Document:

exv10w7

Exhibit 10.7

EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (this “Agreement”) dated as of July 29, 2011 among Donegal Mutual
Insurance Company, a Pennsylvania mutual insurance company having its principal place of business
at 1195 River Road, Marietta, Pennsylvania 17547 (“Donegal Mutual”), Donegal Group Inc., a Delaware
corporation having its principal place of business at 1195 River Road, Marietta, Pennsylvania 17547
(“DGI,” and, together with Donegal Mutual, the “Employers”), and Daniel J. Wagner, an individual
whose principal office address is 1195 River Road, Marietta, Pennsylvania 17547 (the “Executive”).

WITNESSETH:

     WHEREAS, the Employers desire, by this Agreement, to provide for the continued employment of
the Executive by the Employers, and the Executive agrees to the continued employment of the
Executive by the Employers, all in accordance with the terms and subject to the conditions set
forth in this Agreement; and

     WHEREAS, the parties are entering into this Agreement to set forth and confirm their
respective rights and obligations with respect to the Executive’s continued employment by the
Employers;

     NOW, THEREFORE, in consideration of the premises and the mutual covenants contained in this
Agreement, the Employers and the Executive, intending to be legally bound hereby, mutually agree as
follows:

     1. Employment and Term.

          (a) (i) Effective August 1, 2011 (the “Effective Date”), (i) Donegal Mutual agrees to continue
to employ the Executive, and the Executive agrees to continue the Executive’s employment as, the
Senior Vice President and Treasurer of Donegal Mutual and (ii) DGI agrees to employ the Executive,
and the Executive agrees to continue the Executive’s employment as, the Senior Vice President and
Treasurer of DGI, with positions described in clauses (i) and (ii) collectively referred to in this
Agreement as the “Position”, in accordance with the terms and subject to the conditions this
Agreement sets forth. Donegal Mutual and DGI shall be jointly and severally liable to the
Executive with respect to (i) all liabilities of Donegal Mutual to the Executive under this
Agreement and (ii) all liabilities of DGI to the Executive under this Agreement; provided, however,
that Donegal Mutual shall not be responsible for any liability of DGI to the Executive to the
extent that DGI has discharged such liability, and DGI shall not be responsible for any liability
of Donegal Mutual to the Executive to the extent that Donegal Mutual has discharged such liability.

 

 

               (ii) The term of this Agreement, as the same may be extended from time to time pursuant to the
provisions of this clause (ii) or otherwise, shall commence on the Effective Date and end on the
third anniversary of the Effective Date, provided, however, that on the first anniversary of the
Effective Date and on each subsequent anniversary of the Effective Date (each, an “Extension
Date”), the Term shall automatically extend for one additional year so that on each such succeeding
Extension Date, this Agreement shall have a remaining Term of three years, unless either the
Executive or the respective board of directors of Donegal Mutual and DGI (together, the “Boards”)
give notice to the other, not less than 90 days in advance of the next succeeding Extension Date,
that such automatic extensions shall terminate as of such next succeeding Extension Date, unless
the Employers earlier terminate the employment of the Executive for Cause, as defined in this
Agreement, or because of the death or the Permanent Disability, as defined in this Agreement, of
the Executive.

          (b) Notwithstanding paragraph 1(a) of this Agreement, the Employers, by action of the Boards
and effective as specified in a written notice thereof to the Executive in accordance with the
terms of this Agreement, shall have the right to terminate the Executive’s employment under this
Agreement at any time during the Term, for Cause or other than for Cause or on account of the
Executive’s death or Permanent Disability subject to the provisions of this paragraph 1.

               (i) As used in this Agreement, “Cause” shall mean (A) the Executive’s willful and continued
failure substantially to perform the Executive’s material duties with the Employers as set forth in
this Agreement, or the commission by the Executive of any activities constituting a willful
violation or breach under any material federal, state or local law or regulation applicable to the
activities of Donegal Mutual or DGI or their respective subsidiaries and affiliates, in each case,
after notice of such failure, breach or violation from the Employers to the Executive and a
reasonable opportunity for the Executive to cure such failure, breach or violation in all material
respects, (B) fraud, breach of fiduciary duty, dishonesty, misappropriation or other actions by the
Executive that cause intentional material damage to the property or business of Donegal Mutual or
DGI or their respective subsidiaries and affiliates, (C) the Executive’s repeated absences from
work such that the Executive is substantially unable to perform the Executive’s duties under this
Agreement in all material respects other than for physical or mental impairment or illness or (D)
the Executive’s non-compliance with the provisions of paragraph 2(b) of this Agreement after notice
of such non-compliance from the Employers to the Executive and a reasonable opportunity for the
Executive to cure such non-compliance.

               (ii) As used in this Agreement, “Permanent Disability” shall mean a physical or mental
disability of the Executive such that the Executive is substantially unable to perform those duties
that the Executive would otherwise reasonably be expected to continue to perform and the
Executive’s nonperformance of such duties has continued for a

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period of 180 consecutive days, provided, however, that in order to terminate the Executive’s
employment under this Agreement on account of Permanent Disability, the Employers must provide the
Executive with written notice of the Boards’ good faith determinations to terminate the Executive’s
employment under this Agreement for reason of Permanent Disability not less than 30 days prior to
such termination, and such notice shall specify the date of termination. Until the specified
effective date of termination by reason of Permanent Disability, the Executive shall continue to
receive compensation at the rates set forth in paragraph 3 of this Agreement. No termination of
the Executive’s employment under this Agreement because of Permanent Disability shall impair any
rights of the Executive under any disability insurance policy the Employers maintained at the
commencement of the aforesaid 180-day period.

          (c) The Executive shall have the right to terminate the Executive’s employment under this
Agreement at any time during the Term for Good Reason or without Good Reason or in the event a
Change of Control occurs. As used in this Agreement, “Good Reason” shall mean (A) a material
diminishment of the Executive’s Position or the scope of the Executive’s authority, duties or
responsibilities as this Agreement describes without the Executive’s written consent, excluding for
this purpose any action the Employers do not take in bad faith and that the Employers remedy
promptly following written notice thereof from the Executive to the Employers, or (B) a material
breach by either Employer of its respective obligations to the Executive under this Agreement,
provided, that with respect to any termination by the Executive for Good Reason, the Executive
shall have provided the Employers with written notice within 90 days of the date on which the
Employers first had actual knowledge of the existence of the Good Reason and which Good Reason
shall not have been cured or otherwise rectified by the Employers in all material respects to the
reasonable satisfaction of the Executive within 30 days after the Employers receive such written
notice or (C) any termination of the Executive’s employment under this Agreement without Cause.

          (d) “Change of Control” shall mean (A) the acquisition of shares of DGI by any “person” or
“group,” as Rule 13d-3 uses such terms under the Securities Exchange Act of 1934, as now or
hereafter amended, in a transaction or series of transactions that result in such person or group
directly or indirectly first owning after the Effective Date more than 25% of the aggregate voting
power of DGI’s Class A common stock and Class B common stock taken as a single class, (B) the
consummation of a merger or other business combination transaction after which the holders of the
outstanding voting capital stock of DGI taken as a single class do not collectively own 60% or more
of the aggregate voting power of the entity surviving such merger or other business combination
transaction, (C) the sale, lease, exchange or other transfer in a transaction or series of
transactions of all or substantially all of the assets of DGI, but excluding therefrom the sale and
re-investment of the consolidated investment portfolio of DGI and its subsidiaries, (D) as the
result of or in connection with any cash tender offer or exchange offer, merger or other business
combination transaction, sale of assets or contested-election of directors or any combination of
the foregoing transactions or

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(E) a change of “control” of Donegal Mutual as such term is defined in the Pennsylvania
Insurance Holding Companies Act (each, a “Transaction”), the persons who constituted a majority of
the members of the respective Boards on the Effective Date and persons whose election as members of
the respective Boards received the approval of such members then still in office or whose
subsequent election had been so approved prior to the date of a Transaction, but before the
occurrence of an event that constitutes a Change of Control, no longer constitute such a majority
of the Boards then in office. A Transaction constituting a Change of Control shall only be deemed
to have occurred upon the closing of the Transaction.

