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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-K
(Mark One)
ÈANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2009
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number: 1-12718
HEALTH NET, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 95-4288333
(State or Other Jurisdiction
of Incorporation or Organization)
(I.R.S. Employer
Identification No.)
21650 Oxnard Street, Woodland Hills, CA 91367
(Address of Principal Executive Offices) (Zip Code)
Registrant’s Telephone Number, Including Area Code: (818) 676-6000
Securities Registered Pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
Common Stock, $.001 par value New York Stock Exchange, Inc.
Rights to Purchase Series A Junior Participating
Preferred Stock
New York Stock Exchange, Inc.
Securities Registered Pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act. Yes ÈNo
Indicate by check mark whether the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act. Yes No È
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ÈNo
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every
Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during
the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and
will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference
in Part III of this Form 10-K or any amendment to this Form 10-K. È
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a
smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in
Rule 12b-2 of the Exchange Act. (Check one):
ÈLarge accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company
(Do not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes No È
The aggregate market value of the voting stock held by non-affiliates of the registrant at June 30, 2009 was $1,603,011,760
(which represents 103,087,573 shares of Common Stock held by such non-affiliates multiplied by $15.55, the closing sales price of
such stock on the New York Stock Exchange on June 30, 2009).
The number of shares outstanding of the registrant’s Common Stock as of February 22, 2010 was 100,190,356 (excluding
44,456,857 shares held as treasury stock).
Documents Incorporated By Reference
Part III of this Form 10-K incorporates by reference certain information from the registrant’s definitive proxy statement for the
2010 Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission within 120 days after the close of
the year ended December 31, 2009.

Table of contents

  • Page 1
    ...) HEALTH NET, INC. (State or Other Jurisdiction of Incorporation or Organization) Delaware (I.R.S. Employer Identification No.) (Zip Code) 95-4288333 91367 21650 Oxnard Street, Woodland Hills, CA (Address of Principal Executive Offices) Registrant's Telephone Number, Including Area Code...

  • Page 2
    HEALTH NET, INC. INDEX TO FORM 10-K Page PART I. Item 1-Business ...General ...Segment Information ...Provider Relationships ...Additional Information Concerning Our Business ...Government Regulation ...Intellectual Property ...Employees ...Dependence Upon Customers ...Shareholder Rights Plan ......

  • Page 3
    ..., dental, vision, behavioral health and disability insurance, including our Medicare Part D Pharmacy coverage under Medicare. Our executive offices are located at 21650 Oxnard Street, Woodland Hills, California 91367, and our Internet web site address is www.healthnet.com. We make available...

  • Page 4
    ... included our commercial, Medicare and Medicaid health plans, the operations of our HMOs in Connecticut, New York and New Jersey and our New York insurance company. Following the Northeast Sale, our Northeast Operations reportable segment includes the operations of our businesses that are providing...

  • Page 5
    ... desired coverage from a variety of alternatives. Our principal commercial health care products are as follows: • HMO Plans: Our HMO plans offer comprehensive benefits generally through contracts with participating network physicians, hospitals and other providers. When an individual enrolls in...

  • Page 6
    ...health care decisions. Community enrollment and customer service centers in East Los Angeles, California and Modesto, California. The pricing of our products is designed to reflect the varying costs of health care based on the benefit alternatives in our products. We provide employers and employees...

  • Page 7
    ...-alone prescription drug plans ("PDP"), and Medicare supplement products that supplement traditional fee-for-service Medicare coverage. Our subsidiaries have a number of contracts with the Centers for Medicare & Medicaid Services ("CMS") under the Medicare Advantage and PDP programs authorized under...

  • Page 8
    ...-Health Plan Services Membership" for detailed information regarding our Medicaid enrollment. Medi-Cal is a public health insurance program which provides health care services for low-income individuals, and is financed by California and the federal government. As of December 31, 2009, we had Medi...

  • Page 9
    ... enrolled in the Healthy Families Program. California receives two-thirds of the funding for the program from the federal government. Administrative Services Only Business We provide ASO products to large employer groups in California. Under these arrangements, we provide claims processing, customer...

  • Page 10
    ...for the dental services we provide to our Medi-Cal and Healthy Families program enrollees. Government Contracts Segment Our Government Contracts segment includes our TRICARE contract for the North Region and other health care-related government contracts that we administer for the U.S. Department of...

  • Page 11
    ... within five business days for each health care claim run under the North Region contract based on paid claims with an annual reconciliation of the risk sharing provision. We are not responsible for providing most pharmaceutical benefits, claims processing for TRICARE and Medicare dual eligibles and...

  • Page 12
    ...T3 contract for the North Region. On July 20, 2009 we filed a protest with the Government Accountability Office ("GAO") in connection with the T3 award decision made by the TRICARE Management Authority ("TMA") citing a Procurement Integrity Act violation by the Department of Defense in releasing our...

  • Page 13
    ...health care providers in each of the states in which we offer network based managed care products and services. Physician Relationships The following table sets forth the number of primary care and specialist physicians contracted either directly with our HMOs or through our contracted participating...

  • Page 14
    ... access its network providers and pay the claims of these physicians pursuant to the pricing terms of their contracts with the Third Party Network. Hospital Relationships Our health plan subsidiaries arrange for hospital care primarily through contracts with selected hospitals in their service areas...

  • Page 15
    ... the largest PPO provider in California based on number of enrollees. There are also a number of small, regional-based health plans that compete with Health Net in California, mainly in the small business group market segment. In addition, two of the major national managed care companies, Aetna, Inc...

  • Page 16
    our products and services utilizing a three-step process. We first market to potential employer groups, group insurance brokers and consultants. We then provide information directly to employees once the employer has selected our health coverage. Finally, we engage members and employers in marketing...

  • Page 17
    ...associated with outsourcing services and functions to third parties." Medical Management We believe that managing health care costs is an essential function for a managed care company. Among the medical management techniques we utilize to contain the growth of health care costs are pre-authorization...

  • Page 18
    ... of our Medicare Advantage, Private Fee For Service and PDP products and found deficiencies in many of the business areas included in the review. On August 6, 2009, CMS accepted our corrective action plan relating to the 2008 audit. In December 2009, CMS performed a focused audit to assess our...

  • Page 19
    ... agencies that govern these health plans and insurance companies. Company Arizona HMO California HMO Oregon HMO Health Net Life Insurance Company (Arizona and California PPO) MHN Regulatory Agency Arizona Department of Insurance California Department of Managed Health Care Oregon Department of...

  • Page 20
    ... provider claims (including out-of-network claims) and adherence to timely and accurate payment and appeal rules; and Linguistic and cultural accessibility standards, governance requirements and reporting requirements. PPO regulation also varies by state, and while these regulations generally cover...

  • Page 21
    ... adverse effect on our business, financial condition or results of operations." In addition, the federal government is a significant customer of our West Operations segment as a result of our contract with CMS for coverage of Medicare-eligible individuals, including Part D prescription plans, state...

  • Page 22
    ... price of such Right, that number of shares of common stock having a market value of two times such exercise price. In addition, and subject to certain exceptions contained in the Rights Agreement, in the event that we are acquired in a merger or other business combination in which the common stock...

  • Page 23
    ... The United States Senate and House of Representatives passed separate health care reform bills in late 2009. These bills have not yet been reconciled or signed into law. In addition, certain members of Congress have proposed a single-payer health care system, a government health insurance option to...

  • Page 24
    ... minimum medical care ratios, placing a cap on premiums, requiring prior regulatory approval of premium rate increases or otherwise expanding access to health insurance in a manner that could limit the profitability or marketability of our health benefits or managed care products. From time to time...

  • Page 25
    ...changes in our financial results. For example, if medical costs increased by 1% without a proportional change in related revenues for our health plan products, our annual net earnings for 2009 would have been reduced by approximately $107 million. The inability to forecast and manage our health care...

  • Page 26
    ... in which we participate could have an adverse effect on our business, financial condition or results of operations." In July 2009, we were notified by the Department of Defense that we were not selected to by the managed care support contractor under the new T3 North Region contract. Our protest of...

  • Page 27
    ...set premium prices too high, which could result in a loss of membership. If our actual liability for claims payments is higher than estimated, it could have a negative impact on our profitability per enrolled member and, subsequently, our earnings per share in any particular quarter or annual period...

  • Page 28
    ... an adverse effect on our business, financial condition or results of operations. Approximately 51% of our 2009 total revenues relate to federal, state and local government health care coverage programs, such as Medicare, Medicaid and TRICARE. All of the revenues in our Government Contracts segment...

  • Page 29
    ..., particularly as our Medi-Cal membership increases due to current economic conditions. In addition, California could impose requirements on the Medi-Cal program that make continued operations not feasible. Health care operations under our TRICARE North contract are scheduled to conclude on March...

  • Page 30
    ... of our Medicare Advantage, Private Fee For Service and PDP products and found deficiencies in many of the business areas included in the review. On August 6, 2009, CMS accepted our corrective action plan relating to the 2008 audit. In December 2009, CMS performed a focused audit to assess our...

  • Page 31
    ... policies that may provide coverage for some of the potential liabilities relating to litigation matters, there can be no assurance that coverage will be available for any particular case or liability. Insurers could dispute coverage or the amount of insurance could not be sufficient to cover...

  • Page 32
    ... in some cases, institutional services. Provider groups that enter into capitation fee arrangements generally contract with specialists and other secondary providers, and may contract with primary care physicians, to provide services. The inability of provider groups to properly manage costs under...

  • Page 33
    ... effectively in our markets, we also must deliver products and services that demonstrate value to our customers and that are designed and priced properly and competitively. The adverse economic conditions could also cause employers to stop offering certain health care coverage as an employee benefit...

  • Page 34
    ... and financial results. In addition, state and federal budgetary pressures could cause new or higher levels of assessments or taxes for our commercial programs, such as surcharges on select fee-for-service and capitated medical claims or premium taxes on insurance companies and health maintenance...

  • Page 35
    ... and paid. For additional information on the United Administrative Services Agreements, see "Item 1. Business-Segment Information-Northeast Operations". Under the agreements that govern the Northeast Sale, we have retained responsibility for certain liabilities of the acquired business, which could...

  • Page 36
    ... lenders to reduce and in some cases cease to provide funding to borrowers. If markets remain tight, they may materially and adversely affect our ability to access additional capital to meet liquidity needs, which could have an adverse effect on our financial condition and results of operations. The...

  • Page 37
    ..., Health Net of California and Health Net Life Insurance Company. Moody's Investors Service also announced on the same day that it had placed the Company's "Ba3" senior debt ratings under review for possible downgrade, also due to the loss of the T3 North Region contract. For additional detail...

  • Page 38
    ..., Health Net of California and Health Net Life Insurance Company. Moody's Investors Service also announced on the same day that it had placed the Company's "Ba3" senior debt ratings under review for possible downgrade, also due to the loss of the T3 North Region contract. For additional detail...

  • Page 39
    ... include HMOs, PPOs, self-funded employers, insurance companies, hospitals, health care facilities and other health care providers. In addition, other companies may enter our markets in the future. In addition, financial services or other technology-based companies could enter the market and...

  • Page 40
    ...processed by our information management systems assists us in, among other things, pricing our services, monitoring utilization and other cost factors, processing provider claims, billing our customers on a timely basis and identifying accounts for collection. Our customers and providers also depend...

  • Page 41
    ...obligated to provide administrative services in connection with the wind-down and run-off of the acquired business, which exposes us to operational and financial risks" and "- Under the agreements that govern the Northeast Sale, we have retained responsibility for certain liabilities of the acquired...

  • Page 42
    ... Regulation" for additional information on the federal and state regulations that govern how we conduct our business. Despite the security measures we have in place to ensure compliance with applicable laws and rules, our facilities and systems, and those of our third party service providers, may be...

  • Page 43
    ...broker compensation arrangements and bid quoting practices. We market our products and services both through sales people employed by us and through independent sales agents. Independent sales agents typically do not work with us on an exclusive basis and may market health care products and services...

  • Page 44
    ... public communications regarding managed care, legislative or regulatory actions, health care reform, litigation or threatened litigation, health care cost trends, pricing trends, competition, earnings, receivable collections or membership reports of particular industry participants, and market...

  • Page 45
    ... have a material adverse effect on our business, financial condition and results of operations. Item 1B. Unresolved Staff Comments. None. Item 2. Properties. We lease office space for our principal executive offices in Woodland Hills, California. Our executive offices, comprising approximately 125...

  • Page 46
    .... Preliminary motions and exceptions have been filed by the receivers for AmCare-TX, AmCare-OK and AmCare-LA seeking dismissal of our claim for nullification on various grounds. The federal judge dismissed Health Net's federal complaint and Health Net appealed to the U.S. Fifth Circuit Court...

  • Page 47
    ... applicable to our business, including, without limitation, rules relating to pre-authorization penalties, payment of out-of-network claims and timely review of grievances and appeals, which may result in remediation of certain claims and the assessment of regulatory fines or penalties. In addition...

  • Page 48
    ... to pay dividends depends on distributions received from our subsidiaries, which are subject to regulatory net worth requirements and additional state regulations which may restrict the declaration of dividends by HMOs, insurance companies and licensed managed health care plans. The payment of...

  • Page 49
    ... our stock repurchase program was on hold as a consequence of the uncertain financial environment and the announcement by Health Net's Board of Directors that Jay Gellert, our President and Chief Executive Officer, would be undertaking a review of the Company's strategic direction. On July 20, 2009...

  • Page 50
    The following table presents monthly information related to repurchases of our common stock, including shares withheld by the Company to satisfy tax withholdings and exercise price obligations in 2009, as of December 31, 2009: Maximum Number (or Approximate Dollar Value) of Shares (or Units) that ...

  • Page 51
    ....99 All historical performance data reflects the performance of each Company's own stocks only and does not include the historical performance data of acquired companies. The preceding graph and related information are being furnished solely to accompany this Annual Report on Form 10-K pursuant to...

  • Page 52
    ...' equity (2) ...OPERATING DATA: Pretax margin ...Health plan services medical care ratio (MCR) . . Government contracts cost ratio ...G&A expense ratio ...Selling costs ratio ...Health plan services premiums per member per month (PMPM) ...Health plan services costs PMPM ...Net cash provided by (used...

  • Page 53
    ... our own health plan members. Our subsidiaries also offer managed health care products related to prescription drugs, and offer managed health care product coordination for multi-region employers and administrative services for medical groups and self-funded benefits programs. How We Report Our...

  • Page 54
    ... health maintenance organization (HMO), point of service (POS) and preferred provider organization (PPO) premiums from employer groups and individuals and from Medicare recipients who have purchased supplemental benefit coverage (which premiums are based on a predetermined prepaid fee), Medicaid...

  • Page 55
    ... could pay us additional consideration as our Northeast commercial members, Medicare and/or Medicaid businesses transition to other United products to the extent such amounts exceed the initial minimum payment of $60 million (referred to as contingent membership renewal). Our current estimate of...

  • Page 56
    ... loss was $(53.9) million in 2009 compared to pretax income of $16.9 million in 2008. Government Contracts segment pretax income was $165.0 million and $132.7 million for the years ended December 31, 2009 and 2008, respectively; and Net cash provided by operating activities totaled $247.5 million...

