exv4w2



Table of Contents




Exhibit 4.2


 


DATED 13 MAY 2004


 


BRITISH SKY BROADCASTING GROUP PLC


 


and


 


JAMES RUPERT MURDOCH


 

 







SERVICE AGREEMENT






 

 

	 	 
	 	Herbert Smith

Exchange House

Primrose Street

London EC2A 2HS

Tel: 0171 374-8000

Fax: 0171 374-0888

Ref: 2148/30843367





























TABLE OF CONTENTS



	 	 	 	 	 
	Clause          Headings		Page
	 		 
	
    
     1.                   INTERPRETATION
    

    	 	 	1	 
	
    
     2.                   APPOINTMENT
    AND TERM
    

    	 	 	2	 
	
    
     3.                   DUTIES
    

    	 	 	2	 
	
    
     4.                   SALARY
    AND BONUS
    

    	 	 	3	 
	
    
     5.                   PENSION
    SCHEME
    

    	 	 	4	 
	
    
     6.                   LIFE
    ASSURANCE AND HEALTH INSURANCE
    

    	 	 	4	 
	
    
     7.                   CAR
    

    	 	 	5	 
	
    
     8.                   ADDITIONAL
    BENEFITS
    

    	 	 	5	 
	
    
     9.                   OTHER
    EXPENSES
    

    	 	 	6	 
	
    
     10.                 HOLIDAYS
    

    	 	 	6	 
	
    
     11.                 SICKNESS
    AND INJURY
    

    	 	 	6	 
	
    
     12.                 OTHER
    ACTIVITIES AND INTERESTS IN OTHER BUSINESS
    

    	 	 	7	 
	
    
     13.                 SHARE
    DEALINGS
    

    	 	 	8	 
	
    
     14.                 CONFIDENTIALITY
    

    	 	 	8	 
	
    
     15.                 PROTECTION
    OF INTERESTS OF COMPANY, ETC
    

    	 	 	9	 
	
    
     16.                 TERMINATION
    

    	 	 	10	 
	
    
     17.                 INDEMNITY
    

    	 	 	13	 
	
    
     18.                 DISCIPLINE
    AND GRIEVANCES
    

    	 	 	13	 
	
    
     19.                 ADDITIONAL
    PARTICULARS
    

    	 	 	13	 
	
    
     20.                 ENTIRE
    AGREEMENT
    

    	 	 	13	 
	
    
     21.                 ASSIGNMENT
    

    	 	 	14	 
	
    
     22.                 NOTICES
    

    	 	 	14	 
	
    
     23.                 GOVERNING
    LAW
    

    	 	 	15	 
	
    
     24.                 COUNTERPARTY
    

    	 	 	15	 



















Table of Contents




AGREEMENT dated 13 May 2004




BETWEEN:



		
	(1)	
    BRITISH SKY BROADCASTING GROUP PLC (Company
    Number 2247735) whose registered office is at Grant Way,
    Isleworth, Middlesex TW7 5QD (the
    “Company”); and
	 
	(2)	
    JAMES RUPERT MURDOCH of Grant Way, Isleworth, Middlesex
TW7 5QD (the
    “Executive”).





WHEREAS:



		
	(A)	
    With effect from the date first above written, the Company
    wishes to contract with the Executive for the services of the
    Executive as Chief Executive and Managing Director of the Company (and each of
    its subsidiaries from time to time).
	 
	(B)	
    The Executive has agreed to provide his services in accordance
    with the terms and conditions hereinafter set out.





IT IS AGREED as follows:









 


		
	1.	
    INTERPRETATION



      
In this Agreement:



			
	 	(a)	
    “associate” means a body corporate which for
    the time being:





			
	 	(i)	
    is a holding company of the Company or a subsidiary (other than
    the Company) of such a holding company; or
	 
	 	(ii)	
    has not less than 20 percent of its equity share capital
    beneficially owned by such a holding company or the Company;





			
	 	(b)	
    “the Board” means the Board of Directors from
    time to time of the Company;
	 
	 	(c)	
    “Cause” means the circumstances referred to in
    clause 16.2;
	 
	 	(d)	
    “the Chairman” means the Chairman of the Board;
	 
	 	(e)	
    “Date of Termination” means the date on which
    the employment of the Executive terminates, for whatever reason
    (save pursuant to an assignment by the Company pursuant to
    clause 21 below);
	 
	 	(f)	
    “Group” means the Company and each of its
    subsidiaries from time to time;
	 
	 	(g)	
    “subsidiary” and “holding
    company” have the meaning attributed to them by
    section 736 and 736A of the Companies Act 1985 provided
    that the term “subsidiary” shall also include a
    subsidiary undertaking (as defined in section 258 of the
    Companies Act 1985);
	 
	 	(h)	
    “recognised stock exchange” means any body of
    persons which is a recognised investment exchange for the
    purpose of the Financial Services And Markets Act 2000;




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	 	(i)	
    “Remuneration Committee” means the committee of
    the Board which is so titled or such other body having similar
    functions as the Board may from time to time designate by notice
    in writing to the Executive;
	 
	 	(j)	
    a reference to the employment of the Executive is to his
    employment by the Company or, if appropriate, any assignee
    pursuant to clause 21 below under this Agreement;
	 
	 	(k)	
    unless the context otherwise requires, words in the singular
    include the plural and vice versa, and a reference to a person
    includes a reference to a body corporate and to an
    unincorporated body of persons;
	 
	 	(l)	
    a reference to a statute or statutory provision includes a
    reference to that statute or provision as from time to time
    modified or re-enacted;
	 
	 	(m)	
    clause headings are for convenience only and have no legal
    effect.











 


		
	2.	
    APPOINTMENT AND TERM




		
	2.1	
    The Company agrees to employ the Executive and the Executive
    agrees to provide his services as Chief Executive and Managing
Director of the Company (and of each member of the Group) or in such
other capacity as the Executive and the Company may from time to time
agree. During his employment under this Agreement the Executive shall
be the most senior person with executive responsibility for the
Company and each member of the Group.
	 
	2.2	
    The employment of the Executive on the terms of this Agreement
    will be deemed to have begun on 27 November 2003 and will
    continue, subject to the terms of this Agreement (and in
    particular clause 16), until determined by either party
    giving to the other at any time not less than 364 days’
    written notice.











 


		
	3.	
    DUTIES




		
	3.1	
    During the continuance of his employment as Chief Executive and
Managing Director of the Company, the Executive will:





			
	 	3.1.1	
    provide his services to and be responsible for the management and
operation of the affairs and business of the Company and each of the
other members of the Group from time to time;
	 
	 	3.1.2	
    be responsible for the recruitment, terms of appointment and
dismissal of staff in the Group provided that the recruitment of any
person whose base salary would be equal to or in excess of the amount
per annum specified from time to time by the Remuneration Committee,
and the terms of their employment (and any modification thereto)
shall be upon the recommendation of the Executive and shall be
subject to approval of the Remuneration Committee;
	 
	 	3.1.3	
    perform such duties as are generally held by and/or delegated to
chief executives and/or managing directors of UK companies whose
shares are publicly listed;
	 
	 	3.1.4	
    perform such other duties as may from time to time be necessary
to implement the decisions of the Board provided that such duties are
consistent with the




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    Executive’s position as the Managing Director and Chief
    Executive of the Group;
	 
	 	3.1.5	
    in all respects comply with the reasonable and lawful directions
    given by or under the authority of the Board which do not
    otherwise derogate from the terms of this Agreement, including
    complying with the Company’s corporate governance policies
    adopted from time to time by the Board;
	 
	 	3.1.6	
    use his best endeavours to promote the interests of the Group;
	 
	 	3.1.7	
    unless prevented by incapacity devote such of his business time
    and efforts as shall be necessary to perform his duties under
    this Agreement;
	 
	 	3.1.8	
    subject to removal as permitted under this Agreement or pursuant
    to the Articles of Association of the Company or by law, be
    entitled to be a director of the Company during the continuance
    of this Agreement; and
	 
	 	3.1.9	
    refer to the Board of the Company all matters which require
    Board approval.





		
	3.2	
    The agreed hours of work of the Executive will be such hours as
    may be required for the proper performance of his duties under
    this Agreement. The Executive will perform those duties at such
    place or places in the United Kingdom or elsewhere as the Board
    may from time to time determine PROVIDED THAT he shall be based
    at the principal executive offices of the Company located in
    London, England.











 


		
	4.	
    SALARY AND BONUS




		
	4.1	
    During the continuance of his employment, the Executive will be
    entitled to a salary at the rate of £750,000 per annum (or
    such higher rate as may from time to time to be agreed between
    the parties hereto) subject to an annual review in July in each
    year (which review shall never result in the Executive’s
    then annual salary being reduced) and such further merit reviews
    as the Board (acting in consultation with its Remuneration
    Committee) may in its sole discretion deem appropriate.
	 
	4.2	
    The Executive’s salary will accrue from day to day and
    shall be payable by equal monthly instalments in accordance with
    Company policy in effect from time to time.
	 
	4.3	
    If and to the extent that the amount of salary and Expenses
    Allowance (as defined in clause 8.1) received by the
    Executive in respect of the period from 27 November, 2003
    to 30 April 2004 falls short of the amount to which the
    Executive is entitled pursuant to the operation of
    clauses 4.1, 4.2 and 8.1, amount of the shortfall shall be
    added to the salary payment to be made in May 2004.
	 
	4.4	
    The Executive shall be paid a bonus amount depending upon the
    performance criteria adopted by the Remuneration Committee for
    each financial year during the continuance of the Agreement,
    including earnings growth, subscriber growth, magnitude of free
    cash flow and such other criteria which may be agreed with the
    Executive. The amount paid under this clause in respect of the
    financial year ending 30 June, 2005 will be
    £1 million if the performance targets for such year
    are met and such appropriate lesser amount if and to the extent
    such targets are not met up to a maximum of
    £1.5 million where such targets have been exceeded.
    The amount of bonus capable of being earned by the Executive in
    each subsequent financial year shall not be less than that
    capable of being earned in the financial year ending 30





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June, 2005 and shall similarly be calibrated against the budget
adopted by the Company following the annual planning process carried
out in conjunction with the Executive. For the year ending 30 June,
2004 the Executive shall be entitled to a discretionary bonus set at
a lower level to reflect, among other matters, the fact that the
Executive will not have been engaged by the Company throughout the
whole of the year ending on such date. The bonus (if any) due to the
Executive will be paid 14 days after the adoption of the accounts for
the relevant year. For the avoidance of doubt but subject always to
the provisions of clause 16, when the executive’s employment ends he
    will receive a bonus, as and when the amount of the same is
    calculated, which is pro rata to his length of service
    during the year in which the Date of Termination occurs.
	 
