EXHIBIT 10.2
Exhibit 1
FIRST HEALTH GROUP CORP.
STOCK OPTION AGREEMENT
THIS AGREEMENT is made and entered into as of the 22nd day of March,
2004, by and between FIRST HEALTH GROUP CORP. a Delaware corporation (the
"Company"), and XXXXXXX XXXXXXXXX (the "Employee").
WHEREAS, the Employee is a valued employee of the Company and the
Company wishes to induce him to enter into an employment agreement dated as
of March 22, 2004 (the "Employment Agreement") and to provide financial
incentives to further encourage him in the performance of his duties
thereunder by granting him an option to purchase shares of common stock,
$.01 par value, of the Company (the "Common Stock");
WHEREAS, the Employee wishes to acquire the right to purchase shares of
Common Stock.
NOW, THEREFORE, for good and valuable consideration, the parties
hereto, intending to be legally bound, hereby agrees as follows:
1. Grant of Option. Subject to the provisions of Section 2 hereof,
the Company hereby grants to the Employee effective as of the date hereof
the right, privilege and option to purchase on the terms and conditions
hereinafter set forth up to 62,500 shares of Common Stock at a purchase
price of $21.08 per share (the "Option") pursuant to the Company's 2001
Stock Option Plan (the "Plan"). The Option is intended to be an "Incentive
Stock Option" as defined in Section 422 of the Internal Revenue Code of
1986, as amended (the "Code"), subject to Section 422 of the Code, to the
extent permitted by the Code, and a nonstatutory option with respect to the
balance. In addition to the terms and conditions set forth in this Stock
Option Agreement, the Option is governed by and subject to the terms and
conditions of the Plan.
2. Time for Exercise of Option. Subject to the provisions of Section
3 and 7 hereof, the Option may be exercised by the Employee from time to
time, in whole or in part, beginning on March 22, 2005 and ending on March
22, 2011, or within such shorter period as is provided in Section 3 hereof.
3. Termination of Employment.
(a) If the Employee's employment by the Company is terminated by the
Company without cause, then, notwithstanding the provisions of Section 2 of
this Agreement, upon such termination of employment, the Option shall become
exercisable in full and the Employee may, for a period of 90 days following
such termination (but before expiration of the original exercise period),
exercise the Option in whole or in part.
(b) If the Employee's employment by the Company is terminated due to
death or incapacity (as this term is defined in Employee's Employment
Agreement) or by voluntary, not for cause reasons as allowed under the
Employment Agreement, then, notwithstanding Section 2 of this Agreement, the
Option shall be entirely vested and exercisable in full and Employee or his
legal representative may, for a period of two years following such
termination (but before expiration of the original exercise period),
exercise the Option in whole or in part.
(c) If (i) the Employee's employment by the Company is terminated
voluntarily by the Employee and (ii) pursuant to Section 2 hereof the Option
has heretofore vested, the Employee may, for a period of 30 days after the
date of the termination (but before expiration of the original exercise
period), exercise the Option, in whole or in part.
(d) If the Employee's employment by the Company is terminated by the
Company for cause (as such term is defined in the Employment Agreement), the
Option shall terminate on the date on which the Employee's employment is
terminated, and the Employee shall have no further rights hereunder.
(e) The Employee acknowledges and understands that certain exercises
of the Option pursuant to this Section 3 may cause disqualification of the
Option as an Incentive Stock Option.
4. Method of Exercise. The Option may be exercised by written notice
(the "Notice") addressed and delivered to the Company (Attention: Chief
Financial Officer), specifying the number of shares of Common Stock to be
purchased and accompanied by (i) a check, or (ii) that number of shares of
Common Stock which have an aggregate fair market value as of the date of
exercise equal to the exercise price, or (iii) any combination thereof. For
purposes of this Agreement, "fair market value" of a share of Common Stock
shall mean: (i) if the Common Stock is traded on a national stock exchange
on the date of exercise of the Option, fair market value shall be the
closing price reported by the applicable composite transactions report on
such day, or if the Common Stock is not traded on such date, the mean
between the closing bid-and-asked prices thereof on that date on such
exchange; (ii) if the Common Stock is traded over-the counter and is
classified as a national market issue on the date of exercise of the Option,
fair market value shall be the last reported transaction price quoted by the
NASDAQ on that day; (iii) if the Common Stock is traded over-the-counter and
is not classified as a national market issue on the date of exercise of the
Option, fair market value shall be the mean between the last representative
bid-and-asked prices quoted by the NASDAQ on that day; or (iv) if none of
the foregoing provisions is applicable, fair market value as of the date of
exercise of the Option shall be determined by the Board of Directors in good
faith on such basis as it deems appropriate. In all cases, the
determination of fair market value shall be binding and conclusive on all
persons.
