Virgin Media 2010 Annual Report Download - page 144

VIRGIN MEDIA INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
Note 15—Related Party Transactions (continued)
During the first quarter of 2010, ntl:Telewest Business announced that it would rebrand using the Virgin
trade marks to “Virgin Media Business”. Virgin Media has entered into a trade mark license with Virgin
Enterprises Ltd under which an annual royalty is payable of 0.25% of revenues from our business division,
subject to a minimum payment of £1.5 million.
During the years ended December 31, 2010, 2009 and 2008, respectively, we incurred expenses of
£10.1 million, £9.0 million, and £8.9 million for charges in respect of brand licensing and promotion of which
£4.7 million and £2.3 million was payable at December 31, 2010 and 2009, respectively.
Other Virgin Companies
As a licensee of the “Virgin” brand name, we participate in mutually beneficial activities with other Virgin
companies. These arrangements are in the ordinary course of business and believed to be on arm’s length terms.
UKTV Joint Ventures
Through our wholly owned subsidiary, Flextech Broadband Limited, we own a 50% equity investment in
the UKTV joint venture companies. We have therefore identified the UKTV joint venture companies as related
parties to us. We also carry the UKTV channels in our pay television packages available to our customers.
As at December 31, 2010 and 2009, included in the balance sheet were amounts related to our share of net
assets, loans receivable, redeemable preference shares, and other payables and receivables in respect of the
UKTV joint ventures totaling £359.2 million and £359.9 million, respectively.
We pay UKTV for purchases of television programming rights and receive payments in respect of
advertising and other business support services provided to UKTV. During the years ended December 31, 2010,
2009 and 2008, the net expense recognized in respect to these transactions through the consolidated statement of
operations totaled £24.8 million, £24.3 million and £22.1 million, respectively. These amounts are settled on a
net basis at regular intervals.
During the years ended December 31, 2010, 2009 and 2008, we received cash payments from UKTV for
loan principal payments, interest, dividends and consortium tax relief totaling £34.4 million, £21.1 million and
£46.7 million, respectively.
Note 16—Shareholders’ Equity
Authorized Share Capital
Our authorized share capital for issuance consists of one billion shares of common stock, 300.0 million
shares of Class B redeemable common stock and five million shares of preferred stock with a par value of $0.01
each. As at December 31, 2010 there were 322.0 million shares of common stock outstanding, and no Class B
redeemable common stock or preferred stock outstanding. The common stock is voting with rights to dividends
as declared by the Board of Directors.
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