  • Page 57
    ...Net income per share: Basic ...$ Diluted ...$ Pretax margin ...Health plan services medical care ratio (MCR) (a) ...Government contracts cost ratio (b) ...G&A expense ratio (c) ...Selling costs ratio (d) ...Health plan services premiums per member per month (PMPM) (e) ...$ Health plan services costs...

  • Page 58
    ... lawsuits, which were nationwide class actions principally relating to our out-of-network claims payment practices. $37.5 million recorded as part of health plan services expenses for estimated litigation and regulatory actions related to the Company's rescission practices in Arizona and California...

  • Page 59
    ...Medicare Advantage members. Our TRICARE membership increased to approximately 3.0 million beneficiaries at December 31, 2008 from 2.9 million beneficiaries at December 31, 2007. Health Net's total revenues increased 9% in 2008 to $15.4 billion from $14.1 billion in 2007. Health plan services premium...

  • Page 60
    ... by program and by state: Commercial 2009 2008 2007 ASO1 Medicare Medicaid 2009 2008 2007 2009 2008 2007 2009 2008 2007 (Membership in thousands) Health Plan Total 2009 2008 2007 Arizona ...96 123 137 - - - California ...1,227 1,352 1,468 5 5 6 Connecticut ...19 139 161 1 25 32 New Jersey ...2 73...

  • Page 61
    ... acceptance of our corrective action plan and our demonstrated correction of the deficiencies. This temporary suspension did not have a material adverse effect on our Medicare business. In 2007 and 2008, we participated in state Medicaid programs in California, New Jersey and Connecticut. California...

  • Page 62
    ... 31, 2009 2008 2007 (Dollars in millions, except PMPM data) Health plan services: Commercial premium revenue ...Medicare premium revenue ...Medicaid premium revenue ...Health plan services premium revenues ...Health plan services costs ...Net investment income ...Administrative services fees and...

  • Page 63
    ... 31, 2008 and 2007, respectively. Partially offsetting the decrease in Medicaid premiums from the cessation of the Connecticut program was a $19 million increase from a change in estimate due to revised application of California Medi-Cal program premium rates for 2001 and 2002 plan years. 61

  • Page 64
    ... due to our withdrawal from the Connecticut Medicaid program in April 2008. Health Plan Services Costs Health plan services costs decreased by $30.7 million, or less than 1% for the year ended December 31, 2009 as compared to the same period in 2008, and increased by $999.8 million, or 10%, for...

  • Page 65
    ...Medicaid health care cost PMPM was 4% for the year ended December 31, 2009 over the same period in 2008. These increases were primarily driven by physician and hospital costs. Medicaid MCR increased by 270 basis points for the year ended December 31, 2009. Northeast Operations Commercial health care...

  • Page 66
    ...2007. These decreases were primarily driven by lower outpatient hospital and pharmacy costs and utilization. Medicaid MCR increased by 60 basis points for the year ended December 31, 2008. West Operations Commercial health care costs increased by $274.3 million, or 6%, for the year ended December 31...

  • Page 67
    ... a $10.0 million payment received from the California Department of Health Services for interest on a premium rate settlement, partially offset by a $11.3 million decrease in ASO revenues primarily due to ASO membership declines due to the sale of our Northeast health plan subsidiaries. Year Ended...

  • Page 68
    ...TRICARE Prime under our North Region contract. In addition to the 3.1 million eligible beneficiaries that we service under the TRICARE contract for the North Region, we administer contracts with the U.S. Department of Veterans Affairs to manage community based outpatient clinics in 8 states covering...

  • Page 69
    ... due to an increase in health care services provided under a new option year in the TRICARE contract, Option Period 6, and growth in the family counseling business with the DoD. Our TRICARE contract for the North Region includes a target cost and price for reimbursed health care costs, which is...

  • Page 70
    ... to the same period in 2007 primarily due to increased costs of health care services provided under Option Period 5 in the TRICARE contract. Asset Impairment, Loss on Sale of Northeast Health Plan Subsidiaries and Other Charges 2009 Charges We recorded $404.4 million pretax, or $280.9 million...

  • Page 71
    ... delay or cancel plans to purchase our products, may reduce the number of individuals to whom they provide coverage, or may make changes in the mix or products purchased from us. In addition, if our customers experience financial issues, they may not be able to pay, or may delay payment of, accounts...

  • Page 72
    ... in estimated net asset value we had invested in The Reserve money market funds from cash equivalents to investments available-for-sale. As of December 31, 2008, we held $50.4 million in the Reserve Primary Institutional Fund and $69.2 million in the Reserve U.S. Government Fund. On January 16, 2009...

  • Page 73
    ... operating activities, existing working capital, lines of credit and cash reserves are adequate to allow us to fund existing obligations, repurchase shares under our stock repurchase program, introduce new products and services, and continue to develop health care-related businesses. We regularly...

  • Page 74
    ... our stock repurchase program was on hold as a consequence of the uncertain financial environment and the announcement by Health Net's Board of Directors that Jay Gellert, our President and Chief Executive Officer, was undertaking a review of the Company's strategic direction. On July 20, 2009, we...

  • Page 75
    ... entering into the Stock Purchase Agreement for the sale of our Northeast business. On December 8, 2009, we announced that our Board of Directors has authorized the Company to resume repurchases of its common stock under the existing stock repurchase program. We repurchased 860,737 shares of our...

  • Page 76
    ... to the date of repurchase. As of December 31, 2009, we were in compliance with all of the covenants under the indenture governing the Senior Notes. The Senior Notes may be redeemed in whole at any time or in part from time to time, prior to maturity at our option, at a redemption price equal to...

  • Page 77
    ... in certain mergers, consolidations and acquisitions; sell or transfer assets; enter into agreements which restrict the ability to pay dividends or make or repay loans or advances; make investments, loans, and advances; engage in transactions with affiliates; and make dividends. In addition, we are...

  • Page 78
    ... to the Stock Purchase Agreement relating to the Northeast Sale, we have agreed to contribute additional capital to the Acquired Companies to meet statutory capital requirements as required by governmental authorities. The amount of such contributions, if any, will be added to the payments we are...

  • Page 79
    ...-term agreements to receive services related to pharmacy benefit management, pharmacy claims processing services and health quality/risk scoring enhancement services with external thirdparty service providers. The remaining terms are approximately three years for each of these contracts. Termination...

  • Page 80
    ...have entered into with our health care providers, health care facilities, the federal government and other contracts that we have entered into for the purpose of providing health care services. We have excluded those contracts that allow for cancellation without significant penalty, obligations that...

  • Page 81
    ... services premium revenues include HMO, POS and PPO premiums from employer groups and individuals and from Medicare recipients who have purchased supplemental benefit coverage (for which premiums are based on a predetermined prepaid fee), Medicaid revenues based on multi-year contracts to provide...

  • Page 82
    ... estimates reserves for claims based upon the historical lag between the month when services are rendered and the month claims are paid while taking into consideration, among other things, expected medical cost inflation, seasonal patterns, product mix, benefit plan changes and changes in membership...

  • Page 83
    ...to health care services or in the month in which the administrative services are performed or the period that coverage for services is provided. Under our TRICARE contract for the North Region we recognize amounts receivable and payable under the government contracts related to estimated health care...

  • Page 84
    ... in various disputes with members, health care providers, and other entities, as well as audits by government agencies that relate to our services and/or business practices that expose us to potential losses. We recognize an estimated loss, which may represent damages, settlement costs, future legal...

  • Page 85
    .... Additionally, upon classifying the Acquired Companies' assets and liabilities as held for sale we ceased recording amortization expense related to these intangible assets. On December 11, 2009, we completed the Northeast Sale (See Note 3 to the consolidated financial statements for information...

  • Page 86
    .... In addition, we are exposed to the risk of loss related to changes in credit spreads. Credit spread risk arises from the potential changes in an issuer's credit rating or credit perception that will affect the value of financial instruments. We attempt to manage the interest rate risks related to...

