<PAGE> 1
As filed with the Securities and Exchange Commission on March 29, 1994.
Registration Statement No. _____________
________________________________________________________________________________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
____________________
HOME SHOPPING NETWORK, INC.
(Exact name of registrant as specified in its charter)
Delaware 59-2649518
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) No.)
11831 30th Court North
St. Petersburg, Florida 33716
(Address, including zip code, of registrant's principal executive offices)
____________________
STOCK OPTION AGREEMENT
BETWEEN HOME SHOPPING NETWORK, INC.
AND FRANCIS SANTANGELO
STOCK OPTION AGREEMENT
BETWEEN HOME SHOPPING NETWORK, INC.
AND VERNON J. TROUPE
EMPLOYMENT AGREEMENT
BETWEEN HOME SHOPPING NETWORK, INC.
AND GERALD F. HOGAN
(Full title of the Plans)
____________________
H. Steven Holtzman, Esq.
Senior Counsel
2501 118th Avenue North
St. Petersburg, Florida 33716
(813) 572-8585
(Name, address, including zip code, and telephone number
including area code, of agent for service)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
Title of Securities Amount to be Proposed Maximum Proposed Maximum Amount of
to be Registered Registered Offering Price Aggregate Registration Fee
Per Share Offering Price
<S> <C> <C> <C> <C>
Common Stock 1,104,876 (1) $13.3125(2) $14,708,662 $5,072
Shares
- --------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 2
(1) Includes 984,876 shares underlying stock appreciation rights ("SARs").
The exact number of shares of Home Shopping Network, Inc. common
stock, $.01 par value ("Common Stock") to be issued upon exercise
cannot be presently determined, but is expected to be fewer than the
amount registered hereunder.
(2) The average of the high and low reported sale prices of the Common
Stock on March 25, 1994 has been used for the purpose of calculating
the registration fee pursuant to Rule 457(c).
2
<PAGE> 3
Item 3. Incorporation of Documents by Reference
The following documents filed by Home Shopping Network, Inc. (the
"Company") with the U.S. Securities and Exchange Commission ("SEC") are
incorporated as of their respective dates in this Registration Statement by
reference:
1. Annual Report on Form 10-K for the year ended December 31, 1993.
2. All other reports filed pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 ("Exchange Act") since December 31,
1993.
3. The description of the Company's Common Stock contained in the
Company's registration statement filed pursuant to Section 12 of the
Exchange Act and all amendments thereto or reports filed for the
purpose of updating such description.
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference into this Registration Statement and to be a
part hereof from the date of filing of such documents. The Company will
provide, without charge, to each person to whom this Registration Statement is
delivered, upon written or oral request, (1) a copy of any information that has
been incorporated by reference, other than exhibits to such documents (unless
such exhibits are specifically incorporated by reference into the documents
which this Registration Statement incorporates) and (2) a copy of the Company's
most recent Annual Report to Stockholders. Requests should be directed to
Kevin J. McKeon, Senior Vice President of Accounting and Finance, Home Shopping
Network, Inc., P.O. Box 9090, Clearwater, Florida 34618-9090.
Item 4. Description of Securities
The authorized capital stock of the Company consists of 150,000,000
shares of Common Stock; 24,159,456 shares of Class B common stock, par value
$.01 ("Class B Common Stock"); and 500,000 shares of Preferred Stock, $.01 par
value. On March 18, 1994, a total of 73,920,285 shares of Common Stock (net of
shares held in treasury), and 20,000,000 shares of Class B Common Stock were
outstanding and are fully paid and non-assessable and have no preemptive rights.
Common Stock
The holders of both classes of Common Stock are entitled to receive
such dividends, if any, as may be declared by the Board of
3
<PAGE> 4
Directors out of funds legally available for the payment of dividends. The
current policy of the Board of Directors, however, is to retain earnings for
the growth of the Company. In the event of the liquidation, dissolution or
winding up of the Company, the holders of both classes of Common Stock are
entitled to share ratably in all assets of the Company remaining after
provision for payment of liabilities. Shares of Class B Common Stock are
convertible at the option of the holder into shares of Common Stock of the
Company on a share for share basis. Upon conversion of the Class B Common
Stock, the shares of Class B Common Stock so converted will be retired and are
not subject to reissue.
Each outstanding share of Class B Common Stock is entitled to ten
votes per share and the holders of Class B Common Stock vote together with the
holders of Common Stock on all matters submitted to stockholders except for the
election of 25% of the Board of Directors. Holders of Common Stock have the
right to elect, and the holder of Class B Common Stock has no vote with respect
to, 25% of the entire Board of Directors, rounded upward to the nearest whole
number of directors. As to the election of the remaining directors, the holder
of Class B Common Stock is entitled to ten votes for each share of Class B
Common Stock, and the holders of the Common Stock are entitled to one vote per
share. There are no cumulative voting rights.
By reason of its ownership of all of the outstanding shares of Class B
Common Stock, Liberty HSN, Inc. ("LHSNI"), a Wyoming corporation and a wholly
owned subsidiary of Liberty Media Corporation, a Delaware corporation, may
elect the directors of the Company other than the 25% of the Board which is
reserved for election by the holders of Common Stock. The difference in voting
rights described above also would enable LHSNI to be able to block any
takeover attempt directed at the Company.
Preferred Stock
No Preferred Stock is presently outstanding and none will be issued as
a result of this offering. Preferred Stock may be issued from time to time in
one or more series. The Board of Directors is authorized to determine the
relative rights, preferences and restrictions granted to and imposed upon any
unissued series of the Preferred Stock and the designation of such series.
Preferred Stock may be issued with rights, preferences and restrictions
designed to prevent a takeover of the Company.
Stock Appreciation Rights
Effective as of February 23, 1993, Gerald F. Hogan, President and
Chief Executive Officer of the Company, entered into a four-year employment
agreement with the Company which is automatically renewable for successive one
year terms unless either party provides 180 days written notice to the other
party. Pursuant to
4
<PAGE> 5
the agreement, Mr. Hogan received SARs with respect to 984,876 shares of the
Company's Common Stock at an exercise price of $8.25 per share. The SARs vest
over a four year period with one-fourth of the SARs vesting on each
anniversary of the effective date commencing with February 23, 1994. The SARs
are exercisable in whole or in part until February 23, 2003 unless terminated
earlier. The SARs will vest upon termination of employment other than for
cause and will be exercisable for up to one year following the termination of
employment. In the event of a change in control, whether or not Mr. Hogan has
elected to terminate his employment, all unvested SARs will vest immediately
prior to the change in control so that all SARs may be exercised no later than
the time at which the change in control becomes effective. In the event Mr.
Hogan's employment is terminated following a change in control, the vested SARs
shall remain exercisable for a one year period following such termination. Upon
exercise of a vested SAR, Mr. Hogan could receive cash in an amount equal to the
excess of the fair market value of each share of Common Stock over $8.25. As
long as the Company is a public company, Mr. Hogan may elect to receive stock
in lieu of the cash exercise value of SARs. In the event the Company ceases to
be a public company, SARs may not be exercised on more than three separate
occasions and may not be exercised more than once in any fiscal year of the
Company during the period in which the Company is not a public company. The
SARs also will vest in the event of death or disability and shall remain
exercisable for a one-year period. In the event of a stock dividend,
recapitalization, reorganization, split-up, spin-off, combination, exchange of
shares, warrants or rights offering to purchase Common Stock or other similar
corporate event, appropriate adjustments will be made to the number and kind of
shares subject to SARs and to the strike price of the SARs. SARs may be
exercised by delivery to the Company of a written notice specifying the whole
number of shares of Common Stock as to which SARs are being exercised. A change
in control will be deemed to occur if Liberty ceases to be the sole beneficial
owner of the Company's voting securities having a majority of the outstanding
voting power of the Company or if Liberty experiences a change in control.
Transfer Agent and Registrar
The transfer agent and registrar for the Company's Common Stock is
Bank of New York.
New York Stock Exchange Listing
The Company's Common Stock is listed on the New York Stock Exchange.
Item 5. Interests of Named Experts and Counsel
(Not Applicable)
Item 6. Indemnification of Directors and Officers
Subsection (a) of Section 145 of the General Corporation Law of the
State of Delaware empowers a corporation to indemnify any
5
<PAGE> 6
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the corporation) by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or a proceeding, had no
reasonable cause to believe his conduct was unlawful.
Subsection (b) of Section 145 empowers a corporation to indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, or suits by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that such
person acted in any of the capacities set forth above, against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted
under similar standards, except that no indemnification may be made in respect
of any claim, issue or matter as to which such person shall have been adjudged
to be liable to the corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.
Section 145 further provides that to the extent a director or officer
of a corporation has been successful on the merits or otherwise in the defense
of any action, suit or proceeding referred to in subsections (a) and (b) of
Section 145 in the defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection therewith; that indemnification
provided for by Section 145 shall not be deemed exclusive of any other rights
to which the indemnified party may be entitled; and empowers the corporation to
purchase and maintain insurance on behalf of a director or officer of the
corporation against any liability asserted against him and incurred by him in
any such capacity, or arising out of his status as such whether or not the
corporation would have the power to indemnify against such liabilities under
Section 145.
6
<PAGE> 7
The Restated Certificate of Incorporation of the Company provides the
Company with the authority to indemnify directors, officers, employees and
agents of the Company to the full extent allowed by the laws of the State of
Delaware as those laws exist now or as they may hereafter be amended. In
addition, the stockholders of the Company have approved the execution by the
Company of indemnification agreements with directors and officers to the same
extent as would otherwise be available to the indemnified parties if the
Company had directors and officers liability insurance. Indemnification
agreements have been executed by the Company and each member of the Board of
Directors and certain officers of the Company.
See Item 9 for the Company's undertaking with respect to
indemnification.
Item 7. Exemption from Registration Claimed.
(Not Applicable)
Item 8. Exhibits
4.1 Stock Option Agreement Between Home Shopping Network, Inc. and
Francis Santangelo
4.2 Stock Option Agreement between Home Shopping Network, Inc. and
Vernon J. Troupe
4.3 Employment Agreement between Home Shopping Network, Inc. and Gerald
F. Hogan
5 Opinion of Baker & McKenzie
23.1 Consent of KPMG Peat Marwick
23.2 Consent of Deloitte & Touche
24 Powers of Attorney (set forth on Signature page).
Item 9. Undertakings
The undersigned registrant hereby undertakes:
(a) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a) (3) of the
1933 Act;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of this registration statement (or the most recent
post-effective amendment thereof) which,
7
<PAGE> 8
individually or in the aggregate, represent a fundamental change in the
information set forth in this registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement.
Provided, however, that paragraphs (a)(i) and (a)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(b) That, for the purpose of determining any liability under the 1933
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination
of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act that is incorporated by reference in the Registration Statement shall be
deemed to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
The undersigned registrant hereby undertakes to deliver or cause to be
delivered with the Prospectus, to each person to whom the Prospectus is sent or
given, the latest annual report to security holders that is incorporated by
reference in the Prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X are not set forth in the Prospectus, to deliver, or
cause to be delivered to each person to whom the Prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the Prospectus to provide such interim financial information.
Insofar as indemnification for liabilities under the 1933 Act may be
permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions or otherwise, the registrant has been
advised that in the opinion of the SEC such indemnification is against public
policy as expressed in the 1933
8
<PAGE> 9
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question of
whether such indemnification by it is against public policy as expressed in the
1933 Act and will be governed by the final adjudication of such issue.
9
<PAGE> 10
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of St. Petersburg, State of Florida, on this 29th day of
March, 1994.
HOME SHOPPING NETWORK, INC.
By: /s/ Gerald F. Hogan
-------------------------------
President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints each of Gerald F. Hogan and Kevin J. McKeon, his
true and lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments, including post-effective
amendments, to this Registration Statement and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission and any other regulatory authority, granting
unto said attorney-in-fact and agent, full power and authority to do and
perform each and every act and thing requisite and necessary to be done in and
about the premises, as fully to all intents and purposes as he might or could
do in person, hereby ratifying and confirming all that said attorney-in-fact
and agent, or his substitute, may lawfully do or cause to be done by virtue
hereof.
<TABLE>
<S> <C> <C>
/s/ Gerald F. Hogan President, Chief March 29, 1994
- ------------------- Executive Officer and ---------------------
Gerald F. Hogan Director (Principal
Executive Officer)
/s/ Kevin J. McKeon Senior Vice President March 29, 1994
- ------------------- of Accounting & Finance ---------------------
Kevin J. McKeon (Principal Financial
and Accounting Officer)
</TABLE>
10
<PAGE> 11
<TABLE>
<S> <C> <C>
/s/ Robert R. Bennett Director March 4, 1994
- --------------------- ------------------
Robert R. Bennett
/s/ John M. Draper Director March 4, 1994
- ---------------------- ------------------
John M. Draper
/s/ J. Anthony Forstmann Director March 4, 1994
- ------------------------ ------------------
J. Anthony Forstmann
/s/ Leo J. Hindery, Jr. Director March 4, 1994
- ----------------------- ------------------
Leo J. Hindery, Jr.
/s/ George C. McNamee Director March 4, 1994
- --------------------- ------------------
George C. McNamee
</TABLE>
11
<PAGE> 12
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT PAGE
------- ----------------------- ----
4.1 Stock Option Agreement between 14
Home Shopping Network, Inc. and
Francis Santangelo
4.2 Stock Option Agreement between 18
Home Shopping Network, Inc. and
Vernon J. Troupe
4.3 Employment Agreement between Home 20
Shopping Network, Inc. and
Gerald F. Hogan
5 Opinion of Baker & McKenzie 39
23.1 Consent of KPMG Peat Marwick 41
23.2 Consent of Deloitte & Touche 43
24 Powers of Attorney (set forth on
Signature page).
12
<PAGE> 1
EXHIBIT 4.1
STOCK OPTION AGREEMENT
AGREEMENT between HOME SHOPPING NETWORK, INC., a Delaware corporation
(the "Company"), and FRANCIS SANTANGELO, a consultant to the Company (the
"Santangelo").
WHEREAS, on September 25, 1990, the Board of Directors of the Company
granted to Santangelo certain stock options as a consultant to the Company;
WHEREAS, subsequent actions of the Board of Directors and the
Compensation/Benefits Committee of the Board of Directors amended certain terms
of the option;
WHEREAS, the Company and Santangelo desire to enter into an agreement
setting forth the terms of the option, as amended through the date hereof;
NOW, THEREFORE, the Company and Santangelo agree as follows:
1. STOCK OPTION GRANT. This Agreement evidences the grant
of an option (the "Option") to purchase shares of Common Stock of the Company
subject to the terms and conditions of this Agreement.
2. DATE OF GRANT. The grant of the Option is effective as
of September 25, 1990 and the Option shall be exercisable as provided in this
Agreement.
3. NUMBER AND PRICE OF SHARES. The number of shares subject
to the Option is One Hundred Thousand (100,000). The purchase price per share
of Common Stock is $4.405 as of the date of this Agreement.
4. OPTION PERIOD AND TIME OF EXERCISE. The number of shares
specified in paragraph three above are divided into five parts which may be
exercisable within the option period as follows:
<TABLE>
<CAPTION>
Date On and Date Before
After Which Which Part
Number Part is Must be
Part of Shares Exercisable Exercised
---- --------- ----------- ---------
<S> <C> <C> <C>
1 20,000 September 25, 1991 September 25, 1996
2 20,000 September 25, 1992 September 25, 1997
3 20,000 September 25, 1993 September 25, 1998
4 20,000 September 25, 1994 September 25, 1999
5 20,000 September 25, 1995 September 25, 2000
</TABLE>
(i) Subject to subparagraph (ii) below, upon the termination of
the consulting arrangement for any reason, options granted hereunder shall be
canceled only to the extent that such options were not exercisable as of the
date of such termination.
