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                                                                   Exhibit 10.19

         AMENDED AND RESTATED EMPLOYMENT AGREEMENT made as of March 18, 1998,
effective as of January 1, 1998 (the "Effective Date"), as amended December 2,
1998, between TIME WARNER INC., a Delaware corporation (the "Company"), and John
A. LaBarca (the "Executive").

         The Executive is currently employed by the Company pursuant to an
Employment Agreement made as of July 14, 1997 (the "Prior Agreement"). The
Company wishes to restate the Prior Agreement and secure the services of the
Executive on a full-time basis for the period to and including April 30, 2002
and thereafter for a one-year advisory period on and subject to the terms and
conditions set forth in this Agreement, and the Executive is willing for the
Prior Agreement to be so restated and to provide such services on and subject to
the terms and conditions set forth in this Agreement. The parties therefore
agree as follows:

         1. Term of Employment. The Executive's "term of employment", as this
phrase is used throughout this Agreement, shall be for the period beginning on
the Effective Date and ending on April 30, 2002, subject, however, to the terms
and conditions set forth in this Agreement. Notwithstanding the foregoing or
anything to the contrary contained in this Agreement, the "term of employment"
as used in Section 3.6, 3.7, 3.8 and 8 through 12 shall mean the period ending
at the end of the Advisory Period (as defined in Section 13).

         2. Employment. The Company shall employ the Executive, and the
Executive shall serve, as Senior Vice President, Financial Operations and
Controller of the Company during the term of employment, and the Executive shall
have the authority, functions, duties, powers and responsibilities normally
associated with such position and as the Board of Directors, the Chief Executive
Officer, the President or the Chief Financial Officer of the Company may from
time to time delegate to the Executive in addition thereto. The Executive shall,
subject to his election as such from time to time and without additional
compensation, serve during the term of employment in such additional offices of
comparable or greater stature and responsibility in the Company and its
subsidiaries and as a director and as a member of any committee of the Board of
Directors of the Company and its subsidiaries, to which he may be elected from
time to time. During the term of employment, (i) the Executive's services shall
be rendered on a substantially full-time, exclusive basis and he will apply on a
full-time basis all of his skill and experience to the performance of his duties
in such employment, (ii) the Executive shall report only to the Chief Financial
Officer of the Company, (iii) the Executive shall have no other employment and,
without the prior written consent of the Chief Executive Officer, the President
or the Chief Financial Officer of the Company, no outside business activities
which require the devotion of substantial amounts of
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the Executive's time and (iv) the place for the performance of the Executive's
services shall be the principal executive offices of the Company which shall be
in the New York City metropolitan area, subject to such reasonable travel as may
be appropriate or required in the performance of the Executive's duties in the
business of the Company. The foregoing shall be subject to the Company's written
policies, as in effect from time to time, regarding vacations, holidays, illness
and the like and shall not prevent the Executive from devoting such time to his
personal affairs as shall not interfere with the performance of his duties
hereunder, provided that the Executive complies with the provisions of Sections
9 and 10 and any of the Company's written policies on conflicts of interest and
service as a director of another corporation, partnership, trust or other entity
("Entity").

         3. Compensation

            3.1. Base Salary. The Company shall pay or cause to be paid to the
Executive a base salary of not less than $325,000 per annum during the term of
employment (the "Base Salary"). The Company may increase, but not decrease, the
Base Salary at any time and from time to time during the term of employment and
upon each such increase the term "Base Salary" shall mean such increased
amount. Base Salary shall be payable in monthly or more frequent installments in
accordance with the Company's then current practices and policies with respect
to senior executives. For the purposes of this Agreement "senior executives"
shall mean executives of the Company at the same executive level as the
Executive,

            3.2. Bonus. In addition to Base Salary, the Executive may be
entitled to receive during the term of employment an annual cash bonus based on
the performance of the Company and of the Executive. Bonuses for senior
executives may be determined by the Compensation Committee of the Company's
Board of Directors or by the Chief Executive Officer or the Chief Financial
Officer of the Company. Such determination with respect to the amount, if any,
of annual bonuses to be paid to the Executive under this Agreement shall be
final and conclusive except as specifically provided otherwise in this
Agreement. Payments of any bonus compensation under this Section 3.2 shall be
made in accordance with the Company's then current practices and policies with
respect to senior executives, but in no event later than 90 days after the end
of the period for which the bonus is payable.

            3.3 Deferred Compensation. In addition to Base Salary and bonus as
set forth in Sections 3.1 and 3.2, the Executive shall be credited with a
defined contribution which shall be determined and paid out on a deferred basis
("deferred compensation") as provided in this Agreement, including Annex A
hereto. Unless the Executive shall make the election described in the last
sentence of this Section 3.3, during the term of employment, the Company shall
pay to the trustee (the "Trustee") of a Company grantor trust (the "Rabbi
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Trust") for credit to a special account maintained on the books of the Rabbi
Trust for the Executive (the "Trust Account"), monthly, an amount equal to 50%
of one-twelfth of the Executive's then current Base Salary. If a lump sum
payment is made pursuant to Section 4.2.2 or 4.2.3, the Company shall pay to the
Trustee for credit to the Trust Account at the time of such payment an amount
equal to 50% of the Base Salary portion of such lump sum payment; provided,
however, that the Executive may elect by written notice to the Company no later
than the date the Executive makes the election provided for in the first
paragraph of Section 4.2 to have such amount credited instead to the Deferred
Compensation Plan established by the Company on November 18, 1998, as the same
may be amended from time to time (as so amended, the "Deferred Plan"). The Trust
Account shall be maintained by the Trustee in accordance with the terms of this
Agreement, including Annex A, and the trust agreement (the "Trust Agreement")
establishing the Rabbi Trust (which Trust Agreement shall in all respects be in
furtherance of, and not inconsistent with, the terms of this Agreement,
including Annex A), until the full amount which the Executive is entitled to
receive therefrom has been paid in full. Effective April 1, 1998, the Company
shall establish and maintain the Rabbi Trust as a grantor trust within the
meaning of subpart E, part I, subchapter J, chapter 1, subtitle A of the Code
and shall pay all fees and expenses of the Trustee and shall enforce the
provisions of the Trust Agreement for the benefit of the Executive. Prior to
April 1, 1998, the Company shall credit the Executive with deferred compensation
in accordance with the provisions of Section 3.3 of the Prior Agreement. The
Executive may elect by written notice delivered to the Company at least 15 days
prior to the commencement of any calendar year during the term of employment
(except that for calendar year 1999, such election shall be made no later than
January 31, 1999) to have (a) all of the payments to be made to the Rabbi Trust
pursuant to the second sentence of this Section 3.3 to be credited instead to
the Deferred Plan or (b) to have 50% of the payments to be made by the Company
pursuant to the second sentence of this Section 3.3 to be credited instead to
the Deferred Plan and the remaining 50% to be paid to the Rabbi Trust.

            3.4 Deferred Bonus. In addition to any other deferred bonus plan in
which the Executive may be entitled to participate, the Executive may elect by
written notice delivered to the Company at least 15 days prior to the
commencement of any calendar year during the term of employment during which an
annual cash bonus would otherwise accrue or to which it would relate (except
that for calendar year 1999, such election shall be made no later than January
31, 1999), to defer payment of and to have the Company credit all or any portion
of the Executive's bonus for such year to either the Trust Account or the
Deferred Plan, or a combination of both, subject in the case of a deferral to
the Deferred Plan to the terms and conditions of the Deferred Plan. Any such
election shall only apply to the calendar year during the term of employment
with respect to which such election is made and a new election shall be required
with respect to each successive calendar year during the term of employment.
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            3.5. Prior Account. The parties confirm that the Company has
maintained a deferred compensation account (the "Prior Account") for the
Executive in accordance with the Prior Agreement. The Prior Account shall be
promptly transferred to, and shall for all purposes be deemed part of, the Trust
Account and shall be maintained by the Trustee in accordance with this Agreement
and the Trust Agreement. All prior credits to the Prior Account shall be deemed
to be credits made under this Agreement, all "Account Retained Income"
thereunder shall be deemed to be Account Retained Income under this Agreement
and all increases or decreases to the Prior Account as a result of income,
gains, losses and other changes shall be deemed to have been made under this
Agreement.

            3.6. Reimbursement. The Company shall reasonably promptly pay or
reimburse the Executive for all reasonable travel, entertainment and other
business expenses actually incurred or paid by the Executive during the term of
employment in the performance of his services under this Agreement provided such
expenses are incurred or paid in accordance with the Company's then current
written practices and policies with respect to senior executives of the Company
and upon presentation of expense statements or vouchers or such other supporting
information as the Company may customarily require of its senior executives.

            3.7. No Anticipatory Assignments. Except as specifically
contemplated in Section 12.8 or under the life insurance policies and benefit
plans referred to in Sections 7 and 8, respectively, neither the Executive, his
legal representative nor any beneficiary designated by him shall have any right,
without the prior written consent of the Company, to assign, transfer, pledge,
hypothecate, anticipate or commute to any person or Entity any payment due in
the future pursuant to any provision of this Agreement, and any attempt to do so
shall be void and shall not be recognized by the Company.

            3.8. Indemnification. The Executive shall be entitled throughout the
term of employment in his capacity as an officer or director of the Company or
any of its subsidiaries or an officer or member of the Board of Representatives
or other governing body of any partnership or joint venture in which the Company
has an equity interest (and after the term of employment, to the extent relating
to his service as such officer, director or member) to the benefit of the
indemnification provisions contained on the date hereof in the Certificate of
Incorporation and By-Laws of the Company (not including any amendments or
additions after the date of execution hereof that limit or narrow, but including
any that add to or broaden, the protection afforded to the Executive by those
provisions), to the extent not prohibited by applicable law at the time of the
assertion of any liability against the Executive.
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         4. Termination.

              4.1. Termination for Cause. The Company may terminate the term of
employment and all of the Company's obligations under this Agreement, other than
its obligations set forth below in this Section 4.1, for "cause" but only if the
term of employment has not previously been terminated pursuant to any other
provision of this Agreement. Termination by the Company for "cause" shall mean
termination by action of the Company's Board of Directors, or a committee
thereof, because of the Executive's conviction (treating a nolo contendere plea
as a conviction) of a felony (whether or not any right to appeal has been or may
be exercised) or willful refusal without proper cause to perform his obligations
under this Agreement or because of the Executive's breach of any of the
covenants provided for in Section 9. Such termination shall be effected by
written notice thereof delivered by the Company to the Executive and shall be
effective as of the date of such notice, provided, however, that if (i) such
termination is because of the Executive's willful refusal without proper cause
to perform any one or more of his obligations under this Agreement, (ii) such
notice is the first such notice of termination for any reason delivered by the
Company to the Executive under this Section 4.1, and (iii) within 15 days
following the date of such notice the Executive shall cease his refusal and
shall use his best efforts to perform such obligations, the termination shall
not be effective.

              In the event of such termination by the Company for cause, without
prejudice to any other rights or remedies that the Company may have at law or in
equity, the Company shall have no further obligations to the Executive other
than (i) to pay Base Salary and make credits of deferred compensation as
provided in Sections 3.1 and 3.3 accrued through the effective date of
termination, (ii) to pay any annual bonus pursuant to Section 3.2 to the
Executive in respect of the calendar year prior to the calendar year in which
such termination is effective, in the event such annual bonus has been
determined but not yet paid as of the date of such termination and (iii) with
respect to any rights the Executive has in respect of amounts credited to the
Trust Account or pursuant to any insurance or other benefit plans or
arrangements of the Company maintained for the benefit of its senior executives.
The Executive hereby disclaims any right to receive a pro rata portion of the
Executive's annual bonus with respect to the year in which such termination
occurs. The fourth sentence of Section 3.3 and the provisions of Sections 3.8,
8.2, 8.3 and 9 through 12 and Annex A shall survive any termination pursuant to
this Section 4.1.

              4.2. Termination by Executive for Material Breach by the Company 
and Termination by the Company Without Cause. Unless previously terminated
pursuant to any other provision of this Agreement and unless a Disability Date
has occurred and the disability period remains in effect, the Executive shall
have the right, exercisable by written notice to the Company, to terminate the
term of employment effective 15 days after the giving
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of such notice, if, at the time of the giving of such notice, the Company shall
be in material breach of its obligations under this Agreement; provided,
however, that, with the exception of clause (i) below, this Agreement shall not
so terminate if such notice is the first such notice of termination delivered by
the Executive pursuant to this Section 4.2 and within such 15-day period the
Company shall have cured all such material breaches of its obligations under
this Agreement. A material breach by the Company shall include, but not be
limited to, (i) the Company failing to cause the Executive to retain the title
specified in the first sentence of Section 2 or a more senior title; (ii) the
Executive being required to report to persons other than those specified in
Section 2; (iii) the Company violating the provisions of Section 2 with respect
to the Executive's authority, functions, duties, powers or responsibilities
(whether or not accompanied by a change in title); (iv) the Company requiring
the Executive's primary services to be rendered at a place other than at the
Company's principal executive offices in the New York City metropolitan area;
and (v) the Company failing to cause the successor to all or substantially all
of the business and assets of the Company expressly to assume the obligations of
the Company under this Agreement.

            The Company shall have the right, exercisable by written notice to
the Executive, to terminate the Executive's employment under this Agreement
without cause, effective at least 30 days after the giving of such notice, which
notice shall specify the effective date of such termination.

            In the event of a termination pursuant to this Section 4.2, the
Executive shall be entitled to elect by delivery of written notice to the
Company, within 30 days after written notice of such termination is given
pursuant to this Section 4.2, either (A) to cease being an employee of the
Company and receive a lump sum payment as provided in Section 4.2.2 or (B) to
remain an employee of the Company as provided in Section 4.2.3. After the
Executive makes such election, the following provisions shall apply:

                           4.2.1. Regardless of the election made by the
Executive pursuant to the preceding paragraph, (i) after the effective date of
such termination, the Executive shall have no further obligations or liabilities
to the Company whatsoever, except that Sections 4.4 and 4.5 and Sections 6
through 12 shall survive such termination, and (ii) the Executive shall be
entitled to receive any earned and unpaid Base Salary and deferred compensation
accrued through the effective date of such termination and a pro rata portion of
the Executive's annual bonus for the year in which such termination occurs
through the date of such termination based on the average of the regular annual
bonus amounts (excluding the amount of any special or spot bonuses) in respect
of the two calendar years during the most recent five calendar years for which
the regular annual bonus received by the Executive from the Company was the
greatest, provided that such annual bonus shall not be less than $462,500, all
or a portion of which pro rata bonus will be credited to the Trust Account or
the
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Deferred Plan in accordance with any previous election made by the Executive to
defer all or any portion of the Executive's bonus for such year pursuant to
Section 3.4.

                  4.2.2. In the event the Executive shall make the election
provided in clause (A) above, the Company shall pay to the Executive as damages
in a lump sum within 30 days thereafter (provided that if the Executive was
named in the compensation table in the Company's then most recent proxy
statement, such lump sum payment shall be made within 30 days after the end of
the calendar year in which such notice of termination is given) an amount
(discounted as provided in the immediately following sentence) equal to all
amounts otherwise payable pursuant to Sections 3.1, 3.2, 3.3 and 13 for the year
in which such termination occurs and for each subsequent year of the term of
employment and the Advisory Period (assuming that annual bonuses are required to
be paid for each such year of the term of employment, with each such annual
bonus being equal to the average of the regular annual bonus amounts (excluding
the amount of any special or spot bonuses) in respect of the two calendar years
during the most recent five calendar years for which the regular annual bonus
received by the Executive from the Company was the greatest (assuming that no
portion of such bonus is deferred pursuant to Section 3.4), with the bonus for
any partial calendar year appropriately annualized, provided that such annual
bonus shall not be less than $462,500. Any payments required to be made to the
Executive pursuant to this Section 4.2.2 upon such termination in respect of
Sections 3.1, 3.2 and 13 and the payment provided for in the third sentence of
Section 3.3 shall be discounted to present value as of the date of payment from
the times at which such amounts would have become payable absent any such
termination at an annual discount rate for the relevant periods equal to 120% of
the "applicable Federal rate" (within the meaning of Section 1274(d) of the
Internal Revenue Code of 1986 (the "Code")), in effect on the date of such
termination, compounded semiannually, the use of which rate is hereby elected by
the parties hereto pursuant to Treas. Reg. Section 1.280G-1 Q/A 32 (provided
that, in the event such election is not permitted under Section 280G of the Code
and the regulations thereunder, such other rate determined as of such other date
as is applicable for determining present value under Section 280G of the Code
shall be used).

