Exhibit 10.1
    

    
      Form of Exchange Agreement
    

    
      August 11, 2014
    

    

    

    
      Molina Healthcare, Inc.
200 Oceangate, Suite 100
Long Beach, CA
      90802-4317
Attn: John C. Molina
    

    

    


    	
           
        	
          
            Re:
          

        	
          
            Molina Healthcare, Inc. Exchange of 3.75% Convertible Senior
            Notes
          

        
	

        	

        	
          
            due 2014 (CUSIP 60855R AA8)
          

        


    

    

    

    
      Ladies and Gentlemen:
    

    
      The undersigned beneficial owner of Molina Healthcare, Inc.’s (the “Company”)
      3.75% Convertible Senior Notes due 2014, CUSIP 60855R AA8 (the “Old
      Notes”) hereby agrees with the Company to exchange the Old Notes for
      1.625% Convertible Senior Notes due 2044 (the “2044 Notes”),
      shares of the Company’s Common Stock, par value $0.001 per share (the “Exchange
      Shares”) and the Applicable Interest Amount (as defined below),
      pursuant to the terms and conditions of this Exchange Agreement.  The
      undersigned understands that this exchange (the “Exchange”)
      is being made without registration of the 2044 Notes or the Exchange
      Shares under the Securities Act of 1933, as amended (the “Securities
      Act”), or any securities laws of any state of the United States or
      of any other jurisdiction, and is being made only to beneficial owners
      of Old Notes who are both “accredited investors” (as defined in Rule 501
      of Regulation D under the Securities Act) and “qualified institutional
      buyers” (as defined in Rule 144A under the Securities Act) in reliance
      on a private placement exemption from registration under the Securities
      Act.  The Exchange is described in and made pursuant to the Preliminary
      Private Placement Circular, dated on or about August 4, 2014, the
      Pricing Term Sheet, dated August 11, 2014 (collectively, the “Private
      Placement Documents”) and the Final Private Placement Circular, to
      be dated on or around August 28, 2014 (the “Final Private
      Placement Document”).  
    

    
      1.        Exchange Consideration.  Subject
      to the terms and conditions of this Exchange Agreement, the undersigned
      hereby agrees to exchange an aggregate principal amount of the Old Notes
      set forth on the signature page hereto for the consideration in the
      amount and form as follows (the “Consideration”):
    

    	
        An amount of cash in United States dollars equal to (i) the accrued
        and unpaid interest on such Old Notes up to, but excluding, the
        Closing Date plus (ii) the interest that would have accrued on
        such Old Notes from, and including, the Closing Date to, but
        excluding, October 1, 2014 had such Old Notes remained outstanding
        from the Closing Date to October 1, 2014 (such amounts payable
        pursuant to this bullet, the “Applicable Interest Amount”),
        which amount of cash equals [__] (or [__] per Old Note);
      
	
        2044 Notes: $1,000 principal amount of 2044 Notes per $1,000 principal
        amount of Old Notes; and
      


    
      
        

        

      

      
        
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        Exchange Shares: A number of Exchange Shares per $1,000 principal
        amount of Old Notes (with the aggregate number of Exchange Shares
        delivered to the undersigned in respect of all of its Old Notes
        validly submitted for exchange rounded down to the nearest whole
        Exchange Share) equal to the sum of the Daily Exchange Amounts for
        each of the 10 consecutive “VWAP Trading Days” (as defined in the
        indenture, dated as of October 11, 2007, as supplemented by the first
        supplemental indenture, dated as of October 11, 2007 (the “Old
        Notes Indenture”), between the Company and U.S. Bank
        National Association as trustee (the “Old Notes Trustee”))
        during the Exchange Valuation Period. 
      