<PAGE> 2
(ii) Following both (a) a change in control of the Company after
March 17, 1992 and (b) the termination of Santangelo's consulting arrangement
with the Company at any time subsequent to March 17, 1992 for reasons other
than "just cause", as defined below, such Option shall immediately become
exercisable and fully vested with respect to all of the shares of Common Stock
subject to such Option and such fully-vested option shall be exercisable for a
five year period. The exercise period for any previously vested option shall
not be extended by this paragraph. A change in control shall be deemed to have
occurred if (i) the Company is merged or consolidated with another entity (the
"Merger Partner") and as a result of such merger or consolidation less than 15%
of the outstanding voting securities of the surviving or resulting entity shall
be owned in the aggregate by the former control shareholder of the Company, or
(ii) in the event that any person, other than an owner of Class B Common Stock
of the Company on June 16, 1992, becomes the beneficial owner, either directly
or indirectly, of more than 50% of the total votes of issued and outstanding
shares of Common Stock and Class B Common Stock, if any, of the Company, when
computed together. Termination for "just cause" shall be limited to a
termination resulting from an act or acts of dishonesty constituting gross
malfeasance, common law fraud or a felony and which act or acts result, or are
intended to result directly or indirectly, in the gain or personal enrichment
of the option holder at the expense of the Company. The burden of proof to
establish just cause shall be on the Company. Any dispute concerning whether a
termination has been for just cause shall be settled by arbitration in Tampa,
Florida pursuant to the commercial arbitration rules of the American
Arbitration Association. If any action in any arbitration proceeding or any
court is necessary to enforce or interpret the terms of this paragraph, the
prevailing party shall be entitled to actual attorneys' fees, costs and
necessary disbursements in addition to any other relief to which such party may
be entitled.
(iii) In no event shall the option be exercisable after the
expiration date of the option period.
5. MANNER OF EXERCISE. Subject to the conditions and
restrictions contained in paragraph 6 below, the Option shall be exercised by
delivering written notice of exercise to the Secretary of the Company. Such
notice is irrevocable and must be accompanied by payment in cash or such other
form as the Company may approve.
6. NON-TRANSFERABILITY. This Agreement and the option
granted may not be assigned or transferred by Santangelo.
7. ADJUSTMENT IN THE EVENT OF CHANGE IN STOCK. In the event
of any change in the outstanding Common Stock of the Company due to stock
dividends, recapitalizations, reorganizations, mergers, consolidations,
split-ups, combinations or exchanges of shares, the number and kind of shares
under the Option and the purchase price per share will be appropriately
adjusted consistent with such
<PAGE> 3
change. The determination of the Company regarding any adjustment will be
final and conclusive.
8. AMENDMENT. Neither this Agreement nor the Option may be
amended or modified or revoked except by agreement in writing and signed by the
Company and Santangelo.
9. ENTIRE AGREEMENT. This Agreement constitutes the entire
Agreement between the Company and Santangelo with respect to the Option and
supersedes all other agreements heretofore entered into.
IN WITNESS WHEREOF, the Company and Santangelo have executed this
Agreement as of the 29th day of July, 1993.
HOME SHOPPING NETWORK, INC.
By: /s/ Gerald F. Hogan
------------------------------------
/s/ Francis R. Santangelo
------------------------------------
Francis Santangelo
<PAGE> 1
EXHIBIT 4.2
STOCK OPTION AGREEMENT
AGREEMENT between HOME SHOPPING NETWORK, INC., a Delaware corporation
(the "Company"), and VERNON J. TROUPE, a consultant to the Company (the
"Troupe").
WHEREAS, in connection with the spin-off of the Company's subsidiary,
Precision Systems, Inc., on July 31, 1992, the Company agreed to retain the
services of Vernon J. Troupe as a consultant to the Company;
WHEREAS, in connection with the consulting arrangement, the Company
agreed to grant to Troupe certain stock options;
WHEREAS, the Company and Troupe desire to enter into an agreement
setting forth the terms of the option as of the date hereof;
NOW, THEREFORE, the Company and Troupe agree as follows:
1. STOCK OPTION GRANT. This Agreement evidences the grant
of an option (the "Option") to purchase shares of Common Stock of the Company
subject to the terms and conditions of this Agreement.
2. DATE OF GRANT. The grant of the Option is effective as
of December 15, 1992 and the Option shall be exercisable as provided in this
Agreement.
3. NUMBER AND PRICE OF SHARES. The number of shares subject
to the Option is Twenty Thousand (20,000). The purchase price per share of
Common Stock is $5.448 as of the date of this Agreement.
4. OPTION PERIOD AND TIME OF EXERCISE. The number of shares
specified in paragraph three above may be exercisable on or after December 15,
1992 and before December 15, 1997. In no event shall the option be exercisable
after the expiration date of the option period.
5. MANNER OF EXERCISE. Subject to the conditions and
restrictions contained in paragraph 6 below, the Option shall be exercised by
delivering written notice of exercise to the Secretary of the Company. Such
notice is irrevocable and must be accompanied by payment in cash or such other
form as the Company may approve.
6. NON-TRANSFERABILITY. This Agreement and the option
granted may not be assigned or transferred by Troupe.
7. ADJUSTMENT IN THE EVENT OF CHANGE IN STOCK. In the event
of any change in the outstanding Common Stock of the Company due to stock
dividends, recapitalizations, reorganizations, mergers, consolidations,
split-ups, combinations or exchanges of shares, the
<PAGE> 2
number and kind of shares under the Option and the purchase price per share
will be appropriately adjusted consistent with such change. The determination
of the Company regarding any adjustment will be final and conclusive.
8. AMENDMENT. Neither this Agreement nor the Option may be
amended or modified or revoked except by agreement in writing and signed by the
Company and Troupe.
9. ENTIRE AGREEMENT. This Agreement constitutes the entire
Agreement between the Company and Troupe with respect to the Option and
supersedes all other agreements heretofore entered into.
IN WITNESS WHEREOF, the Company and Troupe have executed this
Agreement this _____day of September, 1993.
HOME SHOPPING NETWORK, INC.
By: /s/ Gerald F. Hogan
------------------------------------
Gerald F. Hogan, President and
Chief Executive Officer
/s/ Vernon J. Troupe
------------------------------------
Vernon J. Troupe
<PAGE> 1
EXHIBIT 4.3
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated as of February 23, 1993 between HOME
SHOPPING NETWORK, INC., a Delaware corporation (the "Company"), and GERALD F.
HOGAN ("Executive").
This Agreement sets forth the terms and conditions of Executive's
employment by the Company as the Company's President and Chief Executive
Officer.
In consideration of the mutual covenants and agreements herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties, intending to be
legally bound, do hereby agree as follows:
1. Term and Termination.
(a) Term. The term of Executive's employment under this
Agreement (the "Employment Term") shall commence on the date hereof (the
"Effective Date") and end on the fourth anniversary of such date. The
Employment Term shall be automatically extended beyond the original four year
term for successive one year terms unless at least one hundred eighty (180)
days prior to the expiration of the original Employment Term or any subsequent
renewal thereof, either party notifies the other party in writing that it is
electing to terminate this Agreement at the expiration of the then current
term. During the Employment Term, the Company agrees to employ Executive and
Executive agrees to serve the Company upon and subject to the terms and
conditions set forth in this Agreement.
(b) Termination by the Company. Executive's employment by the
Company may be terminated by the Company only as provided in clauses (i), (ii),
(iii) and (iv) below.
(i) Upon the death of Executive.
(ii) Upon six (6) months' prior written notice from the
Company to Executive (the "Notice Period"), in the event of an illness
or other disability which has incapacitated Executive from performing
his duties hereunder, as determined in good faith by the Board of
Directors of the Company, for an aggregate of one hundred eighty (180)
consecutive days during the twelve calendar months preceding the month
in which such notice is given; provided, however, that in the event
that prior to the end of the Notice Period, Executive recovers from
such illness or other disability to an extent permitting him to perform
his duties hereunder, the notice of termination pursuant to this clause
(ii) shall be of no further force and effect.