                  4.2.3. In the event the Executive shall make the election
provided in clause (B) above, the term of employment shall continue and the
Executive shall remain an employee of the Company until the end of the term of
employment and the Advisory Period and during such period the Executive shall be
entitled to receive, whether or not he becomes disabled during such period but
subject to Section 6, (a) Base Salary at an annual rate equal to his Base Salary
in effect immediately prior to the notice of termination for each year through
the term of employment, (b) an annual bonus (all or a portion of which may be
deferred by the Executive pursuant to Section 3.4) in respect of each calendar
year or portion thereof during the term of employment (in which case a pro rata
portion of such
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annual bonus will be payable) during such period equal to the average of the
regular annual bonus amounts (excluding the amount of any special or spot
bonuses) in respect of the two calendar years during the most recent five
calendar years for which the regular annual bonus received by the Executive from
the Company was the greatest (with any partial calendar year bonus appropriately
annualized) as provided in Section 3.2, provided that such annual bonus shall
not be less than $462,500, (c) deferred compensation as provided in Section 3.3
and (d) Advisory Period compensation as provided in Section 13. Except as
provided in the next sentence, if the Executive accepts full-time employment
with any other Entity during such period or notifies the Company in writing of
his intention to terminate his status as an employee during such period, then
the term of employment and the Advisory Period shall cease and the Executive
shall cease to be an employee of the Company effective upon the commencement of
such employment or the effective date of such termination as specified by the
Executive in such notice, whichever is applicable, and the Executive shall be
entitled to receive as damages in a lump sum within 30 days after such
commencement or such effective date (provided that if the Executive was named in
the compensation table in the Company's then most recent proxy statement, such
lump sum payment shall be made within 30 days after the end of the calendar year
in which such commencement or effective date occurred) an amount (discounted as
provided in the second sentence of Section 4.2.2 except that the "applicable
Federal rate" shall be determined as of the date the Executive shall cease to be
an employee of the Company) for the balance of the Base Salary, deferred
compensation (which shall be credited as provided in the third sentence of
Section 3.3), regular annual bonuses (assuming no deferral pursuant to Section
3.4) and Advisory Period compensation the Executive would have been entitled to
receive pursuant to this Section 4.2.3 had the Executive remained on the
Company's payroll until the end of the Advisory Period. Notwithstanding the
preceding sentence, if the Executive accepts employment with any not-for-profit
Entity, then the Executive shall be entitled to remain an employee of the
Company and receive the payments as provided in the first sentence of this
Section 4.2.3; and if the Executive accepts full-time employment with any
affiliate of the Company, then the payments provided for in this Section 4.2.3
and the term of employment and the Advisory Period shall cease and the Executive
shall not be entitled to any such lump sum payment. For purposes of this
Agreement, the term "affiliate" shall mean any Entity which, directly or
indirectly, controls, is controlled by, or is under common control with, the
Company.

                  4.3. Office Facilities. In the event the Executive shall make
the election provided in clause (B) of Section 4.2, then for the period
beginning on the day the Executive makes such election and ending one year
thereafter, the Company shall, without charge to the Executive, make available
to the Executive office space at the Executive's principal job location
immediately prior to his termination of employment, or other location reasonably
close to such location, together with secretarial services, office facilities,
services and furnishings, in each case reasonably appropriate to an employee of
the Executive's
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position and responsibilities prior to such termination of employment but taking
into account the Executive's reduced need for such office space, secretarial
services and office facilities, services and furnishings as a result of the
Executive no longer being a full-time employee.

                  4.4. Release. In partial consideration for the Company's
obligation to make the payments described in Section 4.2, the Executive shall
execute and deliver to the Company a release in substantially the form attached
hereto as Annex B, The Company shall deliver such release to the Executive
within 10 days after the written notice of termination is delivered pursuant to
Section 4.2 and the Executive shall execute and deliver such release to the
Company within 21 days after receipt thereof If the Executive shall fail to
execute and deliver such release to the Company within such 21 day period, or if
the Executive shall revoke his consent to such release as provided therein, the
Executive's term of employment shall terminate as provided in Section 4.2, but
the Executive shall receive, in lieu of the payments provided for in said
Section 4.2, a lump sum cash payment in an amount determined in accordance with
the written personnel policies of the Company relating to notice and severance
then generally applicable to employees with length of service and compensation
level of the Executive.

                  4.5. Mitigation. In the event of termination of the term of
employment pursuant to Section 4.2, the Executive shall not be required to seek
other employment in order to mitigate his damages hereunder; provided, however,
that, notwithstanding the foregoing, if them are any damages hereunder by reason
of the events of termination described above which arc "contingent on a change"
(within the meaning of Section 2800(b)(2)(A)(i) of the Code), the Executive
shall be required to mitigate such damages hereunder, including any such damages
theretofore paid, but not in excess of the extent, if any, necessary to prevent
the Company from losing any tax deductions to which it otherwise would be
entitled in connection with such damages if they were not so "contingent on a
change". In addition to any obligation under the preceding sentence, and without
duplication of any amounts required to be paid to the Company thereunder, if any
such termination occurs and the Executive, whether or not required to mitigate
his damages under the preceding sentence, thereafter obtains other employment
with any Entity other than a not-for-profit Entity, the total cash salary and
bonus received in connection with such other employment, whether paid to him or
deferred for his benefit, for services through April 30, 2003 up to an amount
equal to (x) the discounted lump sum payment received by or for the account of
the Executive with respect to Base Salary, annual bonus and deferred
compensation under Section 3 and Advisory Period compensation under Section 13
for such period, minus (y) the amount of severance the Executive would have
received in accordance with the personnel policies of the Company if the
Executive had been job eliminated, shall reduce, pro Into, any amount which the
Company would otherwise be required to pay to the Executive as a result of such
termination and to the extent amounts have theretofore been paid to him as a
result of

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such termination and, to the extent amounts have theretofore been paid to him as
a result of such termination, such cash salary and bonus shall be paid over to
the Company as received with respect to such period, but the provisions of this
sentence shall not apply to any type of equity interest, bonus unit, phantom or
restricted stock, stock option, stock appreciation right or similar benefit
received as a result of such other employment. With respect to the preceding
sentences, any payments or rights to which the Executive is entitled by reason
of a termination pursuant to Section 4.2 shall be considered as damages
hereunder. With respect to the second preceding sentence, the Executive shall in
no event be required to pay the Company with respect to any calendar year more
than the discounted amount received by him or credited to the Trust Account with
respect to Base Salary, annual bonus, deferred compensation under Section 3 and
Advisory Period compensation under Section 13 for such year. Any obligation of
the Executive to mitigate his damages pursuant to this Section 4.5 shall not be
a defense or offset to the Company's obligation to pay the Executive in full the
amounts provided in Section 4.2.2 or 4.2.3, as the case may be, at the time
provided therein or the timely and full performance of any of the Company's
other obligations under this Agreement.

                  4.6. Payments. So long as the Executive remains on the payroll
of the Company or any subsidiary of the Company, payments of salary, deferred
compensation and bonus required to be made pursuant to Section 4.2 shall be made
at the same times as such payments are made to senior executives of the Company
or such subsidiary.

            5. Disability. If during the term of employment and prior to any
termination of this Agreement under Section 4.2, the Executive shall become
physically or mentally disabled, whether totally or partially, so that he is
prevented from performing his usual duties for a period of six consecutive
months, or for shorter periods aggregating six months in any twelve-month
period, the Company shall, nevertheless, continue to pay the Executive his full
compensation and continue to make the deferred compensation credits, when
otherwise due, as provided in Section 3, through the last day of the sixth
consecutive month of disability or the date on which the shorter periods of
disability shall have equaled a total of six months in any twelve-month period
(such last day or date being referred to herein as the "Disability Date"). If
the Executive has not resumed his usual duties on or prior to the Disability
Date, the Company shall pay the Executive a pro rata bonus for the year in which
the Disability Date occurs and shall pay the Executive disability benefits for
the period ending on the Term Date (the "Disability Period"), in an annual
amount equal to 75% of (a) the Executive's Base Salary at the time the Executive
becomes disabled (and this reduced amount shall also be deemed to be the Base
Salary for purposes of determining the amounts to be credited by the Company
pursuant to Section 3.3 as further disability benefits) and (b) the average of
the regular annual bonuses (excluding the amount of any special or spot bonuses)
in respect of the two calendar years during the most recent five calendar years
for which the annual bonus received by the Executive from the Company was the
greatest (all or a portion of which may 

