exhibit10_3.htm


    Exhibit
10.3

     

    
      CONFIDENTIAL 

      
        CHARTER
COMMUNICATIONS, INC.

        2008
Incentive Program

        


        


        Program
Name

        
          	
                  ·  

                	
                  The
      Charter Communications, Inc. 2008 Incentive Program
      (“Program”).

                


        

        


        Purpose

        
          	
                  ·  

                	
                  The
      Program is designed to provide both annual and long-term incentive
      compensation to selected management employees who contribute and
      significantly impact the long term growth and success of Charter
      Communications, Inc. (“Company”).  It is focused on both
      retention and performance, and uses a combination of equity and cash
      incentives.

                


        

        


        Effective
Date

        
          	
                  ·  

                	
                  The
      effective date of the Program is January 1,
  2008.

                


        

        


        Program
Year

        
          	
                  ·  

                	
                  The
      Program operates on a calendar year basis, but portions of the awards
      under the Program are earned and paid in subsequent years and will
      increase or decrease in value based on the degree of attainment of
      performance goals and on the market value of the Company’s Class A common
      stock.

                


        

        


        Eligibility

        
        

        
          	
                  ·  

                	
                  
                    Incentive
      opportunities are defined generally by position and may vary based on
      responsibility and employment level.  Individual participation
      in the Program is at the discretion of the Compensation and Benefits
      Committee (the "Committee") of the Board of Directors which administers
      the Program.

                  

                


        

         

        
          	
                  ·  

                	
                  
                    
                      Employees
      shall be notified in writing of their eligibility to participate in the
      Program for each Program Year.  Participation in the Program for
      one year does not entitle an employee to participate in any subsequent
      year.

                    

                  

                


           

          
            	
                    ·  

                  	
                    
                      
                        
                          A
      written award agreement will document each respective component of a
      participant’s
award.

                        

                      

                    

                  


          

           

        

        Awards

        
          
            	
                    ·  

                  	
                    
                      
                        
                          
                            The
      total annual award for each participant will consist of three
      components.  One-third of the annual award will be in the form
      of time-vested restricted stock; one-third of the award will consist of
      Performance Units, and the remaining one-third of the award will consist
      of Performance Cash.  The Performance Units and Performance Cash
      awards will be earned and deposited in book-entry format into a
      Performance Bank, as described below, based on the degree of attainment by
      the Company of its performance goals.  Annually, one-third of
      the Performance Units and Performance Cash  in the Performance
      Bank will be paid based on attainment of financial and operational
      performance goals for the year of grant.  Two-thirds of the
      Performance Bank balance will remain to be augmented by any future
      performance awards and adjusted by Performance Interest (increases or
      decreases based on future performance of the Company). .  Each
      subsequent 

                          

                        

                      

                    

                  


          

           

        

        
        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        

          
            	
                      

                  	
                    year,
      participants will receive a payout equal to one-third of their Performance
      Bank balance, as adjusted based on attainment of the performance goals for
      the year immediately preceding the year of
  payment.

                  


          

           

        

        
          	
                  ·  

                	
                  Each
      participant will have a target, minimum and maximum incentive award
      opportunity for Performance Cash and Performance Unit awards. Attainment
      of the performance maximum will result in an actual award of 200% of
      target opportunity.  Attainment of the performance target will
      result in an actual award of 100% of target.  Attainment of the
      performance minimum or threshold level will result in an actual award of
      50% of target.  Except as otherwise provided in the Program, the
      participant must be actively employed on March 15 of the year following
      the applicable Program Year in order to receive any
  award.

                


        

         

        
          	
                  ·  

                	
                  The
      target award will be earned if stated performance objectives are
      achieved.  The threshold (minimum) and maximum awards will
      coincide with stated threshold and maximum performance
      objectives.

                


        

         

        
          	
                  ·  

                	
                  If
      the threshold level of performance is not achieved for the applicable
      measurements, no award payment will be
made.

                


        

         

        
          	
                  ·  

                	
                  If
      actual performance results are between the threshold and target, or the
      target and maximum levels, the award opportunity will be determined based
      on the scale provided.

                


        

         

        
          	
                  ·  

                	
                  If
      actual performance is above the maximum level, the award will be the
      maximum award allowable under the
Program.

