<PAGE> 1
As filed with the Securities and Exchange Commission on May 14, 1996.
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.)
2501 118th Avenue North
St. Petersburg, Florida 33716
(Address, including zip code, of Registrant's principal executive offices)
=================
HOME SHOPPING NETWORK, INC.
1996 STOCK OPTION PLAN FOR EMPLOYEES
and
HOME SHOPPING NETWORK, INC.
1996 STOCK OPTION PLAN FOR OUTSIDE DIRECTORS
(Full title of the Plans)
=================
Kevin J. McKeon
Executive Vice President, Chief Financial Officer and Treasurer
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 Amount to be Proposed maximum Proposed Amount of
securities registered offering price maximum aggregate registration
to be registered per share(1) offering price fee
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Common Stock 18,700,000 $11.5625 $216,218,750 $74,558.19
Shares
========================================================================================
</TABLE>
(1) Pursuant to Rule 457 under the Securities Act of 1933, as amended,
the proposed maximum offering price per share and the proposed
maximum aggregate offering price are estimated solely for purposes
of calculating the registration fee and are based upon the average
of the high and low prices of the Common Stock of the Registrant on
the New York Stock Exchange on May 8, 1996.
Approximate date of proposed sales pursuant to the Plan:
As soon as practicable after this Registration Statement becomes effective.
<PAGE> 2
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 herein by reference:
1. Annual Report on Form 10-K for the year ended December 31, 1995,
which included the auditors' report of KPMG Peat Marwick LLP dated
February 21, 1996.
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, 1995.
3. The description of the Company's Common Stock contained in the
Company's Form S-8 Registration Statement No. 33-52869, filed on
March 29, 1994 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. Any statement contained
herein or in a document, all or a portion of which is incorporated or deemed to
be incorporated by reference herein, shall be deemed to be modified or
superseded for purposes of this Registration Statement to the extent that a
statement contained in any subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Registration
Statement. 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, Chief Financial Officer, Home
Shopping Network, Inc., P.O. Box
2
<PAGE> 3
9090, Clearwater, Florida 34618-9090.
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 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
3
<PAGE> 4
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.
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, or are expected to be, 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 8. Exhibits
4.1 Home Shopping Network, Inc. 1996 Stock Option Plan for Employees
4.2 Home Shopping Network, Inc. 1996 Stock Option Plan for Outside
Directors
5.0 Opinion of Baker & McKenzie
23 Consent of KPMG Peat Marwick LLP
24 Powers of Attorney (set forth on Signature page).
Item 9. Undertakings
The undersigned Registrant hereby undertakes:
4
<PAGE> 5
(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
Securities Act of 1933 ("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, 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 Exchange Act 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 1933 Act, 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.
Insofar as indemnification for liabilities under the 1933 Act may be
permitted to directors, officers and controlling persons of the
5
<PAGE> 6
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 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.
6
<PAGE> 7
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 9th day of
May, 1996.
HOME SHOPPING NETWORK, INC.
By: /s/ James G. Held
-------------------------------------
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 James G. Held 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/ James G. Held President, Chief May 9, 1996
--------------------- Executive Officer and
James G. Held Director (Principal
Executive Officer)
/s/ Kevin J. McKeon Executive Vice May 9, 1996
--------------------- President, Chief
Kevin J. McKeon Financial Officer
and Treasurer
(Principal Financial
Officer)
/s/ Brian J. Feldman Vice President and May 9, 1996
--------------------- Controller (Chief
Brian J. Feldman Accounting Officer)
</TABLE>
7
<PAGE> 8
<TABLE>
<S> <C> <C>
/s/ Barry Diller Chairman of the May 9, 1996
-------------------------- Board and Director
Barry Diller
/s/ Peter R. Barton Director May 9, 1996
--------------------------
Peter R. Barton
/s/ Robert R. Bennett Director May 9, 1996
--------------------------
Robert R. Bennett
/s/ Leo J. Hindery, Jr. Director May 9, 1996
--------------------------
Leo J. Hindery, Jr.
Director May 9, 1996
--------------------------
Gen. H. Norman Schwarzkopf
/s/ Eli J. Segal Director May 9, 1996
--------------------------
Eli J. Segal
</TABLE>
8
<PAGE> 9
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT PAGE
- ------ ----------------------- ----
<S> <C>
4.1 Home Shopping Network, Inc.
1996 Stock Option Plan for Employees
4.2 Home Shopping Network, Inc.
1996 Stock Option Plan for
Outside Directors
5.0 Opinion of Baker & McKenzie
23 Consent of KPMG Peat Marwick LLP
24 Powers of Attorney (set forth on Signature page).
</TABLE>
9
<PAGE> 1
APPENDIX A
HOME SHOPPING NETWORK, INC.
1996 STOCK OPTION PLAN FOR EMPLOYEES
ESTABLISHMENT, PURPOSE AND TERM OF PLAN.
ESTABLISHMENT. The Home Shopping Network, Inc. 1996 Stock
Option Plan for Employees (the "PLAN") is hereby established effective as of
May 10, 1996 (the "EFFECTIVE DATE").
PURPOSE. The purpose of the Plan is to promote the success
of the Company and its Subsidiaries by attracting and retaining employees by
supplementing their cash compensation and providing a means for them to
increase their holdings of Stock of the Company. The opportunity so provided
and the receipt of Options as compensation are intended to foster in
participants a strong incentive to put forth maximum effort for the continued
success and growth of the Company for the benefit of customers and
shareholders, to aid in retaining individuals who put forth such efforts, and
to assist in attracting the best available individuals in the future.
TERM OF PLAN. The Plan shall continue in effect until the
earlier of its termination by the Board or the date on which all of the shares
of Stock available for issuance under the Plan have been issued. However, all
Options shall be granted, if at all, within ten (10) years from the Effective
Date. Notwithstanding the foregoing, if the maximum number of shares of Stock
issuable pursuant to the Plan as provided in Section 3.1 has been increased at
any time, all Options shall be granted, if at all, within ten (10) years from
the date such amendment was adopted by the Board. On the effective date of the
Plan, it shall supersede the 1986 Stock Option Plan for Employees, which shall
terminate on that date.
