EXHIBIT 10.35
NONQUALIFIED STOCK OPTION AGREEMENT
FOR SENIOR PERSONNEL
AGREEMENT made as of the __ day of ________, 1997 (the "Grant Date"),
between Telemundo Group, Inc., a Delaware corporation (the "Company"), and
__________ (the "Optionee").
WHEREAS, the Company has adopted the 1994 Stock Plan (as the same may
be amended from time to time, the "Plan") in order to provide additional
incentive to certain officers and employees of the Company and its Subsidiaries;
and
WHEREAS, the Committee responsible for administration of the Plan has
determined to grant an option to the Optionee as provided herein;
NOW, THEREFORE, the parties hereto agree as follows:
1. GRANT OF OPTION.
1.1 The Company hereby grants to the Optionee the right and
option (the "Option") to purchase all or any part of an aggregate of [______]
whole shares of Stock subject to, and in accordance with, the terms and
conditions set forth in this Agreement.
1.2 The Option is not intended to qualify as an Incentive
Stock Option within the meaning of Section 422 of the Code.
1.3 This Agreement shall be construed in accordance and
consistent with, and subject to, the provisions of the Plan (the provisions of
which are incorporated herein by reference) and, except as otherwise expressly
set forth herein, the capitalized terms used in this Agreement shall have the
same definitions as set forth in the Plan.
2. PURCHASE PRICE.
The price at which the Optionee shall be entitled to purchase
shares of Stock upon the exercise of the Option shall be $______ per share.
3. DURATION OF OPTION.
Except as otherwise provided in this Agreement or the Plan, the
Option shall be exercisable to the extent and in the manner provided herein for
a period of ten years from the Grant Date (the "Exercise Term"); PROVIDED,
HOWEVER, that the Option may be earlier terminated as provided in Section 7
hereof.
4. EXERCISABILITY OF OPTION.
Unless otherwise provided in this Agreement or the Plan, the Option
shall entitle the Optionee to purchase, in whole at any time or in part from
time to time, shares of Stock covered by the Option to the extent the Option has
become "vested." Except as provided in
Section 7, the Option shall "vest" and be exercisable by the Optionee in
accordance with the following schedule (any such date of vesting referred to as
the "Vesting Date"):
PORTION OF GRANT VESTED ANNIVERSARY OF GRANT DATE
1/3 First
1/3 Second
1/3 Third
Each right of purchase shall be cumulative and shall continue,
unless sooner exercised or terminated as herein provided, during the remaining
period of the Exercise Term.
5. EFFECT OF CHANGE IN CONTROL.
5.1 Except as specifically provided otherwise herein or in the
Plan and provided that the Optionee is employed with the Company on the day
immediately preceding the Effective Date (as defined below), (A) in the event of
a Change of Control Transaction (as defined below) on or before the first
anniversary of the Grant Date, fifty percent (50%) of the Option shall vest and
be exercisable as of the Effective Date, with the remainder of the Option
vesting in accordance with the original vesting schedule (i.e., in one-third
increments on each of the three anniversaries immediately following the Grant
Date), and (B) in the event of a Change of Control Transaction following the
first anniversary of the Grant Date, one hundred percent (100%) of the Option
shall vest and be exercisable as of the Effective Date.
5.2 For purposes hereof, a "Change of Control Transaction"
means any one or more of the following events: (A) an event or series of events
after the date of this Agreement as a result of which any "person" or "group"
(as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) who did
not own at least 500,000 shares of the Company's Series B Common Stock on
September 1, 1997 becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of more than 50% of the aggregate
voting power of all of the capital stock of the Company normally entitled to
vote in the election of directors or (B) a sale, transfer, conveyance or other
disposition, directly or indirectly, in any single transaction or series of
related transactions, no matter how accomplished, which results in more than
50%, in value, of (1) the capital stock (or other equity interest in) or
operating assets of Telemundo Network, Inc., a wholly-owned subsidiary of the
Company or (2) the aggregate capital stock (or other equity interest in) or
operating assets of all of the Company's subsidiaries (other than Telemundo
Network, Inc.), which currently comprise the Company's owned and operated
station group (including any special purpose license subsidiaries), being owned
(which term shall include "beneficial ownership" within the meaning of Rule
13d-3 under the Exchange Act), directly or indirectly, by any "person" or
"group" (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act)
who did not own at least 500,000 shares of the Company's Series B Common Stock
on September 1, 1997 or (C) a transaction or series of related transactions
leading to at least an 80% reduction in the number of outstanding shares of
Stock held by "unaffiliated persons" (meaning any person other than Xxxxxxxxx
Partners, Apollo Partners, L.P. or Bastion Capital Fund, L.P. or any of their
respective affiliates (as this term is defined in Rule 12b-2 under the Exchange
Act) on the date of this Agreement.
