Exhibit 10.21

 

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210 E. Earll Drive

Phoenix, AZ 85012

Ph: 602-364-6000

Fax: 602-364-6013

 

 

 

 

November 17, 2017

Alan H. Silverman

VIA HAND DELIVERY

 

 

Dear Alan:

 

This letter agreement (this “Agreement”) will confirm our discussions and the
understandings we have reached regarding your retirement from Cable One, Inc.
(the “Company”) effective December 29, 2017 and related matters. Reference is
made to the Restricted Stock Award Agreements, by and between you and the
Company, dated July 8, 2015 (the “2015 Staking Grants Agreement”), dated January
4, 2016 (the “2016 Annual Grants Agreement”), dated January 3, 2017 (the “2017
Annual Grants Agreement”), and dated January 3, 2017 (the “2017 Time Based
Grants Agreement,” and together with the 2015 Staking Grants Agreement, the 2016
Annual Grants Agreement, and the 2017 Annual Grants Agreement, the “RSA
Agreements”), and the SARs Award Agreement, between you and the Company, dated
September 1, 2015 (the “SARs Agreement”, and together with the RSA Agreements,
the “Award Agreements”). Capitalized terms used in this Agreement and not
otherwise defined herein shall have the respective meanings given to such terms
in the applicable Award Agreements.

 

On December 29, 2017 (the “Termination Date”), you will cease to be an employee
of the Company. Following that date, you will receive a check from the Company
which represents payment of your unpaid salary, less any amounts you may owe the
Company and less appropriate statutory deductions, it being agreed that you will
have no accrued but unused vacation or other paid time off as of the Termination
Date . You should submit to me for review not later than January 12, 2018 any
expense reports for unreimbursed business expenses (together with appropriate
documentation, etc.) incurred prior to the Termination Date.

 

The Company agrees that it will treat your termination of employment with the
Company as without “Cause” in accordance with the Award Agreements. As a result,
your unvested SARs and Restricted Stock will be treated as follows:

 

 

1.

SARs. You will vest in a portion of the SARs granted to you pursuant to the SARs
Agreement determined by multiplying the total number of SARs granted to you by
the Pro-Ration Fraction and then subtracting the number of SARs that had vested
in accordance with their terms prior to the Termination Date (“Vested SARs”). In
accordance with Section 4 of the SARs Agreement, your Vested SARs and any other
unexercised SARs that have vested in accordance with their terms prior to the
Termination Date may be exercised within three months following the Termination
Date. Upon your delivery to the Company of a written exercise notice within such
three-month exercise period, the Company shall deliver to you or your legal
representative the number of Shares (rounded down to the nearest whole Share)
equal to the excess, if any, of the Fair Market Value per Share on the
Termination Date over the Exercise Price, multiplied by the number of Vested
SARs, subject to your satisfaction of any applicable withholding taxes. All SARs
other than the Vested SARs and any other SARs that have vested in accordance
with their terms prior to the Termination Date will be cancelled in exchange for
the SARs Consideration (as defined below).

 

 

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2.

Restricted Stock. You will vest in a portion of your Restricted Shares that were
granted to you pursuant to the 2015 Staking Grants Agreement and the 2016 Annual
Grants Agreement, determined by multiplying the total number of Restricted
Shares outstanding prior to the Termination Date by the applicable Pro-Ration
Fraction (“Vested Restricted Shares”), subject to your satisfaction of any
applicable withholding taxes. All Restricted Shares granted to you pursuant to
the 2015 Staking Grants Agreement and the 2016 Annual Grants Agreement that are
not Vested Restricted Shares will be cancelled in exchange for the RSA
Consideration (as defined below). You will forfeit without consideration all
outstanding Restricted Shares granted to you in the 2017 Annual Grants Agreement
and the 2017 Time Based Grants Agreement, since the Termination Date will occur
before the first anniversary of the Grant Date. In accordance with Section 6 of
the applicable RSA Agreement, you also shall vest and receive payment pursuant
to this Agreement (and without duplication of any amounts due under any RSA
Agreement) of all dividends accrued with respect to the Vested Restricted Shares
for record dates prior to the Termination Date (the “Accrued Dividend Amount”).