    
      “Daily Exchange Amount” means, for each of the 10
      consecutive “VWAP Trading Days” (as defined in the Old Notes Indenture)
      during the Exchange Valuation Period, a number of shares of the
      Company’s common stock equal to (i) the amount in United States dollars
      equal to the excess, if any, of (x) 1/10th (one-tenth) of the product of
      the “Conversion Rate” (as defined in the Old Notes Indenture) and the
      “Daily VWAP” for such “VWAP Trading Day” (each as defined in the Old
      Notes Indenture) over (y) $100 divided by (ii) the “Daily
      VWAP” for such “VWAP Trading Day” (each as defined in the Old Notes
      Indenture). 
    

    
      “Exchange Valuation Period” means the 10 consecutive “VWAP
      Trading Days” (as defined in the Old Notes Indenture) beginning on, and
      including, August 19, 2014.  
    

    
      For the avoidance of doubt, the reference to “20 consecutive VWAP
      Trading Days during the Conversion Period” in the definition of “Daily
      VWAP” in the Old Notes Indenture will be disregarded for purposes of the
      foregoing calculation.
    

    
      The Exchange shall occur in accordance with the procedures described in
      Section 3 hereof.
    

    
      2.        The Closing.  The
      closing of the Exchange (the “Closing”) shall take place at
      the offices of Latham & Watkins LLP at 10:00 a.m. New York City time on
      the third business day immediately following the last “VWAP Trading Day”
      of the Exchange Valuation Period, expected to be September 5, 2014 (the “Closing
      Date”), or at such other time and place as the Company may designate
      by notice to the undersigned; provided that the Closing shall
      have occurred on or prior to the thirteenth business day immediately
      following the last “VWAP Trading Day” of the Exchange Valuation Period.
    

    
      3.        Exchange.  Subject
      to the terms and conditions of this Exchange Agreement, the undersigned
      hereby sells, assigns and transfers to, or upon the order of, the
      Company, all right, title and interest in such portion of the Old Notes
      as is indicated on the signature page hereto, waives any and all other
      rights with respect to such Old Notes, and releases and discharges the
      Company from any and all claims the undersigned may now have, or may
      have in the future, arising out of, or related to, such Old Notes,
      including, without limitation, any claims arising from any existing or
      past defaults, or any claims that the undersigned is entitled to receive
      additional interest with respect to the Old Notes (other than the right
      to receive any interest included in the Applicable Interest Amount).
    

    
      
        

        

      

      
        
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      The Depository Trust Company (“DTC”) will act as securities
      depository for the Exchange Shares and the 2044 Notes.  On or prior to
      12:00 p.m. New York City time on the business day immediately preceding
      the Closing Date, the undersigned agrees to direct the eligible DTC
      participant through which the undersigned holds a beneficial interest in
      the Old Notes to submit a one-sided withdrawal instruction through DTC’s
      Deposits and Withdrawal at Custodian (“DWAC”) program to
      the Old Notes Trustee, for the aggregate principal amount of the Old
      Notes to be exchanged pursuant to this Exchange Agreement (the “DWAC
      Withdrawal”).
    

    
      (i) On or prior to 9:00 a.m. New York City time on the Closing Date, the
      Company will submit, through the DWAC Online System of American Stock
      Transfer & Trust Company, LLC, acting as the Company’s Transfer Agent
      for its common stock (the “Transfer Agent”), a deposit
      instruction for the aggregate number of Exchange Shares (the “Exchange
      Shares DWAC Deposit”) and (ii) on or prior to 12:00 p.m. New York
      City time on the business day immediately preceding the Closing Date,
      the undersigned agrees to direct the eligible DTC participant through
      which the undersigned previously held a beneficial interest in the Old
      Notes (or any other DTC participant of its choosing) to submit a deposit
      instruction on the Closing Date prior to 12:00 p.m. New York City time
      on such date to U.S. Bank National Association (the “2044 Notes
      Trustee”), for the aggregate principal amount of 2044 Notes (the “2044
      Notes DWAC Deposit”), in each case, to be exchanged pursuant
      to this Exchange Agreement, or comply with such other settlement
      procedures mutually agreed in writing by the undersigned, the Company,
      the Old Notes Trustee, the 2044 Notes Trustee and the Transfer
      Agent.  The Exchange Shares and the 2044 Notes will not be delivered
      until a valid DWAC Withdrawal of the Old Notes has been received by the
      Old Notes Trustee.  In the event the Closing does not occur, any Old
      Notes submitted for DWAC Withdrawal will be returned to the DTC
      participant that submitted the withdrawal instruction in accordance with
      the procedures of DTC.
    

    
      On the Closing Date, subject to satisfaction of the conditions precedent
      specified in this Exchange Agreement and the prior receipt of the DWAC
      Withdrawal conforming with the aggregate principal amount of the Old
      Notes to be exchanged, the Company hereby agrees to (i) transfer by wire
      of immediately available funds to the account of the undersigned at a
      bank in the United States of America provided by the undersigned as Exhibit
      A to this Exchange Agreement all Applicable Interest Amounts on the
      Old Notes to be exchanged; (ii) issue the Exchange Shares, and direct
      the Transfer Agent to accept the Exchange Shares DWAC Deposit conforming
      with the aggregate number of Exchange Shares to be issued in the
      Exchange and deliver the Exchange Shares (or comply with such other
      settlement procedures mutually agreed in writing by the undersigned, the
      Company and the Transfer Agent); and (iii) execute the 2044 Notes, and
      direct the 2044 Notes Trustee to authenticate and, by acceptance of the
      2044 Notes DWAC Deposit, deliver, the 2044 Notes (or comply with such
      other settlement procedures mutually agreed in writing by the
      undersigned, the Company and the 2044 Notes Trustee), in each case to
      the DTC account specified on the signature page to this Exchange
      Agreement.  If (i) the 2044 Notes Trustee or Transfer Agent is unable to
      locate the DWAC Withdrawal, Exchange Shares DWAC Deposit or 2044 Notes
      DWAC Deposit or (ii) the DWAC Withdrawal, Exchange Shares DWAC Deposit
      or 2044 Notes DWAC Deposit does not conform with the Old Notes, the
      Exchange Shares or the 2044 Notes, respectively, to be exchanged
      pursuant to this Exchange Agreement, the Company will promptly notify
      the undersigned.
    

    
      
        

        

      

      
        
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      All questions as to the form of all documents and the validity and
      acceptance of the Old Notes, the Exchange Shares and the 2044 Notes will
      be determined by the Company, in its sole discretion, which
      determination shall be final and binding.
    

    
      All authority herein conferred or agreed to be conferred in this
      Exchange Agreement shall survive the dissolution of the undersigned and
      any representation, warranty, undertaking and obligation of the
      undersigned hereunder shall be binding upon the trustees in bankruptcy,
      legal representatives, successors and assigns of the undersigned.
    

    
      4.        Representations and
      Warranties of the Company. The Company represents and warrants to
      the undersigned that:
    

    
      (a)       The Company is duly formed and validly existing under the laws
      of the State of Delaware, with full power and authority to conduct its
      business as it is currently being conducted and to own its assets.
    

    
      (b)       The Exchange Shares, when issued, delivered and paid for in
      the manner set forth in this Exchange Agreement, will be validly issued,
      fully paid and non-assessable, and the issuance of such Exchange Shares
      will not be subject to any preemptive or similar rights.
    

    
      (c)       The 2044 Notes have been duly authorized and, when issued,
      authenticated and delivered in the manner provided for in the indenture
      to be dated as of the Closing Date between the Company and the 2044
      Notes Trustee (the “Indenture”) and in this Exchange
      Agreement, will be validly issued, will constitute valid and binding
      obligations of the Company, enforceable against the Company in
      accordance with their terms, except as enforceability may be limited by
      applicable bankruptcy, insolvency, fraudulent conveyance,
      reorganization, moratorium or similar laws affecting creditors’ rights
      generally or by equitable principles relating to enforceability,
      including principles of commercial reasonableness, good faith and fair
      dealing, regardless of whether enforcement is sought in a proceeding at
      law or in equity, and will be entitled to the benefits of the Indenture;
      and the 2044 Notes will conform to the description thereof set forth in
      the Private Placement Documents and the Final Private Placement Document
      in all material respects.
    

    
      (d)       The Indenture has been duly authorized by the Company and,
      when duly authorized, executed and delivered in accordance with its
      terms by the 2044 Notes Trustee, will constitute a valid and binding
      obligation of the Company, enforceable against the Company in accordance
      with its terms, except as enforceability may be limited by applicable
      bankruptcy, insolvency, fraudulent conveyance, reorganization,
      moratorium or similar laws affecting creditors’ rights generally or by
      equitable principles relating to enforceability, including principles of
      commercial reasonableness, good faith and fair dealing, regardless of
      whether enforcement is sought in a proceeding at law or in equity; and
      the Indenture will conform to the description thereof contained in the
      Private Placement Documents and the Final Private Placement Document in
      all material respects.
    

    
      (e)       Upon issuance and delivery of the 2044 Notes pursuant to the
      Indenture and this Exchange Agreement, the 2044 Notes will be
      convertible at the option of the holders thereof into shares of the
      Company’s common stock, par value $0.001 per share (the “Common
      Stock”), in accordance with the terms of the 2044 Notes.  The
      Company has reserved a sufficient number of shares of Common Stock for
      issuance upon conversion of the 2044 Notes and, when such shares of
      Common Stock are issued upon conversion of the 2044 Notes in accordance
      with the terms of the 2044 Notes and the Indenture, such shares will be
      validly issued, fully paid and non-assessable, and the issuance of such
      shares of Common Stock will not be subject to any preemptive or similar
      rights.
    

    
      
        

        

      

      
        
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      (f)       The issuance of the Exchange Shares and the 2044 Notes in
      book-entry form through DTC in exchange for the Old Notes pursuant to
      this Exchange Agreement is exempt from the registration requirements of
      the Securities Act and, assuming the undersigned is not, and during the
      past three months has not been, an affiliate of the Company, the
      Exchange Shares and the 2044 Notes to be delivered to the undersigned’s
      account pursuant to this Exchange Agreement will not be subject to
      restrictions on transfer under the Securities Act (and will not have any
      restrictive legends on such Exchange Shares or 2044 Notes).
    

    
      (g)       It is not necessary to qualify the Indenture under the Trust
      Indenture Act of 1939, as amended.
    

    
      5.        Representations and
      Warranties of the Undersigned.  The undersigned hereby represents
      and warrants to and covenants with the Company that:
    

    
      (a)       The undersigned has full power and authority to exchange,
      sell, assign and transfer the Old Notes exchanged hereby and to enter
      into this Exchange Agreement and perform all obligations required to be
      performed by the undersigned hereunder.
    

    
      (b)       The undersigned has been the beneficial owner of the Old Notes
      continuously since at least August 1, 2014 and is the current beneficial
      owner of the Old Notes.  When the Old Notes are exchanged, the Company
      will acquire good, marketable and unencumbered title thereto, free and
      clear of all liens, restrictions, charges and encumbrances.  The Old
      Notes exchanged hereby are not subject to any adverse claims, rights or
      proxies.
    

    
      (c)       The Exchange will not contravene any law, rule or regulation
      binding on the undersigned or any investment guideline or restriction
      applicable to the undersigned.
    

    
      (d)       The undersigned is a resident of the state set forth on the
      signature page hereto and is not acquiring the Exchange Shares or the
      2044 Notes as a nominee or agent or otherwise for any other person.
    

    
      (e)       The undersigned will comply with all applicable laws and
      regulations in effect in any jurisdiction in which the undersigned
      purchases (or acquires pursuant to the Exchange) or sells Exchange
      Shares or 2044 Notes and will obtain any consent, approval or permission
      required for such purchases, acquisitions or sales under the laws and
      regulations of any jurisdiction to which the undersigned is subject or
      in which the undersigned makes such purchases, acquisitions or sales,
      and the Company shall have no responsibility therefor.
    

    
      (f)        The undersigned has received a copy of the Private Placement
      Documents.  The undersigned acknowledges that no person has been
      authorized to give any information or to make any representation
      concerning the Company or the Exchange other than as contained in the
      Private Placement Documents and the information given by the Company’s
      duly authorized officers and employees in connection with the
      undersigned’s examination of the Company and the terms of the Exchange,
      the Consideration, and the Company does not, and J. Wood Capital
      Advisors LLC (“JWCA”) does not, take any responsibility
      for, and neither the Company nor JWCA can provide any assurance as to
      the reliability of, any other information that others may provide to the
      undersigned.
    

    
      
        

        

      

      
        
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      (g)       The undersigned understands and accepts that the 2044 Notes
      and Exchange Shares to be acquired in the Exchange involve risks,
      including those described in the Private Placement Documents.  The
      undersigned has such knowledge, skill and experience in business,
      financial and investment matters that the undersigned is capable of
      evaluating the merits and risks of the Exchange and an investment in the
      Exchange Shares and the 2044 Notes.  With the assistance of the
      undersigned’s own professional advisors, to the extent that the
      undersigned has deemed appropriate, the undersigned has made its own
      legal, tax, accounting and financial evaluation of the merits and risks
      of an investment in the Exchange Shares and the 2044 Notes and the
      consequences of the Exchange and this Exchange Agreement.  The
      undersigned has considered the suitability of the Exchange Shares and
      the 2044 Notes as an investment in light of its own circumstances and
      financial condition and the undersigned is able to bear the risks
      associated with an investment in the Exchange Shares and the 2044 Notes.
    

    
      (h)       The undersigned confirms that it is not relying on any
      communication (written or oral) of the Company, JWCA or any of their
      affiliates as investment advice or as a recommendation to participate in
      the Exchange and receive the Consideration in exchange for Old
      Notes.  It is understood that information provided in the Private
      Placement Documents, the Final Private Placement Document or by the
      Company, JWCA or any of its affiliates shall not be considered
      investment advice or a recommendation with respect to the Exchange, and
      that neither the Company, JWCA nor any of its or their affiliates is
      acting or has acted as an advisor to the undersigned in deciding whether
      to participate in the Exchange and to exchange Old Notes for the
      Consideration.
    

    
      (i)       The undersigned confirms that the Company has not (A) given
      any guarantee or representation as to the potential success, return,
      effect or benefit (either legal, regulatory, tax, financial, accounting
      or otherwise) of an investment in the Exchange Shares and the 2044 Notes
      or (B) made any representation to the undersigned regarding the legality
      of an investment in the Exchange Shares and the 2044 Notes under
      applicable investment guidelines, laws or regulations.  In deciding to
      participate in the Exchange, the undersigned is not relying on the
      advice or recommendations of the Company or JWCA and the undersigned has
      made its own independent decision that the investment in the Exchange
      Shares and the 2044 Notes is suitable and appropriate for the
      undersigned.
    

    
      (j)       The undersigned is familiar with the business and financial
      condition and operations of the Company and has conducted its own
      investigation of the Company, the Exchange Shares and the 2044
      Notes.  The undersigned has had access to the Securities and Exchange
      Commission filings of the Company and such other information concerning
      the Company, the Exchange Shares and the 2044 Notes as it deems
      necessary to enable it to make an informed investment decision
      concerning the Exchange.  The undersigned has been offered the
      opportunity to ask questions of the Company and received answers
      thereto, as it deems necessary to enable it to make an informed
      investment decision concerning the Exchange.
    

    
      
        

        

      

      
        
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      (k)      The undersigned understands that no federal or state agency has
      passed upon the merits or risks of an investment in the Exchange Shares
      and the 2044 Notes or made any finding or determination concerning the
      fairness or advisability of this investment.
    

    
      (l)       The undersigned is an “accredited investor” as defined in Rule
      501(a) under the Securities Act and it and any account for which it is
      acting is a “qualified institutional buyer” as defined in Rule 144A
      under the Securities Act.  The undersigned agrees to furnish any
      additional information requested by the Company or any of its affiliates
      to assure compliance with applicable U.S. federal and state securities
      laws in connection with the Exchange.
    

    
      (m)     The undersigned is not directly, or indirectly through one or
      more intermediaries, controlling or controlled by, or under direct or
      indirect common control with, the Company and is not, and has not been
      for the immediately preceding three months, an “affiliate” (within the
      meaning of Rule 144 under the Securities Act) of the Company.
    

    
      (n)      The undersigned is acquiring the Exchange Shares and the 2044
      Notes solely for the undersigned’s own beneficial account, for
      investment purposes, and not with a view to, or for resale in connection
      with, any distribution of the Exchange Shares or the 2044 Notes.  The
      undersigned understands that the Exchange Shares and the 2044 Notes have
      not been registered under the Securities Act or any state securities
      laws by reason of specific exemptions under the provisions thereof which
      depend in part upon the investment intent of the undersigned and the
      accuracy of the other representations made by the undersigned in this
      Exchange Agreement.  The undersigned understands that the Company is
      relying upon the representations and agreements contained in this
      Exchange Agreement (and any supplemental information) for the purpose of
      determining whether the undersigned’s participation in the Exchange
      meets the requirements for such exemptions.
    

    
      (o)       The undersigned acknowledges that the terms of the Exchange
      have been mutually negotiated between the undersigned and the Company.
    

    
      (p)       The undersigned acknowledges the Company intends to pay JWCA a
      fee in respect of the Exchange.
    

    
      (q)       The undersigned will, upon request, execute and deliver any
      additional documents deemed by the Company, the Old Notes Trustee, the
      2044 Notes Trustee or the Transfer Agent to be necessary or desirable to
      complete the exchange, assignment and transfer of the Old Notes
      exchanged hereby.
    

    
      (r)       The undersigned understands that, unless the undersigned
      notifies the Company in writing to the contrary at or before the
      Closing, each of the undersigned’s representations and warranties
      contained in this Exchange Agreement will be deemed to have been
      reaffirmed and confirmed as of the Closing, taking into account all
      information received by the undersigned.
    

    
      (s)       The undersigned was given a meaningful opportunity to
      negotiate the terms of the Exchange.
    

    
      
        

        

      

      
        
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      (t)       The undersigned’s participation in the Exchange was not
      conditioned by the Company on the undersigned’s exchange of a minimum
      principal amount of Old Notes for the Consideration.
    

    
      (u)       The undersigned does not have an ownership interest equal to
      or greater than either 5% of the number of shares of Common Stock of the
      Company or 5% of the voting power outstanding of the Company, in each
      case, before the initial issuance of the securities issued in the
      Exchange.
    

    
      (v)       The undersigned had a sufficient amount of time to consider
      whether to participate in the Exchange and neither the Company nor JWCA
      put any pressure on the undersigned to respond to the opportunity to
      participate in the Exchange.
    

    
      6.        Conditions to
      Obligations of the Undersigned and the Company.  The obligations of
      the undersigned to deliver the Old Notes and of the Company to deliver
      the Consideration are subject to the satisfaction at or prior to the
      Closing of the following conditions precedent: the representations and
      warranties of the Company contained in Section 4 hereof and of
      the undersigned contained in Section 5 hereof shall be true and
      correct as of the Closing in all respects with the same effect as though
      such representations and warranties had been made as of the Closing.  
    