	4.5	
    The Executive shall be entitled to participate in the
    Company’s Long Term Incentive Plan for senior executives
    (“the LTIP”), in accordance with the rules of the
    LTIP from time to time and in this respect (and without prejudice
to the Executive’s eligibility to participate in awards in
subsequent financial years) the Company shall make a one off performance award
    to the Executive under the LTIP of 450,000 shares of the
    Company, the vesting of which shall be subject to performance
    criteria to be agreed between the Company and the Executive, it
    being accepted that 70% of the award will be subject to internal
    performance metrics being outperformed (equally weighting DTH
    subscriber growth, earnings per share growth and free cash flow
    per share) with the balance of 30% being subject to total
    shareholder return performance. Prior to any event which would
otherwise lead to a vesting of shares awarded under the LTIP the
Company may elect instead to pay the Executive in cash an amount
equal to the then market value of such shares and upon such payment
the right of the Executive to the vesting in him of such shares shall
lapse.











 


		
	5.	
    PENSION SCHEME




		
	5.1	
    The Executive shall be eligible to be a member of the BSkyB
    Pension Scheme (which is contracted out under the Social
    Security (Pensions) Act 1975) and to be a member of
    such scheme upon the terms and conditions from time to time
    applicable under such scheme.
	 
	5.2	
    The Company shall make contributions to such scheme at a rate of
    8% of the annual pensionable salary of the Executive from time
    to time. If and to the extent that the amount of the
    Company’s contributions is capped by law at an effective
    rate of less than 8% of the Executive’s annual salary, the
    Company shall pay to the Executive by way of additional salary the difference between 8% of the
    Executive’s annual salary and the amount of the capped rate.
	 
	5.3	
    The Executive shall be entitled to make contributions to such
    scheme at the rate of up to 4% of the annual salary of the
    Executive from time to time, or such lesser amount as may be
    permitted from time to time under such scheme.











 


		
	6.	
    LIFE ASSURANCE AND HEALTH INSURANCE




		
	6.1	
    Subject to cover being available at rates reasonably acceptable
    to the Company and to any conditions the Company may from time
    to time reasonably prescribe, the Company will provide and
    maintain, at its own expense, life assurance for the Executive
    with coverage equivalent to that which is provided to other
    senior executives of the Company but in no event less than four times
    the basic salary, such




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provision to be subject to the terms and conditions from time to time
of the insurance policy.
	 
	6.2	
    The Executive shall be entitled to membership of any medical
    insurance scheme in force for the time being and applicable for
    full-time employees or officers of the Company, for himself and
    his spouse and their unmarried children aged under 21 and the
    Company shall pay the subscriptions therefor.











 


		
	7.	
    CAR




		
	 	
     The Company shall provide the Executive with the use of a motor
    car of a make and type to be agreed between the parties hereto
and, where appropriate, a driver during the term of this Agreement.











 


		
	8.	
    ADDITIONAL BENEFITS




		
	8.1	Subject to the provisions of clause 8.2, in each
year during the continuance of his employment, the first such year
having commenced on 27 November, 2003, the Executive shall be
entitled to receive from the Company a relocation allowance of
£200,000 (the “Expenses Allowance”). The
Expenses Allowance shall be in satisfaction of the aggregate of all
the Executive’s expenses incurred in respect of those matters
listed under clause 8.3 (other than those which prior to the
date of this Agreement have already been paid or reimbursed by the
Company) and shall be payable in equal monthly instalments.
	 
	8.2	
If the employment of the Executive hereunder extends beyond three
years from 27 November, 2003 the Executive shall have no
entitlement to the Expenses Allowance for such fourth or any
subsequent year.
	 
	8.3	
The Expenses Allowance shall cover the following:





			
	 	8.3.1	all expenses incurred by the Executive in
connection with the provision of temporary accommodation for the
Executive (whether in a hotel or in a rented property);
	 
	 	8.3.2	all costs incurred by the Executive in
relocating to the United Kingdom to take up his employment with the
Company including any fees incurred in connection with obtaining any
visa or work permit required by the Executive, his spouse or his
children;
	 
	 	8.3.3	all costs of rental and maintenance of home
telephones and faxes and all charges for calls made thereon;
	 
	 	8.3.4	all professional fees incurred by the Executive
in connection with obtaining appropriate tax advice;
	 
	 	8.3.5	all costs in respect of non-business related
international flights for the Executive, his spouse and his children;
and
	 
	 	8.3.6	all school or education fees in respect of the
Executive’s children.
	 



		
	8.4	
    The Company shall also provide personal computer and facsimile
    machine facilities for the Executive at his residence(s)
    together with a mobile telephone and shall pay all costs
    associated with the ownership, maintenance and operation of such
    equipment.




