Exhibit 10.1
EMPLOYMENT AGREEMENT
AGREEMENT dated as of December 15, 2005, by and between NTL
Incorporated, a Delaware corporation (the "Company"), and Xxxxxxx Xxxxx
(the "Executive").
WHEREAS, the Company wishes to employ the Executive as President and
Chief Executive Officer of the Company, effective not later than January
16, 2006 (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 President and Chief Executive Officer 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 President and Chief Executive Officer, 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, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. EFFECTIVENESS. This Agreement shall become effective as of the
Effective Date.
2. EMPLOYMENT TERM.
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(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, 2008, unless the Employment Term terminates
earlier pursuant to 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 President and Chief Executive Officer and, in such
capacity, shall perform such duties, services and responsibilities as are
commensurate with such position. In his capacity as President and Chief
Executive Officer, the Executive shall report to the Board of Directors of
the Company (the "Board"). 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 work
time to the performance of the Executive's duties hereunder and will not,
without the prior written approval of the Chairman of the Board 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.
(c) BOARD POSITION: The Company shall nominate the Executive to
serve on the Board of Directors of the Company as a Class II Director and
the Board of Directors of the Company shall as of the Effective Date take
such actions as may be necessary under the Bylaws of the Company to appoint
the Executive to such board seat.
3. MONETARY REMUNERATION.
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(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
$750,000 (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 British Pounds Sterling, 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 BONUS. During each fiscal year of the Company that the
Employment Term is in effect, the Executive shall be eligible to earn a
bonus in the sole discretion of the Board of (at target) 100%, but subject
to a maximum of 200%, of Base Salary (prorated for any partial fiscal year)
(the "Annual Bonus").
(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. Tax equalization shall be consistent with existing
Company Tax Equalization Policy, attached as Appendix B, and incorporated
by reference.
4. EQUITY-BASED COMPENSATION.
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During the Employment Term, the Executive will receive the
restricted stock as described as Appendix C, subject to a Restricted Stock
Agreement in the form attached as Appendix C-1.
5. BENEFITS.
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(a) During the Employment Term, the Executive shall be entitled to
participate in all of the employee benefit plans, programs, policies and
arrangements (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. 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, 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.
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(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 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 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(e) 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 2.
(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, 2008. 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(e) 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 2008 fiscal year, determined based on 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) TERMINATION FOR CAUSE. 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, in the nature of severance or termination.
DEFINITIONS
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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 President and Chief Executive Officer (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 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, 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 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 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 therefore.
(e) 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 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.
(f) 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.
(g) 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. [INTENTIONALLY OMITTED]
9. EXECUTIVE'S COVENANTS.
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(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 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.
(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
(pound)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 the Company Affiliated Group during the
Executive's employment and with whom the Executive had contact;
(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 xxxxx xxxx 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, 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.
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(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 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 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. MISCELLANEOUS.
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(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.
(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, Xxxxxxx Xxxx Xxxxxxxx Xxxx,
Xxxx, Xxxxxxxxx XX00 0XX
Attention: Xxxxxxx Xxxxxx, Group HR Director
With a copy to: Xxxxx Xxxx, General Counsel
Fax: x00 0000 000 000
If to the Executive: Xxxxxxx X. Xxxxx
000 Xxxxxxxx Xxxxxx Xxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
With a copy to his address on file with the
Company's payroll department.
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 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. The
Company may assign its rights and obligations hereunder to Telewest Global,
Inc. (or its ultimate parent holding company, if any) in connection with
the proposed merger transaction between the Company, Merger Sub Inc. and
Telewest Global, Inc. entered into on 2 October, 2005 (as may be amended)
and notwithstanding anything to the contrary herein, any such merger
transaction shall not constitute a Change in Control.
(d) 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. 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.
(e) 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 shall to that extent be severable and shall
not affect other provisions or applications of this Agreement.
(f) 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.
(g) 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.
(h) 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.
(i) 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)
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/ Xxxxx Xxxxxx
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By: Xxxxx Xxxxxx
Title: Chairman of the Board
/s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
APPENDIX A
NTL: ASSIGNMENT COMPENSATION SUMMARY SHEET
[INTENTIONALLY OMITTED]
APPENDIX B
NTL INCORPORATED TAX & SOCIAL SECURITY EQUALISATION POLICY
[INTENTIONALLY OMITTED]
APPENDIX C
NTL INCORPORATED EQUITY-BASED COMPENSATION
1. Restricted Stock
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The Executive will be granted 300,000 shares of Restricted Stock of NTL
Incorporated (or its successor) pursuant to the terms of a Restricted Stock
Agreement, attached as Appendix C-1.
Vesting period = three years
150,000 shares granted will vest 33% on each anniversary of the Effective
Date.
The remaining 150,000 shares will vest 33% on each anniversary of the
Effective Date, subject to performance milestones to be agreed to by the
Company and the Executive.
Upon the occurrence of a Change in Control, the 300,000 shares will have
accelerated vesting as provided in the form of Restricted Stock Agreement.
2. Long Term Incentive
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The Executive will be granted 50,000 shares of Restricted Stock in each of
first three years (for a total of 150,000) with individual "cliff" 3 year
vesting for each yearly tranche, based upon the Company's 3 year plan
achievement to be agreed.
Vesting upon the occurrence of a Change in Control will occur as follows:
(i) if the Change in Control occurs during the 2006 calendar year, 50,000
shares will automatically vest, and the Compensation Committee or the Board
of Directors will have the discretion to vest an additional 100,000 shares;
(ii) if the Change in Control occurs during the 2007 calendar year, 100,000
shares will automatically vest, and the Compensation Committee or the Board
of Directors will have the discretion to vest an additional 50,000 shares;
and (iii) if the Change in Control occurs during the 2008 calendar year,
150,000 shares will automatically vest.
EXHIBIT C-1
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NTL INCORPORATED
RESTRICTED STOCK AGREEMENT
RESTRICTED STOCK AGREEMENT dated as of January __, 2006, between NTL
Incorporated, a Delaware corporation (the "Company"), and Xxxxxxx X. Xxxxx
(the "Executive").
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 Amended and Restated NTL 2004 Stock Incentive Plan (the
"Plan");
NOW, THEREFORE, the parties hereto agree as follows:
1. Grant of Restricted Stock.
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The Company hereby grants to the Executive, and the Executive
hereby accepts from the Company, 300,000 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.
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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
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 an
applicable Lapse Date (as defined below), the Executive shall not be
entitled to transfer, sell, pledge, hypothecate, assign, or otherwise
dispose of or encumber, the shares of Restricted Stock subject to such
Lapse Date (collectively, the "Transfer Restrictions").
3. Vesting and Lapse of Transfer Restrictions.
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3.1 The Transfer Restrictions on 150,000 shares of the
Restricted Stock shall lapse and shall vest as follows:
(i) as to 50,000 shares on January 15, 2007;
(ii) as to 50,000 shares on January 15, 2008; and
(iii) as to 50,000 shares on December 31, 2008.
3.2 The Transfer Restrictions on the remaining 150,000 shares
of the Restricted Stock shall lapse and shall vest as
follows:
(i) as to 50,000 shares if performance conditions
agreed to by the Company and the Executive in
respect of the Company's 2006 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 January
15, 2007;
(ii) as to 50,000 shares if the performance conditions
agreed to by the Company and the Executive in
respect of the Company's 2007 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 January
15, 2008; and
(iii) as to 50,000 shares if the performance conditions
agreed to by the Company and the Executive 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.
The Lapse Date in respect of the shares of Restricted
Stock subject to this Section 3.2 shall occur on the date
on which the Committee determines that the applicable
performance conditions have been met and shall be
forfeited if the Committee determines that such
performance conditions have not been met. 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
necessary to make such determination.
3.3 Notwithstanding Section 3.1 or 3.2, upon the occurrence
of an Acceleration Event, the Transfer Restrictions on
all of the shares of Restricted Stock granted hereunder
and then outstanding shall lapse.
3.4 Each date on which Transfer Restrictions on shares of
Restricted Stock shall lapse and shall vest is referred
to in this Agreement as a "Lapse Date".
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 their
delivery to the Executive or the Executive's estate as
set forth in Section 4.2 hereof, subject to the
Executive's delivery of any documents which the Company
in its discretion may require as a condition to the
issuance of shares and the delivery of shares to the
Executive or the Executive's estate.
4.2 (a) Certificates representing those shares of Restricted
Stock in respect of which the Transfer Restrictions have
lapsed pursuant to Section 3 hereof shall be delivered to
the Executive as soon as practicable following the
applicable Lapse Date, provided that the Executive has
satisfied all applicable Withholding Tax requirements
with respect to the Restricted Stock.
(b) The Executive may receive, hold, sell, or otherwise
dispose of those shares delivered to the Executive
pursuant to paragraph (a) of this Section 4.2 free and
clear of the Transfer Restrictions, but subject to
compliance with all federal and state securities laws.
4.3 (a) Prior to the applicable Lapse Date, each stock
certificate evidencing shares of Restricted Stock as to
which the Transfer Restrictions have not lapsed 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 NTL Incorporated."
(b) As soon as practicable following each applicable
Lapse Date, the Company shall issue new certificates in
respect of the shares that have vested as of such Lapse
Date which shall not bear the legend set forth in
paragraph (a) of this Section 4.3, which certificates
shall be delivered in accordance with Section 4.2 hereof.
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.
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 each applicable 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. For the avoidance of doubt, (i) the Company may assign
its rights and obligations hereunder to Telewest Global, Inc. or its
successors (whether direct or indirect, by purchase, merger, consolidation,
reorganization or otherwise) in connection with the proposed merger
transaction pursuant to the agreement entered into between the Company and
Telewest Global, Inc. on 2 October 2005, as amended from time to time, and
(ii) in no event shall the consummation of such transaction be deemed to be
an Acceleration Event.
[The remainder of this page is intentionally blank.]
NTL INCORPORATED
By:
-----------------------------------
Xxxxx Xxxxxx, Chairman
ACCEPTED AND AGREED
By:
----------------------------
Executive
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,
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.
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.
APPENDIX E
RELEASE AGREEMENT
In consideration of the severance payments and benefits provided for or
referred to in the Employment Agreement, dated as of ________, 200__, to
which the undersigned is a party (the "Benefits"), and the release from the
undersigned set forth herein, NTL Incorporated (and its successors, 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
Release 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 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.
----------------------------------
Xxxxxxx X. Xxxxx
NTL Incorporated
----------------------------------
By:
Title:
