Exhibit 10(b)
HUMANA INC.
INCENTIVE STOCK OPTION
AGREEMENT
UNDER THE AMENDED AND RESTATED
2003 STOCK INCENTIVE PLAN
THIS STOCK OPTION
AGREEMENT (
“Agreement” ) made as of
by and between HUMANA INC. , a corporation duly organized
and existing under the laws of the State of Delaware (hereinafter
referred to as the “Company” ), and
,
an employee of the Company (hereinafter referred to as
“Optionee” ).
WITNESSETH:
WHEREAS, the Amended and Restated 2003 Stock Incentive
Plan (the “Plan” ), for certain employees and
non-employee Directors of the Company and its subsidiaries was
approved by the Company’s Board of Directors (the
“Board” ) and stockholders; and
WHEREAS, the Company desires to grant to Optionee an
option to purchase shares of common stock of the Company in
accordance with the Plan.
NOW, THEREFORE,
in consideration of the premises,
mutual covenants hereinafter set forth, and other good and valuable
consideration, the Company and Optionee agree as
follows:
1. The Company hereby grants to
Optionee, as a matter of separate inducement and agreement and not
in lieu of salary or other compensation for services, an Incentive
Stock Option to purchase
shares of the $.16 2 / 3
par value common stock of the
Company (“Common Stock”) at the purchase price of $
per share (the “Option”) exercisable on the terms and
conditions set forth herein.
2. The term of the Option shall
commence upon the date of grant,
,
and shall expire on
(“Expiration Date”).
3. Except as otherwise set forth
herein, this Option shall be exercisable in full by Optionee or
his/her personal representative on and after the first anniversary
of the date hereof in cumulative annual installments of one-third
of the number of shares covered hereby.
4. A. If the employment of Optionee
by the Company is terminated for Cause, all the rights of Optionee
under this Agreement, whether or not exercisable, shall terminate
immediately.
B. If the employment of Optionee is
terminated for any reason other than for Cause, Retirement, death
or Disability, unless otherwise specified herein, all the rights of
Optionee under this Agreement then exercisable shall remain
exercisable at any time within ninety (90) days after the date
of such termination, but in no event beyond the Expiration
Date.
C. In the event of Optionee’s
Retirement, (i) to the extent that this Option (or portion
hereof) is exercisable as of the date of such Retirement, this
Option (or portion hereof) shall be exercisable at any time within
two (2) years after the date of Retirement, but in no event
beyond the Expiration Date, and only to the extent the Option (or
portion hereof) was exercisable at the date of Retirement, and
(ii) to the extent that this Option (or portion hereof) is not
exercisable as of
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the date of such Retirement, this Option (or
portion hereof) shall continue to vest and become exercisable as if
the Optionee were continuing to provide services to the Company or
a Subsidiary, as applicable, and this Option (or portion hereof)
shall be exercisable at any time within two (2) years
following the date on which this Option (or portion hereof) becomes
vested and exercisable.
D. In the event of death or
Disability of Optionee while in the employ of the Company, this
Option shall become immediately exercisable and shall remain
exercisable by Optionee or the person or the persons to whom those
rights pass by will or by the laws of descent and distribution or,
if appropriate, by the legal representative of the Optionee or the
estate of the Optionee at any time within two (2) years after
the date of such death or Disability.
5. A. This Option shall be
exercisable only by written notice to the Secretary of the Company
at the Company’s principal executive offices by Optionee or
his/her legal representative as herein provided. Such notice shall
state the number of shares to be exercised and shall be signed by
Optionee or his/her legal representative, as applicable.
B. The purchase price shall be paid
as follows:
i) In full in cash upon the exercise
of the Option; or
ii) By tendering to the Company
shares of the Common Stock of Company owned by him/her prior to the
date of exercise and having an aggregate fair market value equal to
the cash exercise price applicable to his/her Option; or
iii) A combination of 5(B)(i) and
5(B)(ii) above.
C. Federal, state and local income
taxes and other amounts as may be required by law to be collected
by the Company in connection with the exercise of this Option shall
be paid pursuant to the Plan by Optionee prior to the delivery of
any Common Stock under this Agreement.
6. The Option granted under this
Agreement to Optionee may