5. Delivery of Stock Certificates. The Option shall be deemed to
have been exercised upon receipt by the Company of the Notice accompanied by
the exercise price (the "Exercise Date"). The certificate representing the
shares of Common Stock purchased upon exercise of the Option shall be issued
as of the Exercise Date and delivered by the Company to the Employee free
and clear of all claims, liens and encumbrances, within five days following
the Exercise Date or as soon thereafter as practicable. As a condition to
the exercise of the Option, the Company may require the Employee to
represent and warrant at the time of any such exercise that the shares of
Common Stock are being purchased for investment purposes only, for the
account of the Employee and without any intention to distribute such shares.
If the shares of Common Stock issuable upon exercise of the Option have not
previously been registered under the Securities Act of 1933, as amended (the
"Securities Act") as contemplated by this Agreement, each certificate
evidencing shares of Common Stock acquired upon exercise of the Option shall
contain on its face, or on the reverse side thereof, the following legend:
"These shares have not been registered under the Securities
Act of 1933 or under any applicable state law They may not be
offered for sale, sold, transferred, or pledged without (1)
registration under the Securities Act of 1933 and any
applicable state law, or (2) an opinion (satisfactory to the
corporation) that registration is not required"
6. Adjustment Provisions. If, during the term of this Agreement,
there shall be any stock dividend, stock rights distribution, stock split,
recapitalization, merger, consolidation, sale of assets, reorganization or
other similar change or transaction of or by the Company, an appropriate
adjustment shall be made to the number and kind of shares remaining to be
acquired upon exercise of the Option and to the exercise price of the Option
so that the value to be received by the Employee upon exercise of the Option
shall, in the aggregate, be the same as if none of the foregoing
transactions had occurred.
7. Merger; Consolidation or Sale of Assets. In the event the Company
enters into an agreement providing for (i) the sale of all or substantially
all of the assets of the Company or (ii) a merger, consolidation or
reorganization which would result in the stockholders of the Company
immediately prior to such transaction owning less than 50% of the surviving
corporation, the Option shall become exercisable in full without regard to
any vesting limitations, and the Employee shall be entitled, commencing at
least ten days prior to the effective date of such transaction, to exercise
the Option in whole or in part, to the extent not previously exercised.
8. Withholding Obligations. In the event that the Company is
required to satisfy withholding obligations under the Code as a result of
the exercise of the Option, the Employee may request that, in lieu of
withholding amounts from the Employee's paycheck or requiring that the
Employee write a check to the Company in the amount of the withholding
obligation, the Company withhold that number of shares of Common Stock which
have a fair market value (determined in accordance with the provisions of
the Plan) on the Exercise Date equal to the amount required to be withheld.
9. Non-Transferability. The Option is not transferable or assignable
by the Employee other than by will or by the laws of descent and
distribution and are exercisable during the lifetime of the Employee only by
the Employee.
10. Compliance with Law. By accepting the Option, the Employee agrees
for himself and his legal representative that the Company shall not be
required to deliver any shares of Common Stock upon the exercise of the
Option until such shares have been qualified for delivery under applicable
securities laws and regulations as determined by the Company or its legal
counsel.
11. Rights as a Stockholder; Not an Employment Agreement. The
Employee shall have no rights as a stockholder of the Company with respect
to shares of Common Stock subject to the Option until the Option has been
exercised and payment made as herein provided and certificates representing
the shares as to which the Option has been exercised have been delivered to
the Employee. Nothing contained in this Agreement shall be construed to be a
contract of employment between the Company and the Employee.
12. Construction.
(a) Successors. This Agreement and all the terms and provisions hereof
shall be binding upon and shall inure to the benefit of the parties hereto
and their respective legal representatives, heirs and successors, except as
expressly herein otherwise provided.
(b) Entire Agreement Modification. This Agreement contains the entire
understanding between the parties with respect to the matters referred to
herein, and such agreement shall not be modified, except by written
instrument signed by the parties hereto.
(c) Headings; Pronouns; Governing Law. The descriptive headings of
the respective sections and subsections of this Agreement are inserted for
convenience of reference only and shall not be deemed to modify or construe
the provisions which follow them. Any use of any masculine pronoun shall
include the feminine and vice-versa, and any use of a singular, the plural
and vice-versa,, as the context and facts may require. The construction and
interpretation of this Agreement shall be governed in all respects by the
laws of the State of Delaware.
(d) Notices. All communications between the parties shall be in
writing and shall be deemed to have been duly given as of the date and time
of hand delivery or three days after mailing via certified or registered
mail, return receipt requested, proper postage prepaid following or such
other addresses of which the parties shall from time to time notify another:
If to the Company: Chief Executive Officer
First Health Group Corp.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxxx 00000
If to the Employee: Xx. Xxxxxxx XxXxxxxxx
First Health Group Corp.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxxx 00000
(e) Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement or the application
thereof to any party or circumstance shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the minimal extent of
such provision or the remaining provisions of this Agreement or the
application of such provision to other parties or circumstances.
IN WITNESS WHEREOF, the parties have executed or caused to be executed
this Agreement as of the date first above written.
FIRST HEALTH GROUP CORP.