          (e) (i) If (A) the Employers terminate the Executive’s employment under this Agreement for any
reason other than for Cause and such termination occurs as of a date that is within 180 days
preceding or within 180 days after the consummation of a Change of Control (such 180-day period
preceding the Change of Control and such 180-day period after the Change of Control collectively
referred to in this Agreement as a “Change of Control Period”, (B) the Employers terminate this
Agreement as a result of the death or Permanent Disability of the Executive, effective as of a date
within a Change of Control Period, (C) the Executive terminates the Executive’s employment under
this Agreement for Good Reason or (D) the acquisition of “control” of Donegal Mutual as defined in
the Pennsylvania Insurance Holding Companies Act, the Employers shall pay to the Executive or the
Executive’s estate promptly after the event giving rise to such payment occurs, an amount equal to
the sum of (x) (1) the Executive’s Base Salary, as defined in this Agreement, accrued through the
date the termination of the Executive’s employment under this Agreement is effective, (2) any
incentive, as defined in this Agreement, the Employers have the obligation to pay to the Executive
pursuant to paragraph 3(b) of this Agreement, (3) any amounts payable under any of the Employers’
benefit plans in accordance with the terms of such plans, except as Section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”) may otherwise require and (4) any amount in respect
of excise taxes the Employers have the obligation to pay to the Executive pursuant to paragraph
1(f) of this Agreement, with such payments, rights and benefits described in clauses (x)(1), (x)(2)
and (x)(3) of this Agreement being collectively referred to in this Agreement as the “Accrued
Obligations,” (y) an amount equal to the aggregate premiums that the Executive would have to pay to
maintain in effect throughout the period (the “Subsequent Period”) from the date of termination of
the Executive’s employment under this Agreement through the remainder of the Term had the Executive
remained employed, assuming no increase in insurance premium rates, the same medical, health,
disability and life insurance coverage the Employers provided to the Executive immediately prior to
the date of such termination (the “Benefit Obligations”) and (z) the Employers shall pay to the
Executive or the Executive’s estate, as a severance payment, for three years from the date of such
termination, the Executive’s annual Base Salary as of the effective date of termination of the
Executive’s employment under this Agreement and any incentive paid to the Executive during the last
completed fiscal year of the Employers before

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such termination. The Employers shall pay such amounts for the Executive in 36 equal monthly
installments.

               (ii) If (A) the Employers terminate the Executive’s employment under this Agreement for any
reason other than for Cause effective as of a date that is not within a Change of Control Period or
(B) the Executive terminates the Executive’s employment under this Agreement for Good Reason
effective as of a date that is not within a Change of Control Period, the Employers shall pay the
Executive, provided the Executive concurrently signs and delivers a general release in a
commercially reasonable form that is mutually acceptable to the Employers and the Executive in
favor of the Employers and their respective subsidiaries, an amount equal to the sum of (w) the
Accrued Obligations, (x) the Benefit Obligations and (y) the Executive’s Base Salary as of the
effective date of termination of the Executive’s employment under this Agreement the Executive
would have received had the Executive remained employed under this Agreement for the Subsequent
Period. The Employers shall pay such amounts to the Executive at the same time and in the same
installments had the Executive remained employed under this Agreement for the Subsequent Period.

               (iii) If (A) the Employers terminate the Executive’s employment under this Agreement for Cause
or because of the death or Permanent Disability of the Executive or (B) the Executive terminates
the Executive’s employment under this Agreement for any reason other than Good Reason, the
Executive’s death or Permanent Disability, or (C) the Employers terminate this Agreement as a
result of the death or Permanent Disability of the Executive effective as of a date that is not
within a Change of Control Period, the sole obligation of the Employers to the Executive under this
Agreement shall be to pay the Accrued Obligations to the Executive or the Executive’s estate,
provided, however, that in the event the Employers terminate the employment of the Executive under
this Agreement because of the death of the Executive, the Employers shall pay to the personal
representatives of the Executive an amount equal to the Executive’s Base Salary and incentive for
the remainder of the Term.

               (iv) No provision of this Agreement shall adversely affect any vested rights of the Executive
under the Employers’ existing employee benefit plans or other plans the Employers may establish in
the future; provided, however, upon the termination of the employment of the Executive as provided
in this Agreement, all future vesting of the Executive’s rights under all existing and any future
employee benefit plans shall terminate without further action by the Employers.

               (v) The Employers and the Executive intend that this Agreement be drafted and administered in
compliance with Section 409A of the Code, including, but not limited to, any future amendments to
Section 409A, and any other Internal Revenue Service (“IRS”) or other governmental rulings or
interpretations (together, “Section 409A”) issued pursuant to Section 409A so as not to subject the
Executive to payment of interest or any

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additional tax under Section 409A. The Employers and the Executives intend for any payments
under paragraphs 1(e)(i), (ii) or (iii) to satisfy either the requirements of Section 409A or to be
exempt from the application of Section 409A, and the Employers and the Executive shall construe and
interpret this Agreement accordingly. In furtherance of such intent, if payment or provision of
any amount or benefit under this Agreement that is subject to Section 409A at the time specified in
this Agreement would subject such amount or benefit to any additional tax under Section 409A, the
Employers shall postpone payment or provision of such amount or benefit to the earliest
commencement date on which the Employers can make such payment or provision of such amount or
benefit without incurring such additional tax but not in excess of six months. In addition, to the
extent that any IRS guidance issued under Section 409A would result in the Executive being subject
to the payment of interest or any additional tax under Section 409A, the Employers and the
Executive agree, to the extent reasonably possible, to amend this Agreement in order to avoid the
imposition of any such interest or additional tax under Section 409A. Any such amendment shall
have the minimum economic effect necessary and be determined reasonably and in good faith by the
Employers and the Executive.

               (vi) If a payment under paragraph 1(e)(i), (ii) or (iii) of this Agreement does not qualify as
a short-term deferral under Section 409A or any similar or successor provisions, and the Executive
is a Specified Employee, as defined in this Agreement, as of the Executive’s Termination Date, the
Employers may not make such distributions to the Executive before a date that is six months after
the date of the Executive’s Termination Date or, if earlier, the date of the Executive’s death (the
“Six-Month Delay”). The Employers shall accumulate payments to which the Executive would otherwise
be entitled during the first six months following the Termination Date (the “Six-Month Delay
Period”) and make such payments on the first day of the seventh month following the Executive’s
Termination Date. Notwithstanding the Six-Month Delay set forth in this paragraph 1(e)(vi):

     (A) To the maximum extent Section 409A or any similar or successor
provisions permit, during each month of the Six-Month Delay Period, the
Employers will pay the Executive an amount equal to the lesser of (I) the
total monthly severance for which paragraph 1(e)(ii) and (iii) provide or (II)
one-sixth of the lesser of (1) the maximum amount that Section 401(a)(17)
permits to be taken into account under a qualified plan for the year in which
the Executive’s Date of Termination occurs and (2) the sum of the Executive’s
annualized compensation based upon the annual rate of pay for services
provided to the Employers for the taxable year of the Executive preceding the
taxable year of the Executive in which the Executive’s Termination Date
occurs, adjusted for any increase during that year that the parties expected
to continue indefinitely if the Executive’s Termination Date has not occurred
; provided that amounts paid under this sentence will count toward, and

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will not be in addition to, the total payment amount the Employers have
the obligation to pay to the Executive under paragraphs 1(e)(i) and (ii) of
this Agreement; and

     (B) To the maximum extent Section 409A, or any similar or successor
provisions, permits within ten days following the Executive’s Termination
Date, the Employers shall pay the Executive an amount equal to the applicable
dollar amount under Section 402(g)(1)(B) for the year in which the Executive’s
Termination Date occurred; provided that the amount the Employers pay under
this sentence may include, and need not be in addition to, the total payment
amount this Agreement requires the Employers to pay to the Executive under
paragraph 1(b).

     (C) For purposes of this Agreement, “Specified Employee” has the meaning
given that term in Section 409A or any similar or successor provisions. The
Employers’ “specified employee identification date” as described in Section
409A will be December 31 of each year, and the Employers’ “specified employee
effective date” as described in Section 409A or any similar or successor
provisions) will be February 1 of each succeeding year.

          (f) In the event that the independent registered public accounting firm of either of the
Employers or the IRS determines that any payment, coverage or benefit provided to the Executive
pursuant to this Agreement is subject to the excise tax imposed by Sections 280G or 4999 or any
successor provisions of Sections 280G and 4999 or any interest or penalties the Executive incurs
with respect to such excise tax, the Employers, within 30 days thereafter, shall pay to the
Executive, in addition to any other payment, coverage or benefit due and owing under this
Agreement, an additional amount that will result in the Executive’s net after tax position, after
taking into account any interest, penalties or taxes imposed on the amounts payable under this
paragraph 1(f), upon the receipt of the payments for which this Agreement provides being no less
advantageous to the Executive than the net after tax position to the Executive that would have been
obtained had Sections 280G and 4999 not been applicable to such payment, coverage or benefits.
Except as this Agreement otherwise provides, tax counsel, whose selection shall be reasonably
acceptable to the Executive and the Employers and whose fees and costs shall be paid for by the
Employers, shall make all determinations this paragraph 1(f) requires.

