Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

THIS AGREEMENT (the “Agreement”) is made as of the 28th day of May, 2004, by and
between NTL Incorporated, a Delaware corporation (the “Company”), and Bryan H.
Hall (the “Executive”).

 

WHEREAS, the Company wishes to employ the Executive as General Counsel of the
Company, effective as of June 15, 2004 (the “Effective Date”);

 

WHEREAS the parties intend that (i) the Executive will reside in the United
Kingdom and perform duties on behalf of the consolidated enterprise as its
General Counsel while present in the United Kingdom, particularly with regard to
the UK business, and (ii) he will travel to the United States where he will
perform duties on behalf of the Company as its General Counsel, in each case
upon the terms and conditions of this Agreement; and

 

WHEREAS, the Executive wishes to accept such employment and to render services
to the Company on the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the
parties hereto agree as follows:

 

1.                                       EFFECTIVENESS.  THIS AGREEMENT SHALL
BECOME EFFECTIVE AS OF THE EFFECTIVE DATE.

 

2.                                       EMPLOYMENT TERM.

 

(A)                                  THE TERM OF THE EXECUTIVE’S EMPLOYMENT
PURSUANT TO THIS AGREEMENT (THE “EMPLOYMENT TERM”) SHALL COMMENCE AS OF THE
EFFECTIVE DATE AND SHALL END ON DECEMBER 31, 2006, UNLESS THE EMPLOYMENT TERM
TERMINATES EARLIER PURSUANT TO

 

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SECTION 7 OF THIS AGREEMENT.  THE EMPLOYMENT TERM MAY BE EXTENDED BY MUTUAL
AGREEMENT OF THE COMPANY AND THE EXECUTIVE.

 

(B)                                 TITLE; DUTIES.  DURING THE EMPLOYMENT TERM,
THE EXECUTIVE SHALL SERVE THE COMPANY AS ITS GENERAL COUNSEL AND, IN SUCH
CAPACITY, SHALL PERFORM SUCH DUTIES, SERVICES AND RESPONSIBILITIES AS ARE
COMMENSURATE WITH SUCH POSITION.  IN HIS CAPACITY AS GENERAL COUNSEL, THE
EXECUTIVE SHALL REPORT TO THE CHIEF EXECUTIVE OFFICER OF THE COMPANY.  DURING
THE EMPLOYMENT TERM, THE EXECUTIVE SHALL BE BASED IN THE UNITED KINGDOM BUT
SHALL UNDERTAKE SUCH OVERSEAS TRAVEL AS IS NECESSARY FOR THE PROPER PERFORMANCE
OF HIS DUTIES HEREUNDER.

 

During the Employment Term, the Executive shall devote substantially all of his
time to the performance of the Executive’s duties hereunder and will not,
without the prior written approval of the Chief Executive Officer of the
Company, engage in any other business activity which interferes in any material
respect with the performance of the Executive’s duties hereunder or which is in
violation of written policies established from time to time by the Company. 
Nothing contained in this Agreement shall preclude the Executive from devoting a
reasonable amount of time and attention during the Employment Term to (A)
continuing legal education, including, without limitation, any and all
continuing legal education efforts as may be required to remain in good standing
with the bar of the State of New York (which may include attendance at seminars
and other similar events) and (B) (i) serving, with the prior approval of the
Board of Directors of the Company (the “Board”), as a non-executive director,
trustee or member of a committee of any for-profit organizations;

 

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(ii) engaging in charitable and community activities (including pro bono legal
services); and (iii) managing personal and family investments and affairs, so
long as any activities of the Executive which are within the scope of clauses
(A) and (B) (i), (ii) and (iii) of this Section 2(b) do not interfere in any
material respect with the performance of the Executive’s duties hereunder.

 

3.                                       MONETARY REMUNERATION.

 

(A)                                  BASE SALARY.  DURING THE EMPLOYMENT TERM,
IN CONSIDERATION OF THE PERFORMANCE BY THE EXECUTIVE OF THE EXECUTIVE’S
OBLIGATIONS HEREUNDER TO THE COMPANY AND ITS PARENTS, SUBSIDIARIES, ASSOCIATED
AND AFFILIATED COMPANIES AND JOINT VENTURES (COLLECTIVELY, THE “COMPANY
AFFILIATED GROUP”) IN ANY CAPACITY (INCLUDING ANY SERVICES AS AN OFFICER,
DIRECTOR, EMPLOYEE, MEMBER OF ANY BOARD COMMITTEE OR MANAGEMENT COMMITTEE OR
OTHERWISE), THE COMPANY SHALL CAUSE TO BE PAID TO THE EXECUTIVE AN ANNUAL SALARY
OF £300,000 (THE “BASE SALARY”), WHICH SHALL ACCRUE ON A DAILY BASIS.  THE BASE
SALARY SHALL BE PAYABLE IN ACCORDANCE WITH NORMAL PAYROLL PRACTICES IN EFFECT
FROM TIME TO TIME FOR SENIOR MANAGEMENT GENERALLY; PROVIDED THAT THE EXECUTIVE
MAY DESIGNATE AT ONE TIME EACH YEAR A PERCENTAGE OF CASH COMPENSATION, NOT YET
PAID, TO BE PAID IN U.S. DOLLARS, WITH THE EXCHANGE RATE SET ON THE DATE THAT
SUCH DESIGNATION IS MADE BY REFERENCE TO THE NOON BUYING RATE AS QUOTED BY THE
FEDERAL RESERVE BANK OF NEW YORK.  THE EXECUTIVE SHALL RECEIVE NO ADDITIONAL
COMPENSATION FOR SERVICES THAT HE PROVIDES TO THE COMPANY AFFILIATED GROUP OTHER
THAN AS SET FORTH HEREIN.

 

(B)                                 ANNUAL CASH BONUS.  DURING EACH FISCAL YEAR
OF THE COMPANY THAT THE EMPLOYMENT TERM IS IN EFFECT, THE EXECUTIVE SHALL BE
ELIGIBLE TO EARN A CASH BONUS IN

 

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THE SOLE DISCRETION OF THE BOARD OF (AT TARGET) 75%, BUT SUBJECT TO A MAXIMUM OF
150%, OF BASE SALARY (PRORATED FOR ANY PARTIAL FISCAL YEAR) (THE “ANNUAL CASH
BONUS”).  IN ADDITION, THE COMPANY SHALL CAUSE THE EXECUTIVE TO PARTICIPATE IN
THE NTL GROUP LONG TERM INCENTIVE PLAN.

 

(C)                                  EXPATRIATE PACKAGE.  DURING THE EMPLOYMENT
TERM AND FOR ANY PERIOD DURING WHICH THE EXECUTIVE IS REQUIRED BY THE COMPANY TO
LIVE IN THE UNITED KINGDOM, THE EXECUTIVE AND HIS FAMILY SHALL HAVE THE RIGHT TO
RECEIVE THE BENEFITS OF THE COMPANY’S STANDARD EXPATRIATE BENEFITS PACKAGE (AS
APPLIED TO COMPARABLE UNITED STATES EXPATRIATE EMPLOYEES OF THE COMPANY), BUT IN
ANY EVENT SUCH BENEFITS WILL BE CONSISTENT WITH THE TERMS SET FORTH IN APPENDIX
A HERETO.  TAX EQUALIZATION SHALL BE CONSISTENT WITH EXISTING COMPANY TAX
EQUALIZATION POLICY, ATTACHED AS APPENDIX B HERETO, AND INCORPORATED BY
REFERENCE.

 

4.                                       EQUITY-BASED COMPENSATION.

 

DURING THE EMPLOYMENT TERM, THE EXECUTIVE SHALL BE ELIGIBLE TO RECEIVE OPTIONS
TO PURCHASE COMMON STOCK OF THE COMPANY IN ADDITION TO THE OPTIONS DESCRIBED IN
APPENDIX C AT SUCH EXERCISE PRICES, SCHEDULES AS TO EXERCISABILITY AND OTHER
TERMS AND CONDITIONS AS DETERMINED IN THE SOLE DISCRETION OF THE BOARD OR ITS
COMPENSATION COMMITTEE UNDER THE AMENDED AND RESTATED NTL 2004 STOCK INCENTIVE
PLAN OR SUCCESSOR PLAN.

 

5.                                       BENEFITS.

 

(A)                                  DURING THE EMPLOYMENT TERM, THE EXECUTIVE
SHALL BE ENTITLED TO PARTICIPATE IN ALL OF THE EMPLOYEE BENEFIT PLANS, PROGRAMS,
POLICIES AND ARRANGEMENTS

 

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(INCLUDING FRINGE BENEFIT AND EXECUTIVE PERQUISITE PROGRAMS AND POLICIES) MADE
AVAILABLE BY THE COMPANY AFFILIATE GROUP TO, OR FOR THE BENEFIT OF, ITS
EXECUTIVE OFFICERS IN ACCORDANCE WITH THE TERMS THEREOF AS THEY MAY BE IN EFFECT
FROM TIME TO TIME, IN SO FAR AS SUCH BENEFITS ARE CAPABLE OF BEING PROVIDED IN
THE UNITED KINGDOM.

 

(B)                                 REIMBURSEMENT OF EXPENSES.  DURING THE
EMPLOYMENT TERM, THE COMPANY SHALL CAUSE THE EXECUTIVE TO BE REIMBURSED FOR ALL
REASONABLE BUSINESS EXPENSES INCURRED BY THE EXECUTIVE IN CARRYING OUT THE
EXECUTIVE’S DUTIES, SERVICES AND RESPONSIBILITIES UNDER THIS AGREEMENT, AND
REASONABLE EXPENSES INCURRED IN CONNECTION WITH MAINTAINING ADMISSION TO
PRACTICE IN THE STATE OF NEW YORK, SO LONG AS THE EXECUTIVE COMPLIES WITH THE
GENERAL PROCEDURES OF THE COMPANY AFFILIATED GROUP FOR SUBMISSION OF EXPENSE
REPORTS, RECEIPTS OR SIMILAR DOCUMENTATION OF SUCH EXPENSES APPLICABLE TO SENIOR
MANAGEMENT GENERALLY.

 

6.                                       VACATIONS.  FOR EACH WHOLE AND PARTIAL
CALENDAR YEAR DURING THE EMPLOYMENT TERM, THE EXECUTIVE SHALL BE ENTITLED IN
ADDITION TO PUBLIC AND STATUTORY HOLIDAYS TO 25 DAYS OF PAID VACATION (PRORATED
FOR ANY PARTIAL CALENDAR YEAR, EXCEPT THAT FOR CALENDAR YEAR 2004, THE VACATION
ENTITLEMENT SHALL BE 15 DAYS), TO BE CREDITED AND TAKEN IN ACCORDANCE WITH THE
COMPANY’S POLICY AS IN EFFECT FROM TIME TO TIME FOR ITS SIMILARLY SITUATED
EXECUTIVES.

 

7.                                       TERMINATION; SEVERANCE.

 

(A)                                  TERMINATION OF EMPLOYMENT.  THE COMPANY MAY
TERMINATE THE EMPLOYMENT OF THE EXECUTIVE IN A TERMINATION WITHOUT CAUSE UPON 30
DAYS’ WRITTEN NOTICE TO THE EXECUTIVE.  THE COMPANY MAY (AT ITS DISCRETION) AT
ANY TIME FOLLOWING THE

 

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GIVING OF SUCH NOTICE (BUT NOT EXCEEDING THE LENGTH OF THE NOTICE GIVEN) CEASE
TO PROVIDE WORK FOR THE EXECUTIVE IN WHICH EVENT DURING SUCH NOTICE PERIOD THE
OTHER PROVISIONS OF THIS AGREEMENT SHALL CONTINUE TO HAVE FULL FORCE AND EFFECT
BUT THE EXECUTIVE SHALL NOT BE ENTITLED TO ACCESS TO ANY PREMISES OF THE COMPANY
OR ANY MEMBER OF THE COMPANY AFFILIATED GROUP.  IN ADDITION, THE EMPLOYMENT OF
THE EXECUTIVE SHALL AUTOMATICALLY TERMINATE AS OF THE DATE ON WHICH THE
EXECUTIVE DIES OR IS DISABLED.  FOR THE PURPOSES OF THIS AGREEMENT, THE
EXECUTIVE SHALL BE “DISABLED” AS OF ANY DATE IF, AS OF SUCH DATE, THE EXECUTIVE
HAS BEEN UNABLE, DUE TO PHYSICAL OR MENTAL INCAPACITY, TO SUBSTANTIALLY PERFORM
THE EXECUTIVE’S DUTIES, SERVICES AND RESPONSIBILITIES HEREUNDER EITHER FOR A
PERIOD OF AT LEAST 180 CONSECUTIVE DAYS OR FOR AT LEAST 270 DAYS IN ANY
CONSECUTIVE 365-DAY PERIOD, WHICHEVER MAY BE APPLICABLE.  UPON TERMINATION OF
THE EXECUTIVE’S EMPLOYMENT DURING THE EMPLOYMENT TERM BECAUSE THE EXECUTIVE DIES
OR IS DISABLED, THE COMPANY SHALL CAUSE THE EXECUTIVE (OR THE EXECUTIVE’S
ESTATE, IF APPLICABLE) TO BE PROVIDED WITH DEATH OR DISABILITY BENEFITS (AS
APPLICABLE) PURSUANT TO THE PLANS, PROGRAMS, POLICIES AND ARRANGEMENTS OF THE
COMPANY AFFILIATED GROUP AS ARE THEN IN EFFECT WITH RESPECT TO EXECUTIVE
OFFICERS.  IN ADDITION, UPON ANY TERMINATION OF THE EXECUTIVE’S EMPLOYMENT
DURING THE EMPLOYMENT TERM, THE COMPANY SHALL CAUSE THE EXECUTIVE TO BE PAID ANY
EARNED BUT UNPAID PORTION OF THE BASE SALARY AND ANNUAL CASH BONUS.  IMMEDIATELY
FOLLOWING TERMINATION OF THE EXECUTIVE’S EMPLOYMENT FOR ANY REASON, THE
EMPLOYMENT TERM SHALL TERMINATE.

 

(B)                                 TERMINATION WITHOUT CAUSE; CONSTRUCTIVE
TERMINATION WITHOUT CAUSE.  UPON A TERMINATION WITHOUT CAUSE OR A CONSTRUCTIVE
TERMINATION WITHOUT

 

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CAUSE, THE COMPANY SHALL, AS SOON AS PRACTICABLE FOLLOWING THE EXECUTIVE’S
EXECUTION AND DELIVERY TO THE COMPANY OF THE GENERAL RELEASE OF CLAIMS SET FORTH
IN SECTION 7(F) AND, FOLLOWING THE EXPIRATION OF ANY APPLICABLE REVOCATION
PERIOD, CAUSE THE EXECUTIVE TO BE PAID A LUMP-SUM SEVERANCE PAYMENT OF CASH
EQUAL TO THE PRODUCT OF THE BASE SALARY TIMES 3.

 

(C)                                  TERMINATION UPON NON-RENEWAL OF THE
EMPLOYMENT TERM.  UNLESS THE PARTIES HERETO AGREE OTHERWISE, THE EMPLOYMENT TERM
AND THE EXECUTIVE’S EMPLOYMENT WITH THE COMPANY SHALL END ON DECEMBER 31, 2006. 
IN CONNECTION WITH SUCH TERMINATION OF EMPLOYMENT, THE COMPANY SHALL, AS SOON AS
PRACTICABLE FOLLOWING THE EXECUTIVE’S EXECUTION AND DELIVERY TO THE COMPANY OF
THE GENERAL RELEASE SET FORTH IN SECTION 7(F) AND FOLLOWING THE EXPIRATION OF
ANY APPLICABLE REVOCATION PERIOD, CAUSE THE EXECUTIVE TO BE PAID A LUMP-SUM
SEVERANCE PAYMENT OF CASH EQUAL TO ONE-HALF OF THE BASE SALARY.  IN THE EVENT
THAT THE EXECUTIVE HAS NOT OBTAINED SUBSEQUENT EMPLOYMENT (AS A COMMON-LAW
EMPLOYEE, AS AN INDEPENDENT CONTRACTOR OR IN ANY OTHER CAPACITY) BY THE END OF
THE SIX-MONTH PERIOD FOLLOWING THE DATE OF TERMINATION PURSUANT TO THIS
SECTION 7(C), THEN, DURING EACH OF THE SIX CALENDAR MONTHS AFTER SUCH SIX-MONTH
PERIOD, THE COMPANY SHALL CAUSE THE EXECUTIVE TO BE PAID ADDITIONAL SEVERANCE
PAY EQUAL TO ONE-TWELFTH OF THE BASE SALARY; PROVIDED, THAT THE RIGHT TO
ADDITIONAL SEVERANCE PAY PURSUANT TO THIS SENTENCE SHALL TERMINATE AS TO ANY
UNPAID PORTION OF SUCH SEVERANCE PAY WHEN THE EXECUTIVE FIRST OBTAINS ANY SUCH
SUBSEQUENT EMPLOYMENT.  IN ADDITION, IN CONNECTION WITH A TERMINATION OF
EMPLOYMENT PURSUANT TO THIS SECTION 7(C), THE COMPANY SHALL CAUSE THE EXECUTIVE
TO BE PAID A FULL ANNUAL BONUS FOR THE COMPANY’S 2006 FISCAL YEAR, DETERMINED
BASED ON

 

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ACTUAL SATISFACTION OF ANY APPLICABLE PERFORMANCE GOALS DURING SUCH FISCAL YEAR,
WITH SUCH BONUS TO BE PAID PROMPTLY AFTER THE DETERMINATION OF THE AMOUNT
THEREOF AND WITHOUT APPLICATION OF ANY MANDATORY DEFERRAL PROVISIONS OR
CONTINUED EMPLOYMENT REQUIREMENTS.

 

(D)                                 UPON A TERMINATION OF THE EXECUTIVE’S
EMPLOYMENT DURING THE EMPLOYMENT TERM BY THE COMPANY FOR CAUSE, OR UPON
TERMINATION BY THE EXECUTIVE WITH 30 DAYS’ WRITTEN NOTICE GIVEN TO THE COMPANY
(OTHER THAN A CONSTRUCTIVE TERMINATION WITHOUT CAUSE), THE EXECUTIVE SHALL BE
ENTITLED TO EARNED BUT UNPAID BASE SALARY AND BENEFITS THROUGH THE DATE OF
TERMINATION, AND THE EXECUTIVE SHALL NOT BE ENTITLED TO ANY OTHER PAYMENTS OR
BENEFITS.

 

(E)                                  UPON ANY TERMINATION OF THE EXECUTIVE’S
EMPLOYMENT DURING THE EMPLOYMENT TERM OTHER THAN BY THE COMPANY FOR CAUSE, THE
EXECUTIVE AND HIS FAMILY SHALL BE ENTITLED TO CONTINUED MEDICAL BENEFITS UNDER
(AND IN ACCORDANCE WITH THE TERMS OF) THE COMPANY’S BENEFIT PLANS FOR 1 YEAR
FROM THE DATE OF TERMINATION.

 

For purposes of this Agreement:

 

(I)                                     A “CONSTRUCTIVE TERMINATION WITHOUT
CAUSE” MEANS A TERMINATION OF THE EXECUTIVE’S EMPLOYMENT DURING THE EMPLOYMENT
TERM BY THE EXECUTIVE FOLLOWING THE OCCURRENCE OF ANY OF THE FOLLOWING EVENTS
WITHOUT THE EXECUTIVE’S PRIOR CONSENT: (A) FAILURE BY THE COMPANY TO CONTINUE
THE EXECUTIVE AS THE GENERAL COUNSEL (EXCLUDING A PROMOTION); (B) ANY MATERIAL
DIMINUTION IN THE EXECUTIVE’S WORKING CONDITIONS OR AUTHORITY, RESPONSIBILITIES
OR AUTHORITIES; (C) ASSIGNMENT TO THE EXECUTIVE OF DUTIES THAT ARE INCONSISTENT,
IN A MATERIAL RESPECT, WITH THE SCOPE OF DUTIES AND RESPONSIBILITIES ASSOCIATED
WITH HIS POSITION AS SET FORTH HEREIN; (D) ANY MATERIALLY

 

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ADVERSE CHANGE IN THE REPORTING STRUCTURE APPLICABLE TO THE EXECUTIVE (BUT NOT
INCLUDING A CHANGE IN THE PERSON FILLING THE POSITION TO WHICH THE EXECUTIVE
REPORTS); (E) THE FAILURE OF THE COMPANY TO MAINTAIN COMMERCIALLY REASONABLE
DIRECTORS’ AND OFFICERS’ LIABILITY INSURANCE; OR (F) A CHANGE IN CONTROL OCCURS
AND THE EXECUTIVE IS TERMINATED IN A TERMINATION WITHOUT CAUSE DURING THE PERIOD
COMMENCING ON THE DATE OF THE CHANGE IN CONTROL AND ENDING ON THE FIRST
ANNIVERSARY THEREOF.  FOR PURPOSES OF THIS AGREEMENT, A “CHANGE IN CONTROL” IS
DEFINED IN APPENDIX D ATTACHED HERETO, AND INCORPORATED BY REFERENCE.  THE
EXECUTIVE SHALL GIVE THE COMPANY 10 DAYS’ NOTICE OF THE EXECUTIVE’S INTENTION TO
TERMINATE THE EXECUTIVE’S EMPLOYMENT AND CLAIM THAT A CONSTRUCTIVE TERMINATION
WITHOUT CAUSE (AS DEFINED IN (A), (B), (C), (D), (E) OR (F) ABOVE) HAS OCCURRED,
AND SUCH NOTICE SHALL DESCRIBE THE FACTS AND CIRCUMSTANCES IN SUPPORT OF SUCH
CLAIM IN REASONABLE DETAIL.  THE COMPANY SHALL HAVE 10 DAYS THEREAFTER TO CURE
SUCH FACTS AND CIRCUMSTANCES IF POSSIBLE.

 

(II)                                  A “TERMINATION WITHOUT CAUSE” MEANS A
TERMINATION OF THE EXECUTIVE’S EMPLOYMENT DURING THE EMPLOYMENT TERM BY THE
COMPANY OTHER THAN FOR CAUSE.

 

(III)                               “CAUSE” MEANS (X) THE EXECUTIVE IS CONVICTED
OF, OR PLEADS GUILTY OR NOLO CONTENDERE TO, A FELONY OR TO ANY CRIME INVOLVING
FRAUD, EMBEZZLEMENT OR BREACH OF TRUST; (Y) THE WILLFUL OR CONTINUED FAILURE OF
THE EXECUTIVE TO PERFORM THE EXECUTIVE’S DUTIES HEREUNDER (OTHER THAN AS A
RESULT OF PHYSICAL OR MENTAL ILLNESS); OR (Z) IN CARRYING OUT THE EXECUTIVE’S
DUTIES HEREUNDER, THE EXECUTIVE HAS ENGAGED IN CONDUCT THAT CONSTITUTES GROSS
NEGLECT OR WILLFUL MISCONDUCT, UNLESS THE EXECUTIVE BELIEVED IN

 

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GOOD FAITH THAT SUCH CONDUCT WAS IN, OR NOT OPPOSED TO, THE BEST INTERESTS OF
THE COMPANY AND EACH MEMBER OF THE COMPANY AFFILIATED GROUP.  THE COMPANY SHALL
GIVE THE EXECUTIVE 10 DAYS’ NOTICE OF THE COMPANY’S INTENTION TO TERMINATE THE
EXECUTIVE’S EMPLOYMENT AND CLAIM THAT FACTS AND CIRCUMSTANCES CONSTITUTING CAUSE
EXIST, AND SUCH NOTICE SHALL DESCRIBE THE FACTS AND CIRCUMSTANCES IN SUPPORT OF
SUCH CLAIM.  THE EXECUTIVE SHALL HAVE 10 DAYS THEREAFTER TO CURE SUCH FACTS AND
CIRCUMSTANCES IF POSSIBLE.  IF THE BOARD REASONABLY CONCLUDES THAT THE EXECUTIVE
HAS NOT CURED SUCH FACTS OR CIRCUMSTANCES WITHIN SUCH TIME, CAUSE SHALL NOT BE
DEEMED TO HAVE BEEN ESTABLISHED UNLESS AND UNTIL THE EXECUTIVE HAS RECEIVED A
HEARING BEFORE THE BOARD (IF PROMPTLY REQUESTED BY THE EXECUTIVE) AND A MAJORITY
OF THE BOARD WITHIN 10 DAYS OF THE DATE OF SUCH HEARING (IF SO REQUESTED)
REASONABLY CONFIRMS THE EXISTENCE OF CAUSE AND THE TERMINATION OF THE EXECUTIVE
THEREFOR.

 

(F)                                    RELEASE; FULL SATISFACTION. 
NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT, NO SEVERANCE PAY SHALL
BECOME PAYABLE UNDER THIS AGREEMENT UNLESS AND UNTIL THE EXECUTIVE AND THE
COMPANY EXECUTE THE GENERAL RELEASE OF CLAIMS IN FORM ATTACHED AS APPENDIX E,
INCLUDING WHERE RELEVANT A RELEASE OF ANY STATUTORY CLAIMS, AND SUCH RELEASE HAS
BECOME IRREVOCABLE; PROVIDED, THAT THE EXECUTIVE SHALL NOT BE REQUIRED TO
RELEASE ANY INDEMNIFICATION RIGHTS, RIGHTS TO BENEFITS, AND ANY ACCRUED RIGHTS
UNDER THIS AGREEMENT.  THE PAYMENTS TO BE PROVIDED TO THE EXECUTIVE PURSUANT TO
THIS SECTION 7 UPON TERMINATION OF THE EXECUTIVE’S EMPLOYMENT SHALL CONSTITUTE
THE EXCLUSIVE PAYMENTS IN THE NATURE OF SEVERANCE OR TERMINATION PAY OR SALARY
CONTINUATION WHICH SHALL BE DUE TO THE EXECUTIVE UPON A TERMINATION OF
EMPLOYMENT AND SHALL BE IN LIEU OF ANY OTHER SUCH

 

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PAYMENTS UNDER ANY SEVERANCE OR TERMINATION PLAN, PROGRAM, POLICY OR OTHER
ARRANGEMENT WHICH HAS HERETOFORE BEEN OR SHALL HEREAFTER BE ESTABLISHED BY ANY
MEMBER OF THE COMPANY AFFILIATED GROUP.

 

(G)                                 RESIGNATION.  UPON TERMINATION OF THE
EXECUTIVE’S EMPLOYMENT FOR ANY REASON, THE EXECUTIVE SHALL BE DEEMED TO HAVE
RESIGNED FROM ALL POSITIONS WITH ANY MEMBER OF THE COMPANY AFFILIATED GROUP, AS
APPLICABLE.

 

(H)                                 COOPERATION FOLLOWING TERMINATION. 
FOLLOWING TERMINATION OF THE EXECUTIVE’S EMPLOYMENT FOR ANY REASON, THE
EXECUTIVE AGREES TO REASONABLY COOPERATE WITH THE COMPANY UPON THE REASONABLE
REQUEST OF THE BOARD AND TO BE REASONABLY AVAILABLE TO THE COMPANY WITH RESPECT
TO MATTERS ARISING OUT OF THE EXECUTIVE’S SERVICES TO ANY MEMBER OF THE COMPANY
AFFILIATED GROUP.  THE COMPANY SHALL CAUSE THE EXECUTIVE TO BE REIMBURSED FOR,
OR, AT THE EXECUTIVE’S REQUEST, CAUSE THE EXECUTIVE TO BE ADVANCED, EXPENSES
REASONABLY INCURRED IN CONNECTION WITH SUCH MATTERS.

 

8.                                       EXECUTIVE’S REPRESENTATION.  THE
EXECUTIVE REPRESENTS TO THE COMPANY THAT THE EXECUTIVE’S EXECUTION AND
PERFORMANCE OF THIS AGREEMENT DOES NOT VIOLATE ANY AGREEMENT OR OBLIGATION
(WHETHER OR NOT WRITTEN) THAT THE EXECUTIVE HAS WITH OR TO ANY PERSON OR ENTITY
INCLUDING, WITHOUT LIMITATION, ANY PRIOR EMPLOYER.

 

9.                                       EXECUTIVE’S COVENANTS.

 

(A)                                  CONFIDENTIALITY.  THE EXECUTIVE AGREES AND
UNDERSTANDS THAT THE EXECUTIVE HAS BEEN, AND IN THE EXECUTIVE’S POSITION WITH
THE COMPANY THE EXECUTIVE WILL BE, EXPOSED TO AND RECEIVE INFORMATION RELATING
TO THE CONFIDENTIAL AFFAIRS OF THE COMPANY AFFILIATED GROUP, INCLUDING, WITHOUT
LIMITATION, TECHNICAL INFORMATION, BUSINESS AND

 

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MARKETING PLANS, STRATEGIES, CUSTOMER (OR POTENTIAL CUSTOMER) INFORMATION, OTHER
INFORMATION CONCERNING THE PRODUCTS, PROMOTIONS, DEVELOPMENT, FINANCING,
PRICING, TECHNOLOGY, INVENTIONS, EXPANSION PLANS, BUSINESS POLICIES AND
PRACTICES OF THE COMPANY AFFILIATED GROUP, WHETHER OR NOT REDUCED TO TANGIBLE
FORM, AND OTHER FORMS OF INFORMATION CONSIDERED BY THE COMPANY AFFILIATED GROUP
TO BE CONFIDENTIAL AND IN THE NATURE OF TRADE SECRETS.  THE EXECUTIVE WILL NOT
KNOWINGLY DISCLOSE SUCH INFORMATION, EITHER DIRECTLY OR INDIRECTLY, TO ANY
PERSON OR ENTITY OUTSIDE THE COMPANY AFFILIATED GROUP WITHOUT THE PRIOR WRITTEN
CONSENT OF THE COMPANY; PROVIDED, HOWEVER, THAT (I) THE EXECUTIVE SHALL HAVE NO
OBLIGATION UNDER THIS SECTION 9(A) WITH RESPECT TO ANY INFORMATION THAT IS OR
BECOMES PUBLICLY KNOWN OTHER THAN AS A RESULT OF THE EXECUTIVE’S BREACH OF THE
EXECUTIVE’S OBLIGATIONS HEREUNDER AND (II) THE EXECUTIVE MAY (X) DISCLOSE SUCH
INFORMATION TO THE EXTENT HE DETERMINES THAT SO DOING IS REASONABLE OR
APPROPRIATE IN THE PERFORMANCE OF THE EXECUTIVE’S DUTIES OR, (Y) AFTER GIVING
PRIOR NOTICE TO THE COMPANY TO THE EXTENT PRACTICABLE, UNDER THE CIRCUMSTANCES,
DISCLOSE SUCH INFORMATION TO THE EXTENT REQUIRED BY APPLICABLE LAWS OR
GOVERNMENTAL REGULATIONS OR BY JUDICIAL OR REGULATORY PROCESS.  UPON TERMINATION
OF THE EXECUTIVE’S EMPLOYMENT, THE EXECUTIVE SHALL PROMPTLY SUPPLY TO THE
COMPANY ALL PROPERTY, KEYS, NOTES, MEMORANDA, WRITINGS, LISTS, FILES, REPORTS,
CUSTOMER LISTS, CORRESPONDENCE, TAPES, DISKS, CARDS, SURVEYS, MAPS, LOGS,
MACHINES, TECHNICAL DATA AND ANY OTHER TANGIBLE PRODUCT OR DOCUMENT WHICH HAS
BEEN PRODUCED BY, RECEIVED BY OR OTHERWISE SUBMITTED TO THE EXECUTIVE IN THE
COURSE OF OR OTHERWISE IN CONNECTION WITH THE EXECUTIVE’S SERVICES TO THE
COMPANY AFFILIATED GROUP DURING OR PRIOR TO THE EMPLOYMENT TERM.

 

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(B)                                 NON-COMPETITION AND NON-SOLICITATION. 
DURING THE PERIOD COMMENCING UPON THE EFFECTIVE DATE AND ENDING ON THE 18-MONTH
ANNIVERSARY OF THE TERMINATION OF THE EXECUTIVE’S EMPLOYMENT WITH THE COMPANY,
THE EXECUTIVE SHALL NOT, AS AN EMPLOYEE, EMPLOYER, STOCKHOLDER, OFFICER,
DIRECTOR, PARTNER, ASSOCIATE, CONSULTANT OR OTHER INDEPENDENT CONTRACTOR,
ADVISOR, PROPRIETOR, LENDER, OR IN ANY OTHER MANNER OR CAPACITY (OTHER THAN WITH
RESPECT TO THE EXECUTIVE’S SERVICES TO THE COMPANY AFFILIATED GROUP), DIRECTLY
OR INDIRECTLY:

 

(I)                                     PERFORM SERVICES FOR, OR OTHERWISE HAVE
ANY INVOLVEMENT WITH, ANY BUSINESS UNIT OF A PERSON, WHERE SUCH BUSINESS UNIT
COMPETES DIRECTLY OR INDIRECTLY WITH ANY MEMBER OF THE COMPANY AFFILIATED GROUP
BY OWNING OR OPERATING (X) BROADBAND COMMUNICATIONS NETWORKS FOR TELEPHONE,
CABLE TELEVISION OR INTERNET SERVICES OR (Y) TRANSMISSION NETWORKS FOR
TELEVISION AND RADIO BROADCASTING, IN EACH CASE PRINCIPALLY IN THE UNITED
KINGDOM OR IRELAND (THE “CORE BUSINESS”); PROVIDED, HOWEVER, THAT THIS AGREEMENT
SHALL NOT PROHIBIT THE EXECUTIVE FROM OWNING UP TO 1% OF ANY CLASS OF EQUITY
SECURITIES OF ONE OR MORE PUBLICLY TRADED COMPANIES;

 

(II)                                  HIRE ANY INDIVIDUAL WHO IS, OR WITHIN THE
12 MONTHS PRIOR TO THE EXECUTIVE’S TERMINATION WAS, AN EMPLOYEE OF ANY MEMBER OF
THE COMPANY AFFILIATED GROUP WHOSE BASE SALARY AT THE TIME OF HIRE EXCEEDED
£65,000 PER YEAR AND WITH WHOM THE EXECUTIVE HAD DIRECT CONTACT (OTHER THAN ON A
DE MINIMIS BASIS); OR

 

(III)                               SOLICIT, IN COMPETITION WITH ANY MEMBER OF
THE COMPANY AFFILIATED GROUP IN THE CORE BUSINESSES, ANY BUSINESS, OR ORDER OF
BUSINESS FROM ANY PERSON THAT THE EXECUTIVE KNOWS WAS A CURRENT OR PROSPECTIVE
CUSTOMER OF ANY MEMBER OF

 

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THE COMPANY AFFILIATED GROUP DURING THE EXECUTIVE’S EMPLOYMENT AND WITH WHOM THE
EXECUTIVE HAD CONTACT;

 

PROVIDED, THAT, NOTWITHSTANDING THE FOREGOING, THE EXECUTIVE SHALL NOT BE DEEMED
TO BE IN VIOLATION OF CLAUSE (I) OR CLAUSE (III) OF THE FOREGOING BY VIRTUE OF
(I) REJOINING FRIED, FRANK, HARRIS, SHRIVER & JACOBSON LLP (OR ANY OF ITS
SUCCESSORS OR AFFILIATES) AS A PARTNER, MEMBER OR EMPLOYEE, AND ACTING IN SUCH
CAPACITY OR (II) ACTING AS AN ATTORNEY (AS PARTNER, SHAREHOLDER, MEMBER OR
EMPLOYEE) OR AS VICE PRESIDENT, DIRECTOR OR MANAGING DIRECTOR OR SIMILAR
POSITION AT ANY OTHER LAW FIRM, INVESTMENT BANKING FIRM OR CONSULTING FIRM,
INSTITUTIONAL INVESTOR OR SIMILAR ENTITY, IN EACH CASE SO LONG AS THE EXECUTIVE
TAKES REASONABLE STEPS TO INSULATE HIMSELF FROM THE BUSINESSES AND ACTIVITIES OF
ANY SUCH ENTITY THAT RELATE TO THE CORE BUSINESSES DURING ANY PERIOD THAT THIS
SECTION 9(B) IS IN EFFECT.

 

(C)                                  PROPRIETARY RIGHTS.  THE EXECUTIVE ASSIGNS
ALL OF THE EXECUTIVE’S INTEREST IN ANY AND ALL INVENTIONS, DISCOVERIES,
IMPROVEMENTS AND PATENTABLE OR COPYRIGHTABLE WORKS INITIATED, CONCEIVED OR MADE
BY THE EXECUTIVE, EITHER ALONE OR IN CONJUNCTION WITH OTHERS, DURING THE
EMPLOYMENT TERM AND RELATED TO THE BUSINESS OR ACTIVITIES OF ANY MEMBER OF THE
COMPANY AFFILIATED GROUP TO THE COMPANY OR ITS NOMINEE.  WHENEVER REQUESTED TO
DO SO BY THE COMPANY, THE EXECUTIVE SHALL EXECUTE ANY AND ALL APPLICATIONS,
ASSIGNMENTS OR OTHER INSTRUMENTS THAT THE COMPANY SHALL IN GOOD FAITH DEEM
NECESSARY TO APPLY FOR AND OBTAIN TRADEMARKS, PATENTS OR COPYRIGHTS OF THE
UNITED STATES OR ANY FOREIGN COUNTRY OR OTHERWISE PROTECT THE INTEREST OF ANY
MEMBER OF THE COMPANY AFFILIATED GROUP THEREIN.  THESE OBLIGATIONS SHALL
CONTINUE BEYOND THE CONCLUSION OF THE EMPLOYMENT TERM WITH RESPECT TO
INVENTIONS, DISCOVERIES,

 

14

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IMPROVEMENTS OR COPYRIGHTABLE WORKS INITIATED, CONCEIVED OR MADE BY THE
EXECUTIVE DURING THE EMPLOYMENT TERM.

 

(D)                                 ACKNOWLEDGMENT.  THE EXECUTIVE EXPRESSLY
RECOGNIZES AND AGREES THAT THE RESTRAINTS IMPOSED BY THIS SECTION 9 ARE
REASONABLE AS TO TIME AND GEOGRAPHIC SCOPE AND ARE NOT OPPRESSIVE.  THE
EXECUTIVE FURTHER EXPRESSLY RECOGNIZES AND AGREES THAT THE RESTRAINTS IMPOSED BY
THIS SECTION 9 REPRESENT A REASONABLE AND NECESSARY RESTRICTION FOR THE
PROTECTION OF THE LEGITIMATE INTERESTS OF THE COMPANY AFFILIATED GROUP, THAT THE
FAILURE BY THE EXECUTIVE TO OBSERVE AND COMPLY WITH THE COVENANTS AND AGREEMENTS
IN THIS SECTION 9 WILL CAUSE IRREPARABLE HARM TO THE COMPANY AFFILIATED GROUP,
THAT IT IS AND WILL CONTINUE TO BE DIFFICULT TO ASCERTAIN THE HARM AND DAMAGES
TO THE COMPANY AFFILIATED GROUP THAT SUCH A FAILURE BY THE EXECUTIVE WOULD
CAUSE, THAT THE CONSIDERATION RECEIVED BY THE EXECUTIVE FOR ENTERING INTO THESE
COVENANTS AND AGREEMENTS IS FAIR, THAT THE COVENANTS AND AGREEMENTS AND THEIR
ENFORCEMENT WILL NOT DEPRIVE THE EXECUTIVE OF AN ABILITY TO EARN A REASONABLE
LIVING, AND THAT THE EXECUTIVE HAS ACQUIRED KNOWLEDGE AND SKILLS IN THIS FIELD
THAT WILL ALLOW THE EXECUTIVE TO OBTAIN EMPLOYMENT WITHOUT VIOLATING THESE
COVENANTS AND AGREEMENTS.  THE EXECUTIVE FURTHER EXPRESSLY ACKNOWLEDGES THAT THE
EXECUTIVE HAS RECEIVED AN OPPORTUNITY TO CONSULT INDEPENDENT COUNSEL BEFORE
EXECUTING THIS AGREEMENT.

 

10.                                 INDEMNIFICATION.

 

(A)                                  TO THE EXTENT PERMITTED BY APPLICABLE LAW,
THE COMPANY SHALL INDEMNIFY THE EXECUTIVE AGAINST, AND SAVE AND HOLD THE
EXECUTIVE HARMLESS FROM, ANY DAMAGES, LIABILITIES, LOSSES, JUDGMENTS, PENALTIES,
FINES, AMOUNTS PAID OR TO BE PAID IN

 

15

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SETTLEMENT, COSTS AND REASONABLE EXPENSES (INCLUDING, WITHOUT LIMITATION,
ATTORNEYS’ FEES AND EXPENSES), RESULTING FROM, ARISING OUT OF OR IN CONNECTION
WITH ANY THREATENED, PENDING OR COMPLETED CLAIM, ACTION, PROCEEDING OR
INVESTIGATION (WHETHER CIVIL OR CRIMINAL) AGAINST OR AFFECTING THE EXECUTIVE BY
REASON OF THE EXECUTIVE’S SERVICE FROM AND AFTER THE EFFECTIVE DATE AS AN
OFFICER, DIRECTOR OR EMPLOYEE OF, OR CONSULTANT TO, ANY MEMBER OF THE COMPANY
AFFILIATED GROUP, OR IN ANY CAPACITY AT THE REQUEST OF ANY MEMBER OF THE COMPANY
AFFILIATED GROUP, OR AN OFFICER, DIRECTOR OR EMPLOYEE THEREOF, IN OR WITH REGARD
TO ANY OTHER ENTITY, EMPLOYEE BENEFIT PLAN OR ENTERPRISE (OTHER THAN ARISING OUT
OF THE EXECUTIVE’S ACTS OF MISAPPROPRIATION OF FUNDS OR ACTUAL FRAUD).  IN THE
EVENT THE COMPANY DOES NOT COMPROMISE OR ASSUME THE DEFENSE OF ANY INDEMNIFIABLE
CLAIM OR ACTION AGAINST THE EXECUTIVE, THE COMPANY SHALL PROMPTLY CAUSE THE
EXECUTIVE TO BE PAID TO THE EXTENT PERMITTED BY APPLICABLE LAW ALL COSTS AND
EXPENSES INCURRED OR TO BE INCURRED BY THE EXECUTIVE IN DEFENDING OR RESPONDING
TO ANY CLAIM OR INVESTIGATION IN ADVANCE OF THE FINAL DISPOSITION THEREOF;
PROVIDED, HOWEVER, THAT IF IT IS ULTIMATELY DETERMINED BY A FINAL JUDGMENT OF A
COURT OF COMPETENT JURISDICTION (FROM WHOSE DECISION NO APPEALS MAY BE TAKEN, OR
THE TIME FOR APPEAL HAVING LAPSED) THAT THE EXECUTIVE WAS NOT ENTITLED TO
INDEMNITY HEREUNDER, THEN THE EXECUTIVE SHALL REPAY FORTHWITH ALL AMOUNTS SO
ADVANCED.  THE COMPANY MAY NOT AGREE TO ANY SETTLEMENT OR COMPROMISE OF ANY
CLAIM AGAINST THE EXECUTIVE, OTHER THAN A SETTLEMENT OR COMPROMISE SOLELY FOR
MONETARY DAMAGES FOR WHICH THE COMPANY SHALL BE SOLELY RESPONSIBLE, WITHOUT THE
PRIOR WRITTEN CONSENT OF THE EXECUTIVE, WHICH CONSENT SHALL NOT BE UNREASONABLY
WITHHELD.  THIS RIGHT TO INDEMNIFICATION SHALL BE IN ADDITION TO, AND NOT IN
LIEU OF, ANY OTHER RIGHT TO

 

16

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INDEMNIFICATION TO WHICH THE EXECUTIVE SHALL BE ENTITLED PURSUANT TO THE
COMPANY’S CERTIFICATE OF INCORPORATION OR BY-LAWS OR OTHERWISE.

 

(B)                                 DIRECTORS’ AND OFFICERS’ INSURANCE.  THE
COMPANY SHALL USE ITS BEST EFFORTS TO MAINTAIN COMMERCIALLY REASONABLE
DIRECTORS’ AND OFFICERS’ LIABILITY INSURANCE DURING THE EMPLOYMENT TERM WHICH
WILL COVER THE EXECUTIVE.

 

11.                                 CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.

 

ANYTHING IN THIS AGREEMENT TO THE CONTRARY NOTWITHSTANDING, IN THE EVENT THAT IT
IS DETERMINED (AS HEREAFTER PROVIDED) THAT ANY PAYMENT (OTHER THAN THE GROSS-UP
PAYMENTS PROVIDED FOR IN THIS SECTION 11) OR DISTRIBUTION BY THE COMPANY OR ANY
OF ITS AFFILIATES TO OR FOR THE BENEFIT OF THE EXECUTIVE, WHETHER PAID OR
PAYABLE OR DISTRIBUTED OR DISTRIBUTABLE PURSUANT TO THE TERMS OF THIS AGREEMENT
OR OTHERWISE PURSUANT TO OR BY REASON OF ANY OTHER AGREEMENT, POLICY, PLAN,
PROGRAM OR ARRANGEMENT, INCLUDING, WITHOUT LIMITATION, ANY STOCK OPTION,
PERFORMANCE SHARE, PERFORMANCE UNIT, STOCK APPRECIATION RIGHT OR SIMILAR RIGHT,
OR THE LAPSE OR TERMINATION OF ANY RESTRICTION ON OR THE VESTING OR
EXERCISABILITY OF ANY OF THE FOREGOING (A “PAYMENT”), WOULD BE SUBJECT TO THE
EXCISE TAX IMPOSED BY SECTION 4999 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE “CODE”) (OR ANY SUCCESSOR PROVISION THERETO) BY REASON OF BEING
CONSIDERED “CONTINGENT ON A CHANGE IN OWNERSHIP OR CONTROL” OF THE COMPANY,
WITHIN THE MEANING OF SECTION 280G OF THE CODE (OR ANY SUCCESSOR PROVISION
THERETO) OR TO ANY SIMILAR TAX IMPOSED BY STATE OR LOCAL LAW, OR ANY INTEREST OR
PENALTIES WITH RESPECT TO SUCH TAX (SUCH TAX OR TAXES, TOGETHER WITH ANY SUCH
INTEREST AND PENALTIES, BEING HEREAFTER COLLECTIVELY REFERRED TO AS THE “EXCISE
TAX”), THEN THE EXECUTIVE WILL BE ENTITLED TO RECEIVE AN ADDITIONAL PAYMENT OR
PAYMENTS

 

17

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(COLLECTIVELY, A “GROSS-UP PAYMENT”).  THE GROSS-UP PAYMENT WILL BE IN AN AMOUNT
SUCH THAT, AFTER PAYMENT BY THE EXECUTIVE OF ALL TAXES (INCLUDING ANY INTEREST
OR PENALTIES IMPOSED WITH RESPECT TO SUCH TAXES), INCLUDING ANY EXCISE TAX
IMPOSED UPON THE GROSS-UP PAYMENT, THE EXECUTIVE RETAINS AN AMOUNT OF THE
GROSS-UP PAYMENT EQUAL TO THE EXCISE TAX IMPOSED UPON THE PAYMENT.  FOR PURPOSES
OF DETERMINING THE AMOUNT OF THE GROSS-UP PAYMENT, THE EXECUTIVE WILL BE
CONSIDERED TO PAY (X) FEDERAL INCOME TAXES AT THE HIGHEST RATE IN EFFECT IN THE
YEAR IN WHICH THE GROSS-UP PAYMENT WILL BE MADE AND (Y) STATE AND LOCAL INCOME
TAXES AT THE HIGHEST RATE IN EFFECT IN THE STATE OR LOCALITY IN WHICH THE
GROSS-UP PAYMENT WOULD BE SUBJECT TO STATE OR LOCAL TAX, NET OF THE MAXIMUM
REDUCTION IN FEDERAL INCOME TAX THAT COULD BE OBTAINED FROM DEDUCTION OF SUCH
STATE AND LOCAL TAXES.

 

12.                                 MISCELLANEOUS.

 

(A)                                  NON-WAIVER OF RIGHTS.  THE FAILURE TO
ENFORCE AT ANY TIME THE PROVISIONS OF THIS AGREEMENT OR TO REQUIRE AT ANY TIME
PERFORMANCE BY THE OTHER PARTY 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 HEREOF, OR THE RIGHT OF EITHER PARTY TO ENFORCE
EACH AND EVERY PROVISION IN ACCORDANCE WITH ITS TERMS.  NO WAIVER BY EITHER
PARTY HERETO AT ANY TIME OF ANY BREACH BY THE OTHER PARTY HERETO OF, OR
COMPLIANCE WITH, ANY CONDITION OR PROVISION OF THIS AGREEMENT TO BE PERFORMED BY
SUCH OTHER PARTY SHALL BE DEEMED A WAIVER OF SIMILAR OR DISSIMILAR CONDITIONS OR
PROVISIONS AT THAT TIME OR AT ANY PRIOR OR SUBSEQUENT TIME.

 

18

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(B)                                 NOTICES.  ALL NOTICES REQUIRED OR PERMITTED
HEREUNDER WILL BE GIVEN IN WRITING, BY PERSONAL DELIVERY, BY CONFIRMED FACSIMILE
TRANSMISSION (WITH A COPY SENT BY EXPRESS DELIVERY) OR BY EXPRESS NEXT-DAY
DELIVERY VIA EXPRESS MAIL OR ANY REPUTABLE COURIER SERVICE, IN EACH CASE
ADDRESSED AS FOLLOWS (OR TO SUCH OTHER ADDRESS AS MAY BE DESIGNATED):

 

If to the Company:

NTL House, Bartley Wood Business Park,
Hook, Hampshire RG27 9UP
Attention: Carolyn Walker, Group HR Director
Fax: +44 1256 752 454

 

 

With a copy to:

Fried, Frank, Harris,
Shriver & Jacobson LLP
One New York Plaza
New York, New York  10004
Fax: +001 212 859 4000
Attention:  Jeffrey Bagner, Esq.

 

 

If to the Executive:

Bryan H. Hall
514 Ridgewood Avenue
Glen Ridge, NJ 07028
With a copy to his address on file with the
Company’s payroll department
Fax: none

 

Notices that are delivered personally, by confirmed facsimile transmission, or
by courier as aforesaid, shall be effective on the date of delivery.

 

(C)                                  BINDING EFFECT; ASSIGNMENT.  THIS AGREEMENT
SHALL INURE TO THE BENEFIT OF AND BE BINDING UPON THE PARTIES HERETO AND THEIR
RESPECTIVE HEIRS, EXECUTORS, PERSONAL REPRESENTATIVES, ESTATES, SUCCESSORS
(WHETHER DIRECT OR INDIRECT, BY PURCHASE, MERGER, CONSOLIDATION, REORGANIZATION
OR OTHERWISE) AND ASSIGNS.  NOTWITHSTANDING THE

 

19

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PROVISIONS OF THE IMMEDIATELY PRECEDING SENTENCE, THE EXECUTIVE SHALL NOT ASSIGN
ALL OR ANY PORTION OF THIS AGREEMENT WITHOUT THE PRIOR WRITTEN CONSENT OF THE
COMPANY.

 

(D)                                 WITHHOLDING.  THE COMPANY SHALL WITHHOLD OR
CAUSE TO BE WITHHELD FROM ANY PAYMENTS MADE PURSUANT TO THIS AGREEMENT ANY
RELEVANT TAXES AS SHALL BE REQUIRED TO BE WITHHELD PURSUANT TO ANY LAW OR
GOVERNMENTAL REGULATION OR RULING IN ACCORDANCE WITH THE TAX EQUALIZATION POLICY
SET FORTH IN APPENDIX B.

 

(E)                                  ENTIRE AGREEMENT.  THIS AGREEMENT
CONSTITUTES THE COMPLETE UNDERSTANDING BETWEEN THE PARTIES WITH RESPECT TO THE
EXECUTIVE’S EMPLOYMENT AND SUPERSEDES ANY OTHER PRIOR ORAL OR WRITTEN
AGREEMENTS, ARRANGEMENTS OR UNDERSTANDINGS BETWEEN THE EXECUTIVE AND ANY MEMBER
OF THE COMPANY AFFILIATED GROUP.  WITHOUT LIMITING THE GENERALITY OF THIS
SECTION 12(E), EFFECTIVE AS OF THE EFFECTIVE DATE, THIS AGREEMENT SUPERSEDES ANY
EXISTING EMPLOYMENT, RETENTION, SEVERANCE AND CHANGE-IN-CONTROL AGREEMENTS OR
SIMILAR ARRANGEMENTS OR UNDERSTANDINGS (COLLECTIVELY, THE “PRIOR AGREEMENTS”)
BETWEEN THE EXECUTIVE AND THE COMPANY AND ANY MEMBER OF THE COMPANY AFFILIATED
GROUP, AND ANY AND ALL CLAIMS UNDER OR IN RESPECT OF THE PRIOR AGREEMENTS THAT
THE EXECUTIVE MAY HAVE OR ASSERT ON OR FOLLOWING THE EFFECTIVE DATE SHALL BE
GOVERNED BY AND COMPLETELY SATISFIED AND DISCHARGED IN ACCORDANCE WITH THE TERMS
AND CONDITIONS OF THIS AGREEMENT.  NO AGREEMENTS OR REPRESENTATIONS, ORAL OR
OTHERWISE, EXPRESS OR IMPLIED, WITH RESPECT TO THE SUBJECT MATTER HEREOF HAVE
BEEN MADE BY EITHER PARTY THAT ARE NOT SET FORTH EXPRESSLY IN THIS AGREEMENT.

 

(F)                                    SEVERABILITY.  IF ANY PROVISION OF THIS
AGREEMENT, OR ANY APPLICATION THEREOF TO ANY CIRCUMSTANCES, IS INVALID, IN WHOLE
OR IN PART, SUCH PROVISION OR APPLICATION

 

20

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SHALL TO THAT EXTENT BE SEVERABLE AND SHALL NOT AFFECT OTHER PROVISIONS OR
APPLICATIONS OF THIS AGREEMENT.

 

(G)                                 GOVERNING LAW, ETC.  THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF ENGLAND AND
WALES, WITHOUT REFERENCE TO THE PRINCIPLES OF CONFLICT OF LAWS.  BOTH PARTIES
IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF ENGLAND AND
WALES.

 

(H)                                 MODIFICATIONS.  NEITHER THIS AGREEMENT NOR
ANY PROVISION HEREOF MAY BE MODIFIED, ALTERED, AMENDED OR WAIVED EXCEPT BY AN
INSTRUMENT IN WRITING DULY SIGNED BY THE PARTY TO BE CHARGED.

 

(I)                                     NUMBER AND HEADINGS.  WHENEVER ANY WORDS
USED HEREIN ARE IN THE SINGULAR FORM, THEY SHALL BE CONSTRUED AS THOUGH THEY
WERE ALSO USED IN THE PLURAL FORM IN ALL CASES WHERE THEY WOULD SO APPLY.  THE
HEADINGS CONTAINED HEREIN ARE SOLELY FOR PURPOSES OF REFERENCE, ARE NOT PART OF
THIS AGREEMENT AND SHALL NOT IN ANY WAY AFFECT THE MEANING OR INTERPRETATION OF
THIS AGREEMENT.

 

(J)                                     COUNTERPARTS.  THIS AGREEMENT MAY BE
EXECUTED IN TWO OR MORE COUNTERPARTS, EACH OF WHICH SHALL BE DEEMED AN ORIGINAL
BUT ALL OF WHICH TOGETHER SHALL CONSTITUTE ONE AND THE SAME INSTRUMENT.

 

(signature page follows)

 

21

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IN WITNESS WHEREOF, the Company has caused this Agreement to be executed and the
Executive has executed this Agreement as of the day and year first above
written, in each case effective as of the Effective Date.

 

 

NTL INCORPORATED

 

 

 

 

 

/s/ Simon Duffy

 

By:  Simon Duffy

 

Title:  Chief Executive Officer

 

 

 

 

 

/s/ Bryan H. Hall

 

Bryan H. Hall

 

22

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Appendix A

 

DRAFT   NTL: ASSIGNMENT COMPENSATION SUMMARY SHEET

 

PERSONAL / ASSIGNMENT INFORMATION

 

Assignee Name:

Bryan Hall

Home Country:

United States of America

Host Country:

United Kingdom

Length of Assignment:

To 31st December 2006

Annual Leave Entitlement:

 

5 weeks

Accompanied Assignment:

Partner:

ý

(tick if accompanying)

 

Dependant(s):

2

(total accompanying assignee)

 

 

 

Assignment Remuneration Details

 

 

Assignment Base Salary (Gross):

£300,000

Tax Equalised:

Yes

Home for Tax Equalisation Purposes:

As per NTL policy

 

 

Tick if
Applies

 

Maximum Spend (£)

Ernst & Young LLP Tax Services

ý

 

As Agreed with Ernst & Young

Pre-Assignment Visit – Hotel Accommodation

ý

 

As per NTL policy

Pre-Assignment Visit – Daily Per Diem

ý

 

As per NTL policy

Relocation Allowance

ý

 

£25,000

Temporary Accommodation

ý

 

As per NTL policy

Housing

ý

 

£1,850 per week

Furniture Hire

ý

 

As per NTL policy

Company Car Cash Allowance

ý

 

£10,620 per annum

Home Leave

ý

 

As per NTL policy

 

 

 

 

Other Details

 

 

 

Pension

As per NTL policy (Company payment to US NTL Inc. 401(k) plan of 2/3rds of
Executive’s actual contribution to a maximum of 6% of base salary).

Social Security

Home

Healthcare

Cigna International Plan for self + family (four children total (all under the
age of 18))

Disability Insurance

UNUM Group Plan (for self)

Vision Plan

As per NTL policy

 

NOTE: THIS DOCUMENT ONLY PROVIDES A SUMMARY, REFERENCE MUST BE MADE TO
THE NTL EXPATRIATE POLICY AND THE NTL TAX EQUALISATION POLICY FOR
CONDITIONS ATTACHING TO ALL ITEMS DESCRIBED ABOVE

 

23

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Appendix B

 

NTL INCORPORATED
US TAX & SOCIAL SECURITY EQUALISATION POLICY
Effective 1st January 2004

 

A.                                   Objective

 

A US tax & social security equalisation policy has been established for
employees on assignment from the USA, as an employee’s actual tax liability will
be different from what it would have been had the employee not left the USA. 
This policy only applies to employees who are entitled to tax equalisation under
the terms of their Contract of Employment and/or Terms of Assignment
Letter/Assignment Compensation Summary Sheet.

 

Throughout this policy the masculine gender has been used for simplification and
is to be read in the feminine gender whenever appropriate.

 

The objective of this policy is to ensure that the employee pays approximately
no more or no less tax/social security on income and benefits than he would have
paid had that employee remained living and working in the USA.

 

By equalising income tax/social security costs for its employees, NTL Inc.
intends that each employee shall fully comply with the tax filing and payment
requirements imposed by the fiscal authorities in the host country and the USA.
Assistance will be provided to the employee by Ernst & Young LLP in order to
meet their Tax Return filing requirements. (Also refer to Section 3.5 of the
“Expatriate Policy”)

 

NTL Inc. reserves the right to amend this Tax Equalisation Policy as necessary.

 

B.                                     Reporting Obligations

 

NTL Inc. requires that all employees be familiar and comply fully with all
applicable national and local laws. In connection with tax/social security
matters, the following guidelines ensure that NTL Inc. and its employees will
meet those requirements.

 

•                  NTL Inc. regards timely compliance with worldwide income
tax/social security requirements as a mandatory obligation of each employee.

 

•                  An employee must conduct himself at all times so as to avoid
charges of fiscal evasion or abuse, or of violation of local law, which could
jeopardise in any way his standing personally or as a representative of NTL Inc.

 

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•                  An employee is expected to exercise care and attention in
minimising his liability for worldwide income taxes/social security
contributions in accordance with appropriate principles of fiscal planning. An
employee must co-operate with NTL Inc. to ensure that his home and host country
Tax Returns are filed in such a manner as to produce the lowest possible tax
permitted by law.

 

Each employee is required to report taxable income and pay income taxes to the
taxing authorities which have jurisdiction during the period of his assignment.
The income tax/social security contributions to be paid by each employee will be
governed by the fiscal laws and regulations under which the authorities operate.

 

Failure to Comply:

 

Upon notification by Ernst & Young LLP to NTL Inc. of an employee’s failure to
comply with all the above requirements, the employee will be given by written
notice one month to comply.

 

If after that time the employee continues to be non compliant a penalty
hypothetical tax rate of 50% will be imposed on all income specified under
Section D(1) below.

 

If after three months from the date of the above written notice the employee is
still non-compliant, entitlement to tax equalisation will cease immediately
together with eligibility for assistance under Section C below and Section 2.2
of the “Expatriate Policy”.  This will result in the employee being personally
responsible for payment of all tax and social security liabilities on worldwide
income, as well as the preparation and filing of all Tax Returns.

 

C.                                     Tax Return Preparation Assistance

 

It is the responsibility of each employee to ensure that the proper Tax Returns
are filed when due. NTL Inc. has engaged Ernst & Young LLP to assist employees
in meeting this obligation. The fee for such services will be borne directly by
NTL Inc.

 

Tax Returns prepared by Ernst & Young LLP will be kept confidential by them.
However, in completing annual tax equalisation reconciliation calculations,
limited essential information will be extracted from the actual home/host
country Tax Returns to facilitate operation of this Tax Equalisation Policy.

 

25

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D.                                    Implementation of Tax Equalisation

 

NTL Inc. will continue to withhold actual US Social Security contributions from
the compensation relating to the assignment period, subject to any statutory
limits and the terms of this Tax Equalisation Policy

 

Under this Tax Equalisation Policy, each employee will have a total income tax
and social security liability approximating to his liability had he not been
assigned outside the USA.  This position is achieved by calculating a
preliminary hypothetical tax/social security liability and reducing the
employee’s compensation by that amount.

 

In order to ensure that the preliminaryhypothetical tax retained during a year
is as near as possible to an employee’s final hypothetical tax obligation to NTL
Inc., an estimate of the employee’s personal income and allowable itemised
deductions will need to be provided to Ernst & Young LLP at the commencement of
the assignment and in January of each subsequent year of assignment.

 

Having reduced compensation by a retained hypothetical US income tax, NTL Inc.
will assume responsibility for paying the employee’s actual worldwide income tax
and social security liabilities, if any.

 

After the close of the year, and after an employee’s US Federal (and State, if
required) Tax Return has been filed, Ernst & Young LLP will prepare a year-end
reconciliation. The “preliminary hypothetical US tax” will be adjusted, to
reflect actual income and deductions in place of estimated amounts used at the
beginning of the year. This reconciliation will be the basis of a final
settlement between NTL Inc. and the employee of that year’s income tax
reimbursement.

 

1.                                       Hypothetical US tax (retained from pay)

 

Hypothetical tax represents an estimate of the employee’s US Federal and State
tax obligations on his projected taxable income. The Federal hypothetical tax
will be calculated using actual filing status, current dependency exemptions and
tax rates for the taxable year.

 

NTL Inc. policy is to calculate hypothetical State tax based upon a fixed rate
of 6% of hypothetical “adjusted gross income”.  The fixed State tax rate will be
reviewed every three years but there will be no mid assignment rate changes.

 

In summary, income to be included in the hypothetical tax calculations is as
follows:-

 

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•                  base salary (net after deduction of employee 401k
contributions and employee pre-tax medical contributions)

 

•                  bonus

 

•                  all income from stock based incentives

 

•                  group term life

 

•                  personal passive (investment) income

 

(See section 2(a) below for further definitions)

 

If married, passive income of the employee’s spouse will also be included.
Subject to the specific exception below, spousal salary and/or other earned
income from employment performed outside the USA, however, is specifically
excluded from the hypothetical calculation. Rationale: A spouse is eligible to
make an election under the IRS Code Sec.911 for a foreign earned income
exclusion in their own right. This, plus credit for foreign taxes paid on
foreign source wages, should result in no incremental US tax being due on such
income. The spouse remains personally liable for all foreign income tax and
social security contributions due.

 

In arriving at hypothetical taxable income, deductions will be available for:

 

•                  actual amounts claimed on Federal Tax Return to arrive at
“adjusted gross income”.

 

•                  actual itemised deductions per Federal Tax Return, excluding
any itemised deductions funded by NTL.

 

•                  actual mortgage interest and real estate taxes paid per
Federal Income Tax Return Schedule A, form 1040 as filed with the IRS.

 

•                  a deduction will be given for hypothetical State taxes
payable to NTL.

 

The hypothetical US income tax retained from pay may be changed by NTL Inc.
during the course of a year whenever there is a change in:

 

•                  the employee’s compensation; or

 

•                  401(k) contribution; or

 

•                  other NTL Inc. income/related deductions; or

 

27

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•                  a change in filing status or number of dependants.

 

Also, upon prompt notification to Ernst & Young LLP and verification of US
itemised deductions and deductible losses and adjustments such as US rental
losses, etc. NTL Inc. may reduce the retained hypothetical tax to give the
employee the appropriate reduction in retained hypothetical tax. Conversely, NTL
Inc. may increase the retained hypothetical tax in order to collect the
additional hypothetical US income tax on net personal income such as dividends,
interest, capital gains etc.

 

The hypothetical US income tax retained from pay is not a withholding tax and
should not be confused with the amount of US income tax withholding to which the
employee may have been subject prior to their assignment. The two amounts are
calculated in different ways and will often be different in amount. The
hypothetical US income tax is simply a negative item in the employee’s
compensation package which, because it approximates to his tax obligation for
the year on NTL Inc. income, provides the employee with approximately the same
net level of spendable income as if they had remained in the home location.

 

Spousal Income - Exception

 

In the event that both spouses are employed by NTL Inc. and on foreign
assignment, the hypothetical tax liability will be based on the inclusion of all
income (as above) and calculated on the basis of the married filing joint tax
rates. The hypothetical taxes payable by each spouse will be in proportion to
their respective gross income (as defined above), but net of 401k contributions
and/or other NTL Inc. income/related deductions.

 

2.                                       Final Hypothetical US Tax (for tax
reimbursement purposes)

 

As stated above, after the close of the year, the “preliminary hypothetical US
tax” will be adjusted to a “final hypothetical US tax” based on actual amounts.
This hypothetical US tax then becomes the “final” tax burden which an employee
must bear for the year.

 

Because the USA taxes its citizens and green-card holders on worldwide income,
the final hypothetical US tax will be based not only on NTL Inc. base salary and
bonus, etc as defined in Section 1 above, but also on the employee’s taxable net
personal income or loss, adjustments to income, and in most circumstances on his
actual itemised deductions as well. In the absence of a reduction in the
preliminary hypothetical US tax as discussed above, the NTL Inc. employee with
losses, alimony or itemised deductions will likely receive a cash reimbursement
from NTL Inc. after the end of the

 

28

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year. On the other hand, an NTL Inc. employee with net personal income will be
obliged to make a cash payment to NTL Inc. after the end of the year equal to
the additional hypothetical tax on such income. Such employees are thereby on
notice that they must have sufficient cash to pay this hypothetical tax on
personal income, or make arrangements for NTL Inc. to retain it through payroll.
Any additional hypothetical tax due to NTL/from NTL must be settled by either
the employee or NTL as appropriate within 30 days of receipt of the finalised
tax equalisation settlement from Ernst & Young LLP.

 

The final hypothetical US tax will be based on the following items:

 

(a)                           NTL Inc. Income

 

•                  Base salary, less 401(k) contributions and any other pre-tax
employee contributions. (For this purpose, in the case of an employee who works
a part-year on assignment for NTL Inc. and who works a part-year for NTL Inc. in
the US base salary will be the sum of the two part-year base salaries).

 

•                  Cash bonuses and any other cash incentive compensation.

 

•                  Income from all NTL Inc. stock based incentives, including,
but not limited to, non-qualifying stock options (NQSO) and Incentive Stock
Options (ISO)

 

•                  Imputed income from group term life insurance and any other
employee benefit considered taxable in the US which the employee would have
received independent of his assignment.

 

•                  Assignment related allowances and reimbursements including
the one month relocation allowance (See Expatriate Policy) are excluded from all
calculations of hypothetical tax to ensure that NTL Inc. bears the full cost of
any tax imposed on these items.

 

(b)                          Net Personal Income

 

“Net personal income” is the positive amount, which results from subtracting
“personal losses” from “personal income”. NTL Inc. reserves the right to “cap”
the amount of net personal income which it will tax equalise under this policy,
and also to limit its reimbursement of host country taxes thereon when such
taxes could have been avoided by following the tax advice of Ernst & Young LLP.

 

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“Personal income” encompasses income earned or received from sources other than
NTL Inc. It includes, but is not limited to, amounts from the following sources
which are taxable on an employee’s actual US Tax Return:

 

•                  Dividends.

 

•                  Interest.

 

•                  State income tax refunds.

 

•                  Net capital gain, including the taxable gain from the sale of
an employee’s US principal residence and gain from the sale of any residence
owned by the employee in the country of assignment or any other country outside
the USA

 

•                  Net rental income (but excluding NTL Inc. funded expenses).

 

•                  Net partnership income.

 

(See “The Expatriate Policy” Sections 3.10 & 5.2 for general rules for house
sales)

 

“Personal Income” also includes:

 

•                  Any salaries or compensation received by the employee prior
to, or subsequent to, the International Assignment, while self-employed or
employed by a corporation unrelated to NTL Inc..

 

•                  Any salaries, compensation or self-employment income received
by the employee’s spouse prior to, or subsequent to, the International
Assignment.

 

During the period of the employee’s assignment, to the extent that an employee’s
spouse has a job in the host country, or is self-employed there, the spouse will
be fully responsible for any income and social taxes imposed on the spouse’s
income. In this circumstance, the year-end US tax equalisation calculation will
not reflect a final hypothetical US income tax on such income; and in
calculating the actual US income tax if any, attributable to the spouse’s
income, the spouse will receive the full benefit of the spouse’s “earned income
exclusion” and the appropriate “foreign tax credit” available under US tax law.

 

“Personal losses” encompass losses funded exclusively by the employee. This
category includes, but is not limited to:

 

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•                  Net capital loss deductible on the actual US income Tax
Return.

 

•                  Net rental loss deductible on the actual US income Tax Return
(but excluding any NTL Inc. funded expenses).

 

•                  Net partnership loss deductible on the actual US income Tax
Return.

 

(c)                           Net Personal Loss

 

“Net Personal Loss is the negative amount which results from subtracting
“personal losses” from “personal income”.

 

(d)                          Deductions

 

The following deductions which are not funded by NTL Inc. will be allowed in
arriving at an employee’s hypothetical taxable income for purposes of computing
his final hypothetical US income tax:

 

•                  Adjustments to gross income claimed on the employee’s actual
US income Tax Return for the taxable year, such as alimony and deductible IRA
contributions; plus

 

•                  the amount of actual itemised deductions deductible on an
employee’s US income Tax Return for the taxable year plus the amount of the
final hypothetical State income tax for the year.

 

An employee’s actual itemised deductions will be reduced by those expenses which
were reimbursed (directly or in the form of an allowance) by NTL Inc.

 

The phase out of itemised deductions for high income tax payers will be
recalculated based upon the hypothetical stay at home income included in the
final annual tax equalisation settlement

 

(e)                           Tax Rates & Filing Status

 

In computing the final hypothetical US income tax, the tax rates and filing
status to be used are those used on the actual US Federal  income Tax Return and
the fixed State tax rate (See Section 1 above) for the year.

 

3.                                       Reimbursement of Actual Worldwide
Income Taxes & Social Security

 

Having reduced an employee’s compensation by a retained hypothetical US income
tax which is later adjusted to a final hypothetical US tax, NTL Inc.

 

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will reimburse the actual amount of worldwide income taxes paid by an employee
as well as local social taxes paid, if any.

 

Whenever an employee must pay a local income or social tax, NTL Inc. will at
that time pay the amount of such tax to or on behalf of the employee. This
includes local income and social taxes in the form of:-

 

•                  Withholding taxes which NTL Inc. is required to pay over to
the assignment country government.

 

•                  Estimated tax filings made during the year.

 

•                  Payment of the balance due with the assignment country income
Tax Return or upon final assessment for the tax year.

 

In all cases, the employee’s cash flow will not be reduced by tax payments to
the assignment country government.

 

Verification of the actual amount of local taxes paid by each employee will be
provided by Ernst & Young LLP, which will communicate the amount thereof to NTL
Inc.. An amount equal to any local tax refunds must be paid or turned over to
NTL Inc. by the employee, since NTL Inc. (and not the employee) will have funded
all local taxes.

 

4.                                       Year-End US Tax Equalisation

 

After an employee’s US Tax Return has been filed, Ernst & Young LLP will prepare
a tax reconciliation calculation.

 

NTL Inc. will provide to Ernst & Young LLP the salary and other information
(retained hypothetical tax, etc.) necessary to complete this form. Ernst & Young
LLP will send the year-end US Tax reconciliation to NTL Inc. and the employee.
Both parties will review and approve the calculations provided by Ernst & Young
LLP.

 

The year-end US Tax reconciliation will reconcile the preliminary hypothetical
US income tax with the final hypothetical US income tax for the year. It will
also disclose the actual US income tax for the year (if any) which, under this
policy, is fully reimbursable by NTL Inc.. The reconciliation will then indicate
the net reimbursement owed to/by the employee, and NTL Inc. Reimbursement will
be made promptly, within 30 days of Ernst & Young LLP issuing the calculation.

 

NTL Inc. will reimburse the employee for all interest and penalties relating to
NTL Inc. income except when the assessment of the interest

 

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and penalties results from the negligence or fault of the employee; e.g., a
delay in submitting data booklets or tax questionnaires to Ernst & Young LLP
which in turn prevents the timely filing of a return. (Also see Section B above)

 

NTL Inc. will also reimburse interest imposed on any balance due resulting from
an extended due date for filing US Tax Returns granted to US taxpayers residing
overseas.

 

5.                                       Credits Allowed against US tax for Host
Country Taxes Paid

 

Any tax credits for host country taxes (referred to as “foreign tax credits”)
paid or reimbursed by NTL Inc. which reduce an employee’s US income tax
liability prior to, during or subsequent to his assignment, will be for the
benefit of NTL Inc..  This repayment is to be made within 14 days of receipt
from the IRS.

 

It also includes tax credits (reimbursed by NTL Inc.) which are carried back or
carried forward, regardless of whether the income in the carryback or carry
forward year is related to the International Assignment.  In such instances, an
employee must pay the amount of his tax refund received from the Internal
Revenue Service, plus interest, to NTL Inc..  This payment is to be made within
14 days of receipt of the refund.

 

6.                                       Net Operating Losses

 

Any net operating losses resulting from exclusions available to US citizens
working abroad will be considered to be for the benefit of NTL Inc., because the
tax benefit of these personal losses will have been fully realised by the
employee in the hypothetical tax calculation.  This includes a net operating
loss which is carried back or carried forward regardless of whether the income
in the carryback or carry forward year is related to the International
Assignment.  In such instances, an employee must pay the amount of his tax
refund received from the Internal Revenue Service and applicable State tax
authority, plus interest, to NTL Inc..  This payment is to be made within 14
days of receipt of the refund.

 

7.                                       Subsequent Adjustments

 

Assignment country government or US Internal Revenue Service or State government
examinations of employee Tax Returns are not uncommon.  When they occur, the
year-end US or local tax equalisation for that year will be recomputed, if
necessary, with adjustments made as appropriate.

 

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NTL will pay or reimburse reasonable fees, subject to prior approval, incurred
by Ernst & Young LLP for dealing with US IRS or foreign tax notices, audits and
examinations.

 

8.                                       “Tax on Tax”

 

Whenever NTL Inc. reimburses local or US income taxes (either currently, or in
the following year), such reimbursements themselves constitute taxable income
for US income tax purposes and, generally, for assignment country tax purposes
as well.  Under this Tax Equalisation Policy any “final” tax paid with respect
to income tax reimbursements will be fully reimbursed by NTL Inc. and grossed up
as appropriate.

 

For repatriated employees receiving tax reimbursements during the year
subsequent to termination of their International Assignment, the payment may be
grossed up to include any final tax due on the reimbursement in order to keep
the employee whole.

 

[9.                                   Short-term loans/advances

 

Even though compensation is reduced by the US hypothetical tax, it may be
necessary for NTL Inc. to withhold actual US or local taxes as applicable, and
to remit these taxes to the proper US and local taxing authorities.  In order to
ease the employee’s cash flow burden, the employee in such cases will receive a
loan or tax advance equal to the host and/or US taxes withheld, with the
approval of NTL Inc.  The total loan or tax advanced will be settled in the
following year at the time the Year-End US Tax Equalisation or local tax
reconciliation is prepared.]

 

10.                                 Annual settlement with employee

 

When the Year-End US Tax Equalisation calculations result in a balance due to
the employee, the amount will first be applied against any outstanding loans or
tax advances for the same year.  The remainder will be paid by NTL Inc. to the
employee.

 

If loans for a particular year exceed the amount of the tax equalisation balance
due, the employee must repay such excess loans to NTL Inc. within 14 days of
receiving the applicable refund of taxes from the US or host country taxing
authorities.  NTL Inc. reserves the right to recapture all unpaid tax loans by
reducing the employee’s base salary.

 

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11.                                 Treatment of new, returning, terminated and
retired employees

 

For an employee who is hired, transferred, terminated or who returns home during
the year, the Year-End US Tax Equalisation will be adjusted in order to compare:

 

•                  Hypothetical US income tax retained from compensation
(described above) during the portion of the year spent on International
Assignment,

 

•                  Final hypothetical US income tax (described above) on the
entire year’s income, and

 

•                  Actual US income tax liability on Form 1040 for the entire
year.

 

Where the employee was employed by an employer other than NTL Inc. or any
affiliate during the year, compensation from the employee’s previous or
subsequent employer will be treated as personal income and will therefore be
subject to US hypothetical tax and will be fully tax equalised.

 

Where the employee spent part of the year (either pre-assignment or post
assignment) in the US he will be fully responsible for applicable State income
taxes assessed during such part-year periods, except to the extent that such
State income taxes are increased by a NTL Inc. allowance on which NTL Inc.
assumes responsibility for paying actual taxes.

 

12.                                 Treatment of employees who are married to
participants in tax equalisation policies of other employers

 

For an employee whose spouse is employed in the host country by entities other
than NTL Inc. and is covered by a tax equalisation policy of another employer,
the manner in which the final hypothetical tax and reimbursable US and local
taxes are calculated will be determined on a case-by-case basis.  This approach
will ensure that an NTL Inc. employee receives the protection to which he is
entitled under the NTL Inc. US Tax & Social Security Equalisation Policy by
eliminating any distorted results which could occur if the standard calculations
were performed.

 

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Appendix C

 

NTL Incorporated Equity-Based Compensation

 

Options to purchase common stock of NTL Incorporated

 

The Executive will be granted 60,000 options at an exercise price equal to the
fair market value on the date of execution of the employment agreement.

 

Vesting period = three years

 

The options granted will vest 33% on each anniversary of the Effective Date.

 

Other terms:  The options will be subject to the Company’s standard form of
stock option agreement.

 

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Appendix D

 

A “Change in Control” shall be deemed to occur if the event set forth in any one
of the following paragraphs shall have occurred:

 

(I)                                     ANY PERSON IS OR BECOMES THE BENEFICIAL
OWNER, DIRECTLY OR INDIRECTLY, OF SECURITIES OF THE COMPANY (NOT INCLUDING IN
THE SECURITIES BENEFICIALLY OWNED BY SUCH PERSON ANY SECURITIES ACQUIRED
DIRECTLY FROM THE COMPANY) REPRESENTING 30% OR MORE OF THE COMBINED VOTING POWER
OF THE COMPANY’S THEN OUTSTANDING SECURITIES, EXCLUDING ANY PERSON WHO BECOMES
SUCH A BENEFICIAL OWNER IN CONNECTION WITH A TRANSACTION DESCRIBED IN CLAUSE (A)
OF PARAGRAPH (III) BELOW; OR

 

(II)                                  THE FOLLOWING INDIVIDUALS CEASE FOR ANY
REASON TO CONSTITUTE A MAJORITY OF THE NUMBER OF DIRECTORS THEN SERVING:
INDIVIDUALS WHO, ON THE DATE THE PLAN IS ADOPTED BY THE BOARD OF DIRECTORS OF
THE COMPANY (“BOARD”), CONSTITUTE THE BOARD AND ANY NEW DIRECTOR (OTHER THAN A
DIRECTOR WHOSE INITIAL ASSUMPTION OF OFFICE IS IN CONNECTION WITH AN ACTUAL OR
THREATENED ELECTION CONTEST, INCLUDING, WITHOUT LIMITATION, A CONSENT
SOLICITATION, RELATING TO THE ELECTION OF DIRECTORS OF THE COMPANY) WHOSE
APPOINTMENT OR ELECTION BY THE BOARD OR NOMINATION FOR ELECTION BY THE COMPANY’S
STOCKHOLDERS WAS APPROVED OR RECOMMENDED BY A VOTE OF AT LEAST A MAJORITY OF THE
DIRECTORS THEN STILL IN OFFICE WHO EITHER WERE DIRECTORS ON THE DATE HEREOF OR
WHOSE APPOINTMENT, ELECTION OR NOMINATION FOR ELECTION WAS PREVIOUSLY SO
APPROVED OR RECOMMENDED; OR

 

(III)                               THERE IS CONSUMMATED A MERGER OR
CONSOLIDATION OF THE COMPANY OR ANY DIRECT OR INDIRECT SUBSIDIARY OF THE COMPANY
WITH ANY OTHER CORPORATION, OTHER THAN (A) A MERGER OR CONSOLIDATION WHICH WOULD
RESULT IN THE VOTING SECURITIES OF THE COMPANY OUTSTANDING IMMEDIATELY PRIOR TO
SUCH MERGER OR CONSOLIDATION CONTINUING TO REPRESENT (EITHER BY REMAINING
OUTSTANDING OR BY BEING CONVERTED INTO VOTING SECURITIES OF THE SURVIVING ENTITY
OR ANY PARENT THEREOF) AT LEAST 50% OF THE COMBINED VOTING POWER OF THE
SECURITIES OF THE COMPANY OR SUCH SURVIVING ENTITY OR ANY PARENT THEREOF
OUTSTANDING IMMEDIATELY AFTER SUCH MERGER OR CONSOLIDATION, OR (B) A MERGER OR
CONSOLIDATION EFFECTED TO IMPLEMENT A RECAPITALIZATION OF THE COMPANY (OR
SIMILAR TRANSACTION) IN WHICH NO PERSON IS OR BECOMES THE BENEFICIAL OWNER,
DIRECTORY OR INDIRECTLY, OF SECURITIES OF THE COMPANY (NOT INCLUDING IN THE
SECURITIES BENEFICIALLY OWNED BY SUCH PERSON ANY SECURITIES ACQUIRED DIRECTLY
FROM THE COMPANY) REPRESENTING 30% OR MORE OF THE COMBINED VOTING POWER OF THE
COMPANY’S THEN OUTSTANDING SECURITIES; OR

 

(IV)                              THE STOCKHOLDERS OF THE COMPANY APPROVE A PLAN
OF COMPLETE LIQUIDATION OR DISSOLUTION OF THE COMPANY OR THERE IS CONSUMMATED AN
AGREEMENT FOR THE SALE OR DISPOSITION BY THE COMPANY OF ALL OR SUBSTANTIALLY ALL
OF THE COMPANY’S ASSETS, OTHER THAN A SALE OR DISPOSITION BY THE COMPANY OF ALL
SUBSTANTIALLY ALL OF THE COMPANY’S ASSETS TO AN ENTITY, AT LEAST 50% OF THE
COMBINED VOTING POWER OF THE VOTING SECURITIES OF WHICH ARE OWNED BY THE
STOCKHOLDERS OF THE COMPANY IMMEDIATELY PRIOR TO SUCH SALE.

 

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Notwithstanding the foregoing, a “Change in Control” shall not be deemed to have
occurred by virtue of the consummation of any transaction or series of
integrated transactions immediately following which the record holders of the
common stock of the Company immediately prior to such transaction or series of
transactions continue to have substantially the same proportionate ownership in
an entity which owns all or substantially all of the assets of the Company
immediately following such transaction or series of transactions.

 

For purposes of this Appendix D:

 

“Affiliate” shall have the meaning set forth in Rule 12b-2 under Section 12 of
the Securities Exchange Act of 1934.

 

“Person” shall have the meaning given in Section 3(a)(9) of the Securities
Exchange Act of 1934, as modified and used in Sections 13(d) and 14(d) thereof,
except that such terms shall not include (i) the Company or any of its
Affiliates, (ii) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any of its subsidiaries, (iii) an
underwriter temporarily holding securities pursuant to an offering of such
securities, or (iv) a corporation owned, directly or indirectly, by stockholders
of the Company in substantially the same proportions as their ownership of stock
of the Company.

 

“Beneficial Owner” shall have the meaning set forth in Rule 13d-3 under the
Securities Exchange Act of 1934, except that a Person shall not be deemed to be
the Beneficial Owner of any securities which are properly filed on a Form 13-G.

 

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Appendix E

 

RELEASE AGREEMENT

 

In consideration of the severance payments and benefits provided for or referred
to in the Employment Agreement, dated as of May 31, 2004, to which the
undersigned is a party (the “Benefits”), and the release from the undersigned
set forth herein, NTL Incorporated (the “Company”) and the undersigned agree to
the terms of this Release Agreement.

 

1.                                       The undersigned acknowledges and agrees
that the Company is under no obligation to offer the undersigned the Benefits,
unless the undersigned consents to the terms of this Release Agreement.  The
undersigned further acknowledges that he is under no obligation to consent to
the terms of this Release Agreement and that the undersigned has entered into
this agreement freely and voluntarily.

 

2.                                       The undersigned voluntarily, knowingly
and willingly releases and forever discharges the Company and its Affiliates,
together with their respective officers, directors, partners, shareholders,
employees, agents, and the officers, directors, partners, shareholders,
employees, agents of the foregoing, as well as each of their predecessors,
successors and assigns (collectively, “Releasees”), from any and all charges,
complaints, claims, promises, agreements, controversies, causes of action and
demands of any nature whatsoever that the undersigned or his executors,
administrators, successors or assigns ever had, now has or hereafter can, shall
or may have against Releasees by reason of any matter, cause or thing whatsoever
arising prior to the time of signing of this Release Agreement by the
undersigned.  The release being provided by the undersigned in this Release
Agreement includes, but is not limited to, any rights or claims relating in any
way to the undersigned’s employment relationship with the Company, or the
termination thereof, or under any statute, including the federal Age
Discrimination in Employment Act of 1967, Title VII of the Civil Rights Act of
1964, the Civil Rights Act of 1990, the Americans with Disabilities Act of 1990,
the Employee Retirement Income Security Act of 1974, the Family and Medical
Leave Act of 1993, each as amended, and any other federal, state or local law or
judicial decision (U.S. and non-U.S.).

 

3.                                       The undersigned acknowledges and agrees
that he shall not, directly or indirectly, seek or further be entitled to any
personal recovery in any lawsuit or other claim against the Company or any other
Releasee based on any event arising out of the matters released in paragraph 2.

 

4.                                       Nothing herein shall be deemed to
release (i) any of the undersigned’s rights to the Benefits, (ii) any of the
benefits that the undersigned has accrued prior to the date this Release
Agreement is executed by the undersigned under the Company’s employee benefit
plans and arrangements, or any agreement in effect with

 

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respect to the employment of the undersigned or (iii) any claim for
indemnification as provided under Section 10 of the Employment Agreement.

 

5.                                       In consideration of the undersigned’s
release set forth in paragraph 2, the Company knowingly and willingly releases
and forever discharges the undersigned from any and all charges, complaints,
claims, promises, agreements, controversies, causes of action and demands of any
nature whatsoever that the Company now has or hereafter can, shall or may have
against him by reason of any matter, cause or thing whatsoever arising prior to
the time of signing of this Release Agreement by the Company, provided, however,
that nothing herein is intended to release any claim the Company may have
against the undersigned for any illegal conduct or conduct constituting gross
negligence or willful misconduct in connection with his employment with the
Company.

 

6.                                       The undersigned acknowledges that the
Company has advised him to consult with an attorney of his choice prior to
signing this Release Agreement.  The undersigned represents that, to the extent
he desires, he has had the opportunity to review this Release Agreement with an
attorney of his choice.

 

7.                                       The undersigned acknowledges that he
has been offered the opportunity to consider the terms of this Release Agreement
for a period of at least twenty-one days, although he may sign it sooner should
he desire.  The undersigned further shall have seven additional days from the
date of signing this Release Agreement to revoke his consent hereto by
notifying, in writing, the Secretary of the Company.  This Release Agreement
will not become effective until seven days after the date on which the
undersigned has signed it without revocation.

 

 

 

 

 

 

Bryan Hall

 

 

 

 

 

 

 

 

NTL Incorporated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

Title:

 

 

 

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