General Counsel Employment Agreement

EXHIBIT 10.73


[LETTERHEAD]


June 25, 1998


Mr. B. Curtis Westen 2022 W. Las Flores Pueblo West, CO 81007


Re: Offer of Relocation and Employment


Dear Curt:


On behalf of Foundation Health Systems, Inc. ("FHS"), I would like to confirm our offer to you for the relocation of your position of Senior Vice President, General Counsel and Secretary of FHS to our corporate offices in Woodland Hills, California. In this position you will devote your full professional attention to the duties and responsibilities assigned to you. You will physically relocate your office to Woodland Hills as soon as practicable following the sale of your Pueblo residence. In this position you will report directly to the Chairman and Chief Executive Officer of FHS and will earn a monthly salary of at least $29,166.67, effective upon your relocation. Associates are paid on a bi-weekly basis with 26 pay periods per year. Performance of each of the Company's Associates is generally reviewed on an annual basis, and any adjustment to salary is ordinarily made upon the completion of such performance review. Any adjustment to your compensation must be made with the approval of the Compensation and Stock Option Committee of the FHS Board of Directors (the "Committee"). You will be provided an automobile allowance of $1,000 per month, subject to normal payroll deductions, and subject to any changes to the FHS automobile allowance policy that may be made from time to time.


Upon your relocation and/or your purchase of a new residence in the Woodland Hills, California area, FHS will provide to you a one-time $250,000 loan (with interest accrued at the Prime Rate) payable by you upon demand in the event of voluntary termination of your employment or should the Company terminate you for cause. The principal and any accrued interest will be forgiven, one-third on each of the first, second and third anniversaries of the date of this letter. Additionally, the loan plus accrued interest will be forgiven in total prior to the third anniversary if you depart from the Company involuntarily without cause, due to "Good Reason" following a change of control, or due to death or disability. Good Reason, Change of Control and Cause are defined within the Severance Payment Agreement entered into between yourself and FHS on April 6, 1998. The Company agrees that it will consider your reasonable requests, if any, to restructure the timing, nature, and/or characterization of such loan as may be suggested by your tax/financial advisers; provided that such restructuring would not disadvantage the Company and would not result in a modification of your obligation to repay such amount in the instance set forth above. In addition, you agree that the loan proceeds shall be used by you towards your home purchase or the cost of improvements on your new residence.


PAGE 2 OFFER LTR/B. CURTIS WESTEN 6/25/98


You will be eligible to continue your participation in the Company's Executive Incentive Plan, as it may be modified from time to time by the Committee. Under the plan, bonus payments are dependent upon Company and individual performance measures. You will be eligible to participate in the plan in 1998 with a target bonus opportunity of 70 percent of your base salary. The maximum bonus payable under provisions of the plan is 105 percent of base salary. Any bonus payout for 1998 will be paid in 1999 following outside audit of the Company's performance and determination of your success in accomplishing individual performance objectives. To be eligible for any bonus payment, you must be actively employed and on the Company payroll at the time the bonus is paid. Bonus calculations are based on the base annual salary in effect on December 31st of the respective Plan Year. It is understood that the Committee and the Company will award bonus amounts, if any, as it deems appropriate consistent with the guidelines of the Plan. You acknowledge that in the event you are to be one of the top five highest paid executive officers of the Company for a given year under applicable federal securities laws, your bonus for that year, if any, will be subject to the Company's Performance Based 162(m) Plan in lieu of the Executive Incentive Plan.


In addition to the foregoing, subject to your continued employment with the Company and plan provisions, you will be eligible to receive and/or participate in Company-offered benefits subject to plan criteria. You will receive under separate cover, information about Company benefits programs, including group medical, dental, vision, life insurance, short-term and long-term disability insurance, 401(k), Company-recognized holidays, the employee stock purchase plan, tuition reimbursement and participation in our deferred compensation program. In our 401(k) plan, subject to IRS regulations, the Company will match your contribution at $.50 for every dollar contributed up to six percent (6%) of salary. In the deferred compensation plan you may defer up to 50 percent of your base compensation and up to 100 percent of your incentive compensation. The Company's Paid Time Off ("PTO") benefit will be provided to you for illness, vacation and personal time off. The Company will also reimburse you the reasonable expense for one athletic/health club and one country or social club membership. In case of a conflict between this summary and the official plan documents, the official Plan documents will always govern. In addition, the Company reserves the right to change, amend, or terminate the benefits plans at any time, with ...