Health Net 2010 Annual Report Download - page 185

Final Execution Copy
revised pursuant to Section 4.2 in connection with the addition of a new In-Scope Application, the revised Production Support Charge
shall, at a minimum, reflect the Productivity Commitments stated in the table below for each remaining year of the Term.
(a) Supplier shall hire 76 Transitioned Employees in accordance with Schedule E as of the applicable Transfer Date defined in
Schedule E. Of the 76 Transitioned Employees, 47 will be assigned to perform Production Support Services. Supplier shall be fully
compensated for such 47 Transitioned Employees through the Production Support Charge.
(b) The Production Support Charge assumes the Transfer Date (defined in Schedule E) for all 47 Transitioned Employees shall
be November 16, 2008. ***.
(c) Without limiting any of Supplier’s obligations under this Agreement with respect to Supplier Personnel, Health Net shall
have the right to assign and prioritize work for each Transitioned Employee during the period between the applicable Transfer Date
and the Scheduled Steady-State Date for the In-Scope Application on which such Transitioned Employee is assigned to work.
Exhibit C-7 sets forth the skillset mix and individual supporting skillset rates that were used to determine the blended T&M
Rates in Exhibit C-6 for each In-Scope Application (“Supporting Skillset Rates”). The Supporting Skillset Rates shall be used solely
for (a) benchmarking, (b) to create new T&M Rates pursuant to Section 4.3(a), and (c) to adjust the T&M Rates for an In-Scope
Application if Health Net requests a material change in the skillset mix for such In-Scope Application. If Health Net requests a
material change under item (c) above, the Parties shall document the new skillset mix requested by Health Net in Exhibit C-7 and
revise the blended T&M Rates in Exhibit C-6 to reflect the new skillset mix using the individual Supporting Skillset Rates in Exhibit
C-7. For clarification, the adjustment in item (c) shall apply only if Health Net requests a change in skillset mix; it shall not apply if
Supplier determines that it requires a different skillset mix in order to provide the Services described in this Agreement.
Exhibit A-6 (Project Framework) sets forth a framework and terms under which Health Net may authorize Supplier to perform
Applications Development Projects. This Section 5 describes how the Charges for AD Projects shall be determined.
(a) Exhibit C-3 sets forth a monthly charge for the volume of Applications Development Services authorized by Health Net as of
the Effective Date (“Applications Development Charge” or “AD Charge”). The AD Charge consists of the following components for
each In-Scope Application:
(i) The Onshore Personnel and Offshore Personnel components of the AD Charge for each In-Scope Application in Exhibit
C-3 are determined by multiplying the volume of Productive Hours for Onshore Personnel (excluding Transitioned Employees) and
Offshore Personnel set forth in Exhibit C-4 for each such In-Scope Application by the applicable T&M Rates in Exhibit C-6;
Contract Years
CY 1 CY 2 CY 3 CY 4 CY 5
Productivit
y
Commitment *** *** *** *** ***
4.7 Transitioned Employees
4.8 Supporting Skillset Rates
5. APPLICATIONS DEVELOPMENT
5.1 General Terms
Schedule C (Char
g
es) C - 6 Health Net / Co
g
nizant Confidential