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5.3 For purposes hereof, the "Effective Date" shall be the
first date on which a Change of Control Transaction occurs during the period of
time between the Grant Date and the third anniversary of the Grant Date;
provided that, if (1) the Optionee's employment with the Company is terminated
prior to the date on which a Change of Control Transaction occurs, (2) such
termination is not for Cause (as defined in that certain Change of Control
Severance Agreement, of even date herewith, between the Company, or a subsidiary
of the Company, and the Optionee and (3) it is reasonably demonstrated that such
termination of employment (A) was at the request of a third party who has taken
steps reasonably calculated to effect the Change of Control Transaction, or (B)
otherwise arose in connection with the Change of Control Transaction, then the
"Effective Date" shall mean the date immediately prior to the date of such
termination of employment.
5.4 Notwithstanding anything to the contrary contained herein,
if the Optionee is employed by the Company on the day immediately preceding the
Effective Date and, in connection with a Change of Control Transaction, (A) the
Company's Stock ceases to be listed for trading on the Nasdaq National Market or
on a national securities exchange AND (B) the Change of Control Transaction does
not involve (i) an exchange of the Company's Stock for common stock of the
acquiring company or the parent company of the acquiring company ("Acquirer
Stock"), (ii) the issuer of Acquirer Stock providing the Optionee with a
substitute option ("Substitute Option") to purchase Acquirer Stock, which
Substitute Option is substantially economically similar to the Option and (iii)
the Acquirer Stock being listed for trading on the Nasdaq National Market System
or on a national securities exchange, then one hundred percent (100%) of the
Option shall vest and be exercisable as of the Effective Date regardless of when
such Change of Control Transaction occurred. Additionally, in the case of a
Change of Control Transaction which also constitutes a Pooling Transaction, the
Board may take such actions which it determines, after consultation with its
advisors, are reasonably necessary in order to assure that the Pooling
Transaction will qualify as such, including, but not limited to, providing that
all Options specifically identified by the Committee shall not become
immediately and fully exercisable on the date of the Change of Control
Transaction but rather shall become immediately and fully exercisable on the
date following the last day of the Pooling Period (whether or not the Optionee
is then an employee of the Company).
6. MANNER OF EXERCISE AND PAYMENT.
6.1 Subject to the terms and conditions of this Agreement and
the Plan, the Option may be exercised by delivery of written notice to the
Company, at its principal executive office. Such notice shall state that the
Optionee is electing to exercise the Option and the number of shares of Stock in
respect of which the Option is being exercised and shall be signed by the person
or persons exercising the Option. If requested by the Committee, such person or
persons shall (i) deliver this Agreement to the Secretary of the Company who
shall endorse thereon a notation of such exercise and (ii) provide satisfactory
proof as to the right of such person or persons to exercise the Option.
6.2 The notice of exercise described in Section 6.1 shall be
accompanied by the full purchase price for the shares of Stock in respect of
which the Option is being exercised and by the Withholding Taxes, in cash, by
check or, in the discretion of the Committee, by transferring shares of Stock to
the Company held by the Optionee for more than six months and
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having a Fair Market Value on the day preceding the day of exercise equal to the
cash amount for which such shares of Stock are substituted. Notwithstanding the
preceding sentence, the parties agree that, to the extent permitted by law, and
to the extent it would not, in the Company's judgment, result in any adverse
legal, financial or tax implications for the Company, it is their intention that
Optionee be able to effect a simultaneous exercise of this Option and sale of
shares of Stock issuable upon such exercise in the over-the-counter market or
any securities exchange on which the Stock is then listed, without Optionee
bearing any commission or brokerage expense (a "concurrent transaction"). To
this end, the Company and Optionee shall jointly agree upon a securities broker
to be used in such transactions and further to adopt such additional procedures
as may be necessary or advisable to accomplish concurrent transactions. In any
concurrent transaction, the Company shall not be required to deliver a share
certificate upon exercise of this Option unless it receives concurrent payment
of the exercise price and Withholding Taxes. The Company shall bear all
commission and brokerage expense associated with concurrent transactions, which
shall be treated as an adjustment in the purchase price of shares subject to
this Option.
6.3 Upon receipt of notice of exercise and full payment for
the shares of Stock in respect of which the Option is being exercised and of the
Withholding Taxes, the Company shall, subject to Section 14 of the Plan,
promptly take such action as may be necessary to effect the transfer to the
Optionee of the number of shares of Stock as to which such exercise was
effective, including issuing and delivering such shares of Stock and entering
the Optionee's name as a stockholder of record on the books of the Company.
provided, that full payment of the exercise price and Withholding Taxes may be
made concurrently with such transfer and delivery in the case of a concurrent
transaction provided for in Section 6.2.
6.4 The Optionee shall not be deemed to be the holder of, or
to have any of the rights of a holder with respect to, any shares of Stock
subject to the Option until (i) the Option shall have been exercised pursuant to
the terms of this Agreement and the Optionee shall have paid the full purchase
price for the number of shares of Stock in respect of which the Option was
exercised, (ii) the Company shall have issued and delivered the shares of Stock
to the Optionee, and (iii) the Optionee's name shall have been entered as a
stockholder of record on the books of the Company, whereupon the Optionee shall
have full voting and other ownership rights with respect to such shares.