-------------------------------------
Xxxxxx X. Xxxxxxx
President and Chief Executive Officer
-------------------------------------
Xxxxxxx XxXxxxxxx
Exhibit 2
FIRST HEALTH GROUP CORP.
STOCK OPTION AGREEMENT
THIS AGREEMENT is made and entered into as of the 22nd day of March,
2004, by and between FIRST HEALTH GROUP CORP. a Delaware corporation (the
"Company"), and XXXXXXX XXXXXXXXX (the "Employee").
WHEREAS, the Employee is a valued employee of the Company and the
Company wishes to induce him to enter into an employment agreement dated as
of March 22, 2004 (the "Employment Agreement") and to provide financial
incentives to further encourage him in the performance of his duties
thereunder by granting him an option to purchase shares of common stock,
$.01 par value, of the Company (the "Common Stock");
WHEREAS, the Employee wishes to acquire the right to purchase shares of
Common Stock.
NOW, THEREFORE, for good and valuable consideration, the parties
hereto, intending to be legally bound, hereby agrees as follows:
1. Grant of Option. Subject to the provisions of Section 2 hereof,
the Company hereby grants to the Employee effective as of the date hereof
the right, privilege and option to purchase on the terms and conditions
hereinafter set forth up to 62,500 shares of Common Stock at a purchase
price of $22.134 per share (the "Option") pursuant to the Company's 2001
Stock Option Plan (the "Plan"). The Option is intended to be an "Incentive
Stock Option" as defined in Section 422 of the Internal Revenue Code of
1986, as amended (the "Code"), subject to Section 422 of the Code, to the
extent permitted by the Code, and a nonstatutory option with respect to the
balance. In addition to the terms and conditions set forth in this Stock
Option Agreement, the Option is governed by and subject to the terms and
conditions of the Plan.
2. Time for Exercise of Option. Subject to the provisions of Section
3 and 7 hereof, the Option may be exercised by the Employee from time to
time, in whole or in part, beginning on March 22, 2006 and ending on March
22, 2011, or within such shorter period as is provided in paragraph 3
hereof.
3. Termination of Employment.
(a) If the Employee's employment by the Company is terminated by the
Company without cause, then, notwithstanding the provisions of Section 2 of
this Agreement, upon such termination of employment, the Option shall become
exercisable in full and the Employee may, for a period of 90 days following
such termination (but before expiration of the original exercise period),
exercise the Option in whole or in part.
(b) If the Employee's employment by the Company is terminated due to
death or incapacity (as this term is defined in Employee's Employment
Agreement) or by voluntary, not for cause reasons as allowed under the
Employment Agreement, then, notwithstanding Section 2 of this Agreement, the
Option shall be entirely vested and exercisable in full and Employee or his
legal representative may, for a period of two years following such
termination (but before expiration of the original exercise period),
exercise the Option in whole or in part.
(c) If (i) the Employee's employment by the Company is terminated
voluntarily by the Employee and (ii) pursuant to Section 2 hereof the Option
has heretofore vested, the Employee may, for a period of 30 days after the
date of the termination (but before expiration of the original exercise
period), exercise the Option, in whole or in part.
(d) If the Employee's employment by the Company is terminated by the
Company for cause (as such term is defined in the Employment Agreement), the
Option shall terminate on the date on which the Employee's employment is
terminated, and the Employee shall have no further rights hereunder.
(e) The Employee acknowledges and understands that certain exercises
of the Option pursuant to this Section 3 may cause disqualification of the
Option as an Incentive Stock Option.
4. Method of Exercise. The Option may be exercised by written notice
(the "Notice") addressed and delivered to the Company (Attention: Chief
Executive Officer), specifying the number of shares of Common Stock to be
purchased and accompanied by (i) a check, or (ii) that number of shares of
Common Stock which have an aggregate fair market value as of the date of
exercise equal to the exercise price, or (iii) any combination thereof. For
purposes of this Agreement, "fair market value" of a share of Common Stock
shall mean: (i) if the Common Stock is traded on a national stock exchange
on the date of exercise of the Option, fair market value shall be the
closing price reported by the applicable composite transactions report on
such day, or if the Common Stock is not traded on such date, the mean
between the closing bid-and-asked prices thereof on that date on such
exchange; (ii) if the Common Stock is traded over-the counter and is
classified as a national market issue on the date of exercise of the Option,
fair market value shall be the last reported transaction price quoted by the
NASDAQ on that day; (iii) if the Common Stock is traded over-the-counter and
is not classified as a national market issue on the date of exercise of the
Option, fair market value shall be the mean between the last representative
bid-and-asked prices quoted by the NASDAQ on that day; or (iv) if none of
the foregoing provisions is applicable, fair market value as of the date of
exercise of the Option shall be determined by the Board of Directors in good
faith on such basis as it deems appropriate. In all cases, the
determination of fair market value shall be binding and conclusive on all
persons.
5. Delivery of Stock Certificates. The Option shall be deemed to
have been exercised upon receipt by the Company of the Notice accompanied by
the exercise price (the "Exercise Date"). The certificate representing the
shares of Common Stock purchased upon exercise of the Option shall be issued
as of the Exercise Date and delivered by the Company to the Employee free
and clear of all claims, liens and encumbrances, within five days following
the Exercise Date or as soon thereafter as practicable. As a condition to
the exercise of the Option, the Company may require the Employee to
represent and warrant at the time of any such exercise that the shares of
Common Stock are being purchased for investment purposes only, for the
account of the Employee and without any intention to distribute such shares.
If the shares of Common Stock issuable upon exercise of the Option have not
previously been registered under the Securities Act of 1933, as amended (the
"Securities Act") as contemplated by this Agreement, each certificate
evidencing shares of Common Stock acquired upon exercise of the Option shall
contain on its face, or on the reverse side thereof, the following legend:
"These shares have not been registered under the Securities
Act of 1933 or under any applicable state law They may not be
offered for sale, sold, transferred, or pledged without (1)
registration under the Securities Act of 1933 and any
applicable state law, or (2) an opinion (satisfactory to the
corporation) that registration is not required"
6. Adjustment Provisions. If, during the term of this Agreement,
there shall be any stock dividend, stock rights distribution, stock split,
recapitalization, merger, consolidation, sale of assets, reorganization or
other similar change or transaction of or by the Company, an appropriate
adjustment shall be made to the number and kind of shares remaining to be
acquired upon exercise of the Option and to the exercise price of the Option
so that the value to be received by the Employee upon exercise of the Option
shall, in the aggregate, be the same as if none of the foregoing
transactions had occurred.
7. Merger; Consolidation or Sale of Assets. In the event the Company
enters into an agreement providing for (i) the sale of all or substantially
all of the assets of the Company or (ii) a merger, consolidation or
reorganization which would result in the stockholders of the Company
immediately prior to such transaction owning less than 50% of the surviving
corporation, the Option shall become exercisable in full without regard to
any vesting limitations, and the Employee shall be entitled, commencing at
least ten days prior to the effective date of such transaction, to exercise
the Option in whole or in part, to the extent not previously exercised.
8. Withholding Obligations. In the event that the Company is
required to satisfy withholding obligations under the Code as a result of
the exercise of the Option, the Employee may request that, in lieu of
withholding amounts from the Employee's paycheck or requiring that the
Employee write a check to the Company in the amount of the withholding
obligation, the Company withhold that number of shares of Common Stock which
have a fair market value (determined in accordance with the provisions of
the Plan) on the Exercise Date equal to the amount required to be withheld.
9. Non-Transferability. The Option is not transferable or assignable
by the Employee other than by will or by the laws of descent and
distribution and are exercisable during the lifetime of the Employee only by
the Employee.
10. Compliance with Law. By accepting the Option, the Employee agrees
for himself and his legal representative that the Company shall not be
required to deliver any shares of Common Stock upon the exercise of the
Option until such shares have been qualified for delivery under applicable
securities laws and regulations as determined by the Company or its legal
counsel.
11. Rights as a Stockholder; Not an Employment Agreement. The
Employee shall have no rights as a stockholder of the Company with respect
to shares of Common Stock subject to the Option until the Option has been
exercised and payment made as herein provided and certificates representing
the shares as to which the Option has been exercised have been delivered to
the Employee. Nothing contained in this Agreement shall be construed to be a
contract of employment between the Company and the Employee.
12. Construction.
(a) Successors. This Agreement and all the terms and provisions hereof
shall be binding upon and shall inure to the benefit of the parties hereto
and their respective legal representatives, heirs and successors, except as
expressly herein otherwise provided.
(b) Entire Agreement Modification. This Agreement contains the entire
understanding between the parties with respect to the matters referred to
herein, and such agreement shall not be modified, except by written
instrument signed by the parties hereto.
(c) Headings; Pronouns; Governing Law. The descriptive headings of
the respective sections and subsections of this Agreement are inserted for
convenience of reference only and shall not be deemed to modify or construe
the provisions which follow them. Any use of any masculine pronoun shall
include the feminine and vice-versa, and any use of a singular, the plural
and vice-versa,, as the context and facts may require. The construction and
interpretation of this Agreement shall be governed in all respects by the
laws of the State of Delaware.
(d) Notices. All communications between the parties shall be in
writing and shall be deemed to have been duly given as of the date and time
of hand delivery or three days after mailing via certified or registered
mail, return receipt requested, proper postage prepaid following or such
other addresses of which the parties shall from time to time notify another:
If to the Company: Chief Executive Officer
First Health Group Corp.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxxx 00000
If to the Employee: Xx. Xxxxxxx XxXxxxxxx
First Health Group Corp.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxxx 00000
(e) Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement or the application
thereof to any party or circumstance shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the minimal extent of
such provision or the remaining provisions of this Agreement or the
application of such provision to other parties or circumstances.
IN WITNESS WHEREOF, the parties have executed or caused to be executed
this Agreement as of the date first above written.
FIRST HEALTH GROUP CORP.
