Document:

Exhibit 10.2

 

AMENDED AND RESTATED 2004 STOCK OPTION PLAN

FOR KEY EMPLOYEES OF

PANAMSAT HOLDING CORPORATION AND ITS
SUBSIDIARIES

 

This Amended and Restated 2004 Stock Option
Plan for Key Employees of PanAmSat Holding Corporation and its Subsidiaries,
initially adopted by the stockholders of PanAmSat Corporation on August 20, 2004,
is hereby assumed on October 14, 2004 by PanAmSat Holding Corporation, and
amended and restated as follows:

 

1.                                       Purpose
of Plan

 

The Amended and Restated 2004 Stock Option
Plan for Key Employees of PanAmSat Holding Corporation and Its Subsidiaries
(the “Plan”) is designed:

 

(a)                                  to
promote the long term financial interests and growth of PanAmSat Holding
Corporation (“Holdco”) and its Subsidiaries by attracting and retaining
management and other personnel with the training, experience and ability to
enable them to make a substantial contribution to the success of Holdco’s
business;

 

(b)                                 to
motivate management personnel by means of growth-related incentives to achieve
long range goals; and

 

(c)                                  to
further the alignment of interests of participants with those of the
stockholders of Holdco through opportunities for increased stock, or
stock-based ownership in Holdco.

 

2.                                       Definitions

 

As used in the Plan, the following words
shall have the following meanings:

 

(a)                                  “Affiliate”
means with respect to any Person, any entity directly or indirectly
controlling, controlled by or under common control with such Person.

 

(b)                                 “Board”
means the Board of Directors of Holdco.

 

(c)                                  “Change
in Control” means in one or a series of transactions (i) the sale of all or
substantially all of the assets of Holdco to an Unaffiliated Person; (ii) a
sale resulting in more than 50% of the voting stock of Holdco being held by an
Unaffiliated Person; (iii) a merger, consolidation, recapitalization or
reorganization of Holdco with or into another Unaffiliated Person; if and only if any such event listed in
clauses (i) through (iii) above results in the inability of the Investors, or
any member or members of the Investors, to designate or elect a majority of the
Board (or the board of directors of the resulting entity or its parent
company).  For purposes of this
definition, the term “Unaffiliated Person” means any Person or Group who
is not (x) an Investor or any member of the Investors, (y) a Rule 405 Affiliate
of any Investor or any member of any Investor, or (z) an entity in which any
Investor, or any member of any Investor holds, directly or indirectly, a
majority of the economic interests in such entity.

 

(d)                                 “Committee”
means the Compensation Committee of the Board or, if no such committee exists,
the Board.

 

 

(e)                                  “Common
Stock” or “Share” means the common stock, par value $0.01 per share, of Holdco,
which may be authorized but unissued, or issued and reacquired.

 

(f)                                    “Company”
means PanAmSat Corporation.

 

(g)                                 “Employee”
means a person, including an officer, in the regular employment of Holdco or
one of its Subsidiaries who, in the opinion of the Committee, is, or is
expected to have involvement in the management, growth or protection of some
part or all of the business of Holdco.

 

(h)                                 “Exchange
Act” means the Securities Exchange Act of 1934, as amended.

 

(i)                                     “Fair
Market Value” means the price per share equal to (i) the average of the last
sale price of the Common Stock for the five trading days ending on the
applicable date on each stock exchange on which the Common Stock may at the
time be listed or, (ii) if there shall have been no sales on any such exchanges
on such date on any given day, the average of the closing bid and asked prices
on each such exchange for the five trading days ending on such date or, (iii)
if there is no such bid and asked price on such date, on the next preceding
date when such bid and asked price occurred or, (iv) if the Common Stock shall
not be so listed, the average of the closing sales prices as reported by NASDAQ
for the five trading days ending on such date in the over-the-counter market
or, (v) if there have been no such sales, bid or asked prices, or if there has
been no Public Offering, the fair market value of the Common Stock as
determined in the good faith discretion of the Board.

 

(j)                                     “Grant”
means an award made to a Participant pursuant to the Plan and described in
Section 5, including, without limitation, an award of a Stock Option, Stock
Appreciation Right or Dividend Equivalent Right (as such terms are defined in
Section 5), or any combination of the foregoing.

 

(k)                                  “Grant
Agreement” means an agreement between the Company, Holdco and a Participant
that sets forth the terms, conditions and limitations applicable to a Grant.

 

(l)                                     “Group”
means “group,” as such term is used for purposes of Section 13(d) or 14(d) of
the Exchange Act.

 

(m)                               “Investors”
means Constellation, LLC, a Delaware limited liability company, Carlyle
PanAmSat I, L.L.C., a Delaware limited liability company, Carlyle PanAmSat II,
L.L.C., a Delaware limited liability company, PEP PAS, LLC, a Delaware limited
liability company, and PEOP PAS, LLC, a Delaware limited liability company.

 

(n)                                 “Participant”
means an Employee, non-employee member of the Board, consultant or other person
having a relationship with Holdco, the Company or one of its Subsidiaries, to
whom one or more Grants have been made and remain outstanding.

 

(o)                                 “Person”
means “person,” as such term is used for purposes of Section 13(d) or 14(d) of
the Exchange Act.

 

(p)                                 “Subsidiary”
means any corporation in an unbroken chain of corporations beginning with
Holdco if each of the corporations, or group of commonly controlled
corporations, other than the last corporation in the unbroken chain then owns
stock possessing 50% or more of

 

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the total combined voting power of all classes of stock in one of the
other corporations in such chain.

