EXHIBIT 4.7
OXFORD HEALTH PLANS, INC.
1991 STOCK OPTION PLAN,
AS AMENDED THROUGH MAY 11, 2000
I. ESTABLISHMENT OF PLAN; DEFINITIONS
1. Purpose. The purpose of the Oxford Health Plans, Inc. 1991 Stock Option Plan
is to provide an incentive to key Employees, Directors and Consultants of Oxford
Health Plans, Inc. (the "Corporation"), who are in a position to contribute
materially to the long-term success of the Corporation, to increase their
interest in the Corporation's welfare, and to aid in attracting and retaining
Employees, Directors and Consultants of outstanding ability.
2. Definitions. Unless the context clearly indicates otherwise, the following
terms shall have the meanings set forth below:
(a) "Board" shall mean the Board of Directors of the Corporation.
(b) "Change in Control" shall mean the occurrence of any of the
following events:
Any "person" (as defined below) is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Securities Exchange
Act of 1934), directly or indirectly, of securities of the
Corporation representing 30% or more of the total voting power
represented by the Corporation's then outstanding voting
securities; or
A change in the composition of the Board occurs, as a result
of which fewer than two-thirds of the incumbent directors are
directors who either (i) had been directors of the Corporation
on the "look-back date" (as defined below) or (ii) were
elected, or nominated for election, to the Board with the
affirmative votes of at least a majority of the directors who
had been directors of the Corporation on the "look-back date"
and who were still in office at the time of the election or
nomination; or
The stockholders of the Corporation approve a merger or
consolidation of the Corporation with any other corporation,
other than a merger or consolidation which would result in the
voting securities of the Corporation outstanding immediately
prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of
the surviving entity) at
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least 80% of the total voting power represented by the voting
securities of the Corporation or such surviving entity
outstanding immediately after such merger or consolidation; or
The stockholders of the Corporation approve (i) a plan of
complete liquidation of the Corporation or (ii) an agreement
for the sale or disposition by the Corporation of all or
substantially all of the Corporation's assets.
For purposes of this Subsection (b), the term "person" shall
have the same meaning as when used in sections 13(d) and 14(d)
of the Securities Exchange Act of 1934, but shall exclude (i)
a trustee or other fiduciary holding securities under an
employee benefit plan of the Corporation or of a parent or
subsidiary of the Corporation, and (ii) a corporation owned
directly or indirectly by the stockholders of the Corporation
in substantially the same proportions as their ownership of
the common stock of the Corporation.
For purposes of this Subsection (b), the term "look-back date"
shall mean the date 24 months prior to the change in the
composition of the Board.
Any other provision of this Section 2(b) notwithstanding, the
term "Change in Control" shall not include either of the
following events, if undertaken at the election of the
Corporation:
(i) A transaction, the sole purpose of which is
to change the state of the Corporation's
incorporation; or
(ii) A transaction, the result of which is to
sell all or substantially all of the assets
of the Corporation to another corporation
(the "surviving corporation"); provided that
the surviving corporation is owned directly
or indirectly by the stockholders of the
Corporation immediately following such
transaction in substantially the same
proportions as their ownership of the
Corporation's common stock immediately
preceding such transaction; and provided,
further, that the surviving corporation
expressly assumes this Plan and all
outstanding Stock Options.
(c) "Code" shall mean the Internal Revenue Code of 1986, as it may
be amended from time to time.
(d) "Committee" shall mean a committee whose members shall, from
time to time, be appointed by the Board; provided, however,
that on such date as the Corporation's Stock is first
registered under Section 12 of the Securities Exchange Act of
1934 such committee shall consist of at lease two Directors,
all of whom are non-employees within the meaning of Rule 16b-3
under the Securities Exchange Act of 1934.
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(e) "Consultant" shall mean any person retained by the Corporation
or any of its subsidiaries to render services on a consulting
basis.
(f) "Corporation" shall mean Oxford Health Plans, Inc., a Delaware
corporation, and any successor thereto.
(g) "Directors" shall mean those members of the Board of Directors
of the Corporation who are not Employees.
