Health Net 2004 Annual Report Download - page 112

HEALTH NET, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The following table summarizes the weighted average exercise price and weighted average remaining contractual life for
significant option groups outstanding at December 31, 2004:
Note 8—Capital Stock
Options Outstanding Options Exercisable
Range of
Exercise Prices
Number of
Options
Weighted
Average
Remaining
Contractual
Life
(Years)
Weighted
Average
Exercise
Price
Number of
Options
Weighted
Average
Exercise
Price
$ 7.63–$21.88 1,300,514 3.22 $11.99 1,284,131 $11.86
22.01– 22.88
2,585,906 7.43 22.44 1,170,542 22.45
23.02– 23.94 2,476,073 6.37 23.14 1,981,157 23.02
24.00– 24.91
2,410,073 8.07 24.07 410,159 24.07
25.06– 26.90 1,230,821 6.17 25.73 276,323 25.81
27.00– 27.84
724,000 7.16 27.54 297,003 27.54
28.20– 28.90 1,620,354 8.93 28.87 69,500 28.61
29.00– 31.95
486,550 6.44 30.93 229,847 30.69
32.01– 36.25 1,210,238 4.14 32.77 953,788 32.70
$ 7.63–$36.25 14,044,529 6.69 $24.35 6,672,450 $22.86
As of December 31, 2004, there were 111,277,199 shares of our Common Stock outstanding.
Shareholder Rights Plan
On May 20, 1996, our Board of Directors declared a dividend distribution of one right (a “Right”) for each outstanding share of
our common stock to stockholders of record at the close of business on July 31, 1996 (the “Record Date”). Our Board of Directors
also authorized the issuance of one Right for each share of common stock issued after the Record Date and prior to the earliest of the
“Distribution Date,” the redemption of the Rights and the expiration of the Rights, and in certain other circumstances, after the
Distribution Date. Except as set forth in the Rights Agreement (as defined below) and subject to adjustment as provided in the Rights
Agreement, each Right entitles the registered holder to purchase from us one one-thousandth of a share of Series A Junior
Participating Preferred Stock at a purchase price of $170 per Right. Rights will attach to all common stock certificates representing
shares then outstanding and no separate Rights certificates will be distributed. Subject to certain exceptions contained in the Rights
Agreement dated as of June 1, 1996 by and between us and Harris Trust and Savings Bank, as Rights Agent (as amended on October
1, 1996, May 3, 2001, May 14, 2004 and July 26, 2004, the “Rights Agreement”), the Rights will separate from the Common Stock
following any person, together with its affiliates and associates (an “Acquiring Person”), becoming the beneficial owner of 15% or
more of the outstanding common stock, the commencement of a tender or exchange offer that would result in any person, together
with its affiliates and associates, becoming the beneficial owner of 15% or more of the outstanding common stock or the
determination by the Board of Directors that a person, together with its affiliates and associates, has become the beneficial owner of
10% or more of the common stock and that such person is an “Adverse Person,” as defined in the Rights Agreement. The Rights
Agreement provides that certain passive institutional investors that beneficially own less than 20% of the outstanding shares of our
common stock shall not be deemed to be Acquiring Persons.
The Rights will first become exercisable on the Distribution Date and will expire on July 31, 2006, unless earlier redeemed by
us as described below.
F-26