                


        

        


        Performance
Measures

         

        
          	
                  ·  

                	
                  The
      performance metrics will be selected by the Committee may include such
      performance and operational criteria as revenue, adjusted EBITDA, free
      cash flow, unlevered free cash flow, average revenue per unit, operating
      cash flow, customer satisfaction or such other metrics as the Committee
      may approve and may change in any given Program Year.  The
      initial measures established for Performance Cash and Performance Units
      are revenue growth and unlevered free cash flow growth, as set forth in
      each award agreement.  Performance criteria and goals will be
      established in writing within 90 days after commencement of each Program
      Year and will be provided to the participants
  thereafter.

                


        

        
        

        
          
            	
                    ·  

                  	
                    
                      As
      soon as practicable after the close of the Program Year, the Committee
      will determine the actual level of performance.  This actual
      level of performance will be compared to the target and the deviation from
      target will be computed.  This deviation from target, expressed
      as a percentage, will determine the Performance Cash and Performance Unit
      awards earned, if any, for each
  participant.

                    

                  


          

           

        

        
          	
                  ·  

                	
                  The
      Committee will approve final awards and, in its sole discretion, may make
      discretionary adjustments as required to reflect the relative performance
      of the participant(s).

                


        

        


        
          
            
            

          

          
            - 2
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        Vesting
and Payment of Awards

        
          	
                  ·  

                	
                  Performance
      Cash –Earned Performance Cash will be credited to a Performance
      Cash Bank.  Each year, the Performance Cash balance in the
      participant’s Performance Cash Bank will be subject to adjustment based on
      attainment of the performance goals for the immediately preceding Program
      Year, as shown in the award agreement.  After adjustment,
      one-third of the Performance Cash balance in the participant’s Performance
      Cash Bank will be paid in a cash lump sum payment to the participant, net
      of all required tax withholding.  Two-thirds of the Performance
      Cash balance in the participant’s Performance Cash Bank will remain to be
      augmented by any future Performance Cash awards and adjusted by
      Performance Interest.

                


        

         

        
          	
                  ·  

                	
                  Performance
      Units –Earned Performance Units will be credited to a Performance
      Units Bank.  Each year, the Performance Units balance in the
      participant’s Performance Units Bank will be subject to adjustment based
      on attainment of the performance goals for the immediately preceding
      Program Year, as shown in the award agreement.  After
      adjustment, one-third of the Performance Units balance in the
      participant’s Performance Units Bank will then be distributed in whole
      shares of the Company's Class A common stock; no fractional shares will be
      paid.  Two-thirds of the Performance Unit balance in the
      participant’s Performance Units Bank will remain to be augmented by any
      future Performance Unit awards and adjusted by Performance
      Interest.

                


        

         

        
          	
                  · 

                	
                  Restricted
      Stock – One-third of the restricted Stock award will vest on each
      of the first three anniversary dates of the date of
  award.

                


        

        


        
          	
                  ·  

                	
                  One-third
      of the amounts credited to the Performance Bank (as adjusted based on
      achievement of the performance goals for the Program Year) are payable on
      March 15 of the year following the Program Year.  Except as
      otherwise provided in the Program, a participant must be actively employed
      on the payment date to receive
payment.

                


        

        


        Termination
of Employment

        
          	
                  ·  

                	
                  Except
      as otherwise provided in a written employment agreement, in the event of a
      participant’s termination of employment, awards and Performance Bank
      balances will be paid or forfeited as
follows:

                


        

         

        
          	
                  ·  

                	
                  

                    Voluntary
      Termination, Termination for Cause, Death, Termination on Account of
      Disability.  All
      unvested restricted stock, all Performance Bank Balance amounts and all
      unearned Performance Units awards and Performance Cash awards will be
      forfeited upon the occurrence of any of these events prior to the day of
      payment or vesting (in the case of restricted
  stock).

                  

                


        

         

        
          	
                  ·  

                	
                  

                    

                      Involuntary
      Termination – Without Cause or for Good
      Reason.
      In the event of an involuntary termination by the Company without
      Cause or by a participant for Good Reason, the current Program Year
      Performance Cash and Performance Unit awards will be
      forfeited.  If termination occurs on or after September 15 and
      before the following March 15, any amounts credited to the Performance
      Cash Bank and Performance Units Bank that are otherwise payable on March
      15 following termination of employment will be paid on that date, and the
      remainder will be forfeited. If termination of employment occurs on or
      after March 15 and before the following September 15, any amounts then
      

                    

                  

                


        

         

        
        

        
 

        
          
            
            

          

          
            - 3
-

            
              

            

          

          
            
            

          

        

        


        
          	
                    

                	
                  credited
      to the Performance Cash Bank and Performance Units Bank shall be
      forfeited.  Any unvested restricted stock that was scheduled to
      vest within the one year period following termination of employment will
      be vested on termination of employment and any remaining restricted stock
      will be forfeited.