<PAGE> 2
(iii) At any time upon giving written notice of such
termination to Executive and by paying Executive in a lump sum upon such
termination an amount equal to (x) Annual Base Salary (as hereinafter
defined) that would have been payable to Executive had his employment by
the Company continued until the expiration of the Employment Agreement
plus (y) the amount of Annual Bonus (as hereinafter defined) that
Executive would have been entitled to receive had his employment by the
Company continued until the end of the fiscal year in which such
termination occurred (such amount of Annual Bonus is hereinafter
referred to as the "Remainder Bonus").
(iv) At any time for "Cause", which for purposes of this
Agreement shall be deemed to have occurred only on the happening of any
of the following:
(A) the plea of guilty to, or conviction for, the
commission of a felony offense by Executive; provided,
however, that after indictment, the Company may suspend
Executive from the rendition of services, but without
limiting or modifying in any other way the Company's
obligations under this Agreement,
(B) a material breach by Executive of a material
fiduciary duty owed to the Company;
(C) a material breach by Executive of any of the
covenants made by him in Sections 6 and 7 hereof; or
(D) the willful and gross neglect by Executive of
the material duties specifically and expressly required by
this Agreement;
provided, however, that any claim that "Cause", within the meaning of
clauses (B), (C) or (D) above, exists for the termination of Executive's
employment may be asserted on behalf of the Company only by a resolution
duly adopted by two-thirds of the total number of members of the Board
of Directors of the Company, and on]y after 15 days prior written notice
to Executive during which period he may cure the breach or neglect that
is the basis of any such claim, if curable; provided, further, that no
state of facts that, with or without notice to Executive or the passage
of time or both, would give rise to the right of the Company to
terminate Executive's employment pursuant to clause (ii) of this Section
1(b) may, directly or indirectly, in whole or in part, be the basis for a
claim that Cause, within the meaning of clause (D) above, exists for the
termination of Executive's employment; provided, further, that during
the period of twelve (12) months following a Change in Control (as
hereinafter defined), Cause shall be deemed to have occurred only upon
the happening of an event referred to in clause (A) above; and provided,
further, that the term "material" as used in clauses (B), (C) and (D)
above and in Section 10 hereof shall be construed by reference to the
effect of the relevant action or omission on the Company and its
subsidiaries taken as a whole.
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<PAGE> 3
(c) Effect of Termination by the Company. If Executive's
employment is terminated by the Company pursuant to Section 1 (b) hereof, all
Annual Base Salary and Annual Bonus (to the extent not otherwise included in
Remainder Bonus) that has accrued in favor of Executive as of the date of such
termination, to the extent unpaid or delivered, shall be paid or delivered to
Executive on the date of termination. If Executive dies while employed by the
Company or during the period that he is receiving payments pursuant to the
immediately succeeding sentence and, in either case, prior to the expiration of
the Employment Term, the Company shall, as promptly as practicable following
Executive's death, pay to Executive's designated beneficiary or beneficiaries
in a lump sum an amount equal to the Annual Base Salary that would have been
payable to Executive had his employment by the Company continued until the
expiration of the Employment Term plus the Remainder Bonus. If Executive's
employment is terminated pursuant to Section 1(b)(ii) of this Agreement, the
Company shall (i) continue to pay to Executive his Annual Base Salary as and
when the same would otherwise be due in accordance with Section 4 of this
Agreement until the first to occur of the expiration of the Employment Term or
the date of Executive's death and (ii) pay the Remainder Bonus to Executive on
the date of such termination. The amounts payable by the Company pursuant to
the foregoing two sentences shall be reduced by the amount of any long term
disability benefits paid directly to Executive pursuant to any benefit or
welfare plans maintained by the Company for Executive's benefit. The phrase
"designated beneficiary or beneficiaries" shall mean the person or persons
named from time to time by Executive in a signed instrument filed for this
purpose with the Company. If the designation made in any such signed
instrument shall for any reason be ineffective, the phrase "designated
beneficiary or beneficiaries" shall mean Executive's estate. With respect to
the payment of Annual Base Salary in respect of time periods subsequent to the
date of termination of Executive's employment with the Company, such amount
shall be calculated at the annual rate of Executive's Annual Base Salary in
effect at the time of termination and the calculation of the remaining
Employment Term shall be made without consideration of any renewal thereof,
unless at the time of such termination such renewal would otherwise be
automatic. With respect to the payment of the Remainder Bonus, such amount
shall be the amount which would have been payable to Executive as his Annual
Bonus in accordance with the applicable Company plan or program had Executive's
employment continued until the end of the fiscal year of the Company in which
such termination occurred, but without regard to any requirement in such plan
that Executive be employed by the Company at any time following the conclusion
of such succeeding fiscal year in order to receive his Annual Bonus; provided
however, that in the event Executive's employment is terminated as a result of
his death or disability, the amount of the Remainder Bonus shall be not less
than the amount paid or payable to Executive in respect of the immediately
preceding fiscal year of the Company.
(d) Termination by Executive. The Executive's employment may
be terminated during the Employment Term by the Executive (i) for Good Reason
or (ii) without any reason during the twelve (12) month period immediately
following a Change in Control. For purposes of this Agreement, "Good Reason"
shall mean
(i) the assignment to the Executive of any duties
inconsistent in any respect with the Executive's position
(including status, offices, titles and reporting
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<PAGE> 4
requirements), authority, duties or responsibilities as
contemplated by Section 2 of this Agreement, or any other action by
the Company which results in a diminution in such position,
authority, duties or responsibilities, excluding for this purpose
an isolated, insubstantial and inadvertent action not taken in bad
faith and which is remedied by the Company promptly after receipt
of notice thereof given by the Executive;
(ii) any material breach of this Agreement by the
Company which is not remedied by the Company promptly after receipt
of notice thereof given by the Executive;
(iii) any purported termination by the Company of the
Executive's employment otherwise than as expressly permitted by this
Agreement;
(iv) any failure by the Company to comply with and
satisfy Section 13 of this Agreement; or
(v) failure to reelect Executive as a member of the
Board of Directors or the removal of Executive as a member of such
Board.
For purposes of this subsection (d), a determination of "Good Reason" by the
Executive which is reasonable and is made in good faith shall be conclusive.
(c) Effect of Termination by the Executive. If Executive
terminates his employment with the Company pursuant to Section 1(d) of this
Agreement, or if the Company terminates the Executive's employment under this
Agreement in any way that is breach of this Agreement by the Company, the
Company shall pay to Executive in a lump sum upon such termination an amount in
cash equal to (i) all Annual Base Salary that has accrued in favor of Executive
as of the date of termination, to the extent unpaid or delivered, (ii) the
Annual Base Salary that would have been payable to Executive had his employment
by the Company continued until the expiration of the Employment Term and (iii)
the Remainder Bonus.
(f) Survival. Upon termination of Executive's employment and
payment of the amounts due Executive pursuant to Section 1 of this Agreement,
the obligations of the Company and the Executive under this Agreement shall
terminate, except that the Company's obligations with respect to the payment of
amounts upon the death or disability of Executive set forth in the second and
third sentences of Section 1(c) (if and to the extent applicable), Section 1(h)
(Continuation of Benefits), Section 4(e) (Indemnification), Section 5
(Reimbursement of Expenses) (as it relates to the expenses incurred prior to
such termination, including, without limitation, relocation expense incurred
pursuant to Section 5(c) and Schedule 5(c)), Section 12 (SARs) and Section 13
(Successors), and the Executive's obligations under Sections 6
(Noncompetition), 7 (Confidentiality), 8 (Delivery of Materials) and 9
(Noninterference), will survive (in accordance with the terms and conditions
thereof) any such termination.
