UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

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Charter Communications, Inc.

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March 15, 2011

 

Dear Stockholder:

 

You are invited to attend the annual meeting of stockholders of Charter Communications, Inc. (the “Company” or “Charter”), which will be held at the Four Seasons Hotel, 1111 14th Street, Denver, Colorado 80202 on Tuesday, April 26, 2011 at 10:00 a.m. (Mountain Daylight Time).

 

All stockholders of record at the close of business on February 25, 2011 are invited to attend the meeting. For security reasons, however, to gain admission to the meeting you may be required to present identification containing a photograph and to comply with other security measures. Parking at the Hotel for the Annual Meeting will be complimentary. Please inform the attendant you are attending the Charter Annual Meeting.

 

Details of the business to be conducted at the annual meeting are provided in the attached Notice of Annual Meeting and Proxy Statement.

 

Whether or not you attend the annual meeting, it is important that your shares be represented and voted at the meeting. Therefore, I urge you to sign, date, and promptly return the enclosed proxy in the postage-paid envelope that is provided, or you may vote via the Internet pursuant to the instructions on the proxy card. If you decide to attend the annual meeting, you will have the opportunity to vote in person.

 

On behalf of the Board of Directors, I would like to express our appreciation for your continued interest in the affairs of the Company.

 

Sincerely,

 

 

Michael J. Lovett

President and Chief Executive Officer

 

Charter Communications, Inc.

12405 Powerscourt Drive

St. Louis, Missouri 63131

 

 

 

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

OF

CHARTER COMMUNICATIONS, INC.

 

 

 

Matters to be voted on:

 

 

2. To approve the Company’s Executive Bonus Plan;

 

3. To approve the Company’s Executive Incentive Performance Plan;

 

4. To hold an advisory vote on executive compensation;

 

5. To hold an advisory vote on the frequency of holding an advisory vote on executive compensation;

 

 

7. To vote on any other matters properly brought before the stockholders at the meeting.

 

    The proxy statement more fully describes these proposals.

 

By order of the Board of Directors,

 

 

Richard R. Dykhouse

Corporate Secretary

 

March 15, 2011

 

CHARTER COMMUNICATIONS, INC.

 

PROXY STATEMENT

 

Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to Be Held on April 26, 2011. The 2011 notice and proxy statement and the 2010 annual report to stockholders are available at www.proxyvote.com.

 

This proxy statement and The Notice of Internet Availability of Proxy Materials were first mailed to stockholders on or about March 15, 2011.

 

Questions and Answers about Voting and the Annual Meeting

 

What matters will be voted on at the annual meeting?

 

As a holder of Class A common stock, you are being asked to vote, on the following:

 

 

How does the board of directors recommend that I vote?

 

The board of directors recommends that you vote:

 

 

What if other matters come up at the annual meeting?

 

The items listed on the Notice of Annual Meeting of Stockholders are the only matters that we know will be voted on at the annual meeting. Your proxy gives discretionary authority to the persons named on the proxy card to vote on other matters. On such other business as may properly come before the meeting, your shares will be voted in the discretion and judgment of the proxy holder.

Who has been nominated for election as directors at the annual meeting?

 

The board of directors has nominated the eleven current directors for re-election. The eleven directors who have been nominated by the board of directors and agreed to serve as directors are: Messrs. Cohn, Conn, Glatt, Jacobson, Karsh, Lee, Lovett, Markley, Merritt, Parker and Zinterhofer.

 

Who can vote at the annual meeting?

 

Holders of a total of 114,489,841 shares of Class A common stock, as of the close of business on February 25, 2011 (the “Record Date”), are entitled to vote at the annual meeting. Each holder of Class A common stock is entitled to one vote per share. The enclosed proxy card indicates the number of Class A shares that our records show you are entitled to vote.

 

What is the difference between being a stockholder of record and a beneficial owner?

 

You are a stockholder of record if at the close of business on the Record Date; your shares were registered in your name with BNY Mellon Shareholder Services, our transfer agent and registrar.

 

You are a beneficial owner if at the close of business on the Record Date, your shares were held by a brokerage firm or other nominee and not directly in your name, but are held in “street name.” As the beneficial owner of your shares, you have the right to direct your broker or other nominee how to vote your shares, i.e., for or against the proposals to be considered at the annual meeting. If you do not provide your broker or nominee with instructions on how to vote your shares, your broker or nominee will be able to vote your shares with respect to some of the proposals, but not all. See, “What if I do not provide instructions on how to vote my shares,” below.

 

What do I do if my shares are held in “street name”?

 

If your shares are held in the name of your broker, or other nominee, you should return your proxy in the envelope provided by such broker, or nominee or instruct the person responsible for holding your shares to execute a proxy on your behalf. In either case, your shares will be voted according to your instructions.

 

What if I do not provide instructions on how to vote my shares?

 

If you are a stockholder of record and you submit a proxy, but do not provide voting instructions, your shares will be voted for the election of the Company’s director nominees and “FOR” the proposals as described above.

 

If you are a beneficial owner and you do not provide the broker or other nominee which holds your shares with voting instructions, the broker or other nominee has discretionary authority to vote for certain proposals, but not others pursuant to the rules of NASDAQ and the Securities and Exchange Commission (“SEC”). Brokers and other nominees have the discretion to vote on routine matters such as Proposal 6, but not on non-routine matters such as Proposals 1, 2, 3, 4 and 5 . Therefore, if you do not provide voting instructions to the broker or other nominee that holds your shares, the broker or other nominee may only vote for Proposal 6 and any other routine matters properly presented for a vote at the annual meeting.

 

What is the quorum required for the meeting?

 

We will hold the annual meeting if holders of shares having a majority of the record and beneficial holders of the Class A common stock as of the Record Date either sign and return their proxy cards, vote via the Internet or attend the meeting. If you sign and return your proxy card or vote via the Internet, your shares will be counted to determine whether we have a quorum, even if you fail to indicate your vote.

 

Abstentions and broker “non-votes” will be counted as present for purposes of determining whether a quorum exists at the annual meeting.

What is a broker “non-vote”?

 

A broker “non-vote” occurs when a broker or nominee holding shares for a beneficial owner votes on one proposal but does not vote on another proposal because the nominee does not have discretionary voting power for that particular proposal and has not received voting instructions from the beneficial owner.

 

What is the vote required for the proposals on the agenda?

 

The affirmative vote of the holders of a majority of Class A shares cast is required for (i) the election of the Class A directors, (ii) approval of the Company’s Executive Bonus Plan, (iii) approval of the Company’s Executive Incentive Performance Plan, (iv) approval, on an advisory basis, of the compensation of our named executive officers, (v) approval, on an advisory basis, of a triennial advisory vote on executive compensation, and (vi) the ratification of the appointment of KPMG as our independent registered public accounting firm, Proposals 1 through 6, respectively. Under our Certificate of Incorporation and Bylaws, for purposes of determining whether votes have been cast, abstentions and broker “non-votes” will not be counted.

 

A stockholder may vote to “abstain” on any of the proposals. If you vote to “abstain,” your shares will be counted as present at the meeting for purposes of determining a quorum on all matters, but will not be considered to be votes cast with respect to such matters. Abstentions will not be voted and will have the effect of a vote against the proposals. If an executed proxy is returned by a broker holding shares in street name that indicates that the broker does not have discretionary authority as to certain shares to vote on one or more matters (a broker non-vote), such shares will be considered present at the meeting for purposes of determining a quorum on all matters, but will not be considered to be votes cast with respect to such matters. Therefore, broker non-votes will have the effect of a vote against the proposals. In addition, in the election of directors, a stockholder may withhold such stockholder’s vote.

 

What are my choices in the proposals on the agenda?

 

On Proposal 1, you can vote your shares “FOR,” or you can withhold your vote for the Class A director nominees. On Proposals 2, 3, 4 and 6, you can (1) vote for a proposal, (2) vote against a proposal, or (3) abstain from voting. On Proposal 5, you can vote for an advisory vote on when to review executive compensation every (1) one year, (2) two years, or (3) years or (4) you may abstain from voting.

 

How do I vote by proxy?

 

Follow the instructions on the enclosed proxy card.  Sign and date the proxy card and mail it back to us in the enclosed envelope. If you receive more than one proxy card it may mean that you hold shares in more than one account. Sign and return all proxy cards to ensure that all of your shares are voted. The proxy holder named on the proxy card will vote your shares as you instruct. If you sign and return the proxy card but do not indicate your vote, the proxy holder will vote on your behalf “FOR” each of the Proposals as noted above.

 

Can I vote via the Internet?

 

Stockholders with shares registered in their names with BNY Mellon Shareowner Services, our transfer agent, may authorize a proxy via the Internet at the following address: http://www.proxyvote.com. A number of brokerage firms and banks participate in a program that permits Internet voting. If your shares are held in an account at a brokerage firm or bank that participates in such a program, you may direct the vote of those shares by following the instructions on the voting form enclosed with the proxy from the brokerage firm or bank.

 

Proxies submitted via the Internet must be received by 11:59 p.m. (EDT) on April 25, 2011. Please refer to your voting instruction form and/or your proxy card for specific voting instructions. If you vote this year’s proxy via the Internet, you may also elect to receive future proxy and other materials electronically by following the instructions when you vote. Making this election will save the Company the cost of producing and mailing these documents.

Can I change my vote after I return my proxy card?

 

Yes. At any time before the vote at the annual meeting, you can change your vote either by giving our Corporate Secretary a written notice revoking your proxy card, or by signing, dating and submitting a new proxy card. We will honor the latest dated proxy card which has been received prior to the closing of the voting. You may also attend the meeting and vote in person.

 

Can I vote in person at the annual meeting rather than by completing the proxy card?

