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EXHIBIT 10.45
1998 PLAN
TCOMA 9/3/98 GRANT
TELE-COMMUNICATIONS, INC.
1998 INCENTIVE PLAN
NON-QUALIFIED STOCK OPTION AND
STOCK APPRECIATION RIGHTS AGREEMENT
THIS AGREEMENT ("Agreement") is made as of the 1st day of
March, 1999 (the "Grant Date"), by and between TELE-COMMUNICATIONS, INC., a
Delaware corporation (the "Company"), and the person signing adjacent to the
caption "Grantee" on the signature page hereof (the "Grantee").
The Company has adopted the Tele-Communications, Inc. 1998
Incentive Plan (the "Plan"), a copy of which is appended to this Agreement as
Exhibit A and by this reference made a part hereof, for the benefit of eligible
employees of the Company and its Subsidiaries. Capitalized terms used and not
otherwise defined herein shall have the meaning ascribed thereto in the Plan.
Pursuant to the Plan, the Compensation Committee of the Board
(the "Committee"), which has been assigned responsibility for administering the
Plan, has determined that it would be in the interest of the Company and its
stockholders to grant the options and rights provided herein in order to
provide Grantee with additional remuneration for services rendered, to
encourage Grantee to remain in the employ of the Company or its Subsidiaries
and to increase Grantee's personal interest in the continued success and
progress of the Company.
The Company and Grantee therefore agree as follows:
1. GRANT OF OPTION. Subject to the terms and conditions herein, the
Company grants to the Grantee during the period commencing on March 1, 1999.
and expiring at 5:00 p.m., Denver, Colorado time ("Close of Business") on
September 3, 2008 (the "Option Term"), subject to earlier termination as
provided in paragraphs 8 and 12(b) below, an option to purchase from the
Company, at the price per share set forth on Schedule 1 hereto (the "TCOMA
Option Price"), the number of shares of Series A TCI Group Common Stock
("TCOMA") set forth on said Schedule 1 (the "TCOMA Option Shares"). The TCOMA
Option Price and TCOMA Option Shares are subject to adjustment pursuant to
paragraph 12 below. This option is a "Nonqualified Stock Option" and is
hereinafter referred to as the "TCOMA Option".
2. GRANT OF STOCK APPRECIATION RIGHTS. Subject to the terms and
conditions herein and in tandem with the TCOMA Option, the Grantee shall also
have, during the TCOMA Option Term, subject to earlier termination as provided
in paragraphs 8 and 12(b) below, a stock appreciation right with respect to
each TCOMA Option Share (individually, a "TCOMA Tandem
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SAR" and collectively, the "TCOMA Tandem SARs"). Upon exercise of a TCOMA
Tandem SAR in accordance with this Agreement, the Company shall, subject to
paragraph 6 below, make payment as follows:
(a) the amount of payment shall equal the amount by which the
Fair Market Value of the TCOMA Option Share on the date of exercise
exceeds the TCOMA Option Price; and
(b) payment of the amount determined in accordance with
clause (i) shall be made in shares of TCOMA (valued at their Fair
Market Value as of the date of exercise of such TCOMA Tandem SAR), or,
in the sole discretion of the Compensation Committee of the Board of
Directors of the Company (the "Committee"), in cash, or partly in cash
and partly in shares of TCOMA.
3. REDUCTION UPON EXERCISE. The exercise of any number of TCOMA Tandem
SARs shall cause a corresponding reduction in the number of TCOMA Option Shares
which shall apply against the TCOMA Option Shares then available for purchase.
The exercise of the TCOMA Option to purchase any number of TCOMA Option Shares
shall cause a corresponding reduction in the number of TCOMA Tandem SARs.
4. CONDITIONS OF EXERCISE. The TCOMA Option and TCOMA Tandem SARs are
exercisable only in accordance with the conditions stated in this paragraph.
