X0202 4 2006-06-26 0 0000773660 HealthMarkets, Inc. N/A 0001182250 HAUPTMAN MARK D 9151 BOULEVARD 26 NORTH RICHLAND HILLS TX 76180 0 1 0 0 Vice President and CFO Stock Option 2006-06-26 4 D 0 8666 D 2007-05-08 2016-05-08 Class A-1 Common Stock 8666 0 D Stock Option 37.00 2006-06-26 4 D 0 8667 D 2007-05-08 2016-05-08 Class A-1 Common Stock 8667 0 D Stock Option 2006-06-26 4 A 0 8666 A 2007-06-26 2016-06-26 Class A-1 Common Stock 8666 8666 D Stock Option 37.00 2006-06-26 4 A 0 8667 A 2007-06-26 2016-06-26 Class A-1 Common Stock 8667 8667 D The initial exercise price of the option is $37.00. The exercise price of the option will accrete by 10% per year, starting on May 8, 2008. If the optionee exercises the option prior to May 8, 2008, the exercise price will be $37.00. If the optionee exercises the option on or after May 8, 2008 but prior to May 8, 2009, the exercise price will be $40.70. If the optionee exercises the option on or after May 8, 2009 but prior to May 8, 2010, the exercise price will be $44.77. If the optionee exercises the option on or after May 8, 2010 but prior to May 8, 2011, the exercise price will be $49.25. If the optionee exercises the option on or after May 8, 2011, the exercise price will be $54.17. The option vests in different increments on each of the first five anniversaries of May 8, 2006. Twenty-five percent of the option vests on May 8, 2007. Twenty-five percent of the option vests on May 8, 2008. Seventeen percent of the option vests on May 8, 2009. Seventeen percent of the option vests on May 8, 2010. The remaining 16% of the option vests on May 8, 2011. The reporting person agreed to the cancellation of an employee option granted to him on May 8, 2006 in exchange for a new employee option. The options vest in 20% increments on each of the first, second, third, fourth and fifth anniversaries of May 8, 2006 The initial exercise price of the option is $37.00. The exercise price of the option will accrete by 10% per year, starting on June 26, 2008. If the optionee exercises the option prior to June 26, 2008, the exercise price will be $37.00. If the optionee exercises the option on or after June 26, 2008 but prior to June 26, 2009, the exercise price will be $40.70. If the optionee exercises the option or or after June 26, 2009 but prior to June 26, 2010, the exercise price will be $44.77. If the optionee exercises the option on or after June 26, 2010 but prior to June 26, 2011, the exercise price will be $49.25. If the optionee exercises the option on or after June 26, 2011, the exercise price will be $54.17. The options vest in different increments on each of the first five anniversaries of June 26, 2006. Twenty-five percent of the option vests on June 26, 2007. Twenty-five percent of the option vests on June 26, 2008. Seventeen percent of the option vests on June 26, 2009. Seventeen percent of the option vests on June 26, 2010. The remaining 16% of the option vests on June 26, 2011. The options vest in 20% increments on each of the first, second, third, fourth and fifth anniversaries of June 26, 2006 Mark D. Hauptman by Peggy G. Simpson, POA 2006-06-28