 

Although we encourage you to complete and return the proxy card to ensure that your vote is counted, you can attend the annual meeting and vote your shares in person. If you wish to attend the annual meeting and vote your shares in person and you are the beneficial owner of your shares, you must obtain the documents required to vote your shares in person at the annual meeting from your broker, or other nominee.

 

Who will count the votes?

 

Broadridge Financial Solutions, Inc. has been appointed to receive and tabulate stockholder votes and to act as the inspector of election and certify to the election results.

 

Who is soliciting my vote?

 

The board of directors is soliciting your vote.

 

Who pays for this proxy solicitation?

 

The Company pays for the proxy solicitation. We will ask banks, brokers and other nominees and fiduciaries to forward the proxy material to the beneficial owners of the Class A common stock and to obtain the authority of executed proxies. We will reimburse them for their reasonable expenses.

 

Proposal No. 1: Election of Class A Directors
(Item 1 on Proxy Card)

 

The Company currently has eleven directors, each of whom is elected on an annual basis. The board of directors is soliciting your vote for the Class A directors to be elected at the annual meeting of stockholders. Once elected, each of the directors will hold office until his or her successor is elected, which we expect to occur at next year’s annual meeting of stockholders.

 

THE BOARD OF DIRECTORS RECOMMENDS VOTING “FOR” THE CLASS A DIRECTOR NOMINEES.

Information about the Class A Director Nominees

 

The following information concerns the eleven individuals who have been nominated by the board of directors for election by the Class A stockholders. Each of the following individuals currently serves as a Class A director.

 

 

Robert Cohn, 61, was elected to the board of directors of Charter on December 1, 2009. Most recently, Mr. Cohn has served as an independent investor and advisor to growing companies. From 2002 to 2004, Mr. Cohn was a partner with Sequoia Capital, a high-tech venture capital firm in Silicon Valley. Mr. Cohn was the founder of Octel Communications Corporation and was the company’s Chairman and CEO from its inception in 1982 until it was purchased by Lucent Technologies in 1997. Mr. Cohn has served on various boards of public and private companies, including Octel, Trimble Navigation, Electronic Arts, Digital Domain, Ashford.com and Blue Lithium. Mr. Cohn currently serves on the board of directors of Right Hemisphere, Market Live and Taboola and is a Trustee of Robert Ballard’s Ocean Exploration Trust. Mr. Cohn holds a Bachelor of Science degree in Mathematics and Computer Science from the University of Florida and a M.B.A. from Stanford University. We believe Mr. Cohn’s qualifications to sit on Charter’s board include his experience as an executive and director.

 

W. Lance Conn, 42, was elected to the board of directors of Charter on November 30, 2009. Mr. Conn previously served on Charter’s board of directors since September 2004. From July 2004 to May 2009, Mr. Conn served as the President of Vulcan Capital, the investment arm of Vulcan, Inc. Prior to joining Vulcan Inc., Mr. Conn was employed by America Online, Inc., an interactive online services company, from March 1996 to May 2003. Mr. Conn served as an officer of Charter Investment, Inc. prior to and during the time of its Chapter 11 bankruptcy proceedings filed concurrently with Charter’s Chapter 11 proceedings. Mr. Conn holds a J.D. degree from the University of Virginia, a M.A. degree in history from the University of Mississippi and an A.B degree in history from Princeton University. We believe Mr. Conn’s qualifications to sit on Charter’s board include his experience in the media business and as a director.

 

Darren Glatt, 35, was elected to the board of directors of Charter on November 30, 2009. Mr. Glatt is a Principal at Apollo Management, L.P. and has been with Apollo since 2006. Prior to joining Apollo, Mr. Glatt was a member of the Media Group at Apax Partners from 2004 to 2006, a member of the Media Group at the Cypress Group from 2000 to 2002, and a member of the Mergers & Acquisitions Group at Bear, Stearns & Co. from 1998 to 2000. Mr. Glatt received a M.B.A. from the Harvard Business School and graduated from George Washington University’s School of Business & Public Management. We believe Mr. Glatt’s qualifications to sit on Charter’s board include his experience in media, banking and investments industries.

 

Craig A. Jacobson, 58, was elected to the board of directors of Charter on July 27, 2010. Mr. Jacobson is a founding partner at the law firm of Hansen, Jacobson, Teller, Hoberman, Newman, Warren & Richman, L.L.P., where he has practiced entertainment law for the past 20 years. Mr. Jacobson is a member of the Board of Directors of Expedia, Inc. and Aver Media, a privately held Canadian lending institution. Mr. Jacobson was a director of Ticketmaster from August 2008 until its merger with Live-Nation, Inc. in January 2010. Mr. Jacobson received his Bachelor of Arts degree from Brown University in 1974, where he was a member of Phi Beta Kappa, and his J.D.

degree with Honors from George Washington University School of Law. We believe Mr. Jacobson’s qualifications to sit on Charter’s board include his media and business experience.

 

Bruce A. Karsh, 55, was elected to the board of directors of Charter on November 30, 2009. Since 1995, Mr. Karsh has served as President and co-founder of Oaktree Capital Management, L.P., formerly Oaktree Capital Management, LLC, a Los Angeles- based investment management firm. Prior to co-founding Oaktree, Mr. Karsh was a Managing Director of Trust Company of the West (“TCW”) and its affiliate, TCW Asset Management Company, and the portfolio manager of the Special Credits Funds for seven years. Prior to joining TCW, Mr. Karsh worked as Assistant to the Chairman of Sun Life Insurance Company of America and of SunAmerica, Inc., its parent. Prior to that, he was an attorney with the law firm of O’Melveny & Myers. Mr. Karsh holds an A.B. degree in Economics from Duke University and a J.D. from the University of Virginia School of Law. Mr. Karsh serves as the Chairman of the Board of Directors for Duke University’s investment management company and serves as a director of Oaktree Capital Group, LLC, LBI Media Holdings, Inc. and LBI Media, Inc. During the last five years, Mr. Karsh has also served as a director of Littelfuse, Inc. We believe Mr. Karsh’s qualifications to sit on Charter’s board include his business and investment experience.

 

Edgar Lee, 35, was elected to the board of directors of Charter on January 18, 2011. He is Senior Vice President of Oaktree Capital Management, L.P. Mr. Lee joined Oaktree Capital Management in 2007. From 2005 to 2007, Mr. Lee was an Associate Director in the TMT Investment Banking division of UBS Investment Bank in Los Angeles. Prior to UBS, Mr. Lee was an Associate in the Fixed Income Division at Lehman Brothers Inc. Mr. Lee received a B.A. in Economics from Swarthmore College and a M.P.P. with a concentration in Applied Economics from Harvard University. We believe Mr. Lee’s qualifications to sit on Charter’s board include his business and investment experience.

 

Michael J. Lovett, 49, was elected a director and President and Chief Executive Officer of the Company on April 12, 2010, having previously served as Interim President and Chief Executive Officer and Chief Operating Officer from February 28, 2010 through April 12, 2010. Mr. Lovett previously served as Executive Vice President and Chief Operating Officer since 2005. Prior to that, he served as Executive Vice President, Operations and Customer Care from September 2004 through March 2005; as Senior Vice President, Midwest Division Operations; and as Senior Vice President of Operations Support of Charter from August 2003 through September 2004. Mr. Lovett was Chief Operating Officer of Voyant Technologies, Inc., from December 2001 to August 2003 and from November 2000 to December 2001, he was Executive Vice President of Operations for OneSecure, Inc. Prior to that, Mr. Lovett served in a number of operating and leadership positions at AT&T and Jones Intercable. Mr. Lovett served as an executive officer of Charter during the pendency of its Chapter 11 cases in 2009. We believe that Mr. Lovett’s qualifications to sit on our board include his many years of experience as an executive in the media industry.

 

John D. Markley, Jr., 45, was elected to the board of directors of Charter on November 30, 2009. Since 1996, Mr. Markley has been affiliated with Columbia Capital, a communications, media and technology investment firm, where he has served in a number of capacities, including portfolio company executive, general partner and venture partner. Prior to joining Columbia Capital, Mr. Markley served at the Federal Communications Commission, where he developed U.S. Government wireless communications and spectrum auction policy. He also held positions in corporate finance for Kidder, Peabody & Co. in both New York City and Hong Kong. Mr. Markley is a director of Telecom Transport Management, Inc., Broadsoft Inc., and Millennial Media, Inc. He received a B.A. degree from Washington and Lee University and a M.B.A. from Harvard University. We believe Mr. Markley’s qualifications to sit on Charter’s board include his experience in the telecommunications and media industries.

 

David C. Merritt, 56, was elected to the board of directors of Charter on December 15, 2009, and was also appointed as Chairman of Charter’s Audit Committee at that time. Mr. Merritt previously served on Charter’s board and Audit Committee since 2003. Effective March 2009, he is the president of BC Partners, Inc., a financial advisory firm. From October 2007 to March 2009, Mr. Merritt served as Senior Vice President and Chief Financial Officer of iCRETE, LLC. From October 2003 to September 2007, Mr. Merritt was a Managing Director of Salem Partners, LLC, an investment banking firm. Mr. Merritt is a director of Outdoor Channel Holdings, Inc. and of Calpine Corporation and currently serves as Chairman of the Audit Committee of each company. He is also a director of Buffet Holdings, Inc. From 1975 to 1999, Mr. Merritt was an audit and consulting partner of KPMG

serving in a variety of capacities during his years with the firm, including national partner in charge of the media and entertainment practice. Mr. Merritt holds a Bachelor of Science degree in Business and Accounting from California State University — Northridge. We believe Mr. Merritt’s qualifications to sit on Charter’s board include his many years of experience with a major accounting firm, as a director and audit committee member, and in the media industry.