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	9.	
    OTHER EXPENSES




		
	 	
     In addition to his remuneration hereunder the Executive shall
    be provided or reimbursed all first class (where available)
    travelling, hotel and other expenses properly and reasonably
    incurred by him in the discharge of his duties hereunder in
    accordance with the relevant rules of the Company
    for the time being in force which are notified to the Executive
    in writing, which said expenses shall be evidenced in such
    manner as the Company may reasonably require. Any credit and
    charge cards supplied to the Executive by the Company shall be
    returned to the Company on the termination of his employment.
    Any money paid to the Executive to meet expenses incurred on a
    Company credit or charge card shall be used for that purpose and
    no other. The Executive shall be liable for the discharge of any
    personal expenses incurred by him using the Company credit or
    charge card.











 


		
	10.	
    HOLIDAYS




		
	10.1	
    In addition to public holidays, the Executive will be entitled
    to that number of weeks’ holiday in each calendar year
    which the Company provides to its other senior executives, to be
    taken at such times as the business of the Company reasonably
    permits, and so that holidays not taken in one year may be
    carried over to succeeding years. A record of the holidays taken
    by the Executive shall be maintained by the Company.
	 
	10.2	
    On the termination of the Executive’s employment for any
    reason, payment in lieu of holiday accrued but not taken in the
    years up to the Date of Termination (and any preceding years)
    will be made.











 


		
	11.	
    SICKNESS AND INJURY




		
	11.1	
    If the Executive is absent from work due to sickness or injury
    he will be paid sick pay (at the rate of the Executive’s
    then current salary and benefits) by the Company as follows:





	 	 	 	 	 
	 	Service		Sick Pay
	 	
		

	 	
    
    Less than one year
    

    	 	13 weeks	 
	 	
    
    Over 1 year
    

    	 	26 weeks	 
	 





		
	 	
    Payment of company sick pay will be based on a 12 month
rolling period (i.e. any paid absence for sickness or injury in
the 12 months immediately preceding the commencement of a
new period of such absence will be deducted from the sickness
payment shown above).





		
	11.2	
    If the Executive shall at any time be incapacitated or prevented
    by illness, injury, accident or other circumstances beyond his
    control (such incapacity or prevention being hereinafter
    referred to as “the incapacity”) from
    discharging in full his duties hereunder for an aggregate of:-





			
	 	(i)	
    three months;
	 
	 	(ii)	
    his applicable sick leave entitlement; and
	 
	 	(iii)	
    his accrued holiday entitlement;





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     in any 12 consecutive calendar months the Company may by
    notice in writing to the Executive given at any time so long as
    the incapacity shall continue:





			
	 	(a)	
    discontinue payment in whole or part of the said salary on and
    from such date as may be specified in the notice until the
    incapacity shall cease; or
	 
	 	(b)	
    (whether or not payment shall already have been discontinued as
    aforesaid) terminate the employment forthwith or on such date as
    may be specified in the notice;





		
	 	
     provided that upon any such termination, the Company shall pay
    to the Executive, by way of compensation:





			
	 	(i)	
    two years salary calculated on the basis of the annual rate of
    salary applicable on the date notice is given;
	 
	 	(ii)	
    an amount equal to twice the value of the benefits (as described
    in clauses 5 to 8 inclusive of this Agreement) given by or
    on behalf of the Company to the Executive during the year
    preceding the Date of Termination save that any amount referable
    to the Expenses Allowance shall be reduced (before applying the
    two times multiplier) by and to the extent that the Expenses
    Allowance would have ceased to be payable in the following
    twelve months in accordance with clause 8.2;
	 
	 	(iii)	
    any expenses or benefits due to the Executive to the Date of
    Termination; and
	 
	 	(iv)	
    any bonus accrued in the financial year but not paid as at such
    termination in accordance with clause 4.4





		
	 	
     less the amount recovered by the Executive pursuant to any
    insurance policy provided to the Executive at the Company’s
    expense.





		
	11.3	
    The Executive shall comply with the Company’s illness and
    sickness reporting requirements as are notified to him in
    writing and in force from time to time.
	 
	11.4	
    The Company shall be entitled (but no more frequently than once
    in any twelve month period) to require the Executive to submit
    himself to a medical examination at the expense of the Company.











 


		
	12.	
    OTHER ACTIVITIES AND INTERESTS IN OTHER BUSINESS




		
	12.1	
    Save with the written consent of the Board, the Executive will
    not during the continuance of his employment be engaged or
    interested (except as the holder for investment of up to five
    percent (5%) of any class of quoted or unquoted securities)
    either directly or indirectly in any business or occupation in
    competition with the Company and its subsidiaries. To the extent
    that the Executive is engaged or interested in any other
    non-competing business or occupation during his employment, such
    engagement or interest shall in no way impinge on his working
    day at the Company nor detract from the proper performance of
    his duties.
	 
	12.2	
    The Executive hereby agrees with the Company that if, at any
    time during his employment hereunder, he becomes aware of any
    ideas or proposals that could be exploited by the Group in
    relation to its United Kingdom and the Republic of Ireland





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    satellite broadcasting business, he
    shall ensure that any such idea or proposal is offered to the
    Group, on a first refusal basis, before it is offered to any other person.