(h) "Disability" shall mean a medically determinable physical or
mental condition which causes an Employee, Director or
Consultant to be unable to engage in any substantial gainful
activity and which can be expected to result in death or to be
of long-continued and indefinite duration.
(i) "Employee" shall mean any common law employee, including
officers, of the Corporation or any of its subsidiaries as
determined in the Code and the Treasury Regulations
thereunder.
(j) "Fair Market Value" shall mean the fair market value of the
Stock as determined by the Committee on the basis of a review
of the facts and circumstances at the time.
(k) "Grantee" shall mean an Employee, Director or Consultant
granted a Stock Option under this Plan.
(l) "Incentive Stock Option" shall mean an option granted pursuant
to the Incentive Stock Option provisions as set forth in Part
II of this Plan.
(m) "Non-Qualified Stock Option" shall mean an option granted
pursuant to the Non-Qualified Stock Option provisions as set
forth in Part III of this Plan.
(n) "Plan" shall mean the Oxford Health Plans, Inc. 1991 Stock
Option Plan as set forth herein and as amended from time to
time.
(o) "Stock" shall mean authorized but unissued shares of the
Common Stock of the Corporation or reacquired shares of the
Corporation's Common Stock.
(p) "Stock Option" shall mean an option granted pursuant to the
Plan to purchase shares of Stock.
(q) "Ten Percent Stockholder" shall mean an Employee, who at the
time a Stock Option is granted owns stock possessing more than
ten percent (10%) of the total combined voting power of all
Stock of the Corporation or of its parent or subsidiary
corporation.
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3. Shares of Stock Subject to the Plan. Subject to the provisions of Paragraph 2
of Part IV, the number of shares of Stock which may be issued or transferred
pursuant to Stock Options granted under the Plan shall not exceed 30,580,000
shares in the aggregate. If a Stock Option shall expire and terminate for any
reason, in whole or in part, without being exercised, the number of shares of
Stock as to which such expired or terminated Stock Option shall not have been
exercised may again become available for the grant of Stock Options. There shall
be no terms and conditions in a Stock Option which provide that the exercise of
an Incentive Stock Option reduces the number of shares of Stock for which an
outstanding Non-Qualified Stock Option may be exercised; and there shall be no
terms and conditions in a Stock Option which provide that the exercise of a
Non-Qualified Stock Option reduces the number of shares of Stock for which an
outstanding Incentive Stock Option may be exercised.
4. Administration of the Plan. The Plan shall be administered by the Committee.
Subject to the express provisions of the Plan, the Committee shall have
authority to interpret the Plan, to prescribe, amend, and rescind rules and
regulations relating to it, to determine the terms and provisions of Stock
Option agreements, and to make all other determinations necessary or advisable
for the administration of the Plan. Any controversy or claim arising out of or
related to this Plan shall be determined unilaterally by and at the sole
discretion of the Committee.
5. Amendment or Termination. The Board may, at any time, alter, amend, suspend,
discontinue, or terminate this Plan; provided, however, that such action shall
not adversely affect the right of Grantees to Stock Options previously granted
and no amendment, without the approval of the stockholders of the Corporation,
shall increase the maximum number of shares which may be awarded under the Plan
in the aggregate, materially increase the benefits accruing to Grantees under
the Plan, change the class of Employees eligible to receive options under the
Plan, or materially modify the eligibility requirements for participation in the
Plan.
6. Effective Date and Duration of the Plan. The Plan shall become effective upon
its approval by the Board subject to its subsequent approval by the stockholders
of the Corporation. This Plan shall terminate fifteen years from the date the
Plan becomes effective, and no Stock Option may be granted under the Plan
thereafter, but such termination shall not affect any Stock Option theretofore
granted.
7. Limitation on Grants. Subject to the provisions of Paragraph 2 of Part IV, no
individual optionee may be granted Stock Options to purchase more than 2,000,000
shares of Stock in any calendar year.
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II. INCENTIVE STOCK OPTION PROVISIONS
1. Granting of Incentive Stock Options.
(a) Only key Employees of the Corporation shall be eligible to
receive Incentive Stock Options under the Plan. Directors of
the Corporation who are not also Employees shall not be
eligible for Incentive Stock Options.
