on any matter submitted to a vote of stockholders.
The presence, in person or by proxy, of the holders of a majority of the votes entitled to be cast at the
Annual Meeting is necessary to constitute a quorum.
Required Vote
A majority of the votes duly cast by the holders of Common Stock with respect to each director is required
for the election of each director.
The affirmative vote of a majority of the votes duly cast by the holders of Common Stock is required to
approve each of the other matters to be acted upon at the Annual Meeting.
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