(g) Change of Control. For purposes of this Agreement, a
"Change of Control" shall be deemed to have occurred as of the date upon which
either (x) Liberty Media Corporation
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<PAGE> 5
("Liberty", which term shall include any successor corporation, partnership or
other entity formed as a result of or in connection with any pro rata
distribution of securities or the right to acquire securities to the holders of
securities of Liberty, provided that the condition of clause (y) of this
Section 1(g) hereof continues to be satisfied) ceases to be the sole
"beneficial owner" (within the meaning of Rule 13d-3 promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) of Voting
Securities (as hereinafter defined) having a majority of the outstanding Voting
Power (as hereinafter defined) of the Company or (y) the individuals and
entities beneficially own Voting Securities of Liberty on the date of this
Agreement cease to beneficially own Voting Securities having a majority of
the outstanding Voting Power of Liberty. As used herein, the following terms
shall have the following meanings: (i) "Voting Securities" shall mean any
securities of the Company or Liberty, as the case may be, entitled, or which
may be entitled, to vote on matters submitted to stockholders generally
(whether or not entitled to vote generally in the election of directors), or
securities which are convertible into, or exercisable or exchangeable for such
Voting Securities, whether or not subject to the passage of time or any
contingency; and (ii) "Voting Power" shall mean the number of votes available
to be cast (determined by reference to the maximum number of votes entitled to
be cast by the holders of such Voting Securities (or by the holders of any
other Voting Securities into which such Voting Securities may be convertible,
exercisable or exchangeable for, whichever yields the highest number of votes)
upon any matter submitted to stockholders where the holders of all Voting
Securities vote together as a single class) by the holders of Voting
Securities.
(h) Continuation of Certain Benefits. In the event
Executive's employment is terminated for any reason other than for Cause, then
for the remainder of the Employment Term the Company shall continue benefits to
the Executive and/or the Executive's family at least equal to those which would
have been provided to them in accordance with this Agreement if the Executive's
employment had not been terminated, in accordance with the most favorable
plans, practices, programs or policies of the Company as in effect and
applicable generally to other executives and their families; provided, however,
that the Company may terminate such benefits if the Executive becomes
reemployed with another employer and is eligible to receive similar benefits
under such subsequent employer's benefit plans. For purposes of determining
eligibility of the Executive for retiree benefits pursuant to the Company's
plans, practices, programs and policies, the Executive shall be considered to
have remained employed until the end of the Employment Term and to have retired
on the last day of such period.
(2) Services to be Rendered by Executive. the Company and
Executive agree that Executive will serve the Company as its President and
Chief Executive Officer and shall have the rights, powers, duties and
obligations relating to such offices as is specified in the By-laws of the
Company as in effect on the date of this Agreement. In such capacity,
Executive shall perform all reasonable acts customarily associated with such
positions, or necessary or desirable to protect and advance the best interests
of the Company. Executive shall perform such acts and carry out such duties,
and shall in all other respects serve the Company faithfully and to the best
of his ability.
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<PAGE> 6
3. Time to be Devoted by Executive. Executive agrees to
devote substantially all of his business time, attention, efforts and abilities
to the business of the Company and to use his best efforts to promote the
interests of the Company. During the Employment Term it shall not be a
violation of this Agreement for the Executive to (i) serve on corporate, civic
or charitable boards or committees, (ii) fulfill speaking engagement and (iii)
manage personal investments, so long as such activities do not significantly
interfere with the performance of the Executive's responsibilities as an
employee of the Company in accordance with this Agreement.
4. Compensation.
(a) Salary. During the Employment Term, the
Executive shall receive an annual base salary of not less than $500,000
("Annual Base Salary"), which shall be paid on a semi-monthly basis.
(b) Annual Bonus. In addition to Annual Base
Salary, if the Compensation Committee of the Board of Directors of the Company
adopts an annual bonus program for its executive employees generally, the
Executive shall be entitled to participate in such program and be paid on an
annual basis such bonus amount ("Annual Bonus") as determined by such
Committee.
(c) Benefits. During the Employment Term, the
Executive (including, where applicable, Executive's family) shall be entitled
to benefits in accordance with the welfare benefit and incentive plans,
practices, programs and policies of the Company (including, but not limited to,
retirement, savings, incentive and stock compensation plans, employee stock
purchase plans, medical, death and disability, and life and other insurance
plans and policies).
(d) Vacation. During the Employment Term, the
Executive shall be entitled to four weeks of paid vacation per year or such
longer period as may be provided by the Company in accordance with the plans,
policies, programs and practices of the Company applicable to executives of the
Company generally.
(e) Indemnification.
(i) In addition to any separate agreements
between Executive and the Company relating to indemnification,
the Company will indemnify and hold harmless Executive, to the
fullest extent permitted by applicable law, in respect of any
liability, damage, cost or expense (including reasonable counsel
fees) incurred in connection with the defense of any claim, action,
suit or proceeding to which he is a party, or threat thereof, by
reason of his being or having been an officer or director of the
Company or any subsidiary or affiliate of the Company, or his
serving or having served at the request of the Company as a director,
officer, employee or agent of another corporation or of a partnership,
joint venture, trust, business organization, enterprise or other
entity, including service with respect to employee benefit plans.
Without limiting the generality of the foregoing, the Company will
pay the expenses (including reasonable counsel fees) of
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<PAGE> 7
defending any such claim, action, suit or proceeding in advance of its final
disposition, upon receipt of an undertaking by Executive to repay all amounts
advanced if it should ultimately be determined that Executive is not entitled
to be indemnified under this Section.
(ii) In addition to the foregoing, the Company agrees to
pay promptly as incurred, to the full extent permitted by law, all legal fees
and expenses incurred by Executive in connection with the defense (including
in connection with the defense of counterclaims or cross-claims) of any claim,
action, suit or proceeding relating to the enforcement by the Company (including
claims, actions, suits or proceedings brought in the right of the Company) of
the provisions of Sections 6, 7, 8 or 9 of this Agreement; provided, however,
that in the event that the Company (or any person asserting the Company's
right) is the prevailing party in such enforcement action (as determined by a
court of competent jurisdiction in a final adjudication not subject to appeal),
the Executive shall reimburse the Company for all payments made by it pursuant
to this Section 4(e)(ii).
(iii) Except as otherwise provided in Section 4(e)(ii)
above, the Company agrees to pay promptly as incurred, to the full extent
permitted by law, all legal fees and expenses which Executive may reasonably
incur as a result of any contest (regardless of the outcome thereof) by the
Company, Executive or of the validity or enforceability of, or liability under
any provision of this Agreement or any guarantee of performance thereof
(including as a result of any contest by Executive about the amount of any
payment pursuant to this Agreement), plus in each case interest on any delayed
payment at the applicable Federal rate provided for in Section 7872(f)(2)(A)
of the Code (as hereinafter defined).
(f) Certain Reduction of Payments by the Company.
(i) Anything in this Agreement to the contrary
notwithstanding, in the event it shall be determined that any payment or
distribution by the Company to or for the benefit of the Executive (whether
paid or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise, but determined without regard to any reduction
required under this Section 4(f) (a "Payment") would be nondeductible by the
Company for Federal income tax purposes because of Section 280G of the
Internal Revenue Code of 1986, as amended (the "Code"), then the aggregate
present value of all Payments shall be reduced (but not below zero) such that
such aggregate present value of Payments equals the Reduced Amount. The
"Reduced Amount" shall be an amount expressed in present value which maximizes
the aggregate present value of Payments without causing any Payment to be
nondeductible by the Company because of Section 280G of the Code. For purposes
of this Section 4(f), present value shall be determined in accordance with
Section 280G(d)(4) of the Code.
(ii) All determinations required to be made
under this Section 4(f) shall be made by the Company's regular independent
accounting and auditing firm (the
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<PAGE> 8
"Accounting Firm") which shall provide detailed supporting calculations both
to the Company and the Executive within 15 business days of the Date of
Termination. In the event that the Accounting Firm is serving as accountant or
auditor for the individual, entity or group effecting the Change of Control,
the Executive shall appoint another nationally recognized accounting firm to
make the determinations required hereunder (which accounting firm shall then be
referred to as the Accounting Firm hereunder). Any such determination by the
Accounting Firm shall be binding upon the Company and the Executive. All fees
and expenses of the Accounting Firm shall be borne by the Company. The
Executive shall determine which and how much of the Payments shall be
eliminated or reduced consistent with the requirements of this Section 4(f),
provided that, if the Executive does not make such determination within ten
business days of the receipt of the calculations made by the Accounting Firm,
the Company shall elect which and how much of the Payments shall be eliminated
or reduced consistent with the requirements of this Section 4(f) and shall
notify the Executive promptly of such election. Within Five business days
thereafter, the Company shall pay to or distribute to or for the benefit of the
Executive such Payments as are then due to the Executive and shall promptly pay
to or distribute to or for the benefit of the Executive such Payments as become
due to the Executive.