                


        

         

        
          	
                  ·  

                	
                  

                    

                      

                        Termination
      of Employment without Cause or for Good Reason within 12 months following
      a Change in Control.  The current Program Year
      Performance Cash and Performance Unit awards will be paid at target level
      on termination of employment.  Any amounts credited to the
      Performance Bank will be paid on termination of employment.  All
      unvested restricted stock awards shall immediately vest. (The awards of
      the Chief Executive Officer, Executive Vice Presidents and Senior Vice
      Presidents are limited in the event that a Change of Control occurs within
      90 days of the grant of the
    award.)

                      

                    

                  

                


        

         

        
          	
                  ·  

                	
                  

                    

                      

                        

                          Retirement.  The current Program Year
      Performance Cash and Performance Unit awards will be
      forfeited.  Any amounts credited or to be credited to the
      Performance Cash Bank and Performance Units Bank will be paid (without
      future adjustment) to the participant in three annual installments,
      commencing on March 15 following the date of Retirement.  All
      unvested restricted stock awards will immediately
      vest.

                        

                      

                    

                  

                


For
purposes of the Program, “Cause,” “Good Reason,” “Change in Control,” and
“Retirement” have the meaning set forth in the 2001 Stock Incentive
Plan.

        


        Section
409A Compliance

          	
                  ·  

                	
                  

                    

                      

                        

                                
                            Notwithstanding
      any other provision of the Program to the contrary, if the participant is
      a “Specified Employee” on the date of termination of the participant’s
      employment, the participant may not receive a payment of “nonqualified
      deferred compensation” for which the payment event is “separation from
      service,” as defined in Internal Revenue Code Section 409A and the
      regulations thereunder, until at least six months after the date of
      termination.  Any payment of nonqualified deferred compensation
      otherwise due in such six month period shall be suspended and become
      payable at the end of such six month
      period.

                          

                        

                      

                    

                  

                


        

         

        
          
          

        

        
          	
                  ·  

                	
                  A
      “Specified Employee” means a specified employee as defined in Treas. Reg.
      §1.409A-1(i) (generally, officers earning more than $145,000 per year, as
      indexed for inflation, who are among the fifty highest paid
      employees).

                


        

        


        Miscellaneous

         

        
          	
                  ·  

                	
                  The
      Program is not a contract of employment, nor is any portion of the Program
      to be construed as a contract for continued employment, whether for the
      duration of the Program, or
thereafter.

                


        

         

        
          	
                  ·  

                	
                  No
      participant shall have the right to anticipate, sell, transfer, assign,
      pledge or encumber his or her right to receive any award made under the
      Program until such an award becomes payable to him or
  her.

                


        

         

        
          	
                  ·  

                	
                  No
      participant shall have any lien on any assets of the Company by reason of
      any award made under the Program.

                


        

         

         

        
          
            
            

          

          
            - 4
-

            
              

            

          

          
            
            

          

        

         

        
          	
                  ·  

                	
                  Performance
      Cash awards under the Program will be paid out of the general assets of
      the Company, dependent upon the achievement of certain performance goals
      and continued employment through the applicable date.  Equity
      awards will be granted under the Company’s 2001 Stock Incentive Plan or
      any successor equity plan for employees of the Company and are subject to
      approval of such successor plan by the Company's stockholders. Any payment
      in shares of Company's Class A common stock will be issued under those
      plans, if approved.

                


        

        


        Administration

        
          	
                  ·  

                	
                  The
      Committee may review this Program annually and make changes in Program
      participation, target incentives, determination of performance factor
      benchmarks or any other aspect of this Program.  Such review may
      include, but not be limited to, the
following:

                


        

         

        
          	
                  ·  

                	
                  To
      interpret the Program and to prescribe, amend and/or eliminate
      administrative guidelines.

                


        

         

        
          	
                  ·  

                	
                  To
      adjust individual awards, upwards or downwards, in its sole
      discretion.

                


        

         

        
          	
                  ·  

                	
                  To
      establish award opportunities for each
position.

                


        

         

        
          	
                  ·  

                	
                  To
      recommend to the Board of Directors the termination of the Program at any
      time without decreasing the value of awards previously earned and still
      outstanding.

                


        

         

        
          	
                  ·  

                	
                  The
      receipt of an award shall not give an employee any right to continued
      employment.  The receipt of an award with respect to any Program
      Year shall not entitle an employee to an award with respect to any
      subsequent Program Year.

                


        

        


        


        


        
          
            
            

          

          
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