-------------------------------------
Xxxxxx X. Xxxxxxx
President and Chief Executive Officer
-------------------------------------
Xxxxxxx XxXxxxxxx
Exhibit 3
FIRST HEALTH GROUP CORP.
STOCK OPTION AGREEMENT
THIS AGREEMENT is made and entered into as of the 22nd day of March,
2004, by and between FIRST HEALTH GROUP CORP. a Delaware corporation (the
"Company"), and XXXXXXX XXXXXXXXX (the "Employee").
WHEREAS, the Employee is a valued employee of the Company and the
Company wishes to induce him to enter into an employment agreement dated as
of March 22, 2004 (the "Employment Agreement") and to provide financial
incentives to further encourage him in the performance of his duties
thereunder by granting him an option to purchase shares of common stock,
$.01 par value, of the Company (the "Common Stock");
WHEREAS, the Employee wishes to acquire the right to purchase shares of
Common Stock.
NOW, THEREFORE, for good and valuable consideration, the parties
hereto, intending to be legally bound, hereby agrees as follows:
1. Grant of Option. Subject to the provisions of Section 2 hereof,
the Company hereby grants to the Employee effective as of the date hereof
the right, privilege and option to purchase on the terms and conditions
hereinafter set forth up to 62,500 shares of Common Stock at a purchase
price of $23.188 per share (the "Option") pursuant to the Company's 2001
Stock Option Plan (the "Plan"). The Option is intended to be an "Incentive
Stock Option" as defined in Section 422 of the Internal Revenue Code of
1986, as amended (the "Code"), subject to Section 422 of the Code, to the
extent permitted by the Code, and a nonstatutory option with respect to the
balance. In addition to the terms and conditions set forth in this Stock
Option Agreement, the Option is governed by and subject to the terms and
conditions of the Plan.
2. Time for Exercise of Option. Subject to the provisions of Section
3 and 7 hereof, the Option may be exercised by the Employee from time to
time, in whole or in part, beginning on March 22, 2007 and ending on March
22, 2011, or within such shorter period as is provided in paragraph 3
hereof.
3. Termination of Employment.
(a) If the Employee's employment by the Company is terminated by the
Company without cause, then, notwithstanding the provisions of Section 2 of
this Agreement, upon such termination of employment, the Option shall become
exercisable in full and the Employee may, for a period of 90 days following
such termination (but before expiration of the original exercise period),
exercise the Option in whole or in part.
(b) If the Employee's employment by the Company is terminated due to
death or incapacity (as this term is defined in Employee's Employment
Agreement) or by voluntary, not for cause reasons as allowed under the
Employment Agreement, then, notwithstanding Section 2 of this Agreement, the
Option shall be entirely vested and exercisable in full and Employee or his
legal representative may, for a period of two years following such
termination (but before expiration of the original exercise period),
exercise the Option in whole or in part.
(c) If (i) the Employee's employment by the Company is terminated
voluntarily by the Employee and (ii) pursuant to Section 2 hereof the Option
has heretofore vested, the Employee may, for a period of 30 days after the
date of the termination (but before expiration of the original exercise
period), exercise the Option, in whole or in part.
(d) If the Employee's employment by the Company is terminated by the
Company for cause (as such term is defined in the Employment Agreement), the
Option shall terminate on the date on which the Employee's employment is
terminated, and the Employee shall have no further rights hereunder.
(e) The Employee acknowledges and understands that certain exercises
of the Option pursuant to this Section 3 may cause disqualification of the
Option as an Incentive Stock Option.
4. Method of Exercise. The Option may be exercised by written notice
(the "Notice") addressed and delivered to the Company (Attention: Chief
Executive Officer), specifying the number of shares of Common Stock to be
purchased and accompanied by (i) a check, or (ii) that number of shares of
Common Stock which have an aggregate fair market value as of the date of
exercise equal to the exercise price, or (iii) any combination thereof. For
purposes of this Agreement, "fair market value" of a share of Common Stock
shall mean: (i) if the Common Stock is traded on a national stock exchange
on the date of exercise of the Option, fair market value shall be the
closing price reported by the applicable composite transactions report on
such day, or if the Common Stock is not traded on such date, the mean
between the closing bid-and-asked prices thereof on that date on such
exchange; (ii) if the Common Stock is traded over-the counter and is
classified as a national market issue on the date of exercise of the Option,
fair market value shall be the last reported transaction price quoted by the
NASDAQ on that day; (iii) if the Common Stock is traded over-the-counter and
is not classified as a national market issue on the date of exercise of the
Option, fair market value shall be the mean between the last representative
bid-and-asked prices quoted by the NASDAQ on that day; or (iv) if none of
the foregoing provisions is applicable, fair market value as of the date of
exercise of the Option shall be determined by the Board of Directors in good
faith on such basis as it deems appropriate. In all cases, the
determination of fair market value shall be binding and conclusive on all
persons.
5. Delivery of Stock Certificates. The Option shall be deemed to
have been exercised upon receipt by the Company of the Notice accompanied by
the exercise price (the "Exercise Date"). The certificate representing the
shares of Common Stock purchased upon exercise of the Option shall be issued
as of the Exercise Date and delivered by the Company to the Employee free
and clear of all claims, liens and encumbrances, within five days following
the Exercise Date or as soon thereafter as practicable. As a condition to
the exercise of the Option, the Company may require the Employee to
represent and warrant at the time of any such exercise that the shares of
Common Stock are being purchased for investment purposes only, for the
account of the Employee and without any intention to distribute such shares.
If the shares of Common Stock issuable upon exercise of the Option have not
previously been registered under the Securities Act of 1933, as amended (the
"Securities Act") as contemplated by this Agreement, each certificate
evidencing shares of Common Stock acquired upon exercise of the Option shall
contain on its face, or on the reverse side thereof, the following legend:
"These shares have not been registered under the Securities
Act of 1933 or under any applicable state law They may not be
offered for sale, sold, transferred, or pledged without (1)
registration under the Securities Act of 1933 and any
applicable state law, or (2) an opinion (satisfactory to the
corporation) that registration is not required"
6. Adjustment Provisions. If, during the term of this Agreement,
there shall be any stock dividend, stock rights distribution, stock split,
recapitalization, merger, consolidation, sale of assets, reorganization or
other similar change or transaction of or by the Company, an appropriate
adjustment shall be made to the number and kind of shares remaining to be
acquired upon exercise of the Option and to the exercise price of the Option
so that the value to be received by the Employee upon exercise of the Option
shall, in the aggregate, be the same as if none of the foregoing
transactions had occurred.
7. Merger; Consolidation or Sale of Assets. In the event the Company
enters into an agreement providing for (i) the sale of all or substantially
all of the assets of the Company or (ii) a merger, consolidation or
reorganization which would result in the stockholders of the Company
immediately prior to such transaction owning less than 50% of the surviving
corporation, the Option shall become exercisable in full without regard to
any vesting limitations, and the Employee shall be entitled, commencing at
least ten days prior to the effective date of such transaction, to exercise
the Option in whole or in part, to the extent not previously exercised.
8. Withholding Obligations. In the event that the Company is
required to satisfy withholding obligations under the Code as a result of
the exercise of the Option, the Employee may request that, in lieu of
withholding amounts from the Employee's paycheck or requiring that the
Employee write a check to the Company in the amount of the withholding
obligation, the Company withhold that number of shares of Common Stock which
have a fair market value (determined in accordance with the provisions of
the Plan) on the Exercise Date equal to the amount required to be withheld.
9. Non-Transferability. The Option is not transferable or assignable
by the Employee other than by will or by the laws of descent and
distribution and are exercisable during the lifetime of the Employee only by
the Employee.
10. Compliance with Law. By accepting the Option, the Employee agrees
for himself and his legal representative that the Company shall not be
required to deliver any shares of Common Stock upon the exercise of the
Option until such shares have been qualified for delivery under applicable
securities laws and regulations as determined by the Company or its legal
counsel.
11. Rights as a Stockholder; Not an Employment Agreement. The
Employee shall have no rights as a stockholder of the Company with respect
to shares of Common Stock subject to the Option until the Option has been
exercised and payment made as herein provided and certificates representing
the shares as to which the Option has been exercised have been delivered to
the Employee. Nothing contained in this Agreement shall be construed to be a
contract of employment between the Company and the Employee.
12. Construction.
(a) Successors. This Agreement and all the terms and provisions hereof
shall be binding upon and shall inure to the benefit of the parties hereto
and their respective legal representatives, heirs and successors, except as
expressly herein otherwise provided.
(b) Entire Agreement Modification. This Agreement contains the entire
understanding between the parties with respect to the matters referred to
herein, and such agreement shall not be modified, except by written
instrument signed by the parties hereto.
(c) Headings; Pronouns; Governing Law. The descriptive headings of
the respective sections and subsections of this Agreement are inserted for
convenience of reference only and shall not be deemed to modify or construe
the provisions which follow them. Any use of any masculine pronoun shall
include the feminine and vice-versa, and any use of a singular, the plural
and vice-versa,, as the context and facts may require. The construction and
interpretation of this Agreement shall be governed in all respects by the
laws of the State of Delaware.
(d) Notices. All communications between the parties shall be in
writing and shall be deemed to have been duly given as of the date and time
of hand delivery or three days after mailing via certified or registered
mail, return receipt requested, proper postage prepaid following or such
other addresses of which the parties shall from time to time notify another:
If to the Company: Chief Executive Officer
First Health Group Corp.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxxx 00000
If to the Employee: Xx. Xxxxxxx XxXxxxxxx
First Health Group Corp.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxxx 00000
(e) Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement or the application
thereof to any party or circumstance shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the minimal extent of
such provision or the remaining provisions of this Agreement or the
application of such provision to other parties or circumstances.
IN WITNESS WHEREOF, the parties have executed or caused to be executed
this Agreement as of the date first above written.
FIRST HEALTH GROUP CORP.
-------------------------------------
Xxxxxx X. Xxxxxxx
President and Chief Executive Officer
-------------------------------------
Xxxxxxx XxXxxxxxx
Exhibit 4
FIRST HEALTH GROUP CORP.
STOCK OPTION AGREEMENT
THIS AGREEMENT is made and entered into as of the 22nd day of March,
2004, by and between FIRST HEALTH GROUP CORP. a Delaware corporation (the
"Company"), and XXXXXXX XXXXXXXXX (the "Employee").
WHEREAS, the Employee is a valued employee of the Company and the
Company wishes to induce him to enter into an employment agreement dated as
of March 22, 2004 (the "Employment Agreement") and to provide financial
incentives to further encourage him in the performance of his duties
thereunder by granting him an option to purchase shares of common stock,
$.01 par value, of the Company (the "Common Stock");
WHEREAS, the Employee wishes to acquire the right to purchase shares of
Common Stock.
NOW, THEREFORE, for good and valuable consideration, the parties
hereto, intending to be legally bound, hereby agrees as follows:
1. Grant of Option. Subject to the provisions of Section 2 hereof,
the Company hereby grants to the Employee effective as of the date hereof
the right, privilege and option to purchase on the terms and conditions
hereinafter set forth up to 62,500 shares of Common Stock at a purchase
price of $24.242 per share (the "Option") pursuant to the Company's 2001
Stock Option Plan (the "Plan"). The Option is intended to be an "Incentive
Stock Option" as defined in Section 422 of the Internal Revenue Code of
1986, as amended (the "Code"), subject to Section 422 of the Code, to the
extent permitted by the Code, and a nonstatutory option with respect to the
balance. In addition to the terms and conditions set forth in this Stock
Option Agreement, the Option is governed by and subject to the terms and
conditions of the Plan.
2. Time for Exercise of Option. Subject to the provisions of Section
3 and 7 hereof, the Option may be exercised by the Employee from time to
time, in whole or in part, beginning on March 22, 2008 and ending on March
22, 2011, or within such shorter period as is provided in Section 3 hereof.
3. Termination of Employment.
(a) If the Employee's employment by the Company is terminated by the
Company without cause, then, notwithstanding the provisions of Section 2 of
this Agreement, upon such termination of employment, the Option shall become
exercisable in full and the Employee may, for a period of 90 days following
such termination (but before expiration of the original exercise period),
exercise the Option in whole or in part.
(b) If the Employee's employment by the Company is terminated due to
death or incapacity (as this term is defined in Employee's Employment
Agreement) or by voluntary, not for cause reasons as allowed under the
Employment Agreement, then, notwithstanding Section 2 of this Agreement, the
Option shall be entirely vested and exercisable in full and Employee or his
legal representative may, for a period of two years following such
termination (but before expiration of the original exercise period),
exercise the Option in whole or in part.
(c) If (i) the Employee's employment by the Company is terminated
voluntarily by the Employee and (ii) pursuant to Section 2 hereof the Option
has heretofore vested, the Employee may, for a period of 30 days after the
date of the termination (but before expiration of the original exercise
period), exercise the Option, in whole or in part.
(d) If the Employee's employment by the Company is terminated by the
Company for cause (as such term is defined in the Employment Agreement), the
Option shall terminate on the date on which the Employee's employment is
terminated, and the Employee shall have no further rights hereunder.
(e) The Employee acknowledges and understands that certain exercises
of the Option pursuant to this Section 3 may cause disqualification of the
Option as an Incentive Stock Option.
4. Method of Exercise. The Option may be exercised by written notice
(the "Notice") addressed and delivered to the Company (Attention: Chief
Executive Officer), specifying the number of shares of Common Stock to be
purchased and accompanied by (i) a check, or (ii) that number of shares of
Common Stock which have an aggregate fair market value as of the date of
exercise equal to the exercise price, or (iii) any combination thereof. For
purposes of this Agreement, "fair market value" of a share of Common Stock
shall mean: (i) if the Common Stock is traded on a national stock exchange
on the date of exercise of the Option, fair market value shall be the
closing price reported by the applicable composite transactions report on
such day, or if the Common Stock is not traded on such date, the mean
between the closing bid-and-asked prices thereof on that date on such
exchange; (ii) if the Common Stock is traded over-the counter and is
classified as a national market issue on the date of exercise of the Option,
fair market value shall be the last reported transaction price quoted by the
NASDAQ on that day; (iii) if the Common Stock is traded over-the-counter and
is not classified as a national market issue on the date of exercise of the
Option, fair market value shall be the mean between the last representative
bid-and-asked prices quoted by the NASDAQ on that day; or (iv) if none of
the foregoing provisions is applicable, fair market value as of the date of
exercise of the Option shall be determined by the Board of Directors in good
faith on such basis as it deems appropriate. In all cases, the
determination of fair market value shall be binding and conclusive on all
persons.