 

Stan Parker, 34, was elected to the board of directors of Charter on January 18, 2011. He is a senior partner of Apollo Global Management LLC, having joined the firm as an associate in 2000. Prior to that time, Mr. Parker was employed by Salomon Smith Barney, Inc. in its Financial Entrepreneurs Group within the Investment Banking Division. Mr. Parker also serves on the board of directors of AMC Entertainment Inc., AMC Entertainment Holdings, Inc., Affinion Group, CEVA Logistics and Momentive Performance Materials. Mr. Parker holds a B.S. degree in Economics from The Wharton School of Business at the University of Pennsylvania. We believe Mr. Parker’s qualifications to sit on Charter’s board include his business and investment experience.

 

Eric L. Zinterhofer, 39, was elected to the board of directors of Charter on November 30, 2009 and as non-executive Chairman of the board on December 1, 2009. In 2010, Mr. Zinterhofer founded Searchlight Capital Partners, LLC, a private equity firm. Previously, he served as a senior partner at Apollo Management, L.P. and was with Apollo from 1998 until May 2010. From 1994 to 1996, Mr. Zinterhofer was a member of the Corporate Finance Department at Morgan Stanley Dean Witter & Co. From 1993 to 1994, Mr. Zinterhofer was a member of the Structured Equity Group at J.P. Morgan Investment Management. Mr. Zinterhofer is a director of Central European Media Enterprises Ltd., and Dish TV India Ltd. In the past five years, Mr. Zinterhofer was a director of iPCS, Inc, Unity Media SCA and Affinion Group, Inc. Mr. Zinterhofer received B.A. degrees in Honors Economics and European History from the University of Pennsylvania and received a M.B.A. from Harvard Business School. We believe Mr. Zinterhofer’s qualifications to sit on Charter’s board include his experience as a director and in the banking and investment industries.

 

Board of Directors and Committees of the Board of Directors

 

Our board of directors meets regularly throughout the year on an established schedule. The board also holds special meetings and acts by written consent from time to time as necessary. The Company has not held an annual meeting for the past two years, but members of the board of directors are encouraged to attend the annual meeting each year. In 2010, the full board of directors held eleven meetings and acted two times by written consent. No incumbent director attended fewer than 75% of the total number of meetings of the board and of committees on which he or she served.

 

The board of directors delegates authority to act with respect to certain matters to board committees whose members are appointed by the board. The committees of the board of directors include the following: Audit Committee, Compensation and Benefits Committee, Nominating and Corporate Governance Committee, Section 162(m) and Finance Committee. The Audit, Compensation and Benefits and Nominating and Governance Committees each has a charter which is available on our website, www.charter.com.

 

Charter’s Audit Committee consisted of Messrs. Merritt, Jacobson and Christopher M. Temple in 2010. Mr. Temple resigned from the board of directors in January 2011 and Mr. Markley was appointed to succeed him on the Audit Committee. Mr. Merritt is Chairman of the Audit Committee. Charter’s board of directors has determined that, in its judgment, Mr. Merritt is an audit committee financial expert within the meaning of the applicable federal regulations. All members of the Audit Committee were determined by the board in 2010 to be independent in accordance with the listing standards of the NASDAQ Global Select Market. The Audit Committee met eight times in 2010.

 

The Compensation and Benefits Committee, which has a written charter approved by the board, reviews and approves the Company’s compensation of the senior management of the Company and its subsidiaries. The Committee is comprised of Messrs. Conn, Cohn and Zinterhofer. Mr. Conn is Chairman of the Committee. All members of the Compensation and Benefits Committee were determined by the board in 2010 to be independent in accordance with the listing standards of the NASDAQ Global Select Market. The Compensation and Benefits Committee met nine times in 2010 and executed three unanimous consents in lieu of meetings.

The Nominating and Corporate Governance Committee members in 2010 were Messrs. Karsh, Markley and William L. McGrath. Mr. McGrath resigned from the board of directors in January 2011 and Mr. Parker was appointed to succeed him on the Nominating and Governance Committee. In addition, when Mr. Markley was appointed to the Audit Committee, he was replaced on the Nominating and Corporate Governance Committee by Mr. Lee. Mr. Karsh is Chairman of the Committee. All members of the Nominating and Governance Committee were determined by the board in 2010 to be independent in accordance with the listing standards of the NASDAQ Global Select Market. The Nominating and Corporate Governance Committee met four times in 2010.

 

The Section 162(m) Committee reviews the Company’s compensation for purposes of qualifying as performance-related compensation and thus meeting the provisions under Internal Revenue Code 162(m) for deductibility. The Committee is comprised of Messrs. Cohn and Markley and it met three times in 2010.

 

From time to time, the board may create “ad hoc” committees for specific projects or transactions. In 2010, the board appointed an ad hoc Finance Committee to review the Company’s financing activities and approve the terms and conditions of certain financing transactions referred to it by the board, in consultation with the Company’s legal and financial advisors. The Finance Committee in 2010 consisted of Messrs. Karsh, Merritt and Zinterhofer and met five times during the year.

 

The Company’s Nominating and Corporate Governance Committee of the board of directors has determined that Messrs. Cohn, Conn, Jacobson, Markley and Merritt are independent directors under NASDAQ rules as was Mr. Temple. Messrs. Glatt, Karsh, Lee, Parker and Zinterhofer are independent under the NASDAQ rules as was Mr. McGrath; however, their status or relationship with an affiliate of the Company prohibits an independence finding under SEC rules for Audit Committee membership purposes. Mr. Lovett is Chief Executive Officer of the Company and is thus not independent.

 

Nomination and Qualifications of Directors

 

Candidates for director are nominated by the board of directors, based on the recommendation of the Nominating and Corporate Governance Committee. Charter’s Corporate Governance Guidelines provide that, among other things, that candidates for new board members to be considered by the Charter’s board of directors should be individuals from diverse business and professional backgrounds with unquestioned high ethical standards and professional achievement, knowledge and experience. Candidates should include diversity of gender, race and national origin, education, professional experience and differences in viewpoints and skills. The Nominating and Corporate Governance Committee does not have a formal policy with respect to diversity; however, the board of directors and the Nominating and Corporate Governance Committee believe that it is essential that board members represent diverse viewpoints. In considering candidates for the Board, the Nominating and Corporate Governance Committee considers the entirety of each candidate’s credentials in the context of these standards. In addition, director candidates must be individuals with the time and commitment necessary to perform the duties of a board member and other special skills that complement or supplement the skill sets of current directors.

 

Stockholders may nominate persons to be directors by following the procedures set forth in our Bylaws. These procedures require the stockholder to deliver timely notice to the Corporate Secretary at our principal executive offices. That notice must contain the information required by the Bylaws about the stockholder proposing the nominee and about the nominee. No stockholder nominees have been proposed for this year’s meeting.

 

Stockholders also are free to suggest persons for the board of directors to consider as nominees. The board of directors will consider those individuals if adequate information is submitted in a timely manner (see “Stockholders Proposal for 2012 Annual Meeting” below for deadline requirements) in writing to the board of directors at the Company’s principal executive offices, in care of the General Counsel. The board of directors may, however, give less serious consideration to individuals not personally known by the current board members.

 

Board Leadership Structure and Risk Oversight

 

We separate the roles of CEO and Chairman of the board in recognition of the differences between the two roles. The CEO is responsible for setting the strategic direction for the Company and the day to day leadership and

performance of the Company, while the Chairman of the board provides guidance to the CEO and presides over meetings of the full Board. We could decide to combine these positions in the future.

 

The full board of directors oversees the various risks to the Company, delegating to the various committees specific responsibilities. The Audit Committee reviews our Enterprise Risk Management (“ERM”) Program on a regular basis. The Audit Committee meets regularly with members of management in executive session, as well as with the Chief Compliance Officer, the Vice President of Internal Audit Services and representatives of our independent outside accounting firm. The Compensation and Benefits Committee oversees our compensation policies and practices, including reviewing our incentive and equity-based compensation plans and benefits plans. The Nominating and Corporate Governance Committee oversees corporate governance, including recommending board and committee nominations, the corporate guidelines and director independence.

 

Stockholder Contact with Directors

 

Individuals may communicate directly with members of the board of directors or members of the board’s standing committees by writing to the following address:

 

Charter Communications, Inc.
12405 Powerscourt Drive
St. Louis, Missouri 63131
Attn: Corporate Secretary

 

The Corporate Secretary will summarize all correspondence received, subject to the standards below, and periodically forward summaries to the board. Members of the board may at any time request copies of any such correspondence. Communications may be addressed to the attention of the board, a standing committee of the board, or any individual member of the board or a committee. Communication that is primarily commercial in nature, relates to an improper or irrelevant topic, or requires investigation to verify its content may not be forwarded.

 

2010 Director Compensation

 

As stated previously, upon Charter’s emergence from its Chapter 11 proceedings on November 30, 2009, a new board of directors was appointed pursuant to the Plan consisting of W. Lance Conn, Robert Cohn, Bruce Karsh, Darren Glatt, John D. Markley, Jr., William McGrath, Neil Smit, Christopher Temple and Eric Zinterhofer. David C. Merritt was subsequently elected to the board of directors in December 2009. Mr. Smit resigned in February 2010 and Mr. Lovett was appointed to fill that vacancy. Craig Jacobson was elected to the board of directors in July 2010. Messrs. McGrath and Temple resigned as directors in January 2011 and Edgar Lee and Stan Parker were elected to fill those vacancies.

 

On January 21, 2010, the board of directors approved a director compensation package. The package includes an annual retainer of $80,000 in cash and an annual award of $80,000 in restricted stock. In addition, the Audit Committee chair receives $20,000 per year, the Compensation and Benefits Committee chair receives $10,000 per year, and the chair of each other committee receives $7,500 per year. Each Audit Committee member receives $15,000 per year, each Compensation and Benefits Committee member receives $10,000 per year and all other committee members receive $7,500 per year.

 

Mr. Glatt (as to Apollo Management, L.P.), Mr. Karsh (as to Oaktree Capital Management, L.P.) and Mr. McGrath (as to Vulcan Inc.) each requested that all cash compensation they received for their participation on Charter’s board of directors or committees of the board be paid directly to their respective employers in accordance with their internal policies. Further, Mr. Glatt has declined the equity portion of his compensation for participation on Charter’s board of directors. Mr. Karsh accepted and retained the equity portion of his board compensation.

 

Directors who are employees do not receive additional compensation for board of directors’ participation. Mr. Lovett was the only director who was also an employee during 2010. Non-employee directors are not eligible for non-equity incentive compensation within the 2010 Executive Bonus Plan.

The following table sets forth information as of December 31, 2010 regarding the compensation to those non-employee members of the board of directors listed below for services rendered for the fiscal year ended December 31, 2010.

 

 

 

 

Indemnification

 

Our Bylaws provide that all directors are entitled to indemnification to the maximum extent permitted by law from and against any claims, damages, liabilities, losses, costs or expenses incurred in connection with or arising out of the performance by them of their duties for us or our subsidiaries.

Executive Officers

 

Our executive officers as of the date hereof, listed below, are elected by the board of directors annually, and each serves until his or her successor is elected and qualified or until his or her earlier resignation or removal.

 

 

Information regarding our executive officers, other than Mr. Lovett who serves as a director, is set forth below.

 

Christopher L. Winfrey, 35, Executive Vice President and Chief Financial Officer.  Mr. Winfrey joined Charter as Executive Vice President and Chief Financial Officer on November 1, 2010. Prior to joining Charter, Mr. Winfrey served as Chief Financial Officer and Managing Director of Unitymedia GmbH from March 2006 through October 2010. Mr. Winfrey was also appointed Managing Director of Unitymedia Management GmbH, Unitymedia Hessen Verwaltung GmbH and Unitymedia NRW GmbH in March 2006 and arena Sport Rechte und Marketing GmbH in April 2008. From December 2002 through December 2005, Mr. Winfrey served as Senior Vice President — Corporate Finance and Development at Cablecom GmbH. Mr. Winfrey was previously Director of Financial Planning and Analysis of NTL’s continental European operations and a Senior Associate in the private equity group at Communications Equity Associates. Mr. Winfrey graduated from the University of Florida, with a B.S. degree in Accounting. He also received his MBA from the University of Florida.

 

Donald F. Detampel, 55, Executive Vice President and President, Commercial Services.  Mr. Detampel joined Charter as Executive Vice President and President, Commercial Services in October 2010 and it has been announced that he will become Executive Vice President, Technology and President, Commercial Services on March 25, 2011. Prior to joining Charter, Mr. Detampel served as Senior Vice President, Business Services at Comcast Corporation from March 2010 through August 2010. Prior to that, Mr. Detampel served as an Executive Chairman and Board director of New Global Telecom, Inc. Prior to that, Mr. Detampel served as President and Chief Executive Officer and board director of Raindance Communications, Inc., a publicly traded multimedia conferencing company, from February 2004 through April 2006. Mr. Detampel currently serves on the boards of directors of Masergy Communications, Inc., Peer 1 Networks, Inc. and Zayo Group, LLC and also on the advisory board of Advanced Data Centers, Inc. Mr. Detampel received B.S. degrees, magna cum laude, in mathematics and physics, from St. Norbert College.

 

Gregory L. Doody, 46, Executive Vice President, Programming and Legal Affairs.  Mr. Doody was appointed to his current position on January 4, 2011 having previously served as Executive Vice President and General Counsel from December 1, 2009. Prior to that, he served as Charter’s Chief Restructuring Officer and Senior Counsel in connection with its Chapter 11 proceedings being appointed on March 25, 2009. Prior to coming to work for Charter, Mr. Doody served as Executive Vice President, General Counsel and Secretary of Calpine Corporation from July 2006 through August 2008. From July 2003 through July 2006, Mr. Doody held various positions at HealthSouth Corporation, including Executive Vice President, General Counsel and Secretary. Mr. Doody served as an executive officer of Charter during the pendency of its Chapter 11 cases in 2009. Mr. Doody earned a J.D. degree from Emory University School of Law and received a bachelor’s degree in management from Tulane University. Mr. Doody is a certified public accountant.

 

Marwan Fawaz, 48, Executive Vice President, Strategy and Chief Technology Officer.  It has been announced that Mr. Fawaz will be leaving the Company on March 25, 2011. Mr. Fawaz joined Charter as Executive Vice President and Chief Technology Officer in August 2006 and was promoted to his current position on January 4, 2011. From March 2003 until July 2006, Mr. Fawaz served as Senior Vice President and Chief Technical

Officer for Adelphia Communications Corporation (“Adelphia”). Adelphia filed a petition under Chapter 11 of the Bankruptcy Code in June 2002. From May 2002 to March 2003, he served as Investment Specialist/Technology Analyst for Vulcan, Inc. Mr. Fawaz served as Regional Vice President of Operations for the Northwest Region for Charter from July 2001 to March 2002. From July 2000 to December 2000, he served as Chief Technology Officer for Infinity Broadband. He served as Vice President — Engineering and Operations at MediaOne, Inc. from January 1996 to June 2000. Mr. Fawaz served as an executive officer of Charter during the pendency of its Chapter 11 cases in 2009. Mr. Fawaz received a B.S. degree in electrical engineering and a M.S. in electrical/communication-engineering from California State University — Long Beach.

 

Kevin D. Howard, 41, Senior Vice President — Finance, Controller and Chief Accounting Officer.  Mr. Howard was promoted to his position as Senior Vice President — Finance, Controller and Chief Accounting Officer in December 2009. From August 1, 2010 through October 31, 2010, Mr. Howard served as Interim Chief Financial Officer. From April 2006 to December 2009, Mr. Howard served as Vice President, Controller and Chief Accounting Officer. Prior to that, he served as Vice President of Finance from April 2003 until April 2006 and as Director of Financial Reporting since joining Charter in April 2002. Mr. Howard began his career at Arthur Andersen LLP in 1993 where he held a number of positions in the audit division prior to leaving in April 2002. Mr. Howard served as an executive officer of Charter during the pendency of its Chapter 11 cases in 2009. Mr. Howard received a bachelor’s degree in finance and economics from the University of Missouri — Columbia and is a certified public accountant and certified managerial accountant.

 

Richard R. Dykhouse, 47, Senior Vice President, General Counsel and Corporate Secretary.  Mr. Dykhouse was promoted to his current position on January 4, 2011 having previously been a Vice President of Charter since 2006 serving most recently as Vice President, Associate General Counsel and Corporate Secretary. Prior to joining Charter, Mr. Dykhouse was Senior Counsel and Assistant Secretary for CNH Global, N.V. from 2004 to 2006 and was an attorney for Conseco, Inc. from 1994 to 2003 serving in the corporate law group with his last position as a Senior Vice President, Legal. Mr. Dykhouse received a bachelor’s degree in finance from Olivet Nazarene University, a M.B.A. from Indiana University and a J.D. degree from Indiana University School of Law — Indianapolis.

 

Executive Compensation

 

Compensation Committee Interlocks and Insider Participation

 

During 2010, no member of Charter’s Compensation and Benefits Committee was an officer or employee of Charter or any of its subsidiaries during 2010. Mr. Zinterhofer served as the non-executive Chairman of the Board in 2010.

 

During 2010, (1) none of Charter’s executive officers served on the compensation committee of any other company that has an executive officer currently serving on Charter’s board of directors or Compensation and Benefits Committee and (2) none of Charter’s executive officers served as a director of another entity, one of whose executive officers served on the Compensation and Benefits Committee.

 

Report of the Compensation and Benefits Committee

 

The following report does not constitute soliciting materials and is not considered filed or incorporated by reference into any other filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, unless we specifically state otherwise.

 

The Compensation and Benefits Committee has reviewed and discussed with management the Compensation Discussion and Analysis (“CD&A”) set forth below including the accompanying tables and recommended to the board of directors that it be included in this proxy statement.

 

W. LANCE CONN, Chairman

ROBERT COHN

ERIC ZINTERHOFER

 

Compensation Discussion and Analysis

 

The following discussion and analysis of compensation arrangements of our Named Executive Officers (including our Chief Executive Officer, Chief Financial Officer, and other executive officers appearing in the Summary Compensation Table) should be read together with the compensation tables and related disclosures set forth elsewhere in this proxy statement.

 

Role of the Compensation and Benefits Committee

 

The Compensation and Benefits Committee of our board of directors is responsible for overseeing our overall compensation structure, policies and programs and assessing whether our compensation structure results in appropriate compensation levels and incentives for executive management and employees.

 

Our CEO annually reviews the performance of each of the other Named Executive Officers. He recommends to the Compensation and Benefits Committee salary adjustments, annual cash bonuses and equity incentive compensation applying specific performance metrics that have been approved by the Compensation and Benefits Committee at the beginning of each year for the other Named Executive Officers. The Compensation and Benefits Committee has, on occasion, requested the CEO to be present at Compensation and Benefits Committee meetings where executive compensation and Charter and individual performance are discussed and evaluated. The CEO is invited for the purpose of providing insight or suggestions regarding executive performance objectives and/or achievements, and the overall competitiveness and effectiveness of our executive compensation program. Although the Compensation and Benefits Committee considers the CEO’s recommendations along with analysis provided by the Compensation and Benefits Committee’s compensation consultants, it retains full discretion to set all compensation for our Named Executive Officers, except that the Compensation and Benefits Committee’s recommendations for the CEO’s compensation goes before Charter’s full board of directors, with non-employee directors voting on the approval of any recommendations, subject to any employment agreements.

