Articles Of Association

COMPANY NUMBER 2983307


THE COMPANIES ACT 1985 AND 1989


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PUBLIC COMPANY LIMITED BY SHARES


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ARTICLES OF ASSOCIATION


OF


TELEWEST COMMUNICATIONS PLC(1)


(Effective as of 7 July 2000)


PRELIMINARY


INTERPRETATION


1.1 In the articles:


ACT means, unless the context otherwise requires, the Companies Act 1985, including any statutory modification or re-enactment for the time being in force;


ACTS means the Companies Acts 1985 and 1989 and all statutes and subordinate legislation for the time being in force concerning companies so far as they apply to the Company;


APPROVED DEPOSITARY means a custodian or other person (or a nominee for such custodian or other person) appointed under contractual arrangements with the Company or other arrangements approved by the board whereby such custodian or other person or nominee holds or is interested in shares of the Company or rights or interests in shares of the Company and issues securities or other documents of title or otherwise evidencing the entitlement of the holder thereof to or to receive such shares, rights or interests, provided and to the extent that such arrangements have been approved by the board for the purposes of the articles and shall include, where approved by the board, the trustees (acting in their capacity as such) of any employees' share scheme established by the Company or any other scheme or arrangements principally for the benefit of employees of the Company and/or its subsidiaries which have been approved by the Company in general meeting;


ARTICLES means these articles of association as amended from time to time;


AUDITORS means the auditors of the Company;


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1 The Company was incorporated as a public company limited by shares with the
name Amberfrost plc on 20 January 1994. Its name was changed to TeleWest
plc on 7 June 1995 pursuant to a special resolution passed on 7 June 1995,
and to Telewest Communications plc on 16 May 1996 pursuant to a special
resolution passed on 16 May 1996.


BOARD means the board of directors of the Company or the directors present or deemed to be present at a duly convened meeting of the directors at which a quorum is present;


BUSINESS DAY means a day (not being a Saturday or Sunday) on which clearing banks are open for business in London;


CLEAR DAYS means, in relation to a period of notice, that period excluding the day when the notice is given or deemed to be given and the day for which it is given or on which it is to take effect;


COMPANY includes any body corporate (not being a corporation sole) or association of persons, whether or not a company within the meaning of the Act;


DILUTIVE ISSUE means any issue of Shares or other securities (including securities convertible into or exchangeable for Shares or other securities carrying the right to vote at general meetings of the Company's Shareholders) in the capital of the Company in respect of which the Liberty Group or the Microsoft Group (as relevant) was not entitled by the terms of such issue to participate on a pro-rata basis;


DIRECTOR means, unless the context otherwise requires, a director of the Company;


DIVIDEND includes bonus;


ENTITLED BY TRANSMISSION means, in relation to a share, entitled as a consequence of the death or bankruptcy of a member or of another event giving rise to a transmission of entitlement by operation of law;


EXECUTED includes, in relation to a document, execution under hand or under seal or by another method permitted by law;


HOLDER means, in relation to a share, the member whose name is entered in the register as the holder of that share;


INDEPENDENT DIRECTOR means any director who is not designated by the Microsoft Group or the Liberty Group in accordance with article 72 and is not a partner, officer, employee of, or an individual having a material consultancy with, the Liberty Group or the Microsoft Group;


LESSER QUALIFYING INTEREST means:


(a) 7.5% or more of the ordinary shares in issue for the time being; or


(b) following any Dilutive Issue, 5% or more of the ordinary shares in issue
for the time being provided immediately prior to such Dilutive Issue the
Liberty Group or the Microsoft Group (as relevant) held 7.5% or more of the
ordinary shares in issue for the time being;


For the foregoing purposes the percentage of ordinary shares held shall be calculated on the assumption that all ordinary shares issued after 15 April 1998 pursuant to or for the purposes of employee share options shall be ignored;


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LIBERTY means Liberty Media International, Inc., a corporation incorporated under the laws of the State of Delaware, USA;


LIBERTY DESIGNATED DIRECTOR means any director who may be appointed from time to time by a member of the Liberty Group pursuant to article 72.1 provided that a Liberty Designated Director shall automatically cease so to be in the following circumstances:


(a) upon members of the Liberty Group ceasing to hold a Qualifying Interest and
the right to appoint two directors pursuant to article 72, but retaining a
Lesser Qualifying Interest and the right to appoint one director, the
Liberty Designated Director last appointed to the board shall cease so to
be;


(b) upon members of the Liberty Group ceasing to hold a Qualifying Interest or
a Lesser Qualifying Interest and to have the right to appoint a director or
two directors pursuant to article 72, all Liberty Designated Directors
shall cease so to be;


LIBERTY GROUP means at any time TCI and/or Liberty Media Corporation and/or Liberty and/or either of their holding companies, and/or either of their subsidiary undertakings and/or any subsidiary undertakings of either of their holding companies for the time being, and a MEMBER OF THE LIBERTY GROUP shall mean any registered holder of shares beneficially owned by a person within such group, provided always that (save in respect of TW Holdings) no person or group of undertakings within the Liberty Group shall also be within the Microsoft Group. TW Holdings shall be deemed to be a member of the Liberty Group but only to the extent of the number of Pro Rata Shares of Liberty Group. Wherever the articles require or permit the calculation of a number or percentage of ordinary shares held by the Liberty Group such number or percentage shall include the Pro Rata Shares of the Liberty Group;


LIMITED VOTING SHARES mean the limited voting convertible ordinary shares having the rights set out in article 3A;


LONDON STOCK EXCHANGE means the International Stock Exchange of the United Kingdom and the Republic of Ireland Limited;


MICROSOFT means Microsoft Corporation, a corporation incorporated under the laws of Washington;


MICROSOFT DESIGNATED DIRECTOR means any director who may be appointed from time to time by a member of the Microsoft Group pursuant to article 71.2 provided that a Microsoft Designated Director shall automatically cease so to be in the following circumstances:


(a) upon members of the Microsoft Group ceasing to hold a Qualifying Interest
and to have the right to appoint two directors pursuant to article 71, but
retaining a Lesser Qualifying Interest and the right to appoint one
director, the Microsoft Designated Director last appointed to the board
shall cease so to be; and


(b) upon members of the Microsoft Group ceasing to hold a Qualifying Interest
or a Lesser Qualifying Interest and to have the right to appoint a director
or two


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directors pursuant to article 71, all Microsoft Designated Directors shall
cease so to be;


MICROSOFT GROUP means at any time Microsoft and any holding company of Microsoft, and its subsidiary undertakings and any subsidiary undertaking of any such holding company for the time being, and a MEMBER OF THE MICROSOFT GROUP shall mean any registered holder of shares beneficially owned by a person within such group, provided always that (save in respect of TW Holdings) no person or group of undertakings within the Microsoft Group shall also be within the Liberty Group. TW Holdings shall be deemed to be a member of the Microsoft Group but only to the extent of the number of Pro Rata Shares of the Microsoft Group. Wherever the articles require or permit the calculation of a number or percentage of ordinary shares held by the Microsoft Group such number or percentage shall include the Pro Rata Shares of the Microsoft Group;


MEMBER means, unless the context otherwise requires, a member of the Company;


OFFICE means the registered office of the Company;


ORDINARY SHARES means ordinary shares in the capital of the Company (excluding, for the avoidance of doubt, the limited voting shares);


PAID, PAID UP and PAID-UP include credited as paid or paid up;


PRO RATA SHARES means, with respect to any Shareholder Group at any time, the number of ordinary shares held by TW Holdings attributable to such Shareholder Group being the product rounded to the nearest whole number of (x) the sum of the number of ordinary shares held by TW Holdings multiplied by (y) the aggregate percentage ownership interest in TW Holdings, expressed as a decimal, held by members of such Shareholder Group as of such date;


QUALIFYING INTEREST means:


(a) 15% or more of the ordinary shares in issue for the time being; or


(b) following any Dilutive Issue, 12.5% or more of the ordinary shares in issue
for the time being provided that immediately prior to such Dilutive Issue
the Liberty Group or the Microsoft Group (as relevant) held 15% or more of
the ordinary shares in issue for the time being;


For the foregoing purposes the percentage of ordinary shares held shall be calculated on the assumption that all ordinary shares issued after 15 April 1998 pursuant to or for the purposes of employee share options shall be ignored;


