Exhibit 10.2

 

MAGELLAN HEALTH, INC.

 

2011 MANAGEMENT INCENTIVE PLAN

 

NOTICE OF STOCK OPTION GRANT

 

(REFERENCE NO. 2011-MARCH 4, 2015)

 

Name of Optionee:

 

[Employee Name]

 

 

 

Shares Subject to
Option:

 

         shares of Ordinary Common Stock of Magellan Health, Inc. (the “Shares”)

 

 

 

Type of Option:

 

x Nonqualified                       o Incentive

 

 

 

Exercise Price per
Share:

 

$            

 

 

 

Date of Grant:

 

March 4, 2015

 

 

 

Date Exercisable and Other Conditions of Exercise:

 

This option shall be exercisable, in whole or in part, until its Expiration
Date, only to the extent it is vested and while the Optionee’s Service with the
Company, a Subsidiary or a Parent company continues.  In addition, this option,
to the extent vested on the date of termination of the Optionee’s Service, shall
be exercisable for the period after the termination of the Optionee’s Service
provided by Optionee’s Option Agreement, unless a different period is specified
in Optionee’s employment agreement with the Company, a Subsidiary or a parent
company, in which case this option shall be exercisable for such different
period after termination of Optionee’s Service (but in no event on or after the
Expiration Date).

 

In addition, this option may be exercised, to the extent vested, only when
exercise is otherwise permitted in accordance with the terms of the 2011
Management Incentive Plan and the Option Agreement to which this notice of grant
relates (including the provisions thereof applicable in the event of Injurious
Conduct).

 

 

 

Vesting:

 

This option shall vest with respect to the Shares subject hereto as to one-third
of such Shares on each of the first, second and third anniversaries of the Date
of Grant, provided that in each case the Optionee’s Service has not terminated
prior to such date.

 

Notwithstanding the preceding paragraph, if the Optionee’s Service is terminated
for Retirement as defined under the Company’s Retirement Policy Applicable to
Employee Stock Options, this Option shall earlier vest immediately with respect
to 100% of the Shares subject hereto.

 

Notwithstanding the first paragraph of this section entitled “Vesting”, this
Option shall earlier vest immediately with respect to 100% of the Shares subject
hereto in the event, after the date hereof, a Change in Control of the Company
(as defined below) shall have occurred and within the period of eighteen months
(or such other period as is provided by Optionee’s employment agreement, if any,
in effect at the time of the Change of Control) following occurrence of the
Change in Control, Optionee’s Service with the Company shall be terminated by
the Company without Cause (as defined below) or by the Optionee with Good Reason
(as defined below), provided that the Optionee’s Service with the Company has
not

 

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previously terminated after the date hereof for any other reason, and upon such
accelerated vesting this Option shall continue to be exercisable for the same
period after such termination of Optionee’s Service as provided above. For
purposes of this Option, the terms “Change in Control,” “Cause” and “Good
Reason” shall have the same meanings as provided in any employment agreement
between the Company and Optionee in effect at the time of the Change in Control
(including any terms of substantially comparable significance in any such
employment agreement even if not of identical wording) or, if no such employment
agreement is in effect at such time or no such meanings are provided in such
employment agreement, shall have the meanings ascribed thereto below:

 

 

 

 

 

A “Change in Control” of the Company shall mean the first to occur after the
date hereof of any of the following events:

 

 

 

 

 

a.  any “person,” as such term is used in Sections 3(a)(9) and 13(d) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), becomes a
“beneficial owner,” as such term is used in Rule 13d-3 promulgated under the
Exchange Act, of 50% or more of the Voting Stock (as defined below) of the
Company;

 

 

 

 

 

b.  the majority of the Board of Directors of the Company consists of
individuals other than “Continuing Directors,” which shall mean the members of
the Board on the date hereof;

 

 

 

 

 

c.   the Board of Directors of the Company adopts and, if required by law or the
certificate of incorporation of the Corporation, the shareholders approve the
dissolution of the Company or a plan of liquidation or comparable plan providing
for the disposition of all or substantially all of the Company’s assets;

 

 

 

 

 

d.  all or substantially all of the assets of the Company are disposed of
pursuant to a merger, consolidation, share exchange, reorganization or other
transaction unless the shareholders of the Company immediately prior to such
merger, consolidation, share exchange, reorganization or other transaction
beneficially own, directly or indirectly, in substantially the same proportion
as they previously owned the Voting Stock or other ownership interests of the
Company, a majority of the Voting Stock or other ownership interests of the
entity or entities, if any, that succeed to the business of the Company; or

 

 

 

 

 

e.   the Company merges or combines with another company and, immediately after
the merger or combination, the shareholders of the Company immediately prior to
the merger or combination own, directly or indirectly, 50% or less of the Voting
Stock of the successor company, provided that in making such determination there
shall being excluded from the number of shares of Voting Stock held by such
shareholders, but not from the Voting Stock of the successor company, any shares
owned by Affiliates of such other company who were not also Affiliates of the
Company prior to such merger or combination.