 

 

3.

All payments and benefits provided by the Company to you under this Agreement
are in full satisfaction of all your rights under the Award Agreements and you
shall not be entitled to any additional payment or benefits pursuant to the
Award Agreements other than as set forth in this Agreement.

 

 

4.

Your obligations under Appendix A of the Award Agreements (attached hereto as
Annex B) shall remain in full force and effect for the entire period provided
therein, and the provisions of Sections 11, 15 and 16 of the Award Agreements
shall survive indefinitely.

 

 

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If you decide to use the services of an outplacement firm within three (3)
months from the date of the Termination Date for purposes of your securing a new
job, the Company will reimburse you for up to $5,000.00 in charges by such firm,
upon receipt of appropriate documentation.

 

Your participation under all Company employee benefit plans will be in
accordance with their terms, except to the extent set forth in this Agreement
and attachments hereto. Any money in the benefit plans of the Company due to you
will be distributed in accordance with standard Company policy and applicable
federal and state statutes. You will be provided the Cancellation of Benefits
Form concerning any options which may be available to you under the various
benefit plans.

 

At no time shall you say or do anything to disparage the Company or take any
actions detrimental to the best interests of the Company or any of its
employees, including but not limited to, disclosure to third parties or any
other use of information confidential to the Company. You also acknowledge your
ongoing obligations under: (a) the Company Code of Business Conduct, including
but not limited to your obligation not to use or disclose for your own advantage
or profit, or the advantage or profit of any other person or entity, any
confidential information as defined therein, and (b) Appendix A of the Award
Agreements, including but not limited to restrictive covenants related to
competition, solicitation, disparagement and confidential information.

 

The Company agrees to instruct its officers and human resource personnel to
refrain from making any statement to any person outside of the Company that is
critical or derogatory of you and/or your work performance or professional
competency while you were employed at the Company. You should direct any
reference inquiries to the Company Vice President of Human Resources or the
President/CEO, and the Company agrees that, in response to inquiries for
employment references, it shall provide a “neutral reference” consisting of your
dates of employment and positions held and that you retired after 34 years of
service. These restrictions do not prohibit either of us from providing truthful
responses compelled by legal process or otherwise sought in any future legal,
administrative or government investigative proceedings.

 

You shall return to the Company not later than the Termination Date any Company
property (including, but not limited to, Company vehicle, computer equipment,
cellphone, software, other Company property or equipment, credit cards, and
keys) and permanently delete from any home computer or other electronic storage
medium originals and any copies of any information or documents confidential or
proprietary to the Company in your possession (including, but not limited to,
any financial, tax, strategic or marketing documents created by or for the
Company). Notwithstanding the foregoing sentence, upon removal by the Company of
all documents confidential or proprietary to the Company from your
Company-issued computer, you shall be entitled to retain ownership of such
device for your personal use. In addition, you shall not apply for, seek, or
accept (and, if hired, will immediately resign from) any position with the
Company or any of its current or future divisions, subsidiaries or affiliates as
an employee, except to the extent explicitly agreed to in advance by an
authorized representative of the Company.

 

 

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Subject to the terms of the Release (as defined below) and to the extent
permitted by applicable law and regulations, you agree that you will not
voluntarily participate in any investigation, suit or proceedings by any other
individual against the Company. Subject to the terms of any consulting agreement
entered into by and between you and the Company, you further agree to cooperate
with and assist the Company in the defense of any claim or proceeding brought
against it or any of its related persons or entities arising out of any aspect
of the performance of your job while employed. This cooperation and assistance
shall include, but not be limited to, making yourself available at reasonable
times to respond to requests for information from the Company’s management and
its attorneys and attendance at any legal or administrative proceedings where
the Company determines (in its sole discretion) that your attendance is
necessary. The Company shall use its reasonable best efforts to provide you with
at least 48 hours prior notice of any such requests for attendance.

