Document:

EXHIBIT 10.4

 

FORM OF

CROWN MEDIA HOLDINGS,
INC.

2004 RESTRICTED STOCK
UNIT AGREEMENT

 

THIS
RESTRICTED STOCK UNIT AGREEMENT (the “Agreement”) is made and entered into as
of May 28, 2004 (the “Grant Date”), by and between Crown Media Holdings, Inc. a
Delaware corporation (“Crown”) and
                               (“Executive”)
pursuant to the terms and conditions of the Amended and Restated Crown Media
Holdings, Inc. 2000 Long Term Incentive Plan (the “Plan”).  Capitalized terms not defined in this
Amended Agreement shall have the meanings set forth in the Plan.

 

1.  Award of Restricted
Stock Units.

 

(a)           General
Award.  Pursuant to the Plan, Crown
awards to Executive                        
Restricted Stock Units
(“RSUs”), each unit corresponding to one share of Crown Common Stock (as
defined in the Plan), subject to the terms and conditions set forth in this
Agreement and the Plan.  A copy of the
Plan has been delivered to the Executive. By signing below, the Executive
agrees to be bound by all the provisions of the Plan.  Each RSU constitutes an unsecured promise of Crown to deliver
either a share of Common Stock or cash in an amount equivalent to one share of
Common Stock to Executive on the Delivery Date (as defined below).  As a holder of RSUs, Executive has only the
rights of a general unsecured creditor of Crown.

 

(b)           Types of
RSUs.  Of the total                                RSUs granted to Executive, 70% (                ) shall be deemed to be Employment
RSUs and 30% (                        ) shall be deemed to be Performance
RSUs.  The applicable provisions of this
Agreement shall be specified by type of RSU, and if not so specified, shall
apply to all RSUs granted hereunder.

 

2. 
Vesting 

 

(a)           Employment
RSUs.  Subject to continued
employment with Crown and/or its affiliates as of each anniversary of the Grant
Date (unless one of the events enumerated in Section 4 of this
Agreement shall have occurred) the Employment RSUs shall vest and become
nonforfeitable in equal one-third installments (or as nearly equal installments
as practicable) on each of the first, second and third anniversaries of the
Grant Date.  In the
event of a Change in Control, subject to the Executive’s continued employment
with Crown as of the date of the Change in Control (unless one of the events
enumerated in Section 4 of this Agreement shall have occurred), all unvested
Employment RSUs shall vest.  Each
anniversary of the Grant Date, the date immediately prior to that on which a
Change in Control occurs and the date on which any one of the events in Section
4 occurs shall be a “Vesting Date.”

 

 

(b)           Performance
RSUs.

 

(i) 
Regular Vesting.  Subject to continued employment
with Crown and/or its affiliates, the Performance RSUs shall vest and become
nonforfeitable in their entirety only upon the third anniversary of the Grant
Date and only if the average of the Fair Market Value (as defined below) of the
Common Stock for the immediately preceding 60 business days including the
Vesting Date (or, if such Vesting Date does not fall on a business day, as of
the business day immediately preceding the Vesting Date) equals or exceeds
$14.00 (USD).  The
third anniversary of the Grant Date shall be a “Vesting Date.”  Section 4 shall not apply to Performance
RSUs.

 

(ii) 
Vesting upon a Change in Control.  The date on which a Change in
Control occurs shall be a “Vesting Date.” 
In the event of a Change in Control (subject to the Executive’s
continued employment with Crown as of the date of the Change in Control or upon an
Executive’s involuntary Termination of Employment without Cause within 90 days
prior to the date on which a Change in Control occurs), all
unvested Performance RSUs shall vest and be settled immediately prior to the
Change in Control only if the following shall have occurred:  if the Change in Control occurs prior to the
first anniversary of the Grant Date, the average of the Fair Market
Value (as defined below) of the Common Stock for the immediately preceding 60
business days including the Vesting Date (or, if such Vesting Date does not
fall on a business day, as of the business day immediately preceding the
Vesting Date) equals or exceeds $10.00 (USD). 
If the Change in Control occurs on or after the first
anniversary of the Grant Date but prior to the second anniversary of the Grant
Date, the average of the Fair Market Value (as defined below) of the
Common Stock for the immediately preceding 60 business days including the
Vesting Date (or, if such Vesting Date does not fall on a business day, as of
the business day immediately preceding the Vesting Date) equals or exceeds
$12.00 (USD).  If the Change
in Control occurs on or after the second anniversary of the Grant Date but
prior to the third anniversary of the Grant Date, the
average of the Fair Market Value (as defined below) of the Common Stock for the
immediately preceding 60 business days including the Vesting Date (or, if such
Vesting Date does not fall on a business day, as of the business day
immediately preceding the Vesting Date) equals or exceeds $14.00 (USD).

