Virgin Media 2009 Annual Report Download - page 86

specified corporate event occurs, such as a merger, recapitalization, reclassification, binding share
exchange or conveyance of all, or substantially all, of Virgin Media Inc.’s assets; (iv) the declaration by
Virgin Media Inc. of the distribution of certain rights, warrants, assets or debt securities to all, or
substantially all, holders of Virgin Media Inc.’s common stock; or (v) if Virgin Media Inc. undergoes a
fundamental change (as defined in the indenture governing the convertible senior notes), such as a
change in control, merger, consolidation, dissolution or delisting.
The initial conversion rate of the convertible senior notes represents an initial conversion price of
approximately $19.22 per share of common stock. The conversion rate is subject to adjustment for
stock splits, stock dividends or distributions, the issuance of certain rights or warrants, certain cash
dividends or distributions or stock repurchases where the price exceeds market values. In the event of
specified fundamental changes relating to Virgin Media Inc., referred to as ‘‘make whole’’ fundamental
changes, the conversion rate will be increased as provided by a formula set forth in the indenture
governing the convertible senior notes.
Holders may also require us to repurchase the convertible senior notes for cash in the event of a
fundamental change (as defined in the indenture governing the convertible senior notes), such as a
change in control, merger, consolidation, dissolution or delisting (including involuntary delisting for
failure to continue to comply with the NASDAQ listing criteria), for a purchase price equal to 100% of
the principal amount, plus accrued but unpaid interest to the purchase date.
Debt Ratings
To access public debt capital markets, we rely on credit rating agencies to assign corporate credit
ratings. A rating is not a recommendation by the rating agency to buy, sell or hold our securities. A
credit rating agency may change or withdraw our ratings based on its assessment of our current and
future ability to meet interest and principal repayment obligations. Lower credit ratings generally result
in higher borrowing costs and reduced access to debt capital markets. The corporate debt ratings and
outlook assigned by the rating agencies engaged by us as of December 31, 2009 are as follows:
Corporate
Rating Outlook
Moody’s Investors Service Inc. ............................ Ba3 Stable
Standard & Poor’s ..................................... B+ Stable
Fitch ............................................... BBǁPositive
Off-Balance Sheet Arrangements
As part of our ongoing business we have not participated in transactions that generate
relationships with unconsolidated entities or financial partnerships, such as entities frequently referred
to as special purpose entities, or SPEs, which would have been established for the purpose of
facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. As of
December 31, 2009, we were not involved with any material unconsolidated SPEs.
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