 

Nothing in this Agreement shall be deemed or construed as an admission by the
Company of the validity of any claim or allegation you may have in connection
with your employment with the Company or the termination of that employment and
the Company specifically disclaims any liability to, or discrimination against
you or any other person, on the part of itself, its employees, directors,
officers or agents.

 

Furthermore, in exchange for your: (a) acknowledgement of and continued
compliance with the restrictive covenants set forth in Appendix A of the Award
Agreements; (b) compliance with the other terms and conditions of this
Agreement; and (c) execution of and compliance with a general release of claims
in the form annexed hereto as Annex A (the "Release"), you will receive, as set
forth below, a series of two payments (collectively, the “Separation
Consideration”), which in aggregate consists solely of:

 

(i) $615,000.00, reflecting payment of twelve months of your annual base salary
as of the Termination Date plus an additional $300,000.00;

 

(ii) $60,000.00 reflecting approximately twenty-four (24) months of premiums for
medical and dental coverage pursuant to COBRA;

 

(iii) $35,511.00, reflecting payment of the Accrued Dividend Amount; and

 

(iv) in accordance with Annex C (which provides, solely for illustrative
purposes, a hypothetical FMV (as defined below) of the Company’s common stock of
$740.00 per share):

 

 

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(Y) the product of (a) closing per-Share price of the Company’s common stock as
listed on the New York Stock Exchange or another national stock exchange or
quotation system on the Termination Date (the “FMV”) and (b) 254 (such product,
the “RSA Consideration”); and

 

(Z) the product of (a) the FMV minus the SARs Exercise Price and (b) 4,719 (such
product, the “SARs Consideration”); provided, that if the SARs Consideration is
a negative number, the SARs Consideration shall be deemed to be zero.

 

The Separation Consideration will be paid in one installment, which shall be
paid on January 12, 2018; provided, that such payment shall only be paid if the
Release has become effective and irrevocable. For the avoidance of doubt, if any
portion of the Release has been validly revoked, you shall not be entitled to
any of the Separation Consideration.

 

The arrangements provided for in this Agreement include all payments to which
you might otherwise be entitled as a result of your employment with and/or
separation from the Company (including, but not limited to, salary, vacation,
flex days, commissions, severance, notice, stock or equity awards, or bonus pay
and the other understandings in this Agreement). For the avoidance of doubt, you
agree that (i) you are only entitled to the Separation Consideration upon the
effectiveness of the Release and (ii) you are not entitled to (A) any bonus or
similar payment in connection with your employment with the Company during
calendar year 2017 or (B) any further payments in connection with your
employment, including with respect to vacation, flex days, or any similar paid
time off program administered or maintained by the Company.

 

All payments provided to you under this Agreement, including without limitation
the Separation Consideration, shall be subject to appropriate tax and other
withholdings and deductions and reported on IRS Forms W-2, 1099, or otherwise,
as determined by the Company in its sole discretion. You acknowledge that you
have not relied on any statements or representations by the Company with respect
to the tax treatment of the payments described in this Agreement and that you
are solely responsible for payment of all taxes required to be paid in
connection with the Separation Consideration. If any taxing body determines that
the tax treatment of any such payment was incorrect and that greater amounts
should have been withheld from such payment, you acknowledge and assume all
responsibility for paying those amounts and further agree to indemnify and hold
the Company harmless for payment of any additional taxes and any interest and
penalties thereon.

 

This Agreement and its attachments and other incorporated documents contain the
entire agreement between you and the Company concerning your employment with the
Company and your separation therefrom. Any and all prior agreements,
representations, negotiations and understandings between the parties, oral or
written, express or implied, relating to the subject matter herein, are hereby
superseded.

