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Exhibit 10.4
EMPLOYMENT
AGREEMENT
THIS AGREEMENT
(the " Agreement ") is made as of September 18, 2007 by and between Virgin
Media Inc., a Delaware corporation (the " Company "), and Mark Schweitzer
(the " Executive ").
WHEREAS, the
Company wishes to employ the Executive as Chief Commercial Officer
reporting directly to the Chief Operating Officer or Chief
Executive Officer, effective as of October 1, 2007 (the
" Effective Date "), 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, receipt and sufficiency of
which is hereby acknowledged, the parties agree as
follows:
- 1.
- Effectiveness .
This Agreement shall be 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 September 30, 2010,
unless the Employment Term terminates earlier pursuant to
Section 6 of this
Agreement. The Employment Term may be extended by mutual agreement
of the Company and the Executive, such agreement to be reached by
thirty days prior to the expiration date. |
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(b) |
Title; Duties . During
the Employment Term, the Executive shall serve as Chief Commercial
Officer reporting directly to the Chief Operating Officer or Chief
Executive Officer, and shall perform such duties, services and
responsibilities as are reasonably requested from time to time by
the Chief Operating Officer or Chief Executive Officer and normal
and customary for this position. 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. |
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During the Employment Term, the Executive shall devote
substantially all of his time to the performance of the Executive's
duties hereunder. During the Employment Term, the Executive will
not, without the prior written approval of the Chief Executive
Officer of the Company, engage in any other business activity which
interferes in any material respect with the performance of the
Executive's duties hereunder or which is in violation of written
policies established from time to time by the Company. Nothing
contained in this Agreement shall preclude the Executive from
devoting a reasonable amount of time and attention during the
Employment Term to (i) serving, with the prior approval of the
Chief Executive Officer of the Company, as a director, trustee or
member of a committee of any not-for-profit organization;
(ii) serving on the board of directors of no more than one
for-profit company, subject, however, to the Executive giving prior
notification to the Chief Executive Officer of the Company and
obtaining the consent of the Chief Executive Officer of the Company
as to the identity of the company; (iii) engaging in
charitable and community activities; and (iv) managing
personal and family investments and affairs, so long as any
activities of the Executive which are within the scope of clauses
(i) to (iv) of this Section 2(b) do not interfere
in any material respect with the performance of the Executive's
duties hereunder. The Executive shall inform the General Counsel of
the Company about any such activities.
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- 3.
- Monetary Remuneration .
- (a)
- 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, affiliates 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 pay to the Executive an annual salary
of £330,000 from the Effective Date until the expiration (the
" Base Salary "). The Base Salary shall be payable in accordance with the
normal payroll practices of the Company in effect from time to time
for senior management generally; provided, that the Executive may
elect to receive all or any portion of the Base Salary in U.S.
dollars, subject to the Company's Exchange Rate Policy in effect
from time to time. If the Executive provides services to members of
the Company Affiliated Group other than the Company, no additional
compensation shall be paid by any such member to the Executive, and
any compensation for such services (if any) shall be paid to the
Company.
- (b)
- Annual Cash Bonus/Other.
- (i)
- During each fiscal year of the Company that the
Employment Term is in effect, the Executive shall be eligible to
earn a cash bonus in the sole discretion of the Board pursuant to
the terms of the Company's Executive Bonus Scheme in the expected
range of 0% to 150% (75% on-target), prorated for any partial
calendar year (the " Annual Cash
Bonus "). The Executive shall be entitled
to participate in the Company's 2008/2010 Long Term Incentive Plan
(LTIP), as may be amended from time to time. The LTIP is a
discretionary Company scheme. The Executive may elect to receive
all or any portion of the cash bonus or cash LTIP payment, if any,
in U.S. dollars, subject to the Company's Exchange Rate Policy in
effect from time to time.
- (ii)
- During the Employment Term, the Executive shall
be eligible to receive options to purchase common stock of the
Company in addition to the options described in Appendix A at such exercise
prices, schedules as to exercisability and other terms and
conditions as may be determined in the sole discretion of the Board
or its Compensation Committee under the Virgin Media Inc. 2006
Stock Incentive Plan.
- 4.
- Benefits .
- (a)
- General . During
the Employment Term, the Executive shall be entitled to participate
in those employee benefit plans, programs, policies and
arrangements (including fringe benefit and executive perquisite
programs and policies) set forth on Appendix B in accordance with
the terms thereof as they may be in effect from time to time.
- (b)
- Reimbursement of Expenses
. During the Employment Term, the Company shall
reimburse the Executive 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 for
submission of expense reports, receipts or similar documentation of
such expenses applicable to senior management generally.
- 5.
- Annual Leave . For
each whole and partial calendar year during the Employment Term,
the Executive shall be entitled to 28 days of paid vacation
(prorated from the Effective Date and for any partial calendar
year), to be credited and taken in accordance with the Company's
policy as in effect from time to time.
- 6.
- Termination .
- (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 senior
managers. In addition, upon any termination of the Executive's
employment under Sections 6(a),
(b) and (c) during the Employment
Term, the Company shall cause the Executive to be paid any earned
but unpaid portion of the Base Salary and consistent with the
Company's bonus policy then in effect, annual cash bonus, if any.
(The Company's bonus policy may affect the timing of any payment,
the proration factor and may provide for non payment of the 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 6(f) and, following
the expiration of any applicable revocation period, cause the
Executive to be paid a lump-sum severance payment of cash equal to
the Severance Amount. The term " Severance
Amount " means an amount equal to:
- (i)
- for the period from the Effective Date to and
including March 31, 2008, one-half of Base Salary;
- (ii)
- for the period from April 1, 2008 to and
including September 30, 2008, one times Base Salary; and
- (iii)
- for the period from October 1, 2008 and
thereafter, two times Base Salary.
-
-
provided that in the
event the Termination Without Cause or Constructive Termination
Without Cause occurs within three months after the occurrence of a
Change of Control, then the Severance Amount shall be two times
Base Salary. The term "Change of Control means an "Acceleration
Event" under the Company's 2006 Stock Incentive Plan, as amended
from time to time.
- (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 the expiration date. 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 6(f) and
following the expiration of any applicable revocation period, cause
the Executive to be paid a lump-sum severance payment of cash equal
to the product of the Base Salary times one-half ( 1 /
2 ). 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 6(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. 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.
-
- (d)
- Upon any termination of the Executive's
employment during the Employment Term other than by the Company for
Cause, the Executive and his family shall be entitled to continued
medical benefits under (and in accordance with the terms of) the
Company's benefit plans for one year from the date of termination,
less any applicable tax or national contributions.
-
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The severance payments described above shall be
in lieu and inclusive of any salary and other benefits which would
be payable to the Executive in respect of any statutory notice
period in the UK.
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) any material adverse diminution in the Executive's
responsibilities or authorities; or (B) assignment to the
Executive of duties that are inconsistent, in a material respect,
with the scope of duties and responsibilities generally relevant or
associated with his position. 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) or (B) above) has
occurred, and such notice shall describe the facts and
circumstances in support of such claim in reasonable detail. The
Company shall have 10 days thereafter to cure such facts and
circumstances if possible.
- (ii)
- A " Termination Without
Cause " means a termination of the
Executive's employment during the Employment Term by the Company
other than for Cause.
- (iii)
- " Cause
" means (x) the Executive is convicted of, or
pleads guilty or nolo
contendere to, a felony or to any crime
involving fraud, embezzlement or breach of trust; (y) the
willful or continued failure of the Executive to perform the
Executive's duties hereunder (other than as a result of physical or
mental illness); or (z) in carrying out the Executive's duties
hereunder, the Executive has engaged in conduct that constitutes
gross neglect or willful misconduct, unless the Executive believed
in 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 Chief
Executive Officer 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 Chief Executive Officer (if
promptly requested by the Executive) and the Chief Executive
Officer 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)
- Effect of Section 409A of the Internal
Revenue Code. If the Executive is a
"specified employee" on the date of termination of the Executive's
employment for purposes of Section 409A of the Internal
Revenue Code of 1986, as amended, and the regulations there under,
notwithstanding any provision of the Agreement relating to the
timing of payments to the Executive hereunder, if Section 409A
would cause the imposition of the additional tax under
Section 409A if paid as provided in Section 6 of the
Agreement, then as much of the severance payment as may be paid
without the imposition of the additional tax shall be paid in a
lump sum as aforesaid, and any remaining portion of the severance
payment shall be paid upon the day following the six-month
anniversary of the date of termination. For purposes of this
Agreement, " Specified Employee
" shall mean a "specified employee" within the
meaning of Code section 409A(a)(2)(B)(i), as determined by the
Company's Compensation Committee.
-
- (f)
- Release; Full Satisfaction
. Notwithstanding any other provision of this
Agreement, no notice or severance pay shall become payable under
this Agreement unless and until the Executive executes a general
release of claims in form and manner reasonably satisfactory to the
Company and substantially similar to Appendix C , and such release
has become irrevocable (it being the intention of the parties that
the Executive provide the Company with a complete release of any
and all claims as a condition to the receipt of the severance pay
under this Agreement); provided
, that the Executive shall not be required to
release any indemnification rights, continuing rights to benefits
under the Company's employee benefit plans, or rights to future
payments or benefits under this Agreement. The payment of severance
pay to be provided to the Executive pursuant to this Section upon
termination of the Executive's employment shall constitute the
exclusive payment 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 plan, program, policy or other arrangement which
has heretofore been or shall hereafter be established by any member
of the Company Affiliated Group and shall be in respect of any such
claims or payments due or arising from any benefits, rights or
entitlements in any jurisdiction.
- (g)
- Resignation. Upon
termination of the Executive's employment for any reason, the
Executive shall be deemed to have resigned from all positions with
any member of the Company Affiliated Group, as applicable.
- (h)
- Cooperation Following Termination
. Following termination of the Executive's
employment for any reason, the Executive agrees to reasonably
cooperate with the Company upon the reasonable request of the Chief
Executive Officer or Chief Financial Officer of the Company 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 reimburse or, at the
Executive's request, advance the Executive for expenses reasonably
incurred in connection with such matters.
- 7.
- Executive's Representation
. The Executive represents to the Company that the
Executive's execution and performance of this Agreement does not
violate any agreement or obligation (whether or not written) that
the Executive has with or to any person or entity including any
prior employer.
- 8.
- Executive's Covenants .
- (a)
- Confidentiality .
The Executive agrees and understands that the Executive has been,
and in the Executive's position with the Company the Executive will
be, exposed to and receive information relating to the confidential
affairs of the Company Affiliated Group, including without
limitation technical information, business and 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 8(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.
The Executive shall comply with the Company's data protection
policies. 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
-
- (b)
- Non-Competition and
Non-Solicitation . During the period
commencing upon the Effective Date and ending on the eighteen 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, colleague, 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, a busine
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