(b) The purchase price of each share of Stock subject to an
Incentive Stock Option shall not be less than 100% of the Fair
Market Value of a share of the Stock on the date the Incentive
Stock Option is granted; provided, however, that (i) the
purchase price of each share of Stock subject to an Incentive
Stock Option granted to a Ten Percent Stockholder shall not be
less than 110% of the Fair Market Value of a share of the
Stock on the date the Incentive Stock Option is granted and
(ii) in the event an Incentive Stock Option is subject to
stockholder approval, the date of grant of such Incentive
Stock Option for purposes of the Plan shall be the date of
such stockholder approval.
(c) No Incentive Stock Option shall be exercisable more than seven
years from the date the Incentive Stock Option was granted;
provided, however, that an Incentive Stock Option granted to a
Ten Percent Stockholder shall not be exercisable more than
five years from the date the Incentive Stock Option was
granted.
(d) The Committee shall determine and designate from time to time
those Employees who are to be granted Incentive Stock Options
and specify the number of shares subject to each Incentive
Stock Option.
(e) Notwithstanding any other provisions hereof, the aggregate
Fair Market Value (determined at the time the option is
granted) of the Stock with respect to which Incentive Stock
Options are exercisable for the first time by the Employee
during any calendar year (under all such plans of the
Grantee's employer corporation and its parent and subsidiary
corporations) shall not exceed $100,000.
(f) The Committee, in its sole discretion, shall determine whether
any particular Incentive Stock Option shall become exercisable
in one or more installments, specify the installment dates and
determine the total period during which the Incentive Stock
Option is exercisable. The Committee may make provision for
accelerated exercisability of Incentive Stock Options in the
event of the Optionee's death, disability or retirement or
other events. Further, the Committee may make such other
provisions as may appear generally acceptable or desirable to
the Committee or necessary to qualify its grants under the
provisions of Section 422 of the Code.
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(g) The Committee may grant at any time new Incentive Stock
Options to an Employee who has previously received Incentive
Stock Options or other options whether such prior Incentive
Stock Options or other options are still outstanding, have
previously been exercised in whole or in part, or are
cancelled in connection with the issuance of new Incentive
Stock Options. The purchase price of the new Incentive Stock
Options may be established by the Committee without regard to
the existing Incentive Stock Options or other options.
(h) The Committee may determine, at the time of granting an
Incentive Stock Option or thereafter, that such Incentive
Stock Option shall become fully exercisable as to all Stock
subject to such Incentive Stock Option in the event that a
Change of Control occurs with respect to the Corporation. If
the Committee finds that there is a reasonable possibility
that, within the succeeding six months, a Change in Control
will occur with respect to the Corporation, then the Committee
at its sole discretion may determine that any or all
outstanding Incentive Stock Options shall become fully
exercisable as to all Stock subject to such Incentive Stock
Options.
2. Exercise of Incentive Stock Options.
(a) Except as otherwise provided by the Committee, the option
price of an Incentive Stock Option shall be payable on
exercise of the option (i) in cash or by check, bank draft or
postal or express money order, (ii) by the surrender of Stock
then owned by the Grantee, provided that the stock surrendered
by the Grantee has been owned by the Grantee for at least six
(6) months, or (iii) partially in accordance with clause (i)
and partially in accordance with clause (ii) of this
Paragraph. In no event shall payment of the exercise price of
an Incentive Stock Option be made by a promissory note or a
loan by the Corporation. Shares of Stock so surrendered in
accordance with clause (ii) or (iii) shall be valued at the
Fair Market Value thereof on the date of exercise, surrender
of such Stock to be evidenced by delivery of the
certificate(s) representing such shares in such manner, and
endorsed in such form, or accompanied by stock powers endorsed
in such form, as the Committee may determine.
3. Termination of Employment.
(a) Except as otherwise provided by the Committee, if a Grantee's
employment is terminated (other than by Disability or death)
the term of any then outstanding Incentive Stock Option held
by the Grantee shall extend for a period ending on the earlier
of the date on which such option would otherwise expire or
three months after such termination of employment, and such
option shall be exercisable to the extent it was exercisable
as of the date of termination of employment.
