Document:

Exhibit 10.3

 

VIRGIN MEDIA INC.

RESTRICTED STOCK AGREEMENT

 

RESTRICTED
STOCK AGREEMENT,
dated as of April 30, 2008, between Virgin Media Inc., a Delaware
corporation (the “Company”), and James F. Mooney
(the “Executive”).

 

WHEREAS, the Executive is
employed by the Company under the Amended & Restated Employment
Agreement dated as of July 5, 2006 (the “Employment
Agreement”) and which has a term thereunder which expires on April 30,
2009 (such term, as may be extended by amendment of the Employment Agreement,
the “Term”);

 

WHEREAS, the Executive
Committee of the Board of Directors (the “Board”)  of the Company (the “Executive Committee”)
and the Compensation Committee of the Board of the Company (the “Compensation Committee”)  has approved
the terms of this Agreement;

 

WHEREAS, the Company
wishes to grant to the Executive, and the Executive wishes to accept from the
Company, shares of common stock of the Company, par value $0.01 per share (the “Restricted Stock”), to be granted pursuant to the Virgin
Media Inc. 2006 Stock Incentive Plan (the “Plan”);

 

NOW, THEREFORE, the
parties hereto agree as follows:

 

1.             Grant of Restricted Stock.  The Company hereby grants to the Executive,
and the Executive hereby accepts from the Company, 125,000 shares of Restricted
Stock on the terms and conditions set forth in this Agreement.  This Agreement is also subject to the terms
and conditions set forth in the Plan. 
Capitalized terms used but not defined herein shall have the meanings
set forth in the Plan.

 

2.             Rights of Executive.  Except as otherwise provided in this
Agreement, the Executive shall be entitled, at all times on and after the date
that the shares of Restricted Stock are issued, to exercise all the rights of a
stockholder with respect to the shares of Restricted Stock (whether or not the
Transfer Restrictions thereon shall have lapsed), including the right to vote
the shares of Restricted Stock and the right, subject to Section 6 hereof,
to receive dividends thereon. 
Notwithstanding the foregoing, prior to the “Release Date” (as defined
in Section 4.1), the Executive shall not be entitled to transfer, sell,
pledge, hypothecate, assign or otherwise dispose of or encumber, the shares of
Restricted Stock (collectively, the “Transfer Restrictions”),
except that, as provided in Section 4.1, the Executive may sell such
number of shares as is reasonably necessary to pay for any US federal or state
income tax that may apply as a result of vesting upon the occurrence of the
relevant Lapse Date but in no event more than 45% of such shares.

 

3.             Vesting and Lapse of Transfer Restrictions.  The Transfer Restrictions on the Restricted
Stock shall lapse and the Restricted Stock granted hereunder shall vest on April 30,
2009 if performance conditions relating to group cash flow and EBITDA
established by the Executive Committee in respect of the Company’s 2008 fiscal
year have been met, so long as the Executive has remained continuously employed
by the Company from the date of commencement of his employment through December 31,
2008. Upon the occurrence of an Acceleration Event, the Transfer Restrictions
on all of shares of Restricted Stock which are then outstanding shall lapse and
such shares of Restricted Stock shall vest.

 

 

The Committee shall meet
to determine whether such performance conditions have been met promptly after
the completion by the Company of the financial reports or other information in
respect of the 2008 fiscal year.  The
restrictions on the shares of Restricted Stock subject to this Section 3
shall lapse on the date that the Committee determines that the applicable
performance conditions have been met in respect of the 2008 fiscal year (such
date, the “Lapse Date”), and the shares of
Restricted Stock shall be forfeited if the Committee determines that such
performance conditions have not been met. 
In no event shall the date of such determination occur later than the
last day of the 2009 fiscal year.

 

4.             Escrow and Delivery of Shares.

 

4.1           Certificates representing the shares
of Restricted Stock shall be issued and held by the Company in escrow and shall
remain in the custody of the Company until the earliest of (i) April 30,
2009, (ii) the date of the Executive’s termination of employment with the
Company and its Affiliates (other than by resignation) and (iii) the date
of vesting of the shares upon an Acceleration Event as provided herein (the
earliest of (i), (ii) and (iii), the “Release Date”);
provided, that in connection with any Lapse Date, the Company shall
deliver to the Executive a sufficient number of shares that have become vested
on such Lapse Date with a value equal to the Withholding Tax requirements, if
any (but in no event more than 45% of such vested shares) (the “Withholding Shares”).  As soon as practicable after the Release
Date, the shares of Restricted Stock that have become vested pursuant to Section 3
hereof that have not previously been delivered to the Executive shall be
delivered to the Executive or the Executive’s estate, subject to the delivery
of any documents which the Company in its discretion may require as a condition
to the issuance of shares, and so long as the Executive has satisfied all
applicable Withholding Tax requirements with respect to the Restricted Stock.