          (g) In the event that the independent registered public accounting firm of either of the
Employers or the IRS determines that any payment, coverage or benefit due or owing to the Executive
pursuant to this Agreement is subject to the excise tax Section 409A imposes or any successor
provision of Section 409A or any interest or penalties, including interest imposed under Section
409(A)(1)(B)(i)(I), the Executive incurs as a result of the application of such provision, the
Employers, within 30 days of the date of such impositions,

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shall pay to the Executive, in addition to any other payment, coverage or benefit due and
owing under this Agreement, an additional amount that will result in the Executive’s net after tax
position, after taking into account any interest, penalties or taxes imposed on the amounts paid
under this paragraph 1(g), being no less advantageous to the Executive than the net after tax
position the Executive would have obtained had Section 409A not been applicable to such payment,
coverage or benefits. Except as this Agreement otherwise provides, tax counsel, whose selection
shall be reasonably acceptable to the Executive and the Employers and whose fees and costs the
Employers shall pay, shall make all determinations this paragraph 1(g) requires.

          (h) The Employers and the Executive shall give any notice of termination of this Agreement to
the Executive or the Employers, as the case may be, in accordance with the provisions of paragraph
10.

          (i) The Employers agree to reimburse the Executive for the reasonable fees and expenses of the
Executive’s attorneys and for court and related costs in any proceeding to enforce the provisions
of this Agreement in which the Executive is successful on the merits.

     2. Duties of the Executive.

          (a) Subject to the ultimate control and discretion of the Boards, the Executive shall serve in
the Position and perform all duties and services commensurate with the Position. Throughout the
Term of this Agreement as the same may be extended from time to time, the Executive shall perform
all duties reasonably assigned or delegated to the Executive under the By-laws of the Employers or
from time to time by the Boards consistent with the Position. Except for travel normally
incidental and reasonably necessary to the business of the Employers and the duties of the
Executive under this Agreement, the duties of the Executive shall be performed from an office
location not greater than 35 miles from Marietta, Pennsylvania.

          (b) The Executive shall devote substantially all of the Executive’s business time and
attention to the performance of the Executive’s duties under this Agreement and, during the term of
the Executive’s employment under this Agreement, the Executive shall not engage in any other
business enterprise that requires any significant amount of the Executive’s personal time or
attention, unless granted the prior permission of the respective Boards. The foregoing provision
shall not prevent the Executive’s purchase, ownership or sale of any interest in, or the
Executive’s engaging in, any business that does not compete with the business of the Employers or
the Executive’s involvement in charitable or community activities, provided, that the time and
attention that the Executive devotes to such business and charitable or community activities does
not materially interfere with the performance of the Executive’s duties under this Agreement and
that a material portion of the time the Executive devotes to charitable or community activities are
devoted to charitable

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or community activities within the Employers’ market area and further provided that such
conduct complies in all material respects with applicable policies of the Employers.

          (c) The Employers shall accrue earned but unused vacation in accordance with the Employers’
vacation policy.

     3. Compensation. For all services the Executive renders under this Agreement:

          (a) The Employers shall pay the Executive a base salary (the “Base Salary”) at an annual rate
equal to the annual rate of compensation the Executive is currently receiving from the Employers,
plus such other compensation as the Employers may, from time to time, determine. The Employers
shall pay such Base Salary and other compensation in accordance with the Employers’ normal payroll
practices as in effect from time to time.

          (b) The Employers agree that the Executive shall be entitled to participate in the annual
incentive programs of the Employers, in accordance in all material respects with applicable
policies of the Employers relating to incentive compensation for executive officers, based on the
objectives set forth in the Employers’ Executive Incentive Plan.

          (c) The compensation provided for in this paragraph 3 shall be in addition to such rights as
the Executive may have, during the Executive’s employment under this Agreement or after such
employment, to participate in and receive benefits from or under any benefit plans the Employers
may in their discretion establish for their employees or executives, including, but not limited to,
employee benefit plans and group health insurance, life insurance and disability insurance plans.
To the extent the Executive incurs a tax liability as a result of any of such benefits, the
Executive shall be solely responsible for such taxes.

          (d) The parties acknowledge that Towers Watson is in the process of evaluating the
compensation and employee benefit plans the Employers make available to their senior executive
officers. To the extent the respective boards of directors of the Employers, based upon the
recommendations of Towers Watson, to enhance the compensation and other benefits the Employers make
available to their senior executive officers, the Employers and the Executive agree to negotiate in
good faith and to execute an amendment to this Agreement that would appropriately reflect such
enhancements.

     4. Expenses. The Employers shall promptly reimburse the Executive for all reasonable
expenses the Executive pays or incurs in connection with the performance of the Executive’s duties
and responsibilities under this Agreement, upon presentation of expense vouchers or other
appropriate documentation therefor.

     5. Indemnification. Notwithstanding anything in the Employers’ respective
certificates or articles of incorporation or their By-laws to the contrary, the Employers shall at
all times indemnify the Executive during the Executive’s employment by the Employers or while the
Executive is providing consulting services to the Employers, and thereafter, to the

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fullest extent applicable law permits for any matter in any way relating to the Executive’s
employment by, consultation with or other affiliation with the Employers or its subsidiaries;
provided, however, that if the Employers shall have terminated the Executive’s employment under
this Agreement for Cause, then, except to the extent otherwise required by law, the Employers shall
have no obligation whatsoever to indemnify the Executive for any claim arising out of the matter
for which the Employer shall have terminated the Executive’s employment under this Agreement for
Cause or for any conduct of the Executive not within the scope of the Executive’s duties under this
Agreement.

     6. Confidential Information. The Executive understands that in the course of the
Executive’s employment by the Employers the Executive will receive confidential information
concerning the business of the Employers and that the Employers desire to protect. The Executive
agrees that the Executive will not at any time during or after the period of the Executive’s
employment by the Employers reveal to anyone outside the Employers, or use for the Executive’s own
benefit, any such information that the Employers have designated as confidential or that the
Executive understood to be confidential without specific designation by the Employers. Upon
termination of the employment of the Executive under this Agreement, and upon the request of the
Employers, the Executive shall promptly deliver to the Employers any and all written materials,
records and documents, including all copies of such written materials, documents and records, the
Executive made or that come into the Executive’s possession during the Term and the Executive
retained that contain or concern confidential information of the Employers and all other written
materials the Employers furnished to the Executive for the Executive’s use during the Term,
including all copies of such written materials, documents and records, whether of a confidential
nature or otherwise.

     7. Representation and Warranty of the Executive. The Executive represents and
warrants that the Executive is not under any obligation, contractual or otherwise, to any other
firm or corporation, which would prevent the Executive’s performance of the terms of this
Agreement.

     8. Entire Agreement; Amendment. This Agreement and the Consulting Agreement contain
the entire agreement between the Employers and the Executive with respect to the subject matter of
this Agreement, and may not be amended, waived, changed, modified or discharged except by an
instrument in writing executed by the Employers and the Executive.

     9. Assignability. The services of the Executive under this Agreement are personal in
nature, and the Employers may not assign their respective rights or obligations under this
Agreement, whether by operation of law or otherwise, without the Executive’s prior written consent.
This Agreement shall be binding upon, and inure to the benefit of, the Employers and their
permitted successors and assigns under this Agreement. This Agreement shall not

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be assignable by the Executive, but shall inure to the benefit of the Executive’s heirs,
executors, administrators and personal representatives.

     10. Notice. Any notice that a party to this Agreement may give under this Agreement
shall be in writing and be deemed given when hand delivered and acknowledged or, if mailed, one day
after mailing by registered or certified mail, return receipt requested, or if delivered by an
overnight delivery service, one day after the notice is delivered to such service, to the Employers
or the Executive at their respective addresses stated in the preamble to this Agreement, or at such
other address as either party may by similar notice designate.

     11. Specific Performance. The Employers and the Executive agree that irreparable
damage would occur in the event that any of the provisions of paragraph 6 of this Agreement were
not performed in accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the Employers and the Executive shall have the right to an injunction or
injunctions to prevent breaches of such paragraph 6 and to enforce specifically the terms and
provisions of such paragraph 6, this being in addition to any other remedy to which the Employers
or the Executive are entitled at law or in equity.

     12. No Third Party Beneficiaries. Nothing in this Agreement, express or implied,
shall confer upon any person or entity other than the Employers and the Executive (and the
Executive’s heirs, executors, administrators and personal representatives) any rights or remedies
of any nature under or by reason of this Agreement.

     13. Successor Liability. The Employers shall require any successor, whether direct or
indirect, by purchase, merger, consolidation or otherwise, to all or substantially all of the
business or assets of the Employers to assume expressly and agree to perform this Agreement in the
same manner and to the same extent that the Employers would be required to perform it if no such
succession had taken place.

     14. Mitigation. The Executive shall not be required to mitigate the amount of any
payment provided for in this Agreement by seeking other employment or otherwise, nor shall the
amount of any payment or benefit provided for in this Agreement be reduced by any compensation the
Executive earns as the result of employment by another employer or by retirement benefits payable
after the termination of this Agreement, except that the Employers shall not be required to provide
the Executive and the Executive’s eligible dependents with medical insurance coverage as long as
the Executive and the Executive’s eligible dependents are receiving comparable medical insurance
coverage from another employer.

     15. Waiver of Breach. The failure at any time to enforce or exercise any right under
any of the provisions of this Agreement or to require at any time performance by the other parties
of any of the provisions hereof shall in no way be construed to be a waiver of such provisions or
to affect either the validity of this Agreement or any part of this Agreement, or

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the right of any party hereafter to enforce or exercise its rights under each and every
provision in accordance with the terms of this Agreement.

     16. No Attachment. Except as required by law, no right to receive payments under this
Agreement shall be subject to anticipation, commutation, alienation, sale, assignment, encumbrance,
charge, pledge or hypothecation or to execution, attachment, levy or similar process or assignment
by operation of law, and any attempt, voluntary or involuntary, to effect any such action shall be
null, void and of no effect; provided, however, that nothing in this paragraph 16 shall preclude
the assumption of such rights by executors, administrators or other legal representatives of the
Executive or the Executive’s estate and their assigning any rights hereunder to the person or
persons entitled to such rights.

     17. Severability. The invalidity or unenforceability of any term, phrase, clause,
paragraph, restriction, covenant, agreement or other provision of this Agreement shall in no way
affect the validity or enforceability of any other provision, or any part of this Agreement, but
this Agreement shall be construed as if such invalid or unenforceable term, phrase, clause,
paragraph, restriction, covenant, agreement or other provision had never been contained in this
Agreement unless the deletion of such term, phrase, clause, paragraph, restriction, covenant,
agreement or other provision would result in such a material change as to cause the covenants and
agreements contained in this Agreement to be unreasonable or would materially and adversely
frustrate the objectives of the Employers and the Executive as expressed in this Agreement.

     18. Construction. This Agreement shall be governed by and construed in accordance
with the internal laws of the Commonwealth of Pennsylvania, without giving effect to principles of
conflict of laws. All headings in this Agreement have been inserted solely for convenience of
reference only, are not to be considered a part of this Agreement and shall not affect the
interpretation of any of the provisions of this Agreement.

-12-

 

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

	 	 	 	 	 
	 	DONEGAL MUTUAL INSURANCE COMPANY

 	 
	 	By:  	/s/ Donald H. Nikolaus
 	 
	 	 	Donald H. Nikolaus, President and Chief
   Executive Officer 	 
	 	 	 	 
	 
	 	DONEGAL GROUP INC.

 	 
	 	By:  	/s/ Jeffrey D. Miller
 	 
	 	 	Jeffrey D. Miller, Senior Vice President and 	 
	 	 	Chief Financial Officer 	 
	 
	 	 	 
	 	/s/ Daniel J. Wagner
 	 
	 	Daniel J. Wagner 	 
	 	 	 
	 

-13-exv10w1

Exhibit 10.1

     AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”) made July 29, 2011 effective
as of January 1, 2011 (the “Effective Date”) between TIME WARNER INC., a Delaware corporation (the
“Company”), and John Martin (“You”).

     You are currently employed by the Company pursuant to an Amended and Restated Employment
Agreement made April 29, 2010, effective as of January 1, 2010, which amended and superseded an
agreement made December 19, 2008, effective as of December 1, 2008, and an agreement made December
20, 2007, effective as of January 1, 2008 (the “Initial Effective Date”) (the “Prior Agreements”).
The Company wishes to amend and restate the terms of your employment with the Company and to secure
your services on a full-time basis for the period to and including December 31, 2013 on and subject
to the terms and conditions set forth in this Agreement, and you are willing to provide such
services on and subject to the terms and conditions set forth in this Agreement. You and the
Company therefore agree as follows:

     1. Term of Employment. Your “term of employment” as this phrase is used throughout
this Agreement shall be for the period beginning on the Effective Date and ending on December 31,
2013 (the “Term Date”), subject, however, to earlier termination as set forth in this Agreement.

     2. Employment. During the term of employment, you shall serve as Chief Financial
and Administrative Officer of the Company or in such other senior position as the Company may
determine and you shall have the authority, functions, duties, powers and responsibilities normally
associated with such position and such additional authority, functions, duties, powers and
responsibilities as may be assigned to you from time to time by the Company consistent with your
senior position with the Company. During the term of employment, (i) your services shall be
rendered on a substantially full-time, exclusive basis and you will apply on a full-time basis all
of your skill and experience to the performance of your duties, (ii) you shall have no other
employment and, without the prior written consent of your manager or other more senior officer of
the Company in your reporting line, no outside business activities which require the devotion of
substantial amounts of your time, (iii) you shall report to the Chief Executive Officer of the
Company, and (iv) the place for the performance of your services shall be the principal executive
offices of the Company in the New York City metropolitan area, subject to such reasonable travel as
may be required in the performance of your duties. 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.

     3. Compensation.

          3.1 Base Salary. The Company shall pay you a base salary at the rate of not less
than $1,600,000 per annum during the term of employment (“Base Salary”). The Company shall make a
payment promptly following the execution of this Agreement of the difference between the former
salary and the increased salary for the period from the Effective Date to the date of execution.
The Company may increase, but not decrease without your consent, your Base Salary during the term
of employment. Base Salary shall be paid in accordance with the Company’s customary payroll
practices.

          3.2 Bonus. In addition to Base Salary, the Company typically pays its executives an
annual cash bonus (“Bonus”). Although your Bonus is fully discretionary your target annual Bonus
as a percentage of Base Salary is 300%. The Company may increase, but not decrease without your
consent, your target annual Bonus during the term of employment. Each year, your personal
performance will be considered in the context of your executive duties and any individual goals set
for you, and your actual Bonus will be determined based on your personal performance and the
Company’s performance. Your Bonus amount, if any, will be paid to you between January 1 and March
15 of the calendar year immediately following the performance year in respect of which such Bonus
is earned.

          3.3 Long Term Incentive Compensation. So long as the term of employment has not
terminated the Company annually shall provide you with long term incentive compensation with a
target value of $4,300,000 (based on the valuation method used by the Company for its senior
executives) through a combination of stock option grants, restricted stock units, performance
shares or other equity-based awards, cash-based long-term plans or other components as may be
determined by the Compensation and Human Development Committee of the Company’s Board of Directors
from time to time in its sole discretion.

          3.4 Indemnification. You shall be entitled throughout the term of employment (and
after the end of the term of employment, to the extent relating to service during the term of
employment) to the benefit of the indemnification provisions

2

 

contained on the Effective Date in the Restated Certificate of Incorporation and By-laws of
the Company (not including any amendments or additions after the Effective Date that limit or
narrow, but including any that add to or broaden, the protection afforded to you by those
provisions).

          3.5. Make-Whole RSUs. In accordance with Section 3.5 of the Prior Agreements, on
January 2, 2008, you were awarded 31,682 restricted stock units (the “Make Whole RSUs,” reflecting
the adjustments made to outstanding RSUs in connection with the separations of Time Warner Cable
Inc. and AOL Inc. in 2009 and the 1 for 3 reverse stock split that that became effective March 27,
2009. The Make Whole RSUs are reflected in a restricted stock units agreement that provides that
the Make Whole RSUs will have accelerated vesting on a pro rated basis on the Severance Term Date
in the event of a termination of employment pursuant to Section 4.2.

     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”. Termination by the Company for “cause” shall mean termination
because of your (a) 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), (b) willful failure or refusal
without proper cause to perform your duties with the Company, including your obligations under this
Agreement (other than any such failure resulting from your incapacity due to physical or mental
impairment), (c) misappropriation, embezzlement or reckless or willful destruction of Company
property, (d) breach of any statutory or common law duty of loyalty to the Company, (e) intentional
and improper conduct materially prejudicial to the business of the Company or any of its
affiliates, or (f) breach of any of the covenants provided for in Section 8 hereof. Such
termination shall be effected by written notice thereof delivered by the Company to you and shall
be effective as of the date of such notice; provided, however, that if (i) such termination is
because of your willful failure or refusal without proper cause to perform any one or more of your
obligations under this Agreement, (ii) such notice is the first such notice of termination for any
reason delivered by the Company to you under this Section 4.1, and (iii) within 15 days following
the date of such notice you shall cease your refusal and shall use your best efforts to perform
such obligations, the termination shall not be effective.

3

 

          In the event of 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
obligation to you other than (i) to pay Base Salary through the effective date of the termination
of employment (the “Effective Termination Date”), (ii) to pay any Bonus for any year prior to the
year in which such termination occurs that has been determined but not yet paid as of the Effective
Termination Date, and (iii) with respect to any rights you have pursuant to any insurance or other
benefit plans or arrangements of the Company. You hereby disclaim any right to receive a pro rata
portion of any Bonus with respect to the year in which such termination occurs.

