UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
| Date of Report (Date of Earliest Event Reported): | October 10, 2005 |
Health Net, Inc.
__________________________________________
(Exact name of registrant as specified in its charter)
| Delaware | 1-12718 | 95-4288333 |
| _____________________ (State or other jurisdiction | _____________ (Commission | ______________ (I.R.S. Employer |
| of incorporation) | File Number) | Identification No.) |
| 21650 Oxnard Street, Woodland Hills, California | 91367 | |
| _________________________________ (Address of principal executive offices) | ___________ (Zip Code) |
| Registrant’s telephone number, including area code: | (818) 676-6000 |
Not Applicable
______________________________________________
Former name or former address, if changed since last report
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement.
On October 10, 2005, Health Net, Inc. and Jeffrey Folick, Executive Vice President, Regional Health Plans & Specialty Companies, entered into a third amendment (the "Third Amendment") to the employment letter agreement between Health Net and Mr. Folick dated as of May 22, 2002 (the "Original Agreement"), as amended on July 2, 2004 (the "First Amendment"), and as further amended on January 28, 2005 (the "Second Amendment" and, together with the First Amendment and Third Amendment, the "Amendments").
The following is a brief summary of the material terms of the Amendments and is not intended to be a complete description of all of the terms thereof. For further information, please see the copy of the First Amendment, which is filed as Exhibit 10.1 to Health Net’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2004 and incorporated herein by reference, and a copy of the Second Amendment which is filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed w ith the Securities and Exchange Commission on February 1, 2005 and incorporated herein by reference, and a copy of the Third Amendment which is attached hereto as Exhibit 10.1, and a copy of the Original Agreement which is filed as Exhibit 10.16 to Health Net’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2002 and incorporated herein by reference.
The Amendments, among other things, provide Mr. Folick with the option, exercisable by notifying Health Net in writing no earlier than October 10, 2005, but no later than March 31, 2006, to terminate his employment with Health Net effective thirty days following the date of such notice (the "Effective Date"), provided, that Mr. Folick signs a waiver and release of claims and a restrictive covenant agreement (each substantially in the form attached to the First Amendment), and receive, in lieu of any other severance benefits and participation in Health Net’s 2005 Management Incentive Plan ("2005 MIP") and 2006 Management I ncentive Plan, the following incentive package (the "Incentive Package"): (i) a lump-sum payment equal to two times Mr. Folick’s base salary in effect immediately prior to the Effective Date, benefit continuation for an initial six-month period and payment of COBRA premiums for up to an additional eighteen-month period, and (ii) two separate bonus awards each equal to 50% of his 2005 MIP target opportunity (which target opportunity is 80% of his base salary), provided, that Mr. Folick satisfies certain conditions more fully set forth in the Third Amendment.
If Mr. Folick elects the Incentive Package, he will be prohibited from exercising any of his then vested stock options until after his employment with Health Net has terminated.
If Mr. Folick timely elects the Incentive Package and his employment is thereafter terminated by Health Net without Cause (as defined in the Original Agreement) before the Effective Date, Mr. Folick will remain eligible to receive the Incentive Pa ckage, subject to the terms and conditions set forth in the Amendments. If Mr. Folick is terminated for Cause before the Effective Date, he will not be eligible to receive the Incentive Package.
If Mr. Folick voluntarily terminates his employment at any time before March 31,2006 (except as the result of his timely election to receive the Incentive Package, or for Good Reason (as defined in the Original Agreement) within two years after a change in control of Health Net), Mr. Folick will not be eligible to receive any severance benefits or any amounts under the Incentive Package.
If Mr. Folick does not timely elect the Incentive Package, he will remain subject to the terms and conditions of the Original Agreement.
Item 9.01 Financial Statements and Exhibits.
(c)
10.1 Amended Employment Letter Agreement dated as of October 10, 2005 between Health Net, Inc. and Jeffrey Folick.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Health Net, Inc. | ||||
| October 13, 2005 | By: | B. Curtis Westen | ||
| Name: B. Curtis Westen | ||||
| Title: Senior Vice President, General Counsel and Secretary | ||||
Exhibit Index
| Exhibit No. | Description | |
10.1 | Amended Employment Letter Agreement dated as of October 10, 2005 between Health Net, Inc. and Jeffrey Folick. |