1. DEFINITIONS AND CONSTRUCTION.
1.1 DEFINITIONS. Whenever used herein, the following
terms shall have their respective meanings set forth below:
(a) "BOARD" means the Board of Directors of the
Company or the Committee.
(b) "CODE" means the Internal Revenue Code of
1986, as amended, and any applicable regulations promulgated thereunder.
(c) "COMMITTEE" means the Compensation/Benefits
Committee or other committee of the Board duly appointed to administer the Plan
and having such powers as shall be specified by the Board. Unless the powers
of the Committee have been specifically limited, the Committee shall have all
of the powers of the Board granted herein, including, without limitation, the
power to amend or terminate the Plan at any time, subject to the terms of the
Plan and any applicable limitations imposed by law.
1
<PAGE> 2
(c) "COMPANY" means Home Shopping Network, Inc.,
a Delaware corporation, or any successor corporation thereto.
(d) "EMPLOYEE" means any person treated as an
employee (including an officer or a director who is also treated as an
employee) in the records of the Company and its Subsidiaries; provided,
however, that neither service as a director nor payment of a director's fee
shall be sufficient to constitute employment for purposes of the Plan.
Notwithstanding the foregoing, the Chairman of the Board and any consultant
approved by the Board shall be deemed an Employee for purposes of the Plan;
provided, however neither the Chairman nor a consultant may be issued
Incentive Stock Options.
(e) "EXCHANGE ACT" means the Securities Exchange
Act of 1934, as amended.
(f) "FAIR MARKET VALUE" means, as of any date,
the closing price of the Stock on the New York Stock Exchange, Inc. (as
published by the Wall Street Journal, if published) on the day prior to such
date, or if the Stock was not traded on such day, on the next preceding day on
which the Stock was traded.
(g) "INCENTIVE STOCK OPTION" means an Option so
denominated in the Option Agreement and which qualifies as an incentive stock
option within the meaning of Section 422(b) of the Code.
(h) "NONQUALIFIED STOCK OPTION" means an Option
so denominated or which does not qualify as an Incentive Stock Option.
(i) "OPTION" means a right to purchase Stock
(subject to adjustment as provided in Section 3.2) pursuant to the terms and
conditions of the Plan. An Option may be either an Incentive Stock Option or a
Nonqualified Stock Option.
(j) "OPTION AGREEMENT" means a written agreement
between the Company and an Optionee setting forth the terms, conditions and
restrictions of the Option and/or SAR granted to the Optionee.
(k) "OPTIONEE" means a person who has been
granted one or more Options and/or SAR's pursuant to the Plan.
(l) "RULE 16B-3" means Rule 16b-3 under the
Exchange Act, as amended from time to time, or any successor rule or
regulation.
(m) "STOCK" means the Company's common stock,
$.01 par value, as adjusted from time to time in accordance with Section
3.2.
2
<PAGE> 3
(n) "STOCK APPRECIATION RIGHT (SAR)" means the
right, granted by the Board (subject to adjustments provided in Section 3.2),
pursuant to the terms of the Plan, to receive payment equal to the subsequent
increase in the Fair Market Value of the Stock.
(o) "SUBSIDIARY" means any present or future
"subsidiary corporation" of the Company, as defined in Section 424(f) of the
Code.
(p) "TEN PERCENT OWNER OPTIONEE" means an
Optionee who, at the time an Option is granted to the Optionee, owns stock
constituting more than ten percent (10%) of the total combined voting power of
all classes of stock of Company within the meaning of Section 422(b)(6) of the
Code.
(q) "TRANSFER OF CONTROL" shall mean a
transaction or a series of related transactions (collectively, the
"TRANSACTION") wherein the shareholders of the Company immediately before the
Transaction do not retain immediately after the Transaction, in substantially
the same proportions as their ownership of shares of the Company's voting stock
immediately before the Transaction, direct or indirect beneficial ownership of
more than fifty percent (50%) of the total combined voting power of the
outstanding voting stock of the Company or the corporation or corporations to
which the assets of the Company were transferred (the "TRANSFEREE
CORPORATION(S)"), as the case may be, except for such a transaction pursuant to
which Barry Diller, Liberty Media Corporation or any of their respective
affiliates, is or becomes such a 50% owner. For purposes of the preceding
sentence, indirect beneficial ownership shall include, without limitation, an
interest resulting from ownership of the voting stock of one or more
corporations which, as a result of the Transaction, own the Company or the
Transferee Corporation(s), as the case may be, either directly or through one
or more subsidiary corporations. The Board shall have the right to determine
whether multiple sales or exchanges of the voting stock of the Company are
related, and its determination shall be final, binding and conclusive.
1.2 CONSTRUCTION. Captions and titles contained herein
are for convenience only and shall not affect the meaning or interpretation of
any provision of the Plan. Except when otherwise indicated by the context, the
singular shall include the plural, the plural shall include the singular, and
the term "or" shall include the conjunctive as well as the disjunctive.
2. ADMINISTRATION.
2.1 ADMINISTRATION BY THE BOARD. The Plan shall be
administered by the Board, including any duly appointed committee of the Board.
All questions of interpretation of the Plan or of any Option or SAR shall be
determined by the Board, and such determinations shall be final and binding
upon all persons having an interest in the Plan or such Option or SAR.