    
      7.        Covenant and
      Acknowledgment of the Company.  At or prior to 9:00 a.m., New York
      City time, on August 12, 2014, the Company shall file its press release
      announcing the Exchange (including the “Exchanges”, if any, with holders
      of Old Notes executing exchange agreements on the date hereof) on Form
      8-K, which press release the Company acknowledges and agrees will
      disclose all “Transaction Information” (as defined in the non-disclosure
      letter agreement entered into between the undersigned and JWCA) to the
      extent such “Transaction Information” constitutes material non-public
      information regarding the Company or its securities.
    

    
      8.        Waiver, Amendment.  Neither
      this Exchange Agreement nor any provisions hereof shall be modified,
      changed, discharged or terminated except by an instrument in writing,
      signed by the party against whom any waiver, change, discharge or
      termination is sought.
    

    
      9.        Assignability.  Neither
      this Exchange Agreement nor any right, remedy, obligation or liability
      arising hereunder or by reason hereof shall be assignable by either the
      Company or the undersigned without the prior written consent of the
      other party.
    

    
      10.      Taxation.  The undersigned
      acknowledges that either (i) the Company must be provided with a correct
      taxpayer identification number (“TIN”), generally a
      person’s social security or federal employer identification number, and
      certain other information on Internal Revenue Service (“IRS”)
      Form W-9, which is provided as an attachment hereto, and a
      certification, under penalty of perjury, that such TIN is correct, that
      the undersigned is not subject to backup withholding and that the
      undersigned is a United States person, or (ii) another basis for
      exemption from backup withholding must be established.
    

    
      11.      Waiver of Jury Trial.  THE
      UNDERSIGNED IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY WITH
      RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF THE TRANSACTIONS
      CONTEMPLATED BY THIS EXCHANGE AGREEMENT.
    

    
      
        

        

      

      
        
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      12.      Governing Law.  This
      Exchange Agreement shall be governed by and construed in accordance with
      the laws of the State of New York, without giving effect to such state’s
      rules concerning conflicts of laws that might provide for any other
      choice of law.
    

    
      13.      Section and Other Headings.  The
      section and other headings contained in this Exchange Agreement are for
      reference purposes only and shall not affect the meaning or
      interpretation of this Exchange Agreement.
    

    
      14.      Counterparts.  This
      Exchange Agreement may be executed in any number of counterparts, each
      of which when so executed and delivered shall be deemed to be an
      original and all of which together shall be deemed to be one and the
      same agreement.
    

    
      15.      Notices.  All notices and
      other communications to the Company provided for herein shall be in
      writing and shall be deemed to have been duly given if delivered
      personally or sent by registered or certified mail, return receipt
      requested, postage prepaid to the following addresses, or in the case of
      the undersigned, the address provided on the signature page below (or
      such other address as either party shall have specified by notice in
      writing to the other):
    


    	
          If to the Company:
        	
          
            Molina Healthcare, Inc.
          

          
            200 Oceangate, Suite 100
          

          
            Long Beach, CA 90802-4317
          

          
            Attn: John C. Molina
          

          
            Telephone: (888) 562-5442 x111228
          

          
            E-mail: john.molina@molinahealthcare.com
          

        


    

    
      16.      Binding Effect.  The
      provisions of this Exchange Agreement shall be binding upon and accrue
      to the benefit of the parties hereto and their respective heirs, legal
      representatives, successors and permitted assigns.
    

    
      17.      Notification of Changes.  The
      undersigned hereby covenants and agrees to notify the Company upon the
      occurrence of any event prior to the closing of the Exchange pursuant to
      this Exchange Agreement which would cause any representation, warranty,
      or covenant of the undersigned contained in this Exchange Agreement to
      be false or incorrect.
    