 

The Compensation and Benefits Committee has the discretion to directly engage the services of a compensation consultant(s) or other advisors. Semler Brossy Consulting Group, LLC (“Semler Brossy”) was retained directly by the Compensation and Benefits Committee and has conducted a comprehensive assessment of our annual executive compensation program relative to competitive markets, as well as conducted an analysis on certain retention strategies for our senior management team. In carrying out its assignments, Semler Brossy also interacted with management when necessary and appropriate. Semler Brossy may, in its discretion, seek input and feedback from management regarding its consulting work product prior to presentation to the Compensation and Benefits Committee in order to confirm alignment with our business strategy, and identify data questions or other similar issues, if any. During 2010, Semler Brossy provided no services to the Company other than its advice to the Compensation and Benefits Committee on executive compensation issues.

 

Compensation Philosophy and Objectives

 

The Compensation and Benefits Committee believes that attracting and retaining well-qualified executives is a top priority. The Compensation and Benefits Committee’s approach is to compensate executives commensurate with their experience, expertise and performance and to ensure that our compensation programs are competitive with executive pay levels within the cable, telecommunications, and other related industries that define our competitive labor markets. We seek to uphold this philosophy through attainment of the following objectives:

 

Pay-for-Performance.  We seek to ensure that the amount of compensation for each Named Executive Officer is reflective of the executive’s performance and service to us for the time period under consideration. Our primary measures of performance used to gauge appropriate levels of performance-based compensation have included revenue, Adjusted EBITDA, Adjusted EBITDA less capital expenditures, operating cash flow, operational improvements, customer satisfaction, and/or such other metrics as the Compensation and Benefits Committee shall determine is then critical to our long-term success at that time. While we believe that our executives are best motivated when they believe that their performance objectives are attainable, we also believe that these metrics should be challenging and represent important improvements over performance in prior years. Compensation payable pursuant to our annual Executive Bonus Plan and our Long-Term Incentive Program is dependent on our performance.

Alignment.  We seek to align the interests of the Named Executive Officers with those of our investors by evaluating executive performance on the basis of the financial measurements noted above, which we believe closely correlate to long-term stakeholder value creation. The annual cash bonus and long-term incentives are intended to align executive compensation with our business strategies, values and management initiatives, both short- and long-term. Through this incentive compensation, we place a substantial portion of executive compensation at risk, specifically dependent upon our financial performance over the relevant periods. This rewards executives for performance that enhances our financial strength and stakeholder value.

 

Retention.  We recognize that a key element to our success is our ability to retain a team of highly-qualified executives who can provide the leadership necessary to successfully execute our short- and long-term business strategies. We also recognize that, because of their qualifications, our senior executives are often presented with other professional opportunities, potentially ones at higher compensation levels. It is often difficult to retain talented management. Our retention strategy faces additional challenges in that the skills of our current management team are attractive to many companies inside and outside of the cable industry and several members of our management team do not have long-standing ties to the St. Louis area where our headquarters is located. The following programs underscore our focus on retention. First, the Executive Cash Award Plan and Top Talent Retention Plan provided for cash awards to be paid at the end of pre-determined periods, but the Executive Cash Award Plan was modified and cancelled in the first quarter of 2009 and payments to certain recipients under the Top Talent Retention Plan were accelerated and paid out in the first quarter of 2009; all as discussed in detail below. Second, a revised Long-Term Incentive Program was approved in March 2008 and modified in February 2009, and is also discussed below. In addition, the Value Creation Plan was approved by the board of directors in 2009. These plans are described below.

 

Pay Levels and Competitive Analysis

 

Pay levels for executives are determined based on a number of factors, including the individual’s roles and responsibilities within Charter, the individual’s experience and expertise, pay levels for peers within Charter, pay levels in the marketplace for similar positions, and performance of the individual and Charter as a whole. In determining these pay levels, the Compensation and Benefits Committee considers all forms of compensation and benefits. When establishing the amounts of such compensation, the Compensation and Benefits Committee considers publicly available information, such as proxy statements, as well as third-party administered benchmark surveys concerning executive compensation levels paid by other competitors and in the industry generally.

 

With the assistance of Semler Brossy, the Compensation and Benefits Committee approved a peer group of the following 21 publicly-traded companies for benchmarking executive compensation effective for 2010: BCE Inc., Cablevision Systems Corp., CenturyLink Inc., Comcast Corporation, The DIRECTV Group, Inc., Dish Network group, Frontier Communications Corp., Global Crossing Ltd., Leap Wireless International Inc., Level 3 Communications, Inc., Mediacom Communications Corp., MetroPCS Communications Inc., Qwest Communications International Inc., Rogers Communications Inc., Shaw Communications Inc., Sirius XM Radio, Inc., Telephone and Data Systems Inc., TELUS Corp., Time Warner Cable Inc., United States Cellular Corp. and Windstream Corp. These companies include companies in cable, telecommunications or other related industries of similar size and business strategy. Consistent with our practice, and in light of recent transactions within the peer group, the Committee plans to revisit peer group composition again when benchmarking pay later this year.

 

In addition to these specific peer companies, the Compensation and Benefits Committee also reviews data from a number of published compensation surveys that provide broader market data for specific functional responsibilities for companies of similar revenue size to us.

 

After consideration of the data collected on external competitive levels of compensation and internal relationships within the executive group, the Compensation and Benefits Committee makes decisions regarding individual executives’ target total compensation opportunities based on the need to attract, motivate and retain an experienced and effective management team.

 

In light of our practice of making a relatively high portion of each executive officer’s compensation based on performance (i.e., at risk), the Compensation and Benefits Committee generally examines peer company data at the 50th percentile (i.e., the median) and the 75th percentile, for performance at target and in excess of target, respectively, or for specialization of a skill set. The Compensation and Benefits Committee generally sets target

compensation for our executive group at the median of the market data with the opportunity to reach the 75th percentile based on superior performance relative to the criteria above.

 

As noted above, notwithstanding our overall pay positioning objectives, pay opportunities for specific individuals vary based on a number of factors such as scope of duties, tenure, experience and expertise, institutional knowledge and/or difficulty in recruiting a new executive. Actual total compensation in a given year will vary above or below the target compensation levels based primarily on the attainment of operating goals and the preservation of stakeholder value. Based on data provided by our outside advisor, target total direct compensation (i.e. salary, bonus and long-term incentive) for 2010 was, on average, between median and 75th percentile levels for the Named Executive Officer group, set forth in the Summary Compensation Table below.

 

Pay Mix

 

We utilize the particular elements of compensation because we believe that it provides a well-proportioned mix of total opportunity, retention value and at-risk compensation which produces short-term and long-term performance incentives and rewards. By following this portfolio approach, we provide the executive a measure of stability in the minimum level of compensation the executive is eligible to receive, while motivating the executive to focus on the business metrics and actions that will produce a high level of performance for Charter, as well as reducing the risk of recruitment of top executive talent by competitors.

 

For key executives, the mix of compensation is weighted toward at-risk pay (annual incentives and long-term incentives). We believe that maintaining this pay mix results in a fundamental pay-for-performance orientation for our executives. We also believe that long-term incentives, and particularly equity compensation, provide a very important motivational and retentive aspect to the compensation package of our key executives. All equity awarded as compensation prior to 2009 was cancelled as part of our reorganization plan consummated upon our exit from Chapter 11 bankruptcy. We adopted a new stock incentive plan after emergence from bankruptcy in November 2009 and awards were made to executives under this new plan in December 2009 and in July 2010.

 

Implementing Our Objectives

 

The Compensation and Benefits Committee makes compensation decisions after reviewing our performance and carefully evaluating an executive’s performance during the year against pre-established goals, leadership qualities, operational performance, business responsibilities, career with Charter, current compensation arrangements and long-term potential to enhance stakeholder value. Specific factors affecting compensation decisions for the Named Executive Officers include:

 

 

Elements Used to Achieve Compensation Objectives

 

The main components of our compensation program include:

 

 

 

Details of Each Compensation Element

 

 

Base Salaries are set with regard to the level of the position within Charter and the individual’s current and sustained performance results. The Base Salary levels for executives, and any changes in those salary levels, are reviewed each year by the Compensation and Benefits Committee, and such adjustments may be based on factors such as new roles and/or responsibilities assumed by the executive and the executive’s significant impact on our then current goals. Salary adjustments may also be based on changes in market pay levels for comparable positions in our competitive markets. Base Salaries are reviewed and adjusted with regard to (a) market competitive Base Salary levels and increases, (b) the employee’s impact on and contributions to the business performance, and (c) company-wide total salary increase budgets. On his appointment to the position of President and Chief Executive Officer, Mr. Lovett received a base salary increase of $542,821. During 2010, Mr. Howard received a base salary increase of $8,000 as part of a management-level pay alignment for certain individuals. During his time as Interim Chief Financial Officer, Mr. Howard received a base salary increase of $144,000 for taking on the additional duties and responsibilities. On his appointment to the position of Executive Vice President — Operations and Chief Technology Officer, Mr. Fawaz received a base salary increase of $163,242. During 2010, Mr. Schremp received base salary increases of $170,000 in the aggregate as part of a management-level pay alignment for certain individuals and for his appointment to the position of Executive Vice President, Operations and Marketing. During 2010, Mr. Doody’s base salary was adjusted to $500,000 from his prior annual base salary of $720,000 upon execution of his employment agreement dated July 27, 2010. On his appointment to the position of Executive Vice President, Programming and Legal Affairs, effective December 19, 2010, Mr. Doody received a base salary increase equal to $50,000.