2.2 POWERS OF THE BOARD. In addition to any other powers
set forth in the Plan and subject to the provisions of the Plan and
restrictions regarding Incentive Stock Options set forth in the Code, the Board
shall have the full and final power and authority, in its sole discretion:
3
<PAGE> 4
(a) to determine the persons to whom, and the
time or times at which, Options shall be granted and the number of shares of
Stock to be subject to each Option which determination need not be uniform
among persons similarly situated and may be made selectively among Employees;
(b) to designate Options as Incentive Stock
Options or Nonqualified Stock Options;
(c) to determine the persons to whom, and the
time or times at which, SAR's and the number thereof shall be granted which
determination need not be uniform among persons similarly situated and may be
made selectively among Employees;
(d) to determine the terms, conditions and
restrictions applicable (which need not be identical) to each Option and SAR
including, without limitation, (i) the exercise price of the Option or SAR,
(ii) the method of payment for shares purchased upon the exercise of the
Option, (iii) the method for satisfaction of any tax withholding obligation
arising in connection with the Option or SAR , including by the withholding or
delivery of shares of stock, (iv) the method of payment upon exercise of any
SAR's, (v) the timing, terms and conditions of the exercisability of the
Option or SAR, (vi) the time of the expiration of the Option or SAR, (vii) the
effect of the Optionee's termination of employment or service with Company on
any of the foregoing, and (viii) all other terms, conditions and restrictions
applicable to the Option or SAR or such shares not inconsistent with the terms
of the Plan;
(e) to approve one or more forms of Option
Agreement;
(f) to amend the exercisability of any Option or
SAR , including with respect to the period following an Optionee's termination
of employment or service with the Company;
(g) to prescribe, amend or rescind rules,
guidelines and policies relating to the Plan, or to adopt supplements to, or
alternative versions of, the Plan, including, without limitation, as the Board
deems necessary or desirable to comply with the laws of, or to accommodate the
tax policy or custom of, foreign jurisdictions whose citizens may be granted
Options or SAR's; and
(h) to correct any defect, supply any omission or
reconcile any inconsistency in the Plan or any Option Agreement and to make all
other determinations and take such other actions with respect to the Plan or
any Option or SAR as the Board may deem advisable to the extent consistent with
the Plan and applicable law.
2.3 DISINTERESTED ADMINISTRATION. The Plan shall be
administered in compliance with the "disinterested administration" requirements
of Rule 16b-3.
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<PAGE> 5
3. SHARES SUBJECT TO PLAN.
3.1 MAXIMUM NUMBER OF SHARES ISSUABLE. Subject to
adjustment as provided in Section 3.2, the maximum aggregate number of shares
of Stock that may be issued under the Plan and under the 1996 Stock Option Plan
for Outside Directors shall be Eighteen Million Seven Hundred Thousand
(18,700,000) and shall consist of authorized but unissued or reacquired shares
of Stock or any combination thereof. If an outstanding Option or SAR for any
reason expires or is terminated or canceled prior to being fully exercised, the
shares of Stock allocable to the unexercised portion of such Option or SAR,
shall again be available for issuance under the Plan.
3.2 ADJUSTMENTS FOR CHANGES IN CAPITAL STRUCTURE. In the
event of any stock dividend, stock split, reverse stock split,
recapitalization, combination, reclassification or similar change in the
capital structure of the Company, appropriate adjustments shall be made in the
number and class of shares subject to the Plan and to any outstanding Options
and SAR's and in the exercise price per share of any outstanding Options and
SAR's. If a majority of the shares which are of the same class as the shares
that are subject to outstanding Options and SAR's are exchanged for, converted
into, or otherwise become (whether or not pursuant to a Transfer of Control )
shares of another corporation (the "NEW SHARES"), the Board shall amend the
outstanding Options and SAR's to provide that such Options and SAR's are
exercisable for or with respect to New Shares. In the event of any such
amendment, the number of shares subject to, and the exercise price per share
of, the outstanding Options and SAR's shall be adjusted in a fair and equitable
manner as determined by the Board, in its sole discretion. In the event of any
merger, consolidation or other combination materially effecting the number of
shares of Stock outstanding, the Board may, in its discretion, amend the
outstanding Options to make appropriate adjustments in the number and class of
shares subject to the Plan and to any outstanding Options and SAR's and in the
exercise price per share of any outstanding Options and SAR's. Notwithstanding
the foregoing, any fractional share resulting from an adjustment pursuant to
this Section 3.2 shall be rounded up or down to the nearest whole number, as
determined by the Board, and in no event may the exercise price be decreased
to an amount less than the par value, if any, of the stock subject to the
Option. The adjustments determined by the Board pursuant to this Section 3.2
shall be final, binding and conclusive.
4. ELIGIBILITY AND OPTION LIMITATIONS.
4.1 PERSONS ELIGIBLE FOR OPTIONS AND SAR'S. Options and
SAR's may be granted only to Employees.
4.2 DIRECTORS SERVING ON COMMITTEE. No member of a
committee established to administer the Plan in compliance with the
"disinterested administration" requirements of Rule 16b-3, while a member,
shall be eligible to be granted an Option or SAR.
4.3 FAIR MARKET VALUE LIMITATION. To the extent that the
aggregate Fair Market Value of stock with respect to which options designated
as Incentive Stock Options are exercisable by an Optionee for the first time
during any calendar year (under all stock option plans of the
5
<PAGE> 6
Company, including the Plan) exceeds One Hundred Thousand Dollars ($100,000),
the portion of such Options which exceeds such amount shall be treated as
Nonqualified Stock Options. For purposes of this Section 4.3, options
designated as Incentive Stock Options shall be taken into account in the order
in which they were granted, and the Fair Market Value of stock shall be
determined as of the time the Option with respect to such stock is granted. If
the Code is amended to provide for a different limitation from that set forth
in this Section 4.3, such different limitation shall be deemed incorporated
herein effective as of the date and with respect to such Options as required or
permitted by such amendment to the Code. If an Option is treated as an
Incentive Stock Option in part and as a Nonqualified Stock Option in part by
reason of the limitation set forth in this Section 4.3, the Optionee may
designate which portion of such Option the Optionee is exercising and may
request that separate certificates representing each such portion be issued
upon the exercise of the Option. In the absence of such designation, the
Optionee shall be deemed to have exercised the Incentive Stock Option portion
of the Option first.