 

4.2           The Executive shall receive, hold,
sell, or otherwise dispose of those shares delivered to the Executive pursuant
to Section 4.1 free and clear of the Transfer Restrictions, but subject to
compliance with all federal and state securities laws.

 

4.3           Prior to the Release Date (or such
earlier date that is applicable to the Withholding Shares), each stock
certificate shall bear a legend in substantially the following form:

 

“This certificate and the
shares of stock represented hereby are subject to the terms and conditions
(including forfeiture, restrictions against transfer and rights of repurchase,
if applicable) contained in the Restricted Stock Agreement (the “Agreement”)
between the registered owner of the shares represented hereby and the
Company.  Release from such terms and
conditions shall be made only in accordance with the provisions of the
Agreement, a copy of which is on file in the office of the Secretary of Virgin
Media Inc.”

 

5.                                       Effect of Termination of Employment for
any Reason.  Upon termination of the Executive’s
employment with the Company and its Affiliates, if applicable, for any reason,
the Executive shall forfeit the shares of Restricted Stock which are then
subject to the Transfer Restrictions, and, from and after such forfeiture, such
shares of Restricted Stock shall cease to be outstanding and the Executive
shall have no rights with respect thereto; provided, that, if the Executive’s
employment shall terminate after the end of a fiscal year of the Company and
prior to the date of the determination as to whether the performance conditions
applicable to such fiscal year have been met, the shares of Restricted Stock
subject to vesting in respect of such fiscal year shall remain outstanding
following the termination of the Executive’s employment and shall vest or be
forfeited when such determination is made, 

 

2

 

in either case based on such determination; and provided, further, that
the shares of Restricted Stock shall be subject to vesting to the extent
provided in the Employment Agreement.

 

6.             Voting and Dividend Rights.  All dividends declared and paid by the
Company on shares of Restricted Stock shall be deferred until the lapsing of
the Transfer Restrictions pursuant to Section 3 hereof (and shall be
subject to forfeiture upon forfeiture of the shares of Restricted Stock as to
which such deferred dividends relate). 
The deferred dividends shall be held by the Company for the account of
the Executive.  Upon the Lapse Date, the dividends
allocable to the shares of Restricted Stock as to which the Transfer
Restrictions have lapsed shall be paid to the Executive (without
interest).  The Company may require that
the Executive invest any cash dividends received in additional Restricted Stock
which shall be subject to the same conditions and restrictions as the
Restricted Stock granted under this Agreement.

 

7.             No Right to Continued Employment.  Nothing in this Agreement shall be
interpreted or construed to confer upon the Executive any right with respect to
continuance of employment by the Company or any of its Affiliates, nor shall
this Agreement interfere in any way with the right of the Company or any such
Affiliate to terminate the Executive’s employment at any time.

 

8.             Withholding of Taxes.  The Executive shall pay to the Company, or
the Company and the Executive shall agree on such other arrangements necessary
for the Executive to pay, the applicable federal, state and local income taxes
required by law to be withheld (the “Withholding Taxes”),
if any, upon the vesting and delivery of the shares.  The Company shall have the right to deduct
from any payment of cash to the Executive an amount equal to the Withholding
Taxes in satisfaction of the Executive’s obligation to pay Withholding Taxes.

 

9.             Modification of Agreement.  This Agreement may be modified, amended,
suspended or terminated, and any terms or conditions may be waived, but only by
a written instrument executed by the parties hereto.

 

10.           Severability.  Should any provision of this Agreement be
held by a court of competent jurisdiction to be unenforceable or invalid for
any reason, the remaining provisions of this Agreement shall not be affected by
such holding and shall continue in full force and effect in accordance with
their terms.

 

11.           Governing Law.  The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of New
York without giving effect to the conflicts of laws principles thereof.