 


		
	13.	
    SHARE DEALINGS




		
	13.1	
    The Executive shall at all times comply with the requirements of
    section 324 of the Companies Act 1985 and will not act so
    as to commit an offence of insider dealing under Part V of
    the Criminal Justice Act 1993 nor engage in behaviour
    amounting to market abuse under Part VIII of the Financial
    Services and Markets Act 2000.
	 
	13.2	
    During his employment and, if later, until he ceases to be a director of the Company, the Executive will not (and will procure,
    so far as he is able, that his spouse, dependent children and
    persons connected with him will not) deal or become or cease to
    be interested (within the meaning contained in Part I of
    Schedule 13 to the Companies Act 1985) in any shares
    or other securities of the Company or any subsidiary or
    associate of the Company except in accordance with the
    Company’s Code of Practice in force from time to time in
    relation to such transactions, a copy of which is available from
    the Secretary of the Company.
	 
	13.3	
    During his employment and, if later, until he ceases to be a director of the Company, the Executive will notify the Secretary of
    the Company immediately of any dealing in the shares or other
    securities of the Company including the grant, acceptance,
    exercise or disposal of any option or other right or obligation
    to acquire or dispose of shares or securities. The notification
    shall include the nature of the dealing, the nature and extent
    of the Executive’s interest in it, the date on which the
    dealing was effected and the price, number (or amount) and class
    of shares or securities. The Executive will take all reasonable
    steps to notify the Secretary of the Company of any such dealing
    by persons connected with the Executive and to ensure that such
    persons are aware of his obligation to notify such dealing and
    to secure their co-operation in discharging it. In addition to
    the details required above, the notification of any such dealing
    shall include the identity of the person connected with the
    Executive.
	 
	13.4	
    For the purposes of this clause 13,
    “connected” has the meaning attributed to it by
    section 346 of the Companies Act 1985.











 


		
	14.	
    CONFIDENTIALITY




		
	14.1	
    The Executive will not during the continuance of his employment
    or afterwards (unless authorised to do so by the Board or by a
    court of competent jurisdiction):





			
	 	14.1.1	
    use for his own benefit or the benefit of any other person;
	 
	 	14.1.2	
    disclose to any person; or
	 
	 	14.1.3	
    through any failure to exercise all personal due care and
    diligence cause or permit any unauthorised disclosure of





		
	 	
     any confidential information of the Company or any of its
    subsidiaries which he has obtained by virtue of his employment
    or in respect of which the Company is bound by an obligation of
    confidence to a third party (“Confidential
    Information”). Confidential Information shall include,
    without limitation, information relating to research projects,
    prices, discounts, mark-ups, future business strategy,
    marketing, tenders and any price sensitive information.




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	14.2	
    The Executive shall not during the continuance of this Agreement
    make otherwise than for the benefit of the Company any notes,
    memoranda, records and writings relating to any matter within
    the scope of the business of the Group or concerning any of the
    Group’s dealings or affairs, it being agreed by the parties
    that all such notes or memoranda made by the Executive shall be
    the property of the Company and shall be handed over by the
    Executive to the Company from time to time on demand and in any
    event upon the Date of Termination.
	 
	14.3	
    The restriction in this clause will not prevent the Executive,
    after the Date of Termination, from using for his own or
    another’s benefit, any information which becomes available
    to the public generally other than by reason of a breach by the
    Executive of his obligations under this Agreement but any such
    use will be subject to the restrictions contained in
    clause 15 below.











 


		
	15.	
    PROTECTION OF INTERESTS OF COMPANY, ETC.




		
	15.1	
    In this clause:





			
	 	15.1.1	
    “Competing Business” shall mean any business
    carried on within the United Kingdom which wholly or partly
    competes with any business which at the Date of Termination the
    Company or any of its subsidiaries or associates carries on;
	 
	 	15.1.2	
    “Prospective Business” shall mean any business
    carried on within the United Kingdom which wholly or partly
    competes with any business which at the Date of Termination the
    Company or any of its subsidiaries or associates proposes to
    carry on in the immediate or foreseeable future, save for any
    such business in relation to which the Executive did not possess
    a material amount of Confidential Information as at the Date of
    Termination;





		
	15.2	
    Until the expiration of 6 months from the Date of
    Termination, except in the event of a termination of this
    Agreement by the Company in repudiatory breach of its terms, the
    Executive shall not directly or indirectly:





			
	 	15.2.1	
    carry on or be interested in a Competing Business SAVE that he
    may hold for investment up to 5% of any class of quoted or
    unquoted securities;
	 
	 	15.2.2	
    act as a consultant or employee or worker or officer in any
    capacity in a Competing Business or provide any advice to a
    Competing Business;






			
	 	15.2.3	
    act as a consultant or employee or officer in any capacity in a
    Prospective Business or provide any advice to a Prospective
    Business, SAVE to the extent that the Executive demonstrates to
    the reasonable satisfaction of the Company that his duties or
    work are not likely to involve disclosure or use of any of the
    Confidential Information possessed by the Executive.





		
	 	
     Provided always that nothing in this clause 15.2 shall be
    read or construed as preventing the Executive from acting as a
    consultant, employee or officer of, or for, that part, and that
    part only, of a business which does not compete, directly or
    indirectly, with any business which at the Date of Termination
    the Company or any of its subsidiaries or associates carries on
    or proposes to carry on provided further that the Executive
    demonstrates to the reasonable satisfaction of the Company that
    his




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     duties or work are not likely to involve disclosure or use of
    any of the Confidential Information possessed by the Executive.