4.4 NO RIGHT OF EMPLOYMENT. Nothing in the Plan or in
any Option or SAR granted shall confer any right on an Employee to continue in
the employ of the Company or its Subsidiaries or shall interfere in any way
with the right of the Company or its Subsidiaries to terminate such Employee's
employment at any time.
5. TERMS AND CONDITIONS OF GRANTS. Options and SAR's shall be
evidenced by Option Agreements specifying the number of shares of Stock covered
thereby, in such form as the Board shall from time to time establish. SAR's
may be granted alone or in tandem with an Option grant, in the Board's sole
discretion(but at all times subject to the provisions of the Code). Option
Agreements may incorporate all or any of the terms of the Plan by reference and
shall comply with and be subject to the following terms and conditions:
5.1 EXERCISE PRICE. The exercise price for each Option
and SAR shall be established in the sole discretion of the Board; provided,
however, if the Option is an Incentive Stock Option that (a) the exercise price
per share for an Option shall not be less than the Fair Market Value of a
share of Stock on the effective date of grant of the Option; and (b) no Option
granted to a Ten Percent Owner Optionee shall have an exercise price per share
less than one hundred ten percent (110%) of the Fair Market Value of a share of
Stock on the effective date of grant of the Option. The exercise price for a
Nonqualified Stock Option and SAR shall be the same as provided above, unless
otherwise determined by the Board (but at all times subject to the provisions
of the Code). Notwithstanding the foregoing, an Option (whether an Incentive
Stock Option or a Nonqualified Stock Option) may be granted with an exercise
price lower than the minimum exercise price set forth above if such Option is
granted pursuant to an assumption or substitution for another option in a
manner qualifying under the provisions of Section 424(a) of the Code.
5.2 EXERCISE PERIOD. Options and SAR's shall be
exercisable at such time or times, or upon such event or events, and subject to
such terms, conditions, performance criteria, and restrictions as shall be
determined by the Board and set forth in the Option Agreement evidencing such
Option; provided, however, that (a) no Option or SAR shall be exercisable after
the expiration
6
<PAGE> 7
of ten (10) years after the effective date of grant of such Option or SAR; and
(b) no Incentive Stock Option granted to a Ten Percent Owner Optionee shall be
exercisable after the expiration of five (5) years after the effective date of
grant of such Option.
5.3 PAYMENT OF OPTION EXERCISE PRICE.
(a) FORMS OF CONSIDERATION AUTHORIZED. Except as
otherwise provided below, payment of the exercise price for the number of
shares of Stock being purchased pursuant to any Option shall be made (i) in
cash, by check, or cash equivalent, (ii) by tender to the Company of shares of
Stock owned by the Optionee having a Fair Market Value (as determined by the
Company without regard to any restrictions on transferability applicable to
such stock by reason of federal or state securities laws or agreements with an
underwriter for the Company) not less than the exercise price, (iii) by the
assignment of the proceeds of a sale or loan with respect to some or all of the
shares being acquired upon the exercise of the Option (including, without
limitation, through an exercise complying with the provisions of Regulation T
as promulgated from time to time by the Board of Governors of the Federal
Reserve System) (a "CASHLESS EXERCISE"), (iv) by such other consideration as
may be approved by the Board from time to time to the extent permitted by
applicable law or (v) by any combination thereof. The Board may at any time or
from time to time, by adoption of or by amendment to the standard forms of
Option Agreement described in Section 6, or by other means, grant Options which
do not permit all of the foregoing forms of consideration to be used in payment
of the exercise price or which otherwise restrict one or more forms of
consideration.
(b) TENDER OF STOCK. Notwithstanding the
foregoing, an Option may not be exercised by tender to the Company of shares of
Stock to the extent such tender of Stock would constitute a violation of the
provisions of any law, regulation or agreement restricting the redemption of
the Company's stock. Unless otherwise provided by the Board, an Option may not
be exercised by tender to the Company of shares of Stock unless such shares
either have been owned by the Optionee for more than six (6) months or were not
acquired, directly or indirectly, from the Company.
(c) CASHLESS EXERCISE. The Company reserves, at
any and all times, the right, in the Company's sole and absolute discretion, to
establish, decline to approve or terminate any program or procedures for the
exercise of Options by means of a Cashless Exercise.
5.4 PAYMENT OF SAR'S. Upon exercise of a SAR the
Company shall pay, subject to 5.5 below, the amount, if any, by which the
Fair Market Value of a share of Stock on the date of exercise exceeds the Fair
Market Value on the date of grant. The exercise of a SAR shall cancel any
Option associated with it if said SAR was granted in tandem with an Option.
The payment for SAR's shall be made in shares of Stock, valued at the Fair
Market Value on the date of exercise or, at the sole discretion of the Board,
in cash, or partly in cash and partly in Stock.
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<PAGE> 8
5.5 TAX WITHHOLDING. The Company shall have the right,
but not the obligation, to deduct from the shares of Stock issuable upon the
exercise of an Option, or to deduct from amounts due the Optionee upon exercise
of a SAR or to accept from the Optionee the tender of, a number of whole shares
of Stock having a Fair Market Value, as determined by the Company, equal to all
or any part of the federal, state, local and foreign taxes, if any, required by
law to be withheld by the Company with respect to such Option or SAR exercise.
Alternatively, or in addition, in its sole discretion, the Company shall have
the right to require the Optionee, through payroll withholding, cash payment or
otherwise, including by means of a Cashless Exercise, to make adequate
provision for any such tax withholding obligations of the Company arising in
connection with the Option or SAR exercise. The Company shall have no
obligation to deliver shares of Stock, money or to release shares of Stock from
an escrow established pursuant to the Option Agreement until the Company's tax
withholding obligations have been satisfied by the Optionee.