(iii) As a result of the uncertainty in the application
of Section 280G of the Code at the time of the initial determination by the
Accounting Firm hereunder, it is possible that Payments will have been made by
the Company which should have not been made ("Overpayment") or that additional
Payments which will have not been made by the Company could have been made
("Underpayment"), in each case, consistent with the calculations required to
be made hereunder. In the event that the Accounting Firm determines that an
Overpayment has been made, any such Overpayment shall be treated for all
purposes as a loan to the Executive which the Executive shall repay to the
Company together with interest at the applicable Federal rate provided for in
Section 7872(f)(2) of the Code; provided, however, that no amount shall be
payable by the Executive to the Company (or if paid by the Executive to the
Company shall be returned to the Executive) if an to the extent such payment
would not reduce the amount which is subject to taxation under Section 4999 of
the Code. In the event that the Accounting Firm determines that an
Underpayment has occurred, any such Underpayment shall be promptly paid by the
Company to or for the benefit of the Executive together with interest at the
applicable Federal rate provided for in section 7872(f)(2) of the Code.
5. Expenses; Relocation Expenses.
(a) During the Employment Term, the Executive shall be
entitled to receive prompt reimbursement for all reasonable expense incurred
by the Executive in accordance with the policies, practices and procedures of
the Company.
(b) In addition, the Company shall reimburse
Executive for the costs and expenses relating to the temporary and permanent
relocation of Executive and his family to the
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<PAGE> 9
Tampa, Florida area, including, but not limited to, reimbursement of Executive
for all reasonable temporary housing expenses for Executive and his family
during the period of their temporary relocation.
(c) The Company shall provide Executive with the
benefits (financial and otherwise) of the Company's relocation policy (a
description of which is set forth in Schedule 5(c) to this Agreement) with
respect to the sale of Executive's principle residence occupied prior to his
relocation to the Tampa, Florida area.
6. Noncompetition. Executive agrees that while in the
employ of the Company and, if Executive terminates his employment with the
Company prior to the expiration of the Employment Term in breach of his
obligations hereunder, for the period beginning on the date Executive
terminates his employment and ending on the date the Employment Term was
otherwise schedule to expire (the "Subject Period"), Executive will not,
directly or indirectly, as principal or agent, or in any other capacity, own,
manage, operate, participate in or be employed by or otherwise be interested
in, or connected in any manner with, any person, firm, corporation or other
enterprise which directly competes in a material respect with the business of
the Company or any of its majority-owned subsidiaries as it is conducted while
Executive is employed by the Company, except as provided in Schedule 6 hereto.
Nothing herein contained shall be construed as denying Executive the right to
own securities of any such corporation which is listed on a national securities
exchange or quoted in the National Association of Security Dealers, Inc.
Automated Quotation System (the "NASDAQ System") to the extent of an aggregate
of 5% of the amount of such securities outstanding.
7. Confidentiality. Executive agrees that while in the
employ of the Company (otherwise than in the performance of his duties
hereunder) and during the period of two years following the scheduled
expiration of the Employment Term, he shall not, directly or indirectly, make
use of, or divulge to any person, firm, corporation, entity or business
organization, and shall use his best efforts to prevent the publication or
disclosure of, any Confidential Information (as hereinafter defined) concerning
the Company, but this Section 7 shall not prevent Executive from responding to
any subpoena, court order or threat of other legal duress, provided Executive
notifies the Company thereof with reasonable promptness so that the Company may
seek a protective order or other appropriate relief. The term "Confidential
Information" shall mean information disclosed to Executive by the Company in
connection with his employment relating to the business of the Company,
including its accounts and finances, customers and customer lists, and its
future plans and proposals, to the extent that the foregoing matters are
considered proprietary by the Company; provided, however, that the following
shall not be deemed to be Confidential Information:
(a) information which is or becomes publicly known
other than as a result of a breach of this provision by Executive;
(b) information lawfully in the possession of
Executive prior to disclosure to him by the Company;
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<PAGE> 10
(c) information disclosed to Executive by any third party;
or
(d) information developed independently by Executive
subsequent to Executive's employment by the Company.
8. Delivery of Materials. Executive agrees that upon the
termination of his employment he will deliver to the Company all documents,
papers, materials and other property of the Company relating to its affairs
which may then be in his possession or under his control.
9. Noninterference. Executive agrees that he will not,
while in the employ of the Company and, in the event Executive terminates his
employment with the Company prior to the expiration of the Employment Term in
breach of his obligations hereunder, during the Subject Period, solicit the
employment of any employee of the Company on behalf of any other person, firm,
corporation, entity or business organization, or otherwise interfere with the
employment relationship between any employee or officer of the Company and the
Company.
10. Remedies of the Company. Executive agrees that, in the
event of a material breach by Executive of this Agreement, in addition to any
other rights that the Company may have pursuant to this Agreement, the Company
shall be entitled, if it so elects, to institute and prosecute proceedings at
law or in equity to obtain damages with respect to such breach or to enforce
the specific performance of this Agreement by Executive or to enjoin Executive
from engaging in any activity in violation hereof. Executive agrees that
because Executive's services to the Company are of such a unique and
extraordinary character, a suit at law may be an inadequate remedy with respect
to a breach by Executive of Sections 6, 7, 8 and 9 hereof, and that upon any
such breach or threatened breach by him of such Sections the Company shall be
entitled, in addition to any other lawful remedies that may be available to it,
to injunctive relief.
11. Notices. all notices to be given hereunder shall be
deemed duly given when delivered personally in writing or mailed, certified
mail, return receipt requested, postage prepaid and addressed as follows:
(a) If to be given to the Company:
Home Shopping Network, Inc.
2501 118th Avenue North
St. Petersburg, Florida 33716
Attention: Legal Department
(b) If to be given to Executive:
1416 Brightwaters Boulevard., N.E.
St. Petersburg, Florida 33704
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<PAGE> 11
With a separate copy to:
Baker & Botts, L.L.P.
885 Third Avenue
New York, New York 10020
Attention: Jerome H. Kern, Esq.
or to such other address as a party may request by notice given in accordance
with this Section 11.
12. Stock Appreciation Rights.
(a) The Company hereby grants to Executive Stock
Appreciation Rights ("SARs") with respect to 984,876 (the "Total Number of
SARs") shares of the Company's common stock, par value $.01 per share (the
"Common Stock", which term shall include the Common Stock of the Company as it
exists on the date hereof and any class or series into which it may hereafter
have been changed). The SARs granted hereunder shall vest over a four-year
period as follows: one-fourth of the Total Number of SARs shall vest and
become exercisable by Executive on each anniversary of the Effective Date,
commencing with February 23, 1994, such that the Total Number of SARs will be
fully vested on February 23, 1997, unless such vesting is accelerated pursuant
to Section 12(c) hereof. The SARs granted to Executive hereunder are not
granted under, and are not subject to the provisions of, any stock incentive,
bonus or other plan of the Company.
(b) SARs granted hereunder may be exercised, in
whole or in part and at any time or from time to time, during the period
commencing with the vesting of such SARs and ending on February 23, 2003,
unless earlier terminated in accordance with Section 12(c) hereof. SARs may be
exercised by delivery to the Company of a written notice specifying the whole
number of shares of Common Stock as to which SARs are being exercised;
provided, however, that in the event the Company ceases to be a Public Company
(as hereinafter defined) Executive may not exercise SARs on more than three
separate occasions, and SARs may not be exercised more than once in any fiscal
year of the Company during the period in which the Company is not a Public
Company. Upon the valid exercise of SARs, Executive shall be entitled to
receive from the Company cash or, so long as the Company is a Public Company,
shares of the Company's Common Stock (valued at the Fair Market Value (as
hereinafter defined) thereof) equal to the excess of (i) the Fair Market Value
of each share of Common Stock with respect to which such SARs have been
exercised over (ii) $8.25 per share (the "Strike Price").