		
	15.3	
    References in this clause to acting directly or indirectly
    include (without prejudice to the generality of that expression)
    references to acting alone or jointly with or by means of any
    other person.
	 
	15.4	
    Until the expiration of 6 months from the Date of
    Termination, the Executive will not directly or indirectly
    solicit or entice away or endeavour to solicit or entice away
    from the Company or any member of the Group, in competition with
    the Company or, as the case may be, in competition with the
    relevant member of the Group, any person employed by the Company
    or any member of the Group in a senior executive capacity at the
    Date of Termination with whom the Executive has had
    dealings during the year preceding the Date of Termination with
    a view to inducing that person to leave such employment and to
    act for another employer in the same, or a similar, capacity in
    relation to the same field of work.
	 
	15.5	
    After the Date of Termination or, if later, the date of his
    ceasing to be a director of the Company or any other member of
    the Group the Executive will not falsely represent himself or
    permit himself to be held out as being in any way connected with
    or interested in the business of the Company or the business of
    any member of the Group.
	 
	15.6	
    The restrictions in sub-clauses 15.2.1, 15.2.2, 15.2.3,
    15.4 and 15.5 hereof are separate and severable and in the event
    of any such restriction (including clause 15.3) being
    determined as being unenforceable in whole or in part for any
    reason such unenforceability shall not affect the enforceability
    of the remaining restrictions or in the case of part of a
    restriction being unenforceable, the remainder of that
    restriction.
	 
	15.7	
    The restrictions entered into by the Executive in
    sub-clauses 15.2.1, 15.2.2, 15.2.3, 15.4 and 15.5 are given
    to the Company for itself and as trustee for any member of the
    Group and the Executive agrees that he will at the request and
    cost of the Company enter into a further agreement with any such
    company whereby he will accept restrictions corresponding to the
    restrictions in this Agreement (or such of them as that company
    in its discretion shall deem appropriate). The Company declares
    that insofar as these restrictions relate to any member of the
    Group it holds the benefit of them as trustee. In exercising any
    right as trustee hereunder the Company shall be entitled to
    limit the action it takes to such action as it may, in its
    absolute discretion, consider reasonable.











 


		
	16.	
    TERMINATION




		
	16.1	
    (Termination by the Executive for Cause)





		
	 	
     The Executive will be entitled to terminate this Agreement
    immediately by notice in writing if:





			
	 	16.1.1	
    the Company commits a serious or persistent breach of any term
    of this agreement which is not rectified within twenty (20)
    business days of the written notice requiring remedy (if capable
    of remedy), provided, however, if the same or substantially
    similar breach has previously occurred and notice has been
    given, then no additional notice shall be required; or




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	 	16.1.2	
    he is removed or not re-appointed as a director of the Company.





		
	16.2	
    (Termination by BSkyB for Cause)





		
	 	
     The Company will be entitled to terminate the employment of the
    Executive immediately by notice in writing if he:





			
	 	16.2.1	
    commits a serious or persistent breach of any material term of
    this Agreement which is not
    rectified within ten (10) business days of the written notice
    requiring remedy (if capable of remedy), provided, however, if
    the same or substantially similar breach has previously occurred
    and notice has been given, then no additional notice shall be
    required;
	 
	 	16.2.2	
    is convicted of an indictable offence (other than a driving
    offence) for which a period of imprisonment (other than a
    suspended sentence) is imposed;
	 
	 	16.2.3	
    becomes of unsound mind, bankrupt or compounds with his
    creditors to the extent such compounding interferes with the
    Executive’s due and proper discharge of his duties; or
	 
	 	16.2.4	
    becomes prohibited by law from being a director of the Company
    (other than for reasons beyond the Executive’s control)
PROVIDED ALWAYS that the Company shall give all reasonable
assistance to the Executive (including but not limited to engaging
specialist immigration lawyers at the Company’s cost) to ensure
that his working visa or permit is reviewed or extended from time to
time when due.





		
	16.3	
    On due termination by the Company for Cause under
    clause 16.2, the Executive shall be entitled to receive
    such amount of his basic salary together with the benefits
    described in clauses 5 to 8 inclusive of this Agreement
    accrued due to him up to the Date of Termination but, for the
    avoidance of doubt, excluding the Executive’s annual bonus
    in accordance with clause 4.4 and the right to be granted
    an LTIP award pursuant to clause 4.5
	 
	16.4	
    On the Date of Termination (and without affecting the rights or
    remedies of either party in respect of such termination or
    rights or remedies accrued as at such Date of Termination) the
    Executive will promptly:





			
	 	16.4.1	
    resign (if he has not already done so) from all offices held by
    him in the Company and its subsidiaries and associates; and
	 
	 	16.4.2	
    deliver up to the Company all lists of customers,
    correspondence, documents, credit cards and other property
    (including but not limited to any car) belonging to the Company
    or any member of the Group which may be in his possession or
    under his control





		
	 	
     and the Executive irrevocably authorises the Company in his
    name and on his behalf to execute all documents and do all
    things necessary to effect the resignations referred to above,
    in the event of his failure to do so.