 

3. 
Settlement of RSU Award.

 

(a) Settlement.  Subject to any cancellation of the
Employment RSUs pursuant to Section 4, Crown shall deliver to Executive on the
Delivery Date, at Crown’s sole, absolute and unfettered discretion, either:  (1) the number of shares of Common Stock
corresponding to such RSUs; or (2) cash in an amount equal to the number of
shares of Common Stock corresponding to such RSUs multiplied by the average of
the Fair Market Value (as defined below) of the Common Stock

 

 

for the immediately preceding 14 business
days including the Vesting Date (or, if such Vesting Date does not fall on a
business day, as of the business day immediately preceding the Vesting Date)
unless Executive has otherwise elected to defer receipt of such award in accordance
with Committee authorization or pursuant to the terms of a nonqualified plan
adopted by Crown.  Crown shall have
sole, absolute and unfettered discretion in determining whether to deliver
shares of Common Stock or cash in an amount equivalent to the number of shares
of Common Stock on the Vesting Date.

 

(b) Change in Control Settlement.  Notwithstanding Section 3(a), in the event
of a Change in Control, Section 10(c) of the Plan shall apply to RSUs.  RSUs shall be settled under Section 3(a)
using the Change in Control Price pursuant to Section 10(c) of the Plan
applicable to non-Incentive Stock Option holders.

 

(c) Dividend and Stock Split
Equivalents.  For so long as
Executive holds RSUs, at the time any dividend is paid with respect to a share
of Common Stock or any forward stock split occurs, Crown shall credit to the
RSU award of the Executive on the same date (or as soon as practicable
thereafter) in respect of each RSU held by the Executive as of the record date
for such dividend or split an amount at Crown’s sole, absolute and unfettered
discretion, in cash, Common Stock, or other property, or in a combination
thereof, in each case having a value equal to the dividend or split, subject to
any deferral election by Executive in accordance with Committee authorization
or pursuant to the terms of a nonqualified plan adopted by Crown.  Such amounts shall vest and shall be paid on
a pro rata basis at the same time
as the underlying Employment or Performance RSU award with which such dividend
or stock split is associated is settled.

 

4. 
Termination of Employment RSUs and Non-Delivery Upon Certain Other
Events, Acceleration of Vesting.

 

Executive’s rights with respect to any
outstanding unvested Employment RSUs shall immediately terminate and no payment
shall be made in respect of such RSUs if prior to the Vesting Date Executive
experiences a Termination of Employment (as defined in the Plan).  Notwithstanding the foregoing, any outstanding unvested Employment
RSUs shall vest immediately upon an Executive’s Termination of Employment by
reason of : (1) the death of the Executive; (2) the Disability of the Executive
; (3) the retirement of the Executive from Crown at the “normal retirement age”
as defined in the Hallmark Affiliates Employee Savings Plan, or any successor
plan; (4) an Executive’s involuntary Termination of Employment without Cause
within 90 days prior to the date on which a Change in Control occurs; or (5) an
Executive’s involuntary Termination of Employment without Cause within 90 days
prior to the date on which any sale, merger, or other disposition
or sale of substantially all of the assets of the Crown subsidiary or affiliate
for which Executive is principally employed occurs

 

 

(such determination of principal employment to be made
by Crown in its reasonable discretion).

 

5. 
Definitions.  For purposes
of this Agreement:

 

(a) “Delivery Date” means the day
immediately following a given Vesting Date.

 

(b) 
“Fair Market Value” means “Fair Market Value” as defined in the Plan;
provided, however, that if there is no regular public trading market for such
Common Stock, “Fair Market Value” shall mean the value established by the most
recent independent appraisal of Crown conducted prior to the relevant Delivery
Date.

