This excerpt taken from the UNH 8-K filed Nov 8, 2006.
Hemsley Reaches New Agreement, Also Acts to Remove Any Unintended Personal Benefit of Past Option Grants to Him
Under the terms of the new, four-year employment agreement, Mr. Hemsley, as chief executive officer and president, will only be assured of receiving his base salary each year. The agreement does not set any minimum or target level for any bonus or other
incentive compensation for Mr. Hemsley. All bonus and incentive compensation is solely at the discretion of the Compensation Committee and ultimately the independent members of the Board of Directors. On May 1, 2006, the Company announced that Mr. Hemsley and certain other senior, long-tenured executives would not receive any additional equity awards.
In addition, as previously announced, Mr. Hemsley has agreed to have the exercise prices of all of his options with recorded grant dates between 1997, the year he commenced employment at the Company, and 2002, reset to the highest share price during the recorded grant year for each particular option. In the case of certain options described below, the exercise prices will be reset to the highest share price in 2000.
Further, Mr. Hemsley has acted to relinquish any personal benefit from option grants that were suspended in 1999 and reinstituted in August 2000. Mr. Hemsley said, My decision is in keeping with my personal goal of avoiding even the appearance of any unintended benefit from any past option grants to me.
Taken together, these actions reduce the current value of Mr. Hemsleys past equity compensation by approximately $190 million.