Health Net 2009 Annual Report Download - page 252

(ii) Control Purchase. The purchase by any person (as such term is defined in Sections 13(d)(3) and 14(d)(2) of the
Exchange Act), corporation or other entity (other than the Company or any employee benefit plan sponsored by an Employer) of
any Common Stock of the Company (or securities convertible into the Company’s Common Stock) for cash, securities or any
other consideration pursuant to a tender offer or exchange offer, without the prior consent of the Board and, after such purchase,
such person shall be the “beneficial owner” (as such term is defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing 20 percent or more of the combined voting power of the then outstanding
securities of the Company ordinarily (and apart from rights accruing under special circumstances) having the right to vote in the
election of directors (calculated as provided in Section (d) of such Rule 13d-3 in the case of rights to acquire the Company’s
securities);
(iii) Board Change. A change in the composition of the Board during any period of two consecutive years, such that
individuals who at the beginning of such period constitute the entire Board shall cease for any reason to constitute a majority
thereof unless the election, or the nomination for election by the Company’s stockholders, of each new director was approved by
a vote of at least two-thirds of the directors then still in office who were directors at the beginning of the period; or
(iv) Other Transactions. The occurrence of such other transactions involving a significant issuance of voting stock or
change in Board composition that the Board determines to be a Change in Control for purposes of the Plan.
6.8 No Contractual Rights to Serve. Nothing in the Plan shall be interpreted as conferring any right on any Director to continue
as a Director.
6.9 Severability. If a provision of the Plan shall be held illegal or invalid, the illegality or invalidity shall not affect the
remaining parts of the Plan and the Plan shall be construed and enforced as if the illegal or invalid provision had not been included in
the Plan.
6.10 Tax Withholding; Section 409A. Any payment required under the Plan shall be subject to all requirements of the law with
regard to income and withholding taxes, filings, and making of reports, and the Company and Participant shall use their best efforts to
satisfy promptly all such requirements. For purposes of this Plan, a Participant’s service as a Director will not be treated as terminated
unless and until such termination of service constitutes a “separation from service” for purposes of Section 409A of the Code. It is the
intention of the Company that the provisions of the Plan not result in taxation of Participants under Section 409A of the Code and the
regulations and guidance promulgated thereunder and that the Plan shall be construed in accordance with such intention.
6.11 Applicable Law. The Plan and all rights hereunder and all determinations made and actions taken pursuant thereto, to the
extent not otherwise governed by the Code or the laws of the United States, shall be governed by the laws of the State of Delaware
and construed in accordance therewith without giving effect to the principles of conflicts of laws.
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