(a) Except as otherwise provided in paragraph 12(b) below or
in the last sentence of this subparagraph (a), the TCOMA Option shall
not be exercisable until September 3, 1999, and the TCOMA Option may
only be exercised to the extent the TCOMA Option Shares have become
available for purchase in accordance with the following schedule:
Percentage of TCOMA Option
Date Shares Available for Purchase
---- -----------------------------
September 3, 1999 20%
September 3, 2000 40%
September 3, 2001 60%
September 3, 2002 80%
September 3, 2003 100%
Notwithstanding the foregoing, all TCOMA Option Shares shall become
available for purchase if Grantee's employment with the Company and
its Subsidiaries (i) shall terminate by reason of (x) termination by
the Company without cause (as defined in Section 11.2(b) of the Plan),
(y) termination by Grantee for good reason (as defined herein) or (z)
Disability, (ii) shall terminate pursuant to provisions of a written
employment agreement, if any, between the Grantee and the Company
which expressly
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permit the Grantee to terminate such employment upon the occurrence of
specified events (other than the giving of notice and passage of
time), or (iii) if Grantee dies while employed by the Company or a
Subsidiary.
(b) A TCOMA Tandem SAR with respect to an TCOMA Option Share
shall be exercisable only if the TCOMA Option Share is then available
for purchase in accordance with subparagraph (a).
(c) To the extent the TCOMA Option or TCOMA Tandem SARs
become exercisable, such TCOMA Option or TCOMA Tandem SARs may be
exercised in whole or in part (at any time or from time to time,
except as otherwise provided herein) until expiration of the TCOMA
Option Term or earlier termination thereof.
(d) Grantee acknowledges and agrees that the Committee may,
in its discretion and as contemplated by Section 7.5 of the Plan,
adopt rules and regulations from time to time after the date hereof
with respect to the exercise of TCOMA SARs and that the exercise by
Grantee of the TCOMA Tandem SARs will be subject to the further
condition that such exercise is made in accordance with all such rules
and regulations as the Committee may determine are applicable thereto.
5. MANNER OF EXERCISE. The TCOMA Option or a TCOMA Tandem SAR shall be
considered exercised (as to the number of TCOMA Option Shares or TCOMA Tandem
SARs specified in the notice referred to in subparagraph (a) below) on the
latest of (i) the date of exercise designated in the written notice referred to
in subparagraph (a) below, (ii) if the date so designated is not a business
day, the first business day following such date or (iii) the earliest business
day by which the Company has received all of the following:
(a) Written notice, in such form as the Committee may
require, designating, among other things, the date of exercise, the
number of TCOMA Option Shares to be purchased and/or the number of
TCOMA Tandem SARs to be exercised;
(b) If the TCOMA Option is to be exercised, payment of the
TCOMA Option Price for each TCOMA Option Share to be purchased in cash
or in such other form, or combination of forms, of payment
contemplated by Section 6.6(a) of the Plan as the Committee may
permit; provided, however, that any shares of TCOMA (or, if
applicable, shares of Series B TCI Group Common Stock ("TCOMB"))
delivered in payment of the TCOMA Option Price, if such form of
payment is so permitted by the Committee, shall be shares that the
Grantee has owned for a period of at least six months prior to the
date of exercise, and provided, further, that, notwithstanding clause
(vii) of Section 6.6(a) of the Plan, TCOMA Option Shares may not be
withheld in payment or partial payment of the TCOMA Option Price; and
(c) Any other documentation that the Committee may reasonably
require.
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6. MANDATORY WITHHOLDING FOR TAXES. Grantee acknowledges and agrees
that the Company shall deduct from the cash and/or shares of TCOMA (or, if
applicable, shares of TCOMB) otherwise payable or deliverable upon exercise of
the TCOMA Option or a TCOMA Tandem SAR an amount of cash and/or number of
shares of TCOMA (valued at their Fair Market Value on the date of exercise)
that is equal to the amount of all federal, state and local taxes required to
be withheld by the Company upon such exercise, as determined by the Committee.
7. DELIVERY BY THE COMPANY. As soon as practicable after receipt of
all items referred to in paragraph 5, and subject to the withholding referred
to in paragraph 6, the Company shall deliver to the Grantee certificates issued
in Grantee's name for the number of TCOMA Option Shares purchased by exercise
of the TCOMA Option and for the number of shares of TCOMA to which the Grantee
is entitled by the exercise of TCOMA Tandem SARs and any cash payment to which
the Grantee is entitled by the exercise of TCOMA Tandem SARs. If delivery is by
mail, delivery of shares of TCOMA shall be deemed effected for all purposes
when a stock transfer agent of the Company shall have deposited the
certificates in the United States mail, addressed to the Grantee, and any cash
payment shall be deemed effected when a Company check, payable to Grantee and
in an amount equal to the amount of the cash payment, shall have been deposited
in the United States mail, addressed to the Grantee.
8. EARLY TERMINATION OF OPTION AND TANDEM SARS. Unless otherwise
determined by the Committee in its sole discretion, the TCOMA Option and TCOMA
Tandem SARs shall terminate, prior to the expiration of the TCOMA Option Term,
at the time specified below:
(a) If Grantee's employment with the Company and its
Subsidiaries terminates (i) other than (x) by the Company for "cause"
(as defined in Section 11.2(b) of the Plan), (y) by the Grantee with
"good reason" (as defined herein) or (z) by the Company without cause,
and (ii) other than (x) by reason of death or Disability, (y) with the
written consent of the Company or the applicable Subsidiary or (z)
without such consent if such termination is pursuant to provisions of
a written employment agreement, if any, between the Grantee and the
Company which expressly permit the Grantee to terminate such
employment upon the occurrence of specified events (other than the
giving of notice and passage of time), then the TCOMA Option and all
TCOMA Tandem SARs shall terminate at the Close of Business on the
first business day following the expiration of the 90-day period which
began on the date of termination of Grantee's employment;
(b) If Grantee dies while employed by the Company or a
Subsidiary, or prior to the expiration of a period of time following
termination of Grantee's employment during which the TCOMA Option and
TCOMA Tandem SARs remain exercisable as provided in paragraph (a), the
TCOMA Option and all TCOMA Tandem SARs shall terminate at the Close of
Business on the first business day following the expiration of the
one-year period which began on the date of death;
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(c) If Grantee's employment with the Company and its
Subsidiaries terminates by reason of Disability, then the TCOMA Option
and all TCOMA Tandem SARs shall terminate at the Close of Business on
the first business day following the expiration of the one-year period
which began on the date of termination of Grantee's employment;
(d) If Grantee's employment with the Company and its
Subsidiaries is terminated by the Company for "cause" (as defined in
Section 11.2(b) of the Plan), then the TCOMA Option and all TCOMA
Tandem SARs shall terminate immediately upon such termination of
Grantee's employment; or
(e) If Grantee's employment (i) is terminated by Grantee (x)
with "good reason" (as defined herein), (y) with the written consent
of the Company or the applicable Subsidiary or (z) pursuant to
provisions of a written employment agreement, if any, between the
Grantee and the Company which expressly permit the Grantee to
terminate such employment upon the occurrence of specified events
(other than the giving of notice and passage of time), or (ii) by the
Company without "cause" (as defined in Section 11.2(b) of the Plan),
then the TCOMA Option Term shall terminate early only as provided for
in paragraph 8(b) above or 12(b) below.
In any event in which the TCOMA Option and TCOMA Tandem SARs
remain exercisable for a period of time following the date of termination of
Grantee's employment as provided above, the TCOMA Option and TCOMA Tandem SARs
may be exercised during such period of time only to the extent the same were
exercisable as provided in paragraph 4 above on such date of termination of
Grantee's employment. A change of employment is not a termination of employment
within the meaning of this paragraph 8 provided that, after giving effect to
such change, the Grantee continues to be an employee of the Company or any
Subsidiary. Notwithstanding any period of time referenced in this paragraph 8
or any other provision of this paragraph that may be construed to the contrary,
the TCOMA Option and all TCOMA Tandem SARs shall in any event terminate upon
the expiration of the Option Term.
"Good reason" for purposes of the Agreement shall be deemed
to have occurred upon the happening of any of the following:
(i) any reduction in Grantee's annual rate of salary;
(ii) either (x) a failure of the Company to continue in
effect any employee benefit plan in which Grantee was participating or
(y) the taking of any action by the Company that would adversely
affect Grantee's participation in, or materially reduce Grantee's
benefits under, any such employee benefit plan, unless such failure or
such taking of any action, adversely affects the senior members of the
corporate management of the Company generally;
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(iii) the assignment to Grantee of duties and
responsibilities that are materially more oppressive or onerous than
those attendant to Grantee's position immediately after the date
hereof;
(iv) the relocation of the office location as assigned to
Grantee by the Company to a location more than 20 miles from Grantee's
then current location without Grantee's consent; or
(v) the failure of the Company to obtain, prior to the time
of any reorganization, merger, consolidation, disposition of all or
substantially all of the assets of the Company or similar transaction
effective after the date hereof, in which the Company is not the
surviving person, the unconditional assumption in writing or by
operation of law of the Company's obligations to Grantee under this
Agreement by each direct successor to the Company in any such
transaction.
9. AUTOMATIC EXERCISE OF TCOMA TANDEM SARS. Immediately prior to the
termination of the TCOMA Option, as provided in paragraph 8 above, or the
expiration of the Option Term, all remaining TCOMA Tandem SARs shall be deemed
to have been exercised by the Grantee.
10. NONTRANSFERABILITY OF TCOMA OPTION AND TCOMA TANDEM SARS. During
Grantee's lifetime, the TCOMA Option and TCOMA Tandem SARs are not transferable
(voluntarily or involuntarily) other than pursuant to a domestic relations
order and, except as otherwise required pursuant to a domestic relations order,
are exercisable only by the Grantee or Grantee's court appointed legal
representative. The Grantee may designate a beneficiary or beneficiaries to
whom the TCOMA Option and TCOMA Tandem SARs shall pass upon Grantee's death and
may change such designation from time to time by filing a written designation
of beneficiary or beneficiaries with the Committee on the form annexed hereto
as Exhibit B or such other form as may be prescribed by the Committee, provided
that no such designation shall be effective unless so filed prior to the death
of Grantee. If no such designation is made or if the designated beneficiary
does not survive the Grantee's death, the TCOMA Option and TCOMA Tandem SARs
shall pass by will or the laws of descent and distribution. Following Grantee's
death, the TCOMA Option and any TCOMA Tandem SARs, if otherwise exercisable,
may be exercised by the person to whom such option or right passes accordingly
to the foregoing and such person shall be deemed the Grantee for purposes of
any applicable provisions of this Agreement.
11. NO SHAREHOLDER RIGHTS. The Grantee shall not be deemed for any
purpose to be, or to have any of the rights of, a stockholder of the Company
with respect to any shares of TCOMA as to which this Agreement relates until
such shares shall have been issued to Grantee by the Company. Furthermore, the
existence of this Agreement shall not affect in any way the right or power of
the Company or its stockholders to accomplish any corporate act, including,
without limitation, the acts referred to in Section 11.18 of the Plan.
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12. ADJUSTMENTS.
(a) The TCOMA Option and TCOMA Tandem SARs shall be subject
to adjustment (including, without limitation, as to the number of
TCOMA Option Shares and the TCOMA Option Price per share) in the sole
discretion of the Committee and in such manner as the Committee may
deem equitable and appropriate in connection with the occurrence of
any of the events described in Section 4.2 of the Plan following the
Grant Date.
(b) In the event of any Approved Transaction, Board Change or
Control Purchase, the TCOMA Option and all TCOMA Tandem SARs shall
become exercisable in full without regard to paragraph 4(a); provided,
however, that to the extent not theretofore exercised the TCOMA Option
and all TCOMA Tandem SARs shall terminate upon the first to occur of
the consummation of the Approved Transaction, the expiration of the
TCOMA Option Term or the earlier termination of the TCOMA Option and
TCOMA Tandem SARs pursuant to paragraph 8 hereof. Notwithstanding the
foregoing, the Committee may, in its discretion, determine that the
TCOMA Option and TCOMA Tandem SARs will not become exercisable on an
accelerated basis in connection with an Approved Transaction and/or
will not terminate if not exercised prior to consummation of the
Approved Transaction, if the Board or the surviving or acquiring
corporation, as the case may be, shall have taken or made effective
provision for the taking of such action as in the opinion of the
Committee is equitable and appropriate to substitute a new Award for
the Award evidenced by this Agreement or to assume this Agreement and
the Award evidenced hereby and in order to make such new or assumed
Award, as nearly as may be practicable, equivalent to the Award
evidenced by this Agreement as then in effect (but before giving
effect to any acceleration of the exercisability hereof unless
otherwise determined by the Committee), taking into account, to the
extent applicable, the kind and amount of securities, cash or other
assets into or for which the TCOMA may be changed, converted or
exchanged in connection with the Approved Transaction.
13. RESTRICTIONS IMPOSED BY LAW. Without limiting the generality of
Section 11.9 of the Plan, the Grantee agrees that Grantee will not exercise the
TCOMA Option or any TCOMA Tandem SAR and that the Company will not be obligated
to deliver any shares of TCOMA or make any cash payment, if counsel to the
Company determines that such exercise, delivery or payment would violate any
applicable law or any rule or regulation of any governmental authority or any
rule or regulation of, or agreement of the Company with, any securities
exchange or association upon which the TCOMA is listed or quoted. The Company
shall in no event be obligated to take any affirmative action in order to cause
the exercise of the TCOMA Option or any TCOMA Tandem SAR or the resulting
delivery of shares of TCOMA or other payment to comply with any such law, rule,
regulation or agreement.
14. NOTICE. Unless the Company notifies the Grantee in writing of a
different procedure or address for the Company, any notice or other
communication to the Company with respect to this Agreement shall be in writing
and shall be:
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(a) delivered personally to the following address:
Tele-Communications, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
or
(b) sent by first class mail, postage prepaid and addressed
as follows:
Tele-Communications, Inc.
c/o General Counsel, Tele-Communications, Inc.
P. O. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Any notice or other communication to the Grantee with respect to this Agreement
shall be in writing and shall be delivered personally, or shall be sent by
first class mail, postage prepaid, to Grantee's address as listed in the
records of the Company on the Grant Date, unless the Company has received
written notification from the Grantee of a change of address.
15. AMENDMENT. Notwithstanding any other provisions hereof, this
Agreement may be supplemented or amended from time to time as approved by the
Committee as contemplated by Section 11.8(b) of the Plan. Without limiting the
generality of the foregoing, without the consent of the Grantee,
(a) this Agreement may be amended or supplemented (i) to cure
any ambiguity or to correct or supplement any provision herein which
may be defective or inconsistent with any other provision herein, or
(ii) to add to the covenants and agreements of the Company for the
benefit of Grantee or surrender any right or power reserved to or
conferred upon the Company in this Agreement, subject, however, to any
required approval of the Company's stockholders and, provided, in each
case, that such changes or corrections shall not adversely affect the
rights of Grantee with respect to the Award evidenced hereby, or (iii)
to make such other changes as the Company, upon advice of counsel,
determines are necessary or advisable because of the adoption or
promulgation of, or change in or of the interpretation of, any law or
governmental rule or regulation, including any applicable federal or
state securities laws; and
(b) subject to Section 11.8(b) of the Plan and any required
approval of the Company's stockholders, the Award evidenced by this
Agreement may be cancelled by the Committee and a new Award made in
substitution therefor, provided that the Award so substituted shall
satisfy all of the requirements of the Plan as of the date such new
Award is made and no such action shall adversely affect the TCOMA
Option or any TCOMA Tandem SAR to the extent then exercisable.
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16. GRANTEE EMPLOYMENT. Nothing contained in this Agreement, and no
action of the Company or the Committee with respect hereto, shall confer or be
construed to confer on the Grantee any right to continue in the employ of the
Company or any of its Subsidiaries or interfere in any way with the right of
the Company or any employing Subsidiary to terminate the Grantee's employment
at any time, with or without cause; subject, however, to the provisions of any
employment agreement between the Grantee and the Company or any Subsidiary.
17. GOVERNING LAW. This Agreement shall be governed by, and construed
in accordance with, the internal laws of the State of Delaware.
18. CONSTRUCTION. References in this Agreement to "this Agreement" and
the words "herein," "hereof," "hereunder" and similar terms include all
Exhibits and Schedules appended hereto, including the Plan. This Agreement is
entered into, and the Award evidenced hereby is granted, pursuant to the Plan
and shall be governed by and construed in accordance with the Plan and the
administrative interpretations adopted by the Committee thereunder. All
decisions of the Committee upon questions regarding the Plan or this Agreement
shall be conclusive. Unless otherwise expressly stated herein, in the event of
any inconsistency between the terms of the Plan and this Agreement, the terms
of the Plan shall control. The headings of the paragraphs of this Agreement
have been included for convenience of reference only, are not to be considered
a part hereof and shall in no way modify or restrict any of the terms or
provisions hereof.
19. DUPLICATE ORIGINALS. The Company and the Grantee may sign any
number of copies of this Agreement. Each signed copy shall be an original, but
all of them together represent the same agreement.
20. RULES BY COMMITTEE. The rights of the Grantee and obligations of
the Company hereunder shall be subject to such reasonable rules and regulations
as the Committee may adopt from time to time hereafter.
21. ENTIRE AGREEMENT. This Agreement is in satisfaction of and in lieu
of all prior discussions and agreements, oral or written, between the Company
and Grantee regarding the subject matter hereof. Grantee and the Company hereby
declare and represent that no promise or agreement not herein expressed has
been made and that this Agreement contains the entire agreement between the
parties hereto with respect to the TCOMA Options and TCOMA Tandem SARs and
replaces and makes null and void any prior agreements between Grantee and the
Company regarding the TCOMA Options.
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22. GRANTEE ACCEPTANCE. Grantee shall signify acceptance of the terms
and conditions of this Agreement by signing in the space provided at the end
hereof and returning a signed copy to the Company.
TELE-COMMUNICATIONS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Executive Vice President
Secretary and General Counsel
ACCEPTED:
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Exhibit B to Non-Qualified Stock Option
and Stock Appreciation Rights Agreement
dated as of March 1, 1999
TELE-COMMUNICATIONS, INC. 1998 INCENTIVE PLAN
DESIGNATION OF BENEFICIARY
I, ______________________________ (the "Grantee"), hereby declare that
upon my death ____________________________________ (the "Beneficiary") of
Name
_____________________________________________________________________________,
Street Address City State Zip Code
who is my ___________________________________________, shall be entitled to the
Relationship to Grantee
TCOMA Option, TCOMA Tandem SARs and all other rights accorded the Grantee by
the above-referenced grant agreement (the "Agreement").
It is understood that this Designation of Beneficiary is made pursuant
to the Agreement and is subject to the conditions stated herein, including the
Beneficiary's survival of the Grantee's death. If any such condition is not
satisfied, such rights shall devolve according to the Grantee's will or the
laws of descent and distribution.
It is further understood that all prior designations of beneficiary
under the Agreement are hereby revoked and that this Designation of Beneficiary
may only be revoked in writing, signed by the Grantee, and filed with the
Company prior to the Grantee's death.
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Date Grantee
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