RECOGNISED PERSON means a recognised clearing house or a nominee of a recognised clearing house or of a recognised investment exchange which is designated for the purposes of section 185(4) of the Act;


REGISTER means, unless the context otherwise requires, the register of members kept pursuant to section 352 of the Act;


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SEAL means, unless the context otherwise requires, the common seal of the Company or any official or securities seal that the Company may have or may be permitted to have under the Acts;


SECRETARY means the secretary of the Company and includes any assistant or deputy secretary and a person appointed by the board to perform the duties of the secretary;


SHAREHOLDER GROUP means any of the Liberty Group or the Microsoft Group;


SHARES means ordinary shares and limited voting shares;


TCI means Tele-Communications, Inc., a corporation incorporated under the laws of the State of Delaware, USA;


TW HOLDINGS means TW Holdings, L.L.C., a Colorado limited liability company.


1.2 Words and expressions contained in the articles which are not defined in article 1.1 have, unless the contrary is indicated, the same meaning as in the Act, but excluding any statutory modification to the Act not in force at the date of adoption of the articles.


1.3 Where an ordinary resolution of the Company is expressed to be required for any purpose, a special or extraordinary resolution is also effective for that purpose, and where an extraordinary resolution is expressed to be required for any purpose, a special resolution is also effective for that purpose.


1.4 The headings in the articles do not affect the interpretation of the articles.


TABLE A NOT TO APPLY


2. No regulations contained in any statute or subordinate legislation, including the regulations contained in Table A in the schedule to the Companies (Tables A to F) Regulations 1985 (as amended), apply as the regulations or articles of association of the Company.


AUTHORISED CAPITAL


SHARE CAPITAL


3. The authorised share capital of the Company at the date of adoption of the articles is (pound) o divided into o ordinary shares of 10p each and 300,000,000 limited voting convertible ordinary shares of 10p each. The special rights and restrictions attaching to the limited voting convertible ordinary shares are set out in Article 3A.


LIMITED VOTING SHARES


3.A For the purposes of this article 3A:


3.1A CONVERSION NOTICE means the written notice to convert served by the Company under article 3.3A or by a holder of limited voting convertible ordinary shares under article 3.4A;


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CONVERSION RATE means at the rate of one ordinary share for every one limited voting convertible ordinary share; and


CONVERSION DATE means the date on which a conversion notice is received by the registrars for the time being of the Company (the REGISTRARS) together with, in the case of such a notice served by a holder of limited voting convertible ordinary shares, those items referred to in article 3.4A; and


DEBENTURE CHANGE OF CONTROL means a Change of Control as defined in any of (i) the Indenture, dated as of October 3, 1995, between the Company and The Bank of New York, pursuant to which the Company issued its Senior Debentures due 2006, (ii) the Indenture, dated as of October 3, 1995, between the Company and The Bank of New York pursuant to which the Company issued its Senior Discount Debentures due 2007, (iii) the Indenture dated as of November 9, 1998 between the Company and The Bank of New York, pursuant to which the Company issued its Senior Notes due 2008, (iv) the Indenture dated as of February 19, 1999, between the Company and The Bank of New York pursuant to which the Company issued its Senior Convertible Notes due 2007, (v) the Indenture dated as of 15 April, 1999, between the Company and The Bank of New York, pursuant to which the Company issued its Sterling and Dollar Senior Discount Notes due 2009, in each case as in effect at 1 October 1999, and (vi) a document governing any other indebtedness of the Company as agreed in writing in advance by Microsoft and Liberty (the INDENTURES), provided that there shall not be deemed to be any such Change of Control if all of the notes which have been issued pursuant to the Indentures referred to in (i) to (v) prior to 30 September 1999 or pursuant to any document referred to in (vi), have been redeemed, repaid, cancelled or purchased by the Company.


3.2A The ordinary shares and the limited voting shares shall rank pari passu in all respects save that the limited voting shares shall not confer the right to speak or vote on any resolution for the removal, election, appointment or re-appointment of directors and so that save as aforesaid the limited voting shares shall at all times carry the same rights as and be treated as forming one uniform class with the ordinary shares (provided that such shares shall be treated as a separate class in relation to any variation of the rights attached thereto).


