Health Net 2009 Annual Report Download - page 229

Exhibit 10.28
[DIRECTOR NAME]
[TYPE OF GRANT]
FORM OF
NONQUALIFIED STOCK OPTION AGREEMENT
FOR NON-EMPLOYEE DIRECTORS
UNDER THE HEALTH NET, INC.
2006 LONG-TERM INCENTIVE PLAN,
AS AMENDED
This agreement (the “Option Agreement”) is made as of [DATE] (the “Grant Date”), between Health Net, Inc., a Delaware
corporation (the “Company”), and [NAME], a non-employee director of the Company (the “Optionee”).
Pursuant to the Health Net, Inc. 2006 Long-Term Incentive Plan, as amended (the “Plan”), the Optionee is to be granted, on the
terms and conditions set forth herein, a nonqualified stock option (the “Option”) to purchase shares of Common Stock of the
Company, par value $.001 per share (the “Common Stock”).
1. Number of Shares and Option Price. The Option is to purchase [NUMBER OF SHARES] shares of Common Stock (the
“Option Shares”) at a price of [GRANT PRICE] per share (the “Option Price”), which is equal to the Fair Market Value (as defined
in the Plan) of an Option Share as of the Grant Date.
2. Exercise of Option. The Option shall become exercisable on the date that is one year after the Grant Date to the extent of 33
1/3 % of the Option Shares covered by the Option, and shall become exercisable on each subsequent anniversary of the Grant Date to
the extent of an additional 33 1/3 % of the Option Shares covered by the Option until the Option becomes fully exercisable. The
Option may be exercised only to purchase whole shares, and in no case may a fraction of a share be purchased.
3. Term of Option and Termination of Service.
(a) General Term. The term of the Option and this Option Agreement shall commence on the date hereof. The right of the
Optionee to exercise the Option with respect to any Option Shares, to purchase any such Option Shares and all other rights of the
Optionee with respect to any such Option Shares shall terminate on the seventh anniversary of the Grant Date, unless the Option has
been earlier terminated as provided in paragraphs (b) through (e) below, or under the Plan.
(b) Death of the Optionee. If the Optionee shall die prior to the exercise of the Option, then:
(i) if the Optionee dies while serving as a member of the board of directors of the Company (a “Director”), then the Option
(subject to clause (g) below) may be exercised by the legatee(s) or personal representative of the Optionee at any time within
one year after the Optionee’s death;
(ii) if the Optionee’s service as a Director was terminated due to Permanent and Total Disability (as defined in Section 22
(e)(3) of the Internal Revenue Code of