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be deferred by the Executive pursuant to Section 3.4). If during the Disability
Period the Executive shall fully recover from his disability, the Company shall
have the right (exercisable within 60 days after notice from the Executive of
such recovery), but not the obligation, to restore the Executive to full-time
service at full compensation. If the Company elects to restore the Executive to
full-time service, then this Agreement shall continue in full force and effect
in all respects and the Term Date and the Advisory Period shall not be extended
by virtue of the occurrence of the Disability Period. If the Company elects not
to restore the Executive to full-time service, the Executive shall be entitled
to obtain other employment, subject, however, to the following: (i) the
Executive shall be obligated to perform advisory services during any balance of
the Disability Period; and (ii) the provisions of Sections 9 and 10 shall
continue to apply to the Executive during the Disability Period. The advisory
services referred to in clause (i) of the immediately preceding sentence shall
consist of rendering advice concerning the business, affairs and management of
the Company as requested by the Chief Executive Officer or the President of the
Company but the Executive shall not be required to devote more than five days
(up to eight hours per day) each month to such services, which shall be
performed at a time and place mutually convenient to both parties. Any income
from such other employment shall not be applied to reduce the Company's
obligations under this Agreement. The Company shall be entitled to deduct from
all payments to be made to the Executive during the Disability Period pursuant
to this Section 5 an amount equal to all disability payments received by the
Executive during the Disability Period from Workmen's Compensation, Social
Security and disability insurance policies maintained by the Company; provided,
however, that for so long as, and to the extent that, proceeds paid to the
Executive from such disability insurance policies are not includible in his
income for federal income tax purposes, the Company's deduction with respect to
such payments shall be equal to the product of (i) such payments and (ii) a
fraction, the numerator of which is one and the denominator of which is one less
the maximum marginal rate of federal income taxes applicable to individuals at
the time of receipt of such payments. All payments made under this Section 5
after the Disability Date are intended to be disability payments, regardless of
the manner in which they are computed. At the end of a Disability Period or if a
Disability Date occurs during the Advisory Period, the Company shall pay to the
Executive the full amount of the Advisory Period compensation in accordance with
Section 13 without regard to the preceding two sentences. Except as otherwise
provided in this Section 5, the during the Disability Period and the Advisory
Period, the Executive shall be entitled to all of the rights and benefits
provided for in this Agreement, except that Section 4.2 shall not apply during
the Disability Period and the Advisory Period and the term of employment and the
Advisory Period shall end and the Executive shall cease to be an employee of the
Company at the end of the Advisory Period and shall not be entitled to notice
and severance or to receive or be paid for any accrued vacation time or unused
sabbatical.

<PAGE>   12
                                                                              12


            6. Death. Upon the death of the Executive during the term of
employment or the Advisory Period, this Agreement and all obligations of the
Company to make any payments under Sections 3, 4, 5 and 13 shall terminate
except that (i) the Executive's estate (or a designated beneficiary) shall be
entitled to receive, to the extent being received by the Executive immediately
prior to his death, Base Salary and deferred compensation or Advisory Period
compensation, as applicable, to the last day of the month in which his death
occurs and if the Executive dies during the term of employment, shall be
entitled to receive bonus compensation (at the time bonuses are normally paid)
based on the average of the regular annual bonuses (excluding the amount of any
special or spot bonuses) in respect of the two calendar years during the most
recent five calendar years for which the annual bonus received by the Executive
from the Company was the greatest, provided that such annual bonus shall not be
less than $462,500, but prorated according to the number of whole or partial
months the Executive was employed by the Company in such calendar year, and (ii)
the Trust Account shall be liquidated and revalued as provided in Annex A as of
the date of the Executive's death (except that all taxes shall be computed and
charged to the Trust Account as of such date of death to the extent not
theretofore so computed and charged) and the entire balance thereof (plus any
amount due under the last paragraph of Section A.6 of Annex A) shall be paid to
the Executive's estate (or a designated beneficiary) in a single payment not
later than 75 days following such date of death.

            7. Life Insurance. The Company shall continue to maintain $1,500,000
face amount of split ownership life insurance on the life of the Executive, to
be owned by the Company or the trustees of a trust for the benefit of the
Executive's spouse and/or descendants. The Company shall pay all premiums on
such policy and shall maintain such policy (without reduction of the face amount
of the coverage) until the Executive reaches age 65, whether or not the
Executive is an employee of the Company or any of its affiliates; provided,
however, that the Company's obligation to pay such premiums shall terminate on
the date the Executive's employment with the Company is terminated for cause
pursuant to Section 4.1 or the Executive terminates his employment in breach of
this Agreement. The Company shall not borrow from the cash value of such policy.
The Executive shall be entitled from time to time to designate the beneficiary
or beneficiaries of such policy which may include a trust. At the death of the
Executive, or on the earlier surrender of such policy by the owner, the
Executive agrees that the Executive's estate or the owner of the policy shall
promptly pay to the Company an amount equal to the premiums on such policy paid
by the Company (net of (i) tax benefits, if any, to the Company in respect of
payments of such premiums, (ii) any amounts payable by the Company which had
been paid by or on behalf of the Executive with respect to such insurance, (iii)
dividends received by the Company in respect of such premiums, but only to the
extent such dividends are not used to purchase additional insurance on the life
of the Executive, and (iv) any unpaid borrowings by the Company on the policy),
whether before, during or after the term of this Agreement. Unless 

<PAGE>   13
                                                                              13


the policy is owned by a trust, the Company shall own the policy and shall
provide by endorsement or collateral assignment as it may deem appropriate for
the payment of benefits on the death of the Executive. If the owner of the
policy is a trust, such owner shall execute, deliver and maintain a customary
split dollar insurance and collateral assignment form, assigning to the Company
the proceeds of such policy but only to the extent necessary to secure the
reimbursement obligation contained in the preceding sentence. At the time the
Executive reaches age 65, the Company shall offer the Executive the opportunity
to purchase such policy for the lesser of the net premiums paid by the Company
or the cash surrender value of such policy. The provisions of this Section 7
shall be in addition to any other insurance normally provided by the Company
under any group policy.

            8. Other Benefits.

                  8.1. General Availability. To the extent that (a) the
Executive is eligible under the general provisions thereof and (b) the Company
maintains such plan or program for the benefit of its senior executives, during
the term of employment and so long as the Executive is an employee of the
Company, the Executive shall be eligible to participate in any pension,
profit-sharing, stock option or similar plan or program and in any group
insurance, hospitalization, medical, dental, accident, disability or similar
plan or program of the Company now existing or established hereafter. In
addition, the Executive shall be entitled during the term of employment and so
long as the Executive is an employee of the Company, to receive other benefits
generally available to all senior executives of the Company to the extent the
Executive is eligible under the general provisions thereof, including, without
limitation, to the extent maintained in effect by the Company for its senior
executives, an automobile allowance and financial services.

                  8.2. Benefits After a Termination or Disability. During the
period the Executive remains on the payroll of the Company after a termination
pursuant to Section 4.2 and during the Disability Period the Executive shall
continue to be eligible to participate in the benefit plans and to receive the
benefits required to be provided to the Executive under Sections 7 and 8.1 to
the extent such benefits are maintained in effect by the Company for its senior
executives; provided, however, the Executive shall not be entitled to any
additional awards or grants under any stock option, restricted stock or other
stock based incentive plan. The Executive shall continue to be an employee of
the Company for purposes of any stock option and restricted shares agreements
and any other incentive plan awards during the term of employment and until such
time as the Executive shall leave the payroll of the Company. At the time the
Executive's term of employment with the Company terminates and he leaves the
payroll of the Company pursuant to the provisions of Section 4.1, 4.2, 5, 6 or
13, the Executive's rights to benefits and payments under any benefit plans or
any insurance or other death benefit plans or arrangements of the Company or
under any stock option, restricted

<PAGE>   14
                                                                              14


stock, stock appreciation right, bonus unit, management incentive or other plan
of the Company shall be determined, subject to the other terms and provisions of
this Agreement, in accordance with the terms and provisions of such plans and
any agreements under which such stock options, restricted stock or other awards
were granted; provided, however, that notwithstanding the foregoing or any more
restrictive provisions of any such plan or agreement, if the Executive leaves
the payroll of the Company as a result of a termination pursuant to Section 4.2,
then (i) all stock options granted to the Executive by the Company shall vest
and become immediately exercisable at the time the Executive shall leave the
payroll of the Company pursuant to Section 4.2, (ii) all stock options granted
to the Executive by the Company shall remain exercisable (but not beyond the
term thereof) during the remainder of the term of employment and the Advisory
Period and for a period of three months thereafter or such longer period as may
be specified in any stock option agreement and (iii) the Company shall not be
permitted to determine that the Executive's employment was terminated for
"unsatisfactory performance" within the meaning of any stock option agreement
between the Company and the Executive.

                  8.3. Payments in Lieu of Other Benefits. In the event the term
of employment and the Executive's employment with the Company is terminated
pursuant to Sections 4.1, 4.2, 5, 6 or 13 (and regardless of whether the
Executive elects clause (A) or (B) as provided in Section 4.2), the Executive
shall not be entitled to notice and severance or to be paid for any accrued
vacation time or unused sabbatical, the payments provided for in such Sections
being in lieu thereof.

                  8.4. Retirement Benefits. Upon the Executive's termination of
employment for any reason, except by the Company for cause pursuant to Section
4.1 and except for a termination by the Executive in breach of this Agreement,
the Company will calculate the retirement benefits to which the Executive is
entitled under the Time Warner Employees' Pension Plan, any supplemental
retirement or excess benefit plan maintained by the Company or any of its
affiliates or any successor plans thereto (hereinafter collectively referred to
as the "Pension Plan"), by crediting the Executive with an extra .9
(nine-tenths) of a year of service for each year the Executive is employed by
the Company up to a maximum of nine additional years of service. Such additional
pension benefits shall be paid at the same times and in the same manner as shall
be elected by the Executive or his beneficiary for payment of amounts under the
Pension Plan.

            9. Protection of Confidential Information; Non-Compete. The
provisions of Section 9.2 shall continue to apply through the latest of (i) the
end of the Advisory Period, (ii) the date the Executive ceases to be an employee
of the Company and leaves the payroll of the Company for any reason and (iii)
twelve months after the termination of the Executive's employment with the
Company pursuant to Section 4.1 or 4.2. The provisions of Sections 9.1

<PAGE>   15
                                                                              15


and 9.3 shall continue to apply until three years after the latest of the events
described in the preceding sentence.

                  9.1. Confidentiality Covenant. The Executive acknowledges that
his employment by the Company (which, for purposes of this Section 9 shall mean
Time Warner Inc. and its affiliates) will, throughout the term of employment,
bring him into close contact with many confidential affairs of the Company,
including information about costs, profits, markets, sales, products, key
personnel, pricing policies, operational methods, technical processes and other
business affairs and methods and other information not readily available to the
public, and plans for future development. The Executive further acknowledges
that the services to be performed under this Agreement are of a special, unique,
unusual, extraordinary and intellectual character. The Executive further
acknowledges that the business of the Company is international in scope, that
its products are marketed throughout the world, that the Company competes in
nearly all of its business activities with other Entities that are or could be
located in nearly any part of the world and that the nature of the Executive's
services, position and expertise are such that he is capable of competing with
the Company from nearly any location in the world. In recognition of the
foregoing, the Executive covenants and agrees:

                        9.1.1. The Executive shall keep secret all confidential
matters of the Company and shall not intentionally disclose such matters to
anyone outside of the Company, either during or after the term of employment,
except with the Company's written consent, provided that (i) the Executive shall
have no such obligation to the extent such matters are or become publicly known
other than as a result of the Executive's breach of his obligations hereunder
and (ii) the Executive may, after giving prior notice to the Company to the
extent practicable under the circumstances, disclose such matters to the extent
required by applicable laws or governmental regulations or judicial or
regulatory process;

                        9.1.2. The Executive shall deliver promptly to the
Company on termination of his employment by the Company, or at any other time
the Company may so request, at the Company's expense, all memoranda, notes,
records, reports and other documents (and all copies thereof) relating to the
Company's business, which he obtained while employed by, or otherwise serving or
acting on behalf of, the Company and which he may then possess or have under his
control; and

                        9.1.3. If the term of employment is terminated pursuant
to Section 4.1 or 4.2, for a period of one year after such termination, without
the prior written consent of the Company, the Executive shall not employ, and
shall not cause any Entity of which he is an affiliate to employ, any person who
was a full-time exempt employee of the Company at the date of such termination
or within six months prior thereto.

<PAGE>   16
                                                                              16


                  9.2. Non-Compete. The Executive shall not, directly or
indirectly, without the prior written consent of the Chief Executive Officer or
the President of the Company, render any services to any person or Entity or
acquire any interest of any type in any Entity, that might be deemed in
competition with the Company; provided, however, that the foregoing shall not be
deemed to prohibit the Executive from (a) acquiring, solely as an investment and
through market purchases, securities of any Entity which are registered under
Section 12(b) or 12(g) of the Securities Exchange Act of 1934 and which are
publicly traded, so long as he is not part of any control group of such Entity
and such securities, if converted, do not constitute more than one percent (1%)
of the outstanding voting power of that Entity, (b) acquiring, solely as an
investment, any securities of an Entity (other than an Entity that has
outstanding securities covered by the preceding clause (a)) so long as he
remains a passive investor in such Entity and does not become part of any
control group thereof and so long as such Entity is not, directly or indirectly,
in competition with the Company, or (c) serving as a director of any Entity that
is not in competition with the Company. For purposes of the foregoing, a person
or Entity shall be deemed to be in competition with the Company if such person
or it engages in any line of business that is substantially the same as either
(i) any line of operating business which the Company engages in, conducts or, to
the knowledge of the Executive, has definitive plans to engage in or conduct, or
(ii) any operating business that is engaged in or conducted by the Company and
as to which, to the knowledge of the Executive, the Company covenants in
writing, in connection with the disposition of such business, not to compete
therewith.

                  9.3. Specific Remedy. In addition to such other rights and
remedies as the Company may have at equity or in law with respect to any breach
of this Agreement, if the Executive commits a material breach of any of the
provisions of Section 9.1, the Company shall have the right and remedy to have
such provisions specifically enforced by any court having equity jurisdiction,
it being acknowledged and agreed that any such breach or threatened breach will
cause irreparable injury to the Company and that money damages will not provide
an adequate remedy to the Company.

            9.4. Liquidated Damages. If the Executive commits a material breach
of the provisions of Section 9.2, the Executive shall pay to the Company as
liquidated damages an amount equal to two and one-half times the Executive's
then current Base Salary, or if the Executive is not employed by the Company at
the time of such breach, an amount equal to two and one-half times the most
recent Base Salary paid to the Executive by the Company. The Company shall be
entitled to offset any amounts owed by the Executive to the Company under this
Section 9.4 against any amounts owed by the Company to the Executive under any
provision of this Agreement or otherwise, including without limitation, amounts
payable to the Executive under Sections 4.2. The Company and the Executive agree
that it is impossible to determine with any reasonable accuracy the amount of
prospective damages to 

<PAGE>   17
                                                                              17


the Company upon a breach of Section 9.2 by the Executive and further agree that
the damages set forth in this Section 9.4 are reasonable, and not a penalty,
based upon the facts and circumstances of the parties and with due regard to
future expectations.

            10. Ownership of Work Product. The Executive acknowledges that
during the term of employment and the Advisory Period, he may conceive of,
discover, invent or create inventions, improvements, new contributions, literary
property, material, ideas and discoveries, whether patentable or copyrightable
or not (all of the foregoing being collectively referred to herein as "Work
Product"), and that various business opportunities shall be presented to him by
reason of his employment by the Company. The Executive acknowledges that all of
the foregoing shall be owned by and belong exclusively to the Company and that
he shall have no personal interest therein, provided that they are either
related in any manner to the business (commercial or experimental) of the
Company, or are, in the case of Work Product, conceived or made on the Company's
time or with the use of the Company's facilities or materials, or, in the case
of business opportunities, are presented to him for the possible interest or
participation of the Company. The Executive shall (i) promptly disclose any such
Work Product and business opportunities to the Company; (ii) assign to the
Company, upon request and without additional compensation, the entire rights to
such Work Product and business opportunities; (iii) sign all papers necessary to
carry out the foregoing; and (iv) give testimony in support of his inventorship
or creation in any appropriate case. The Executive agrees that he will not
assert any rights to any Work Product or business opportunity as having been
made or acquired by him prior to the date of this Agreement except for Work
Product or business opportunities, if any, disclosed to and acknowledged by the
Company in writing prior to the date hereof.

            11. Notices. All notices, requests, consents and other
communications required or permitted to be given under this Agreement shall be
effective only if given in writing and shall be deemed to have been duly given
if delivered personally or sent by prepaid telegram, or mailed first-class,
postage prepaid, by registered or certified mail, as follows (or to such other
or additional address as either party shall designate by notice in writing to
the other in accordance herewith):

<PAGE>   18
                                                                              18


                  11.1. If to the Company:

                        Time Warner Inc.
                        75 Rockefeller Plaza
                        New York, New York 10019

                        Attention:  Chief Executive Officer

                        (with a copy, similarly addressed
                        but Attention:  General Counsel)

                  11.2. If to the Executive, to his residence address set forth
on the records of the Company.

            12. General.

                  12.1. Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the substantive laws of the State of
New York applicable to agreements made and to be performed entirely in New York.

                  12.2. Captions. The section headings contained herein are for
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.

                  12.3. Entire Agreement. This Agreement, including Annexes A
and B, sets forth the entire agreement and understanding of the parties relating
to the subject matter of this Agreement and supersedes all prior agreements,
arrangements and understandings, written or oral, between the parties, including
without limitation, the Prior Agreement.

