Employment Agreement with Olaf Olafsson – Time Warner

EMPLOYMENT AGREEMENT (“Agreement”) made effective as of August 1, 2008
(the “Effective Date”), between TIME WARNER INC., a Delaware corporation (the
“Company”), and OLAF OLAFSSON (“You”). You are currently employed by the
Company pursuant to an Employment Agreement made and effective on May 19, 2005
(the “Prior Agreement”). This Agreement amends and supersedes the Prior
Agreement in all respects effective the Effective Date, and you and the Company
desire to set forth the terms and conditions of your employment by the Company
and 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 July 31, 2011 (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
Executive Vice President, International and Corporate Strategy of the Company
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 Chief Executive Officer or such other executive officer of the Company as
the Company shall determine, provided that you consent to such other reporting
assignment (to whom you shall directly report). 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 the Chief Executive Officer or other
officer of the Company, no outside business activities which require the
devotion of substantial amounts of your time, and (iii) 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 $750,000 per annum
during the term of employment (“Base Salary”). The Company may increase, but not
decrease, 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 100%.
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. Although as a general matter the Company expects to pay
bonuses at the target level in cases of satisfactory individual performance, it
does not commit to do so, and your Bonus may be negatively affected by the
exercise of the Company’s discretion or by overall Company 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
$1,500,000 (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 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 contained on the date hereof 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).

---

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) fraud, misappropriation, embezzlement or reckless or willful
destruction of Company property, (d) material 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) material breach of any of the covenants provided for in Section 9 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 30 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. 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 lines, 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 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 (the “Severance Term Date”). 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 of your termination without cause) 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 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 8.2
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 8.2 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 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. 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, as
such form may be updated in the discretion of the Company. If you shall fail to
execute and deliver such release, or if you revoke such release as provided
therein, then in lieu of 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. 4.5 Mitigation. In the
event of a termination without cause under 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 12.17. 4.7
Limitation on Certain Payments. Notwithstanding any other provision of
this Agreement: 4.7.1. In the event that part or all of the
consideration, compensation or benefits to be paid to you under this Agreement
would 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, 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 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.

---

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 12.17. 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 12.17. 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 9 and 10
during the Disability Period. The advisory services referred to in clause (i) of
the immediately preceding sentence shall consist of rendering advice concerning
the business, affairs and management of the Company as requested by the Chief
Executive Officer or 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. 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 the Group Universal
Life (“GUL”) insurance program made available by the Company 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 GUL insurance or to
purchase any other life insurance. If the Company discontinues its GUL insurance
program, the Company shall nevertheless make the payments required by this
Section 7 as if such program were still in effect. 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 pension, retirement,
profit-sharing or other benefit plan of the Company or any subsidiary of the
Company. 8. Other Benefits. 8.1 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 and so long as you are an employee of 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. 8.2 Benefits After a Termination or
Disability. After the Effective Termination Date of a termination 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 Prior Agreement, notwithstanding the foregoing or any more
restrictive provisions of any such plan or agreement, if your employment with
the Company is 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 January 1, 2005 (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); (iii) in accordance with the terms of the letter agreement
dated December 18, 2001 between you and the Company, the vested stock options
granted to you on or prior to April 6, 2001 shall remain exercisable for a
period of three years after the Severance Term Date or the Equity Cessation Date
(but not beyond the term of such options); (iv) all stock options granted to you
after April 6, 2001 and before January 1, 2005 shall be governed by the terms of
the applicable stock option plan and agreement under which such options were
awarded and (v) 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 (“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 12.17, (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 date of the
termination of employment, then the

---

treatment of the RSUs 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. 8.3 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.
9. Protection of Confidential Information; Non-Compete.
9.1 Confidentiality Covenant. You acknowledge that your
employment by the Company (which, for purposes of this Section 9 shall mean Time
Warner Inc. and its affiliates) will, throughout the term of employment, bring
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 and other business
affairs and methods and other information not readily available to the public,
and plans for future development. 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 international 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 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: 9.1.1 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; 9.1.2 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 9.1.3 If the
term of employment is terminated pursuant to Section 4, for a period of one year
after the Effective Termination Date, 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 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. 9.2
Non-Compete. During the term of employment and for a period of twelve
months after (i) the effective date of your retirement or other voluntary
termination of 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 or
a Chief Operating Officer of the Company, render any services to, or act in any
capacity for, any Competitive Entity, or acquire any interest of any type in any
Competitive Entity; provided, however, that the foregoing shall not be deemed to
prohibit you from acquiring, (a) solely as an investment and through market
purchases, securities of any Competitive Entity which are registered under
Section 12(b) or 12(g) of the Securities Exchange Act of 1934 and which are
publicly traded, so long as you are not part of any control group of such
Competitive Entity and such securities, including converted securities, do not
constitute more than one percent (1%) of the outstanding voting power of that
entity and (b) securities of any Competitive Entity that are not publicly
traded, so long as you are 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. For
purposes