          4.2 Termination by You 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 Period shall be in effect, you shall have the right, exercisable by written
notice to the Company, to terminate the term of employment under this Agreement with an Effective
Termination Date 30 days after the giving of such notice, if, at the time of the giving of such
notice, the Company is 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 you pursuant to this Section 4.2
and within such 30-day period the Company shall have cured all such material breaches; and provided
further, that such notice is provided to the Company within 90 days after the occurrence of such
material breach. A material breach by the Company shall include, but not be limited to, (i) the
Company violating Section 2 with respect to authority, reporting, duties, or place of employment or
(ii) the Company failing to cause any 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 you delivered before the
date which is 60 days prior to the Term Date, to terminate your employment under this Agreement
without cause, which notice shall specify the Effective Termination Date. If such notice is
delivered on or after the date which is 60 days prior to the Term Date, the provisions of Section
4.3 shall apply.

               4.2.1 In the event of a termination of employment pursuant to this Section 4.2 (a
“termination without cause”), you shall receive Base Salary and a pro

4

 

rata portion of your Average Annual Bonus (as defined below) through the Effective Termination
Date. Your Average Annual Bonus shall be 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 three calendar years for which the annual bonus received by you from the Company
was the greatest. Your pro rata Average Annual Bonus pursuant to this Section 4.2.1 shall be paid
to you at the times set forth in Section 4.6.

               4.2.2 After the Effective Termination Date, you shall continue to be treated as an employee of
the Company for a period ending on the date which is twenty-four months after the Effective
Termination Date if the Effective Termination Date occurs prior to the Term Date and twelve months
after the Effective Termination Date if the Effective Termination Date occurs on or after the Term
Date (such date, the “Severance Term Date”), and during such period you shall be entitled to
receive, whether or not you become disabled during such period but subject to Section 6, (a) Base
Salary (on the Company’s normal payroll payment dates as in effect immediately prior to the
Effective Termination Date) at an annual rate equal to your Base Salary in effect immediately prior
to the notice of termination, and (b) an annual Bonus in respect of each calendar year or portion
thereof (in which case a pro rata portion of such Bonus will be payable) during such period equal
to your Average Annual Bonus. Except as provided in the next sentence, if you accept other
full-time employment during such period or notify the Company in writing of your intention to
terminate your status of being treated as an employee during such period, you shall cease to be
treated as an employee of the Company for purposes of your rights to receive certain
post-termination benefits under Section 7.2 effective upon the commencement of such other
employment or the date specified by you in such notice, whichever is applicable (the “Equity
Cessation Date”), and you shall receive the remaining payments of Base Salary and Bonus pursuant to
this Section 4.2.2 at the times specified in Section 4.6 of the Agreement. Notwithstanding the
foregoing, if you accept employment with any not-for-profit entity or governmental entity, then you
may continue to be treated as an employee of the Company for purposes of your rights to receive
certain post-termination benefits pursuant to Section 7.2 and you will continue to receive the
payments as provided in the first sentence of this Section 4.2.2; and if you accept full-time
employment with any affiliate of the Company, then the payments provided for in this Section 4.2.2
shall immediately cease and you shall not be entitled to any further payments. 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

5

 

with, the Company.

          4.3 After the Term Date. If at the Term Date, the term of employment shall not
have been previously terminated pursuant to the provisions of this Agreement, no Disability Period
is then in effect and the parties shall not have agreed to an extension or renewal of this
Agreement or on the terms of a new employment agreement, then the term of employment shall continue
on a month-to-month basis and you shall continue to be employed by the Company pursuant to the
terms of this Agreement, subject to termination by either party hereto on 60 days written notice
delivered to the other party (which notice may be delivered by either party at any time on or after
the date which is 60 days prior to the Term Date). If the Company shall terminate the term of
employment on or after the Term Date for any reason (other than for cause as defined in Section
4.1, in which case Section 4.1 shall apply), which the Company shall have the right to do so long
as no Disability Date (as defined in Section 5) has occurred prior to the delivery by the Company
of written notice of termination, then such termination shall be deemed for all purposes of this
Agreement to be a “termination without cause” under Section 4.2; and the provisions of Sections
4.2.1 and 4.2.2 shall apply, except that the period for which you shall continue to be treated as
an employee following the Effective Termination Date will be twelve months.

          4.4 Release. A condition precedent to the Company’s obligation to make or continue
the payments associated with a termination without cause shall be your execution and delivery of a
release in the form attached hereto as Annex A, or as such form may be updated by the Company as
required by law, within 60 days following your Effective Termination Date. If you shall fail to
timely execute and deliver such release, or if you revoke such release as provided therein, then in
lieu of continuing to receive the payments provided for herein, you shall receive a severance
payment determined in accordance with the Company’s policies relating to notice and severance
reduced by the aggregate amount of severance payments paid pursuant to this Agreement, if any,
prior to the date of your refusal to deliver, or revocation of, such release. Any such severance
payments shall be paid in the form of Base Salary continuation payments at the annual rate equal to
your Base Salary in effect immediately prior to your notice of termination, with such amounts paid
until your severance benefit has been exhausted.

          4.5 Mitigation. In the event of a termination without cause under

6

 

this Agreement, you shall not be required to take actions in order to mitigate your damages
hereunder, unless Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”),would
apply to any payments to you by the Company and your failure to mitigate would result in the
Company losing tax deductions to which it would otherwise have been entitled. In such an event,
Section 4.7.1 shall govern. With respect to the preceding sentences, any payments or rights to
which you are entitled by reason of the termination of employment without cause shall be considered
as damages hereunder. Any obligation to mitigate your damages pursuant to this Section 4.5 shall
not be a defense or offset to the Company’s obligation to pay you in full the amounts provided in
this Agreement upon the occurrence of a termination without cause, at the time provided herein, or
the timely and full performance of any of the Company’s other obligations under this Agreement.

          4.6 Payments. Payments of Base Salary and Bonus required to be made to you after
any termination shall be made at the same times as such payments otherwise would have been paid to
you pursuant to Sections 3.1 and 3.2 if you had not been terminated, subject to Section 11.17.

          4.7 Limitation on Certain Payments. Notwithstanding any other provision of this
Agreement:

               4.7.1. In the event the Company (or its successor) determines, based on the advice of an
independent nationally recognized public accounting firm engaged by the Company, that part or all
of the consideration, compensation or benefits to be paid to you under this Agreement constitute
“parachute payments” under Section 280G(b)(2) of the Code, then, if the aggregate present value of
such parachute payments, singularly or together with the aggregate present value of any
consideration, compensation or benefits to be paid to you under any other plan, arrangement or
agreement which constitute “parachute payments” (collectively, the “Parachute Amount”) exceeds 2.99
times your “base amount”, as defined in Section 280G(b)(3) of the Code (the “Base Amount”), the
amounts constituting “parachute payments” which would otherwise be payable to you or for your
benefit shall be reduced to the extent necessary so that the Parachute Amount is equal to 2.99
times the Base Amount (the “Reduced Amount”); provided that such amounts shall not be so reduced if
the Company determines, based on the advice of such public accounting firm, that without such
reduction you would be entitled to receive and retain, on a net after tax basis (including, without
limitation, any excise taxes payable under Section 4999 of the Code), an amount which is greater
than the

7

 

amount, on a net after tax basis, that you would be entitled to retain upon receipt of the Reduced
Amount.

               4.7.2. If the determination made pursuant to Section 4.7.1 results in a reduction of the
payments that would otherwise be paid to you except for the application of Section 4.7.1, such
reduction in payments shall be first applied to reduce any cash severance payments that you would
otherwise be entitled to receive hereunder and shall thereafter be applied to reduce other payments
and benefits in a manner that would not result in subjecting you to additional taxation under
Section 409A of the Code, unless you elect to have the reduction in payments applied in a different
order. Within ten days following such determination, the Company shall pay or distribute to you or
for your benefit such amounts as are then due to you under this Agreement and shall promptly pay or
distribute to you or for your benefit in the future such amounts as become due to you under this
Agreement.

               4.7.3. As a result of the uncertainty in the application of Sections 280G and 4999 of the Code
at the time of a determination hereunder, it is possible that payments will be made by the Company
that should not have been made under Section 4.7.1 (an “Overpayment”). In the event that there is a
final determination by the Internal Revenue Service, or a final determination by a court of
competent jurisdiction, that an Overpayment has been made, the Company shall have no further
liability or obligation to you for any excise taxes, interest or penalty that you are required to
pay as a result of such final determination.

