EXHIBIT 4.45
Xxxxxxx Xxxxxxx Esq
c/o Telewest Communications plc
Xxxxxxx Xxxxxxxx Xxxx
Xxxxxx Xxxxx
Xxxxxx
Xxxxxx XX00 0XX
Amendment to Service Agreement
I refer to your Service Agreement dated 7 August 1997 with Telewest
Communications Group Limited (the Company) (the Agreement) and confirm that the
Board of the Company has approved the following amendments to the Agreement to
take effect as of 1 September 1998.
The Telewest Long Term Incentive Plan (the LTIP)
1.1 The Company Confirms that it provisionally agreed to make you the awards of
shares under the LTIP set out in Schedule 1 but was prevented from granting the
awards by a closed period. When the closed period has ended the Company shall
enter such arrangements and exercise its discretions under the LTIP to make you
an award which will put you in the position you would have been in had the two
awards been made in the normal course.
1.2 If an award under paragraph 1.1 above cannot be made or if the Agreement is
terminated otherwise than pursuant to clause 14.1 before the Company has made an
award under paragraph 1.1, it shall pay you a sum calculated under the
provisions of Schedule 2.
The Telewest Equity Participation Plan (the EPP)
2.1 The Company confirms that it provisionally agreed to make you an award under
the EPP on 20 March 1998 of a bonus option of 13116 shares and a matching
allocation of 13116 shares. The market value of these shares on 20 March 1998
was (pound)0.955. However, the award could not be granted at that time as it
fell in a closed period. Therefore, the Company shall enter such arrangements
and exercise its discretions under the EPP to procure that such an award is made
at expiry of the closed period.
2.2 If an award under paragraph 2.1 above cannot be made or if the Agreement is
terminated otherwise than pursuant to clause 14.1 before the Company has made an
award under paragraph 2.1, the Company shall pay you compensation on terms which
reflect the benefit you would have enjoyed had the award been made. This sum
shall be calculated according the following formula:
A = B x C x D / 36
Where:
A is the amount of compensation;
B is the number of shares which you would have been awarded on 20 March
1998, had it not been a closed period;
C is the number of months from 20 March 1998 (award date) to the date of
termination of the Agreement; and
D is the market value of one of the shares on the date of termination of
the Agreement.
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Annual Bonus
3. Clause 4.3 of the Agreement shall be amended to entitle you, for the calendar
year 1998, to a bonus of up to 25% of your base salary, payable within 4 months
of the end of each calendar year, upon the Company achieving target performance,
increasing pro rata to a maximum of 50% of your base salary if the Company
exceeds target performance by the parameters approved by the board of the
Company.
Stay Bonus
4. Provided that the Agreement has not been terminated and you are still
employed by the Company by the time payment under this paragraph is due, the
Company shall pay you an additional bonus, the stay bonus, up to (pound)50,000
(subject to achievement of the targets referred to below) at the same time that
all other directors' bonuses for the calendar year 1998 are paid in March 1999.
If the Company terminates the Agreement otherwise than pursuant to clause 4.1.
of the Agreement on or after 1 January 1999 but before payment under this
paragraph is made, the Company will pay you a bonus determined pursuant to this
paragraph. This payment will not rank for participation in the EPP and will not
be regarded as base pay for your pension or any other purpose. (pound)25,000 of
the payment shall be regarded as attributable to your work in successfully
arranging bank re-financing in the early part of 1998 and in respect of the
achievement of the General Cable merger planning leading to an announcement. The
remaining (pound)25,000 is subject both to satisfactory performance and to the
achievement of the following specific objectives:
o negotiation for the exercise of pre-emption rights to acquire Cable
London and Birmingham Cable;
o the rights offer to shareholders and any related debt financing; and
o the merger with General Cable.
If any or all of' these objectives are not met, the Company may still award you
up to a (pound)25,000 bonus if it considers that the objective(s) was not met
due to matters beyond your control.
Change of Control and Material Diminution in Responsibilities
5.1 A Change of Control shall occur if at any time more than 50% of the voting
rights of Telewest Communications plc for the time being should become
controlled by any third party but, for the purposes of this paragraph neither
AT&T nor Liberty Media shall be considered a third party, (Change of Control).
For the avoidance of doubt, and for the sake of clarification, a Change of
Control will not occur if shareholders of the Company enter into voting
arrangements, or sell shares, between themselves. On a Change of Control the
Agreement shall be terminable, subject always to the terms and conditions set
out in paragraph 5.2, by written notice in the 6 months following the date of
Change of Control. If such notice is given to you by the Company the notice
period shall be 24 months and, if such notice is given to the Company by you the
notice period shall be 6 months. Thereafter, the Agreement shall be terminable
upon 12 months' notice by either party.
5.2 If:
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o you give notice to the Company to terminate the Agreement under paragraph
5.1 above between three and six months after the date of a Change of
Control and it can be demonstrated that, in the period between Change of
Control and the date you give notice, there has been a material diminution
in your responsibilities compared with those you held immediately prior to
the Change of Control; or
o in the six months following a Change of Control the Company terminates the
Agreement otherwise than pursuant to clause 14.1 of the Agreement;
then, in either case, the Company will pay to you within 7 days after the
termination of the Agreement a single lump sum equal. to the aggregate of:
(i) twice your basic annual salary at the date of termination; and
(ii) the aggregate of:
o the annual premium payable by the Company to provide the medical
expenses insurance in clause 7.1(a) of the Agreement;
o the annual value to you of the company car provided to you under
clause 8.1 of the Agreement calculated by the Company in
accordance with the Automobile Association's tables current at
the date of termination; and
o the annual value of other benefits to which you are entitled at
the date of termination as set out on the last form P11D returned
to the Inland Revenue in respect of your employment.
Termination
6. If the Agreement is terminated by you on a Change of Control (in
circumstances where there has been a diminution in your responsibilities as
described in paragraph 5.2) or by the Company after a Change of Control on or
before 3 1 December 1998:
6.1 the Company will pay you within 7 days after the termination the amounts
payable, if not already paid, under paragraph 4 above ((pound)50,000), subject
to the targets referred to being satisfied, so far as possible, in the period to
the termination of the Agreement;
6.2 the Company will pay you a pro rata bonus from the commencement of the then
current bonus year up to the date of termination [to be calculated by reference
to the average bonus received by the other executive directors in that year] and
to be paid on the date when other executive directors receive their bonuses in
respect of that year.
Liquidated damages
7. Clause 1.3 of the Agreement shall be replaced by the following clause:
1.3 The Company shall satisfy its obligations to give a period of notice under
Clause 1.2 by terminating the employment of the Executive no later than seven
days after the date it gives notice and paying to the Executive salary and a sum
equal to the value to him of (a) any outstanding guaranteed bonus and (b) the
other benefits to which he is entitled pursuant to Clauses 4, 5, 7 and 8 or
otherwise in lieu of notice.
Expenses
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8. A new clause 10.1(d) shall be included in the Agreement as follows:
(d) one business class return air fare per year between the United Kingdom and
the United States of America for the Executive, his spouse and children
below the age of 18 years.
Taxation
9. All payments made by the Company under the Agreement as amended by this
letter shall be made less tax and other deductions required by law.
Acceptance
Please signify your approval and acceptance of these amendments by signing both
of the enclosed copies of this letter, retain one and return the other to me.
Yours sincerely
/s/ Telewest Communications plc
For and on behalf of the Company
I agree to the terms set out above.
/s/ Xxxxxxx Xxxxxxx 14-10-98
XXXXXXX XXXXXXX Date
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SCHEDULE 1
The Telewest Long Term Incentive Plan
------------------------------------ -------------------------------- --------------------------------------------
Date of Award Number of Shares Proportion of Relevant Shares
------------------------------------ -------------------------------- --------------------------------------------
November 1997 264910 Y/36ths
------------------------------------ -------------------------------- --------------------------------------------
March 1998 244565 Z/36ths
------------------------------------ -------------------------------- --------------------------------------------
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SCHEDULE 2
Definitions
Allocation means a promise to transfer shares in the Company in accordance with
the rules of the Plan;
Company means Telewest Communications plc (for the purposes of this Schedule);
Executive means Xxxxxxx Xxxxxxx;
Notice of Exercise means a notice substantially in the form set out in Appendix
2 to this Schedule.
Participant means a person who has been given an Allocation under the Plan;
Payments means the cash payments or Shares representing a value equal to such
cash payments, set out in paragraphs 1 and 2 below or either of them;
Performance Period means:
(a) in respect of the Payment payable under paragraph 1 below, 1 January
1997 to 31 December 1999;
(b) in respect of the Payment payable under paragraph 2 below, 1 January
1998 to 31 December 2000;
Plan means the Telewest Long Term Incentive Plan;
Remuneration Committee means the Remuneration Committee of the Company.
Shares means Shares in the Company
1. Within 10 working days of the service of a Notice of Exercise by the
Executive (which may not be served before 31 December 1999 or after 31 January
2000) the Company shall pay the Executive a cash sum or, at the election of the
Remuneration Committee, transfer Shares equal in value to such cash sum, subject
to paragraphs 3 to 8 below, calculated in accordance with. the following
formula:
A x B x Y = 36
-
36
Where:
A is the number of allocated Shares under the Plan;
B is the Company's middle market share price (per Share) either:
o at the close of business on the date immediately preceding the
date on which a Notice of Exercise is served or, where
appropriate, an event within paragraph 4 below occurs; or
o at the close of business on the tenth working day preceding
the date of payment to the personal representatives under
paragraph 7 below.