---

of the foregoing, the following shall be deemed to be a Competitive Entity:
(x) during the period that you are actively employed with the Company, during
the Disability Period, or prior to the Effective Termination Date in the event
your employment is terminated pursuant to Section 4, any person or entity that
engages in any line of business that is substantially the same as either (i) any
line of business which the Company engages in, conducts or, to your knowledge,
has definitive plans to engage in or conduct or (ii) any operating business that
is engaged in or conducted by the Company as to which, to your knowledge, the
Company covenants, in writing, not to compete with in connection with the
disposition of such business, and (y) after the Disability Period, the Effective
Termination Date in the event of a termination of your term of employment
pursuant to Section 4 or the effective date of your retirement or other
voluntary termination of employment, any of the following: AT&T Corporation,
Bertelsmann A.G., CBS Corporation, Comcast Corporation, The Walt Disney Company,
General Electric Corporation, Google Inc., Microsoft Corporation, The News
Corporation Ltd., Sony Corporation, Viacom Inc. and Yahoo! Inc., and their
respective subsidiaries and affiliates and any successor to the internet service
provider, media or entertainment businesses thereof. 10. 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. The Company hereby agrees that you shall
have all rights and interests in any fictional or non-fictional literary work
(including books and plays) written by you during your personal time, it being
understood, however, that the foregoing shall not include any literary or other
Work Product written or created by you in connection with or relating to the
performance of your duties hereunder. 11. Notices. All notices,
requests, consents and other communications required or permitted to be given
under this Agreement shall be effective only if given in writing and shall be
deemed to have been duly given if delivered personally or sent by 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): 11.1 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) 11.2 If to you, to your residence
address set forth on the records of the Company, with a copy to: David E.
Alexander
Peyser & Alexander Management, Inc.
500 Fifth Avenue, Suite 2700
New York, NY 10110. 12. General. 12.1 Governing
Law. This Agreement shall be governed by and construed and enforced in
accordance with the substantive laws of the State of New York applicable to
agreements made and to be performed entirely in New York.

---

12.2 Captions. The section headings contained herein are for
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement. 12.3 Entire Agreement. This
Agreement, including Annexes A and B, 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. 12.4 No Other Representations. No
representation, promise or inducement has been made by either party that is not
embodied in this Agreement, and neither party shall be bound by or be liable for
any alleged representation, promise or inducement not so set forth.
12.5 Assignability. This Agreement and 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, 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. 12.6 Amendments; Waivers.
This Agreement may be amended, modified, superseded, cancelled, renewed or
extended and the terms or covenants hereof may be waived only by written
instrument executed by both of the parties hereto, or in the case of a waiver,
by the party waiving compliance. The failure of either party at any time or
times to require performance of any provision hereof shall in no manner affect
such party’s right at a later time to enforce the same. No waiver by either
party of the breach of any term or covenant contained in this Agreement, in any
one or more instances, shall be

---

deemed to be, or construed as, a further or continuing waiver of any such
breach, or a waiver of the breach of any other term or covenant contained in
this Agreement. 12.7 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 9.1, 9.2 or 10, 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. 12.8
Resolution of Disputes. Except as provided in the preceding Section 12.7,
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/ENDISPUTE for resolution in arbitration in accordance with the
rules and procedures of JAMS/ENDISPUTE. Either party shall make such election by
delivering written notice thereof to the other party at any time (but not later
than 45 days after such party receives notice of the commencement of any
administrative or regulatory 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 12.8.
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/ENDISPUTE shall be final and binding.
Judgment upon the award rendered by such arbitrator may be entered in any court
having jurisdiction thereof, and the parties consent to the jurisdiction of the
New York courts for this purpose. The prevailing party shall be entitled to
recover the costs of arbitration (including reasonable attorneys fees and the
fees of experts) from the losing party. If at the time any dispute or
controversy arises with respect to this Agreement, JAMS/ENDISPUTE is not in
business or is no longer providing arbitration services, then the American
Arbitration Association shall be

---

substituted for JAMS/ENDISPUTE for the purposes of the foregoing provisions
of this Section 12.8. 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. 12.9 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.
12.10 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 not constitute a breach of, or conflict with the
terms or provisions of, any agreement or understanding to which the Company is a
party. 12.11 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.
12.12 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. 12.13 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. 12.14 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. 12.15 Survival. Sections 3.4, 8.3
and 9 through 12 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
8 through 12 shall survive any termination of the term of employment pursuant to
Sections 4.2, 5 or 6. 12.16 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 9.1
Competitive Entity : Section 9.2
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
Overpayment : Section 4.7.3
Parachute Amount : Section 4.7.1
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 10 12.17 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 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. The Company shall consult with you in good faith regarding the
implementation of the provisions of this Section 12.17; 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/ Mark A. Wainger
		/s/ Olaf Olafsson
		Olaf Olafsson

---

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 AOL 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 am 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 from the date You received a copy of the
Release 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 my consent to the
Release for seven days following my signing of the Release. You further
understand that You will not receive any payments or benefits under this
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. You shall not receive any payments or benefits pursuant
to this Agreement until the Release becomes effective. 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: