EXHIBIT 99.01
AMENDED AND RESTATED
SAVOY PICTURES ENTERTAINMENT, INC.
STOCK OPTION PLAN
ARTICLE I
DEFINITIONS
The terms used in this Stock Option Plan (the
"Plan"), which provides for the issuance of non-qualified stock
options ("Options"), shall, unless the context shall require
otherwise, have the following meanings:
A. "Adjusted Fair Market Value" shall mean, in the
event of a Change in Control, the greater of (i) the highest
price per share of Common Stock paid to holders of the Common
Stock in any transaction (or series of transactions) constitut-
ing or resulting in a Change of Control or (ii) the highest
Fair Market Value of a share of Common Stock during the ninety
(90) day period ending on the date of a Change in Control.
B. "Agreement" shall mean the written agreement
between the Company and a Recipient evidencing the grant of an
Option and setting forth the terms and conditions thereof.
C. A "Change of Control" shall occur, for purposes
of this Plan, at such time as any person or group, other than
stockholders of the Company specified in Annex I hereto (the
"Stockholders") and any other entities that become stockholders
before December 31, 1992 and their Permitted Transferees (as
defined in the Stockholders Agreement), acquire beneficially at
least 50% of the common stock of the Company, unless such event
occurs as a result of sales to stock in one or more IPOs.
D. "Common Stock" shall refer to the Company's
common stock.
E. The "Company" is Savoy Pictures Entertainment,
Inc., a New York corporation, and any successors in interest by
merger, operation of law, assignment, purchase or otherwise or
all or substantially all of the property, assets and business
of the Company.
F. The "Compensation Committee" shall mean the
Compensation Committee designated by the Board of Directors of
the Company.
G. An "Executive" shall include an elected or ap-
pointed executive of the Company in the position of "Vice
President" or a position of greater authority, and shall also
include any other employee of or consultant to the Company of
any of its subsidiaries designated for participation by either
(a) the unanimous written consent, dated March 2, 1992, of the
Company's Board of Directors or (b) by the Compensation Commit-
tee at any time.
H. "Fair Market Value" of the Company's Common
Stock shall mean the value established by the Board of Direc-
tors is good faith, after consultation with the Company's in-
vestment bankers, which shall not be less than book value as
set forth in the then most current financial statements of the
Company; provided, however, that, if the Common Stock is pub-
licly traded in the over-the-counter market or on a recognized
exchange, Fair Market Value shall be the average closing price
of the Shares for the 20 trading days immediately preceding the
event which required the determination of Fair Market Value.
I. "IPO" shall mean the completion of one or more
transactions, after giving effect to which, more than an ag-
gregate of 20% of the then outstanding shares of the Company
will have been sold to the public pursuant to a registration
statement declared effective by the Securities Exchange Commis-
sion under the Securities Act of 1933, as amended.
J. A "Recipient" is an Executive whom the Board of
Directors or Compensation Committee has designated to receive
an Option pursuant to the terms of the Plan.
K. The "Stockholder Agreement" shall mean the
Stockholders Agreement, dated as of March 2, 1992, between the
Company and the Stockholders, as amended from time to time.
L. "Termination for Cause" shall mean termination
for (a) conviction of any crime which constitutes a felony in
the jurisdiction involved, (b) gross negligence or willful mal-
feasance in performing the Recipient's obligations to the Com-
pany or in following the instructions of the Company's Board of
Directors, provided that the Company has given the Recipient
written notice setting forth with specificity the nature of the
Recipient's alleged gross negligence or malfeasance or (c)
cause pursuant to the terms of any written employment agreement
with the Company (or any of its subsidiaries) to which the Re-
cipient is a party.
ARTICLE II
PURPOSE AND SCOPE
A. Purpose - The Plan is being adopted by the Com-
pany for the purpose of establishing incentives designed to
attract and retain personnel with outstanding ability and expe-
rience to the Company, and to encourage the efforts and perfor-
mance of the Company's Executives by increasing their propri-
etary interest in the Company.
B. Eligibility - Executives shall be eligible to
receive Options under the Plan. The Compensation Committee, in
its sole discretion (or the Board of Directors in the case of
grants made on March 2, 1992) shall determine which Executives
shall become Recipients, the number of Options which shall be
granted to each Recipient, the date of the grant and the terms
of exercise of each Option.