6. STANDARD FORMS OF OPTION AGREEMENT.
6.1 INCENTIVE STOCK OPTIONS. Unless otherwise provided
by the Board at the time the Option is granted, an Option designated as an
"Incentive Stock Option" shall comply with and be subject to the terms and
conditions set forth in the appropriate form of Incentive Stock Option
Agreement as adopted by the Board and as amended from time to time.
6.2 NONQUALIFIED STOCK OPTIONS. Unless otherwise
provided by the Board at the time the Option is granted, an Option designated
as a "Nonqualified Stock Option" shall comply with and be subject to the terms
and conditions set forth in the appropriate form of Nonqualified Stock Option
Agreement as adopted by the Board and as amended from time to time.
6.3 SAR'S. Unless otherwise provided by the Board at
the time a SAR is granted, a SAR awarded either alone or in tandem with an
Option shall comply with and be subject to the terms and conditions set forth
in the appropriate form of SAR Option Agreement as adopted by the Board and as
amended from time to time.
6.4 STANDARD TERM OF OPTIONS. Except as otherwise
provided by the Board in the grant of an Option or SAR, any Option or SAR
granted hereunder shall have a term of ten (10) years from the effective date
of grant of the Option or SAR.
6.5 STANDARD VESTING PROVISIONS. Except as otherwise
provided by the Board in the grant of an Option or SAR, any Options or SAR's
granted hereunder shall become vested and exercisable at the rate of twenty
percent (20%) per year, commencing upon the first anniversary of the effective
date of grant of the Option or SAR and each of the four (4) subsequent
anniversaries thereafter.
6.6 AUTHORITY TO VARY TERMS. The Board shall have the
authority from time to time to vary the terms of any of the standard forms of
Option Agreement described in this Section
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<PAGE> 9
6 either in connection with the grant or amendment of an individual Option or
SAR or in connection with the authorization of a new standard form or forms;
provided, however, that the terms and conditions of any such new, revised or
amended standard form or forms of Option Agreement shall be in accordance with
the terms of the Plan. The Board, may in its discretion, provide for the
extension of the exercise period of an Option or SAR, accelerate the vesting of
an Option or SAR, eliminate or make less restrictive any restrictions contained
in an Option Agreement or waive any restriction or provision of this Plan or
an Option Agreement in any manner that is either (i) not adverse to the
Optionee or (ii) consented to by the Optionee.
7. NONTRANSFERABILITY OF OPTIONS. During the lifetime of the
Optionee, an Option or SAR shall be exercisable only by the Optionee or the
Optionee's guardian or legal representative. No Option or SAR shall be
assignable or transferable by the Optionee, except by will or by the laws of
descent and distribution. Following an Optionee's death, the Option shall be
exercisable to the extent provided in Section 8 below.
8. EFFECT OF TERMINATION OF SERVICE.
8.1 OPTION AND SAR EXERCISABILITY.
(a) DISABILITY. If the Optionee's service with
the Company is terminated because of the disability of the Optionee, the
Option, to the extent unexercised and exercisable on the date on which the
Optionee's service terminated, may be exercised by the Optionee (or the
Optionee's guardian or legal representative) at any time prior to the
expiration of three (3) months after the date on which the Optionee's service
terminated, but in any event no later than the Option expiration date.
(b) DEATH. If the Optionee's service with the
Company is terminated because of the death of the Optionee, the Option, to the
extent unexercised and exercisable on the date on which the Optionee's service
terminated, may be exercised by the the Optionee's legal representative or
other person who acquired the right to exercise the Option by reason of the
Optionee's death at any time prior to the expiration of six (6) months after
the date on which the Optionee's service terminated, but in any event no later
than the Option Expiration Date. The Optionee's service shall be deemed to
have terminated on account of death if the Optionee dies within three (3)
months after the Optionee's termination of service.
(c) TERMINATION OF SERVICE. If the Optionee's
service with the Company terminates for any reason, except disability or
death, the Option, to the extent unexercised and exercisable by the Optionee on
the date on which the Optionee's service terminated, may be exercised by the
Optionee within six (6) months after the date on which the Optionee's service
terminated, but in any event no later than the Option Expiration Date.
Notwithstanding the foregoing, the Company , may in its sole discretion,
cancel the Options if the Optionee has been Terminated for Cause (as defined
in Section 8.2).
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<PAGE> 10
(e) SAME CONDITIONS APPLICABLE TO SAR'S. The
same terms and conditions applicable to Options shall apply to the
exercisability of SAR's upon the occurrence of (a) - (d) above.
8.2 TERMINATION FOR CAUSE. "TERMINATION FOR CAUSE" shall
mean termination by the Company of the Optionee's service with Company for
any of the following reasons: (i) theft, dishonesty, or falsification of any
employment or Company records; (ii) improper use or disclosure of Company's
confidential or proprietary information; (iii) the Optionee's failure or
inability to perform any reasonable assigned duties after written notice from
Company of, and a reasonable opportunity to cure, such failure or inability;
(iv) any material breach by the Optionee of any employment agreement between
the Optionee and Company, which breach is not cured pursuant to the terms of
such agreement; or (v) the Optionee's conviction of any criminal act which
impairs Optionee's ability to perform his or her duties with Company.
Termination for Cause pursuant to the foregoing shall be determined in the sole
but reasonably exercised discretion of the Company.
9. EFFECT OF TRANSFER OF CONTROL. Except as otherwise provided
by the Board in the grant of an Option or SAR, in the event of a Transfer of
Control, any Options and SAR's outstanding as of the date such Transfer of
Control is determined to have occurred, and which are not then exercisable and
vested, shall become fully exercisable and vested to the full extent of the
original grant; provided, however, in the case of any holder of SAR's who is
subject to Section 16(b) of the Exchange Act, and whose SAR's are not already
outstanding for at least six months at the date of the Transfer of Control,
such SAR's shall not become fully exercisable and vested until they have been
outstanding for six months.
10. INDEMNIFICATION. In addition to such other rights of
indemnification as they may have as members of the Board or officers or
employees of the Company , members of the Board and any officers or employees
of the Company to whom authority to act for the Board is delegated shall be
indemnified by the Company against all reasonable expenses, including
attorneys' fees, incurred in connection with the defense of any action, suit
or proceeding, or in connection with any appeal therein, to which they or any
of them may be a party by reason of any action taken or failure to act under or
in connection with the Plan, Option, or any right granted hereunder, and
against all amounts in settlement thereof (provided such settlement is approved
by independent legal counsel selected by the Company) or paid in satisfaction
of a judgment in any such action, suit or proceeding, except in relation to
matters as to which it shall be adjudged in such action, suit or proceeding
that such person is liable for gross negligence, bad faith or intentional
misconduct in duties; provided, however, that within sixty (60) days after the
institution of such action, suit or proceeding, such person shall offer to the
Company, in writing, the opportunity at its own expense to handle and defend
the same. Without limiting the generality of the foregoing, Company will pay
the expenses (including reasonable counsel fees) of defending any such claim,
action, suit or proceeding in advance of its final disposition, upon receipt of
such person's written agreement to repay all amounts advanced if it should
ultimately be determined that such person is not entitled to be indemnified
under this Section.
10
<PAGE> 11
11. TERMINATION OR AMENDMENT OF PLAN. The Board, without further
approval of the shareholders, may terminate or amend this Plan at any time in
any respect as the Board deems advisable, subject to any required stockholder
or regulatory approval and to any conditions established by the terms of such
amendment, provided that in no event shall the Plan be amended more than once
every six (6) months other than to comply with changes in any applicable law or
governmental regulation in the Code, the Employee Retirement Income Security
Act, or the rules promulgated by the Securities and Exchange Commission. In
any event, no termination or amendment of the Plan may adversely affect any
then outstanding Option or SAR or any unexercised portion thereof, without the
consent of the Optionee, unless such termination or amendment is required to
enable an Option designated as an Incentive Stock Option to qualify as an
Incentive Stock Option or is necessary to comply with any applicable law or
government regulation.
12. DISSOLUTION OF COMPANY. Upon the dissolution of the Company,
the Plan shall terminate and any and all Options previously granted shall lapse
on the date of such dissolution.
13. RIGHTS AS SHAREHOLDERS. No Optionee, nor any beneficiary
or other person claiming through an Optionee, shall have any interest in any
shares of Stock allocated for the purposes of the Plan or subject to any Option
or SAR until such shares of Stock shall have been issued to the Optionee or
such beneficiary or other person. Furthermore, the existence of the Options
or the SAR's shall not affect the right or power of the Company or its
shareholders to make adjustments, recapitalization, reorganizations, or other
changes in the Company's capital structure or its business; issue bonds,
debentures, preferred or prior preference stocks affecting the Stock of the
Company or the rights thereof; dissolve the Corporation or sell or transfer any
part of its assets or business; or do any other corporate act, whether of a
similar character or otherwise.
14. GOVERNING LAW. The validity, interpretation, and
administration of the Plan and of any rules, regulations, determinations, or
decisions made thereunder, and the rights of any and all persons having or
claiming to have any interest therein or thereunder, shall be determined
exclusively in accordance with the laws of the State of Florida, without giving
effect to choice of law provisions. Without limiting the generality of the
foregoing, the period within which any action in connection with the Plan must
be commenced shall be governed by the laws of the State of Florida, without
regard to the place where the act or omission complained of took place or the
residence of any party to such action.
15. ARBITRATION. Any action brought in connection with the Plan
or an Option Agreement shall be settled exclusively by binding arbitration
conducted in the City of Tampa, Florida in accordance with the commercial rules
of the American Arbitration Association then in effect (the "Rules"), by a
single, independent arbitrator selected by the Company and the other party to
the action. If the parties cannot agree on an arbitrator, within thirty (30)
days of the commencement of an arbitration proceeding hereunder, either party
may request that the American Arbitration Association select an arbitrator,
with experience in law relating to option plans, in accordance with the Rules.
The decision of the arbitrator shall be final and binding. Judgment upon the
award rendered by the arbitrator may be entered in any court having
jurisdiction thereof. The
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<PAGE> 12
cost of any arbitration proceeding conducted hereunder shall be borne equally
between the parties unless otherwise determined by the arbitrator.
16. SHAREHOLDER APPROVAL. The Plan or any increase in the maximum
number of shares of Stock issuable thereunder as provided in Section 3.1 (the
"MAXIMUM SHARES") shall be approved by the shareholders of the Company within
twelve (12) months of the date of adoption thereof by the Board. Options
granted prior to shareholder approval of the Plan or in excess of the Maximum
Shares previously approved by the shareholders shall become exercisable no
earlier than the date of shareholder approval of the Plan or such increase in
the Maximum Shares, as the case may be.
IN WITNESS WHEREOF, the undersigned Secretary of the Company certifies
that the foregoing Home Shopping Network, Inc. 1996 Stock Option Plan for
Employees was duly adopted by the Board on February 12, 1996.
----------------------------
Secretary
12
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APPENDIX B
HOME SHOPPING NETWORK, INC.
1996 STOCK OPTION PLAN FOR OUTSIDE DIRECTORS
I. Purpose
It is the belief of the management of Home Shopping Network, Inc. (the
"Company") that the Board of Directors will effect decisions and render
guidance to the Company which materially enhance the economic growth of the
Company and provide material benefit to the Company. Accordingly, management
believes that Directors should be afforded the opportunity to participate in
the Company's growth by acquiring the Company's Common Stock on a regular
basis. By providing this opportunity through the adoption of this Stock Option
Plan for Outside Directors (the "Plan"), it is the intention of the Company to
give appropriate recognition to these individuals who will have continuing
responsibility for the Company's growth and profitability.