          4.8 Retirement. Notwithstanding the provisions of this Agreement relating to a
termination without cause and Disability, on the date you first become eligible for normal
retirement as defined in any applicable retirement plan (i.e., age 65) of the Company or any
subsidiary of the Company (the “Retirement Date”), then this Agreement shall terminate
automatically on such date and your employment with the Company shall thereafter be governed by the
policies generally applicable to employees of the Company, and you shall not thereafter be entitled
to the payments provided in this Agreement to the extent not received by you on or prior to the
Retirement Date. In addition, no benefits or payments provided in this Agreement relating to
termination without cause and Disability shall include any period after the Retirement Date and if
the provision of benefits or calculation of payments provided in this Agreement with respect
thereto would include any period subsequent to the Retirement Date, such provision of benefits
shall end on the

8

 

Retirement Date and the calculation of payments shall cover only the period ending on the
Retirement Date.

     5. Disability.

          5.1 Disability Payments. If during the term of employment and prior to the
delivery of any notice of termination without cause, you become physically or mentally disabled,
whether totally or partially, so that you are prevented from performing your 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 your full compensation 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”), subject to Section 11.17. If you have not
resumed your usual duties on or prior to the Disability Date, the Company shall pay you a pro rata
Bonus (based on your Average Annual Bonus) for the year in which the Disability Date occurs and
thereafter shall pay you disability benefits for the period ending on the later of (i) the Term
Date or (ii) the date which is twelve months after the Disability Date (in the case of either (i)
or (ii), the “Disability Period”), in an annual amount equal to 75% of (a) your Base Salary at the
time you become disabled and (b) the Average Annual Bonus, in each case, subject to Section 11.17.

          5.2 Recovery from Disability. If during the Disability Period you shall fully
recover from your disability, the Company shall have the right (exercisable within 60 days after
notice from you of such recovery), but not the obligation, to restore you to full-time service at
full compensation. If the Company elects to restore you to full-time service, then this Agreement
shall continue in full force and effect in all respects and the Term Date shall not be extended by
virtue of the occurrence of the Disability Period. If the Company elects not to restore you to
full-time service, you shall be entitled to obtain other employment, subject, however, to the
following: (i) you shall perform advisory services during any balance of the Disability Period;
and (ii) you shall comply with the provisions of Sections 8 and 9 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

9

 

Chief Executive Officer or other senior officer of the Company but you 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.

          5.3 Other Disability Provisions. The Company shall be entitled to deduct from all
payments to be made to you during the Disability Period pursuant to this Section 5 an amount equal
to all disability payments received by you during the Disability Period from Worker’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 you from such disability insurance
policies are not includible in your 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. Except as otherwise
provided in this Section 5, the term of employment shall continue during the Disability Period and
you shall be entitled to all of the rights and benefits provided for in this Agreement, except that
Sections 4.2 and 4.3 shall not apply during the Disability Period, and unless the Company has
restored you to full-time service at full compensation prior to the end of the Disability Period,
the term of employment shall end and you shall cease to be an employee of the Company at the end of
the Disability Period and shall not be entitled to notice and severance or to receive or be paid
for any accrued vacation time or unused sabbatical.

     6. Death. If you die during the term of employment, this Agreement and all
obligations of the Company to make any payments hereunder shall terminate except that your estate
(or a designated beneficiary) shall be entitled to receive Base Salary to the last day of the month
in which your death occurs and Bonus compensation (at the time bonuses are normally paid) based on
the Average Annual Bonus, but prorated according to the number of whole or partial months you were
employed by the Company in such calendar year.

     7. Other Benefits.

10

 

          7.1 General Availability. To the extent that (a) you are eligible under the
general provisions thereof (including without limitation, any plan provision providing for
participation to be limited to persons who were employees of the Company or certain of its
subsidiaries prior to a specific point in time) and (b) the Company maintains such plan or program
for the benefit of its executives, during the term of your employment with the Company, you shall
be eligible to participate in any savings plan, or similar plan or program and in any group life
insurance, hospitalization, medical, dental, accident, disability or similar plan or program of the
Company now existing or established hereafter.

          7.2 Benefits After a Termination or Disability. After the Effective
Termination Date of employment pursuant to Section 4.2 and prior to the Severance Term Date or
during the Disability Period, you shall continue to be treated as an employee of the Company for
purposes of eligibility to participate in the Company’s health and welfare benefit plans other than
disability programs and to receive the health and welfare benefits (other than disability programs)
required to be provided to you under this Agreement to the extent such health and welfare benefits
are maintained in effect by the Company for its executives. After the Effective Termination Date
of a termination of employment pursuant to Section 4 or during a Disability Period, you shall not
be entitled to any additional awards or grants under any stock option, restricted stock or other
stock-based incentive plan and you shall not be entitled to continue elective deferrals in or
accrue additional benefits under any qualified or nonqualified retirement programs maintained by
the Company. At the Severance Term Date your rights to benefits and payments under any health and
welfare benefit plans or any insurance or other death benefit plans or arrangements of the Company
shall be determined in accordance with the terms and provisions of such plans. At the Severance
Term Date or, if earlier, the Equity Cessation Date, your rights to benefits and payments under any
stock option, restricted stock, stock appreciation right, bonus unit, management incentive or other
long-term incentive plan of the Company shall be determined 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. However, consistent with the terms of the employment agreement dated as
of February 13, 2002 between the Company and you (which terms were carried forward to the
employment agreement between you and Time Warner Entertainment Company, L.P. and to the Prior
Agreements), notwithstanding the foregoing or any more restrictive provisions of any such plan or
agreement, if your employment with the Company is

11

 

terminated as a result of a termination pursuant to Section 4.2, then, (i) all stock options to
purchase shares of Time Warner Common Stock shall continue to vest, and any such vested stock
options shall remain exercisable (but not beyond the term of such options), through the earlier of
the Severance Term Date or the Equity Cessation Date; (ii) except if you shall then qualify for
retirement under the terms of the applicable stock option agreement and would receive more
favorable treatment under the terms of the stock option agreement, (x) all stock options to
purchase shares of Time Warner Common Stock granted to you on or after February 1, 2002 (the “Term
Options”) that would have vested on or before the Severance Term Date (or the comparable date under
any employment agreement that amends, replaces or supersedes this Agreement) shall vest and become
immediately exercisable upon the earlier of the Severance Term Date or the Equity Cessation Date,
and (y) all your vested Term Options shall remain exercisable for a period of three years after the
earlier of the Severance Term Date or the Equity Cessation Date (but not beyond the term of such
stock options); and (iii) the Company shall not be permitted to determine that your employment was
terminated for “unsatisfactory performance” within the meaning of any stock option agreement
between you and the Company. With respect to awards of restricted stock units for Time Warner
Common Stock (“RSUs”) held at the Effective Termination Date of a termination of employment
pursuant to Section 4.2, subject to potential further delay in payment pursuant to Section 11.17,
(i) if you are eligible for retirement treatment at the Effective Termination Date, then for all
awards of RSUs that contain special accelerated vesting upon retirement, the vesting of the RSUs
will accelerate upon, and the shares of Time Warner Common Stock will be paid to you promptly
following, the Effective Termination Date; and (ii) if you are not eligible for retirement
treatment at the Effective Termination Date, then the treatment of the RSUs (other than the
Make-Whole RSU grant made pursuant to Section 3.5) will be determined at the earlier of the
Severance Term Date or the Equity Cessation Date in accordance with the terms of the applicable
award agreement(s), but the shares of Time Warner Common Stock underlying any vested RSUs will not
be paid to you until promptly following the next regular vesting date(s) for such award(s) of RSUs.
With respect to the Make-Whole RSUs, if there is a termination of employment pursuant to Section
4.2 prior to their vesting, then, subject to potential further delay in payment pursuant to Section
11.17, a pro-rated portion of the Make-Whole RSU, representing the number of RSUs that would vest
through the Severance Term Date, shall vest and be paid to you promptly following the Effective
Termination Date.

12

 

          7.3 Payments in Lieu of Other Benefits. In the event the term of employment and
your employment with the Company is terminated pursuant to any section of this Agreement, you shall
not be entitled to notice and severance under the Company’s general employee policies or to be paid
for any accrued vacation time or unused sabbatical, the payments provided for in such sections
being in lieu thereof.

     7.4 Life Insurance. During your employment with the Company, the Company shall
(i) provide you with $50,000 of group life insurance and (ii) pay you annually an amount equal to
two times the premium you would have to pay to obtain life insurance under a standard group
universal life insurance program in an amount equal to $3,000,000. The Company shall pay you such
amount no later than March 15 of the calendar year following any calendar year in which you are
entitled to this amount. You shall be under no obligation to use the payments made by the Company
pursuant to the preceding sentence to purchase any additional life insurance. The payments made to
you hereunder shall not be considered as “salary” or “compensation” or “bonus” in determining the
amount of any payment under any retirement, profit-sharing or other benefit plan of the Company or
any subsidiary of the Company.