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C is the product of A x B x Y in cash or Shares, the value of which at
-
36
the close of business on the date of valuation referred to in this
paragraph is equal to such cash sum. In the event that the cash sum
cannot be represented by a whole number of Shares, the number of Shares
shall be rounded up to the next whole number.
Y is the whole number of calendar months between 1 January 1997 and the
date of termination of the Service Agreement dated 7 August 1997, made
between the Executive and Telewest Communications Group Limited.
2. Within 10 working days of the service of a Notice of Exercise by the
Executive (which may not be served before 31 December 2000 or after 31 January
2001) the Company shall pay the Executive a cash sum or, at the election of the
Remuneration Committee, transfer Shares equal in value to such cash sum, subject
to paragraphs 3 to 8 below, calculated in accordance with the following formula:
D x E x Z = F
-
36
Where:
D is the number of allocated Shares under the Plan;
E is the Company's middle market share price (per Share) either:
o at the close of business immediately preceding the date on
which a Notice of Exercise is served, or where appropriate,
the occurrence of an event within paragraph 4 below occurs;
o at the close of business on the tenth working day preceding
the date of payment to the personal representatives under
paragraph 7 below.
F is the product of D x E x Z in cash or Shares, the value of which at
-
36
the close of business on the date of valuation referred to in this
paragraph is equal to such cash sum. In the event that the cash sum
cannot be represented by a whole number of Shares, the number of Shares
shall be rounded up to the next whole number.
Z is the whole number of calendar months between 1 January 1998 and the
date of termination of the Service Agreement dated 7 August 1997, made
between the Executive and Telewest Communications Group Limited.
3. Except where paragraph 4 below applies, such percentage of the Payments set
out in paragraphs 1 and 2 above shall be paid as the conditions in Appendix 1 to
this Schedule provide (Relevant Payments).
4. If any person obtains control of the Company (within the meaning of section
840 of the Income and Corporation Taxes Act 1988) as a result of making a
general offer to acquire shares in the Company or having obtained such control
makes such an offer, or if any person becomes bound or entitled to acquire
shares in the Company under sections 428 to 430F of the Companies Xxx 0000, or
if under section 425 of the Companies Xxx 0000 the Court sanctions a compromise
or arrangement proposed for the purposes of or in connection with a scheme for
the reconstruction of the Company or its amalgamation with any other company or
companies, or if the Company passes a resolution for voluntary winding up, or if
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an order is made for the compulsory winding up of the Company the Payments shall
be made in full to the Executive within 10 working days thereof (subject always
to paragraph 8 below).
5. For the purposes of paragraph 4 above, a person shall be deemed to have
obtained control of the Company if he and others acting in concert with him have
together obtained control of it.
6. In the event of any increase or variation of the share capital of the Company
(whenever effected), the Remuneration Committee may adjust the Payments as it
considers appropriate but in a manner consistent with any adjustment made to the
entitlements of at least a majority of the Participants in the Plan. As soon as
reasonably practicable after making any such adjustment the Company shall give
notice in writing to the Executive at his last known address.
7. If the Executive dies after the end of the relevant Performance Period but
before either or both of the Payments are paid, the outstanding Relevant
Payments shall be paid to the Executive's personal representatives as soon as
practicable following the death of the Executive. If the Executive dies before
the end of either of the Performance Periods, the Relevant Payments shall not be
made before the end of the respective Performance Periods.
8.1 Where the Payment is a cash sum, the Company shall withhold or make
necessary deductions from the Payment in respect of any tax or social security
contribution it is required to deduct from any such. payment:
8.2 Where the Payment is a transfer of Shares and the Company is obliged to
account for any tax and/or any social security contributions recoverable from
the Executive (together, the Tax Liability) for which the Executive is liable by
virtue of being entitled to the transfer of Shares, the Company shall not be
obliged to transfer the Shares, unless either it has received on or prior to the
transfer of the Shares payment from the Executive of an amount not less than the
Tax Liability, or the Executive has entered into arrangements reasonably
acceptable to the Company to secure that such a payment is made.
9. In the event of any dispute or disagreement as to the interpretation of this
Schedule, or as to any question or right arising from or related to this
Schedule, the decision of the Remuneration Committee shall be final and binding
provided that it is accepted that any entitlement pursuant to this Schedule
shall be generally no less favourable (other than in relation to the proportion
of Relevant Shares applicable) than that of the majority of the Participants in
the Plan.
10. Any alterations made pursuant to Rule 7 of the Plan shall also be made to
the terms of this Schedule, where relevant.