		
	16.5	
    Any rights or obligations of the Executive under this Agreement
    which are expressed to continue after the Date of Termination
    shall continue in full force and effect notwithstanding the
    termination of his employment, provided that:



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	 	16.5.1	
    any such rights shall not continue if the Executive’s
    employment is terminated by the Company for Cause under
    clause 16.2 or under clause 16.7 other than such
    rights as are specified in such clauses; and
	 
	 	16.5.2	
    any such obligations shall not continue if the Executive’s
    employment is terminated by the Executive for Cause under
    clause 16.1 or is otherwise terminated by the Company in
    breach of the terms of this Agreement.





		
	16.6	
    The Executive agrees that for the purposes of the Employment
    Rights Act 1996, the Company may apply any sums which may
    be due from the Company to the Executive (including, without
    limitation, accrued salary and/or holiday pay) at the Date of
    Termination against any sums which may be due from the Executive to the Company in respect of any overpayment of
    any amounts paid under this Agreement, any loans to the
    Executive made by the Company or any of its associates and any
    amounts in respect of income tax and PAYE liabilities.
	 
	16.7	
    (Termination for No Cause)





		
	 	
     The Company may, in its discretion, terminate the
    Executive’s employment forthwith at any time by giving him
    written notice together with a compensation payment of:





			
	 	16.7.1	
    one year’s salary calculated on the basis of the annual
    rate of salary applicable on the date notice is given;
	 
	 	16.7.2	
    an amount equal to the value of the benefits (comprising the
    benefits described in clauses 5 to 8 inclusive of this
    Agreement but, for the avoidance of doubt, excluding the
    Executive’s annual bonus in accordance with clause 4.4
    and the right to be granted an LTIP award pursuant to
    clause 4.5) given by or on behalf of the Company to the
    Executive during the last complete financial year preceding the
    Date of Termination save that any amount referable to the
    Expenses Allowance shall be reduced by and to the extent that
    the Expenses Allowance would have ceased to be payable in the
    following twelve months in accordance with clause 8.2;
	 
	 	16.7.3	
    an estimate of the amount of any bonus to which the Executive
    would be entitled in respect of the period up to the Date of
    Termination in accordance with clause 4.4; and
	 
	 	16.7.4	
    any expenses due to the Executive up to the Date of Termination.





		
	 	
     Any such payment (less any deductions which the Company may be
    required to make including, without limitation, in respect of
    income tax and less any amounts owed by the Executive to the
    Company in respect of any overpayment of any amounts paid under
    this Agreement, any loans to the Executive made by the Company
    or any of its associates and any amounts in respect of income
    tax and PAYE liabilities) shall be accepted by the Executive in
    full and final settlement of all claims which he may have
    against the Company or any subsidiary or associate of the
    Company arising out of his employment or its termination other
    than in respect of pension rights accrued up to the date of
    Termination, any personal injury claims and any claims pursuant
    to the indemnity or policy referred to in clause 17.
	 
	 	
     The discretion to terminate the Executive’s employment
    given to the Company by this clause shall not preclude the
    Company from exercising any right which it may have




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     validly to terminate the Executive’s employment pursuant
    to clause 16.2 of this Agreement.











 


		
	17.	
    INDEMNITY




		
	17.1	
    The Company shall to the fullest extent permitted by law
    indemnify and hold harmless the Executive from and in respect of
    any liability (including but not limited to legal costs on a
    full indemnity basis) that may be incurred by him in the due and
    proper performance of his duties hereunder and otherwise in
    giving effect to this Agreement.
	 
	17.2	
    The Company shall from time to time effect and maintain in the
    name of the Executive with a reputable insurance company a
    directors’ and officers’ liability policy in the name
    of the Company and so as to insure the Executive in respect of
    such risks as may be generally insured against for persons
    occupying similar positions to the Executive.











 


		
	18.	
    DISCIPLINE AND GRIEVANCES




		
	18.1	
    The Deputy Chairman of the Company will be responsible for
    communicating any disciplinary warnings to the Executive. Any
    dismissal will be communicated by the deputy Chairman of the
    Company with a right of appeal to the Board.
	 
	18.2	
    If the Executive has any grievance relating to his employment he
    may raise it initially with the Deputy Chairman of the Company.
    If the grievance is not thereby resolved the Executive may
    appeal to the Board whose decision will be final.











 


		
	19.	
    ADDITIONAL PARTICULARS




		
	 	
     The following additional particulars are given for the purposes
    of The Employment Rights Act 1996:





			
	 	19.1.1	
    the period of continuous employment of the Executive by the
    Company shall be deemed to have begun on 27 November, 2003;





			
	 	19.1.2	
    except as otherwise provided by this Agreement, there are no
    terms or conditions of employment relating to hours of work or
    to normal working hours or to entitlement to holidays (including
    public holidays) or holiday pay or to incapacity for work due to
    sickness or injury or to pensions or pension schemes or
    requiring the Executive to work outside the country for a period
    of more than one month.











 


		
	20.	
    ENTIRE AGREEMENT




		
	20.1	
    The Executive confirms that:





			
	 	20.1.1	
    in entering into this Agreement he has not relied on any
    representation, warranty, assurance, covenant, indemnity,
    undertaking or commitment which is not contained in this
    Agreement, or any document referred to in it; and
	 
	 	20.1.2	
    in any event, without prejudice to any liability for fraudulent
    misrepresentation or fraudulent misstatement, the only rights or
    remedies he has in relation to any representation, warranty,
    assurance, covenant, indemnity, undertaking or commitment given
    or action taken in connection




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     with the entering into or performance of this Agreement are
    under this Agreement and, for the avoidance of doubt and without
    limitation, the Executive does not have any right or remedy
    (whether by way of a claim for contribution or otherwise) in
    tort (including negligence) or for misrepresentation (whether
    negligent or otherwise, and whether made prior to, and/or in,
    this Agreement).











 


		
	21.	
    ASSIGNMENT




		
	 	
     The Company reserves the right forthwith on written notice to
    the Executive to assign its rights and obligations under this
    Agreement to any subsidiary or related company of the Company
    and thereafter any reference to the Company in this Agreement
    shall thereafter be as a reference to any such subsidiary or
    related company of the Company PROVIDED THAT nothing in
    this clause shall allow the Company or such subsidiary or
    related company to employ the Executive in any capacity other
    than Chief Executive and Managing Director of British Sky
    Broadcasting Group plc without the Executive’s written
    consent.











 


		
	22.	
    NOTICES




		
	22.1	
    A notice, approval, consent or other communication given under
    or in connection with this Agreement (in this clause known as a
    “Notice”):





			
	 	22.1.1	
    must be in writing:
	 
	 	22.1.2	
    must be left at the address of the addressee or sent by pre-paid
    first class post (airmail if posted from a place outside the
    United Kingdom) to the address of the addressee or sent by
    facsimile to the facsimile number of the addressee in each case
    which is specified in this clause, and marked for the attention
    of the person so specified, or to such other address in the
    United Kingdom or facsimile number and/or marked for the
    attention of such other person as the relevant party may from
    time to time specify by Notice given in accordance with this
    clause.





		
	 	
     The relevant details of each party are:
	 
	 	
     British Sky Broadcasting Group plc
	 
	 	
     Address: Grant Way, Isleworth, Middlesex, TW7 5QD
	 
	 	
     Facsimile: 0207 705 3254
	 
	 	
     Attention: Head of Legal and Business Affairs (marked
    “Private and Confidential”)
	 
	 	
     James Rupert Murdoch
	 
	 	
     Address: -c/o Grant Way, Isleworth, Middlesex TW7 5QD
	 
	 	
     Facsimile: 0207 705 6707





		
	22.2	
    In the absence of evidence of earlier receipt, any Notice shall
    take effect from the time that it is deemed to be received in
    accordance with clause 22.3 below.




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	22.3	
    Subject to clause 22.4 below, a Notice is deemed to be received:





			
	 	22.3.1	
    in the case of a Notice left at the address of the addressee,
    upon delivery at that address;
	 
	 	22.3.2	
    in the case of a posted letter, on the third day after posting
    or, if posted from a place outside the United Kingdom, the
    seventh day after posting;
	 
	 	22.3.3	
    in the case of a facsimile, on production of a transmission
    report from the machine from which the facsimile was sent which
    indicates that the facsimile was sent in its entirety to the
    facsimile number of the recipient provided that a confirmatory
    copy of such facsimile shall have been sent by post in
    accordance with clause 22.1 within 24 hours of such transmission.





		
	22.4	
    A Notice received or deemed to be received in accordance with
    clause 22.3 above on a day which is not a Business Day of after
    5 p.m. on any Business Day, shall be deemed to be received on
    the next following Business Day.
	 
	22.5	
    For the purposes of this clause, “Business Day”
    shall mean a day not being a Saturday on which trading banks are
    generally open for business in the City of London.
	 
	22.6	
    Each party undertakes to notify the other party by Notice served
    in accordance with the clause if the address or other details
    specified herein are no longer appropriate for the service of a
    Notice.











 



		
	23.	
    GOVERNING LAW




		
	 	
     This Agreement shall be governed by and interpreted in
    accordance with the laws of England and each of the parties
    irrevocably submits to the jurisdiction of the English Courts as
    regards any claim or matter arising under this Agreement.











 


		
	24.	
    COUNTERPARTY




		
	 	
     This Agreement may be signed in counterparts and each
    counterpart shall be valid and effective as if it had been
    executed by each of the parties and both such counterparts shall
    together constitute one document.





IN WITNESS whereof the parties hereto have executed this
Agreement as a Deed as of the day and year first above written.


	 	 	 	 	 
	
    SIGNED as a DEED
    by JAMES RUPERT
    	 	
    )
    	 	 
	
    MURDOCH	 	
    )
    	 	 
	
    in the presence of:-
    	 	
    )
    	 	 
	 
	 
	
	/s/ J. R Murdoch
			 

	
	 




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    SIGNED as a DEED
    by BRITISH SKY
    	 	
    )
    	 	 
	
    BROADCASTING GROUP PLC
    by its
    	 	
    )
    	 	 
	
    duly authorised agent
    	 	
    )
    	 	 
	 
	 
	
	/s/ M. D. Stewart
			/s/ D. Gormley





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