8-KLeadership ChangesShareholder Matters

CHARTER COMMUNICATIONS, INC. /MO/ 8-K Report, Executive Changes (Apr 29, 2011)

Filed April 29, 2011For Securities:CHTR

Summary

Charter Communications, Inc. (CHTR) filed an 8-K on April 29, 2011, primarily detailing the adoption of the 2011 Long Term Incentive Plan and the results of its Annual Meeting of Stockholders held on April 26, 2011. The new incentive plan introduces time-vesting stock options, performance-vesting stock options with specific stock price thresholds, and restricted stock units (RSUs) for certain employees, including Named Executive Officers. The plan outlines detailed vesting schedules and provisions for accelerated vesting in the event of a "Change in Control" or termination without "Cause" or for "Good Reason." Key executives like Michael J. Lovett and Christopher L. Winfrey received significant grants of time-vesting and performance-vesting stock options. The annual meeting saw strong approval for the election of directors, the company's Executive Bonus Plan, and its Executive Incentive Plan. An advisory vote on executive compensation also received a "FOR" majority, and stockholders favored holding advisory votes on executive compensation every "THREE YEARS." The appointment of KPMG LLP as the independent public accounting firm was ratified with overwhelming support.

Key Highlights

  • 1Charter Communications adopted the 2011 Long Term Incentive Plan, featuring stock options and RSUs for key employees.
  • 2The plan includes time-vesting stock options with staggered vesting over four years from different commencement dates.
  • 3Performance-vesting stock options are tied to achieving specific stock price thresholds ($60, $80, $100) over defined measurement periods.
  • 4Provisions exist for accelerated vesting of options and RSUs upon a 'Change in Control' or certain employment terminations.
  • 5Key executives, including CEO Michael J. Lovett and COO Christopher L. Winfrey, received substantial option grants.
  • 6The Annual Meeting of Stockholders overwhelmingly re-elected all directors and approved key compensation plans.
  • 7Stockholders voted in favor of holding future advisory votes on executive compensation every three years.

Frequently Asked Questions

The 2011 Long Term Incentive Plan was adopted to incentivize and retain certain employees, including Named Executive Officers, by providing them with equity-based compensation in the form of stock options (both time-vesting and performance-vesting) and restricted stock units (RSUs).

Performance-vesting stock options vest based on the achievement of specific stock price thresholds ($60, $80, $100 per share) measured over defined periods, with vesting occurring in three tranches. These performance conditions are subject to continued employment and specific measurement standards (Tranche I, II, and III).

In the event of a 'Change in Control,' unvested time-vesting options and RSUs may vest immediately under certain conditions (e.g., termination without 'Cause' or for 'Good Reason'). Performance-vesting options' vesting depends on the transaction price and specific award agreement terms. Upon termination without 'Cause' or for 'Good Reason,' unvested awards generally vest on a pro-rata basis, with some exceptions for 'Non-Eligible' awards.

Yes, the Annual Meeting held on April 26, 2011, saw strong shareholder support for the election of all directors, the approval of the Executive Bonus Plan and Executive Incentive Plan, and an advisory vote on executive compensation. Shareholders also indicated a preference for holding advisory votes on executive compensation every three years.