 

There is no specific weighting applied to any one factor in setting the level of salary, and the process ultimately relies on the subjective exercise of the Compensation and Benefits Committee’s judgment. Although salaries are generally targeted at market median compared to an industry peer group and other compensation survey data for experienced professionals, the Compensation and Benefits Committee may also take into account historical compensation, potential as a key contributor as well as special recruiting/retention situations in setting salaries for individual executives above or below the market median. Based upon data provided by Semler Brossy, Base Salaries for our Named Executive Officers are generally at median competitive levels.

 

 

2010 Executive Bonus Plan

 

For 2010, bonuses for eligible employees were determined based on Charter’s (or, if applicable, an employee’s particular operating group’s or Key Market Area’s (“KMA”)) performance during 2010 measured against four performance goals or measures. These measures, and the percentage of an employee’s bonus allocated to each measure, are revenue (20%), adjusted EBITDA for corporate employees or operating cash flow for operating group and KMA employees (30%), adjusted EBITDA less capital expenditures (30%) and Customer Excellence Index Plus (“CEI+”) (20%). Target bonuses for executive officers ranged from 65% to 165% of base salary in 2010, subject to applicable employment agreements (see “Employment Agreements”). The range of potential payouts relative to target range from 10% to 150% of target bonus amounts. (Adjusted EBITDA is defined as consolidated net income (loss) plus net interest expense, income taxes, depreciation and amortization, reorganization items, stock compensation expense, loss on extinguishment of debt and other operating expenses, such as special charges and

loss on sale or retirement of assets; and operating cash flow is defined as Adjusted EBITDA plus management fee expenses.)

 

On February 22, 2011, the Compensation and Benefits Committee determined that achievement toward performance goals for 2010 resulted in bonuses under the 2010 Executive Bonus Plan at the corporate level in the amount of 126.4% of targeted bonuses, as detailed in the following chart and as set forth in the Non-Equity Incentive Plan column of the Summary Compensation Table.

 

 

The Compensation and Benefits Committee has the discretion to increase or decrease payouts under this annual plan based on organizational factors such as acquisitions or significant transactions, performance driven by changes in products or markets and other unusual, unforeseen or exogenous situations.

 

 

Our long-term incentive award compensation program is designed to recognize scope of responsibilities, reward demonstrated performance and leadership, motivate future superior performance, align the interests of the executive with that of our stakeholders, and incent and retain the executives through the term of the awards. We believe that performance-based incentives help to drive our performance through their direct linkage to controllable business results while, at the same time, rewarding executives for the value created through share price appreciation. While the size of the award is ultimately left to the Compensation and Benefits Committee discretion, grant levels are generally targeted at the median to top quartile of competitive levels.

 

Stock Incentive Plan

 

The 2001 Stock Incentive Plan, under which grants of equity were made to employees prior to 2009, was terminated upon our emergence from bankruptcy and all outstanding awards were cancelled. The 2009 Stock Incentive Plan provides for the potential grant of non-qualified stock options, stock appreciation rights, dividend equivalent rights, performance units and performance shares, share awards, phantom stock and shares of restricted stock as each term is defined in the 2009 Stock Incentive Plan and in the discretion of the Compensation and Benefits Committee. Unless terminated sooner, the 2009 Stock Incentive Plan will terminate on April 28, 2019, and no option or award can be granted thereafter under that plan. Pursuant to our plan of reorganization, upon emergence from bankruptcy, we included an allocation to the 2009 Stock Incentive Plan of a number of shares of new Charter Class A common stock equaling up to approximately 3% of the Class A common stock outstanding and grants of 50% of the amount were to be made to participants within 30 days of emergence from bankruptcy. Immediately upon emergence, the 2009 Stock Incentive Plan included 3,848,393 shares. On December 16, 2009, the board of directors approved the inclusion of another 3,848,393 shares in the 2009 Stock Incentive Plan and made initial grants of awards under the 2009 Stock Incentive Plan.

 

As of December 31, 2010, 4,817,818 shares remained available for future grants under the plan. As of December 31, 2010, there were 1,254 participants in the 2009 plan. See the Summary Compensation Table below for the awards received by our Named Executive Officers in 2010.

 

The 2009 Stock Incentive Plan authorizes the repricing of options, which could include reducing the exercise price per share of any outstanding option, permitting the cancellation, forfeiture or tender of outstanding options in exchange for other awards or for new options with a lower exercise price per share, or repricing or replacing any outstanding options by any other method.

Long-Term Incentive Program

 

Grants of equity compensation in the form of stock options, restricted shares and performance units were previously made to participants including the Named Executive Officers through our Long-Term Incentive Program (“LTIP”), which was originally administered under the 2001 Stock Incentive Plan.

 

As noted above, the 2001 Stock Incentive Plan was terminated upon our emergence from bankruptcy and all awards prior to 2009, including those to the Named Executive Officers, were forfeited. In addition, because of the participation by the Named Executive Officers in the Value Creation Plan, described below, none of the Named Executive Officers, except for Mr. Howard, received an LTIP award in 2009. In 2010, grants of stock options were made to eligible participants in the LTIP, including the Named Executive Officers, with an exercise price at fair market value and a vesting schedule of 25% on March 1st of each of the 4 years following the year of the grant.

 

The amount and type of incentive compensation granted in 2010 (stock options) was based upon our overall strategic, operational and financial performance and reflects the participant’s expected contributions to our future success. In 2008, the Compensation and Benefits Committee had changed the mix of awards made to individuals under the LTIP, to include a performance cash component as well as equity, and in 2009, we further changed the nature of the awards to include both a performance cash component, subject to adjustment in 2010, and a restricted cash component, but no equity due to our status in Chapter 11.

 

In 2010, the Compensation and Benefits Committee approved the adjustment of the performance cash awards, at the level of attainment of 150.1% of the 2009 cash awards as a result of the achievement of the financial performance measures. The level of award attainment was based on revenue growth of 4.5% versus a target of 7.0% and adjusted EBITDA less capital expenditures of 22.2% versus a target of 15.4%. One-third of these performance cash awards, along with the restricted cash awards are scheduled to vest in each of 2010, 2011 and 2012, respectively. In February 2010, the board of directors also approved the winding down of the performance cash program. Charter has paid or will pay out one-third of the remaining performance cash award balances in each of 2010, 2011 and 2012 to the participants, thus ending this component of the program.

 

Timing of Equity Grants

 

Grants of equity-based awards are determined by the Compensation and Benefits Committee and are typically made each calendar year following review by the Compensation and Benefits Committee of our prior year’s performance. Grants may also be made at other times of the year upon execution of a new employment agreement, or in a new hire or promotion situation. Grants of options, if made, have an exercise price equal to the average of the high and low stock price on the date of grant.

 

 

Value Creation Plan

 

In March 2009, we, after discussion with certain of our bondholders and upon the recommendation of our compensation consultant at the time, Towers Perrin, adopted the Value Creation Plan (the “VCP”) comprised of two components, the Restructuring Value Program (the “RVP”), and the Cash Incentive Program (the “CIP”).

 

The VCP provided incentives to encourage and reward the thirteen participants in the VCP critical to our restructuring, for the successful conclusion of the process. Participants who continued to be employed by us or our subsidiaries until payment of RVP awards earn payments under the RVP upon our emergence from our Chapter 11 restructuring proceeding (the “Proceeding”). The RVP payments were made in December 2009 to the participants. The amounts paid to the Named Executive Officers were as follows: Mr. Lovett — $2.38 million; Mr. Smit — $6 million; Mr. Howard — $125,000; Ms. Schmitz — $765,000; Mr. Fawaz — $765,000 and Mr. Schremp — $765,000.

 

The CIP provides annual incentives for participants to achieve specified individual performance goals during each of the three years following our emergence from bankruptcy. Reasonably attainable individual performance goals for each of the first three years following our emergence from bankruptcy were established by the CEO, and approved by the Compensation and Benefits Committee, within thirty days following our emergence from bankruptcy. Participants will earn all or a portion of their target award based on the degree to which these goals

are achieved in a particular year; provided that any amount not paid in a year other than the third year will be added to the amounts potentially payable upon the participant’s achievement of the performance goals in future years. The CEO may decrease (including to zero) any participant’s CIP awards at any time prior to their Vesting Date (as defined in the VCP). Any such reduction shall be used to increase the amounts otherwise payable under the CIP component, as applicable, to one or more other participants, as selected by the CEO, it being understood that the CEO may not increase his own award without the consent of the board of directors. Amounts that are not earned by a participant in a particular year may be earned by that participant in a subsequent year if the participant’s performance goals applicable to that subsequent year are achieved. Participants also fully vest in CIP payments upon an earlier of, or due to (i) a termination of their employment on or after our emergence from bankruptcy due to death, disability, by us for a reason other than “cause,” or voluntarily due to a “good reason” (as each such term is defined in the Plan) and (ii) a “change in control” of Charter if they are then employed by Charter. The first year’s performance goals were deemed to have been met by the Compensation and Benefits Committee and the first year’s awards were paid in November 2010 to our Named Executive Officers as follows: Mr. Lovett — $1 million; Mr. Howard — $350,000; Mr. Fawaz — $650,000 and Mr. Schremp — $480,000.