  • Page 87
    ... the security with securities of publicly traded companies in a similar line of business, and reviewing the underlying financial performance including estimating discounted cash flows. The following table presents the expected cash outflows relating to market risk sensitive debt obligations as of 85

  • Page 88
    ..., summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate, to allow timely decisions regarding required...

  • Page 89
    ...user services, data network services, voice network services and cross functional services, to a third party. This IT infrastructure outsourcing was completed in February 2009, except for the data center migration, which was completed in all material respects as it relates to the Company's financial...

  • Page 90
    ... FIRM To the Board of Directors and Stockholders of Health Net, Inc. Woodland Hills, California We have audited the internal control over financial reporting of Health Net, Inc., and subsidiaries ("the Company") as of December 31, 2009, based on criteria established in Internal Control-Integrated...

  • Page 91
    Item 9B. Other Information. None. 89

  • Page 92
    ... Annual CEO Certification required pursuant to Section 303A.12(a) of the New York Stock Exchange Listed Company Manual. We have adopted a Code of Business Conduct and Ethics that applies to our employees, directors and officers, including our principal executive officer, principal financial officer...

  • Page 93
    ... as part of this Annual Report on Form 10-K. 2. Financial Statement Schedules The financial statement schedules listed on the accompanying Index to Consolidated Financial Statements set forth on page F-1 and covered by the Report of Independent Registered Public Accounting Firm are incorporated into...

  • Page 94
    ... duly authorized. HEALTH NET, INC. By: /s/ JOSEPH C. CAPEZZA Joseph C. Capezza Chief Financial Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates...

  • Page 95
    ... statements and financial statement schedules are filed as part of this Annual Report on Form 10-K: Consolidated Financial Statements Report of Independent Registered Public Accounting Firm ...Consolidated Statements of Operations for each of the three years in the period ended December 31, 2009...

  • Page 96
    ...of Directors and Stockholders of Health Net, Inc. Woodland Hills, California We have audited the accompanying consolidated balance sheets of Health Net, Inc. and subsidiaries (the "Company") as of December 31, 2009 and 2008, and the related consolidated statements of operations, stockholders' equity...

  • Page 97
    HEALTH NET, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands, except per share data) 2009 Year Ended December 31, 2008 2007 Revenues Health plan services premiums ...Government contracts ...Net investment income ...Administrative services fees and other income ...Total revenues ......

  • Page 98
    ... for sale (amortized cost: 2009-$1,372,090, 2008- $1,516,316) ...Premiums receivable, net of allowance for doubtful accounts (2009-$6,283, 2008-$13,567) ...Amounts receivable under government contracts ...Incurred but not reported (IBNR) health care costs receivable under TRICARE North contract...

  • Page 99
    ... income: Net income ...Change in unrealized loss on investments, net of tax impact of $5,738 ...Defined benefit pension plans: Prior service cost and net loss ...2,657 133 (3) $144 Total comprehensive income ... Exercise of stock options ...Share-based compensation expense ...Tax benefit related...

  • Page 100
    ... related to the acquisition of businesses ...Sales (purchases) of restricted investments and other ...Net cash used in investing activities ...CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from exercise of stock options and employee stock purchases ...Excess tax benefit on share-based compensation...

  • Page 101
    ... the Medicare prescription drug benefit commonly referred to as "Part D"), Medicaid and TRICARE programs. Our subsidiaries also offer managed health care products related to behavioral health and prescription drugs. We also own health and life insurance companies licensed to sell exclusive provider...

  • Page 102
    ...services premium revenues include HMO, POS and PPO premiums from employer groups and individuals and from Medicare recipients who have purchased supplemental benefit coverage, for which premiums are based on a predetermined prepaid fee, Medicaid revenues based on multi-year contracts to provide care...

  • Page 103
    ..., we provide claims processing, customer services, medical management, provider network access and other administrative services. Administrative services fees are recognized as revenue in the period services are provided. Health Care Services and Government Contract Expenses The cost of health care...

  • Page 104
    ... Medicare Advantage Plans or Medicare supplemental plans. MAPD covers both prescription drugs and medical care. The majority of our Part D members in the PDP fall into the low-income category. Health Net has two primary contracts under Part D, one with the Centers for Medicare and Medicaid Services...

  • Page 105
    ... on the member's income level in relation to the Federal Poverty Level. Health Net receives prospective payments on a monthly basis, and they represent a cost reimbursement that is finalized and settled after the end of the year. The low-income member cost sharing subsidy is accounted for as...

  • Page 106
    ... Federal Government regarding prior Option Period 1 health care cost targets. The administrative price is paid on a monthly basis, one month in arrears and certain components of the administrative price are subject to volumebased adjustments. Share-Based Compensation Expense As of December 31, 2009...

  • Page 107
    ... observable market information. Such valuation methodologies include reviewing the value ascribed to the most recent financing, comparing the security with securities of publicly traded companies in a similar line of business, and reviewing the underlying financial performance including estimating...

  • Page 108
    ... acquired and the excess of the cost of the acquisitions over the tangible and intangible assets acquired and liabilities assumed (goodwill). Identifiable intangible assets primarily consist of the value of employer group contracts, provider networks and customer relationships, which are all subject...

  • Page 109
    ...Northeast Operations and Government Contracts (See Note 14 to our consolidated financial statements for more information on our segment changes). Also, at the time we entered into the Stock Purchase Agreement, it became more likely than not that the Acquired Companies would be sold within a year. As...

  • Page 110
    .... Additionally, upon classifying the Acquired Companies' assets and liabilities as held for sale we ceased recording amortization expense related to these intangible assets. On December 11, 2009, we completed the Northeast Sale (see Note 3 to the consolidated financial statements for information...

  • Page 111
    ... such insurance coverage. The Company also maintains litigation reserves to cover those self-insured retention amounts for errors and omissions claims based on historical claims filed, as well as estimates of claims incurred but not reported. Concentrations of Credit Risk Financial instruments that...

  • Page 112
    ... our stock repurchase program was on hold as a consequence of the uncertain financial environment and the announcement by Health Net's Board of Directors that Jay Gellert, our President and Chief Executive Officer, was undertaking a review of the Company's strategic direction. On July 20, 2009, we...

  • Page 113
    ... 1.5 0.4 $ (6.9) Taxes Based on Premiums We provide services in certain states, which require premium taxes to be paid by us based on membership or billed premiums. These taxes are paid in lieu of or in addition to state income taxes and totaled $75.7 million in 2009, $48.0 million in 2008 and $43...

  • Page 114
    ... in the States of New York, New Jersey, Connecticut and Rhode Island for a period of five years, and certain other restrictive covenants. We retained the renewal rights and our ability to sell our stand-alone PDP products in Connecticut and New Jersey through Health Net Life Insurance Company. We...

  • Page 115
    ... related to the sale of the Acquired Companies, which is reported as a separate line item on our consolidated statement of operations for the year ended December 31, 2009. Prior to the consummation of the sale of the Acquired Companies, we classified the Acquired Companies' assets and liabilities...

  • Page 116
    ... approximately 565,000 total health plan members in the Northeast Operations. On December 11, 2009, the closing date of the Northeast Sale, we had approximately 462,000 total health plan members in the Northeast Operations. Purchase of The Guardian Life Insurance Company of America's (The Guardian...

  • Page 117
    HEALTH NET, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) the credit loss in the amount of $60,000 during the second quarter of the year ended December 31, 2009. This amount represents the difference between the present value of the Company's best estimate of future cash flows using ...

  • Page 118
    HEALTH NET, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) 2008 Gross Gross Unrealized Unrealized Holding Holding Gains Losses (Dollars in millions) Amortized Cost Carrying Value Asset-backed securities ...U.S. government and agencies ...Obligations of states and other political ...

  • Page 119
    ... shows the number of our individual securities-current that have been in a continuous loss position at December 31, 2009: Less than 12 Months 12 Months or More Total Asset-backed securities ...U.S. government and agencies ...Obligation of states and other political subdivisions ...Corporate debt...

  • Page 120
    HEALTH NET, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) The following table shows the number of our individual securities-noncurrent that have been in a continuous loss position at December 31, 2009: Less than 12 Months 12 Months or More Total Asset-backed securities ...U.S. ...

  • Page 121
    ...; engage in certain mergers, consolidations and acquisitions; engage in transactions with affiliates; enter into agreements which will restrict the ability of our subsidiaries to pay dividends or other distributions with respect to any shares of capital stock or the ability to make or repay loans or...

  • Page 122
    ...interest to the date of repurchase. As of December 31, 2009, no default or event of default had occurred under the indenture governing the Senior Notes. The Senior Notes may be redeemed in whole at any time or in part from time to time, prior to maturity at our option, at a redemption price equal to...

  • Page 123
    ... in certain mergers, consolidations and acquisitions; sell or transfer assets; enter into agreements which restrict the ability to pay dividends or make or repay loans or advances; make investments, loans, and advances; engage in transactions with affiliates; and make dividends. In addition, we are...

  • Page 124
    ..., even in situations where we hold a large position and a sale could reasonably impact the quoted price. Level 2-Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date, and fair value is determined through the use of...

  • Page 125
    ... statement for share-based compensation arrangements was $4.5 million (See Note 2). The Plans permit the grant of stock options and other equity awards, including but not limited to restricted stock, restricted stock units (RSUs) and performance share units (PSUs) to certain employees, officers...

  • Page 126
    ... number of shares of common stock available for issuance under the 2006 Long-Term Incentive Plan by two shares of common stock. Stock options are granted with an exercise price at or above the fair market value of the Company's common stock on the date of grant. Effective May 21, 2009, stock option...

  • Page 127
    HEALTH NET, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) A summary of option activity under our various plans as of December 31, 2009, and changes during the year then ended is presented below: Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Number...

  • Page 128
    HEALTH NET, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) A summary of RSU and PSU activity under our various plans as of December 31, 2009, and changes during the year then ended is presented below: Number of Restricted Stock Units and Performance Share Units Weighted Average Grant-...

  • Page 129
    ... price of such Right, that number of shares of common stock having a market value of two times such exercise price. In addition, and subject to certain exceptions contained in the Rights Agreement, in the event that we are acquired in a merger or other business combination in which the common stock...

  • Page 130
    ... our stock repurchase program was on hold as a consequence of the uncertain financial environment and the announcement by Health Net's Board of Directors that Jay Gellert, our President and Chief Executive Officer, was undertaking a review of the Company's strategic direction. On July 20, 2009, we...

  • Page 131
    ... defined benefit health care and life insurance plans that provide postretirement medical and life insurance benefits to directors, key executives, employees and dependents who meet certain eligibility requirements. The Health Net health care plan is non-contributory for employees retired prior to...

  • Page 132
    ... STATEMENTS-(Continued) The following table sets forth the plans' obligations and funded status at December 31: Other Benefits Pension Benefits 2009 2008 2009 2008 (Dollars in millions) Change in benefit obligation: Benefit obligation, beginning of year ...Service cost ...Interest cost ...Benefits...

  • Page 133
    ... of net periodic benefit cost recognized in our consolidated statements of operations as general and administrative expense for years ended December 31: Pension Benefits Other Benefits 2009 2008 2007 2009 2008 2007 (Dollars in millions) Service Cost ...Interest Cost ...Amortization of prior service...

  • Page 134
    ... CONSOLIDATED FINANCIAL STATEMENTS-(Continued) Assumed health care cost trend rates have a significant effect on the amounts reported for the health care plans. A one-percentage-point change in assumed health care cost trend rates would have the following effects for the year ended December 31, 2009...

  • Page 135
    ...31: 2009 2008 2007 Statutory federal income tax rate ...State and local taxes, net of federal income tax effect ...Tax exempt interest income ...Goodwill impairment ...Fines and penalties ...Class action lawsuit expenses ...Valuation allowance against net operating losses and tax credits ...Sale of...

  • Page 136
    ... prior acquisition were realized. The subsidiary to which this valuation allowance related was sold during 2009, therefore, no portion of the 2009 valuation allowance remains that would be allocated to reduce goodwill. We maintain a liability for unrecognized tax benefits that includes the estimated...

  • Page 137
    ... the Knox-Keene Health Care Service Plan Act of 1975, as amended, California plans must comply with certain minimum capital or tangible net equity requirements. Our non-California health plans, as well as our insurance companies, must comply with their respective state's minimum regulatory capital...

  • Page 138
    HEALTH NET, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) plans to AmCareco, Inc. (AmCareco). We retained a minority interest in the three plans after the sale. Thereafter, the three plans became known as AmCare of Louisiana (AmCare-LA), AmCare of Oklahoma (AmCare-OK) and AmCare of ...

  • Page 139
    ... applicable to our business, including, without limitation, rules relating to pre-authorization penalties, payment of out-of-network claims and timely review of grievances and appeals, which may result in remediation of certain claims and the assessment of regulatory fines or penalties. In addition...

  • Page 140
    ...-term agreements to receive services related to pharmacy benefit management, pharmacy claims processing services and health quality/risk scoring enhancement services with external thirdparty service providers. The remaining terms are approximately three years for each of these contracts. Termination...

  • Page 141
    ... our health care providers and facilities, the federal government, other IT service companies and other parties within the normal course of our business for the purpose of providing health care services. Certain of these contracts are cancelable with substantial penalties. As of December 31, 2009...

  • Page 142
    ... criteria Similar managed health care products and services including HMO, PPO and POS, Similar production process as they support similar customer groups and products, Same type of customers, individuals within large and small employer groups and senior and commercial individuals, Similar...

  • Page 143
    ... Operations Government Contracts Eliminations (Dollars in millions) Total Revenues from external sources ...Intersegment revenues ...Net investment income ...Administrative services fees and other income ...Interest expense ...Depreciation and amortization ...Share-based compensation expense...

  • Page 144
    HEALTH NET, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) Our health plan services premium revenue by line of business is as follows: Year Ended December 31, 2009 2008 2007 (Dollars in millions) Commercial premium revenue ...Medicare Risk premium revenue ...Medicaid premium revenue ...

  • Page 145
    .... (b) Includes medical claims only. Capitation, pharmacy and other payments including provider settlements are not included. (c) This line represents the change in reserves attributable to the difference between the original estimate of incurred claims for prior years and the revised estimate. In...

  • Page 146
    ... 31, 2009, 2008 and 2007, the Company's capitated, shared risk, pharmacy and other expenses represented 41%, 41% and 41%, respectively, of the Company's total health plan services. Note 16-Quarterly Information (Unaudited) The following interim financial information presents the 2009 and 2008...

  • Page 147
    ..., and $(39) million of government contracts cost due to TRICARE estimated health care cost adjustments for the quarters ended March 31, June 30, September 30, and December 31, 2008, respectively. (8) Includes $19 million of 2001-2002 California Medi-Cal premium rate adjustments in the quarter ended...

  • Page 148
    ...I CONDENSED FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY ONLY) HEALTH NET, INC. CONDENSED STATEMENTS OF OPERATIONS (Amounts in thousands) Year Ended December 31, 2009 2008 2007 As restated See Note 2 REVENUES: Net investment (loss) income ...Other income (loss) ...Administrative service fees...

  • Page 149
    SUPPLEMENTAL SCHEDULE I CONDENSED FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY ONLY) HEALTH NET, INC. CONDENSED BALANCE SHEETS (Amounts in thousands) December 31, 2009 December 31, 2008 As restated See Note 2 ASSETS Current Assets: Cash and cash equivalents ...Investment-available for sale ...

  • Page 150
    SUPPLEMENTAL SCHEDULE I CONDENSED FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY ONLY) HEALTH NET, INC. CONDENSED STATEMENTS OF CASH FLOWS (Amounts in thousands) Year Ended December 31, 2008 2007 2009 NET CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES ...$ 125,872 CASH FLOWS FROM ...

  • Page 151
    SUPPLEMENTAL SCHEDULE I CONDENSED FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY ONLY) HEALTH NET, INC. NOTE TO CONDENSED FINANCIAL STATEMENTS Note 1-Basis of Presentation Health Net, Inc.'s (HNT) investment in subsidiaries is stated at cost plus equity in undistributed earnings (losses) of ...

  • Page 152
    SUPPLEMENTAL SCHEDULE I CONDENSED FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY ONLY) HEALTH NET, INC. NOTE TO CONDENSED FINANCIAL STATEMENTS-(Continued) The following table summarizes the restatement adjustments and their impact on our condensed balance sheet as previously reported for the ...

  • Page 153
    ... SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS AND RESERVES HEALTH NET, INC. (Amounts in thousands) Balance at Beginning of Period Charged to Costs and Expenses Credited to Other Accounts (1) Deductions Northeast entities sold Balance at End of Period 2009: Allowance for doubtful accounts: Premiums...

  • Page 154
    ... ^2.1 Stock Purchase Agreement, dated as of July 20, 2009, by and among Health Net, Inc., Health Net of the Northeast, Inc., Oxford Health Plans, LLC and solely with respect to section 8.16 thereof, UnitedHealth Group Incorporated (filed as Exhibit 2.1 to the Company's Quarterly Report on Form 10...

  • Page 155
    ... Long-Term Incentive Plan, as amended, a copy of which is filed herewith. Form of Nonqualified Stock Option Agreement utilized for eligible employees of Health Net, Inc. (filed as Exhibit 10.4 to the Company's Current Report on Form 8-K filed with the Commission on January 21, 2009 (File No. 1-12718...

  • Page 156
    ... Form of Performance Share Award Agreement utilized for eligible employees of Health Net, Inc. (filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed with the Commission on February 21, 2008 (File No. 1-12718) and incorporated herein by reference). Form of Nonqualified Stock Option...

  • Page 157
    ... 1, 2009, a copy of which is filed herewith. Health Net, Inc. (formerly Foundation Health Systems, Inc.) Deferred Compensation Plan Trust Agreement effective September 1, 1998 between Foundation Health Systems, Inc. and Union Bank of California (filed as Exhibit 10.31 to the Company's Annual Report...

  • Page 158
    ...-Employee Director Stock Option Plan (filed as Exhibit 10.31 to Registration Statement on Form S-4 (File No. 33-86524) on November 18, 1994 and incorporated herein by reference). Health Net, Inc. Management Incentive Plan, adopted December 2004 (filed as Exhibit 10.40 to the Company's Annual Report...

  • Page 159
    ... and Restated Health Net, Inc. Supplemental Executive Retirement Plan effective as of January 1, 2008 (filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed December 9, 2008 (File No. 1-12718) and incorporated herein by reference). Amended and Restated Deferred Compensation Plan of...

  • Page 160
    ... Exhibit 10.65 to the Company's Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 1-12718) and incorporated herein by reference). Standard Form Office Lease, dated July 13, 2009, by and between Aerojet-General Corporation and Health Net Federal Services, LLC, a copy of which...

  • Page 161
    ..., a copy of which is filed herewith. Office Lease Agreement, dated August 18, 2000, by and between Physicians Health Services of Connecticut, Inc. (predecessor to Health Net of Connecticut, Inc.) and Beard Sawmill, LLC (filed as Exhibit 10.68 to the Company's Annual Report on Form 10-K for the year...

  • Page 162
    ..., by and between San Rafael Land Company, LLC and Managed Health Network, Inc., a copy of which is filed herewith. Office Lease, dated March 18, 2009, by and between GK Triangle Corporate Park III, LLC and Health Net Health Plan of Oregon, Inc., a copy of which is filed herewith. First Amendment to...

  • Page 163
    ... is filed herewith. * Management contract or compensatory plan or arrangement required to be filed (and/or incorporated by reference) as an exhibit to this Annual Report on Form 10-K pursuant to Item 15(c) of Form 10-K. †A copy of the exhibit is being filed with this Annual Report on Form 10...

  • Page 164
    ...to Stock Purchase Agreement (this "Amendment") effective as of December 11, 2009, is entered into by and among Health Net, Inc., a Delaware corporation ("Parent"), Health Net of the Northeast, Inc., a Delaware corporation (the "Seller"), Oxford Health Plans, LLC, a Delaware limited liability company...

  • Page 165
    ... an actuarially determined provision for medical costs and loss adjustment expenses as of the ASA Termination Date for all claims through the winding up and running out period of the Acquired Business; provided, however, that the Termination Date Combined Financial Statement shall not include any...

  • Page 166
    ... to any net income or loss for a period during the 2011 Medicare Revenue Period shall equal the product of (x) the 2011 PMPM Amount, multiplied by (y) the average number of members under the Medicare Revenue Contract for the 2011 Medicare Revenue Period, multiplied by (z) the number of months (or...

  • Page 167
    ...the resolution of any disputes between the parties with respect to (i) the preparation of the Initial Membership Statement, any Membership Renewal Statement, the 2010 Medicare Actual Income Statement, the Medicaid Statement of Revenues, the Closing Date Combined Balance Sheet, any Quarterly Combined...

  • Page 168
    ... applicable, or, if Buyer has made the Buyer Medicaid Election, after June 30, 2010, (ii) claims attributable to the business under the Medicare Revenue Contract with occurrence dates after the Closing Date and through December 31, 2010, taking into account Seller's entitlement to and liability for...

  • Page 169
    ... Law. The internal law, without regard to conflicts of laws principles, of the State of New York shall govern all questions concerning the construction, validity and interpretation of this Amendment and the performance of the obligations imposed by this Amendment. [SIGNATURE PAGE FOLLOWS] -6-

  • Page 170
    ..., Seller and UHG have caused this Amendment to be signed by their respective duly authorized officers as of the date first above written. HEALTH NET, INC. /s/ Jay M. Gellert By: Jay M. Gellert Its: President and Chief Executive Officer HEALTH NET OF THE NORTHEAST, INC. /s/ Paul Lambdin By: Paul...

  • Page 171
    OXFORD HEALTH PLANS, LLC /s/ Jeffrey D. Alter By: Jeffrey D. Alter Its: President and Chief Executive Officer UNITEDHEALTH GROUP INCORPORATED /s/ G. Mike Mikan By: G. Mike Mikan Its: Executive Vice President and Chief Financial Officer

  • Page 172
    ...be greater than *** of pre-tax income or loss) as reflected on the 2010 Medicare Estimated Income Statement; provided that, such amounts shall be pro-rated based on the actual number of days commencing on the later of January 1, 2010 and the day after the Closing Date and ending on December 31, 2010...

  • Page 173
    ... in good faith by the parties based on the parameters set forth in this definition. "Medicare Revenue Contract" means the Contract H0755, effective as of October 6, 2005, by and between CMS and Health Net of Connecticut (or any successor contracts thereto as the same may have been renewed prior to...

  • Page 174
    ... Days prior to the Closing Date, Seller shall deliver to Buyer (A) the 2010 Medicare Estimated Income Statement and the calculations of the 2010 Estimated Medicare Revenue-Based Payment Amount and the 2010 Estimated Medicare Profit/Loss Amount, and (B) a certificate of a duly authorized officer of...