 

6. 
Withholding Tax.

 

Executive may be subject to withholding
taxes as a result of the settlement of RSUs. Unless the Committee permits
otherwise, Executive shall pay to Crown in cash, promptly when the amount of
such obligations become determinable, all applicable federal, state, local and
foreign withholding taxes that Crown determines result from such settlement.
Unless the Committee otherwise determines and subject to such rules and
procedures as the Committee may establish, Executive may make an election to
have shares of Stock withheld by Crown or to tender any such securities to
Crown to pay the amount of tax that Crown in its discretion determines to be
required so to be withheld by Crown upon settlement of RSUs, subject to
satisfying any applicable requirements for compliance with Section 16(b) of the
Exchange Act. Any shares of Stock or other securities so withheld or tendered
will be valued as of the date they are withheld or tendered, provided that
Stock shall be valued at Fair Market Value on such date. Unless otherwise permitted
by the Committee, the value of shares withheld or tendered may not exceed the
minimum federal, state, local and foreign withholding tax obligations as
computed by Crown.

 

7. 
Non-transferability.

 

No RSUs shall be assignable or otherwise
transferable by Executive. During the life of Executive any elections with
respect to RSUs may be made only by Executive or Executive’s guardian or legal
representative.

 

8. 
Counterparts.

 

This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.

 

 

9. 
Governing Law.

 

This Agreement shall be governed by the
laws of the State of Delaware, without regard to conflict of law principles.

 

	
   

  	
  CROWN MEDIA
  HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  EXECUTIVEExhibit
10.5

 

CROWN MEDIA HOLDINGS, INC.

2004 RESTRICTED STOCK UNIT AGREEMENT

 

THIS RESTRICTED
STOCK UNIT AGREEMENT (the “Agreement”) is made and entered into as of May 28,
2004 (the “Grant Date”), by and between Crown Media Holdings, Inc. a Delaware
corporation (“Crown”) and David Evans (“Executive”) pursuant to the terms and
conditions of the Amended and Restated Crown Media Holdings, Inc. 2000 Long
Term Incentive Plan (the “Plan”). Capitalized terms not defined in this
Agreement shall have the meanings set forth in the Plan.

 

1.  Award of
Restricted Stock Units.  Pursuant to
the Plan, Crown awards to Executive 115,000 Restricted Stock Units (“RSUs”).
Each unit corresponds to one share of Crown Common Stock (as defined in the
Plan) and shall be subject to the terms and conditions set forth in this
Agreement and the Plan.  A copy of the
Plan has been delivered to the Executive. By signing below, the Executive
agrees to be bound by all the provisions of the Plan. Each RSU constitutes an
unsecured promise of Crown to deliver either a share of Common Stock or cash in
an amount equivalent to one share of Common Stock to Executive on the Delivery
Date (as defined below).  As a holder of
RSUs, Executive has only the rights of a general unsecured creditor of Crown.

 

2.  Vesting.  Subject to Section 4 of this Agreement,
the RSUs shall vest and become nonforfeitable in equal one-half installments on
each of January 3, 2005 (“First Vesting Date”) and January 2, 2006
(“Second Vesting Date”).  In the event
of a Change in Control, subject to the Executive’s continued employment with
Crown as of the date of the Change in Control (unless one of the events
enumerated in Section 4 of this Agreement shall have occurred), all
unvested RSUs shall vest.  The First
Vesting Date, the Second Vesting Date, the date immediately prior to that on
which a Change in Control occurs and the date on which any one of the events in
Section 4 occurs shall be a “Vesting Date.”

 

3.  Settlement of RSU Award.

 

(a) Settlement. Crown shall deliver to Executive
on the Delivery Date, at Crown’s sole, absolute and unfettered discretion,
either: (1) the number of shares of Common Stock corresponding to such RSUs; or
(2) cash in an amount equal to the number of shares of Common Stock
corresponding to such RSUs multiplied by the average of the Fair Market Value
(as defined below) of the Common Stock for the immediately preceding 14
business days including the Vesting Date (or, if such Vesting Date does not
fall on a business day, as of the business day immediately preceding the
Vesting Date) unless Executive has otherwise elected to defer receipt of such
award in accordance with Committee authorization or pursuant to the terms of a
nonqualified plan adopted by Crown. Crown shall have sole, absolute and unfettered
discretion in determining whether to deliver shares of Common Stock or cash in
an amount equivalent to the number of shares of Common Stock on the Vesting
Date.