    
      18.      Severability.  If any term
      or provision of this Exchange Agreement is invalid, illegal or
      unenforceable in any jurisdiction, such invalidity, illegality or
      unenforceability shall not affect any other term or provision of this
      Exchange Agreement or invalidate or render unenforceable such term or
      provision in any other jurisdiction.
    

    
      [SIGNATURE PAGE FOLLOWS]
    

    

    

    
      
        

        

      

      
        
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      IN WITNESS WHEREOF, the undersigned has executed this Exchange Agreement
      as of the date first written above.
    

    
      Holder:
    

    

    

    

    

    

    

    

    

    
      By                                                                                                          
    

    
      Name:
Title:    

    

    
      Address:
    

    

    

    

    

    
      Telephone:
    

    

    

    
      State/Country of Domicile or Formation:
    

    

    

    

    

    

    

    

    


    	
           
        
	
          
            Old Notes to Be Exchanged
          

        
	
           
        
	
          
            $        aggregate
            principal amount of the Old Notes
          

        


    

    

    

    

    


    	
           
        	
           
        
	
          Beneficial Owner of Old Note:
        	
           
        
	
          Principal Amount of Old Notes to be exchanged:
        	
          
            $         principal
          

        
	
          Account Broker:
        	
           
        
	
          DTC Participant No.:
        	
           
        
	
          Applicable Interest Amount:
        	
          $
        
	
          2044 Notes:
        	
          $
        


    

    
      
        

        

      

      
        

        

        
          


        

      

      
        

        

      

    

    
      The offer to exchange Old Notes for the Consideration as set forth above
      is confirmed and accepted by the Company.
    

    
      MOLINA HEALTHCARE, INC.
    

    

    

    

    

    

    

    
      By                                                                                                                              
    

    
      Name:
    

    
      Title:
    

    

    

    
      
        

        

      

      
        

        

        
          


        

      

      
        

        

      

    

    
      Exhibit A
    

    
      Wiring instructions for Applicable Interest Amount on Old Notes
    

    
    	
           
        	
           
        
	
          Beneficial Owner of Old Note
        	
           
        
	
          Bank Name
        	
           
        
	
          ABA #
        	
           
        
	
          For Credit To
        	
           
        
	
          Account #
        	
           
        
	
          For Further Credit to
        	
           
        
	
          Account #
        	
           
        


    

    
      
        

        

      

      
        

        

        
          


        

      

      
        

        

      

    

    
      Exhibit B
    

    

    

    
      Under U.S. federal income tax law, a holder who exchanges Old Notes for
      the Consideration generally must provide such holder’s correct taxpayer
      identification number (“TIN”) on IRS Form W-9 (attached
      hereto) or otherwise establish a basis for exemption from backup
      withholding.  A TIN is generally an individual holder’s social security
      number or a holder’s employer identification number.  If the correct TIN
      is not provided, the holder may be subject to a $50 penalty imposed by
      the IRS.  In addition, certain payments made to holders may be subject
      to U.S. backup withholding tax (currently set at 28% of the
      payment).  If a holder is required to provide a TIN but does not have
      the TIN, the holder should consult its tax advisor regarding how to
      obtain a TIN.  Certain holders are not subject to these backup
      withholding and reporting requirements.  Non-U.S. Holders generally may
      establish their status as exempt recipients from backup withholding by
      submitting a properly completed applicable IRS Form W-8 (available from
      the Company or the IRS at www.irs.gov), signed, under penalties
      of perjury, attesting to such holder’s exempt foreign status.  U.S.
      backup withholding is not an additional tax.  Rather, the U.S. federal
      income tax liability of persons subject to backup withholding will be
      reduced by the amount of tax withheld.  If withholding results in an
      overpayment of taxes, a refund may be obtained provided that the
      required information is timely furnished to the IRS.  Holders are urged
      to consult their tax advisors regarding how to complete the appropriate
      forms and to determine whether they are exempt from backup withholding
      or other withholding taxes.