Document:

EX-4.2

 

EXHIBIT 4.2

AMENDED AND RESTATED

1999 LONG-TERM INCENTIVE PLAN

OF

ZAP.COM CORPORATION

     
1. Objective. The objective of
the 1999 Long-Term Incentive Plan (the “Plan”)
of ZAP.COM Corporation, a Nevada corporation
(“ZAP.COM” or the “Company”),
is to advance the interests of ZAP.COM and its stockholders by
providing a means to attract and retain officers and other key
employees to ZAP.COM and its Subsidiaries (hereinafter defined)
and to reward the performance of officers, other employees,
consultants and directors for fulfilling their responsibilities
for long-range achievements. These objectives are to be
accomplished by making awards under the Plan to Participants (as
hereinafter defined) that provide them with a proprietary
interest in the growth and performance of ZAP.COM and its
Subsidiaries.

     
2. Definitions. As used
herein, the terms set forth below shall have the meanings
ascribed thereto below:

		
	 	     
    “Affiliate”
    means an affiliate of ZAP.COM as defined in Rule 12b-2
    promulgated under Section 12 of the Exchange Act.
    
	 
	 	     
    “Award”
    means the grant of any form of stock option, stock appreciation
    right, stock award, cash award or other rights or interests,
    whether granted singly, in combination or in tandem, by ZAP.COM
    to a Participant under this Plan.
    
	 
	 	     
    “Award
    Agreement” means any written
    agreement, contract, notice or other instrument or document
    evidencing an Award.
    
	 
	 	     
    “Board”
    means the Board of Directors of ZAP.COM.
    
	 
	 	     
    “Change of
    Control” means the occurrence of
    any one of the following events:
    

		
	 	     
    (a) any person or entity other than Zapata
    or any affiliate of Zapata (including Malcolm Glazer or any
    entity controlled by him) is or becomes the beneficial owner (as
    defined in Section 13d-3 of the Securities Exchange Act of
    1934), directly or indirectly, of securities of the Company (not
    including in the securities beneficially owned by such person
    any securities acquired directly from the Company or any of its
    affiliates (as defined in SEC Rule 12b-2)) representing
    thirty-five percent (35%) or more of the combined voting power
    of the Company’s then outstanding voting securities;
    
	 
	 	     
    (b) the following individuals cease for any
    reason to constitute a majority of the number of directors then
    serving: individuals who, on the effective date of this Plan
    (the “Effective Date”), constitute the
    Company’s Board of Directors (the “Board”)
    and any new Director (other than a director whose initial
    assumption of office is in connection with an actual or
    threatened election contest, including, but not limited to, a
    consent solicitation, relating to the election of directors of
    the Company) whose appointment or election by the Board or
    nomination for election by the Company’s stockholders was
    approved or recommended by a vote of at least two-thirds ( 2/3)
    of the Directors then still in office who either were directors
    on the Effective Date or whose appointment, election or
    nomination for election was previously so approved or
    recommended;
    
	 
	 	     
    (c) there is consummated a merger or
    consolidation of the Company or any direct or indirect
    subsidiary of the Company with any other corporation, other than
    (i) a merger or consolidation which would result in the
    voting securities of the Company outstanding immediately prior
    thereto continuing to represent (either by remaining outstanding
    or by being converted into voting securities of the surviving or
    parent entity) more than fifty percent (50%) of the combined
    voting power of the voting securities of the Company or such
    surviving or parent entity outstanding immediately after
    

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    such merger or consolidation or (ii) a
    merger or consolidation effected to implement a recapitalization
    of the Company (or similar transaction) in which no person,
    directly or indirectly, acquired thirty-five percent (35%) or
    more of the combined voting power of the Company’s then
    outstanding securities (not including in the securities
    beneficially owned by such person any securities acquired
    directly from the Company or its affiliates); or
    
	 
	 	     
    (d) the stockholders of the Company approve
    a plan of complete liquidation of the Company or there is
    consummated an agreement for the sale or disposition by the
    Company of all or substantially all of the Company’s assets
    (or any transaction having a similar effect), other than a sale
    or disposition by the Company of all or substantially all of the
    Company’s assets to an entity, at least fifty percent (50%)
    of the combined voting power of the voting securities of which
    are owned by stockholders of the Company in substantially the
    same proportions as their ownership of the Company immediately
    prior to such sale.
    

		
	 	     
    “Code”
    means the Internal Revenue Code of 1986, as amended from time to
    time. References to any provision of the Code shall be deemed to
    include regulations thereunder and successor provisions and
    regulations thereto.
    
	 
	 	     
    “Committee”
    means the Board until a committee is appointed by the Board to
    administer the Plan, in which case, the composition of the
    committee shall at all times satisfy the provisions of
    Section 162(m) of the Code.
    
	 
	 	     
    “Common
    Stock” means the common stock,
    par value $.001 per share, of ZAP.COM.
    
	 
	 	     
    “Director”
    means an individual serving as a member of the Board.
    
	 
	 	     
    “Exchange
    Act” means the Securities
    Exchange Act of 1934, as amended from time to time. References
    to any provision of the Exchange Act shall be deemed to include
    rules thereunder and successor provisions and rules thereto.
    
	 
	 	     
    “Fair Market
    Value” means, with respect to
    Common Stock, Awards or other property, as of a particular date,
    (i) if the Common Stock is listed on a national securities
    exchange, the closing sales price per share of Common Stock on
    the consolidated transaction reporting system for the principal
    national securities exchange on which such shares are so listed
    on that date, or, if there shall have been no such sale so
    reported on that date, on the last preceding date on which such
    a sale was so reported, (ii) if the Common Stock is not so
    listed, but is quoted in the Nasdaq National Market System, the
    closing sales price per share of Common Stock on the Nasdaq
    National Market System on that date, or, if there shall have
    been no such sale so reported on that date, on the last
    preceding date on which such a sale was so reported,
    (iii) if the Common Stock is not so listed or quoted, the
    mean between the closing bid and asked price on that date, or,
    if there are no quotations available for such date, on the last
    preceding date on which such quotations shall be available, as
    reported by Nasdaq, or, if not reported by Nasdaq, by the
    National Quotation Bureau, Inc., and (iv) if such date is
    on a date prior to the date on which shares of Common Stock are
    distributed by Zapata to its stockholders pursuant to a
    registration statement filed with and declared effective by the
    Securities and Exchange Commission, the price determined by the
    Board in good faith to be the fair market value.
    
	 
	 	     
    “Incentive Stock
    Option” or “ISO” means
    an option that is intended to be and is designated as an
    “incentive stock option” within the meaning of
    Section 422 of the Code, or any successor provision.
    
	 
	 	     
    “Initial Public
    Offering” means the consummation
    of the distribution of shares of Common Stock made by Zapata to
    the holders of common stock of Zapata, as more fully described
    in the preliminary prospectus contained within the Amendment
    No. 3 to the Registration Statement, filed by ZAP.COM with
    the Securities and Exchange Commission on or about
    September 29, 1999, as such Registration Statement may
    thereafter be amended from time to time.
    
	 
	 	     
    “Participant”
    means any eligible person described in Section 3 of the
    Plan to whom an Award has been made under this Plan and his or
    her successors, heirs, executors and administrators, as the case
    may be.
    

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    “Pricing
    Date” means the date on which an
    Award consisting of an option or stock appreciation right is
    granted, except that the Committee may provide that (i) the
    Pricing Date is the date on which the recipient is hired or
    promoted (or similar event), if the grant of the option or stock
    appreciation right occurs not more than 90 days after the
    date of such hiring, promotion or other event, and (ii) if
    an Award consisting of an option or stock appreciation right is
    granted in tandem with or in substitution for an outstanding
    option or stock appreciation right, the Pricing Date is the date
    of grant of such outstanding option or stock appreciation right.
    
	 
	 	     
    “Subsidiary”
    means any corporation of which ZAP.COM directly or indirectly
    owns shares representing more than 50% of the voting power of
    all classes or series of capital stock of such corporation which
    have the right to vote generally on matters submitted to a vote
    of the stockholders of such corporation.
    
	 
	 	     
    “Zapata”
    means Zapata Corporation, a Nevada corporation, which prior to
    the Effective Date owned all of the Company’s outstanding
    capital stock.
    

     
3. Eligibility. Executive
officers and other employees of ZAP.COM, its parent or any of
its Subsidiaries, including any officer or member of the Board
who is also such an employee, and persons who provide consulting
or other services to ZAP.COM deemed by the Board to be of
substantial value to ZAP.COM, and non-employee Directors are
eligible to be granted Awards under the Plan. In addition,
persons who have been offered employment by ZAP.COM or its
Subsidiaries, and persons employed by an entity that the Board
reasonably expects to become a Subsidiary of ZAP.COM, are
eligible to be granted an Award under the Plan.

     
4. Stock Subject to the Plan.

     
(a) The total amount of Common Stock that
may be subject to outstanding Awards shall not exceed three
million (3,000,000) shares of Common Stock. Notwithstanding the
foregoing, not more than an aggregate of 100,000 shares of
Common Stock shall be available for Awards for stock options
that qualify as Incentive Stock Options.

     
(b) If an Award valued by reference to
Common Stock may only be settled in cash, the number of shares
to which such Award relates shall be deemed to be Common Stock
subject to such Award for purposes of this Section 4. Any
shares of Common Stock delivered pursuant to an Award may
consist, in whole or in part, of authorized and unissued shares,
treasury shares or shares acquired in the market for a
Participant’s account.

     
(c) Except as provided in an Award
Agreement, in the event that the Committee shall determine that
any dividend or other distribution (whether in the form of cash,
stock or other property), recapitalization, Common Stock split,
reverse split, reorganization, merger, consolidation, spin-off,
combination, repurchase or share exchange, or other similar
corporate transaction or event, affects the Common Stock such
that an adjustment is appropriate in order to prevent dilution
or enlargement of the rights of holders of Awards under the
Plan, then the Committee shall make such equitable changes or
adjustments as it deems necessary or appropriate to any or all
of (i) the number and kind of shares of Common Stock or
other property (including cash) that may thereafter be issued in
connection with Awards, (ii) the number and kind of shares
of Common Stock or other property (including cash) issued or
issuable in respect of outstanding Awards, (iii) the
exercise price, grant price or purchase price relating to any
Award; provided that, with respect to Incentive Stock Options,
such adjustment shall be made in accordance with
Section 424(h) of the Code, (iv) any performance goals
and (v) the individual limitations applicable to Awards.

     
5. Administration. This Plan
shall be administered by the Committee, which shall have full
and exclusive power to interpret this Plan and to adopt such
rules, regulations and guidelines and taking such actions as
necessary for carrying out this Plan as it may deem necessary or
proper. Unless otherwise provided in an Award Agreement with
respect to a particular award, the Committee may, in its
discretion, provide for the extension of the exercisability of
an Award, accelerate the vesting or exercisability of an Award,
eliminate or make less restrictive any restrictions contained in
an Award, waive any restriction or other provision of this Plan
or an Award or otherwise amend or modify an Award in any manner
that is either (i) not adverse to the Participant holding
such Award or (ii) consented to by such Participant, (but
only to the extent such change

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does not cause the Plan to fail to meet the
requirements of Sections 409A(a)(2), 409A(a)(3) and
409A(a)(4) of the Code). The Committee may correct any defect or
supply any omission or reconcile any inconsistency in this Plan
or in any Award in the manner and to the extent the Committee
deems necessary or desirable to carry it into effect. References
in this Plan to “permitted by the Committee” and words
of similar import refer to authorization contained in the
original Award Agreement or an amendment thereto or to other
action by the Committee, whether of general or limited
applicability or in connection with a particular exercise, Award
payment or other event. Any decision of the Committee in the
interpretation and administration of this Plan shall lie within
its sole and absolute discretion and shall be final, conclusive
and binding on all parties concerned. The express grant of any
specific power to the Committee, and the taking of any action by
the Committee, shall not be construed as limiting any power or
authority of the Committee.

     
Each member of the Committee shall be entitled,
in good faith, to rely or act upon any report or other
information furnished to him by any officer or other employee of
ZAP.COM or any Subsidiary, ZAP.COM’s independent certified
public accountants or any executive compensation consultant,
legal counsel or other professional retained by ZAP.COM or the
Committee to assist in the administration of the Plan. No member
of the Committee nor officer or employee of ZAP.COM to whom it
has delegated authority in accordance with the provisions of
Section 6 of this Plan, shall be liable for anything done
or omitted to be done by him or her, by any member of the
Committee or by any officer of ZAP.COM in connection with the
performance of any duties under this Plan, except for his or her
own willful misconduct or as expressly provided by statute.
ZAP.COM shall indemnify (to the extent permitted under Nevada
law) and hold harmless each member of the Committee and each
other director or employee of ZAP.COM to whom any duty or power
relating to the administration or interpretation of the Plan has
been delegated against any cost or expense (including counsel
fees) or liability (including any amount paid in settlement of a
claim with the approval of the Committee) arising out of any
action, omission or determination relating to the Plan, unless,
in either case, such action, omission or determination was taken
or made by such member, director or employee without good faith
or the reasonable belief that it was in the best interests of
ZAP.COM.

     
6. Delegation of Authority.
The Committee may delegate to the Chief Executive Officer and to
other senior officers of ZAP.COM its duties under this Plan
pursuant to such conditions or limitations as the Committee may
establish, except that the Committee may not delegate to any
person the authority to grant Awards to, or take other action
with respect to, Participants who are subject to Section 16
of the Exchange Act.

     
7. Awards. The Committee shall
select persons to whom Awards may be granted, determine the type
or types of Awards to be made to each Participant under this
Plan, determine the number of Awards to be granted and the
number of shares of Common Stock to which an Award will relate
and determine all other terms, conditions, restrictions and
conditions, including achievement of specific business
objectives, increases in specified indices, attaining specified
growth rates and other comparable measurements of performance
goals, if any. Each Award made hereunder shall be embodied in an
Award Agreement, which shall contain such terms, conditions and
limitations as shall be determined by the Committee, in its sole
discretion and consistent with the provisions hereof, and shall
be signed by the Participant and by the Chief Executive Officer,
the President or any Vice President of ZAP.COM for and on behalf
of ZAP.COM. Award Agreements and the forms contained therein
need not be identical for each Participant. By accepting an
Award, a Participant thereby agrees that the Award shall be
subject to all of the terms and provisions of the Plan and the
applicable Award Agreement. Awards may consist of those listed
in this Section 7. Awards may be made in combination or in
tandem with, in replacement of, or as alternatives to, Awards
under this Plan or any other employee plan of ZAP.COM or any of
its Subsidiaries, including any incentive or similar plan of any
acquired entity, or reload options automatically granted to
offset specified exercises of options, but only if such Award,
in replacement of, or as alternatives to grants or rights under
this Plan (a) would not constitute an acceleration of
deferred compensation for purposes of Section 409A(a)(3) of
the Code, and (b) meets the requirements of
Sections 409A(a)(2), 409A(a)(3) and 409A(a)(4) of the Code.
The Committee shall determine the time or times at which an
option may be exercised, in whole or in part, the method by
which the exercise price may be paid or deemed to be paid, the
form of such payment, including, without limitation, cash,
Common Stock or other Awards or awards granted under other
ZAP.COM plans or other property

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(including notes or other contractual obligations
of Participants to make payment on a deferred basis, such as
through “cashless exercise” arrangements, to the
extent permitted by applicable law), and the methods by which
Common Stock will be delivered or be deemed to be delivered to
Participants. An Award may provide for the granting or issuance
of additional, replacement or alternative Awards upon the
occurrence of specified events, including the exercise of the
original Award, but only if such additional, replacement or
alternative Awards (a) would not constitute an acceleration
of deferred compensation for purposes of Section 409A(a)(3)
of the Code, and (b) meets the requirements of
Sections 409A(a)(2), 409A(a)(3) and 409A(a)(4) of the Code.
An Award may provide that to the extent that the acceleration of
vesting or any payment made to a Participant under this Plan in
the event of a Change of Control of ZAP.COM is subject to
federal income, excise, or other tax at a rate above the rate
ordinarily applicable to like payments paid in the ordinary
course of business (“Penalty Tax”), whether as
a result of the provisions of Sections 28OG and 4999 of the
Code, any similar or analogous provisions of any statute adopted
subsequent to the date hereof, or otherwise, then ZAP.COM shall
be obligated to pay such Participant an additional amount of
cash (the “Additional Amount”) such that the
net amount received by such Participant, after paying any
applicable Penalty Tax and any federal or state income tax on
such Additional Amount, shall be equal to the amount that such
Participant would have received if such Penalty Tax were not
applicable. Notwithstanding the foregoing, if an event that
constitutes a change in control does not constitute a
“change in control” under Section 409A of the
Code (or the regulations promulgated thereunder), no payments
with respect to the Award shall be made under this paragraph
until such payments would not constitute an impermissible
acceleration under Section 409A of the Code.

     
(a) Stock Option. An Award may
consist of an option to purchase a specified number of shares of
Common Stock at a specified exercise price that is not less than
the greater of (i) the Fair Market Value of the Common
Stock on the Pricing Date and (ii) the par value of the
Common Stock. The number of shares and exercise price shall be
specified by the Committee. A stock option may be in the form of
an ISO which, in addition to being subject to applicable terms,
conditions and limitations established by the Committee, shall
comply with the requirement that no ISO shall be granted with an
exercise price less than 100% (110% for an individual described
in Section 422(b)(6) of the Code) of the Fair Market Value
of a share of Common Stock on the date of the grant and granted
no more than ten (10) years after the effective date of the
Plan. Anything in the plan to the contrary notwithstanding, no
term of the Plan relating to ISOs shall be interpreted, amended
or altered, nor shall any discretion or authority granted under
the Plan be exercised, so as to qualify either the Plan or any
ISO under Section 422 of the Code unless so requested by
the affected Participant. Each option shall be clearly
identified in the applicable Award Agreement as either an ISO or
a non-qualified option.

     
(b) Stock Appreciation Right.
An Award may consist of a right to receive a payment, in cash or
Common Stock, equal to the excess of the Fair Market Value or
other specified valuation of a specified number of shares of
Common Stock on the date the stock appreciation right
(“SAR”) is exercised over a specified strike price
determined by the Committee that shall be set forth in the
applicable Award Agreement. The Committee shall determine the
time or times at which an SAR may be exercised in whole or in
part, the method of exercise, method of settlement, form of
consideration payable in settlement, method by which Common
Stock will be delivered or be deemed to be delivered to
Participants, whether or not the SAR will be in tandem with any
other Award and any other terms and conditions of any SAR.

     
(c) Stock Award. An Award may
consist of Common Stock or may be denominated in units of Common
Stock. All or part of any Award may be subject to restrictions
on transfer and other restrictions and conditions established by
the Committee and set forth in the Award Agreement, which may
include, but is not limited to, continuous service with ZAP.COM
and/or its Subsidiaries. Such Awards may be based on Fair Market
Value or other valuations determined by the Committee. The
certificates evidencing shares of Common Stock issued in
connection with an Award shall contain appropriate legends and
restrictions describing the terms and conditions applicable
thereto, ZAP.COM may retain physical possession of the
certificates and the Participant shall have delivered a stock
power to ZAP.COM, endorsed in blank, relating to the Common
Stock. Except to the extent restricted under the terms of the
Plan and any Award Agreement relating to the Award, a
Participant granted an Award shall have all of the rights of a
stockholder, including,

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without limitation, the right to vote Common
Stock issued as an Award or the right to receive dividends
thereon.

     
(d) Cash Award. An Award may
be denominated in cash with the amount of the eventual payment
subject to future service and such other restrictions and
conditions as may be established by the Committee, and set forth
in the Award Agreement, including, but not limited to,
continuous service with ZAP.COM and its Subsidiaries.

     
(e) Other Stock-Based Awards.
The Committee is authorized, subject to limitations under
applicable law, to grant such other Awards that may be
denominated or payable in, valued in whole or in part by
reference to, or otherwise based on, or related to, Common Stock
and factors that may influence the value of Common Stock, as
deemed by the Committee to be consistent with the purposes of
the Plan, including, without limitation, convertible or
exchangeable debt securities, other rights convertible or
exchangeable into Common Stock, purchase rights for Common
Stock, Awards with value and payment contingent upon performance
of ZAP.COM or any other factors designated by the Committee and
Awards valued by reference to the book value of Common Stock or
the value of securities of or the performance of specified
Subsidiaries (“Other Stock Based Awards”). The
Committee shall determine the terms and conditions of such
Awards. Stock issued pursuant to an Award in the nature of a
purchase right granted under this Section 7(e) shall be
purchased for such consideration, paid for at such times, by
such methods and in such forms, including, without limitation,
cash, Common Stock, other Awards or other property, as the
Committee shall determine.

     
(f) Loan Provisions. With
consent of the Committee, and subject at all times to, and only
to the extent, if any, permitted under and in accordance with,
laws and regulations and other binding obligations or provisions
applicable to ZAP.COM, ZAP.COM may make, guarantee or arrange
for a loan or loans to a Participant with respect to the
exercise of any option or other payment in connection with any
Award, including the payment by a Participant of any or all
federal, state or local income or other taxes due in connection
with any Award. Subject to such limitations, the Committee shall
have full authority to decide whether to make a loan or loans
hereunder and to determine the amount, terms and provisions of
any such loan or loans, including the interest rate to be
charged in respect of any such loan or loans, whether the loan
or loans are to be paid with or without recourse against the
borrower, the terms on which the loan is to be repaid and
conditions, if any, under which the loan or loans may be
forgiven.

     
(g) Performance-Based Awards.
The Committee may, in its discretion, designate any Award the
exercisability or settlement of which is subject to the
achievement of performance conditions as a performance-based
Award subject to this Section 7(g), in order to qualify
such Award as “qualified performance-based
compensation” within the meaning of Code
Section 162(m) and regulations thereunder. The performance
objectives for an Award subject to this Section 7(g) shall
consist of one or more business criteria, as specified by the
Committee, but subject to this Section 7(g). Performance
objectives shall be objective and shall otherwise meet the
requirements of Section 162(m)(4)(C) of the Code. The
levels of performance required with respect to such business
criteria may be expressed in absolute or relative levels.
Achievement of performance objectives with respect to such
Awards shall be measured over a period of not less than one
(1) year nor more than five (5) years, as the
Committee may specify. Performance objectives may differ for
such Awards to different Participants. The Committee shall
specify the weighting to be given to each performance objective
for purposes of determining the final amount payable with
respect to any such Award. The Committee may, in its discretion,
reduce the amount of a payout otherwise to be made in connection
with an Award subject to this Section 7(g), but may not
exercise discretion to increase such amount, and the Committee
may consider other performance criteria in exercising such
discretion. All determinations by the Committee as to the
achievement of performance objectives shall be in writing. The
Committee may not delegate any responsibility with respect to an
Award subject to this Section 7(g).

     
(h) Acceleration Upon a Change of
Control. Notwithstanding anything contained herein to
the contrary, all conditions and/or restrictions relating to the
continued performance of services and/or the achievement of
performance objectives with respect to the exercisability or
full enjoyment of an Award shall immediately lapse upon a Change
in Control, provided, however, that such lapse shall not occur
if (i) it is intended that the transaction constituting
such Change in Control be accounted for as a pooling of interests

35

 

under Accounting Principles Board Option
No. 16 (or any successor thereto), and operation of this
Section 7(h) would otherwise violate Paragraph 47(c)
thereof, or (ii) the Committee, in its discretion,
determines that such lapse shall not occur, provided, further,
that the Committee shall not have the discretion granted in
clause (ii) if it is intended that the transaction
constituting such Change in Control be accounted for as a
pooling of interests under Accounting Principles Board
No. 16 (or any successor thereto), and such discretion
would otherwise violate Paragraph 47(c) thereof.

     
8. Payment of Awards.

     
(a) General. Payment required
to be made by ZAP.COM pursuant to Awards may be made in the form
of cash or Common Stock or combinations thereof and may include
such restrictions as the Committee shall determine, including in
the case of Common Stock, restrictions on transfer and
forfeiture provisions.

     
(b) Deferral. The Committee
may permit selected Participants to elect to defer payments of
some or all types of Awards in accordance with procedures
established by the Committee. A Participant must elect by
written notice to the Company, which notice must be made before
the later of (i) the close of the tax year preceding the
year in which the Award is granted or (ii) 30 days of
first becoming eligible to participate in the Plan (or, if
earlier, the last day of the tax year in which the participant
first becomes eligible to participate in the Plan) and on or
prior to the date the Award is granted, to defer the receipt of
all or a portion of the payment of an Award; provided that the
Committee may impose such additional restrictions with respect
to the time at which a participant may elect to defer receipt of
Common Stock subject to the deferral election. Any election
after the period described above (“subsequent
election”) cannot be effective for at least twelve
(12) months after the date of such subsequent election.
Further, the payment date elected pursuant to the subsequent
election must not occur earlier than the date which is at least
five (5) years from the date that the original payment
would have been made. Finally, the subsequent election cannot be
made less than twelve (12) months prior to the date of the
first scheduled payment. Any deferred payment, whether elected
by the Participant or specified by the Award Agreement or by the
Committee, may be forfeited if and to the extent that the Award
Agreement so provides.

     
(c) Dividends and Interest.
Dividends or dividend equivalent rights may be extended to and
made part of any Award denominated in Common Stock or units of
Common Stock, subject to such terms, conditions and restrictions
as the Committee may establish. Dividend equivalent rights may
be awarded on a free-standing basis or in connection with
another Award. The Committee may provide that dividend
equivalent rights shall be paid or distributed when accrued or
shall be deemed to be reinvested in additional Common Stock,
Awards or other investment vehicles, and subject to such
restrictions on transferability and risks of forfeiture, as the
Committee may specify. The Committee may establish rules and
procedures for the crediting of interest on deferred cash
payments and dividend equivalents for deferred payment
denominated in Common Stock or units of Common Stock.

     
(d) Substitution of Awards. At
the discretion of the Committee, a Participant may be offered an
election to substitute an Award for another Award or Awards of
the same or different type.

     
9. Tax Withholding. ZAP.COM
shall have the right to deduct applicable taxes from any Award
payment and withhold, at the time of delivery or vesting of cash
or shares of Common Stock under this Plan, or from payroll or
other payments to the Participant, an appropriate amount of cash
or number of shares of Common Stock or a combination thereof for
payment of taxes required by law or to take such other action as
may be necessary in the opinion of the Committee to satisfy all
obligations for withholding of such taxes. The Committee may
also permit withholding to be satisfied by the transfer to
ZAP.COM of shares of Common Stock theretofore owned by the
holder of the Award with respect to which withholding is
required. If shares of Common Stock are used to satisfy tax
withholding, such shares shall be valued based on the Fair
Market Value when the tax withholding is required to be made.

     
10. Employment, Termination,
Etc.

     
(a) Nothing contained in the Plan or any
Award Agreement shall confer upon any Participant any right with
respect to the continuation of employment or engagement by
ZAP.COM or any of its Subsidiaries or interfere in any way with
the right of ZAP.COM or any of its Subsidiaries, subject to the
terms of any separate

36

 

agreement to the contrary, at any time to
terminate such employment or service or to increase or decrease
the compensation of the Participant.

     
(b) No person shall have any claim or right
to receive an Award hereunder or require the Committee to make
an Award at any time to any Participant. The Committee’s
grant of an Award to a Participant at any time shall neither
require the Committee to grant any other Award to such
Participant or other person at any time or preclude the
Committee from making subsequent grants to such Participant or
any other person.

     
(c) Upon the termination of employment or
engagement of a Participant, any unexercised, deferred or unpaid
Awards shall be treated as provided in the specific Award
Agreement evidencing the Award. In the event of such a
termination, the Committee may, in its discretion, provide for
the extension of the exercisability of an Award, accelerate the
vesting or exercisability of an Award, eliminate or make less
restrictive any restrictions contained in an Award, waive any
restriction or other provision of this Plan or an Award or
otherwise amend or modify the Award in any manner that is either
(i) not adverse to such Participant or (ii) consented
to by such Participant.

     
11. Amendment, Modification,
Suspension or Termination. The Board may amend, modify,
suspend, discontinue or terminate this Plan at any time for the
purpose of meeting or addressing any changes in legal
requirements or for any other purpose permitted by law except
that (a) no amendment or alteration that would impair the
rights of any Participant under any Award previously granted to
such Participant shall be made without such Participant’s
consent and (b) no amendment or alteration shall be
effective prior to approval by ZAP.COM’s stockholders if
and to the extent the Board determines that such approval is
appropriate for purposes of satisfying Section 162(m) or
422 of the Code or is otherwise required by law or applicable
stock exchange requirements. Awards may be granted under the
Plan prior to the receipt of such approval. The Board may also
modify, suspend, terminate, discontinue or limit the power and
authority of the Committee at any time. Except as required in
Section 11(b) hereunder, unless the Board determines
otherwise, no stockholder approval shall be required before any
action taken by the Board pursuant to this Section 11 is
effective. Nothing herein shall restrict the Committee’s
ability to exercise its discretionary authority pursuant to
Section 5 which discretion may be exercised without
amendment to the Plan.

     
12. Transfer and Assignment.

     
(a) Awards and other rights under the Plan
will not be transferable by a Participant except by will or the
laws of descent and distribution or to a Beneficiary in the
event of a Participant’s death. Awards shall not be
pledged, mortgaged, hypothecated or otherwise encumbered, or
otherwise subject to the claims of creditors, and, in the case
of ISOs and SARs in tandem therewith, shall be exercisable
during the lifetime of a Participant only by such Participant or
his guardian or legal representative; provided, however, that
such Awards and other rights (other than ISOs or SARs in tandem
therewith) may be transferred to one or more Beneficiaries
during the lifetime of the Participant to the extent and on such
terms as then may be permitted by the Committee.

     
(b) Upon the death of a Participant,
outstanding Awards granted to such Participant may be exercised
only by the executor or administrator of the Participant’s
estate or by a person who shall have acquired the right to such
exercise by will or by the laws of descent and distribution. No
transfer of an Award by will or the laws of descent and
distribution shall be effective to bind ZAP.COM unless the
Committee shall have been furnished with (i) written notice
thereof and with a copy of the will and/or such evidence as the
Committee may deem necessary to establish the validity of the
transfer and (ii) an agreement by the transferee to comply
with all of the terms and conditions of the Award that are or
would have been applicable to the Participant and to be bound by
the acknowledgements made by the Participant in connection with
the grant of the Award.

     
13. ZAP.COM’s Right to Engage in
Certain Transactions. The existence of this Plan or
outstanding Awards shall not affect in any manner the right or
power of ZAP.COM or its stockholders to make or authorize any or
all adjustments, recapitalizations, reorganizations or other
changes in the capital stock of ZAP.COM or its business or any
merger or consolidation of ZAP.COM, or any issue of bonds,
debentures, preferred or prior preference stock (whether or not
such issue is prior to, on a parity with or junior to the Common
Stock) or the dissolution or liquidation of ZAP.COM, or any sale
or transfer of all or any part of its

37

 

assets or business, or any other corporate act or
proceeding of any kind, whether or not of a character similar to
that of the acts or proceedings enumerated above.

     
14. Securities Laws.

     
(a) Notwithstanding anything herein to the
contrary, ZAP.COM shall not be obligated to cause to be issued
or delivered any certificates evidencing Common Stock pursuant
to the Plan unless and until ZAP.COM is advised by its counsel
that the issuance and delivery of such certificates is in
compliance with all applicable laws, regulations of governmental
authority and the requirements of any securities exchange on
which shares of Common Stock are traded. ZAP.COM, however, shall
be under no obligation to effect the registration pursuant to
the Securities Act of any interests in the Plan or any Stock to
be issued hereunder or to effect similar compliance under any
state laws. The Committee may require, as a condition of the
issuance and delivery of certificates evidencing shares of
Common Stock, that the Participant to whom such shares will be
issued make such agreements and representations, and that such
certificates bear such legends, as the Committee, in its sole
discretion, deems necessary or desirable.

     
(b) The transfer of any shares of Common
Stock hereunder shall be effective only at such time as counsel
to ZAP.COM shall have determined that the issuance and delivery
of such shares of Common Stock is in compliance with all
applicable laws, regulations of governmental authority and the
requirements of any securities exchange on which shares of
Common Stock are traded or quoted. The Committee may, in its
sole discretion, defer the effectiveness of any transfer of
Common Stock hereunder in order to allow the issuance of such
Common Stock to be made pursuant to registration or an exemption
from registration or other methods for compliance available
under federal or state securities laws. The Committee shall
inform the Participant in writing of its decision to defer the
effectiveness of a transfer. During the period of such deferral
in connection with the exercise of an Option, the Participant
may, by written notice, withdraw such exercise and obtain the
refund of any amount paid with respect thereto.

     
15. Unfunded Status of Awards,
Creation of Trusts. The Plan is intended to constitute
an “unfunded” plan for incentive and deferred
compensation. With respect to any payments not yet made to a
Participant pursuant to an Award, nothing contained in the Plan
or any Award shall give any such Participant any rights that are
greater than those of a general creditor of ZAP.COM; provided,
however, that the Committee may authorize the creation of trusts
or make other arrangements to meet ZAP.COM’s obligations
under the Plan to deliver cash, Common Stock, other Awards or
other property pursuant to any Award, which trusts or other
arrangements shall be consistent with the “unfunded”
status of the Plan unless the Committee otherwise determines
with the consent of each affected Participant.

     
16. Notification of Election Under
Section 83(b) of the Code. If any Participant
shall, in connection with the acquisition of Common Stock under
the Plan, make the election permitted under Section 83(b)
of the Code (i.e., an election to include in gross income
in the year of transfer the amounts specified in
Section 83(b)), such Participant shall notify ZAP.COM of
such election within ten (10) days of filing notice of the
election with the Internal Revenue Service, in addition to any
filing and a notification required pursuant to regulation issued
under the authority of Section 83(b) of the Code.

     
17. Notification Upon Disqualifying
Disposition Under Section 421(b) of the Code. Each
Participant shall notify ZAP.COM of any disposition of Common
Stock issued pursuant to the exercise of an ISO under the
circumstances described in Section 421(b) of the Code
(relating to certain disqualifying dispositions), within ten
(10) days of such disposition.

     
18. Participant Rights. No
Participant shall have any claim to be granted any award under
the Plan, and there is no obligation for uniformity of treatment
for Participants. Except as provided specifically herein, a
Participant or a transferee of an Award shall have no rights as
a stockholder with respect to any shares of Common Stock covered
by any Award until the date of the issuance of a certificate or
certificates to him or her for such shares of Common Stock.

     
19. Beneficiary. A Participant
may file with the Committee a written designation of a
Beneficiary on such form as may be prescribed by the Committee
and may, from time to time, amend or revoke such

38

 

designation. If no designated Beneficiary
survives the Participant, the executor or administrator of the
Participant’s estate shall be deemed to be the
grantee’s Beneficiary.

     
20. Interpretation. The Plan
is designed and intended to comply with Rule 16b-3 and, to
the extent applicable, shall constitute “qualified
performance based compensation” within the meaning of
Section 162(m) of the Code, and all provisions hereof shall
be construed in a manner to so comply. Accordingly, if any
provision of the Plan or any Award Agreement does not comply or
is inconsistent with the requirement of Code
Section 162(m), such provision shall be construed or deemed
amended to the extent necessary to conform to such requirements,
and no provision shall be deemed to confer upon the Committee or
any other person discretion to increase the amount of
compensation otherwise payable in connection with any Awards
upon attainment of the performance objectives.

     
21. Severability. If any
provision of the Plan is held to be invalid or unenforceable,
the other provisions of the Plan shall not be affected but shall
be applied as if the invalid or unenforceable provision had not
been included in the Plan.

     
22. Expenses and Receipts. The
expenses of the Plan shall be paid by ZAP.COM. Any proceeds
received by ZAP.COM in connection with any Award will be used
for general corporate purposes.

     
23. Failure to Comply. In
addition to the remedies of ZAP.COM elsewhere provided for
herein, failure by a Participant (or Beneficiary) to comply with
any of the terms and conditions of the Plan or the applicable
Award Agreement, unless such failure is remedied by such
Participant (or Beneficiary or other person) within ten
(10) days after notice of such failure by the Committee,
shall be grounds for the cancellation and forfeiture of such
Award, in whole or in part, as the Committee, in its absolute
discretion, may determine.

     
24. Non-Exclusivity of the
Plan. Neither the adoption of the Plan by the Board nor
its submission to ZAP.COM’s stockholders for approval shall
be construed as creating any limitations on the power of the
Board to adopt such other compensatory arrangements as it may
deem desirable, including, without limitation, the granting of
stock options otherwise than under the Plan, and such
arrangements may be either applicable generally or only in
specific cases.

     
25. No Fractional Shares. No
fractional shares of Common Stock shall be issued or delivered
pursuant to the Plan or any Award. The Committee shall determine
whether cash, other Awards or other property shall be issued or
paid in lieu of such fractional shares or whether such
fractional shares or any rights thereto shall be forfeited or
otherwise eliminated.

     
26. Claims Procedure.

     
(a) In the event the Company fails to make
any payments under the Plan as agreed, to obtain payment under
the Plan, the Participant must file a written claim with the
Company on such forms as shall be furnished to him by the
Company. If a claim for payment is denied by the Company, in
whole or in part, the Company shall provide adequate notice in
writing to the Participant within ninety (90) days after
receipt of the claim unless special circumstances require an
extension of time for processing the claim. If such an extension
of time for processing is required, written notice indicating
the special circumstances and the date by which a final decision
is expected to be rendered shall be furnished to the
Participant. In no event shall the period of extension exceed
one hundred eighty (180) days after receipt of the claim.
The notice of denial of the claim shall set forth (i) the
specific reason or reasons for the denial; (ii) specific
reference to pertinent provisions of the Agreement on which the
denial is based; (iii) a description of any additional
material or information necessary for the claimant to perfect
the claim and an explanation of why such material or information
is necessary; and (iv) a statement that any appeal of the
denial must be made by giving to the Company, within sixty
(60) days after receipt of the notice of the denial,
written notice of such appeal, such notice to include a full
description of the pertinent issues and basis of the claim. The
Participant may review pertinent documents and submit issues and
comments in writing to the Company. If the Participant fails to
appeal such action to the Company in writing within the
prescribed period of time, the Company’s adverse
determination shall be final, binding and conclusive.

39

 

     
(b) If the Participant appeals the denial of
a claim for payment within the appropriate time, the Participant
must submit the notice of appeal and all relevant materials to
the Committee. The Committee may hold a hearing or otherwise
ascertain such facts as it deems necessary and shall render a
decision which shall be binding upon both parties. The decision
of the Committee shall be made within sixty (60) days after
the receipt of the notice of appeal, unless special
circumstances require an extension of time for processing, in
which case a decision shall be rendered as soon as possible but
not later than one hundred twenty (120) days after receipt
of the request for review. If such an extension of time is
required, written notice of the extension shall be furnished to
the Participant prior to the commencement of the extension. The
decision of the Committee shall be in writing, shall include
specific reasons for the decision, written in a manner
calculated to be understood by the claimant, as well as specific
references to the provisions of the Plan which the decision is
based and shall be promptly furnished to the Participant.

     
27. Governing Law. This Plan
and all determinations made and actions taken pursuant hereto,
to the extent not otherwise governed by mandatory provisions of
the Code, the securities laws of the United States, or the
Employee Retirement Income Security Act of 1974, shall be
governed by and construed in accordance with the laws of the
State of the State of Nevada.

     
28. Effective Date of Plan.
This Plan shall be effective on the date of the Initial Public
Offering, provided the Plan has been approved by the
stockholders of ZAP.COM prior to the Initial Public Offering.
Unless earlier terminated by the Board, the right to grant
Awards under the Plan will terminate on the tenth (10th)
anniversary of the Effective Date. Awards outstanding at Plan
termination will remain in effect according to their terms and
the provisions of the Plan.

40EX-10.R

 

    EXHIBIT 10(r)

 

    Summary
    of Employment Arrangements for Michael J. Dormer

 

    There are certain arrangements and benefits in place for
    Mr. Michael J. Dormer, Worldwide Chairman, Medical Devices,
    and a Member of the Executive Committee, arising from his prior
    employment as the Chief Operating Officer of DePuy, Inc. When
    Johnson & Johnson acquired DePuy in 1998,
    Mr. Dormer was offered an employment agreement to replace
    his existing employment agreement with DePuy, Inc. In 2001,
    Mr. Dormer and the Company agreed to rescind his employment
    agreement when he was appointed to the Executive Committee and
    named Franchise Group Chairman for Medical Devices. Certain
    benefits and arrangements under Mr. Dormer’s
    employment agreement were retained. The following arrangements
    and benefits were in place during 2005 and continue to be
    available to Mr. Dormer:

 

			
	 	    • 
	
    If Mr. Dormer is terminated for reasons other than
    “cause,” he will receive severance pay equal to the
    greater of one year’s compensation (based on the average of
    the previous two year’s base salary and bonus) and the
    Company’s severance pay policy.

	 
	 	    • 
	
    Mr. Dormer’s pension benefits will cover
    pre-acquisition service with DePuy, Inc.

	 
	 	    • 
	
    Upon retirement or involuntary termination of employment, the
    Company will pay relocation costs associated with
    Mr. Dormer’s relocation to the United Kingdom,
    pursuant to the Company’s relocation policy. In the event
    that Mr. Dormer dies while residing in the United States
    during his employment, the Company will provide full relocation
    assistance for his family’s relocation to the United
    Kingdom, including, managing the sale of his home in the United
    States.

	 
	 	    • 
	
    The Company has funded a term life insurance policy for the
    benefit of Mr. Dormer’s family to offset the negative
    estate tax implications should Mr. Dormer (or his spouse)
    die while residing in the United States during his employment by
    the Company.

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