 

12.           Successors in Interest;
Transfer.  This Agreement shall inure
to the benefit of and be binding upon any successor to the Company.  This Agreement shall inure to the benefit of
the Executive’s heirs, executors, administrators and successors.  All obligations imposed upon the Executive
and all rights granted to the Company under this Agreement shall be binding
upon the Executive’s heirs, executors, administrators and successors.  This Agreement is not assignable by the
Executive.

 

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  VIRGIN MEDIA INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Bryan H. Hall

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Bryan H. Hall

  
	
   

  	
   

  	
  Title:

  	
  Secretary and General Counsel

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  EXECUTIVE

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ James F. Mooney

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  James
  F. Mooney

  	
   

  	
   

  	
   

  

 

4Exhibit 10.4

 

Description of the

 

Virgin Media Inc. 2008 Bonus
Scheme

 

The compensation
committee of Virgin Media Inc.’s board of directors approved the Company’s 2008
bonus scheme (the “2008 Bonus Scheme”) on March 28, 2008 covering the
majority of the Company’s employees, including the Company’s chairman and named
executive officers.  The principal terms
of the 2008 Bonus Scheme are set forth below:

 

Bonus Percentage and Scheme Levels

 

The 2008 Bonus Scheme
offers employees an opportunity to receive a bonus equal to a percentage of
their base salary. The percentages range from 5 - 100% of base salary
(depending on employee level) for on-target performance with a potential
maximum payment of double the on-target percentage. Employees also have the
opportunity to earn up to 1.2 times the calculated bonus amount depending on
the employee’s individual personal performance during the year.

 

Qualifying Gate Target

 

In order for any bonuses
to be payable, the Company must achieve a qualifying performance target (the “2008
Bonus Qualifying Gate”), which is based on the Company’s 2008 budgeted full
year group simple cash flow (which is defined as operating income before
depreciation, amortization and other charges less fixed asset additions on an
accrual basis). If the 2008 Bonus Qualifying Gate is not achieved, no bonus
payments will be made under the 2008 Bonus Scheme.

 

Divisional and Individual Performance Targets

 

If
the Qualifying Gate is achieved, bonuses will be payable according to
achievement against various performance targets specific to each of the Company’s
key operating divisions, as well as individually upon the achievement of
personal objectives.

 

The
operating division performance targets include an appropriately weighted mix of
financial and operating metrics for the group and the specific division,
including a combination of the following, among others:

 

·       Group simple cash flow

 

·       Divisional financial measures, including
revenue, gross margin, free cash flow, operating costs, working capital, simple
cash flow, capital expenditure and profitability measures

 

·       Customer service measures, including
fault rates, fault retention rates, installation completion rates, customer
advocacy, customer satisfaction and net promoter measures

 

·       Average contribution per customer, or
ACPU

 

·       Net additions to revenue generating
units, or RGUs

 

·       Commercial advertising impacts

 

 

·  Net present value of the residential
customer base

 

· Value of new sales contracts with
Business customers

 

·  Percentage of sales for sit-up generated
on-line

 

·  Page impressions for the
virginmedia.com portal

 

For all measures, the
amount to be achieved for on-target performance (the “100% Threshold”) is
generally equal to the reasonably targeted amount for that measure. A maximum
target (the “200% Threshold”) is also set for each measure at which the bonus
percentage payable is twice the on-target percentage payable. A minimum target
(the “50% Threshold”) is also set at which the bonus payable is one-half of the
on-target percentage payable. If the minimum 50% Threshold is not achieved for
a particular measure, no bonus percentage is earned in respect of that measure.
Percentage payments are structured to rise on a linear basis between the 50%
Threshold and the 100% Threshold and between the 100% Threshold and the 200%
Threshold.

 

Performance Multiplier

 

Individual
achievement against a personal objectives scorecard will determine a personal
multiplier against that individual’s divisional performance. The award amount
will depend on an individual’s final performance rating which is based on achievement
of personal objectives and the way in which they are achieved.  An individual could earn up to 120% of the
divisional bonus if his or her performance was considered exceptional during
the year.

 

Approval and Timing

 

Payments made under the
2008 Bonus Scheme will be approved by the compensation committee. Bonus
payments will be measured on full year performance and if performance is
achieved they will be paid in one installment on or around March 31, 2009.

 

Changes to Targets and Scheme Rules

 

The performance targets
and rules to the 2008 Bonus Scheme may be varied at any time by agreement
of the compensation committee.

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