 

3.                                       Administration
of Plan

 

(a)                                  The
Plan shall be administered by the Committee. 
The Committee may adopt its own rules of procedure, and action of a
majority of the members of the Committee taken at a meeting, or action taken
without a meeting by unanimous written consent, shall constitute action by the
Committee.  The Committee shall have the
power and authority to administer, construe and interpret the Plan, to make
rules for carrying it out and to make changes in such rules.  Any such interpretations, rules, and
administration shall be consistent with the basic purposes of the Plan.

 

(b)                                 The
Committee may delegate to the Chief Executive Officer and to other senior
officers of Holdco its duties under the Plan subject to such conditions and
limitations as the Committee shall prescribe except that only the Committee may
designate and make Grants to Participants who are subject to Section 16 of the
Exchange Act.

 

(c)                                  The
Committee may employ counsel, consultants, accountants, appraisers, brokers or
other persons.  The Committee, Holdco,
and the officers and directors of Holdco, and Holdco shall be entitled to rely
upon the advice, opinions or valuations of any such persons.  All actions taken and all interpretations and
determinations made by the Committee in good faith shall be final and binding
upon all Participants, the Company, Holdco and all other interested
persons.  No member of the Committee
shall be personally liable for any action, determination or interpretation made
in good faith with respect to the Plan or the Grants, and all members of the
Committee shall be fully protected by Holdco with respect to any such action,
determination or interpretation.

 

4.                                       Eligibility

 

The Committee may from time to time make
Grants under the Plan to such Employees, or other persons having a relationship
Holdco or any of its Subsidiaries, and in such form and having such terms,
conditions and limitations as the Committee may determine.  The terms, conditions and limitations of each
Grant under the Plan shall be set forth in a Grant Agreement, in a form
approved by the Committee, consistent, however, with the terms of the Plan; provided,
however, that such Grant Agreement shall contain provisions dealing with
the treatment of Grants in the event of the termination of employment, death or
disability of a Participant, and may also include provisions concerning the
treatment of Grants in the event of a Change in Control.

 

5.                                       Grants

 

From time to time, the Committee will
determine the forms and amounts of Grants for Participants.  Such Grants may take the following forms in
the Committee’s sole discretion:

 

(a)                                  Stock
Options - These are options to purchase Common Stock.  At the time of Grant the Committee shall
determine, and shall include in the Grant Agreement or other Plan rules, the
option exercise period, the option exercise price, vesting requirements, and
such other terms, conditions or restrictions on the grant or exercise of the
option as the Committee deems appropriate including, without limitation, the
right to receive dividend equivalent payments on vested and/or unvested
options.  In addition to other
restrictions contained in the Plan, an option granted under this Section 5(a)
may not be exercised more than 10 years after the date it is granted.

 

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Payment of the option exercise price shall be made in cash or in shares
of Common Stock that the Participant has held for at least six months, or a
combination thereof, in accordance with the terms of the Plan, the Grant
Agreement and of any applicable guidelines of the Committee in effect at the
time.

 

(b)                                 Stock
Appreciation Rights - The Committee may grant Stock Appreciation Rights in
connection with the grant of a Stock Option. 
Each Stock Appreciation Right shall be subject to such other terms as
the Committee may determine.  A Stock
Appreciation Right means the right to transfer and surrender to Holdco all or a
portion of a Stock Option in exchange for a cash amount equal to the excess of
(i) the aggregate Fair Market Value, as of the date such Stock Option or
portion thereof is transferred or surrendered, of the Common Stock underlying
by such Stock Option or portion thereof, over (ii) the aggregate exercise price
of such Stock Option or portion thereof, relating to such Common Stock.

 

(c)                                  Dividend
Equivalent Rights – The Committee may grant Dividend Equivalent Rights
either alone or in connection with the grant of a Stock Option.  A Dividend Equivalent Right means the right
to receive a payment in respect of one share of Common Stock (whether or not
subject to a Stock Option) equal to the amount of any dividend paid in respect
of one share of Common Stock held by a shareholder in Holdco.  Each Dividend Equivalent Right shall be
subject to such terms as the Committee may determine.

 

6.                                       Limitations
and Conditions

 

(a)                                  The
number of Shares available for Grants under this Plan shall be 5,679,579.802
unless restricted by applicable law. 
Shares related to Grants that are forfeited, terminated, canceled or
expire unexercised, shall immediately become available for new Grants.

 

(b)                                 No
Grants shall be made under the Plan beyond ten years after the effective date
of the Plan, but the terms of Grants made on or before the expiration of the
Plan may extend beyond such expiration. 
At the time a Grant is made or amended or the terms or conditions of a
Grant are changed in accordance with the terms of the Plan or the Grant
Agreement, the Committee may provide for limitations or conditions on such
Grant.

 

(c)                                  Nothing
contained herein shall affect the right of Holdco or any of its Subsidiaries to
terminate any Participant’s employment at any time or for any reason.

 

(d)                                 Other
than as specifically provided in the Form of Management Stockholder’s Agreement
attached hereto as Exhibit A, no benefit under the Plan shall be subject in any
manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, or charge, and any attempt to do so shall be void.  No such benefit shall, prior to receipt
thereof by the Participant, be in any manner liable for or subject to the
debts, contracts, liabilities, engagements, or torts of the Participant.

 

(e)                                  Participants
shall not be, and shall not have any of the rights or privileges of,
stockholders of Holdco in respect of any Shares purchasable in connection with any
Grant unless and until certificates representing any such Shares have been
issued by Holdco to such Participants (or book entry representing such shares
has been made and such Shares have been deposited with the appropriate
registered book-entry custodian).

 

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(f)                                    No
election as to benefits or exercise of any Grant may be made during a
Participant’s lifetime by anyone other than the Participant except by a legal
representative appointed for or by the Participant.