(c) Upon termination of Executive's employment
hereunder, all SARs that have theretofore vested and not been exercised shall
remain exercisable for a period of one year after the effective date of the
termination of Executive's employment with the Company (the "Termination
Date") and shall thereafter terminate to the extent not exercised. In the
event of the termination of Executive's employment by the Company other than
for Cause, or termination of Executive's employment by Executive for Good
Reason, all unvested SARs shall vest
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immediately upon such termination and shall remain exercisable for a period of
one year following the Termination Date, and shall thereafter terminate to the
extent not exercised. In the event of a Change in Control, whether or not
Executive has elected to terminate his employment hereunder pursuant to
Section 1 (d) hereof, all vested SARs shall vest immediately prior to such
Change in Control, such that Executive may exercise all such SARs no later
than the time at which the Change in Control becomes effective, and such SARs
shall remain exercisable for a period of one year following termination of
Executive's employment (provided that Executive terminates his employment
within the twelve-month period referred to in Section 1(d)), and shall
thereafter terminate to the extent not exercised. In the event Executive's
employment is terminated as a result of his death or disability, all SARS that
become vested upon such event or that have theretofore vested shall remain
exercisable by Executive or his designated beneficiary or beneficiaries for a
period of one year after the Termination Date and notice of such expiration to
Executive, his designated beneficiary, if any, or his executor, as the case may
be, and shall thereafter terminate to the extent not exercised.
Notwithstanding anything contained in this subsection (c), no SAR shall be
exercisable after February 23, 2003.
(d) the Fair Market Value of a share of Common Stock
shall be determined on the date of exercise of an SAR, and the date of exercise
of such SAR shall mean the date on which the Company shall have received
written notice from Executive of the exercise of such SAR; provided, however,
that any such notice given by Executive by personal delivery or facsimile
transmission shall be deemed received by the Company at the time of such
delivery or transmission. The "Fair Market Value" of a share of Common Stock
shall be either (x) if the Company is a Public Company on the date of exercise,
the Reference Price (as hereinafter defined) of a share of Common Stock,
determined for the trading day preceding such date, or (y) if the Company is
not a Public Company on the date of exercise, the Per Share Value (as
hereinafter defined) of a share of Common Stock as of the date of exercise.
The "Reference Price" of a share of Common Stock shall be (i) the closing price
of a share of Common Stock for such trading day on the principal exchange on
which the Common Stock is listed, or (ii) if the Common Stock is not listed on
any national securities exchange, the closing price (or if none, the average of
the high and low bid prices) of a share of Common Stock on such trading day in
the over-the-counter market, as reported by the NASDAQ system. The "Per Share
Value" of a Share of Common Stock shall be determined as of the applicable
Appraisal Date (as hereinafter defined) and shall equal the quotient of the
Appraised Value (as hereinafter defined) of the Company divided by the sum of
(x) the total number of shares of Common Stock outstanding on such Appraisal
Date on a Fully Diluted Basis (as hereinafter defined) and (y) the total number
of SARs.
The Appraised Value of the Company shall be as agreed to by the
Company and Executive prior to the 31st day following the applicable Appraisal
Date. In the event that they have not reached agreement by such date
notwithstanding their respective good faith efforts to do so (each being
required to negotiate in good faith with the other at least for five (5)
business days), then the Company and Executive shall each designate a Qualified
Appraiser (as hereinafter defined) as promptly as practicable, but in no event
more than ten (10) days thereafter, which Qualified Appraisers shall be retained
by the Company to determine the Appraised Value of the
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<PAGE> 13
Company as of the applicable Appraisal Date. Each Qualified Appraiser shall
submit its written determination of the Appraised Value of the Company to the
Company and Executive within 45 days after the date of its retention. If the
higher determination of the two Qualified Appraisers is not greater than 110%
of the lower determination, the Appraised Value of the Company shall be the
average of such two determinations. If the higher determination is greater
than 110% of the lower determination, then such two Qualified Appraisers
shall jointly select within ten (10) days after the date on which the later of
such two determinations was delivered a third Qualified Appraiser to be
retained by the Company. Such third Qualified Appraiser shall deliver its
written determination of the Appraised Value of the Company as of the applicable
Appraisal Date within 30 days after its retention, and the Appraised Value of
the Company shall be the average of the two closest determinations or, if there
are not two closest determinations, the average of all three determinations.
The Company shall pay all fees and expenses relating to the determination of
the Appraised Value, including the fees and expenses of all Qualified
Appraisers (including the Qualified Appraiser selected by Executive).
For purposes of this Section 12(d), the following terms shall have
the following meanings.
(i) "Appraisal Date": The date of exercise of the SARs.
(ii) "Appraised Value": As of the applicable Appraisal
Date, the fair market value of the Company on a going concern
(whether as a sale of stock or assets) or liquidation basis
(whichever method would yield the highest valuation). The fair
market value of the Company on a going concern basis shall take
into account such considerations (including but not limited to tax
considerations which are specific to a sale of assets versus a
sale of stock) as would customarily affect the price at which a
willing seller would sell and a willing buyer would buy a
comparable business as a going concerning in an arm's length
transaction. The fair market value of the Company on a liquidation
basis shall take into account tax liabilities that would be
incurred on liquidation assuming the most tax efficient and
practical plan of liquidation.
(iii) "Fully Diluted Basis": All shares of Common Stock
outstanding on the date of determination, together with shares of
Common Stock issuable upon the conversion, exercise or exchange of
securities of the Company which are convertible into, or
exercisable or exchangeable for, Common Stock, without regard to
whether such securities have vested or are then convertible,
exercisable or exchangeable.
(iv) "Public Company": The Company shall be deemed
to be a Public Company for so long as (i) the Common Stock is
registered under Section 12 of the Exchange Act and (ii) the
Common Stock is regularly traded on a national securities exchange
or quoted by the NASDAQ System.
(v) "Qualified Appraiser": A nationally recognized
investment banking firm with substantial experience as of the
applicable Appraisal Date in valuing significant communications
properties including cable television programming entities.
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<PAGE> 14
(e) In the event of a stock dividend,
recapitalization, reorganization, split-up, spin-off, combination, exchange of
shares, warrants or rights offering to purchase Common Stock, or other similar
corporate event affecting the Common Stock such that an adjustment is required
in order to preserve the benefits of this Section 12, an adjustment shall be
made to increase or decrease any or all of (i) the number and kind of shares
subject to the SARs granted hereunder and/or (ii) the Strike Price, in such
manner as the Board of Directors may deem reasonable and appropriate, provided,
however, that the number of shares subject to the SARs granted hereunder shall
always be a whole number.
(f) The grant of SARs hereunder shall not affect in
any way the right or power of the Company to make reclassification,
reorganizations or other changes of or to its capital or business structure or
to merge, consolidate, liquidate, sell or otherwise dispose of all or any part
of its business or assets.
(g) The amount of cash payable at any time by the
Company upon the valid exercise of SARs granted hereunder shall not in any way
be reserved or held in trust by the Company. Executive shall not have any
rights against the Company in respect of payment of such amount of cash other
than the rights of an unsecured general creditor of the Company. The amount of
cash payable upon the valid exercise of SARs hereunder shall not be subject in
any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance or charge, and shall not in any manner be liable or subject to the
debts, contracts, liabilities, engagements or torts of Executive or of any
designated beneficiary or personal representative.
(h) The SARs granted to Executive hereunder are not
transferable, except to a designated beneficiary or beneficiaries upon
Executive's death, and may only be exercised by Executive during his lifetime.
Without limiting the generality of the foregoing and except as provided herein,
the SARs granted hereunder may not be assigned, transferred, pledged or
hypothecated in any way (whether by operation of law or otherwise) and are not
subject to execution, attachment or similar process. Except as provided
herein, any attempted assignment, transfer, pledge of hypothecation of, or
levy, attachment or similar process upon, any SARs shall be null and void and
without force or effect.