 

 

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This Agreement may be amended, changed or modified only by a written document
signed by all parties hereto. No waiver of this Agreement or of any of the
promises, obligations, terms or conditions hereof shall be valid unless it is
written and signed by the party against whom the waiver is to be enforced.

 

This Agreement and all matters or issues collateral thereto shall be governed by
the laws of the State of Delaware applicable to contracts entered into and
performed entirely therein, without regard to principles of conflict of laws
that could cause the application of the law of any jurisdiction other than the
State of Delaware. Section 11 of the Award Agreements is hereby incorporated by
reference.

 

To the extent permitted by law, the Company expressly reserves all rights and
remedies available to it, including, without limitation, the right to recover
all costs and expenses (including legal fees) that the Company is forced to
incur because of your failure to honor your obligations under this Agreement.

 

It is intended that the provisions of this Agreement comply with Section 409A of
the Internal Revenue Code of 1986, as amended (the “Code”), and all provisions
of this Agreement shall be construed and interpreted in a manner consistent with
the requirements for avoiding taxes or penalties under Section 409A of the Code.
Except as specifically permitted by Section 409A of the Code, the benefits and
reimbursements provided to you under this Agreement during any calendar year
shall not affect any benefits and reimbursements to be provided to you under
this Agreement in any other calendar year, and the right to such benefits and
reimbursements cannot be liquidated or exchanged for any other benefit and shall
be provided in accordance with Treas. Reg. Section 1.409A-3(i)(1)(iv) or any
successor thereto. Furthermore, reimbursement payments shall be made to you as
soon as practicable following the date that the applicable expense is incurred,
but in no event later than the last day of the calendar year following the
calendar year in which the underlying expense is incurred. For purposes of
Section 409A of the Code, each payment hereunder will be deemed to be a separate
payment under Treasury Regulation Section 1.409A-2(b)(2)(iii). It is intended
that your termination of employment on the Termination Date will constitute a
"separation from service" within the meaning of Section 409A of the Code.

 

You shall keep confidential the terms and fact of this Agreement and the
circumstances surrounding your separation from the Company and not disclose them
to anyone, other than your immediate family and professional advisors so long as
such disclosure is accompanied by a direction that the recipient must keep the
information confidential, without the Company’s prior written permission.

 

You acknowledge that you: (a) fully understand the terms of this Agreement; (b)
have been advised by the Company to consult with counsel and have had a full and
fair opportunity to review this Agreement with counsel of your choosing; (c) are
entering into this Agreement knowingly and voluntarily and in return for
consideration you otherwise would not be entitled to receive.

 

 

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The provisions of this Agreement are severable. If a court of competent
jurisdiction rules that any provision of this Agreement is invalid or
unenforceable, that provision shall be automatically modified to the extent
necessary to make it valid and such a ruling shall not affect the validity or
enforceability of any other provision of this Agreement. Further, if a court
should determine that any portion of this Agreement is overbroad or
unreasonable, such provision shall be given effect to the maximum extent
possible by narrowing or enforcing in part that aspect of the provision found
overbroad or unreasonable.

 

This Agreement may be executed in multiple counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument. Signatures obtained via facsimile or in .pdf format shall be deemed
valid as if they were inked originals.

 

If this Agreement correctly sets forth our agreement, please sign and return the
enclosed copy of this Agreement to me. The original is for your records.

 

 

We wish you the best of luck in your future endeavors.

 

 

 

Sincerely,

 

/s/ Julia M. Laulis

 

Julia Laulis

President & CEO

 

 

 

IN WITNESS WHEREOF, you have acknowledged your agreement with and acceptance of
these terms and duly executed this Agreement.

 

 

Accepted and agreed:

 

/s/ Alan H. Silverman

    ALAN H. SILVERMAN

 

 

Date: November 17, 2017