 

(g)                                 Absent
express provisions to the contrary, any Grant under this Plan shall not be
deemed compensation for purposes of computing benefits or contributions under
any retirement plan of Holdco or its Subsidiaries and shall not affect any
benefits under any other benefit plan of any kind now or subsequently in effect
under which the availability or amount of benefits is related to level of
compensation.  This Plan is not a “Retirement
Plan” or “Welfare Plan” under the Employee Retirement Income Security Act of
1974, as amended.

 

(h)                                 Unless
the Committee determines otherwise, no benefit or promise under the Plan shall
be secured by any specific assets of Holdco, the Company or any of its
Subsidiaries, nor shall any assets of Holdco, the Company or any of its
Subsidiaries be designated as attributable or allocated to the satisfaction of
Holdco’s or the Company’s obligations under the Plan.

 

7.                                       Transfers
and Leaves of Absence

 

For purposes of the Plan, unless the
Committee determines otherwise: (a) a transfer of a Participant’s employment
without an intervening period of separation among Holdco and any Subsidiary (or
among any Subsidiaries) shall not be deemed a termination of employment, and
(b) a Participant who is granted in writing a leave of absence or who is
entitled to a statutory leave of absence shall be deemed to have remained in
the employ of Holdco (and any Subsidiary) during such leave of absence.

 

8.                                       Adjustments

 

In the event of any change in the outstanding
Common Stock by reason of a stock split, spin-off, stock combination,
reclassification, recapitalization, liquidation, dissolution, reorganization,
merger, Change in Control, or other event affecting the capital stock of
Holdco, the Committee may adjust appropriately (a) the number and kind of
shares subject to the Plan and available for or covered by Grants and (b) share
prices related to outstanding Grants, and make such other revisions to
outstanding Grants as it deems, in good faith, are equitably required
(including, without limitation, to the exercise price of Stock Options).

 

9.                                       Merger,
Consolidation, Exchange, Acquisition, Liquidation or Dissolution

 

In its absolute discretion, acting in good
faith, and on such terms and conditions as it deems appropriate, coincident
with or after the grant of any Grant, the Committee may provide that such Grant
cannot be exercised after the amalgamation, merger or consolidation of Holdco
with or into another corporation, the exchange of all or substantially all of
the assets of Holdco for the securities of another corporation, the acquisition
by another corporation of 80% or more of Holdco’s then outstanding shares of
voting stock or the recapitalization, reorganization, reclassification,
liquidation, dissolution, or other event affecting the capital stock of Holdco,
and the Committee shall, on such terms and conditions as it deems appropriate,
acting in good faith, also provide, either by the terms of such Grant or by a
resolution adopted prior to the occurrence of such amalgamation, merger, consolidation,
exchange, acquisition, recapitalization, reorganization, reclassification,
liquidation, dissolution or other event affecting the capital stock of Holdco,
that,

 

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after written notice to all affected Participants and for a reasonable
period of time prior to such event, such Grant shall be exercisable as to any
Shares subject thereto which is being made unexercisable after any such event,
notwithstanding anything to the contrary herein (but subject to the provisions
of Section 6(b)) and that, upon the occurrence of such event, such Grant shall
terminate and be of no further force or effect; provided, however,
that the Committee may also provide, in its absolute discretion, that even if
the Grant shall remain exercisable after any such event, from and after such
event, any such Grant shall be exercisable only for the kind and amount of
securities and/or other property, or the cash equivalent thereof (as determined
by the Committee in good faith), receivable as a result of such event by the
holder of a number of Shares for which such Grant could have been exercised
immediately prior to such event.

 

10.                                 Amendment
and Termination

 

(a)                                  The
Committee shall have the authority to make such amendments to any terms and
conditions applicable to outstanding Grants as are consistent with this Plan
provided that no such action shall modify any Grant in a manner adverse to the
Participant without the Participant’s consent except as such modification is
provided for or contemplated in the terms of the Grant or this Plan (except
that any adjustment that is made pursuant to Section 8 or 9 hereof may be made
by the Committee in good faith).

 

(b)                                 The
Board of Directors may amend, suspend or terminate the Plan except that no such
action, other than an action under Section 8 or 9 hereof, may be taken which
would, without stockholder approval, increase the aggregate number of Shares
available for Grants under the Plan, decrease the price of outstanding Grants,
change the requirements relating to the Committee, extend the term of the Plan
or be materially adverse to all Participants with respect to any outstanding
Grants.

 

11.                                 Governing
Law; International Participants

 

(a)                                  This
Plan shall be governed by and construed in accordance with the laws of Delaware
applicable therein.

 

(b)                                 With
respect to Participants who reside or work outside the United States of America
and who are not (and who are not expected to be) “covered employees” within the
meaning of Section 162(m) of the Code, the Committee may, in its sole
discretion, amend the terms of the Plan or Awards with respect to such
Participants in order to conform such terms with the requirements of local law
or to obtain more favorable tax or other treatment for a Participant, Holdco,
the Company or an Affiliate.

 

12.                                 Withholding
Taxes

 

Holdco or any
of the Subsidiaries shall have the right to deduct from any cash payment made
under the Plan any minimum federal, state or local income or other taxes
required by law to be withheld with respect to such payment.  It shall be a condition to the obligation of
Holdco to deliver Shares upon the exercise of a Stock Option that the
Participant pay to Holdco such amount as may be requested by Holdco for the purpose
of satisfying any liability for such minimum withholding taxes.

 

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13.                                 Effective
Date and Termination Dates

 

The Plan shall
be effective on and as of the date of its approval by the stockholders of
Holdco and shall terminate ten years later, subject to earlier termination by
the Board pursuant to Section 10.

 

Approved by stockholders of PanAmSat Corporation on August 20, 2004;
amended and restated and approved by stockholders of Holdco on October 14,
2004.

 

7Exhibit
10.6

 

[FORM OF]

 

AMENDED AND
RESTATED STOCK OPTION AGREEMENT

 

THIS AGREEMENT, initially dated as of
August 20, 2004 (the “Grant Date”) and amended and restated as of
October 29, 2004 is made by and between PanAmSat Holding Corporation, a
Delaware corporation (hereinafter referred to as “Holdco”), and the
individual whose name is set forth on the signature page hereof, who is  an employee of Holdco or a Subsidiary or
Affiliate of Holdco, hereinafter referred to as the “Optionee”.  Any capitalized terms herein not otherwise
defined in Article I shall have the meaning set forth in the Plan (as
hereinafter defined).

 

WHEREAS, PanAmSat Corporation (the “Company”)
adopted the Plan on the Grant Date;

 

WHEREAS, the Compensation Committee of the
Company, appointed to administer the Plan, has determined that it would be to
the advantage and best interest of the Company and its shareholders to grant
the Option provided for herein to the Optionee as an incentive for increased
efforts during his term of office with the Company or its Subsidiaries or
Affiliates, and has advised Holdco thereof and instructed the undersigned
officers to issue said Option;

 

WHEREAS, the Company and the Optionee have
entered into a Stock Option Agreement dated as of August 20, 2004 (the “Original
Stock Option Agreement”);

 

WHEREAS, following the execution of the
Original Stock Option Agreement, the Company effectuated a
1 : 4.36890754 stock split (the “Stock Split”);

 

WHEREAS, the shareholders of the Company have
contributed their shares of PanAmSat Common Stock to Holdco in exchange for
Common Stock, and as a result the Company has become a wholly-owned Subsidiary
of Holdco;

 

WHEREAS, on October 14, 2004, the
Company assigned to Holdco and Holdco assumed from the Company the Plan;

 

WHEREAS, Holdco wishes to carry out the Plan,
the terms of which are hereby incorporated by reference and made a part of this
Agreement;

 

WHEREAS, on October 19, 2004, Holdco
paid an extraordinary dividend of $2.2296 per share (the “Dividend”) of
Common Stock and the Board approved a reduction in the exercise price of the
Option in an amount equal to the Dividend;

 

WHEREAS, Holdco, the Company and the Optionee
wish to amend and restate the Original Stock Option Agreement in order to
reflect (i) the Stock Split, (ii) the assignment of the Plan by the Company and
assumption of the Plan by Holdco, and (iii) the reduction of the exercise price
in connection with the payment of the Dividend; and

 

WHEREAS, the Committee has the authority
under Section 10(a) of the Plan to make adjustments to the Grants to
account for the foregoing events.

 

 

NOW, THEREFORE, in consideration of the
mutual covenants herein contained and other good and valuable consideration,
receipt of which is hereby acknowledged, the parties hereto do hereby amend and
restate the Original Stock Option Agreement as follows:

 

ARTICLE I

 

DEFINITIONS

 

Whenever the following terms are used in this
Agreement, they shall have the meaning specified below unless the context
clearly indicates to the contrary.

 

Section 1.1.                                   - Cause

 

“Cause” shall mean “Cause” as such term may
be defined in any employment agreement between the Optionee and Holdco or any
of its Subsidiaries or Affiliates (the “Employment Agreement”), or, if
there is no such Employment Agreement, “Cause” shall mean: (a) the
Optionee’s willful and continued failure to perform his or her material duties
with respect to Holdco or it Subsidiaries which continues beyond 10 days after
a written demand for substantial performance is delivered to the Optionee by
Holdco (the “Cure Period”), (b) the willful or intentional engaging
by the Optionee in conduct that causes material and demonstrable injury,
monetarily or otherwise, to Holdco, any of the Investors, and their respective
Affiliates, (c) conviction of , or a plea of nolo
contendere to, a crime constituting (A) a felony under the laws of
the United States or any state thereof or (B) a misdemeanor involving moral
turpitude, or (d) a material breach of the Optionee’s Management Stockholder’s
Agreement or other agreements, if any, including, without limitation, engaging
in any action in breach of the restrictive covenants as set forth therein,
which continues beyond the Cure Period (to the extent that, in the Board’s
reasonable judgment, such breach can be cured).

 

Section 1.2.                                   - Change in
Control

 

“Change in Control” means in one or a series
of related transactions (i) the sale of all or substantially all of the assets
of Holdco to an Unaffiliated Person; (ii) a sale resulting in more than 50% of
the voting stock of Holdco being held by an Unaffiliated Person; (iii) a
merger, consolidation, recapitalization or reorganization of Holdco with or
into another Unaffiliated Person; if and
only if any such event listed in clauses (i) through (iii) above
results in the inability of the Investors, or any member or members of the
Investors, to designate or elect a majority of the Board (or the board of
directors of the resulting entity or its parent company).  For purposes of this definition, the term “Unaffiliated
Person” means any Person or Group who is not (x) an Investor or any member
of the Investors, (y) a Rule 405 Affiliate of any Investor or any member of any
Investor, or (z) an entity in which any Investor, or any member of any Investor
holds, directly or indirectly, a majority of the economic interests in such
entity.

 

Section 1.3.                                   - Committee

 

“Committee” shall
mean the Compensation
Committee of the Board, or if no such committee exists, the Board.

 

2

 

Section 1.4.                                   - Common Stock

 

“Common Stock”
shall mean common
stock, par value $0.01 per share, of Holdco.

 

Section 1.5.                                   - Fiscal Year

 

“Fiscal Year” shall mean each fiscal year of
Holdco (which, for the avoidance of doubt, ends on or about November 30 of
any given calendar year).

 

Section 1.6.                                   - Good Reason

 

“Good Reason”
shall mean “Good Reason” as such term is defined in the Employment Agreement,
or if there is no such Employment Agreement, “Good Reason” shall mean (i) a
reduction in the Management Stockholder’s base salary or annual incentive
compensation (other than a general reduction in base salary that affects all
members of senior management in substantially the same proportions, provided
that the Management Stockholder’s base salary is not reduced by more than 10%);
(ii) a substantial reduction in the Management Stockholder’s duties and
responsibilities; or (iii) a transfer of the Management Stockholder’s primary
workplace by more than fifty miles from the current workplace.

 

Section 1.7.                                   - Investors

 

“Investors” means Constellation, LLC, a
Delaware limited liability company, Carlyle PanAmSat I, L.L.C., a Delaware
limited liability company, Carlyle PanAmSat II, L.L.C., a Delaware limited
liability company, PEP PAS, LLC, a Delaware limited liability company, and PEOP
PAS, LLC, a Delaware limited liability company.

 

Section 1.8.                                   - Management
Stockholder’s Agreement

 

“Management Stockholder’s Agreement” shall
mean that certain Amended and Restated Management Stockholder’s Agreement of
even date herewith among the Optionee, the Company and Holdco.

 

Section 1.9.                                   - Option

 

“Option” shall mean the aggregate of the Time
Option and the Performance Option granted under Section 2.1 of this
Agreement.

 

Section 1.10.                             – PanAmSat Common Stock

 

“PanAmSat Common
Stock” shall mean common
stock, par value $0.01 per share, of the Company.

 

Section 1.11.                             - Permanent Disability

 

“Permanent Disability” shall mean
“Disability” as such term is defined in the Employment Agreement, or if there
is no such Employment Agreement, “Permanent Disability”

 

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shall mean the
Optionee becoming physically or mentally incapacitated and is therefore unable
for a period of six (6) consecutive months to perform substantially all of the
material elements of the Optionee’s duties with Holdco or any Subsidiary or
Affiliate thereof.  Any question as to
the existence of the Permanent Disability of the Optionee as to which the
Optionee and Holdco cannot agree shall be determined in writing by a qualified
independent physician mutually acceptable to the Optionee and Holdco.  If the Optionee and Holdco cannot agree as
to a qualified independent physician, each shall appoint such a physician and
those two physicians shall select a third who shall make such determination in
writing.  The determination of Permanent
Disability made in writing to Holdco and the Optionee shall be final and
conclusive for all purposes of this Agreement (such inability is hereinafter
referred to as “Permanent Disability” or being “Permanently Disabled”).

 

Section 1.12.                             - Performance Option

 

“Performance Option” shall mean the right and
option to purchase, on the terms and conditions set forth herein, all or any
part of an aggregate of the number of shares of Common Stock set forth on the
signature page hereof opposite the term Performance Option.

 

Section 1.13.                             - Plan

 

“Plan” shall mean the Amended and Restated
2004 Stock Option Plan for Key Employees of PanAmSat Holding Corporation and
Its Subsidiaries.

 

Section 1.14.                             - Secretary

 

“Secretary” shall mean the Secretary of
Holdco.

 

Section 1.15.                             - Time Option

 

“Time Option” shall mean the right and option
to purchase, on the terms and conditions set forth herein, all or any part of
an aggregate of the number of shares of Common Stock set forth on the signature
page hereof opposite the term Time Option.

 

ARTICLE II

 

GRANT OF OPTIONS

 

Section 2.1.                                   - Grant of
Options

 

For good and valuable consideration, on and
as of the Grant Date the Company irrevocably granted to the Optionee, and
Holdco has now assumed, effective as of October 14, 2004, the obligations
of the Company with respect to the grant of (i) a Time Option to purchase any
part or all of an aggregate of the number of shares set forth on the signature
page hereof of its Common Stock upon the terms and conditions set forth in this
Agreement and (ii) a Performance Option to purchase any part or all of an
aggregate of the number of shares set forth on the signature page hereof of its
Common Stock upon the terms and conditions set forth in this Agreement.  The Option shall consist of a Time Option
and a Performance Option.

 

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Section 2.2.                                   - Exercise Price

 

Subject to Section 2.4, the exercise
price of the shares of Common Stock covered by the Option shall be $[               ] per share (the “Base
Price”) without commission or other charge (which is the Fair Market Value
per share of the Common Stock on the date hereof).

 

Section 2.3.                                   - No Guarantee of
Employment

 

Nothing in this Agreement or in the Plan
shall confer upon the Optionee any right to continue in the employ of Holdco or
any Subsidiary or Affiliate or shall interfere with or restrict in any way the
rights of Holdco and its Subsidiaries or Affiliates, which are hereby expressly
reserved, to terminate the employment of the Optionee at any time for any
reason whatsoever, with or without cause, subject to the applicable provisions
of, if any, the Optionee’s employment agreement with Holdco or any Subsidiary
or Affiliate or offer letter provided by Holdco or any Subsidiary or Affiliate
to the Optionee.

 

Section 2.4.                                   - Adjustments to
Option

 

Subject to Sections 8 and 9 of the Plan, in
the event that the outstanding shares of the stock subject to the Option, are,
from time to time, changed into or exchanged for a different number or kind of
shares of Holdco or other securities by reason of a merger, consolidation,
recapitalization, reclassification, stock split, spin-off, stock dividend,
combination of shares, or other corporate event, the Committee shall make, as appropriate
and equitable, an adjustment in the number and kind of shares and/or the amount
of consideration as to which or for which, as the case may be, such Option, or
portions thereof then unexercised, shall be exercisable, and the Committee may,
as it deems appropriate and equitable, pay to the Optionee an amount in respect
of the shares of Common Stock subject to the Option, with such conditions or
limitations as the Committee may deem reasonable and necessary to preserve the
economic value of the Option.  Any such
adjustment made by the Committee shall be final and binding upon the Optionee,
Holdco and all other interested persons.

 

ARTICLE III

 

PERIOD OF EXERCISABILITY

 

Section 3.1.                                   - Commencement of
Exercisability

 

(a)                                  So long as the Optionee continues
to be employed by Holdco or any of its Subsidiaries or Affiliates, the Option
shall become exercisable pursuant to the following schedules:

 

(i)                                     Time Option.  The Time Option shall become vested and exercisable ratably with
respect to 20% of the shares subject to such Time Option on each of the first
five anniversaries of the Grant Date.

 

(ii)                                  Performance Option.  The Performance Option shall become vested
and exercisable as to 100% of the shares subject to such option on the eighth
anniversary

 

5

 

of the Grant Date; provided, however,
that the exercisability of the Performance Option will be accelerated as to 20%
of the shares of Common Stock subject to such Option at the end of each of the
first five Fiscal Years occurring after the Grant Date, if and only if Holdco achieves both the
EBITDA and Free Cash Flow performance targets set forth on Schedule A
attached hereto (each, an “Annual Performance Target”).  In the event that an Annual Performance
Target is not achieved in a particular Fiscal Year, the vesting of the
Performance Option shall accelerate if both Annual Performance Targets are
achieved in any subsequent fiscal year, such that the Performance Option shall
vest as if all prior Annual Performance Targets had been met.

 

(b)                                 Notwithstanding the foregoing,
(i) the Time Option shall become immediately exercisable as to 100% of the
shares of Common Stock subject to such option immediately prior to a Change in
Control (but only to the extent such option has not otherwise terminated or
become exercisable) and (ii) the Performance Option shall become immediately
exercisable as to 100% of the shares of Common Stock subject to such option
immediately prior to a Change in Control (but only to the extent such option
has not otherwise terminated or become exercisable) if (x) both Annual
Performance Targets have been achieved for each of the prior Fiscal Years or on
a “catch-up” basis or (y) as a result of the Change in Control, (A) the
Investors achieve a gross internal rate of return of not less than 25% (on a
fully diluted basis, assuming the inclusion of all shares of Common Stock
underlying all options), as determined in good faith by the Investors and (B)
the Investors earn at least 3.0 times the Base Price for each share of Common
Stock held (directly or indirectly) by them. 
If a Change in Control occurs during a Fiscal Year, the Board will
determine in good faith what percentage will become vested based upon quarterly
performance targets measuring EBITDA over the trailing twelve month period.

 

(c)                                  Notwithstanding the foregoing,
no Option shall become exercisable as to any additional shares of Common Stock
(which does not otherwise become exercisable in accordance with
Section 3.1(a) or (b) above) following the termination of employment of
the Optionee for any reason and any Option, which is unexercisable as of the
Optionee’s termination of employment, shall be immediately cancelled without
payment therefor.

 

Section 3.2.                                   – Expiration of
Option

 

Except as otherwise provided in
Section 5 or 6 of the Management Stockholder’s Agreement, the Optionee may
not exercise the Option to any extent after the first to occur of the following
events:

 

(a)                                  The tenth anniversary of the
Grant Date;

 

(b)                                 The first anniversary of the
date of the Optionee’s termination of employment, if the Optionee’s employment
is terminated by reason of death or Permanent Disability (unless earlier
terminated as provided in Section 3.2(g) below);

 

(c)                                  Immediately upon the date of the
Optionee’s termination of employment by Holdco or its Subsidiaries or
Affiliates for Cause;

 

6

 

(d)                                 One hundred and eighty (180)
days after the date of an Optionee’s termination of employment by Holdco or any
of its Subsidiaries or Affiliates without Cause (for any reason other than as
set forth in Section 3.2(b));

 

(e)                                  One hundred and eighty (180)
days after the date of an Optionee’s termination of employment with Holdco or
any of its Subsidiaries or Affiliates by the Optionee with Good Reason;

 

(f)                                    Thirty (30) days after the date
of an Optionee’s termination of employment with Holdco or any of its
Subsidiaries or Affiliates by the Optionee without Good Reason;

 

(g)                                 The date the Option is
terminated pursuant to Section 5 or 6 of the Management Stockholder’s
Agreement; or

 

(h)                                 At the discretion of Holdco, if
the Committee so determines pursuant to Section 9 of the Plan, the
effective date of either the merger or consolidation of Holdco into another
Person, or the exchange or acquisition by another Person of all or
substantially all of Holdco’s assets or 80% or more of its then outstanding
voting stock, or the recapitalization, reclassification, liquidation,
dissolution or other corporate event of Holdco after (x) ten (10) days prior
written notice to the Optionee that Holdco intends to exercise such discretion
and an opportunity for the Optionee to exercise his Options (whether or not
then vested), (y) payment to the Optionee in respect of the termination of his
Options, or (z) an opportunity for the Executive to rollover his Options into
new stock options, in connection with such transaction.

 

ARTICLE IV

 

EXERCISE OF OPTION

 

Section 4.1.                                   – Person Eligible
to Exercise

 

Except as otherwise provided in the
Management Stockholder’s Agreement, during the lifetime of the Optionee, only
he may exercise an Option or any portion thereof.  After the death of the Optionee, any exercisable portion of an
Option may, prior to the time when an Option becomes unexercisable under
Section 3.2, be exercised by his personal representative or by any person
empowered to do so under the Optionee’s will or under the then applicable laws
of descent and distribution.