 

Executive Cash Award Plan

 

Charter previously adopted the Executive Cash Award Plan (“ECAP”) to provide additional incentive to, and retain the services of, certain officers of Charter and its subsidiaries, to achieve the highest level of individual performance and contribute to the success of Charter. Eligible participants were employees of Charter or any of its subsidiaries who have been recommended by the CEO and designated and approved as ECAP participants by the Compensation and Benefits Committee.

 

The ECAP provided that each participant be granted an award which represented an opportunity to receive cash payments in accordance with the ECAP. An award was credited in book entry format to a participant’s notional account in an amount equal to 100% of a participant’s base salary on the date of plan approval in 2005 and 20% of participant’s base salary in each year 2006 through 2009, based on that participant’s base salary as of May 1 of the applicable year. The ECAP awards vested at the rate of 50% of the ECAP award balance at the end of 2007 and 100% of the ECAP award balance was to vest at the end of 2009. Participants were entitled to receive payment of the vested portion of the award if the participant remained employed by Charter continuously from the date of the participant’s initial participation through the end of the calendar year in which his or her award became vested.

 

The ECAP was revised to allow the participation of new senior executives who became eligible for the plan beginning in 2006. In 2007, the plan was amended and restated to make it consistent with the 2001 Stock Incentive Plan to include the acceleration and payment of awards in the event of a change in control of Charter. Messrs. Smit, Lovett and Fawaz and Ms. Schmitz participated in this plan.

 

In December 2008, we announced that we were in discussions with certain of our bondholders about a potential financial restructuring of our balance sheet and as part of that process, the Compensation and Benefits Committee hired Towers Perrin as consultants to consider changes to senior management compensation. Based on recommendations of Towers Perrin, we determined that prepayment of amounts under the ECAP, subject to repayment obligation if the participants’ employment were terminated voluntarily or “for cause” prior to December 31, 2009 would provide a valuable retention incentive to ECAP participants. Therefore, the prepayment of all awards under the ECAP to all participants, including the Named Executive Officers, was made in January 2009. The prepayment was made at a discounted rate equal to 6% to account for the present value of such awards so prepaid. See the Summary Compensation Table below.

 

Top Talent Retention Plan

 

Charter previously adopted the Amended and Restated Top Talent Retention Plan (“TTRP”) to provide additional incentive to, and retain the services of, certain employees of Charter and its subsidiaries, to achieve the highest level of individual performance and contribute to the success of Charter. Eligible participants were employees of Charter or any of its subsidiaries who have been recommended by executive management and approved by the CEO.

 

The TTRP provided that each participant be granted an award which represented an opportunity to receive cash payments in accordance with the TTRP. An award was credited in book entry format to a participant’s notional account in an amount equal to 100% of a participant’s base salary on the date of plan approval or effective date of participation. Plan

awards did not increase subsequent to any salary increases after the effective date of the award or participation. For 2006 participants, the TTRP awards vested at the rate of 40% of the TTRP award on April 1, 2008 and 60% of the TTRP award on April 1, 2010. For 2007 participants, the TTRP awards vested at a rate of 40% of the TTRP award on April 1, 2009 and 60% of the TTRP award on April 1, 2011. Participants were entitled to receive payment of the vested portion of the award if the participant remained employed by Charter continuously from the date of the participant’s initial participation through the vesting date and provided that such participant has not been demoted prior to the vesting date.

 

Two of the Named Executive Officers, Kevin D. Howard and Ted W. Schremp, participated in this plan.

 

As noted previously, in December 2008, we announced that we were in discussions with certain of our bondholders about a potential financial restructuring of our balance sheet. In connection with Towers Perrin’s recommendation to accelerate payment under the ECAP, it was also recommended that prepayment of TTRP awards be made to insider-participants under the TTRP subject to the same repayment obligation for voluntary terminations by the employee or “for cause” terminations by the Company prior to December 31, 2009. Therefore, the prepayment of certain of the TTRP awards, including Messrs. Howard and Schremp, were made in January 2009. The prepayment was made at a discounted rate equal to 6% to account for the present value of such awards so prepaid. See the Summary Compensation Table below.

 

Other Compensation Elements

 

The Named Executive Officers participate in all other benefit programs offered to all employees generally.

 

An independent consultant was engaged to perform a risk assessment of the Company’s compensation programs and did not identify any risks that might adversely impact the financial health or performance of the Company.

 

Impact of Tax and Accounting

 

Section 162(m) of the Internal Revenue Code generally provides that certain kinds of compensation in excess of $1 million in any single year paid to the chief executive officer and the three other most highly compensated executive officers other than the chief financial officer of a public company are not deductible for federal income tax purposes. However, pursuant to regulations issued by the U.S. Treasury Department, certain limited exemptions to Section 162(m) apply with respect to qualified “performance-based compensation.” While the tax effect of any compensation arrangement is one factor to be considered, such effect is evaluated in light of our overall compensation philosophy. To maintain flexibility in compensating executive officers in a manner designed to promote varying corporate goals, the Compensation and Benefits Committee has not adopted a policy that all compensation must be deductible. Stock options and performance shares granted under our 2009 Stock Incentive Plan are subject to the approval of the Compensation and Benefits Committee. The grants qualify as “performance-based compensation” and, as such, are exempt from the limitation on deductions. Outright grants of restricted stock and certain cash payments (such as base salary and cash bonuses) are not structured to qualify as “performance-based compensation” and are, therefore, subject to the Section 162(m) limitation on deductions and will count against the $1 million cap.

 

When determining amounts and forms of compensation grants to executives and employees, the Compensation and Benefits Committee considers the accounting cost associated with the grants. We account for stock-based compensation in accordance with accounting standards regarding stock compensation which addresses the accounting for share-based payment transactions in which a company receives employee services in exchange for (a) equity instruments of that company or (b) liabilities that are based on the fair value of the company’s equity instruments or that may be settled by the issuance of such equity instruments. Under this accounting guidance, grants of stock options, restricted stock, performance shares and other share-based payments result in an accounting charge. The accounting charge is equal to the fair value of the instruments being issued on the date of the grant and is amortized over the requisite service period, or vesting period of the instruments. For restricted stock and performance shares, the cost is equal to the fair value of the stock on the date of grant times the number of shares or units granted. For stock options, the cost is equal to the fair value of the option on the date of the grant, estimated using the Black-Scholes option-pricing model, times the number of options granted. The following weighted average assumptions were used for grants during the years ended December 31, 2010 and 2008, respectively: risk-free interest rates of 2.5% and 3.5%; expected volatility of 47.7% based on historical volatility of a peer group and 88.1% based on historical volatility; and expected lives of 6.3 years and 6.3 years, respectively.

The valuations assume no dividends are paid. We did not grant stock options in 2009. Dollar values included in the “Non-Employee Director Compensation Table” and the “Summary Compensation Table” represent the aggregate fair value of all awards granted in 2010 and prior.

 

Events Relating to Equity Awards

 

In early 2009, due in part to the low stock trading price and our restructuring in bankruptcy, we offered employees who participated in the 2001 Stock Incentive Plan the option of forfeiting their grants of restricted stock and performance shares scheduled to vest in 2009. Messrs. Smit, Lovett, Fawaz, Howard and Schremp and Ms. Schmitz forfeited their shares and, therefore, there were no vesting events as to equity for them in 2009. All equity held by our named executive officers for the year 2008 was cancelled in connection with our emergence from bankruptcy. The compensation tables were prepared regarding compensation earned during the fiscal year ending December 31, 2010, 2009, and 2008.

 

Summary Compensation Table

 

The following table sets forth information as of December 31, 2010, 2009, and 2008 regarding the compensation to those executive officers listed below for services rendered for the fiscal years ended December 31, 2010, 2009, and 2008. As of December 31, 2010, these officers consist of: Michael J. Lovett, President and Chief Executive Officer; Neil Smit, former President and Chief Executive Officer; Christopher L. Winfrey, Executive Vice President and Chief Financial Officer; Kevin D. Howard, Senior Vice President — Finance, Controller and Chief Accounting Officer who also served the Company as Interim Chief Financial Officer during 2010; Eloise E. Schmitz, former Executive Vice President and Chief Financial Officer; and our three most highly compensated officers — Marwan Fawaz, Executive Vice President, Strategy and Chief Technology Officer; Gregory L. Doody, Executive Vice President, Programming and Legal Affairs and Ted W. Schremp, who previously served in the position of Executive Vice President, Operations and Marketing until his resignation on February 14, 2011.

 

 

 

 

 

 

2010 Grants of Plan Based Awards

 

 

 

 

Outstanding Equity Awards at Fiscal Year End

 

The following table provides information concerning unexercised options and unvested restricted stock for each of our Named Executive Officers that remain outstanding as of December 31, 2010.

 

 

 

 

2010 Options Exercised and Stock Vested

 

The following table provides information on restricted stock awards that vested during 2010 for each of the Company’s Named Executive Officers.

 

 

 

 

Retirement Benefits

 

We sponsor a 401(k) plan, which is a qualified retirement plan offered to all eligible employees, including our Named Executive Officers, that permits eligible employees to elect to defer a portion of their compensation on a pre-tax basis.

 

Employment Agreements

 

Michael J. Lovett

 

On February 1, 2010, Charter executed an amended and restated employment agreement with Mr. Lovett (as amended, the “Lovett Agreement”). Under the Lovett Agreement, Mr. Lovett is to serve as Charter’s President and Chief Executive Officer for a term expiring on January 31, 2013 and to receive a $1,300,000 base salary per year during the term, to be reviewed on an annual basis. Mr. Lovett is eligible to receive an annual cash performance-based bonus equal to 165% of his annual base salary earned for that applicable year, as adjusted by the Compensation and Benefits Committee of Charter’s board of directors.