  • Page 175
    ... and Seller shall continue to administer the business related to the Medicare Revenue Contract pursuant to the applicable Administrative Services Agreements in accordance with the terms of the 2011 Medicare Bid, including, without limitation, the 2011 Operating Costs, and (2) Buyer shall prepare and...

  • Page 176
    ...as of December 14, 2009 (the "Effective Date"), by and between Health Net, Inc., a Delaware corporation (the "Company"), with its principal place of business located at 21650 Oxnard Street, Woodland Hills, California 91367, and Angelee F. Bouchard ("Executive"). This Agreement amends and restates in...

  • Page 177
    ... option agreement, restricted stock agreement, restricted stock unit agreement, performance share agreement and/or severance agreement Executive enters into with the Company from time to time (collectively, "Personal Compensation Information"), may be disclosed in filings with the SEC, the New York...

  • Page 178
    ..., services, prices, margins and costs; (iii) confidential financial information; (iv) personnel information (including without limitation employee compensation); and (v) other confidential business information. B. Executive further agrees that at all times during Executive's employment and...

  • Page 179
    ... as Executive remains employed by the Company and Executive meets the applicable participation requirements. These benefit programs and plans currently include paid time off ("PTO"), holidays, group medical, dental, vision, term life, and short and long term disability insurance and participation in...

  • Page 180
    ... documented costs incurred for personal financial counseling services provided to Executive, including tax preparation, as long as Executive remains employed by the Company. D. Incentive Bonus. Executive will be eligible to participate in the Health Net, Inc. Executive Officer Incentive Plan ("EOIP...

  • Page 181
    ... closing sales price of the Company's Common Stock on an annual basis, (2) any changes in Executive's Base Salary made pursuant to and in accordance with Section 1B of this Agreement, and (3) any changes under the terms of the Executive Stock Ownership Policy. Any shares of Company Common Stock that...

  • Page 182
    ... to the effective date of Executive's employment: (i) Any person (as such term is defined under Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")), corporation or other entity (other than Health Net, Inc. or any of its subsidiaries, or any employee benefit plan...

  • Page 183
    ... severance allowance if Executive voluntarily leaves the employ of the Company prior to the expiration of such period of time. For purposes of this Agreement, the term "Good Reason" means any of the following which occurs, without Executive's consent, subsequent to the effective date of a Change in...

  • Page 184
    ... any reason by giving the Company fourteen (14) days prior written notice of the effective date of Termination. In the event that Executive voluntarily Terminates employment with the Company (except for Good Reason within two (2) years after a Change in Control of Health Net, Inc., as described in...

  • Page 185
    ...insurance company that provides managed health care or related services similar to those provided by the Company or any of its affiliates. B. Non-Solicitation. In addition, Executive agrees that, during the applicable Restricted Period following Termination of Executive's employment with the Company...

  • Page 186
    ... such assumption prior to the effectiveness of any such merger, consolidation or transfer of assets shall entitle Executive to compensation and other benefits from the Company in the same amount and on the same terms as Executive would be entitled hereunder if Executive's employment were Terminated...

  • Page 187
    ... Executive (including any payment or benefit received in connection with a Change in Control or the termination of Executive's employment, whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement) (all such payments and benefits, including the payments and benefits...

  • Page 188
    ... 409A A. If Executive is a "specified employee" (as determined under the Company's Specified Employee Policy as in effect from time to time, or, in the absence of such policy, within the meaning of Section 409A) with respect to the Company, any nonexempt non-qualified deferred compensation that is...

  • Page 189
    ... If to the Company: Health Net, Inc. 21650 Oxnard Street, 22nd Floor Woodland Hills, CA 91367 Attention: General Counsel Angelee F. Bouchard [ADDRESS] [ADDRESS] If to Executive: 21. Governing Law. The interpretation, construction and performance of this Agreement shall be governed by and construed...

  • Page 190
    ... shall survive and continue in full force and effect in accordance with the respective terms thereof, notwithstanding any termination of this Agreement or a Termination of Executive's employment. The parties agree that the Company would be damaged irreparably in the event any provision of Sections...

  • Page 191
    ... WHEREOF, the parties hereto have executed this Agreement as of the Effective Date set forth above. Executive /s/ Angelee F. Bouchard By: Name: Angelee F. Bouchard Title: SVP, General Counsel & Corporate Secretary cc: Karin Mayhew Debbie J. Colia / Angelee F. Bouchard Personnel File Health Net, Inc...

  • Page 192
    ... benefit plans as an active employee shall cease on the Termination Date, and Executive shall not be eligible to make contributions to or to receive Company matching contributions under the Health Net, Inc. 401(k) Associate Savings Plan, or to make any deferrals pursuant to any deferred compensation...

  • Page 193
    ..., representatives, trustees, administrators and assigns, hereby waives and releases the Company, and each of its past, present and future officers, directors, shareholders, employees, consultants, accountants, attorneys, agents, managers, insurers, sureties, parent and sister corporations, divisions...

  • Page 194
    ... reimbursable business expenses in accordance with the Company's expense policies and procedures then in effect. Executive shall not, without the Company's written consent by an authorized representative, at any time prior or subsequent to the execution of this Separation Agreement and Release...

  • Page 195
    ... under the Employment Agreement, and that no other payments or benefits will be asserted or requested by Executive. 15. Executive acknowledges that he has had an opportunity to consult and be represented by counsel of his own choosing in the review of this Separation Agreement and Release, and that...

  • Page 196
    ... revoke acceptance of this Separation Agreement and Release by delivering a letter of revocation within seven (7) days after the later of the dates set forth below addressed to: Health Net, Inc., Organization Effectiveness Department, 21650 Oxnard Street, Woodland Hills, California 91367, Attention...

  • Page 197
    IN WITNESS WHEREOF, the parties hereto have executed this Separation Agreement and Release as of the dates set forth below. Executive [EXHIBIT COPY] By: Name: Title: Dated: [TO BE INSERTED] A-6 Health Net, Inc. [EXHIBIT COPY] By: Name: Title: Dated: [TO BE INSERTED]

  • Page 198
    ...the "Effective Date"), by and between Health Net, Inc., a Delaware corporation (the "Company"), with its principal place of business located at 21650 Oxnard Street, Woodland Hills, California 91367, and Steven Sell ("Executive"). This Agreement amends and restates in its entirety the Prior Agreement...

  • Page 199
    ... option agreement, restricted stock agreement, restricted stock unit agreement, performance share agreement and/or severance agreement Executive enters into with the Company from time to time (collectively, "Personal Compensation Information"), may be disclosed in filings with the SEC, the New York...

  • Page 200
    ..., services, prices, margins and costs; (iii) confidential financial information; (iv) personnel information (including without limitation employee compensation); and (v) other confidential business information. B. Executive further agrees that at all times during Executive's employment and...

  • Page 201
    ... as Executive remains employed by the Company and Executive meets the applicable participation requirements. These benefit programs and plans currently include paid time off ("PTO"), holidays, group medical, dental, vision, term life, and short and long term disability insurance and participation in...

  • Page 202
    ... Bonus. Executive will be eligible to participate in the Health Net, Inc. Executive Officer Incentive Plan ("EOIP") in accordance with the terms of the EOIP, which provides Executive with a target bonus for each plan year equal to 80% of Executive's Base Salary as additional compensation according...

  • Page 203
    ..., dental and vision benefits (as maintained for Executive's benefit immediately prior to the date of Executive's Termination) (the "Benefits") for Executive and Executive's dependents for a period of 12 months, with premium payments paid by the Company on Executive's behalf, provided, that Executive...