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APPENDIX 1
The Schedule to the Plan
PART A
1. For the purposes of this Appendix:
(a) TSR means total shareholder return, calculated by Datastream after:
(i) reinvesting dividends (plus associated tax credits) on a
company's shares on the day on which the shares went
ex-dividend on the London Stock Exchange;
(ii) making such adjustments to take account of any increase or
variation of the share capital of a company as the
Remuneration Committee considers relevant; and
(iii) averaging the index of closing share prices and reinvested
dividends for the period of three months preceding the
Performance Period and averaging the index of closing share
prices and reinvested dividends for the final. three months of
the Performance Period.
(b) the FT-SE 100 Index means the Financial Times - Stock Exchange index of
the market values of 100 leading UK equities;
(c) the Comparator Companies means the group of companies set out in Part B
of this Appendix (or such other such group of companies as the Board
may decide from time to time before a Payment is made, taking into
account any factors considered by the Board to be relevant);
(d) the Relevant FT-SE 100 Companies means the companies which were the
constituent companies for the purposes of the FT-SE 100 Index at the
commencement of the Performance Period in question and, if it was not
such a company, the Company;
(e) the Relevant Comparator Companies means the Company and the Comparator
Companies which were listed on the London Stock Exchange at the
commencement of the Performance Period in question;
(f) any reference to the Company's position is a reference to what would be
its position in a table of the Relevant FT-SE 100 Companies or a table
of the Relevant Comparator Companies arranged in descending order
according to the TSR of each of them for the Performance Period;
(g) in the event that one of the Relevant FT-SE 100 Companies or one of the
Relevant Comparator Companies is taken over, the TSR of that company
shall be calculated up to the date of change of control (within the
meaning of section 840 of the Income and Corporation Taxes Act 1988) of
that company on the basis that:
(i) if the takeover is on terms that an offer wholly or partly in
cash is made to shareholders, that cash is assumed to have
been reinvested in the FT-SE 100 Index for the balance of the
Performance Period;
(ii) if the takeover is on terms that it is compulsory for part or
all of the offer to be satisfied in the form of shares, those
shares are assumed to be held until the end of the Performance
Period.
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(h) in the event of a demerger of one of the Relevant FT-SE 100 Companies
or one of the Relevant Comparator Companies into two or more companies
quoted on a recognised stock exchange (within the meaning of that term
as set out in section 841 of the Income and Corporation Taxes Act
1988), the TSR of the relevant company will be calculated by
aggregating the total shareholder return of the demerged company or
companies and the company from which it or they demerged for the part
of the Performance Period following the demerger become effective.
2. If one of the events specified in paragraph 4 of Schedule 4 of this Agreement
occurs, for the purposes of the calculation of TSR the middle-market quotation
of the Relevant FT-SE 100 Companies or the Relevant Comparator Companies on such
date shall be taken as the final share price of such companies (and the final
share price shall not be averaged) and the final share price of the Company
shall be taken as the most valuable option offered to shareholders in the
Company as at the date of such event.
3. The percentage of the Payment, when TSR is measured against the Relevant
FT-SE 100 Companies, is as follows:
(a) 50% of the Payment if the Company is in the 25th (or a higher)
position;
(b) 12 1/2% of the Payment if the Company is in the 50th position;
(c) 0% of the Payment if the Company is in the 51st (or a lower) position;
and pro rata for positions between those specified at (a) and (b) above.
4. The percentage of the Payment, when TSR is measured against the Relevant
Comparator Companies, is as follows:
(a) 50% of the Payment if the Company has an upper quartile position;
(b) 12 1/2% of the Payment if the Company is at the median position (or if
there is no median position, the position immediately above the median
position);
(c) 0% of the Payment if the Company is below the median position;
and pro rata for positions between those specified at (a) and (b) above.
5. The Remuneration Committee may make such adjustments to the method of
calculating TSR or any other feature of this Appendix as it considers
appropriate to ensure that the condition in this Appendix achieves its original
purpose.
PART B
List of Comparator Companies
British Telecommunications plc
Vodafone Group plc
Orange plc
General Cable plc
British Sky Broadcasting Group plc
Flextech plc
Eurotunnel plc
Comcast Corp
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Nynex Corporation
International CabelTel Corp
Carlton Communications plc
Yorkshire Tyne Tees Television Holdings plc
HTV Group plc
Scottish Television plc
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APPENDIX 2
NOTICE OF EXERCISE
Mr C Xxxxxxx
[Address]
The Directors
Telewest Communications plc Xxxxxxx Xxxxxxxx Xxxx
Xxxxxx Xxxxx
Xxxxxx
Xxxxxx XX00 0XX
Dear Sirs
LETTER DATED [ ] (THE LETTER)
Pursuant to paragraph [1] [2] and subject to any deduction pursuant to paragraph
8 of Schedule 2 to the Letter I hereby serve a Notice of Exercise with the
effect that you shall make the Relevant Payments to me by cheque or by delivery
of Shares, such cheque or Shares to be received by me not later than 10 working
days of the date of this notice.
Yours faithfully
XXXXXXX XXXXXXX
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