7. TERMINATION OF EMPLOYMENT.
If the Optionee's employment by the Company is terminated by
the Company or by the Optionee for any reason whatsoever, then the Optionee may
at any time within one year after such termination of employment (but in no
event after the expiration of the Exercise Term) exercise the Option to the
extent, but only to the extent, that the Option or portion thereof was
exercisable on the date of such termination of employment.
8. NONTRANSFERABILITY.
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The Option shall not be transferable other than by will or by the
laws of descent and distribution. During the lifetime of the Optionee, the
Option shall be exercisable only by the Optionee.
9. NO RIGHT TO CONTINUED EMPLOYMENT.
Nothing in this Agreement (as opposed to the Employee's employment
agreement, if any), or the Plan shall be interpreted or construed to confer upon
the Optionee any right with respect to continuance of employment by the Company,
nor shall this Agreement or the Plan interfere in any way with the right of the
Company to terminate the Optionee's employment at any time.
10. ADJUSTMENTS.
In the event of a Change in Capitalization, the Committee shall
conclusively determine the appropriate adjustments to the number and class of
shares of Stock subject to the Option and the purchase price for such shares of
Stock. The Committee's adjustment shall be made in accordance with the
provisions of Section 4.5 of the Plan and shall be effective and final, binding
and conclusive for all purposes of the Plan and this Agreement.
11. CERTAIN EVENTS.
Subject to Section 5 hereof, upon the effective date of (i) the
liquidation or dissolution of the Company or (ii) a merger or consolidation of
the Company (a "Transaction"), the Option shall continue in effect in accordance
with its terms and the Optionee shall be entitled to receive in respect of all
shares of Stock subject to the Option, upon exercise of the Option, the same
number and kind of stock, securities, cash, property or other consideration that
each holder of shares of Stock was entitled to receive in the Transaction.
12. WITHHOLDING OF TAXES.
At such times as an Optionee recognizes taxable income in connection
with the receipt of shares of Stock, securities, cash or property hereunder (a
"Taxable Event"), the Optionee shall pay to the Company an amount equal to the
federal, state and local income taxes and other amounts as may be required by
law to be withheld by the Company in connection with the Taxable Event (the
"Withholding Taxes") prior to the issuance, or release from escrow, of such
shares of Stock or securities or the payment of such cash or such property. The
Company shall have the right to deduct from any payment of cash to an Optionee
or Grantee an amount equal to the Withholding Taxes in satisfaction of the
obligation to pay Withholding Taxes. In satisfaction of the obligation to pay
Withholding Taxes to the Company, the Optionee may make a written election (the
"Tax Election"), which may be accepted or rejected in the discretion of the
Committee, to have withheld a portion of the shares then issuable to him having
an aggregate Fair Market Value, on the date preceding the date of such issuance,
equal to the Withholding Taxes.
13. OPTIONEE BOUND BY THE PLAN.
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The Optionee hereby acknowledges receipt of a copy of the Plan as
in effect on the date hereof and agrees to be bound by all the terms and
provisions of the Plan.
14. MODIFICATION OF AGREEMENT.
This Agreement may be modified, amended, suspended or terminated,
and any terms or conditions may be waived, but only by a written instrument
executed by the parties hereto.
15. SEVERABILITY.
Should any provision of this Agreement be held by a court of
competent jurisdiction to be unenforceable or invalid for any reason, the
remaining provisions of this Agreement shall not be affected by such holding and
shall continue in full force in accordance with their terms.
16. GOVERNING LAW.
The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of New York without giving
effect to the conflicts of laws principles thereof.
17. SUCCESSORS IN INTEREST.
This Agreement shall inure to the benefit of and be binding upon
any successor to the Company. This Agreement shall inure to the benefit of the
Optionee's legal representatives. All obligations imposed upon the Optionee and
all rights granted to the Company under this Agreement shall be final, binding
and conclusive upon the Optionee's heirs, executors, administrators and
successors.
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18. RESOLUTION OF DISPUTES.
Any dispute or disagreement which may arise under, or as a result
of, or in any way relate to, the interpretation, construction or application of
this Agreement shall be determined by binding arbitration. The parties may agree
to submit the matter to a single arbitrator or to several arbitrators, may
require that arbitrators possess special qualifications or expertise or may
agree to submit a matter to a mutually acceptable firm of experts for decision.
In the event the parties shall fail to thus agree upon terms of arbitration
within twenty (20) days from the first written demand for arbitration, then such
disputed matter shall be settled by arbitration under the Rules of Employment
Arbitration of the American Arbitration Association, by three arbitrators
appointed in accordance with such Rules. Such arbitration shall be held in
Miami, Florida. Once a matter has been submitted to arbitration pursuant to this
Section 18, the decision of the arbitrators reached and promulgated as a result
thereof shall be final and binding upon all parties. The cost of arbitration
shall be shared equally by the parties and each party shall pay the expenses of
his/its attorneys, except that the arbitrators shall be entitled to award the
costs of arbitration, attorneys and accountants' fees, as well as costs, to the
party that they determine to be the prevailing party in any such arbitration.
19. COUNTERPARTS.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
(SIGNATURE PAGE FOLLOWS)
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TELEMUNDO GROUP, INC.
By
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Name:
Title:
OPTIONEE
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