(b) If a Grantee's employment is terminated by reason of
Disability, the term of any then outstanding Incentive Stock
Option held by the Grantee shall extend for a period ending on
the earlier of the date on which such option would otherwise
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expire or three months after the Grantee's last date of
employment, and such option shall be exercisable to the extent
it was exercisable as of such last date of employment.
(c) If a Grantee's employment is terminated by death, the
representative of his estate or beneficiaries thereof to whom
the option has been transferred shall have the right during
the three-month period following his death to exercise any
then outstanding Incentive Stock Options in whole or in part.
If a Grantee dies within three-months after his retirement
without having fully exercised any then outstanding Incentive
Stock Options, the representative of his estate or
beneficiaries thereof to whom the option has been transferred
shall have the right during such three-month period to
exercise such options in whole or in part. The number of
shares of Stock in respect of which an Incentive Stock Option
may be exercised after a Grantee's death shall be the number
of shares in respect of which such option could be exercised
as of the date of the Grantee's death or retirement, whichever
occurs first. In no event may the period for exercising an
Incentive Stock Option extend beyond the date on which such
option would otherwise expire.
(d) The Board may grant a leave of absence to any Grantee for
purposes of continuing such Grantee's employment with the
Corporation or its subsidiaries.
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III. NON-QUALIFIED STOCK OPTION PROVISIONS
1. Granting of Stock Options.
(a) Key Employees and Consultants of the Corporation shall be
eligible to receive Non-Qualified Stock Options under the
Plan. Directors of the Corporation, excluding members of the
Committee, who are not also Employees shall also be eligible
to receive Non-Qualified Stock Options.
(b) The Committee shall determine and designate from time to time
those Employees, Directors and Consultants who are to be
granted Non-Qualified Stock Options and the amount subject to
each Non-Qualified Stock Option.
(c) The Committee may grant at any time new Non-Qualified Stock
Options to an Employee, Director or Consultant who has
previously received Non-Qualified Stock Options or other
options, whether such prior Non-Qualified Stock Options or
other options are still outstanding, have previously been
exercised in whole or in part, or are canceled in connection
with the issuance of new Non-Qualified Stock Options.
(d) When granting a Non-Qualified Stock Option, the Committee
shall determine the purchase price of the Stock subject
thereto. Such price shall not be less than 100% of the Fair
Market Value of such Stock on the date the Non-Qualified Stock
Option is granted; provided, however, that in the event a
Non-Qualified Stock Option is subject to stockholder approval,
the date of grant of such Non-Qualified Stock Option for
purposes of the Plan shall be the date of such stockholder
approval.
(e) The Committee, in its sole discretion, shall determine whether
any particular Non-Qualified Stock Option shall become
exercisable in one or more installments, specify the
installment dates and determine the total period during which
the Non-Qualified Stock Option is exercisable. The Committee
may make provision for accelerated exercisability of
Non-Qualified Stock Options in the event of the Optionee's
death, disability or retirement or other events. Further, the
Committee may make such other provisions as may appear
generally acceptable or desirable to the Committee.
(f) No Non-Qualified Stock Option shall be exercisable more than
seven years from the date such option is granted.
(g) The Committee may determine, at the time of granting a
Non-Qualified Stock Option or thereafter, that such
Non-Qualified Stock Option shall become fully exercisable as
to all Stock subject to such Non-Qualified Stock Option in the
event that a Change of Control occurs with respect to the
Corporation. If the Committee finds that there is a reasonable
possibility that, within the succeeding six months, a Change
in Control will occur with respect to the Corporation, then
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the Committee at its sole discretion may determine that any or
all outstanding Non-Qualified Stock Options shall become fully
exercisable as to all Stock subject to such Non-Qualified
Stock Options.