                  12.4. No Other Representations. No representation, promise or
inducement has been made by either party that is not embodied in this Agreement,
and neither party shall be bound by or be liable for any alleged representation,
promise or inducement not so set forth.

                  12.5. Assignability. This Agreement and the Executive's rights
and obligations hereunder may not be assigned by the Executive. The Company may
assign its rights together with its obligations hereunder, in connection with
any sale, transfer or other disposition of all or substantially all of its
business and assets; and such rights and obligations shall inure to, and be
binding upon, any successor to all or substantially all of the business and

<PAGE>   19
                                                                              19


assets of the Company, whether by merger, purchase of stock or assets or
otherwise. The Company shall cause such successor expressly to assume such
obligations.

                  12.6. Amendments; Waivers. This Agreement may be amended,
modified, superseded, cancelled, renewed or extended and the terms or covenants
hereof may be waived only by written instrument executed by both of the parties
hereto, or in the case of a waiver, by the party waiving compliance. The failure
of either party at any time or times to require performance of any provision
hereof shall in no manner affect such party's right at a later time to enforce
the same. No waiver by either party of the breach of any term or covenant
contained in this Agreement, in any one or more instances, shall be deemed to
be, or construed as, a further or continuing waiver of any such breach, or a
waiver of the breach of any other term or covenant contained in this Agreement.

                  12.7. Resolution of Disputes. Any dispute or controversy
arising with respect to this Agreement shall, at the election of either the
Company or the Executive, be submitted to JAMS/ENDISPUTE for resolution in
arbitration in accordance with the rules and procedures of JAMS/ENDISPUTE.
Either party shall make such election by delivering written notice thereof to
the other party at any time (but not later than 45 days after such party
receives notice of the commencement of any administrative or regulatory
proceedings or the filing of any lawsuit relating to any such dispute or
controversy) and thereupon any such dispute or controversy shall be resolved
only in accordance with the provisions of this Section 12.7. Any such
proceedings shall take place in New York City before a single arbitrator (rather
than a panel of arbitrators), pursuant to any streamlined or expedited (rather
than a comprehensive) arbitration process, before a nonjudicial (rather than a
judicial) arbitrator, and in accordance with an arbitration process which, in
the judgment of such arbitrator, shall have the effect of reasonably limiting or
reducing the cost of such arbitration. The resolution of any such dispute or
controversy by the arbitrator appointed in accordance with the procedures of
JAMS/ENDISPUTE shall be final and binding. Judgment upon the award rendered by
such arbitrator may be entered in any court having jurisdiction thereof, and the
parties consent to the jurisdiction of the New York courts for this purpose. The
prevailing party shall be entitled to recover the costs of arbitration
(including reasonable attorneys fees and the fees of experts) from the losing
party. If at the time any dispute or controversy arises with respect to this
Agreement, JAMS/ENDISPUTE is not in business or is no longer providing
arbitration services, then the American Arbitration Association shall be
substituted for JAMS/ENDISPUTE for the purposes of the foregoing provisions of
this Section 12.7. If the Executive shall be the prevailing party in such
arbitration, the Company shall promptly pay, upon demand of the Executive, all
legal fees, court costs and other costs and expenses incurred by the Executive
in any legal action seeking to enforce the award in any court.

<PAGE>   20
                                                                              20


                  12.8. Beneficiaries. Whenever this Agreement provides for any
payment to the Executive's estate, such payment may be made instead to such
beneficiary or beneficiaries as the Executive may designate by written notice to
the Company. The Executive shall have the right to revoke any such designation
and to redesignate a beneficiary or beneficiaries by written notice to the
Company (and to any applicable insurance company) to such effect.

                  12.9. No Conflict. The Executive represents and warrants to
the Company that this Agreement is legal, valid and binding upon the Executive
and the execution of this Agreement and the performance of the Executive's
obligations hereunder does not and will not constitute a breach of, or conflict
with the terms or provisions of, any agreement or understanding to which the
Executive is a party (including, without limitation, any other employment
agreement). The Company represents and warrants to the Executive that this
Agreement is legal, valid and binding upon the Company and the execution of this
Agreement and the performance of the Company's obligations hereunder does not
and will not constitute a breach of, or conflict with the terms or provisions
of, any agreement or understanding to which the Company is a party.

                  12.10. Withholding Taxes. Payments made to the Executive
pursuant to this Agreement shall be subject to withholding and social security
taxes and other ordinary and customary payroll deductions.

                  12.11. No Offset. Except as provided in Section 9.4 of this
Agreement, neither the Company nor the Executive shall have any right to offset
any amounts owed by one party hereunder against amounts owed or claimed to be
owed to such party, whether pursuant to this Agreement or otherwise, and the
Company and the Executive shall make all the payments provided for in this
Agreement in a timely manner.

                  12.12. Severability. If any provision of this Agreement shall
be held invalid, the remainder of this Agreement shall not be affected thereby;
provided, however, that the parties shall negotiate in good faith with respect
to equitable modification of the provision or application thereof held to be
invalid. To the extent that it may effectively do so under applicable law, each
party hereby waives any provision of law which renders any provision of this
Agreement invalid, illegal or unenforceable in any respect.

                  12.13. Definitions. The following terms are defined in this
Agreement in the places indicated:

            Account Retained Income - Section A.6 of Annex A
            Advisory Period - Section 13

<PAGE>   21
                                                                              21


            affiliate - Section 4.2.3
            Applicable Tax Law - Section A.5 of Annex A
            Base Salary - Section 3.1
            cause - Section 4.1
            Code - Section 4.2.2
            Company - the first paragraph on page 1 and Section 9.1
            deferred compensation - Section 3.3
            Disability Date - Section 5
            Effective Date - the first paragraph on page 1
            eligible securities - Section A.1 of Annex A
            Entity - Section 2
            Executive - the first paragraph in page 1
            fair market value - Section A.1 of Annex A
            Investment Advisor - Section A.1 of Annex A
            Other Period Deferred Amount - Section A.6 of Annex A
            Pay-Out Period - Section A.6 of Annex A
            Pension Plan - Section 8.4
            Prior Account - Section 3.5
            Prior Agreement - the second paragraph on page 1
            Rabbi Trust - Section 3.3
            senior executives - Section 3.1
            term of employment - Section 1
            Trust Account - Section 3.3
            Trust Agreement - Section 3.3
            Trustee - Section 3.3
            Valuation Date - Section A.6 of Annex A
            Work Product - Section 10

            13. Advisory Services. The Executive shall render the advisory
services described in this Section for the period beginning on May 1, 2002 and
ending on April 30, 2003 (the "Advisory Period"). During the Advisory Period,
the Executive will provide such advisory services concerning the business,
affairs and management of the Company as may be requested by the Board of
Directors, the Chief Financial Officer or the President of the Company, but
shall not be required to devote more than five days (up to eight hours per day)
each month to such services, which shall be performed at a time and place
mutually convenient to both parties and consistent with the Executive's other
activities. If at any time during the Advisory Period, the Executive engages in
other full-time employment, the Executive shall not be deemed to be in breach of
this Section 13, but unless such employment consists of the Executive providing
services to one or more (i) charitable or non-profit organizations or (ii)
family-owned corporations, trusts, or partnerships, the term of employment and
the Advisory Period shall terminate, the Executive shall leave the payroll of

<PAGE>   22
                                                                              22


the Company and the Company shall have no further obligations under this
Agreement other than with respect to earned and unpaid compensation and
benefits. Notwithstanding the foregoing, but subject to Section 9.2 of this
Agreement, during the Advisory Period the Executive may provide part-time
services to third parties (including serving as a member of the Board of
Directors of any such party). During the Advisory Period, the Executive shall be
entitled to receive compensation in an amount equal to $350,000 per annum and
shall continue to be entitled to the benefits described in Sections 7 and 8
hereof; provided, however, that the Executive shall not be entitled to a driver
or automobile allowance or financial counseling during the Advisory Period,
shall not accrue any vacation time during the Advisory Period and shall not be
entitled to any severance pay at the end thereof. In addition, during the
Advisory Period the Company shall provide the Executive with an office, office
facilities and a secretary as described in Section 4.3 hereof.

            IN WITNESS WHEREOF, the parties have duly executed this Agreement as
of the date first above written.

                                    TIME WARNER INC.