3.3A The Company may at any time, upon approval by the board by written notice to all or any of the holders of the limited voting shares convert such holder's or holders' limited voting shares (on a pro-rata basis) into ordinary shares at the conversion rate and, notwithstanding any other provisions of the articles, no Microsoft Designated Director (while a member of the Microsoft Group holds or is interested in limited voting shares) and no Liberty Designated Director (while a member of the Liberty Group holds or is interested in limited voting shares) shall be entitled to vote on any resolution of the board relating to such approval.


3.4A No limited voting shares shall be converted into ordinary shares if such a conversion would result in a debenture change of control. A holder of limited voting shares shall be entitled upon approval by the board to convert all or any of its limited voting shares into fully paid ordinary shares at the conversion rate only if the conditions set out below are satisfied. The holder shall complete a notice of conversion in such form as may from time to time be prescribed by the directors and reasonably acceptable to the holder (which notice may require representations by the holder as to its beneficial


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ownership of ordinary shares and the absence of other arrangements or conditions that might cause such conversion to result in a debenture change of control). Further, the holder shall deliver the same to the Company and the registrars together with (i) such other evidence, if any, as the directors may reasonably require to prove the title of the person exercising such right, and (ii) an opinion reasonably satisfactory to the directors from leading external New York counsel of at least 10 years standing addressed to the Company (at the expense of the Company) stating that such conversion will not result in a debenture change of control. A conversion notice, once given, may not be withdrawn without the consent in writing of the Company. The directors shall approve the conversion of the relevant limited voting shares unless the opinion referred to in (ii) above is not reasonably satisfactory to them in which case they shall notify the holder setting out the reasons for the determination. In connection with any approval under this article 3.4A no Microsoft Designated Director (while a member of the Microsoft Group holds or is interested in limited voting shares) or Liberty Designated Director (while a member of the Liberty Group holds or is interested in limited voting shares) shall be entitled to vote on any resolution of the board relating to such conversion.


3.5A The ordinary shares arising on conversion in accordance with this article 3A shall be credited as fully paid and rank pari passu in all respects with the ordinary shares then in issue and shall entitle the holder to all dividends and other distributions payable on the ordinary shares after the conversion date. Any dividend due but not paid on the relevant conversion date shall instead be payable to the holder of the relevant limited voting share so converted.


3.6A Within 14 days after the relevant conversion date, the Company shall forward to each holder, free of charge, the definitive certificate for the appropriate amount of fully paid ordinary shares and a new certificate for any unconverted limited voting shares comprised in the certificate surrendered by him. In the meantime, transfers will be certified against the register.


3.7A The Company shall use all reasonable efforts to ensure that all the ordinary shares arising from conversion are admitted to the Official List of the London Stock Exchange.


3.8A Conversion of such limited voting shares from time to time may be effected, subject to the articles, by their redesignation and conversion into ordinary shares.


3.9A The Company shall procure that at all times there shall be sufficient unissued ordinary share capital available for the purposes of effecting conversion of all outstanding limited voting shares.


3.10A If any date specified for the conversion of any limited voting shares pursuant to this article 3A would otherwise fall on a day which is not a business day, such date shall be the next following business day.


3.11A The quorum for any meeting of the holders of the limited voting shares shall be two holders of limited voting shares present in person or by proxy or one holder if there be only one such holder. A resolution in writing executed by each member who would have been entitled to vote upon it if it had been proposed at a class meeting at which he was present shall be as effectual as if it had been passed at a class meeting duly


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convened and held and may consist of several instruments in the like form executed by each member.


3.12A On a transfer by any member of the Microsoft Group or any member of the Liberty Group of any limited voting shares to a third party, the shares so transferred shall be converted upon approval by the board into ordinary shares at the conversion rate in accordance with Article 3.8A. The board shall approve any such conversion unless the directors shall have determined to their reasonable satisfaction (including through appropriate representations made by the transferor and/or the third party) that (i) such transferor shall, individually or as part of a group, remain the "beneficial owner" (as defined in the Indentures) of such ordinary shares following the transfer to such third party and (ii) such conversion upon the transfer to such party shall result in a debenture change of control. In making such determination, no Microsoft Designated Director (while a member of the Microsoft Group holds or is interested in limited voting shares) or Liberty Designated Director (while a member of the Liberty Group holds or is interested in limited voting shares) shall be entitled to participate in such board decision.


