Discovery Performance Equity Program Nonqualified Stock Option Grant Agreement for John Hendricks

EXECUTION COPY
Plan: 2008SO7YR

Discovery Performance Equity Program
Nonqualified Stock Option Grant Agreement for ▇▇▇▇ ▇▇▇▇▇▇▇▇▇

Discovery Communications, Inc. (the “Company”) has granted you an option (the “Option”) under the Discovery Communications, Inc. 2005 Incentive Plan (As Amended and Restated) (the “Plan”), under which the Company now makes equity grants after the transactions that closed on September 17, 2008. The Company’s general program to offer equity and equity-type awards to eligible employees is referred to as the “Performance Equity Program” (or “PEP”). The Option lets you purchase a specified number (the “Option Shares”) of shares of the Company’s Series A common stock, at a specified price per share (the “Exercise Price”).

The individualized communication you received (the “Cover Letter”) provides the details for your Option. It specifies the number of Option Shares, the Exercise Price, the Date of Grant, the schedule for exercisability, and the latest date the Option will expire (the “Term Expiration Date”).

The Option is subject in all respects to the applicable provisions of the Plan. This Grant Agreement does not cover all of the rules that apply to the Option under the Plan; please refer to the Plan document. Capitalized terms are defined either further below in this grant agreement (the “Grant Agreement”) or in the Plan.

The Plan document is available on Fidelity’s web site. The Prospectus for the Plan, the Company’s S-4 and Annual Report on Form 10-K, and other filings the Company makes with the Securities and Exchange Commission are available for your review on the Company’s web site. You may also obtain paper copies of these documents upon request to the Company’s HR department.

Neither the Company nor anyone else is making any representations or promises regarding the duration of your service, exercisability of the Option, the value of the Company’s stock or of this Option, or the Company’s prospects. The Company is not providing any advice regarding tax consequences to you or regarding your decisions regarding the Option; you agree to rely only upon your own personal advisors.

No one may sell, transfer, or distribute the Option or the securities that may be purchased upon exercising the Option without an effective registration statement relating thereto or an opinion of counsel satisfactory to Discovery Communications, Inc. or other information and representations satisfactory to it that such registration is not required.

1

In addition to the Plan’s terms and restrictions, the following terms and restrictions apply:

The Option will become exercisable on the schedule provided in the Cover Letter to this Grant Agreement, assuming you remain employed through each Exercisability Date. Any fractional shares will be carried forward to the following Exercisability Date, unless the Committee selects a different treatment.

Exercisability will accelerate fully on your Retirement or termination by the Company without Cause, or, while employed, your Disability or death. “Cause” and “Disability” have the meanings provided in the Equity Stake Transition Agreement entered into between the Company and you, dated as of September      , 2008 (as it may be amended from time to time) (the “Equity Stake Transition Agreement”). “Retirement” means your voluntary termination of employment after you reach age 65.

Change in Control

Notwithstanding the Plan’s provisions, if an Approved Transaction, Control Purchase, or Board Change (each a “ Change in Control”) occurs while you remain employed by the Company, the Option will only have accelerated exercisability to the extent provided above as a result of a termination without Cause, Retirement, death, or Disability.

The Committee reserves its ability under Section 11.1(b) of the Plan to vary this treatment if the Committee determines there is an equitable substitution or replacement award in connection with a Change in Control.

Option Expiration You cannot exercise the Option after it has expired. The Option will expire no later than the close of business on the Term Expiration Date. If any portion of the Option is not exercisable as of the date your employment with the Company terminates (and the termination of employment has not accelerated the exercisability of the Option, as described in the Option Exercisability Section, above), then the unexercisable portion of the Option will expire immediately. The portion of the Option that is permitted to be exercised following termination of your employment, will remain exercisable until the first to occur of the following (each as defined further in the Plan or the Grant Agreement):

•

If your employment terminates for Cause, then the Option will expire immediately;

•

If your employment terminates because you resign, other than for Retirement, the Option will expire on the close of business on the first anniversary of the date your employment terminated (but not later than the Term Expiration Date); and

•

If your employment terminates because of your death, Disability, Retirement, or termination without Cause, then the Option will expire on the close of business on the Term Expiration Date.

Post-Employment You may not exercise the then exercisable portions of the Option after

Restrictions your employment ends unless you sign a general liability release (the “Release”) and abide by the non-competition agreement (the “Noncompetition Agreement”), each as provided in the Equity Stake Transition Agreement. If you do not timely sign (or you do revoke) the Release or if you breach the Non-Competition Agreement, then you cannot exercise the Option after the date of employment termination (the “Exercise Prohibition”). If you have exercised the Option before the Company notifies you that it is invoking the Exercise Prohibition, the Company may in its discretion require you to immediately pay any gains you recognized from the post-termination exercise of the Option to the Company, as provided below.

You agree that, within 10 days after receiving from the Company written notification that the Compensation Committee has determined in good faith that the Exercise Prohibition applies, you will pay to the Company for each Option Share obtained after employment ends, an amount (the “Option Gain”) equal to the excess, if any, of (i) the Fair Market Value of the Option Share on the exercise date upon which it was acquired, over (ii) the Exercise Price you paid. The Option Gain will be determined without regard to any market price increase or decrease after the respective exercise date.

You acknowledge that your engaging in behavior that triggers an Exercise Prohibition will result in a loss to the Company that cannot reasonably or adequately be compensated in damages in an action at law, that a failure to sign the Release (or a revocation of it) or a breach of the Non-Competition Agreement will result in irreparable and continuing harm to the Company and that therefore, in addition to and cumulative with any other remedy that the Company may have at law or in equity, the Company will be entitled to injunctive relief in connection with such actions. You acknowledge and agree that the recoupment provisions in this section are not a provision for liquidated damages.

Cash/Check cash or check in the amount of the Exercise Price payable to the order of the Company; or

Cashless an approved cashless exercise method, including directing the Company

Exercise to send the stock certificates (or other acceptable evidence of ownership) to be issued under the Option to a licensed broker acceptable to the Company as your agent in exchange for the broker’s tendering to the Company cash (or acceptable cash equivalents) equal to the Exercise Price and, if you so elect, any required tax withholdings.

The Committee can approve additional payment methods, including use of a fully or partially recourse promissory note, subject to any prohibitions of applicable law.

its completing or amending any securities registration or qualification of the Option Shares or its or your satisfying any exemption from registration under any Federal or state law, rule, or regulation;

its receiving proof it considers satisfactory that a person seeking to exercise the Option after your death is entitled to do so;

your complying with any requests for representations under the Plan; and

your complying with any Federal, state, or local tax withholding obligations.

represent to the Company, in a manner satisfactory to the Company’s counsel, that you are acquiring the Option Shares for your own account and not with a view to reselling or distributing the Option Shares; and

agree that you will not sell, transfer, or otherwise dispose of the Option Shares unless:

a registration statement under the Act is effective at the time of disposition with respect to the Option Shares you propose to sell, transfer, or otherwise dispose of; or

the Company has received an opinion of counsel or other information and representations it considers satisfactory to the effect that, because of Rule 144 under the Act or otherwise, no registration under the Act is required.

2