 

 

 

 

 

“Cause” shall mean:

 

 

 

 

 

a.   Optionee is convicted of (or pleads guilty or nolo contendere to) a felony
or a crime involving moral turpitude;

 

 

 

 

 

b.   Optionee’s commission of an act of fraud or dishonesty involving his or her
duties on behalf of the Company;

 

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c.   Optionee’s willful failure or refusal to faithfully and diligently perform
duties lawfully assigned to Optionee as an officer or employee of the Company or
other willful breach of any material term of any employment agreement at the
time in effect between the Company and Optionee; or

 

 

 

 

 

d.   Optionee’s willful failure or refusal to abide by the Company’s policies,
rules, procedures or directives, including any material violation of the
Company’s Code of Ethics.

 

 

 

 

 

“Good Reason” shall mean:

 

 

 

 

 

a.     a reduction in Optionee’s salary in effect at the time of a Change in
Control, unless such reduction is comparable in degree to the reduction that
takes place for all other employees of the Company of comparable rank (for which
purpose any person who is an executive officer of the Company (as determined for
purposes of the Exchange Act shall be considered of comparable rank) or a
reduction in Optionee’s target bonus opportunity for the year in which or any
year after the year in which the Change of Control occurs from Optionee’s target
bonus opportunity for the year in which the Change in Control occurs (if any) as
established under any employment agreement Optionee has with the Company or any
bonus plan of the Company applicable to Optionee (or, if no such target bonus
opportunity has yet been established for Optionee under a bonus plan applicable
to Optionee for the year in which the Change of Control has occurred, the target
bonus opportunity so established for Optionee for the immediately preceding year
(if any)), For purposes of this provision, an action or actions of the Company
will be deemed “material” if, individually or in the aggregate, the action or
actions result(s) or potentially result(s) in a reduction in compensation in the
current year or a future year having a present value to Optionee of at least one
and one half percent (1.5%) of Optionee’s then current base salary, provided
that Optionee will have a legal right to claim damages for a breach of contract
for any action by the Company or event having an effect described under those
paragraphs that does not meet this objective materiality test, and actions may
be material in a given case at levels less than the specified level.;

 

 

 

 

 

b.     a material diminution in Optionee’s position, duties or responsibilities
as in effect at the time of a Change in Control or the assignment to Optionee of
duties which are materially inconsistent with such position, duties and
authority, unless in either case such change is made with the consent of the
Optionee; or

 

 

 

 

 

c.     the relocation by more than 50 miles of the offices of the Company which
constitute at the time of the Change in Control Optionee’s principal location
for the performance of his or her services to the Company;

 

 

 

 

 

d.     provided that, in each such case, Optionee provides notice to the Company
within 90 days that such event or condition constituting Good Reason has arisen,
and such event or condition continues uncured for a period of more than 30 days
after Optionee gives notice thereof to the Company, and Optionee terminates
Service within 18 months after such event or condition has arisen.

 

 

 

 

 

For purposes of the foregoing definitions, (A) “the Company” shall include any
entity that succeeds to all or substantially all of the business of the Company,
(B) “Affiliate” of a person or other entity shall mean a person or other entity
that directly or indirectly controls, is controlled by, or is under common
control with the person or other entity specified, and (C) “Voting Stock” shall
mean any capital stock of any class or classes having general voting power under
ordinary circumstances, in the absence of contingencies, to elect the directors
of

 

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a corporation and reference to a percentage of Voting Stock shall refer to such
percentage of the votes that all such Voting Stock is entitled to cast.

 

 

 

Other Terms (if any):

 

 

 

 

 

Expiration Date:

 

March 4, 2025

 

By signing your name below, you accept this award and acknowledge and agree that
this award is granted under and governed by the terms and conditions of the
Magellan Health, Inc. 2011 Management Incentive Plan and the related Stock
Option Agreement, reference number 2011-March 4, 2015, both of which are hereby
made a part of this document.

 

 

MAGELLAN HEALTH, INC.

 

 

 

 

 

By:

 

 

Name:

 

Title:

 

OPTIONEE:

 

 

 

 

 

Name:

 

 

 

 

 

Date:

 

 

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