2. Exercise of Stock Options. The option price of a Non-Qualified Stock Option
shall be payable on exercise of the option (i) in cash or by check, bank draft
or postal or express money order, (ii) by the surrender of Stock then owned by
the Grantee, provided that the stock surrendered by the Grantee has been owned
by the Grantee for at least six (6) months, or (iii) partially in accordance
with clause (i) and partially in accordance with clause (ii) of this Paragraph.
In no event shall payment of the exercise price of a Non-Qualified Stock Option
be made by a promissory note or a loan by the Corporation. Shares of Stock so
surrendered in accordance with clause (ii) or (iii) shall be valued at the Fair
Market Value thereof on the date of exercise, surrender of such to be evidenced
by delivery of the certificate(s) representing such shares in such manner, and
endorsed in such form, or accompanied by stock powers endorsed in such form, as
the Committee may determine.
3. Termination of Employment.
(a) Except as otherwise provided by the Committee, if a Grantee's
employment is terminated, a Director Grantee ceases to be a
Director or a Consultant Grantee ceases to be a Consultant
(other than by Disability or death), the term of any then
outstanding Non-Qualified Stock Option held by the Grantee
shall extend for a period ending on the earlier of the date on
which such option would otherwise expire or three months after
such termination of employment or cessation of being a
Director or a Consultant, and such option shall be exercisable
to the extent it was exercisable as of the date of termination
of employment or cessation of being a Director or a
Consultant.
(b) If a Grantee's employment is terminated by reason of
Disability, a Director Grantee ceases to be a Director by
reason of Disability or a Consultant Grantee ceases to be a
Consultant by reason of Disability, the term of any then
outstanding Non-Qualified Stock Option held by the Grantee
shall extend for a period ending on the earlier of the date on
which such option would otherwise expire or three months after
the Grantee's last date of employment or being a Director or
Consultant, and such option shall be exercisable to the extent
it was exercisable as of such last date of employment or
cessation of being a Director or Consultant.
(c) If a Grantee's employment is terminated by death or a Director
Grantee ceases to be a Director or Consultant by reason of
death, the representative of his estate or beneficiaries
thereof to whom the option has been transferred shall have the
right during the three-month period following his death to
exercise any then outstanding Non-Qualified Stock Options in
whole or in part. If a Grantee dies within three-months after
his retirement without having fully exercised any then
outstanding Non-Qualified Stock Options, the representative of
his estate or beneficiaries thereof to whom the option has
been transferred shall have the right during such three month
period to exercise such options in whole or in part. The
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number of shares of Stock in respect of which a Non-Qualified
Stock Option may be exercised after a Grantee's death shall be
the number of shares of Stock in respect of which such option
could be exercised as of the date of the Grantee's death or
retirement, whichever first occurs. In no event may the period
for exercising a Non-Qualified Stock Option extend beyond the
date on which such option would otherwise expire.
(d) The Board may grant a leave of absence to any Grantee for
purposes of continuing such Grantee's employment with the
Corporation or its subsidiaries.
IV. GENERAL PROVISIONS
1. Substitution of Options. In the event of a corporate merger or consolidation,
or the acquisition by the Corporation of property or stock of an acquired
corporation or any reorganization or other transaction qualifying under Section
425 of the Code, the Committee may, in accordance with the provisions of that
Section, substitute options under this Plan for options under the plan of the
acquired corporation provided (i) the excess of the aggregate fair market value
of the shares subject to option immediately after the substitution over the
aggregate option price of such shares is not more than the similar excess
immediately before such substitution and (ii) the new option does not give the
Employee additional benefits, including any extension of the exercise period.
2. Adjustment Provisions.
(a) If the shares of Stock outstanding are changed in number or
class by reason of a split-up, merger, consolidation,
reorganization, reclassification, recapitalization, or any
capital adjustment, including a stock dividend, or if any
distribution is made to the holders of common stock other than
a cash dividend, then
(i) the aggregate number and class of shares or
other securities that may be issued or
transferred pursuant to Paragraph 3 and
pursuant to Paragraph 7 of Part I,
(ii) the number and class of shares or other
securities which are issuable under
outstanding Stock Options, and
(iii) the purchase price to be paid per share
under outstanding Stock Options
shall be adjusted as provided hereinafter.