 

Section 4.2.                                   – Partial
Exercise

 

Any exercisable portion of an Option or the
entire Option, if then wholly exercisable, may be exercised in whole or in part
at any time prior to the time when the Option or portion thereof becomes
unexercisable under Section 3.2; provided, however, that any
partial exercise shall be for whole shares of Common Stock only.

 

7

 

Section 4.3.                                   – Manner of
Exercise

 

An Option, or any exercisable portion
thereof, may be exercised solely by delivering to the Secretary or his office
all of the following prior to the time when the Option or such portion becomes
unexercisable under Section 3.2:

 

(a)                                  Notice in writing signed by the
Optionee or the other person then entitled to exercise the Option or portion
thereof, stating that the Option or portion thereof is thereby exercised, such
notice complying with all applicable rules established by the Committee;

 

(b)                                 Full payment (in cash or by
check or by a combination thereof) for the shares with respect to which such
Option or portion thereof is exercised;

 

(c)                                  A bona fide written
representation and agreement, in a form satisfactory to the Committee, signed
by the Optionee or other person then entitled to exercise such Option or
portion thereof, stating that the shares of Common Stock are being acquired for
his own account, for investment and without any present intention of
distributing or reselling said shares or any of them except as may be permitted
under the Securities Act of 1933, as amended (the “Act”), and then
applicable rules and regulations thereunder, and that the Optionee or other
person then entitled to exercise such Option or portion thereof will indemnify
Holdco against and hold it free and harmless from any loss, damage, expense or
liability resulting to Holdco if any sale or distribution of the shares by such
person is contrary to the representation and agreement referred to above; provided,
however, that the Committee may, in its reasonable discretion, take
whatever additional actions it deems reasonably necessary to ensure the
observance and performance of such representation and agreement and to effect
compliance with the Act and any other federal or state securities laws or
regulations;

 

(d)                                 Full payment to Holdco of all
amounts which, under federal, state or local law, it is required to withhold
upon exercise of the Option; and

 

(e)                                  In the event the Option or
portion thereof shall be exercised pursuant to Section 4.1 by any person
or persons other than the Optionee, appropriate proof of the right of such
person or persons to exercise the option.

 

Without
limiting the generality of the foregoing, the Committee may require an opinion
of counsel acceptable to it to the effect that any subsequent transfer of
shares acquired on exercise of an Option does not violate the Act, and may
issue stop-transfer orders covering such shares.  Share certificates evidencing stock issued on exercise of this
Option shall bear an appropriate legend referring to the provisions of
subsection (c) above and the agreements herein. The written representation
and agreement referred to in subsection (c) above shall, however, not be
required if the shares to be issued pursuant to such exercise have been
registered under the Act, and such registration is then effective in respect of
such shares.

 

Section 4.4.                                   – Conditions to
Issuance of Stock Certificates

 

The shares of stock deliverable upon the
exercise of an Option, or any portion thereof, may be either previously
authorized but unissued shares or issued shares, which have then been
reacquired by Holdco.  Such shares shall
be fully paid and nonassessable.  Holdco

 

8

 

shall not be
required to issue or deliver any certificate or certificates for shares of
stock purchased upon the exercise of an Option or portion thereof prior to
fulfillment of all of the following conditions:

 

(a)                                  The obtaining of approval or
other clearance from any state or federal governmental agency which the
Committee shall, in its reasonable and good faith discretion, determine to be
necessary or advisable; and

 

(b)                                 The lapse of such reasonable
period of time following the exercise of the Option as the Committee may from
time to time establish for reasons of administrative convenience or as may
otherwise be required by applicable law.

 

Section 4.5.                                   – Rights as
Stockholder

 

Except as otherwise provided in
Section 2.4 of this Agreement, the holder of an Option shall not be, nor
have any of the rights or privileges of, a stockholder of Holdco in respect of
any shares purchasable upon the exercise of the Option or any portion thereof unless
and until certificates representing such shares shall have been issued by
Holdco to such holder.

 

ARTICLE V

 

MISCELLANEOUS

 

Section 5.1.                                   – Administration

 

The Committee shall have the power to
interpret the Plan and this Agreement and to adopt such rules for the
administration, interpretation and application of the Plan as are consistent
therewith and to interpret or revoke any such rules.  All actions taken and all interpretations and determinations made
by the Committee shall be final and binding upon the Optionee, Holdco and all
other interested persons.  No member of
the Committee shall be personally liable for any action, determination or
interpretation made in good faith with respect to the Plan or the Option.  In its absolute discretion, the Board may at
any time and from time to time exercise any and all rights and duties of the
Committee under the Plan and this Agreement.

 

Section 5.2.                                   – Option Not
Transferable

 

Neither the Option nor any interest or right
therein or part thereof shall be liable for the debts, contracts or engagements
of the Optionee or his successors in interest or shall be subject to
disposition by transfer, alienation, anticipation, pledge, encumbrance,
assignment or any other means whether such disposition be voluntary or involuntary
or by operation of law by judgment, levy, attachment, garnishment or any other
legal or equitable proceedings (including bankruptcy), and any attempted
disposition thereof shall be null and void and of no effect; provided, however,
that this Section 5.2 shall not prevent transfers by will or by the
applicable laws of descent and distribution.