 

1

 

(b) Change in Control Settlement.  Notwithstanding Section 3(a), in the
event of a Change in Control, Section 10(c) of the Plan shall apply to
RSUs. RSUs shall be settled under Section 3(a) using the Change in Control
Price pursuant to Section 10(c) of the Plan applicable to non-Incentive
Stock Option holders.

 

(c) Dividend and Stock Split Equivalents. For
so long as Executive holds RSUs, at the time any dividend is paid with respect
to a share of Common Stock or any forward stock split occurs, Crown shall
credit to the RSU award of the Executive on the same date (or as soon as
practicable thereafter) in respect of each RSU held by the Executive as of the
record date for such dividend or split an amount at Crown’s sole, absolute and
unfettered discretion, in cash, Common Stock, or other property, or in a
combination thereof, in each case having a value equal to the dividend or
split, subject to any deferral election by Executive in accordance with
Committee authorization or pursuant to the terms of a nonqualified plan adopted
by Crown.  Such amounts shall vest and
shall be paid on a pro rata basis
at the same time as the underlying Employment or Performance RSU award with
which such dividend or stock split is associated is settled.

 

4.  Termination
of RSUs; Accelerated Vesting. 
Executive’s rights with respect to any outstanding unvested RSUs shall
immediately terminate and no payment shall be made in respect of such RSUs (i)
with respect to the First Vesting Date, if prior to such date, Executive
experiences a Termination of Employment (as defined in the Plan) with Crown,
excluding a Normal Retirement or (ii) with respect to the Second Vesting Date,
if prior to September 17, 2005, Executive experiences a Termination of
Employment (as defined in the Plan) with Crown, excluding Normal Retirement.  Notwithstanding the foregoing, all
outstanding unvested RSUs shall vest immediately by reason of: (1) Executive’s
involuntary Termination of Employment without Cause (2) the death of the
Executive; or (3) the Disability of the Executive resulting in Executive’s
Termination of Employment.

 

5.  Definitions.  For purposes of this Agreement:

 

(a)                                  “Change
in Control” means Change in Control as defined in the Plan.

 

(b)                                 “Delivery
Date” means the date immediately following a given Vesting Date.

 

(c)                                  “Fair
Market Value” means “Fair Market Value” as defined in the Plan; provided,
however, that if there is no regular public trading market for such Common
Stock, “Fair Market Value” shall mean the value established by the most recent
independent appraisal of Crown conducted prior to the relevant Delivery Date.

 

2

 

(d)                                 “Normal
Retirement” means the retirement of Executive from Crown at the “normal
retirement age” as defined in the Hallmark Employees Affiliates Savings Plan,
or any successor plan.

 

6.  Withholding Tax.  Executive may be subject to withholding
taxes as a result of the settlement of RSUs. Unless the Committee permits
otherwise, Executive shall pay to Crown in cash, promptly when the amount of
such obligations become determinable, all applicable federal, state, local and
foreign withholding taxes that Crown determines result from such
settlement.  Unless the Committee
otherwise determines and subject to such rules and procedures as the Committee
may establish, Executive may make an election to have shares of Stock withheld
by Crown or to tender any such securities to Crown to pay the amount of tax
that Crown in its discretion determines to be required so to be withheld by
Crown upon settlement of RSUs, subject to satisfying any applicable
requirements for compliance with Section 16(b) of the Exchange Act.  Any shares of Stock or other securities so
withheld or tendered will be valued as of the date they are withheld or tendered,
provided that Stock shall be valued at Fair Market Value on such date.   Unless otherwise permitted by the
Committee, the value of shares withheld or tendered may not exceed the minimum
federal, state, local and foreign withholding tax obligations as computed by
Crown.

 

7.  Non-transferability. No RSUs shall be
assignable or otherwise transferable by Executive. During the life of Executive
any elections with respect to RSUs may be made only by Executive or Executive’s
guardian or legal representative.

 

8.  Counterparts.  This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

 

9.  Governing Law.  This Agreement shall be governed by the laws
of the State of Delaware, without regard to conflict of law principles.

 

 

	
   

  	
  CROWN MEDIA HOLDINGS,
  INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ C. Stanford

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Exec. VP - Leg. &
  Bus. Affairs

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ David Evans

  	
   July 2, 04

  
	
   

  	
  DAVID EVANS

  	
   

  
					

 

3

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