                                    By /s/ Richard D. Parsons
                                       --------------------------------
                                       Richard D. Parsons
                                       President


                                       /s/ John A. LaBarca
                                       --------------------------------
                                       John A. LaBarca

<PAGE>   23

                                                                         ANNEX A

                          Deferred Compensation Account

            A.1 Investments. Funds credited to the Trust Account shall be
actually invested and reinvested in an account in securities selected from time
to time by an investment advisor designated from time to time by the Company
(the "Investment Advisor"), substantially all of which securities shall be
"eligible securities". The designation from time to time by the Company of an
Investment Advisor shall be subject to the approval of the Executive, which
approval shall not be withheld unreasonably. "Eligible securities" are common
and preferred stocks, warrants to purchase common or preferred stocks, put and
call options, and corporate or governmental bonds, notes and debentures, either
listed on a national securities exchange or for which price quotations are
published in newspapers of general circulation, including The Wall Street
Journal, and certificates of deposit. Eligible securities shall not include the
common or preferred stock, any warrants, options or rights to purchase common or
preferred stock or the notes or debentures of the Company or any corporation or
other entity of which the Company owns directly or indirectly 5% or more of any
class of outstanding equity securities. The Investment Advisor shall have the
right, from time to time, to designate eligible securities which shall be
actually purchased and sold for the Trust Account on the date of reference. Such
purchases may be made on margin; provided that the Company may, from time to
time, by written notice to the Executive, the Trustee and the Investment
Advisor, limit or prohibit margin purchases in any manner it deems prudent and,
upon three business days written notice to the Executive, the Trustee and the
Investment Advisor, cause all eligible securities theretofore purchased on
margin to be sold. The Investment Advisor shall send notification to the
Executive and the Trustee in writing of each transaction within five business
days thereafter and shall render to the Executive and the Trustee written
quarterly reports as to the current status of his or her Trust Account. In the
case of any purchase, the Trust Account shall be charged with a dollar amount
equal to the quantity and kind of securities purchased multiplied by the fair
market value of such securities on the date of reference and shall be credited
with the quantity and kind of securities so purchased. In the case of any sale,
the Trust Account shall be charged with the quantity and kind of securities sold
and shall be credited with a dollar amount equal to the quantity and kind of
securities sold multiplied by the fair market value of such securities on the
date of reference. Such charges and credits to the Trust Account shall take
place immediately upon the consummation of the transactions to which they
relate. As used herein "fair market value" means either (i) if the security is
actually purchased or sold by the Rabbi Trust on the date of reference, the
actual purchase or sale price per security to the Rabbi Trust or (ii) if the
security is not purchased or sold on the date of reference, in the case of a
listed security, the closing price per security on the date of reference, or if
there were no sales on such date, then the closing price per security on the
nearest preceding day on which there were such sales, and, in the case of an
unlisted security, the mean between the bid and asked prices per security on the

<PAGE>   24
                                                                             A-2


date of reference, or if no such prices are available for such date, then the
mean between the bid and asked prices per security on the nearest preceding day
for which such prices are available. If no bid or asked price information is
available with respect to a particular security, the price quoted to the Trustee
as the value of such security on the date of reference (or the nearest preceding
date for which such information is available) shall be used for purposes of
administering the Trust Account, including determining the fair market value of
such security. The Trust Account shall be charged currently with all interest
paid by the Trust Account with respect to any credit extended to the Trust
Account. Such interest shall be charged to the Trust Account, for margin
purchases actually made, at the rates and times actually paid by the Trust
Account. The Company may, in the Company's sole discretion, from time to time
serve as the lender with respect to any margin transactions by notice to the
then Investment Advisor and the Trustee and in such case interest shall be
charged at the rate and times then charged by an investment banking firm
designated by the Company with which the Company does significant business.
Brokerage fees shall be charged to the Trust Account at the rates and times
actually paid.

            A.2 Dividends and Interest. The Trust Account shall be credited with
dollar amounts equal to cash dividends paid from time to time upon the stocks
held therein. Dividends shall be credited as of the payment date. The Trust
Account shall similarly be credited with interest payable on interest bearing
securities held therein. Interest shall be credited as of the payment date,
except that in the case of purchases of interest-bearing securities the Trust
Account shall be charged with the dollar amount of interest accrued to the date
of purchase, and in the case of sales of such interest-bearing securities the
Trust Account shall be credited with the dollar amount of interest accrued to
the date of sale. All dollar amounts of dividends or interest credited to the
Trust Account pursuant to this Section A.2 shall be charged with all taxes
thereon deemed payable by the Company (as and when determined pursuant to
Section A.5). The Investment Advisor shall have the same right with respect to
the investment and reinvestment of net dividends and net interest as he has with
respect to the balance of the Trust Account.

            A.3 Adjustments. The Trust Account shall be equitably adjusted to
reflect stock dividends, stock splits, recapitalizations, mergers,
consolidations, reorganizations and other changes affecting the securities held
therein.

            A.4 Obligation of the Company. Without in any way limiting the
obligations of the Company otherwise set forth in the Agreement or this Annex A,
the Company shall have the obligation to establish, maintain and enforce the
Rabbi Trust and to make payments to the Trustee for credit to the Trust Account
in accordance with the provisions of Section 3.3 of the Agreement, to use due
care in selecting the Trustee or any successor trustee and to in all respects
work cooperatively with the Trustee to fulfill the 

<PAGE>   25
                                      A-3


obligations of the Company and the Trustee to the Executive. The Trust Account
shall be charged with all taxes (including stock transfer taxes), interest,
brokerage fees and investment advisory fees, if any, payable by the Company and
attributable to the purchase or disposition of securities designated by the
Investment Advisor (in all cases net after any tax benefits that the Company
would be deemed to derive from the payment thereof, as and when determined
pursuant to Section A.5) and only in the event of a default by the Company of
its obligation to pay such fees and expenses, the fees and expenses of the
Trustee in accordance with the terms of the Trust Agreement, but no other costs
of the Company. Subject to the terms of the Trust Agreement, the securities
purchased for the Trust Account as designated by the Investment Advisor, shall
remain the sole property of the Company, subject to the claims of its general
creditors as provided in the Trust Agreement. Neither the Executive nor his
legal representative nor any beneficiary designated by the Executive shall have
any right, other than the right of an unsecured general creditor, against the
Company or the Trust in respect of any portion of the Trust Account.

            A.5 Taxes. The Trust Account shall be charged with all federal,
state and local taxes deemed payable by the Company with respect to income
recognized upon the dividends and interest received by the Trust Account
pursuant to Section A.2 and gains recognized upon sales of any of the securities
which are sold pursuant to Section A.1, A.6 or A.7. The Trust Account shall be
credited with the amount of the tax benefit received by the Company as a result
of any payment of interest actually made pursuant to Section A.1 or A.2 and as a
result of any payment of brokerage fees and investment advisory fees made
pursuant to Section A.1. If any of the sales of the securities which are sold
pursuant to Section A.1, A.6 or A.7 results in a loss to the Trust Account, such
net loss shall be deemed to offset the income and gains referred to in the
second preceding sentence (and thus reduce the charge for taxes referred to
therein) to the extent then permitted under the Internal Revenue Code of 1986,
as amended from time to time, and under applicable state and local income and
franchise tax laws (collectively referred to as "Applicable Tax Law"); provided,
however, that for the purposes of this Section A.5 the Trust Account shall,
except as provided in the third following sentence, be deemed to be a separate
corporate taxpayer and the losses referred to above shall be deemed to offset
only the income and gains referred to in the second preceding sentence. Such
losses shall be carried back and carried forward within the Trust Account to the
extent permitted by Applicable Tax Law in order to minimize the taxes deemed
payable on such income and gains within the Trust Account. For the purposes of
this Section A.5, all charges and credits to the Trust Account for taxes shall
be deemed to be made as of the end of the Company's taxable year during which
the transactions, from which the liabilities for such taxes are deemed to have
arisen, are deemed to have occurred. Notwithstanding the foregoing, if and to
the extent that in any year there is a net loss in the Trust Account that cannot
be offset against income and gains in any prior year, then an amount equal to
the tax benefit to the Company of such net loss (after such net loss is reduced
by the amount of any 

<PAGE>   26
                                      A-4


net capital loss of the Trust Account for such year) shall be credited to the
Trust Account on the last day of such year. If and to the extent that any such
net loss of the Trust Account shall be utilized to determine a credit to the
Trust Account pursuant to the preceding sentence, it shall not thereafter be
carried forward under this Section A.5. For purposes of determining taxes
payable by the Company under any provision of this Annex A it shall be assumed
that the Company is a taxpayer and pays all taxes at the maximum marginal rate
of federal income taxes and state and local income and franchise taxes (net of
assumed federal income tax benefits) applicable to business corporations and
that all of such dividends, interest, gains and losses are allocable to its
corporate headquarters, which are currently located in New York City.