ARTICLE III
ADMINISTRATION
A. Administration - The Plan shall be administered
by the Compensation Committee, which shall consist of members
designated by the Board of Directors of the Company. Without
limiting the generality of the foregoing, the Compensation Com-
mittee shall have authority, in its sole discretion (and its
determinations shall be final and binding on the Company and
Recipients of Options): to interpret conclusively the provi-
sions of the Plan and decide questions of fact arising in its
application; to adopt, amend and revoke rules and regulations
relating to the Plan; to determine the Executives to whom Op-
tions shall be granted, the number of such Options, their date
of grant and their exercise price; and to make any other deter-
mination necessary or desirable in the administration of the
Plan, except for those determinations reserved to the Board of
Directors of the Company; provided, however, that, with respect
to decisions by the Board of Directors or the Compensation Com-
mittee with respect to grants of Options to the Chief Executive
Officer or the Chief Operating Officer, the Chief Executive
Officer and the Chief Operation Officer shall not vote and the
action of the Compensation Committee with respect to them shall
be submitted to the Board of Directors for ratification.
B. Committee Action - A majority of the Compensa-
tion Committee shall constitute a quorum, and a majority of a
quorum may authorize any action.
C. Expenses - All costs of administering the Plan
shall be borne by the Company.
ARTICLE IV
SHARES SUBJECT TO PLAN
A. Maximum Shares - The maximum number of shares of
Common Stock which may be subject to Options under the Plan
shall be 1,000,000, subject to adjustment as provided in Sec-
tion 4.2 below. Either treasury stock or shares which have
been authorized but not yet issued (or a combination of both)
may be used to satisfy the Company's obligations under the
Plan. If an Option is cancelled or expires for any reason (in-
cluding forfeitures) prior to being exercised by its Recipient,
all shares subject to such Option shall become available for
future Options.
B. Adjustments - In the event of a stock split,
stock dividend, merger, combination, reorganization, recapital-
ization, reclassification, consolidation, spin-off, split-up or
substantially similar event affecting the number of shares of
Common Stock outstanding, or the issuance to all holders of
Common Stock of warrants or rights to buy Common Stock, the
maximum number of shares which may be subject to Options shall
be appropriately adjusted by the Compensation Committee.
ARTICLE V
TERMS AND CONDITIONS OF OPTIONS
Each Option shall be evidenced by an agreement (the
"Agreement") between the Company and the Recipient evidencing
the grant of an Option as herein provided. Each Agreement
shall conform to the following terms and conditions:
A. Option Price - The purchase price per share un-
der each Option granted by the Compensation Committee shall be
set by the Compensation Committee on the date of grant, and
shall not be less than the Fair Market Value of the Company's
Common Stock on that date; provided, however, that the Compen-
sation Committee with respect to options granted on or prior to
March 2, 1993 may provide that the purchase price per share
shall be $12.
B. Duration of Option - The Compensation Committee
shall determine the duration of each Option which it grants,
and each Agreement shall specify the maximum period during
which the Option to which it relates may be exercised. No Op-
tion shall be exercisable more than ten years after the date it
is granted, nor shall any Options be granted under the Plan
after March 2, 2002.
C. Vesting - Each Option shall vest (become exer-
cisable) in accordance with a determination by the Compensation
Committee.
D. Exercise of Option - Subject to Article VI be-
low, a Recipient who is vested with respect to all or part of
an Option may exercise all or a part of such vested portion of
delivering to the Company, at its principal executive office,
written notice specifying the number of shares with respect to
which the Option is being exercised, together with payment in
full of the purchase price of the shares. Such payment shall
be in cash or check or such other property (including shares of
Common Stock) as may be acceptable to the Compensation Commit-
tee. The Compensation Committee shall prescribe the method of
delivery of the notice. Vested Options may be exercised in any
order of grant that the Recipients (or his personal representa-
tive, if applicable) elects.
E. Rights After Issue - Upon the issuance of stock
certificates evidencing shares purchased under an Option, the
Recipient shall have all of the rights of a stockholder of the
Company with respect to the shares of Common Stock represented
by the certificate, including the right to vote the shares and
to receive all dividends and other distributions with respect
thereto. Prior to such issuance, the Recipient shall not be
entitled to any rights of a stockholder (including the right to
vote or receive dividends or distributions). Upon the exercise
of an Option, the Recipient shall become subject to the duties
and obligations, and entitled to the rights and benefits, of
the Stockholders Agreement, and the shares purchased under an
Option shall be subject to the transfer restrictions and voting
agreement contained in the Stockholders Agreement.