(b) Adjustment under this Paragraph 2 shall be made in an
equitable manner by the Committee, whose determination as to
what adjustments shall be made, and the extent thereof, shall
be final, binding, and conclusive.
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3. General.
(a) Each Stock Option shall be evidenced by a written instrument
containing such terms and conditions, not inconsistent with
this Plan, as the Committee shall approve.
(b) The granting of a Stock Option in any year shall not give the
Grantee any right to similar grants in future years or any
right to be retained in the employ of the Corporation, and all
Employees shall remain subject to discharge to the same extent
as if the Plan were not in effect.
(c) No Employee, and no beneficiary or other person claiming under
or through him, shall have any right, title or interest by
reason of any Stock Option to any particular assets of the
Corporation, or any shares of Stock allocated or reserved for
the purposes of the Plan or subject to any Stock Option except
as set forth herein. The Corporation shall not be required to
establish any fund or make any other segregation of assets to
assure the payment of any Stock Option.
(d) No right under the Plan shall be subject to anticipation,
sale, assignment, pledge, encumbrance, or charge except by
will or the law of descent and distribution, and a Stock
Option shall be exercisable during the Grantee's lifetime only
by the Grantee.
(e) Notwithstanding any other provision of this Plan or agreements
made pursuant thereto, the Corporation's obligation to issue
or deliver any certificate or certificates for shares of Stock
under a Stock Option, and the transferability of Stock
acquired by exercise of a Stock Option, shall be subject to
all of the following conditions:
(i) Any registration or other qualification of
such shares under any state or federal law
or regulation, or the maintaining in effect
of any such registration or other
qualification which the Board shall, in its
absolute discretion upon the advice of
counsel, deem necessary or advisable;
(ii) The obtaining of any other consent,
approval, or permit from any state or
federal governmental agency which the Board
shall, in its absolute discretion upon the
advice of counsel, determine to be necessary
or advisable; and
(iii) Each stock certificate issued pursuant to a
Stock Option shall bear the following
legend:
"The transferability of this certificate and the shares of
Stock represented hereby are subject to restrictions, terms
and conditions contained in the Oxford Health Plans, Inc. 1991
Stock Option Plan, and an Agreement between the registered
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owner of such Stock and Oxford Health Plans, Inc. A copy of
the Plan and Agreement are on file in the office of the
Secretary of Oxford Health Plans, Inc."
(f) All payments to Grantees or to their legal representatives
shall be subject to any applicable tax, community property, or
other statutes or regulations of the United States or of any
state having jurisdiction thereof. The Grantee may be required
to pay to the Corporation the amount of any withholding taxes
which the Corporation is required to withhold with respect to
a Stock Option or its exercise. In the event that such payment
is not made when due, the Corporation shall have the right to
deduct, to the extent permitted by law, from any payment of
any kind otherwise due to such person all or part of the
amount required to be withheld.
(g) In the case of a grant of a Stock Option to any Employee of a
subsidiary of the Corporation, the Corporation may, if the
Committee so directs, issue or transfer the shares, if any,
covered by the Stock Option to the subsidiary, for such lawful
consideration as the Committee may specify, upon the condition
or understanding that the subsidiary will transfer the shares
to the Employee in accordance with the terms of the provisions
of the Plan. For purposes of this Section, a subsidiary shall
mean any subsidiary corporation of the Corporation as defined
in Section 425 of the Code.
(h) A Grantee entitled to Stock as a result of the exercise of a
Stock Option shall not be deemed for any purpose to be, or
have rights as, a shareholder of the Corporation by virtue of
such exercise, except to the extent a stock certificate is
issued therefor and then only from the date such certificate
is issued. No adjustments shall be made for dividends or
distributions or other rights for which the record date is
prior to the date such stock certificate is issued. The
Corporation shall issue any stock certificates required to be
issued in connection with the exercise of a Stock Option with
reasonable promptness after such exercise.
(i) The grant or exercise of Stock Options granted under the Plan
shall be subject to, and shall in all respects comply with,
applicable Delaware corporate law relating to such grant or
exercise without regard to principles of conflicts of law.
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