Virgin Media 2008 Annual Report Download - page 40

We may in the future seek to raise funds through equity offerings, which could have a dilutive effect on our
common stock.
In the future, we may determine to raise capital through offerings of our common stock, securities
convertible into our common stock, or rights to acquire these securities or our common stock. In any
case, the result would ultimately be dilutive to our common stock by increasing the number of shares
outstanding. We cannot predict the effect this dilution may have on the price of our common stock.
We may not continue to pay dividends, and the failure to do so could adversely affect our stock price.
Until June 2006, we had not paid any cash dividends on our common stock. We could determine
not to continue to pay dividends on our common stock at the same level, or at all. In addition, the
terms of our existing indebtedness limit the amount of dividends we can pay to stockholders from cash
generated from operations if our debt leverage ratio is above certain levels.
Sales of stock by stockholders in the company may decrease the price of the common stock.
Based on SEC filings as of February 24, 2009, Fidelity Management & Research Company
beneficially owns 14.9% of our issued and outstanding common stock, the Virgin Group beneficially
owns 10.4%, Franklin Mutual Advisers, LLC beneficially owns 9.2%, Wellington Management Company
beneficially owns 8.6%, Ameriprise Financial, Inc. beneficially owns 6.9%, Capital World Investors
beneficially owns 5.9% and Goldman Sachs Asset Management, LP beneficially owns 5.2%, of our
issued and outstanding common stock. In addition, several of our significant stockholders are hedge
funds, which often engage in aggressive trading strategies, such as short selling, and trade large volumes
of securities opportunistically based on market conditions. In the current economic environment, hedge
and other funds are also experiencing increased levels of redemption by their investors. Any significant
sales of our stock held by these investors could have an adverse effect on the market price of our
shares.
Some of our stockholders also have rights, subject to various conditions, to require the company to
file one or more registration statements covering their shares, or to include their shares in registration
statements that the company may file for itself or on behalf of other stockholders.
Subsequent sales by any stockholders of a substantial amount of the company’s common stock may
significantly reduce the market price of the common stock of the company. Moreover, a perception that
these stockholders might sell significant amounts of such common stock could depress the trading price
of the company’s common stock for a considerable period. Sales of the company’s common stock, and
the possibility of these sales, could make it more difficult for the company to sell equity, or equity
related securities, in the future at a time, and price, that it considers appropriate.
Provisions of our debt agreements, our stockholder rights plan, our certificate of incorporation, Delaware law
and our contracts could prevent or delay a change of control of us.
We may, under some circumstances involving a change of control, be obligated to repurchase
substantially all of our outstanding senior notes and convertible senior notes, and repay our outstanding
indebtedness under our senior credit facility and other indebtedness. We or any possible acquirer may
not have available financial resources necessary to repurchase those notes or repay that indebtedness in
those circumstances.
If we or any possible acquirer cannot repurchase those notes or repay our indebtedness under our
senior credit facility and other indebtedness in the event of a change of control of us, the failure to do
so would constitute an event of default under the agreements under which that indebtedness was
incurred and could result in a cross-default under other indebtedness that does not have similar
provisions. The threat of this could have the effect of delaying or preventing transactions involving a
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