     8. Protection of Confidential Information; Non-Compete.

          8.1 Confidentiality Covenant. You acknowledge that your employment by the Company
(which, for purposes of this Section 8 shall mean Time Warner Inc. and its affiliates) will,
throughout your employment, bring you 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, trade secrets, plans for future
development, strategic plans of the most valuable nature and other business affairs and methods and
other information not readily available to the public. You further acknowledge that the services
to be performed under this Agreement are of a special, unique, unusual, extraordinary and
intellectual character. You further acknowledge that the business of the Company is global in
scope, that its products and services 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 your services, position and expertise are such

13

 

that you are capable of competing with the Company from nearly any location in the world. In
recognition of the foregoing, you covenant and agree:

               8.1.1 You shall keep secret all confidential matters of the Company and shall not disclose
such matters to anyone outside of the Company, or to anyone inside the Company who does not have a
need to know or use such information, and shall not use such information for personal benefit or
the benefit of a third party, either during or after the term of employment, except with the
Company’s written consent, provided that (i) you shall have no such obligation to the extent such
matters are or become publicly known other than as a result of your breach of your obligations
hereunder and (ii) you 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;

               8.1.2 You shall deliver promptly to the Company on termination of your employment, or at any
other time the Company may so request, all memoranda, notes, records, reports and other documents
(and all copies thereof) relating to the Company’s business, which you obtained while employed by,
or otherwise serving or acting on behalf of, the Company and which you may then possess or have
under your control; and

               8.1.3 For a period of one year after the effective date of your retirement or other
termination by you of your employment with the Company or the Effective Date of a termination of
employment pursuant to Section 4, without the prior written consent of the Company, you shall not
employ, and shall not cause any entity of which you are an affiliate to employ, any person who was
a full-time employee of the Company at the date of such termination of employment or within six
months prior thereto but such prohibition shall not apply to your secretary or executive assistant
or to any other employee eligible to receive overtime pay.

          8.2. Non-Compete Covenant.

               8.2.1 During the term of employment and for the twelve-month period after (i) the effective
date of your retirement or other termination by you of your employment or (ii) the Effective
Termination Date of a termination of employment pursuant to Section 4, you shall not, directly or
indirectly, without the prior written consent of the Chief Executive Officer of the Company: (x)
render any services to, manage,

14

 

operate, control, or act in any capacity (whether as a principal, partner, director, officer,
member, agent, employee, consultant, owner, independent contractor or otherwise and whether or not
for compensation) for, any person or entity that is a Competitive Entity, or (y) acquire any
interest of any type in any Competitive Entity, including without limitation as an owner, holder or
beneficiary of any stock, stock options or other equity interest (except as permitted by the next
sentence). Nothing herein shall prohibit you from acquiring solely as an investment and through
market purchases (i) securities of any Competitive Entity that are registered under Section 12(b)
or 12(g) of the Securities Exchange Act of 1934 (the “Exchange Act”) and that are publicly traded,
so long as you or any entity under your control are not part of any control group of such
Competitive Entity and such securities, including converted or convertible securities, do not
constitute more than one percent (1%) of the outstanding voting power of that entity and (ii)
securities of any Competitive Entity that are not registered under Section 12(b) or 12(g) of the
Exchange Act and are not publicly traded, so long as you or any entity under your control is not
part of any control group of such Competitive Entity and such securities, including converted
securities, do not constitute more than three percent (3%) of the outstanding voting power of that
entity, provided that in each case you have no active participation in the business of such entity.

               8.2.2 “Competitive Entity” shall be defined as a business (whether conducted through an entity
or by individuals including employee in self-employment) that is engaged in any business that
competes, directly or indirectly through any parent, subsidiary, affiliate, joint venture,
partnership or otherwise, with (x) any of the business activities carried on by the Company in any
geographic location where the Company conducts business (including without limitation a Competitive
Activity as defined below), (y) any business activities being planned by the Company or in the
process of development at the time of your termination of employment (as evidenced by written
proposals, market research, RFPs and similar materials) or (z) any business activity that the
Company has covenanted, in writing, not to compete with in connection with the disposition of such
a business.

          8.2.3 “Competitive Activity” refers to business activities within the lines of
business of the Company, including without limitation, the following:

	 	(a)	 	The operation of domestic and international networks and premium pay
television services (including the production, provision and/or delivery of

15

 

	 	 	 	programming to cable system operators, satellite distribution services, telephone
companies, Internet Protocol Television systems, mobile operators, broadband and
other distribution platforms and outlets) and websites and digital applications
associated with such networks and pay television services;
	 
	 	(b)	 	The sale, licensing and/or distribution of content on DVD and Blu-ray
discs, video on demand, electronic sell-through, applications for mobile devices,
the Internet or other digital services;
	 
	 	(c)	 	The production, distribution and licensing of motion pictures and
other entertainment assets, television programming, animation, interactive games
(whether distributed in physical form or digitally) and other video products and
the operation of websites and digital applications associated with the foregoing;
	 
	 	(d)	 	The publication and distribution of print and digital editions of
magazines and other publishing and publishing-related ventures, including digital
storefronts, websites and digital applications associated with such magazines and
other publishing and publishing-related ventures; direct-marketing; marketing
services businesses and book publishing.

          8.3. Injunctive Relief. Executive acknowledges that Executive’s services are of a
special, unique and extraordinary value to the Company and that Executive develops goodwill on
behalf of the Company. Because Executive’s services are unique and because Executive has access to
confidential information and strategic plans of the Company of the most valuable nature and will
help the Company develop goodwill, the parties agree that the covenants contained in this Section 8
are necessary to protect the value of the business of the Company and that a breach of any such
non-competition covenant would result in irreparable and continuing damage for which there would be
no adequate remedy at law. The parties agree therefore that in the event of a breach or threatened
breach of this Section 8, the Company may, in addition to other rights and remedies existing in its
favor, apply to any court of competent jurisdiction for specific performance and/or injunctive or
other relief in order to enforce, or prevent any violations of, the provisions hereof. The parties
further agree that in the event the Company is granted any such injunctive or other relief, the
Company shall not be required to post any

16

 

bond or security that may otherwise normally be associated with such relief.

     9. Ownership of Work Product. You acknowledge that during the term of employment,
you 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 you by reason of your employment by the Company. You
acknowledge that all of the foregoing shall be owned by and belong exclusively to the Company and
that you 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 you for the possible
interest or participation of the Company. You 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 your
inventorship or creation in any appropriate case. You agree that you will not assert any rights to
any Work Product or business opportunity as having been made or acquired by you 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.

     10. 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 a nationally recognized overnight
delivery service, 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):

17

 

          10.1 If to the Company:

Time Warner Inc.

One Time Warner Center

New York, New York 10019

Attention: Senior Vice President — Global

Compensation and Benefits

(with a copy, similarly addressed

but Attention: General Counsel)

          10.2 If to you, to your residence address set forth on the records of the Company.

     11. General.

          11.1 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.

          11.2 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.

          11.3 Entire Agreement. This Agreement, including Annexes A and B, set 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.

          11.4 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.

          11.5 Assignability. This Agreement and your rights and obligations hereunder may
not be assigned by you and except as specifically contemplated in this Agreement, neither you, your
legal representative nor any beneficiary designated by you shall have any right, without the prior
written consent of the Company, to assign,

18

 

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. The Company shall assign its rights together with its
obligations hereunder in connection with any sale, transfer or other disposition of all or
substantially all of the Company’s business and assets, whether by merger, purchase of stock or
assets or otherwise, as the case may be. Upon any such assignment, the Company shall cause any such
successor expressly to assume such obligations, and such rights and obligations shall inure to and
be binding upon any such successor.

          11.6 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.

          11.7 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 you commit a material
breach of any of the provisions of Sections 8.1, 8.2, or 9, 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.

          11.8 Resolution of Disputes. Except as provided in the preceding Section 11.7, any
dispute or controversy arising with respect to this Agreement and your employment hereunder
(whether based on contract or tort or upon any federal, state or local statute, including but not
limited to claims asserted under the Age Discrimination in Employment Act, Title VII of the Civil
Rights Act of 1964, as amended, any state Fair Employment Practices Act and/or the Americans with
Disability Act) shall, at the election of either you or the Company, be submitted to JAMS for
resolution in arbitration in accordance with the rules and procedures of JAMS. Either party shall
make such election by delivering written notice thereof to the other party at any time (but not
later than 45

19

 

days after such party receives notice of the commencement of any administrative or regulatory
proceeding 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 11.8. 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 non-judicial (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 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 is not in
business or is no longer providing arbitration services, then the American Arbitration Association
shall be substituted for JAMS for the purposes of the foregoing provisions of this Section 11.8.
If you shall be the prevailing party in such arbitration, the Company shall promptly pay, upon your
demand, all legal fees, court costs and other costs and expenses incurred by you in any legal
action seeking to enforce the award in any court.

          11.9 Beneficiaries. Whenever this Agreement provides for any payment to your
estate, such payment may be made instead to such beneficiary or beneficiaries as you may designate
by written notice to the Company. You 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.

          11.10 No Conflict. You represent and warrant to the Company that this Agreement is
legal, valid and binding upon you and the execution of this Agreement and the performance of your
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 you are a party (including, without
limitation, any other employment agreement). The Company represents and warrants to you 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

20

 

not constitute a breach of, or conflict with the terms or provisions of, any agreement or
understanding to which the Company is a party.

          11.11 Conflict of Interest. Attached as Annex B and made part of this Agreement is
the Time Warner Corporate Standards of Business Conduct. You confirm that you have read,
understand and will comply with the terms thereof and any reasonable amendments thereto. In
addition, as a condition of your employment under this Agreement, you understand that you may be
required periodically to confirm that you have read, understand and will comply with the Standards
of Business Conduct as the same may be revised from time to time.

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

          11.13 No Offset. Neither you nor the Company 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 you and the Company shall make all the
payments provided for in this Agreement in a timely manner.

          11.14 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.

          11.15 Survival. Sections 3.4, 7.3 and 8 through 11 shall survive any termination
of the term of employment by the Company for cause pursuant to Section 4.1. Sections 3.4, 4.4,
4.5, 4.6, 4.7 and 7 through 11 shall survive any termination of the term of employment pursuant to
Sections 4.2, 5 or 6. Sections 3.4, 4.6 and Sections 8 through 11 shall survive any termination of
employment due to resignation.

21

 

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

affiliate — Section 4.2.2

Average Annual Bonus — Section 4.2.1

Base Amount — Section 4.7.1

Base Salary — Section 3.1

Bonus — Section 3.2

cause — Section 4.1

Code — Section 4.5

Company — the first paragraph on page 1 and Section 8.1

Competitive Entity — Section 8.2

Disability Date — Section 5

Disability Period — Section 5

Effective Date — the first paragraph on page 1

Effective Termination Date — Section 4.1

Equity Cessation Date — Section 4.2.2

Make Whole RSUs — Section 3.5

Overpayment — Section 4.7.3

Parachute Amount — Section 4.7.1

Prior Agreements — the second paragraph on page 1

Reduced Amount — Section 4.7.1

Severance Term Date — Section 4.2.2

Term Date — Section 1

term of employment — Section 1

termination without cause — Section 4.2.1

Work Product — Section 9

          11.17 Compliance with IRC Section 409A. This Agreement is intended to comply with
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and will be interpreted
in a manner intended to comply with Section 409A of the Code. Notwithstanding anything herein to
the contrary, (i) if at the time of your termination of employment with the Company you are a
“specified employee” as defined in Section 409A of the Code (and any related regulations or other
pronouncements thereunder) and the deferral of the commencement of any payments or benefits
otherwise payable hereunder as a result of such termination of employment is necessary in order to
prevent any accelerated or additional tax under Section 409A of the Code, then the Company will
defer the commencement of the payment of any such payments or benefits hereunder (without any
reduction in such payments or benefits ultimately paid or provided to you) until the date that is
six months following your termination of employment with the Company (or the

22

 

earliest date as is permitted under Section 409A of the Code) and (ii) if any other payments of
money or other benefits due to you hereunder could cause the application of an accelerated or
additional tax under Section 409A of the Code, such payments or other benefits shall be deferred if
deferral will make such payment or other benefits compliant under Section 409A of the Code, or
otherwise such payment or other benefits shall be restructured, to the extent possible, in a
manner, determined by the Company, that does not cause such an accelerated or additional tax. To
the extent any reimbursements or in-kind benefits due to you under this Agreement constitutes
“deferred compensation” under Section 409A of the Code, any such reimbursements or in-kind benefits
shall be paid to you in a manner consistent with Treas. Reg. Section 1.409A-3(i)(1)(iv). Each
payment made under this Agreement shall be designated as a “separate payment” within the meaning of
Section 409A of the Code. References in this Agreement to your termination of active employment or
your Effective Termination Date shall be deemed to refer to the date upon which you have a
“separation from service” with the Company and its affiliates within the meaning of Section 409A of
the Code. The Company shall consult with you in good faith regarding the implementation of the
provisions of this Section 11.17; provided that neither the Company nor any of its employees or
representatives shall have any liability to you with respect to thereto.

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

	 	 	 	 	 
	 	TIME WARNER INC.

 	 
	 	By  	/s/ James Cummings
 	 
	 	 	Title:   James Cummings 	 
	 	 	SVP Compensation & Benefits 	 
	 

	 	 	 	 	 
	 	 	 
	 	     /s/ John Martin
 	 
	 	John Martin 	 
	 	 	 
	 

23

 

ANNEX A

RELEASE

This Release is made by and among                     (“You” or “Your”) and TIME WARNER INC. (the “Company”), One Time
Warner Center, New York, New York 10019 as of the date set forth below in connection with the
Employment Agreement dated                     , and effective as of                     , and the letter agreement (the “Letter Agreement”
between You and the Company dated as of                      (as so amended, the “Employment Agreement”), and in
association with the termination of your employment with the Company.

In consideration of payments made to You and other benefits to be received by You by the Company
and other benefits to be received by You pursuant to the Employment Agreement, as further reflected
in the Letter Agreement, You, being of lawful age, do hereby release and forever discharge the
Company, its successors, related companies, Affiliates, officers, directors, shareholders,
subsidiaries, agents, employees, heirs, executors, administrators, assigns, benefit plans
(including but not limited to the Time Warner Inc. Severance Pay Plan For Regular Employees),
benefit plan sponsors and benefit plan administrators of and from any and all actions, causes of
action, claims, or demands for general, special or punitive damages, attorney’s fees, expenses, or
other compensation or damages (collectively, “Claims”), whether known or unknown, which in any way
relate to or arise out of your employment with the Company or the termination of Your employment,
which You may now have under any federal, state or local law, regulation or order, including
without limitation, Claims related to any stock options held by You or granted to You by the
Company that are scheduled to vest subsequent to Your termination of employment and Claims under
the Age Discrimination in Employment Act (with the exception of Claims that may arise after the
date You sign this Release, Title VII of the Civil Rights Act of 1964, the Americans with
Disabilities Act of 1990, as amended, the Family and Medical Leave Act and the Employee Retirement
Income Security Act of 1974, as amended, through and including the date of this Release; provided,
however, that the execution of this Release shall not prevent You from bringing a lawsuit against
the Company to enforce its obligations under the Employment Agreement and this Release.

Notwithstanding anything to the contrary, nothing in this Release shall prohibit or restrict You
from (i) making any disclosure of information required by law; (ii) filing a charge with,
providing information to, or testifying or otherwise assisting in any investigation or proceeding
brought by, any federal regulatory or law enforcement agency or legislative body, any
self-regulatory organization, or the Company’s legal, compliance or human resources officers; (iii)
filing, testifying or participating in or otherwise assisting in a proceeding relating to an
alleged violation of any federal, state or municipal law relating to fraud or any rule or
regulation of the Securities and Exchange Commission or any self-regulatory organization; or (iv)
challenging the validity of my release of claims under the Age Discrimination in Employment Act.
Provided, however, You acknowledge that You cannot recover any monetary damages or equitable relief
in connection with a charge brought by You or through any action brought by a third party with
respect to the Claims

 

 

released and waived in the Agreement. Further, notwithstanding the above, You are not waiving or
releasing: (i) any claims arising after the Effective Date of this Agreement; (iii) any claims for
enforcement of this Agreement; (iii) any rights or claims You may have to workers compensation or
unemployment benefits; (iv) claims for accrued, vested benefits under any employee benefit plan of
the Company in accordance with the terms of such plans and applicable law; and/or (v) any claims or
rights which cannot be waived by law.

You further state that You have reviewed this Release, that You know and understand its contents,
and that You have executed it voluntarily.

You acknowledge that You have been given                      days to review this Release and to sign it. You also
acknowledge that by signing this Release You may be giving up valuable legal rights and that You
have been advised to consult with an attorney. You understand that You have the right to revoke
Your consent to the Release for seven days following Your signing of the Release. You further
understand that You will cease to receive any payments or benefits under this Agreement (except as
set forth in Section 4.4 of the Agreement) if You do not sign this Release or if You revoke Your
consent to the Release within seven days after signing the Release. The Release shall not become
effective or enforceable with respect to claims under the Age Discrimination Act until the
expiration of the seven-day period following Your signing of this Release. To revoke, You send a
written statement of revocation by certified mail, return receipt requested, or by hand delivery.
If You do not revoke, the Release shall become effective on the eighth day after You sign it.

Accepted and Agreed to:

__________________________

Dated: _____________________

 

 

ANNEX B

TIME WARNER CORPORATE

STANDARDS OF BUSINESS CONDUCT

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