Virgin Media 2012 Annual Report Download - page 86

F-15
Each of these instruments are excluded from the calculation of diluted net income per common share in periods in
which there is a loss, because the inclusion of potential common shares would have an anti-dilutive effect.
In the year ended December 31, 2012, certain share based awards to employees have been excluded from the
calculation of the diluted weighted average number of shares because their exercise prices exceeded our average
share price during the calculation period.
In the year ended December 31, 2012, certain restricted stock held in escrow and certain restricted stock units have
been excluded from the calculation of the diluted weighted average number of shares because these shares are
contingently issuable based on the achievement of performance and/or market conditions that have not been achieved
as of December 31, 2012.
Stock Option Grants
All options outstanding under our stock incentive plans have a ten year term and become fully exercisable within five
years of continued employment. We generally issue new shares upon exercise of the options and expect to continue
to do so. For performance-based option grants, the performance objectives are based upon both quantitative and
qualitative objectives, including earnings and stock price performance, amongst others. These objectives may be
absolute or relative to prior performance or to the performance of other entities, indices or benchmarks and may be
expressed in terms of progression within a specific range.
Sharesave Option Grants
All options granted under the Virgin Media Inc. Sharesave Plan enable eligible employees to purchase shares of our
common stock at a discount. Employees are invited to take out savings contracts that last for three years. At the end
of the contract, employees use the proceeds of these savings to exercise the options granted under the plan. We
intend to issue new shares upon exercise of the options.
Restricted Stock Grants
The shares of restricted stock granted under our stock incentive plans have a restrictions for up to ten years and vest
based on time or performance, subject to continued employment. For performance-based restricted stock grants, the
performance objectives are based upon quantitative and qualitative objectives, including earnings, operational
performance and achievement of strategic goals, amongst others, and vest after a one to three year period. These
objectives may be absolute or relative to prior performance or to the performance of other entities, indices or benchmarks
and may be expressed in terms of progression within a specific range.
Restricted Stock Unit and Performance Share Grants
The restricted stock units and performance shares granted under our stock incentive plans have a term of up to ten
years and vest based on performance, subject to continued employment. The performance targets include stock price
performance, earnings and cash flows and may be absolute or relative to prior performance or to the performance of
other entities, indices or benchmarks and may be expressed in terms of progression within a specific range.
Convertible Notes
Holders of our U.S. dollar denominated 6.50% convertible senior notes due 2016 may tender their notes for conversion
at any time on or after August 15, 2016 through to the second scheduled trading date preceding the maturity date.
Prior to August 15, 2016, holders may convert their notes, at their option, only under the following circumstances: (i) in
any quarter, if the closing sale price of Virgin Media Inc.'s common stock during at least 20 of the last 30 trading days
of the prior quarter was more than 120% of the applicable conversion price per share of common stock on the last day
of such prior quarter; (ii) if, for five consecutive trading days, the trading price per $1,000 principal amount of notes
was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate;
(iii) if a 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
Table of Contents
VIRGIN MEDIA INC. AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
Note 3—Earnings Per Share (continued)