            A.6 One-Time Transfer to Deferred Plan. So long as the Executive is
an employee of the Company, the Executive shall have the right to elect at any
time, but only once during the Executive's lifetime, by written notice to the
Company to transfer to the Deferred Plan all or a portion of the Net
Transferable Balance (determined as provided in the next sentence) of the Trust
Account. If the Executive shall make such an election, the Net Transferable
Balance shall be determined as of the end of the calendar quarter following the
date of such election (unless such election is made during the ten calendar days
following the end of a calendar quarter, in which case such determination shall
be made as of the end of such preceding calendar quarter) by adjusting all of
the securities held in the Trust Account to their fair market value (net of the
tax adjustment that would be made thereon if sold, as estimated by the Company
or the Trustee) and by deducting from such value the amount of all outstanding
indebtedness and any other amounts payable by the Trust Account. Transfers to
the Deferred Plan shall be made in cash as promptly as reasonably practicable
after the end of such calendar quarter and the Investment Advisor (or the
Company or the Trustee if the Investment Advisor shall fail to act in a timely
manner) shall cause securities held in the Trust Account to be sold to provide
cash equal to the portion of the Net Transferable Balance of the Trust Account
selected to be transferred by the Executive. If the Executive elects to transfer
more than 75% of the Net Transferable Balance of the Trust Account to the
Deferred Plan, the Company or the Trustee shall be permitted to take such action
as they may deem reasonably appropriate, including but not limited to, retaining
a portion of such Net Transferable Balance in the Trust Account, to ensure that
the Trust Account will have sufficient assets to pay the Company the amount of
taxes payable on such sales of securities at the end of the year in which such
sales are made.

            A.7 Payments. Payments of deferred compensation shall be made as
provided in this Section A.7. Unless the Executive makes the election referred
to in the next succeeding sentence, deferred compensation shall be paid
bi-weekly for a period of ten years (the "Pay-Out Period") commencing on the
first Company payroll date in the month following the later of (i) the Term Date
and (ii) the date the Executive ceases to be an employee of the

<PAGE>   27
                                                                             A-5


Company and leaves the payroll of the Company for any reason, provided, however,
that if the Executive was named in the compensation table in the Company's then
most recent proxy statement, such payments shall commence on the first Company
payroll date in January of the year following the year in which the latest of
such events occurs. The Executive may elect a shorter Pay-Out Period by
delivering written notice to the Company or the Trustee at least one-year prior
to the commencement of the Pay-Out Period, which notice shall specify the
shorter Pay-Out Period. On each payment date, the Trust Account shall be charged
with the dollar amount of such payment. On each payment date, the amount of cash
held in the Trust Account shall be not less than the payment then due and the
Company or the Trustee may select the securities to be sold to provide such cash
if the Investment Advisor shall fail to do so on a timely basis. The amount of
any taxes payable with respect to any such sales shall be computed, as provided
in Section A.5 above, and deducted from the Trust Account, as of the end of the
taxable year of the Company during which such sales are deemed to have occurred.
Solely for the purpose of determining the amount of payments during the Pay-Out
Period, the Trust Account shall be valued on the fifth trading day prior to the
end of the month preceding the first payment of each year of the Pay-Out Period,
or more frequently at the Company's or the Trustee's election (the "Valuation
Date"), by adjusting all of the securities held in the Trust Account to their
fair market value (net of the tax adjustment that would be made thereon if sold,
as estimated by the Company or the Trustee) and by deducting from the Trust
Account the amount of all outstanding indebtedness. The extent, if any, by which
the Trust Account, valued as provided in the immediately preceding sentence,
plus any amounts that have been transferred to the Deferred Plan pursuant to
Section A.6 hereof and not theretofore distributed or deemed distributed
therefrom, exceeds the aggregate amount of credits to the Trust Account pursuant
to Sections 3.3, 3.4 and 3.5 of the Agreement as of each Valuation Date and not
theretofore distributed or deemed distributed pursuant to this Section A.7 is
herein called "Account Retained Income". The amount of each payment for the
year, or such shorter period as may be determined by the Company or the Trustee,
of the Pay-Out Period immediately succeeding such Valuation Date, including the
payment then due, shall be determined by dividing the aggregate value of the
Trust Account, as valued and adjusted pursuant to the second preceding sentence,
by the number of payments remaining to be paid in the Pay-Out Period, including
the payment then due; provided that each payment made shall be deemed made first
out of Account Retained Income (to the extent remaining after all prior
distributions thereof since the last Valuation Date). The balance of the Trust
Account, after all the securities held therein have been sold and all
indebtedness liquidated, shall be paid to the Executive in the final payment,
which shall be decreased by deducting therefrom the amount of all taxes
attributable to the sale of any securities held in the Trust Account since the
end of the preceding taxable year of the Company, which taxes shall be computed
as of the date of such payment.

<PAGE>   28
                                                                             A-6


            If this Agreement is terminated by the Company pursuant to Section
4.1 or if the Executive terminates this Agreement or the term of employment in
breach of this Agreement, the Trust Account shall be valued as of the later of
(i) the Term Date or (ii) twelve months after termination of the Executive's
employment with the Company, and the balance of the Trust Account, after the
securities held therein have been sold and all related indebtedness liquidated,
shall be paid to the Executive as soon as practicable and in any event within 75
days following the later of such dates in a final lump sum payment, which shall
be decreased by deducting therefrom the amount of all taxes attributable to the
sale of any securities held in the Trust Account since the end of the preceding
taxable year of the Company, which taxes shall be computed as of the date of
such payment. Payments made pursuant to this paragraph shall be deemed made
first out of Account Retained Income.

            If the Executive becomes disabled within the meaning of Section 5 of
the Agreement and is not thereafter returned to full-time employment with the
Company as provided in said Section 5, then deferred compensation shall be paid
bi-weekly during the Pay-Out Period commencing on the first Company payroll date
in the month following the end of the Disability Period in accordance with the
provisions of the first paragraph of this Section A.7.

            If the Executive shall die at any time whether during or after the
term of employment, the Trust Account shall be valued as of the date of the
Executive's death and the balance of the Trust Account shall be paid to the
Executive's estate or beneficiary within 75 days of such death in accordance
with the provisions of the second preceding paragraph.

            Notwithstanding the foregoing provisions of this Section A.7, if the
Rabbi Trust shall terminate in accordance with the provisions of the Trust
Agreement, the Trust Account shall be valued as of the date of such termination
and the balance of the Trust Account shall be paid to the Executive within 15
days of such termination in accordance with the provisions of the third
preceding paragraph.

            If a transfer to the Deferred Plan has been made pursuant to Section
A.6 hereof, payments made to the Executive from the Deferred Plan (a) shall be
deemed made first from the amounts transferred to the Deferred Plan pursuant to
Section A.6 and (b) shall be deemed made first out of Account Retained Income.

            Within 90 days after the end of each taxable year of the Company in
which payments are made, directly or indirectly, to the Executive from the Trust
Account or from the Deferred Plan with respect to amounts transferred to the
Deferred Plan from the Trust Account pursuant to Section A.6 and at the time of
the final payment from the Trust Account, the Company or the Trustee shall
compute and the Company shall pay to the Trustee for credit

<PAGE>   29
                                                                             A-7


to the Trust Account, the amount of the tax benefit assumed to be received by
the Company from the payment to the Executive of amounts of Account Retained
Income during such taxable year or since the end of the last taxable year, as
the case may be. No additional credits shall be made to the Trust Account
pursuant to the preceding sentence in respect of the amounts credited to the
Trust Account pursuant to the preceding sentence. Notwithstanding any provision
of this Section A.7, the Executive shall not be entitled to receive pursuant to
this Annex A (including any amounts that have been transferred to the Deferred
Plan pursuant to Section A.6 hereof) an aggregate amount that shall exceed the
sum of (i) all credits made to the Trust Account pursuant to Sections 3.3, 3.4
and 3.5 of the Agreement, (ii) the net cumulative amount (positive or negative)
of all income, gains, losses, interest and expenses charged or credited to the
Trust Account pursuant to this Annex A (excluding credits made pursuant to the
second preceding sentence), after all credits and charges to the Trust Account
with respect to the tax benefits or burdens thereof, and (iii) an amount equal
to the tax benefit to the Company from the payment of the amount (if positive)
determined under clause (ii) above; and the final payment(s) otherwise due may
be adjusted or eliminated accordingly. In determining the tax benefit to the
Company under clause (iii) above, the Company shall be deemed to have made the
payments under clause (ii) above with respect to the same taxable years and in
the same proportions as payments of Account Retained Income were actually made
from the Trust Account. Except as otherwise provided in this paragraph, the
computation of all taxes and tax benefits referred to in this Section A.7 shall
be determined in accordance with Section A.5 above.