F. Non-Qualification - An Option granted pursuant
to the Plan shall not qualify as an "Incentive Stock Option"
under Section 422 of the Internal Revenue Code.
G. Non-Transferability - An Option granted pursuant
to the Plan may not be transferred in any manner otherwise than
by will or by the laws of descent and distribution and may be
exercised during the lifetime of the Recipient only by the Re-
cipient or by his guardian or legal representative. The terms
of any such Option shall be binding upon the executors, admin-
istrators, heirs and successors of the Recipient.
H. Effect of Change in Control - Notwithstanding
anything contained in the Plan or an Agreement to the contrary,
in the event of a Change in Control, (i) all Options outstand-
ing on the date of such Change in Control shall become im-
mediately and fully exercisable and (ii) a Recipient will be
permitted to surrender for cancellation, within sixty (60) days
after such Change in Control, any Option or portion of an Op-
tion to the extent not yet exercised and the Recipient will be
entitled to receive a cash payment in an amount equal to the
excess, if any, of (x) the greater of (1) the Fair Market
Value, on the date preceding the date of surrender, of the Com-
mon Stock subject to the Option or portion thereof surrendered
or (2) the Adjusted Fair Market Value of the Common Stock sub-
ject to the Options or portion thereof surrendered over (y) the
aggregate purchase price for such Common Stock under the Option
or portion thereof surrendered; provided, however, that in the
case of an Option granted within six (6) months prior to the
Change in Control to any Recipient who may be subject to li-
ability under Section 16(b) of the Securities Exchange Act of
19343, as amended (the "Exchange Act"), such Recipient shall be
entitled to surrender for cancellation his or her Option during
the sixty (60) day period commencing upon the expiration of six
(6) months from the date of grant of any such Option.
ARTICLE VI
TERMINATION OF EMPLOYMENT
An Option may be exercised by a Recipient whose em-
ployment by the Company (or a subsidiary of the Company) has
terminated only in accordance with the following rules:
1. In the event of the Recipient's Termination
for Cause, he shall forfeit all vested and non-vested
Options which have not been exercised at the date of
termination.
2. If the Recipient's employment is terminated
by reason of his death, permanent disability or re-
tirement, then he or his personal representative may
exercise any vested Option at any time before the
earlier of the third anniversary of his termination
of employment or the stated expiration date of such
Option.
3. If the Recipient's employment terminates
for any reason other than cause, death, disability or
retirement, he may exercise any vested Option at any
time before the earlier of the date six months after
such termination or the stated expiration date of
such Option.
4. If the Recipient dies after his employment
has terminated (whether by reason of disability or
otherwise) but before the period in which he may ex-
ercise an Option has expired, then his personal rep-
resentative may exercise any vested Option only dur-
ing the period that the Recipient, if alive, may have
exercised the Option.
ARTICLE VII
ADJUSTMENTS
1. Appropriate adjustments shall be made by the
Compensation Committee to the number of shares covered by an
Option, and to the purchase price per share, in the event of a
change in the number of the Company's shares of Common Stock
outstanding caused by a stock split, reverse stock split, stock
dividend, merger, combination, reorganization, recapitaliza-
tion, reclassification, consolidation, spin-off, split-up or
substantially similar event, or the issuance to all holders of
Common Stock of warrants or rights to buy Common Stock.
2. In the event of any conversion of Common Stock
generally into securities of another corporation, or the con-
solidation of the Company with, or the merger of the Company
with or into another corporation, or the sale of all or sub-
stantially all of the assets of the Company to another corpora-
tion, such Options not theretofore exercised prior to such
transaction shall thereafter, upon exercise, represent the
right to receive upon payment of the Option price in effect
immediately prior to such transaction, the kind and amount of
shares, security or property (including cash) which the holder
of the Option would have been entitled to receive following
consummation of such transaction had the Option been exercised
immediately prior to such transaction (subject to subsequent
adjustments as provided in paragraph (a) of this Article VII
upon the occurrence of the events herein specified).
ARTICLE VII
TERMINATION AND AMENDMENT
A. Termination or Amendment - The Board of Direc-
tors of the Company may terminate or amend the Plan at any
time, except that an Option then outstanding shall not be af-
fected thereby without the written consent and acquiescence of
the Recipient holding such Option.
B. Stockholder Approval - The Board may make such
amendments to the Plan as it shall deem advisable except that
the approval of a majority of the stockholders of the Company,
present or represented at a meeting duly held in accordance
with the laws of the State of New York, shall be required for
any amendment which would:
1. materially modify the requirements as to
eligibility for Option under the Plan;
2. materially increase the maximum number of
shares of Common Stock available under Paragraph 4.1
hereof; or
3. materially increase the benefits accruing
to Recipients under the Plan.
ARTICLE IX
MISCELLANEOUS
A. Limitation of Liability - As illustrative of the
limitations of the Company, but not intended to be exhaustive
thereof, nothing in the Plan shall be construed to:
1. give any person any right to be granted an
Option other than at the sole discretion of the Com-
pensation Committee;
2. give any person any rights whatsoever with
respect to shares of Common Stock except as specifi-
cally provided in the Plan;
3. limit in any way the right of the Company
to terminate the employment of any person at any
time; or
4. be evidence of any agreement or understand-
ing, expressed or implied, that the Company will em-
ploy any person in any particular position at any
particular rate of compensation or for any particular
period of time.
B. Non-Exclusivity of Plan - Nothing contained in
the Plan is intended to amend, modify or rescind any previously
approved compensation plans or programs entered into by the
Company. The Plan shall be construed to be in addition to any
and all such plans or programs. The adoption of the Plan shall
not be construed as creating any limitations on the power or
authority of the Board of Directors of the Company to adopt
such other additional incentive or other compensation arrange-
ments as the Board of Directors may deem necessary or desir-
able.
C. Withholding of Taxes - The Company shall have
the right to deduct from any distribution of cash to any Re-
cipient an amount equal to the federal, state and local income
taxes and other amounts as may be required by law to be with-
held (the "Withholding Taxes") with respect to any Option. If
a Recipient is entitled to receive Common Stock upon exercise
of an Option, the Recipient shall pay the Withholding Taxes to
the Company prior to the issuance, or release from escrow, of
such Common Stock. In satisfaction of the Withholding Taxes to
the Company, the Recipient may make a written election (the
"Tax Election"), which may be accepted or rejected in the dis-
cretion of the Compensation Committee, to have withheld a por-
tion of the Common Stock issuable to him or her upon exercise
of the Option having an aggregate Fair Market Value, on the
date preceding the date of exercise, equal to the Withholding
Taxes, providing that in respect of a Recipient who may be sub-
ject to liability under Section 16(b) of the Exchange Act
either (i) (A) the Recipient makes the Tax Election at least
six (6) months after the date the Option was granted, (B) the
Option is exercised during the ten-day period beginning on the
third business day and ending on the twelfth business day fol-
lowing the release for publication of the Company's quarterly
or annual statements of earnings (a "Window Period") and (C)
the Tax Election is made during the Window Period in which the
Option is exercised or prior to such Window Period and subse-
quent to the immediately preceding Window Period or (ii) (A)
the Tax Election is made at least six months prior to the date
the Option is exercised and (B) the Tax Election is irrevocable
with respect to the exercise of all Options which are exercised
prior to the expiration of six months following an election to
revoke the Tax Election. Notwithstanding the foregoing, the
Compensation Committee may, by the adoption of rules or other-
wise, (i) modify the provisions in the preceding sentence or
impose such other restrictions or limitations on Tax Elections
as may be necessary to ensure that the Tax Elections will be
exempt transactions under Section 16(b) of the Exchange Act,
and (ii) permit Tax Elections to be made at such other times
and subject to such other conditions as the Compensation Com-
mittee determines will constitute exempt transactions under
Section 16(b) of the Exchange Act.
D. Interpretation of the Program - 1. The headings
of Articles and Sections in the Plan are for convenience only,
and are not meant to modify the meaning of the text of each
such Article and Section.
2. As used herein, pronouns in the masculine gender
shall also include the feminine and the singular form of words
may include the plural, unless the context clearly requires the
contrary.
E. Effective Date - The Plan shall be effective as
of March 2, 1992.
ANNEX I
STOCKHOLDERS
1. GKH Partners, L.P.
2. Allen & Company Incorporated
3. Allen Value Limited
4. Allen Value Partners, L.P.
5. American Home Assurance Company
6. Mitsui & Co., Ltd.
7. Mitsui & Co. (USA), Inc.
8. Toho-Towa Co., Ltd.
9. Valdi Corporation N.V.
10. Weinberg Fund
11. Victor A. Kaufman
and Loretta Kaufman
12. Lewis J. Korman
and Sharon Korman
13. Frank Price
14. Chargeurs S.A.
15. Pricel S.A.
16. Allied Filmmakers N.V.
17. HKW Voting Trust
SAVOY PICTURES ENTERTAINMENT, INC.
FORM OF
STOCK OPTION AGREEMENT
THIS AGREEMENT, made as of __________________ (the
"Grant Date") between Savoy Pictures Entertainment, Inc., a
Delaware corporation (the "Company"), and _______________ (the
"Optionee").
WHEREAS, the Company has adopted the Savoy Pictures
Entertainment, Inc. Stock Option Plan in order to provide ad-
ditional incentive to certain officers and employees of, and
consultants to, the Company and its subsidiaries; and
WHEREAS, the Company has determined to grant to op-
tion 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, to the extent
the Option becomes vested and exercisable, all or any part of
an aggregate of _____ whole shares of common stock, par value
$.01 per share, of the Company ("Shares") 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.
2. Purchase Price.
The price at which the Optionee shall be entitled to
purchase Shares upon the exercise of the Option shall be $_____
per Share.
3. Duration of Option.
The Option shall be exercisable to the extent and in
the manner provided herein for a period of ten (10) years from
the Grant Date (the "Exercise Term"); provided, however, that
the Option may be earlier terminated as provided in Section 6
hereof.
4. Vesting and Exercisability of Option.
The Option shall vest and become exercisable with
respect to 33-1/3% of the Shares on the first anniversary of
the Grant Date, and an additional 33-1/3% of the Option shall
vest on each of the second and third anniversaries of the Grant
Date if and only if the Optionee has remained employed (as an
employee or consultant) by the Company until each of such
dates. The entire Option shall vest immediately if (i) the
Optionee dies or becomes permanently disabled while employed by
the Company, (ii) the Optionee is terminated without Cause (as
hereinafter defined), (iii) there occurs a Change of Control
(as hereinafter defined) of the Company or (iv) the Compensa-
tion Committee of the Company so decides. The Option shall
terminate to the extent it is unused.
5. Manner of Exercise and Payment.
5.1. Subject to the terms and conditions of
this Agreement, the Option may be exercised by delivery of
written notice to the Company, at its principal executive of-
fice. Such notice shall state that the Optionee is electing to
exercise the Option and the number of Shares in respect of
which the Option is being exercised.
5.2. The notice of exercise described in Sec-
tion 5.1 shall be accompanied by the full purchase price for
the Shares in respect of which the Option is being exercised,
in cash or check or such other property as may be acceptable to
the Board of Directors of the Company.
5.3. Upon receipt of notice of exercise and
full payment for the Shares in respect of which the Option is
being exercised, the Company shall take such action as may be
necessary to effect the transfer to the Optionee of the number
of Shares as to which such exercise was effective.
5.4. The Optionee shall not be deemed to be the
holder of, or to have any of the rights of a holder with re-
spect to any shares subject to the Option until (i) the Option
shall have been exercised pursuant to the terms of this Agree-
ment and the Optionee shall have paid the full purchase price
for the number of Shares in respect of which the Option was
exercised, (ii) the Company shall have issued and delivered the
Shares 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.
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6. Death, Disability, Retirement or Other Termina-
tion of Employment or Consultancy.
If the employment or consultancy of the Optionee is
terminated as a result of his death, disability or retirement,
the Option shall continue to be exercisable in whole or in part
at any time within three (3) years after the date of such ter-
mination of employment or consultancy, but in no event after
the expiration of the Exercise Term. If the employment or con-
sultancy of the Optionee terminates for any other reason, other
than for Cause, this Option shall continue to be exercisable in
whole or in part at any time within six (6) months after the
date of such other termination or employment or consultancy,
but in no event after the expiration of the Exercise Term. In
the event of termination for Cause, all vested Options shall
expire upon termination. In the event of the Optionee's death,
the Option shall be exercisable by the legatee or legatees un-
der his will, or by his personal representatives or distribu-
tees, and such person or persons shall be substituted for the
Optionee each time the Optionee is referred to herein.
7. Nontransferability.
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.
8. No Right to Continued Employment or Consultancy.
Nothing in this Agreement shall be interpreted or
construed to confer upon the Optionee any right with respect to
continuance of employment or consultancy by the Company, nor
shall this Agreement interfere in any way with the right of the
Company to terminate the Optionee's employment or consultancy
at any time.
9. Adjustments.
In the event of a Change in Capitalization (as here-
inafter defined), appropriate adjustments shall be made (as
determined in good faith by the Board of Directors of the Com-
pany) regarding the number and class of Shares or other stock
or securities subject to the Option and the purchase price for
such Shares or other stock or securities.
10. Termination Events.
In the event of (i) the liquidation or dissolution of
the Company or (ii) a merger or consolidation of the Company (a
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"Transaction"), the Option shall continue in effect in ac-
cordance with its terms for 90 days from the date of such
transaction and the Optionee shall only be entitled to receive
in respect of all Shares subject to the Option, upon exercise
of the Option within such ninety (90) day period, the same num-
ber and kind of stock, securities, cash, property or other con-
sideration that each holder of Shares was entitled to receive
in the Transaction.
11. Withholding of Taxes.
Upon exercise of the Option, the Optionee shall pay
the Withholding Taxes (as defined in Section 12) to the Company
in cash or check prior to the issuance, or release from escrow,
of such Shares. In satisfaction of the Withholding Taxes, the
Optionee may make a written election (the "Tax Election"),
which may be accepted or rejected in the discretion of the Com-
pany, to have withheld a portion of the Shares issuable to him
or her upon exercise of the Option, having an aggregate Fair
Market Value (as hereinafter defined) on the date preceding the
Tax Date (as defined in Section 12) equal to the Withholding
Taxes.
12. Definitions. For the purposes of this Agree-
ment:
(a) "Agreement" shall mean this written agree-
ment between the Company and the Optionee evidencing the grant
of an Option and setting forth the terms and conditions hereof.
(b) "Change in Capitalization" shall mean an
increase or reduction in the number of Shares by reason of re-
classification, recapitalization, merger, consolidation, reor-
ganization, spin-off, split-up, stock dividend, stock split or
reverse stock split or a substantially similar event, or the
issuance to all the holders of Shares of warrants or rights to
purchase Shares.
(c) "Cause" shall mean (a) conviction of any
crime which constitutes a felony in the jurisdiction involved
or (b) gross negligence or willful malfeasance in performing
the Optionee's obligations to the Company or in following the
instructions of the Company's Board of directors, provided that
the Company has given the Optionee written notice setting forth
with specificity the nature of the Optionee's alleged gross
negligence or willful malfeasance.
(d) "Change of Control" shall occur, for pur-
poses of this Agreement, at such time as any person or group,
other than the Stockholders of the Company specified in Annex I
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hereto and any other entities that become stockholders before
December 31, 1992 and their Permitted Transferees (as defined
in the Stockholders Agreement between the Company and the
Stockholders dated as of March 2, 1992, as amended) acquire
beneficially at least 50% of the common stock of the Company,
unless such event occurs as a result of sales or stock in one
or more IPOs (as defined in the Stockholders Agreement between
the Company and the Stockholders dated as of March 2, 1992, as
amended).
(e) "Disability" shall mean a physical or men-
tal infirmity which impairs the Optionee's ability to perform
substantially his or her duties for a period of one hundred
eighty (180) days in any calendar year.
(f) "Fair Market Value" shall mean the value
established by the Board of Directors in good faith, after con-
sultation with the Company's investment bankers.
(g) "Stockholders" shall mean the stockholders
of the Company who are parties to the Stockholders Agreement,
dated as of March 2, 1992, as amended.
(h) "Tax Date" shall mean the date that the
amount of Withholding Taxes are determined.
(i) "Withholding Taxes" shall mean an amount,
as determined by the Company, equal to the sum of federal,
state and local income taxes and any other taxes as the Company
may be required by law to withhold with respect to the exercise
of the Option.
13. 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.
14. Severability.
Should any provision of this Agreement be held by a
court of competent jurisdiction to be enforceable 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.
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15. Governing Law.
The validity, interpretation, construction and per-
formance 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.
16. 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 representa-
tives. All obligations imposed upon the Optionees and all
rights granted to the Company under this Agreement shall be
final, binding and conclusive upon the Optionee's heirs, execu-
tors, administrators and successors.
Savoy Pictures Entertainment, Inc.
Attest: By:
Lewis J. Korman, President
and Chief Operating Officer
Terri Napolitani
Assistant Secretary
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ANNEX I
STOCKHOLDERS
1. GKH Partners, L.P.
2. American Home Assurance Company
3. Allen & Company Incorporated
4. Allen Value Limited
5. Allen Value Partners, L.P.
6. Valdi Corporation N.V.
7. Mitsui & Co., Ltd.
8. Mitsui & Co. (USA), Inc.
9. Toho-Towa Co., Ltd.
10. Weinberg Fund
11. Weinberg Fund II
12. Victor A. Kaufman and Loretta Kaufman
13. Lewis J. Korman and Sharon Korman
14. Frank Price
15. Chargeurs S.A.
16. Pricel S.A.
17. Allied Filmakers B.V.
18. HKW Voting Trust
19. Cecchi Gori Europa B.V.
20. Rete Europa B.V.
21. High Speed Video B.V.
22. Home Box Office Division of Time Warner Enter-
tainment L.P.
EXHIBIT 5
[LETTERHEAD OF FRIED, FRANK, HARRIS, SHRIVER & JACOBSON]
830-8164
October 22, 1993 (FAX: 820-8587)
Savoy Pictures Entertainment, Inc.
Carnegie Hall Tower
152 West 57th Street
New York, New York 10019
Re: Savor Pictures Entertainment, Inc.
Registration Statement on Form S-8
- Stock Option Plan
Dear Sirs:
We are acting as counsel to Savoy Pictures Entertain-
ment Inc., a Delaware corporation (the "Company"), in connec-
tion with the possible issuance of up to 1,000,000 shares (the
"Shares") of common stock, par value $0.01 per share, of the
Company to officers, nonemployee directors, consultants and
employees of the Company and its subsidiaries upon the exercise
of options which may be granted to them pursuant to the Savoy
Pictures Entertainment Inc. Stock Option Plan (the "Plan").
We have examined the originals, or certified, con-
formed or reproduction copies, of all such records, agreements,
instruments and documents as we have deemed relevant or neces-
sary as the basis of the opinion hereinafter expressed. In all
such examinations, we have assumed the genuineness of all sig-
natures on original or certified copies and the conformity to
original or certified copies of all copies submitted to us as
conformed or reproduction copies. As to various questions of
fact relevant to such opinion, we have relied upon certificates
and statements of public officials, officers or representatives
of the Company and others.
Based upon the foregoing, and subject to the limita-
tions set forth herein, we are of the opinion that the issuance
of up to 1,000,000 Shares pursuant to the Plan has been duly
authorized and that such Shares, when issued and paid for (with
the consideration received by the Company being not less than
the par value thereof) in accordance with the Plan, will be
validly issued, fully paid and non-assessable.
Savoy Pictures
Entertainment Inc. -2- October 22, 1993
The opinion expressed herein is limited to the fed-
eral laws of the United States, the laws of the State of New
York and, to the extent required by the foregoing opinion, the
General Corporation Law of the State of Delaware.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement on Form S-8 relating to
the registration of the Shares. In giving this consent, we do
not hereby admit that we are in the category of persons whose
consent is required under Section 7 of the Securities Act of
1933.
Very truly yours,
FRIED, FRANK, HARRIS, SHRIVER & JACOBSON
By: /s/ David C. Golay
David C. Golay
EXHIBIT 24.1
CONSENT OF ERNST & YOUNG
We consent to the incorporation by reference in the Registra-
tion Statement (Form S-8) for the registration of 1,000,000
shares of common stock pertaining to the Stock Option Plan of
Savoy Pictures Entertainment, Inc. of our report dated February
5, 1993, except as to Note 9, as to which the date is March 16,
1993, with respect to the consolidated financial statements and
schedule of Savoy Pictures Entertainment, Inc. included in
Amendment No. 2 to the Company's Registration Statement on Form
S-1 (File No. 33-63192) for the year ended December 31, 1992,
filed with the Securities and Exchange Commission.
/s/ Ernst & Young
ERNST & YOUNG
New York, New York
October 21, 1993