II. Eligibility
The only persons eligible to receive options (the "Options") for the
Company's common stock, $.01 par value ("Stock") under the Plan shall be the
Company's existing and future Directors who are not also employees of the
Company.
III. Shares Subject to the Plan
The maximum number of shares of Stock which may be issued upon
exercise of Options granted under the Plan and under the Company's 1996 Stock
Option Plan for Employees shall not exceed 18,700,000 shares. If any Option
expires or terminates prior to being fully exercised, any shares of Stock
allocable to the unexercised portion of such Option may again be issued subject
to the terms of the Plan.
Appropriate adjustments shall be made in the number of shares of Stock
available under the Plan and in the Option price per share to give effect to
adjustments necessary as a result of a merger, consolidation, recapitalization,
reclassification, combination, stock dividend, stock split or other relevant
change in the capital structure of the Company. Such adjustments shall be
determined by the Board of Directors in their good faith determination; to the
maximum extent possible, such adjustments shall be consistent with adjustments
made to options granted under the Company's 1996 Stock Option Plan for
Employees.
IV. Terms and Conditions
(a) Grant of Options
Subject to the provisions of the Plan, Directors of the
Company shall be granted Nonqualified Stock Options for the
purchase of shares of Stock as set forth in the Plan.
<PAGE> 2
(b) Option Agreement
Each Option shall be evidenced by a written agreement between
the Company and the Director specifying the number of shares
of Stock that may be exercised by its purchase, and containing
such other terms and provisions as may be approved by the
Board of Directors.
(c) Date of Grant
The date on which an Option is granted shall be: (1) the first
day upon which a Director who is not also an employee is first
elected to the Board of Directors, or (2) the date on which an
Option is issued in substitution for an option previously
granted under the Plan or an Option previously granted that is
subsequently amended, or (3) the anniversary of the date on
which a Director was elected to the Board of Directors.
(d) Option Price
Each Option Agreement shall state the purchase price of each
share of Stock which may be acquired upon exercising the
Option, which price shall be the fair market value of each
share as of the Date of Grant. Fair Market Value shall be
deemed to be the closing price of the shares on the New York
Stock Exchange, Inc. (or any other national securities
exchange on which the shares are traded) on the trading day
preceding the Date of Grant.
(e) Number of Shares Granted
(1) Each Director shall receive a Nonqualified Stock
Option to purchase 5,000 shares of Stock
automatically on the date specified in paragraph (c)
of this Article IV, exercisable in accordance with
the provisions of paragraph (f) (1) of this Article
IV.
(2) Each Director shall receive a Nonqualified Stock
Option to purchase an additional 5,000 shares of
Stock automatically on the date that such Director
commences his second year of service as a director,
and an additional 5,000 shares on the date that he
commences each year of service as a director
thereafter.
(f) Option Period and Restrictions of Exercise
(1) The Options granted pursuant to paragraph (e) shall
be exercisable in the following manner for the
periods specified: Options for 1,668 shares of the
Stock shall first become exercisable on the date the
Options are granted and
2
<PAGE> 3
must be fully exercised within five years from
that date. Options for an additional 1,666 shares of
the Stock shall become exercisable on the first and
second anniversary of the date the Options were
granted; such Options must be exercised within five
years from the date they first become exercisable.
Any Options which are not exercised within the
five year periods specified above shall expire.
(g) Manner of Exercise
Subject to the conditions and restrictions contained in
paragraph IV (h) below, the Option shall be exercised by
delivering written notice of exercise to the Secretary or
Treasurer of the Company. Such notice is irrevocable and must
be accompanied by payment in cash and a signed Option exercise
form.
(h) Payment of Option Exercise Price
(1) Forms of Consideration Authorized. Except as
otherwise provided below, payment of the exercise
price for the number of shares of Stock being
purchased pursuant to any Option shall be made (i) in
cash, by check, or cash equivalent, (ii) by tender to
the Company of shares of Stock owned by the Optionee
having a Fair Market Value (as determined by the
Company without regard to any restrictions on
transferability applicable to such stock by reason of
federal or state securities laws or agreements with
an underwriter for the Company) not less than the
exercise price, (iii) by the assignment of the
proceeds of a sale or loan with respect to some or
all of the shares being acquired upon the exercise of
the Option (including, without limitation, through an
exercise complying with the provisions of Regulation
T as promulgated from time to time by the Board of
Governors of the Federal Reserve System) (a "Cashless
Exercise"), or (iv) by any combination thereof.
(2) Tender of Stock. Notwithstanding the foregoing, an
Option may not be exercised by tender to the Company
of shares of Stock to the extent such tender of Stock
would constitute a violation of the provisions of any
law, regulation or agreement restricting the
redemption of the Company's stock. An Option may not
be exercised by tender to the Company of shares of
Stock unless such shares either have been owned by
the Optionee for more than six (6) months.
3
<PAGE> 4
(3) Cashless Exercise. The Company reserves, at any and
all times, the right, in the Company's sole and
absolute discretion, to establish, decline to
approve or terminate any program or procedures for
the exercise of Options by means of a Cashless
Exercise.
(i) Tax Withholding
The Company shall have the right, but not the obligation, to
deduct from the shares of Stock issuable upon the exercise of
an Option, or to accept from the Optionee the tender of, a
number of whole shares of Stock having a Fair Market Value, as
determined by the Company, equal to all or any part of the
federal, state, local and foreign taxes, if any, required by
law to be withheld by the Company with respect to such Option
exercise. Alternatively, or in addition, in its sole
discretion, the Company shall have the right to require the
Optionee, through cash payment or otherwise, including by
means of a Cashless Exercise, to make adequate provision for
any such tax withholding obligations of the Company arising in
connection with the Option exercise. The Company shall have
no obligation to deliver shares of Stock, money or to release
shares of Stock from an escrow established pursuant to the
Option Agreement until the Company's tax withholding
obligations have been satisfied by the Optionee.