AUTHORITY TO ALLOT


4.1 Subject to the Acts and relevant authority of the Company in general meeting required by the Acts, the board has general and unconditional authority to allot (with or without conferring rights of renunciation), grant options over, offer or otherwise deal with or dispose of unissued shares (whether forming part of the original or any increased capital), or rights to subscribe for or convert any security into shares, to such persons, at such times and on such terms and conditions as the board may decide but no share may be issued at a discount.


4.2 The board may at any time after the allotment of a share but before a person has been entered in the register as the holder of the share recognise a renunciation of the share by the allottee in favour of another person and may grant to an allottee a right to effect a renunciation on the terms and conditions the board thinks fit.


POWER TO ATTACH RIGHTS


5. Subject to the Acts and to the rights attached to existing shares, new shares may be allotted or issued with or have attached to them such special rights or restrictions as the Company may by ordinary resolution decide, or, if no resolution is passed, as the board may decide.


REDEEMABLE SHARES


6. Subject to the Acts and to the rights attached to existing shares, shares may be issued on terms that they are to be redeemed or, at the option of the Company or the holder, are liable to be redeemed.


VARIATION OF RIGHTS


7.1 Subject to the Acts, the rights attached to a class of shares may be varied whether or not the Company is being wound up (i) in such manner (if any) as may be provided by those rights, or (ii) in the absence of any such provision, either with the consent in writing of the holders of at least three-fourths of the nominal amount of the


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issued shares of that class or with the sanction of an extraordinary resolution passed at a separate meeting of the holders of the issued shares of that class validly held in accordance with the articles, but not otherwise. Any variation of the rights attaching to the limited voting shares shall be deemed to be a variation of the class rights attaching to the ordinary shares and will require a special resolution of the Company (requiring at least three-fourths of the nominal amount of the limited voting shares and ordinary shares then in issue to vote in favour of such resolution).


7.2 The rights attached to a class of shares are not, unless otherwise expressly provided in the rights attaching to those shares, deemed to be varied by the creation or issue of further shares ranking pari passu with or subsequent to them or by the purchase or redemption by the Company of its own shares in accordance with the Acts and article 38.


COMMISSION


8. The Company may exercise all powers conferred or permitted by the Acts of paying commission or brokerage. Subject to the Acts, commission or brokerage may be satisfied by the payment of cash or the allotment of fully- or partly-paid shares or the grant of an option to call for an allotment of shares or by any combination of these methods.


TRUSTS NOT RECOGNISED


9. Except as ordered by a court of competent jurisdiction or as required by law, the Company shall not recognise a person as holding a share on trust and is not bound by or otherwise compelled to recognise (even if it has notice of it) an equitable, contingent, future, partial or other claim to or interest in a share other than an absolute right in the holder to the whole of the share.


SHARE CERTIFICATES


RIGHT TO CERTIFICATE


10.1 Subject to the Acts and the requirements of the London Stock Exchange, a person (except a recognised person in respect of whom the Company is not required by law to complete and have ready for delivery a certificate) on becoming the holder of a share is entitled without charge, to one certificate for all the shares of a class registered in his name or, in the case of shares of more than one class being registered in his name, to a separate certificate for each class of shares.


10.2 Where a member (other than a recognised person) transfers part of his shares comprised in a certificate he is entitled, without charge, to one certificate for the balance of shares retained by him.


10.3 The Company is not bound to issue more than one certificate for shares held jointly by two or more persons and delivery of a certificate to one joint holder is sufficient delivery to all joint holders.


10.4 A certificate shall specify the number and class and the distinguishing numbers (if any) of the shares in respect of which it is issued and the amount paid up on the


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shares. It shall be issued under a seal, which may be affixed to or printed on it, or in such other manner as the board may approve, having regard to the terms of issue and the requirements of the London Stock Exchange.


REPLACEMENT CERTIFICATES


11.1 Where a member holds two or more certificates for shares of one class, the board may at his request, on surrender of the original certificates and without charge, cancel the certificates and issue a single replacement certificate.


11.2 At the request of a member, the board may cancel a certificate and issu ...