This excerpt taken from the WBMD DEF 14A filed Nov 5, 2008.
Shares Available for Grant; Eligibility
Under the 2005 Plan, a total of approximately 2,400,000 shares were available for future grant, as of October 31, 2008. If Proposal 2 is approved by WebMDs stockholders, an additional 5,500,000 shares would become available for future grants under the 2005 Plan, a large portion of which would be used to make a broad-based grant in late 2008. The remaining portion of the increase, along with the shares currently available for grant under the 2005 Plan, would be used for future grants, primarily in connection with future new hires. The 2005 Plan is the only equity compensation of WebMD under which grants of stock-based awards may currently be made. However, the Compensation Committee has in the past (see Equity Compensation Plan Information Description of Subimo Plan below) and may in the future, to the extent permitted under applicable law and NASDAQ rules, create equity compensation plans for new hire grants that do not require stockholder approval, particularly in connection with acquisitions of other companies. The Compensation Committee has recently approved the creation of a long-term incentive plan for employees of Marketing Technology Solutions, Inc. (MTS), which would have a maximum of 700,000 shares available for awards and would otherwise be substantially similar to the Subimo Plan. Awards under the plan for MTS
employees would be made solely upon the closing of WebMDs pending acquisition of MTS and the plan would not be used to make any awards after that. WebMD does not intend to seek stockholder approval for that plan.
Persons eligible to receive awards under the 2005 Plan are employees or officers (including executive officers) of WebMD or its subsidiaries and its parent or its parents other subsidiaries, directors of WebMD, and certain consultants to WebMD or any of its subsidiaries. As of October 24, 2008, approximately 1,350 officers and employees of WebMD and its subsidiaries (including all of its executive officers), as well as each of its 6 non-employee directors, are eligible to receive grants under the 2005 Plan. As of October 24, 2008, approximately 600 officers and employees of HLTH and its subsidiaries (other than WebMD and its subsidiaries) are eligible to receive grants under the 2005 Plan (of which approximately 65 are employees of HLTH and the remainder are employees of Porex). However, only three employees of HLTH who are not officers or employees of WebMD have received a grant under the 2005 Plan. WebMD does not generally make grants under the 2005 Plan to employees of HLTH who are not also officers of WebMD, but may do so, from time to time, for HLTH employees who provide significant services to WebMD.
Prior to its initial public offering, WebMDs officers (including its Named Executive Officers) received grants of HLTH restricted stock and options to purchase shares of HLTH Common Stock under HLTHs equity compensation plans and they continue to be eligible to receive awards under those plans. However, the HLTH Compensation Committee does not, in general, intend to make grants to WebMD employees under HLTH equity compensation plans and has not done so since WebMDs initial public offering. So long as WebMD remains a subsidiary of HLTH for purposes of the applicable HLTH equity compensation plan, HLTH restricted stock and options to purchase HLTH Common Stock held by WebMD officers and employees will generally continue to vest and remain outstanding during the period that the officer or employee remains in the employ of WebMD (subject to the terms and conditions of the applicable HLTH equity compensation plans and of agreements applicable to specific grants). HLTHs equity compensation plans are administered by HLTHs Compensation Committee and contain terms and conditions that are substantially similar to the terms of WebMDs 2005 Plan.
As more fully described in Non-Employee Director Compensation above, WebMDs non-employee directors receive automatic annual grants of options to purchase 13,200 shares on January 1 of each year, with an exercise price equal to the closing price of WebMDs Common Stock on the last trading day of the prior year. WebMDs Compensation Committee may make additional grants under the 2005 Plan to WebMDs non-employee directors, including grants when non-employee directors first join WebMDs board. As of the date of this proxy statement, WebMD has no current plans or proposals to make any such additional grants of awards under the 2005 Plan to its non-employee directors.