(j) Transferability and Termination of Option
Each Option granted hereunder may be exercised only by the
individual to whom it is issued and only during the period in
which he or she is serving as an outside Director of the
Company or within the thirty (30) day period following his or
her resignation or other termination of such service for any
reason other than death. If such holder dies before fully
exercising any portion of an option then exercisable, such
Option may be exercised by such holder's legal
representative(s), heir(s) or devisee(s) at any time within
the six (6) month period following his or her death.
(k) Director Becoming Employee
In the event that an outside Director becomes a full-time
employee of the Company, the outside Director shall not
forfeit the Options granted pursuant to this Plan. However,
the outside Director shall have to satisfy all other terms and
provisions of this Plan with respect to the Options granted
hereunder.
(l) Modification or Substitution of Options
Subject to the terms and conditions and within the limitations
of the Plan, the members of the Board of Directors who are not
eligible to participate in the Plan may
4
<PAGE> 5
modify outstanding Options granted under the Plan or
accept the surrender and cancellation of outstanding
Options and authorize the granting of new Options in
substitution therefor. The foregoing notwithstanding, no
modification, cancellation or substitution of an Option
pursuant to this section shall alter or impair any rights or
obligations under any Option theretofore granted under the Plan
and no modification, cancellation or substitution may serve to
increase the aggregate number of securities which may be issued
under the Plan.
V. Effective Date and Term of Plan; Shareholder Approval
Subject to the approval of the Plan by an affirmative vote of the
holders of a majority of the Company's outstanding stock entitled to vote
thereon at the Annual Meeting of Shareholders to be conducted on May 9, 1996,
the effective date of the Plan shall be May 10, 1996, and it shall remain in
existence for a period of ten years thereafter. In the event of shareholder
rejection of the Plan, any Option granted hereunder shall be void and of no
legal effect. No Option may be granted subsequent to the expiration date of
the Plan, but Options then outstanding shall be exercisable in accordance with
the terms hereof.
Any increase in the maximum number of shares of Stock issuable
hereunder as provided in Article III (the "Maximum Shares") shall be approved
by the shareholders of the Company within twelve (12) months of the date of
adoption thereof by the Board. Options granted prior to shareholder approval
of the Plan, or in excess of the Maximum Shares previously approved by the
shareholders, shall become exercisable no earlier than the date of shareholder
approval of the Plan or such increase in the Maximum Shares, as the case may
be.
On the Effective Date of the Plan, it shall supersede the 1986 Stock
Option Plan for Outside Directors, which shall terminate on that date.
VI. Amendment
The Board of Directors may at any time suspend or discontinue the
Plan, but no amendment shall be authorized without shareholder approval which
(i) materially increases the benefits accruing to participants under the Plan;
(ii) materially increases the number of securities which may be issued under
the Plan, except as otherwise provided in Article III; or (iii) materially
modifies the requirements as to eligibility for participation in the Plan.
VII. Rights as Shareholders
No Optionee, nor any beneficiary or other person claiming through an
Optionee, shall have any interest in any shares of Stock allocated for the
purposes of the Plan or subject to any Option until such shares of Stock
shall have been issued to the Optionee or such beneficiary or other person.
Furthermore, the existence of the Options shall not affect the right or power
of the Company or its shareholders to make adjustments, recapitalization,
reorganizations, or other changes in the
5
<PAGE> 6
Company's capital structure or its business; issue bonds, debentures, preferred
or prior preference stocks affecting the Stock of the Company or the rights
thereof; dissolve the Corporation or sell or transfer any part of its assets or
business; or do any other corporate act, whether of a similar character or
otherwise.
VIII. Choice of Law
The validity, interpretation, and administration of the Plan and of
any rules, regulations, determinations, or decisions made thereunder, and the
rights of any and all persons having or claiming to have any interest therein
or thereunder, shall be determined exclusively in accordance with the laws of
the State of Florida, without giving effect to choice of law principles
thereof. Without limiting the generality of the foregoing, the period within
which any action in connection with the Plan must be commenced shall be
governed by the Laws of the State of Florida without regard to the place where
the act or omission complained of took place or the residence of any party to
such action. Any action in connection with the Plan must be brought in the
State of Florida, in the County of Pinellas or Hillsborough.
IN WITNESS WHEREOF, the undersigned Secretary of the Company certifies
that the foregoing Home Shopping Network, Inc. 1996 Stock Option Plan for
Outside Directors was duly adopted by the Board on February 12, 1996.
----------------------------
Secretary
6
<PAGE> 1
May 9, 1996
Home Shopping Network, Inc.
11831 30th Court North
St. Petersburg, Florida 33716
RE: VALIDITY OF COMMON STOCK
Ladies and Gentlemen:
We act as special counsel for Home Shopping Network, Inc., a Delaware
corporation (the "Company") for purposes of 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 18,700,000 shares of common stock (the "Common
Stock") of Company pursuant to the Home Shopping Network, Inc. 1996 Stock
Option Plan for Employees and the Home Shopping Network, Inc. 1996 Stock Option
Plan for Outside Directors (collectively, the "Plans"). We have not been
engaged by the Company in any other capacity regarding the preparation and
filing of the Registration Statement.
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 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 Plans. In addition, we
have reviewed such other documents and instruments and have conferred with
various employees of the Company and have ascertained or verified to our
satisfaction such additional facts with respect to
<PAGE> 2
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
under the Plans will be the same as such laws, rules and regulations in effect
as of the date hereof.
We are the members of the Bar of the District of Columbia. We have
made such examination of federal law and of the Delaware General Corporation
Law as we have deemed relevant for purposes of this opinion, and we express no
opinion as to laws of any other state or jurisdiction.
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 Plans, 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,
Baker & McKenzie
<PAGE> 1
EXHIBIT 23
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Home Shopping Network, Inc.
We consent to the incorporation by reference herein.
KPMG Peat Marwick LLP
St. Petersburg, Florida
May 9, 1996
