Health Net 2009 Annual Report Download - page 202

allowance (a grandfathered benefit), in each case, as long as Executive remains employed by the Company. The Company or its
subsidiaries or affiliates may modify, terminate or amend any fringe benefit or perquisite in its discretion, retroactively or
prospectively, subject only to applicable law.
D. Incentive Bonus. Executive will be eligible to participate in the Health Net, Inc. Executive Officer Incentive Plan
(“EOIP”) in accordance with the terms of the EOIP, which provides Executive with a target bonus for each plan year equal to 80% of
Executive’s Base Salary as additional compensation according to the terms of the EOIP. The actual bonus payment will range from
0% to 200% of target depending upon the actual results achieved, and specific, individually tailored measures will be established by
the Company that must be achieved by Executive in order for Executive to be eligible to receive bonus payments for a given plan
year. It is understood that the Committee and the Company will award bonus amounts, if any, as it deems appropriate consistent with
the EOIP.
E. Expenses. Subject to and in accordance with the Company’s written policies for business and travel expenses, Executive
will receive reimbursement for all business travel and other out-of-pocket expenses reasonably incurred by Executive in the
performance of Executive’s duties pursuant to this Agreement.
8. Equity Grants.
A. Future Equity Grants. Any future equity grants made to Executive will be granted under one of the Company’s Long-
Term Incentive Plans, and will be subject to the terms of such plan and of the agreement executed in connection with such grant. Any
future equity grants to Executive will be made at the discretion of the Committee.
B. Company Stock Ownership Requirement. In accordance with the Executive Officer Stock Ownership Policy adopted by
the Board of Directors of the Company, as may be amended from time to time (the “Executive Stock Ownership Policy”), Executive
is currently required to own shares of Common Stock of the Company having a value of one times (1x) Executive’s Base Salary in
effect from time to time pursuant to this Agreement (the “Stock Ownership Requirement”). The number of shares of Common Stock
Executive is required to own will be calculated based on the average NYSE closing price per share of the Company’s Common Stock
(as adjusted for stock splits and similar changes to the Common Stock) for the most recently completed fiscal year of the Company.
Using Executive’s current salary of $450,000.00 and a stock price of $15.92, which is the average closing price per share
of the Company’s Common Stock as of December 31, 2009, Executive’s current stock ownership requirement is 28,266 (“Target
Amount”). The Target Amount is subject to change from time to time based on (1) changes in the average closing sales price of the
Company’s Common Stock on an annual basis, (2) any changes in Executive’s Base Salary made pursuant to and in accordance with
Section 1B of this Agreement, and (3) any changes under the terms of the Executive Stock Ownership Policy. Any shares of
Company Common Stock that Executive owns, and any restricted stock units, shares of restricted stock or performance shares of the
Company that Executive owns and have vested count toward the Target Amount. Stock options, unvested restricted stock units,
unvested shares of restricted stock, unvested performance shares and shares of Common Stock gifted to others do not count toward
the Target Amount.
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