 

Each annual equity award during the term of the Lovett Agreement is to have the aggregate fair value on the grant date of $4,500,000 and for the year 2010, the annual equity award shall include a stock option grant to

purchase at least 215,000 shares of common stock. He is eligible to participate in other employee benefit plans, programs and arrangements generally available to other senior executives and is eligible for other or additional long-term incentives in the sole discretion of the Compensation and Benefits Committee and/or the board of directors, including stock option grants and restricted stock awards. The Lovett Agreement contains a two-year non-compete provision and a two year non-solicitation clause.

 

Neil Smit

 

On January 21, 2010, we announced that Mr. Smit that would resign as President, Chief Executive Officer and member of Charter’s board of directors, effective February 28, 2010. Details regarding his separation and severance follow in the section titled “Separation and Related Arrangements.”

 

Christopher L. Winfrey

 

Effective November 1, 2010, Charter and Mr. Winfrey entered into an employment agreement (the “Winfrey Agreement”). The Winfrey Agreement provides that Mr. Winfrey shall be employed in an executive capacity as Executive Vice President and Chief Financial Officer with such responsibilities, duties and authority as are customary for such role, including, but not limited to, overall management responsibility for Charter’s financial and accounting functions, at a base salary of $525,000 per year during the term, to be reviewed on an annual basis. He is eligible to participate in the incentive bonus plan with a target bonus of up to 75% of his annual base salary. He is also eligible to receive such other employee benefits as are generally made available to other senior executives. The Winfrey Agreement contains a two-year non-compete provision and a two year non-solicitation clause.

 

Kevin D. Howard

 

On March 1, 2010, Charter and Mr. Howard entered into an amended and restated employment agreement (the “Howard Agreement”). The Howard Agreement provides that Mr. Howard shall be employed in an executive capacity as Senior Vice President — Finance, Controller and Chief Accounting Officer with such responsibilities, duties and authority as are customary for such role, including, but not limited to, overall management responsibility for Charter’s financial reporting and accounting, at a current base salary of $305,000 per year during the term, to be reviewed on an annual basis. He is eligible to participate in the incentive bonus plan with a target bonus of up to 65% of his annual base salary. He is also eligible to receive such other employee benefits as are generally made available to other senior executives. The Howard Agreement contains a two-year non-compete provision and a two year non-solicitation clause. During the period of August 1, 2010 through October 31, 2010 when Mr. Howard served as Interim Chief Financial Officer, Mr. Howard’s base annual salary increased to $449,000 and his target bonus increased to 75% of his annual base salary.

 

Eloise E. Schmitz

 

On April 12, 2010, we announced that Eloise E. Schmitz, former Executive Vice President and Chief Financial Officer, would leave the Company upon the expiration of the term of her employment agreement on July 31, 2010. Details regarding her separation and severance follow in the section titled “Separation and Related Arrangements.”

 

Marwan Fawaz

 

On March 15, 2011, we announced Mr. Fawaz’s separation from the Company, effective March 25, 2011. Details regarding his separation follow in the section titled “Separation and Related Arrangements.”

 

On February 23, 2010, Charter executed an amended and restated employment agreement with Mr. Fawaz that was subsequently amended by Amendment No. 1 to the Amended and Restated Employment Agreement (as amended, the “2010 Fawaz Agreement”). The 2010 Fawaz Agreement provided that Mr. Fawaz be employed in an executive capacity as Executive Vice President, Operations and Chief Technology Officer and provided for a grant of 12,410 restricted shares of Class A common stock. On January 3, 2011, Charter executed an amended and restated employment agreement with Mr. Fawaz (the “Fawaz Agreement”). The Fawaz Agreement provides that Mr. Fawaz shall be employed in an executive capacity as Executive Vice President, Strategy and Chief Technology Officer with such responsibilities, duties and authority as are customary for such role, including, but not limited to,

overall management responsibility for the development of the Company’s products and services and the engineering and technological operations for the Company’s systems, products and services. The Fawaz Agreement provides that Mr. Fawaz shall be employed at a base salary of $650,000 through May 2, 2011 when Mr. Fawaz shall begin to receive an annual base salary of $550,000 per year, to be reviewed on an annual basis. Mr. Fawaz is eligible to participate in the incentive bonus plan with a target bonus of up to 125% of his annual base salary for the period from the date of the 2010 Fawaz Agreement through May 2, 2011 and thereafter up to 75% of his annual base salary. Mr. Fawaz is also eligible to receive such other employee benefits as are available to other senior executives. The Fawaz Agreement contains a two-year non-compete provision and a two year non-solicitation clause.

 

Ted W. Schremp

 

On February 14, 2011, we announced Mr. Schremp’s resignation as Executive Vice President, Operations and Marketing. Details regarding his separation follow in the section titled “Separation and Related Arrangements.”

 

On February 23, 2010, Charter executed an amended and restated employment agreement with Mr. Schremp (the “2010 Schremp Agreement”). The 2010 Schremp Agreement provided that Mr. Schremp be employed in an executive capacity as Executive Vice President and Chief Marketing Officer and provided for a grant of 9,690 restricted shares of Class A common stock. On January 3, 2011, Charter executed an amended and restated employment agreement with Mr. Schremp (the “Schremp Agreement”). The Schremp Agreement provided that Mr. Schremp would be employed in an executive capacity as Executive Vice President, Operations and Marketing with such responsibilities, duties and authority as are customary for such role, including, but not limited to, overall management responsibility for the marketing of the Company’s products and services and the customer service operations for the Company’s products and services. The Schremp Agreement provided that Mr. Schremp would be employed at a base salary of $550,000 per year beginning December 19, 2010, to be reviewed on an annual basis. Mr. Schremp was eligible to participate in the incentive bonus plan with a target bonus of up to 75% of his annual base salary. He was also eligible to receive such other employee benefits as were available to other senior executives. The Schremp Agreement contained a two-year non-compete provision and a two year non-solicitation clause.

 

Gregory L. Doody

 

On July 27, 2010, Charter and Mr. Doody entered into an employment agreement (the “2010 Doody Agreement”). The 2010 Doody Agreement provided that Mr. Doody be employed in an executive capacity as Executive Vice President and General Counsel. On January 3, 2011, Charter executed an amended and restated employment agreement with Mr. Doody (the “Doody Agreement”). The Doody Agreement provides that Mr. Doody shall be employed in an executive capacity as Executive Vice President, Programming and Legal Affairs with such responsibilities, duties and authority as are customary for such role, including, but not limited to, overall management responsibility for government relations of the Company and the programming arrangements for the Company’s products and services. The Doody provides that Mr. Doody shall be employed at a base salary of $550,000 per year beginning December 19, 2010, to be reviewed on an annual basis. Mr. Doody is eligible to participate in the incentive bonus plan with a target bonus of up to 75% of his annual base salary. He is also eligible to receive such other employee benefits as are generally made available to other senior executives. The Doody Agreement contains a two-year non-compete provision and a two year non-solicitation clause.

 

Separation and Related Arrangements

 

The following tables show payments due to each of the Named Executive Officers upon termination of employment, assuming that the triggering of payments had occurred on December 31, 2010. As noted previously, many of our Named Executive Officers entered into new employment agreements at the beginning of 2011. Severance terms and conditions may differ from what is presented under the following section as a result such current employment agreements. The stock price used in these calculations is $38.94 per share, the closing price of Charter Class A common stock on the NASDAQ Global Select Market on December 31, 2010. The paragraphs that follow each table describe the termination provisions that are contained in each named executive officer’s

employment agreement. These descriptions cover only information regarding benefits that are not generally available to other employees. Benefits generally available to other employees are:

 

 

President, Chief Executive Officer and member of Charter’s Board (Michael J. Lovett)

 

 

 

 

Death or Disability Termination Event

 

In the event that Mr. Lovett is terminated as a result of death or “disability,” Mr. Lovett, his estate or beneficiaries shall be entitled to receive:

 

 

Without Cause/Good Reason Termination Event

 

In the event that Mr. Lovett is terminated by Charter without “cause” or, upon his election, for “good reason,” Mr. Lovett will receive:

 

 

Change in Control Termination Event

 

In the event that within 30 days before, or 13 months following, the occurrence of a Change in Control, Charter or any of its subsidiaries, terminate his employment without “cause” or he terminates his employment with Charter and its subsidiaries for “good reason,” Mr. Lovett will receive:

 

 

Neil Smit (former Chief Executive Officer, President and member of Charter’s board)

 

On January 21, 2010, we announced that Mr. Smit that would resign as President, Chief Executive Officer and member of Charter’s board of directors, effective February 28, 2010. In connection with his separation from Charter, Mr. Smit did not receive any severance beyond the benefits generally available to other departing members of senior management. Further, he forfeited any unvested equity held at the date of his departure and all payments under the CIP portion of the VCP. He received a payout of $278,014 from the performance cash program.

Executive Vice President and Chief Financial Officer (Christopher L. Winfrey)

 

 

 

 

Death or Disability Termination Event

 

In the event that Mr. Winfrey is terminated as a result of death or “disability,” Mr. Winfrey, his estate or beneficiaries shall be entitled to receive:

 

 

Without Cause/Good Reason Termination Event

 

In the event that Mr. Winfrey is terminated by Charter without “cause” or, upon his election, for “good reason,” Mr. Winfrey will receive:

 

 

Change in Control Termination Event

 

In the event that within 30 days before, or 13 months following, the occurrence of a Change in Control, Charter or any of its subsidiaries, terminate his employment without “cause” or he terminates his employment with Charter and its subsidiaries for “good reason,” Mr. Winfrey will receive:

 

 

Senior Vice President — Finance, Controller and Chief Accounting Officer (former Interim Chief Financial Officer) (Kevin D. Howard)