exv10w15



 





Exhibit 10.15




CHANGE IN CONTROL AGREEMENT




     THIS CHANGE IN CONTROL AGREEMENT (the “Agreement”) is entered into as of March 1, 2008, (the
“Effective Date”), by and between Joseph White (the “Executive”) and Molina Healthcare, Inc., a
Delaware corporation (the “Company”).




	1.	 	Definitions. The following definitions shall apply for all purposes under this
Agreement:





     (a) Change in Control. “Change in Control” means the occurrence of any of the
following events after the Effective Date:




	 	(i)	 	The acquisition (other than by an Excluded Person), directly or
indirectly, in one or more transactions, by any person or by any group of
persons, within the meaning of Section 13(d) or 14(d) of the Exchange Act, of
beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of
more than fifty percent (50%) of either the outstanding shares of common stock
or the combined voting power of the Company’s outstanding voting securities
entitled to vote generally, whether or not the acquisition was previously
approved by the existing directors, other than an acquisition that complies
with clause (x) and (y) of paragraph (ii);
	 
	 	(ii)	 	Consummation of a reorganization, merger, or consolidation of
the Company or the sale or other disposition of all or substantially all of the
Company’s assets unless, immediately following such event, (x) all or
substantially all of the stockholders of the Company immediately prior to such
event own, directly or indirectly, more than fifty percent (50%) of the then
outstanding voting securities of the resulting corporation (including without
limitation, a corporation which as a result of such event owns the Company or
all or substantially all of the Company’s assets either directly or indirectly
through one or more subsidiaries) and (y) the securities of the surviving or
resulting corporation received or retained by the stockholders of the Company
are publicly traded;
	 
	 	(iii)	 	Approval by the stockholders of the complete liquidation or
dissolution of the Company; or
	 
	 	(iv)	 	A change in the composition of a majority of the directors on
the Company’s Board of Directors within 12 months if not approved by a majority
of the pre-existing directors.





     A transaction shall not constitute a Change in Control if its sole purpose is to change the
state of the Company’s incorporation or to create a holding company that will be owned in
substantially the same proportions by the persons who held the Company’s securities immediately
before such transaction.



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     (b) Excluded Person. “Excluded Person” means:




	 	(i)	 	Any person described in and satisfying the conditions of Rule
13d-1(b)(1) under the Exchange Act;
	 
	 	(ii)	 	The Company;
	 
	 	(iii)	 	An employee benefit plan (or related trust) sponsored or
maintained by the Company or its successor;
	 
	 	(iv)	 	Any person who is the beneficial owner (as defined in Rule
13d-3 under the Exchange Act) of more than 15% of the Common Stock on the
Effective Date (or any affiliate, successor, heir, descendant, or related party
of or to such person).





     (c) Good Reason. “Good Reason” shall mean that, on or after the effective date of a
Change in Control, the Executive (without Executive’s written consent):




	 	(i)	 	Has incurred a material reduction in his or her authority or
responsibility in comparison to the Executive’s authority or responsibility
prior to the public announcement of the Change in Control (the “Announcement”);
	 
	 	(ii)	 	Has incurred one or more reductions in his or her “total
compensation” which is defined as follows:
	 
	 	(A)	 	any reduction in base salary, or
	 
	 	(B)	 	any reduction in the target annual bonus percentage of base salary; or
	 
	 	(iii)	 	Has been notified that his or her principal place of work will
be relocated by a distance of 50 miles or more.





     For purposes of this Agreement, “base salary” shall mean the Executive’s annualized base
salary as of the Effective Date, as may be subsequently adjusted upward for increases.



     (d) Just Cause. “Just Cause” includes but is not limited to any of the following
committed by Executive (or omitted to be done by Executive) that occur on or after the Effective
Date:




	 	(i)	 	Theft, unethical or unlawful activity, or other dishonesty;
	 
	 	(ii)	 	Neglect of or failure to perform employment duties;
	 
	 	(iii)	 	Inability or unwillingness to perform employment duties;
	 
	 	(iv)	 	Insubordination;
	 
	 	(v)	 	Abuse of alcohol or other drugs or substances;




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	 	(vi)	 	Breach of this Agreement;
	 
	 	(vii)	 	A conviction of or plea of “guilty” or “no contest” to a
felony under the laws of the United States or any state thereof; or
	 
	 	(viii)	 	Any violation or breach of any Company policy that has been established to
comply with either the Sarbanes-Oxley Act of 2002 (or any regulations or rules
or decisions that implement/interpret such act) or any laws, rules, or
requirements of the Securities and Exchange Commission or the New York Stock
Exchange.





     (e) Total Disability. “Total Disability” shall be deemed to occur on the ninetieth
(90th) consecutive or non-consecutive calendar day within any twelve (12) month period that
Executive is unable to perform his or her duties because of any physical or mental illness or
disability.




	2.	 	Severance Payment and Equity Compensation.





     (a) The Executive shall be entitled to receive a severance payment from the Company as
provided herein (the “Severance Payment”) if within the first twelve (12) month period after the
occurrence of a Change in Control, either:




	 	(i)	 	The Executive voluntarily resigns his or her employment for
Good Reason within sixty (60) days after the Executive becomes aware of the
occurrence of an event specified in Section 1(c); or
	 
	 	(ii)	 	The Company terminates the Executive’s employment for any
reason other than Just Cause, death, or Total Disability.





     For all purposes under this Agreement, the amount of the Severance Payment shall be equal to
two times (2X) the Executive’s annual base salary, as in effect on the date of the termination of
Executive’s employment (or if Executive’s salary was greater, on the date of the Announcement),
plus a prorata portion of the Executive’s target bonus for the fiscal year in which Executive’s
employment is terminated, based on the number of entire months of such fiscal year that have
elapsed through the date of Executive’s termination of employment as a fraction of twelve (12).
The Severance Payment shall be made to Executive in a single lump sum cash payment not later than
seven (7) business days following the date that Executive becomes entitled to a Severance Payment.



     Except as may be provided under Sections 2(b) and 2(c), the Severance Payment shall be in lieu
of any other post-termination employment payments.



     (b) Incentive, Deferred Compensation, and Retirement Programs. If the Executive is
entitled to a Severance Payment under Section 2(a) and notwithstanding anything to the contrary in
any stock option or stock appreciation right (SAR) or deferred compensation plan or retirement plan
or agreements, then (i) the Executive shall become immediately fully vested in all of his or her
outstanding stock options, SARs, warrants, restricted stock, phantom stock, deferred compensation,
retirement or similar plans or agreements of the Company, and (ii) the Executive (or his or her
personal representative if applicable) shall be permitted to exercise any of his or her vested
stock



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options/SARs until the earlier of (i) one (1) year after Executive’s termination of employment
or (ii) the term of such unexercised stock options, warrants, or SARs.



     (c) Health Coverage. If the Executive is entitled to a Severance Payment under Section
2(a), the Company shall reimburse Executive for a portion of the cost of any group health
continuation coverage that the Company is otherwise required to offer under the Consolidated
Omnibus Budget Reconciliation Act of 1986 (“COBRA”) until the earlier of the date that (i) the
Executive becomes covered by comparable health coverage, offered by another employer, or (ii) is
twelve (12) months after the date upon which the Executive becomes entitled to a Severance Payment
under Section 2(a). The Executive shall continue to be responsible to pay for the cost of the
employee portion of COBRA coverage (such employee portion cost shall not be reimbursed by the
Company).



     (d) Mitigation. Except as may be expressly provided elsewhere in this Agreement, the
Executive shall not be required to mitigate the amount of any payment or benefit contemplated by
this Section 2 (whether by seeking new employment or in any other manner). No such payment shall
be reduced by earnings that the Executive may receive from any other source.



     (e) Conditions. All payments and benefits provided under this Section 2 are
conditioned on Executive’s continuing compliance with this Agreement and the Company’s policies.
All payments and benefits are also conditioned on, and in consideration for, Executive’s execution
(and effectiveness) of a release of claims and covenant not to sue substantially in the form
provided in Exhibit A upon termination of employment, to be delivered by Executive
simultaneously upon payment by the Company.




	3.	 	Successors.





     (a) Company’s Successors. Any successor (whether direct or indirect and whether by
purchase, lease, merger, consolidation, liquidation, or otherwise) to all or substantially all of
the Company’s business and/or assets, shall be obligated to perform this Agreement in the same
manner and to the same extent as the Company would be required to perform it in the absence of a
succession.



     (b) Executive’s Successors. This Agreement and all rights of the Executive hereunder
shall inure to the benefit of, and be enforceable by, the Executive’s personal or legal
representatives, executors, administrators, successors, heirs, distributees, devisees, and
legatees.




	4.	 	Miscellaneous Provisions.





     (a) Notice. Notices and all other communications contemplated by this Agreement shall
be in writing and shall be deemed to have been duly given when personally delivered or when mailed
by U.S. registered or certified mail, return receipt requested and postage prepaid. In the case of
the Executive, mailed notices shall be addressed to him or her at the home address which he or she
most recently communicated to the Company in writing. In the case of the Company, mailed notices
shall be addressed to its corporate headquarters, and all notices shall be directed to the
attention of its Secretary.



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     (b) Waiver. No provision of this Agreement shall be modified, waived or discharged
unless the modification, waiver or discharge is agreed to in writing and signed by the Executive
and by an authorized officer of the Company (other than the Executive). No waiver by either party
of any breach of, or of compliance with, any condition or provision of this Agreement by the other
party shall be considered a waiver of any other condition or provision or of the same condition or
provision at another time.



     (c) Whole Agreement. This Agreement contains all the legally binding understandings
and agreements between Executive and the Company pertaining to the subject matter of this Agreement
and supersedes all such agreements, whether oral or in writing, previously entered into between the
parties.



     (d) Withholding Taxes. All payments made under this Agreement shall be subject to
reduction to reflect taxes required to be withheld by law.



     (e) Choice of Law. The validity, interpretation, construction, and performance of
this Agreement shall be governed by the laws of the State of California without regard to the
conflicts of laws principles thereof.



     (f) Severability. The invalidity or unenforceability of any provision or provisions
of this Agreement shall not affect the validity or enforceability of any other provision hereof,
which shall remain in full force and effect.



     (g) Arbitration. Any controversy or claim arising out of or relating to this
Agreement, or the breach thereof, shall be settled by arbitration in Los Angeles County in
accordance with the Commercial Arbitration Rules of the American Arbitration Association.
Discovery shall be permitted to the same extent as in a proceeding under the Federal Rules of Civil
Procedure, including (without limitation) such discovery as is specifically authorized by section
1283.05 of the California Code of Civil Procedure, without need of prior leave of the arbitrator
under section 1283.05(e) of such Code. Judgment on the award rendered by the arbitrator may be
entered in any court having jurisdiction thereof. All fees and expenses of the arbitrator and such
Association and attorney fees shall be paid as determined by the arbitrator.



     (h) No Assignment. The rights of Executive to payments or benefits under this
Agreement shall not be made subject to option or assignment, either by voluntary or involuntary
assignment or by operation of law, including (without limitation) bankruptcy, garnishment,
attachment or other creditor’s process, and any action in violation of this Subsection (h) shall be
void.



     (i) Nondisparagement; Confidentiality. On the Effective Date and thereafter,
Executive agrees that he/she will not disparage the Company or its directors, officers, employees,
affiliates, subsidiaries, predecessors, successors or assigns in any written or oral communications
to any third party. Executive further agrees that he/she will not direct anyone to make any
disparaging oral or written remarks to any third parties. During Executive’s employment and
following Executive’s termination of employment for any reason, Executive agrees to not
intentionally use or disclose the confidential information or trade secrets of the Company.



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     (j) Nonsolicit. During the Executive’s employment with Company and for twelve months
after Executive’s termination of employment and payment of the Severance Payment hereunder, the
Executive shall not, directly or indirectly, either as an individual or as an employee, agent,
consultant, advisor, independent contractor, general partner, officer, director, stockholder,
investor, lender, or in any other capacity whatsoever, of any person, firm, corporation, or
partnership: (i) induce or attempt to induce any person who at the time of such inducement is an
employee of the Company to perform work or service for any other person or entity other than the
Company or (ii) participate or engage in the design, development, manufacture, production,
marketing, sale, or servicing of any product, or the provision of any service, that directly or
indirectly relates to Company business.



     (k) Notice of Employment. During Executive’s employment and for twelve months after
Executive’s termination of employment and payment of the Severance Payment hereunder, the Executive
will promptly notify the Company in writing if Executive becomes (or agrees to become) an employee
or director of any other employer. Such notice shall include the name of the other employer and
the date of commencement of employment or service as a director.



     IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the
Company by its duly authorized officer, as of the day and year first above written.



	 	 	 	 	 
	 	EXECUTIVE:

 	 
	 	/s/ Joseph White
 	 
	 	Joseph White 	 
	 	 	 
	 
	 	MOLINA HEALTHCARE, INC.:

 	 
	 	/s/ John C. Molina
 	 
	 	By:   John C. Molina 	 
	 	Its:   Chief Financial Officer 	 



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EXHIBIT A




Form of Release of Claims and Covenant Not To Sue



In consideration of the payments and other benefits that Molina Healthcare, Inc., a Delaware
corporation (the “Company”), is providing to Joseph White (“Executive”) under the Change in Control
Agreement entered into by and between Executive and the Company, dated June 12, 2006, the
Executive, on his or her own behalf and on behalf of Employee’s representatives, agents, heirs and
assigns, waives, releases, discharges and promises never to assert any and all claims, demands,
actions, costs, rights, liabilities, damages or obligations of every kind and nature, whether known
or unknown, suspected or unsuspected that Executive ever had, now have or might have as of the date
of Executive’s termination of employment with the Company against the Company or its predecessors,
parent, affiliates, subsidiaries, stockholders, owners, directors, officers, employees, agents,
attorneys, insurers, successors, or assigns (including all such persons or entities that have a
current and/or former relationship with the Company) for any claims arising from or related to
Executive’s employment with the Company, its parent or any of its affiliates and subsidiaries and
the termination of that employment.



These released claims also specifically include, but are not limited to, any claims arising under
any federal, state and local statutory or common law, such as (as amended and as applicable) Title
VII of the Civil Rights Act, the Age Discrimination in Employment Act, the Americans With
Disabilities Act, the Employee Retirement Income Security Act, the Family Medical Leave Act, the
Equal Pay Act, the Fair Labor Standards Act, the Industrial Welfare Commission’s Orders, the
California Fair Employment and Housing Act, the California Constitution, the California Government
Code, the California Labor Code and any other federal, state or local constitution, law, regulation
or ordinance governing the terms and conditions of employment or the termination of employment, and
the law of contract and tort and any claim for attorneys’ fees.



Furthermore, the Executive acknowledges that this waiver and release is knowing and voluntary and
that the consideration given for this waiver and release is in addition to anything of value to
which Executive was already entitled. Executive acknowledges that there may exist facts or claims
in addition to or different from those which are now known or believed by Executive to exist.
Nonetheless, this Agreement extends to all claims of every nature and kind whatsoever, whether
known or unknown, suspected or unsuspected, past or present. Executive also expressly waives the
provisions of California Civil Code section 1542, which provides: “A general release does not
extend to claims which the creditor does not know or suspect to exist in his favor at the time of
executing the release, which if known by him/her must have materially affected his settlement with
the debtor.” With respect to the claims released in the preceding sentences, the Executive will
not initiate or maintain any legal or administrative action or proceeding of any kind against the
Company or its predecessors, parent, affiliates, subsidiaries, stockholders, owners, directors,
officers, employees, agents, successors, or assigns (including all such persons or entities that
have a current or former relationship with the Company), for the purpose of obtaining any personal
relief, nor assist or participate in any such proceedings, including any proceedings brought by any
third parties (except as otherwise required or permitted by law). The Executive further
acknowledges that he has been advised by this writing that:




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	 	•	 	he should consult with an attorney prior
to executing this release;
	 
	 	•	 	he has at least twenty-one (21) days within which
to consider this release;
	 
	 	•	 	he has up to seven (7) days following the
execution of this release by the parties to revoke
the release; and
	 
	 	•	 	this release shall not be effective until such
seven (7) day revocation period has expired.




Executive agrees that the release set forth above shall be and remain in effect in all respects as
a complete general release as to the matters released.




EXECUTIVE




                                                               
        

Joseph White




Date:





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