EXHIBIT 99.04
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.
(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 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) 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 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 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