13. Successors.
(a) This Agreement is personal to the Executive and
without the prior written consent of the Company shall not be assignable by the
Executive otherwise than by will or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal representatives.
(b) This Agreement shall inure to the benefit of and
be binding upon the Company and its successors and assigns.
(c) The Company will require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially of the business and/or
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<PAGE> 15
assets of the Company to assume expressly and agree to perform this Agreement
in the same manner and to the same extent that the Company would be required to
perform it if no such succession had taken place. As used in this Agreement,
"Company" shall mean the Company as hereinbefore defined and any successor to
its business and/or assets as aforesaid which assumes and agrees to perform
this Agreement by operation of law, or otherwise.
14. Miscellaneous.
(a) This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof and replaces and
supersedes as of the date hereof any and all prior agreements and
understandings with respect to Executive's employment by the Company, whether
oral or written, between the parties hereto. This Agreement may not be changed
nor may any provision hereof be waived except by an instrument in writing duly
signed by the party to be charged. This Agreement shall be interpreted,
governed and controlled by the law of the State of Florida, without reference
to principles of conflict of laws.
(b) The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement.
(c) The Company may withhold from any amounts
payable under this Agreement such Federal, state or local taxes as shall be
required to be withheld pursuant to any applicable law or regulation.
(d) The Executive's or the Company's failure to
insist upon strict compliance with any provision hereof or any other provision
of this agreement or the failure to assert any right the Executive or the
Company may have hereunder, including, without limitation, the right
15
<PAGE> 16
of the Executive to terminate employment for Good Reason pursuant to Section
1(d) of this Agreement, shall not be deemed to be a waiver of such provision or
right or any other provision or right of this Agreement.
IN WITNESS WHEREOF, this Agreement has been executed as of the day and
year first above written.
<TABLE>
<CAPTION>
ATTEST: HOME SHOPPING NETWORK, INC.
<S> <C>
- ---------------- By: /s/ VIVIAN J. CARR
Name: ------------------
Title: Name: Vivian Carr
Title: Secretary
----------------------
Gerald F. Hogan
</TABLE>
16
<PAGE> 17
of the Executive to terminate employment for Good Reason pursuant to Section
1(d) of this Agreement, shall not be deemed to be a waiver of such provision or
right or any other provision or right of this Agreement.
IN WITNESS WHEREOF, this Agreement has been executed as of the day and year
first above written.
<TABLE>
<CAPTION>
ATTEST: HOME SHOPPING NETWORK, INC.
<S> <C>
By:
- ------------------- ------------------------
Name: Name:
Title: Title:
/s/ Gerald F. Hogan
---------------------------
Gerald F. Hogan
</TABLE>
16
<PAGE> 18
Schedule 5(c)
In accordance with the Home Shopping Network, Inc. ("HSN") policy and practice
in such matters, the following will apply in the sale of Executive's home at
3801 Topside Road, Knoxville, Tennessee:
<TABLE>
<S> <C>
1. The Guaranteed Sales Price, based on appraised value, shall be $1,100,000.00. HSN will guarantee Executive this price.
HSN reserves the right to review and approve/disapprove or modify any offers received by the realtor, Dean Smith Realty
of Knoxville, TN. If HSN accepts or directs Executive to accept an offer which is less than the appraised value, HSN
will reimburse Executive for the amount of the difference between the Guaranteed Sales Price and offer price, less the
monies it has paid towards the amortization of Executive's mortgage.
2. Monthly mortgage payments = $7,465.00. HSN will remit these payments to the first mortgage holder by the fifth day of
each month. Upon the sale of Executive's property, HSN will be reimbursed by Executive for any mortgage amortization
occurring during the period that HSN made such payments.
3. Maintenance. It is recognized that the property must be properly maintained while for sale. HSN will reimburse
Executive for this expense at the rate of $250.00 per month.
4. Insurance which provides appropriate protection against loss from fire, theft, vandalism, weather, etc. will be
maintained in Executive's name, and HSN will reimburse Executive for such amounts during the period prior to sale.
The annual cost of $2,836.00 will be paid by HSN. Executive will reimburse HSN for any insurance refunds made at the
closing.
5. Mr. Edward Vaughn will serve as agent on behalf of HSN to receive and review with Executive all offers presented by
Executive's realtors and, if appropriate, to adjust the asking price for the property.
6. The foregoing agreements shall remain in effect during the Employment Term and shall survive termination of the
Agreement; provided, however, that in the event Executive terminated his employment other than in accordance with
Section 1(d) of the Agreement, Executive shall be required to reimburse HSN for the amounts paid on Executive's behalf
pursuant to Sections 2, 3 and 4 of this Schedule 5(c).
</TABLE>
17
<PAGE> 1
EXHIBIT 5
March 28, 1994
Home Shopping Network, Inc.
11831 30th Court North
St. Petersburg, Florida 33716
RE: VALIDITY OF COMMON STOCK
Ladies and Gentlemen:
We are rendering this opinion in connection with the registration,
pursuant to a registration statement on Form S-8 (the "Registration Statement")
under the Securities Act of 1933, as amended (the "Securities Act"), of
1,104,876 shares of common stock, par value $.01 per share (the "Common
Stock"), of Home Shopping Network, Inc., a Delaware corporation (the
"Company"), issuable to certain individuals pursuant to two stock option
agreements and an employment agreement (the "Agreements").
In connection with the preparation of this opinion, we have examined
the minute books and stock records as presented to us by the Company, the
Restated Certificate of Incorporation and Restated By-Laws of the Company, the
Registration Statement, copies of resolutions duly adopted by the Board of
Directors of the Company relating to the authorization and proposed issuance of
the Common Stock, and certain documents relating to the Agreements. In
addition, we have reviewed such other documents and instruments and have
conferred with various officers and directors of the Company and have
ascertained or verified to our satisfaction such additional facts with respect
to the Company as we have deemed necessary or appropriate for the purposes of
this opinion.
We have assumed for purposes of this opinion that all applicable laws,
rules and regulations in effect at the time of the issuance of the Common Stock
pursuant to the Agreements will be the
<PAGE> 2
Home Shopping Network, Inc.
March 28, 1994
Page 19
same as such laws, rules and regulations in effect as of the date hereof.
Based on the foregoing, we are of the opinion that, subject to the
effectiveness of the Registration Statement and compliance with applicable
state securities laws, the Common Stock, when issued and paid for pursuant to
the terms of the Agreements, will constitute duly authorized, validly issued,
fully paid and nonassessable shares of Common Stock of the Company.
We hereby consent to all references to our firm in the Registration
Statement and to the filing of this opinion by the Company as an exhibit to the
Registration Statement. This consent is not to be construed as an admission
that we are a person whose consent is required to be filed with the
Registration Statement under the Securities Act.
Very truly yours,
/s/ Baker & McKenzie
Baker & McKenzie
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Home Shopping Network, Inc.
We consent to incorporation by reference herein of our reports dated February
15, 1994, relating to (1) the consolidated balance sheets of Home Shopping
Network, Inc. and subsidiaries as of December 31, 1993 and 1992, and the related
consolidated statements of operations, stockholders' equity, and cash flows for
the year ended December 31, 1993 and the four months ended December 31, 1992 and
(2) the related financial statement schedules. The report on the consolidated
financial statements appears in the 1993 Annual Report to stockholders of Home
Shopping Network, Inc. and has been incorporated by reference in the 1993 annual
report on Form 10-K. The report on the related financial statement schedules
appears in the 1993 annual report on Form 10-K of Home Shopping Network, Inc.
KPMG PEAT MARWICK
St. Petersburg, Florida
March 29, 1994
<PAGE> 1
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Home Shopping Network, Inc. on Form S-8 of our reports dated October 15, 1992
(February 15, 1994 as to Note H to the consolidated financial statements)
appearing in and incorporated by reference in the Annual Report on Form 10-K of
Home Shopping Network, Inc. for the year ended December 31, 1993.
DELOITTE & TOUCHE
Tampa, Florida
March 29, 1994