5. Delivery of Stock Certificates. The Option shall be deemed to
have been exercised upon receipt by the Company of the Notice accompanied by
the exercise price (the "Exercise Date"). The certificate representing the
shares of Common Stock purchased upon exercise of the Option shall be issued
as of the Exercise Date and delivered by the Company to the Employee free
and clear of all claims, liens and encumbrances, within five days following
the Exercise Date or as soon thereafter as practicable. As a condition to
the exercise of the Option, the Company may require the Employee to
represent and warrant at the time of any such exercise that the shares of
Common Stock are being purchased for investment purposes only, for the
account of the Employee and without any intention to distribute such shares.
If the shares of Common Stock issuable upon exercise of the Option have not
previously been registered under the Securities Act of 1933, as amended (the
"Securities Act") as contemplated by this Agreement, each certificate
evidencing shares of Common Stock acquired upon exercise of the Option shall
contain on its face, or on the reverse side thereof, the following legend:
"These shares have not been registered under the Securities
Act of 1933 or under any applicable state law They may not be
offered for sale, sold, transferred, or pledged without (1)
registration under the Securities Act of 1933 and any
applicable state law, or (2) an opinion (satisfactory to the
corporation) that registration is not required"
6. Adjustment Provisions. If, during the term of this Agreement,
there shall be any stock dividend, stock rights distribution, stock split,
recapitalization, merger, consolidation, sale of assets, reorganization or
other similar change or transaction of or by the Company, an appropriate
adjustment shall be made to the number and kind of shares remaining to be
acquired upon exercise of the Option and to the exercise price of the Option
so that the value to be received by the Employee upon exercise of the Option
shall, in the aggregate, be the same as if none of the foregoing
transactions had occurred.
7. Merger; Consolidation or Sale of Assets. In the event the Company
enters into an agreement providing for (i) the sale of all or substantially
all of the assets of the Company or (ii) a merger, consolidation or
reorganization which would result in the stockholders of the Company
immediately prior to such transaction owning less than 50% of the surviving
corporation, the Option shall become exercisable in full without regard to
any vesting limitations, and the Employee shall be entitled, commencing at
least ten days prior to the effective date of such transaction, to exercise
the Option in whole or in part, to the extent not previously exercised.
8. Withholding Obligations. In the event that the Company is
required to satisfy withholding obligations under the Code as a result of
the exercise of the Option, the Employee may request that, in lieu of
withholding amounts from the Employee's paycheck or requiring that the
Employee write a check to the Company in the amount of the withholding
obligation, the Company withhold that number of shares of Common Stock which
have a fair market value (determined in accordance with the provisions of
the Plan) on the Exercise Date equal to the amount required to be withheld.
9. Non-Transferability. The Option is not transferable or assignable
by the Employee other than by will or by the laws of descent and
distribution and are exercisable during the lifetime of the Employee only by
the Employee.
10. Compliance with Law. By accepting the Option, the Employee agrees
for himself and his legal representative that the Company shall not be
required to deliver any shares of Common Stock upon the exercise of the
Option until such shares have been qualified for delivery under applicable
securities laws and regulations as determined by the Company or its legal
counsel.
11. Rights as a Stockholder; Not an Employment Agreement. The
Employee shall have no rights as a stockholder of the Company with respect
to shares of Common Stock subject to the Option until the Option has been
exercised and payment made as herein provided and certificates representing
the shares as to which the Option has been exercised have been delivered to
the Employee. Nothing contained in this Agreement shall be construed to be a
contract of employment between the Company and the Employee.
12. Construction.
(a) Successors. This Agreement and all the terms and provisions hereof
shall be binding upon and shall inure to the benefit of the parties hereto
and their respective legal representatives, heirs and successors, except as
expressly herein otherwise provided.
(b) Entire Agreement Modification. This Agreement contains the entire
understanding between the parties with respect to the matters referred to
herein, and such agreement shall not be modified, except by written
instrument signed by the parties hereto.
(c) Headings; Pronouns; Governing Law. The descriptive headings of
the respective sections and subsections of this Agreement are inserted for
convenience of reference only and shall not be deemed to modify or construe
the provisions which follow them. Any use of any masculine pronoun shall
include the feminine and vice-versa, and any use of a singular, the plural
and vice-versa,, as the context and facts may require. The construction and
interpretation of this Agreement shall be governed in all respects by the
laws of the State of Delaware.
(d) Notices. All communications between the parties shall be in
writing and shall be deemed to have been duly given as of the date and time
of hand delivery or three days after mailing via certified or registered
mail, return receipt requested, proper postage prepaid following or such
other addresses of which the parties shall from time to time notify another:
If to the Company: Chief Executive Officer
First Health Group Corp.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxxx 00000
If to the Employee: Xx. Xxxxxxx XxXxxxxxx
First Health Group Corp.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxxx 00000
IN WITNESS WHEREOF, the parties have executed or caused to be executed
this Agreement as of the date first above written.
FIRST HEALTH GROUP CORP.
-------------------------------------
Xxxxxx X. Xxxxxxx
President and Chief Executive Officer
-------------------------------------
Xxxxxxx XxXxxxxxx