 

9

 

Section 5.3.                                   – Notices

 

Any notice to be given under the terms of
this Agreement to Holdco shall be addressed to Holdco in care of its Secretary,
and any notice to be given to the Optionee shall be addressed to him at the
address given beneath his signature hereto. 
By a notice given pursuant to this Section 5.3, either party may
hereafter designate a different address for notices to be given to him.  Any notice, which is required to be given to
the Optionee, shall, if the Optionee is then deceased, be given to the
Optionee’s personal representative if such representative has previously
informed Holdco of his status and address by written notice under this
Section 5.3.  Any notice shall have
been deemed duly given when enclosed in a properly sealed envelope or wrapper
addressed as aforesaid, deposited (with postage prepaid) in a post office or
branch post office regularly maintained by the United States Postal Service.

 

Section 5.4.                                   – Titles;
Pronouns

 

Titles are provided herein for convenience
only and are not to serve as a basis for interpretation or construction of this
Agreement.  The masculine pronoun shall
include the feminine and neuter, and the singular the plural, where the context
so indicates.

 

Section 5.5.                                   – Applicability
of Plan and Management Stockholder’s Agreement

 

The Option and the shares of Common Stock
issued to the Optionee upon exercise of the Option shall be subject to all of
the terms and provisions of the Plan and the Management Stockholder’s
Agreement, to the extent applicable to the Option and such shares.  In the event of any conflict between this
Agreement and the Plan, the terms of the Plan shall control.  In the event of any conflict between this
Agreement or the Plan and the Management Stockholder’s Agreement, the terms of
the Management Stockholder’s Agreement shall control.

 

Section 5.6.                                   – Amendment

 

This Agreement may be amended only by a
writing executed by the parties hereto, which specifically states that it is
amending this Agreement.

 

Section 5.7.                                   – Governing Law

 

The laws of
the State of Delaware shall govern the interpretation, validity and performance
of the terms of this Agreement regardless of the law that might be applied
under principles of conflicts of laws.

 

Section 5.8.                                   – Arbitration

 

In the event of any controversy among the
parties hereto arising out of, or relating to, this Agreement which cannot be
settled amicably by the parties, such controversy shall be finally, exclusively
and conclusively settled by mandatory arbitration conducted expeditiously in
accordance with the American Arbitration Association rules, by a single
independent arbitrator.  Such
arbitration process shall take place within 100 miles of the New York City
metropolitan area.  The decision of the
arbitrator shall be final and binding upon all parties hereto and shall be
rendered pursuant to a written decision, which contains a detailed recital of the
arbitrator’s

 

10

 

reasoning.  Judgment upon the award rendered may be
entered in any court having jurisdiction thereof.  Each party shall bear its own legal fees and expenses, unless
otherwise determined by the arbitrator. 
Notwithstanding anything herein to the contrary, if the Employment
Agreement contains a similar provision relating to arbitration and/or dispute
resolution, such provision in the Employment Agreement shall govern any
controversy hereunder.

 

[Signatures on next
page.]

 

11

 

IN WITNESS WHEREOF, this Agreement has been
executed and delivered by the parties hereto.

 

	
   

  	
  PANAMSAT HOLDING CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Its:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Acknowledged and agreed:

  	
   

  
	
   

  	
   

  
	
  PANAMSAT CORPORATION

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Its:

  	
   

  	
   

  	
   

  

 

 

	
   

  	
   

  	
  OPTIONEE:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Aggregate
  number of shares of Common Stock for which the Time Option granted hereunder is exercisable (100% of
  number of shares):

  	
   

  	
  [                    ]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Aggregate
  number of shares of Common Stock for which the Performance Option granted hereunder is exercisable
  (100% of number of shares):

  	
   

  	
  [                    ]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Base Price:

  	
   

  	
  $[          ]
  per share

  
	
   

  	
   

  	
   

  
	
  Grant Date:

  	
   

  	
  August 20,
  2004

  

 

 

Schedule A

 

Annual
Performance Targets

 

The Annual
Performance Targets are based on Holdco’s achievement of the following (i)
Adjusted EBITDA and (ii) Adjusted EBITDA minus capital expenditures (“Free Cash
Flow”) targets for the following Fiscal Years:

 

	
  Fiscal Year

  	
   

  	
  Adjusted
  EBITDA Target

  	
   

  	
  Free Cash
  Flow Target

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2005:

  	
   

  	
  $

  	
  [                    

  	
  ]

  	
  $

  	
  [                    

  	
  ]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2006:

  	
   

  	
  $

  	
  [                    

  	
  ]

  	
  $

  	
  [                    

  	
  ]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2007:

  	
   

  	
  $

  	
  [                    

  	
  ]

  	
  $

  	
  [                    

  	
  ]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2008:

  	
   

  	
  $

  	
  [                    

  	
  ]

  	
  $

  	
  [                    

  	
  ]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2009:

  	
   

  	
  $

  	
  [                    

  	
  ]

  	
  $

  	
  [                    

  	
  ]

  

 

Annual
Performance Targets will be equitably adjusted by the Board, in consultation
with management, for any acquisitions, divestitures or major capital investment
programs not contemplated in the management plan, and for any change in
accounting treatment of equity compensation. 
Annual Performance Targets will be equitably adjusted for other accounting
changes and for other customary adjustment events on a basis consistent with
normal practice.

 

“Adjusted
EBITDA” shall have the meaning as defined in the Indenture dated as of
August 20, 2004, among PanAmSat Corporation, the Guarantors named on
Schedule I thereto and The Bank of New York, Trustee, for $1,010,000,000
of 9% Senior Notes Due 2014.

 

For purposes
of determining the vesting of Performance Options for years in which the Annual
Performance Targets were not met under the last sentence of Section 3.1(a)(ii),
any amounts actually earned by Holdco in excess of the Adjusted EBITDA Target
and Free Cash Flow Targets for FY 2004 shall be taken into account for purposes
of satisfying any cumulative Performance Targets (and not with respect to any
Annual Performance Target for any particular fiscal year).

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