  • Page 204
    ...Control. If at any time within two (2) years after a "Change in Control" of Health Net, Inc. Executive's employment is Terminated by Executive for "Good Reason" (each as defined below) (by giving the Company at least fourteen (14) days prior written notice of the effective date of Termination), then...

  • Page 205
    ... any reason by giving the Company fourteen (14) days prior written notice of the effective date of Termination. In the event that Executive voluntarily Terminates employment with the Company (except for Good Reason within two (2) years after a Change in Control of Health Net, Inc., as described in...

  • Page 206
    ... receive, provided Executive (or Executive's beneficiaries or estate, as applicable) signs a Separation Agreement, Waiver and Release of Claims substantially in the form attached hereto as Exhibit A, which is incorporated into this Agreement by reference, (i) continuation of Executive's Benefits for...

  • Page 207
    ...insurance company that provides managed health care or related services similar to those provided by the Company or any of its affiliates. B. Non-Solicitation. In addition, Executive agrees that, during the applicable Restricted Period following Termination of Executive's employment with the Company...

  • Page 208
    ... such assumption prior to the effectiveness of any such merger, consolidation or transfer of assets shall entitle Executive to compensation and other benefits from the Company in the same amount and on the same terms as Executive would be entitled hereunder if Executive's employment were Terminated...

  • Page 209
    ... 409A A. If Executive is a "specified employee" (as determined under the Company's Specified Employee Policy as in effect from time to time, or, in the absence of such policy, within the meaning of Section 409A) with respect to the Company, any nonexempt non-qualified deferred compensation that is...

  • Page 210
    ...and effect. 16. Company Policies. Executive's employment with the Company is subject to the terms and conditions contained in the Company's Associate Policies located on HR Link, which can be accessed through the Company's intranet site, as in effect from time to time (the "Associate Policies"), the...

  • Page 211
    ...: If to the Company: Health Net, Inc. 21650 Oxnard Street, 22nd Floor Woodland Hills, CA 91367 Attention: General Counsel Steven Sell [ADDRESS] [ADDRESS] If to Executive: 21. Governing Law. The interpretation, construction and performance of this Agreement shall be governed by and construed and...

  • Page 212
    IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the Effective Date set forth above. Executive By: /s/ Steven Sell Name: Steven Sell Title: President, Health Net of California cc: Angelee F. Bouchard Karin D. Mayhew Personnel File 15 Health Net, Inc. /s/ Karin D. Mayhew By: ...

  • Page 213
    ... benefit plans as an active employee shall cease on the Termination Date, and Executive shall not be eligible to make contributions to or to receive Company matching contributions under the Health Net, Inc. 401(k) Associate Savings Plan, or to make any deferrals pursuant to any deferred compensation...

  • Page 214
    ..., representatives, trustees, administrators and assigns, hereby waives and releases the Company, and each of its past, present and future officers, directors, shareholders, employees, consultants, accountants, attorneys, agents, managers, insurers, sureties, parent and sister corporations, divisions...

  • Page 215
    ... reimbursable business expenses in accordance with the Company's expense policies and procedures then in effect. Executive shall not, without the Company's written consent by an authorized representative, at any time prior or subsequent to the execution of this Separation Agreement and Release...

  • Page 216
    ... under the Employment Agreement, and that no other payments or benefits will be asserted or requested by Executive. 15. Executive acknowledges that he has had an opportunity to consult and be represented by counsel of his own choosing in the review of this Separation Agreement and Release, and that...

  • Page 217
    ... revoke acceptance of this Separation Agreement and Release by delivering a letter of revocation within seven (7) days after the later of the dates set forth below addressed to: Health Net, Inc., Organization Effectiveness Department, 21650 Oxnard Street, Woodland Hills, California 91367, Attention...

  • Page 218
    IN WITNESS WHEREOF, the parties hereto have executed this Separation Agreement and Release as of the dates set forth below. Executive By: [EXHIBIT COPY] Name: Title: Dated: [TO BE INSERTED] A-6 Health Net, Inc. [EXHIBIT COPY] By: Name: Title: Dated: [TO BE INSERTED]

  • Page 219
    ... your change of position to the position of President, Regional Health Plans, Health Net of the Northeast, Inc. ("HNNE"), in connection with the transition of our HNNE commercial membership to UnitedHealth Group Inc., pursuant to that certain stock purchase agreement dated July 20, 2009 (the "Stock...

  • Page 220
    ... GOOD REASON FOLLOWING CHANGE IN CONTROL : In lieu of the 36 months of severance pay set forth in clause (i) of the first paragraph of Section 10.B of the Employment Agreement, you will be eligible to receive a lump-sum cash payment equal to 24 months of your Base Salary in effect immediately prior...

  • Page 221
    ... the Employment Agreement, the terms of this Agreement shall govern. If this letter meets with your approval, please sign, date and return a copy to me. Sincerely, Health Net, Inc. /s/ Karin D. Mayhew By: Name: Karin D. Mayhew Title: SVP - OE Accepted and Agreed, this 14 th day of December, 2009. By...

  • Page 222
    ... by reference herein, the "Option Agreement") is made as of the grant date set forth on the Grant Notice (the "Grant Date"), by and between Health Net, Inc., a Delaware corporation (the "Company"), and the participant identified on the Grant Notice, an employee of the Company or a Subsidiary of the...

  • Page 223
    ... time within three months after the Optionee's termination of employment. For purposes of this Option Agreement, if a Subsidiary by which the Optionee is employed ceases to be a Subsidiary, whether through a sale by the Company of all or a portion of the stock or assets of such Subsidiary, a merger...

  • Page 224
    ... Shares (I) on the date of acquisition of such Option Shares or (II) on the date such competitive activity with a Competitor was commenced by the Optionee; and "Competitor" shall refer to any health maintenance organization or insurance company that provides managed health care or related services...

  • Page 225
    To the Company at: Health Net, Inc. 21650 Oxnard Street Woodland Hills, California 91367 Attention: General Counsel or to such other address as any party may have furnished to the other in writing in accordance herewith, except that notices of change of address shall be effective only upon receipt...

  • Page 226
    ... WITNESS WHEREOF, the parties hereto have executed this Option Agreement as of the date and year set forth above. Health Net, Inc. Name: Title: OPTIONEE HEREBY EXPRESSLY ACKNOWLEDGES AND AGREES THAT (I) HE/SHE IS AN EMPLOYEE AT WILL AND MAY BE TERMINATED BY THE EMPLOYER AT ANY TIME, WITH OR WITHOUT...

  • Page 227
    ...THE EXTENT EXPRESSLY PROVIDED IN THIS OPTION AGREEMENT. Your acceptance of this Option Agreement indicates that you hereby accept and agree to all the terms and provisions of the foregoing Option Agreement and the attached Grant Notice, and to all the terms and provisions of the Plan incorporated by...

  • Page 228
    Notice of Grant of Stock Options Health Net, Inc. Plan Name: Participant Name: Participant ID: Grant Date: Grant Number: Type of Options: Option Shares Granted: Exercise Price: Expiration Date: Vesting Template: Vesting Schedule: Non-Qualified Stock Options

  • Page 229
    ...OF GRANT] FORM OF NONQUALIFIED STOCK OPTION AGREEMENT FOR NON-EMPLOYEE DIRECTORS UNDER THE HEALTH NET, INC. 2006 LONG-TERM INCENTIVE PLAN, AS AMENDED This agreement (the "Option Agreement") is made as of [DATE] (the "Grant Date"), between Health Net, Inc., a Delaware corporation (the "Company"), and...

  • Page 230
    ...his or her term of office, then the Option (subject to clause (g) below) may be exercised at any time within three months after the Optionee's termination of service as a Director. (f) Termination for Other Reason. If prior to the exercise of the Option, the Optionee's service as a Director shall be...

  • Page 231
    ...those contained in this Option Agreement or the Plan shall be valid or binding. Any prior agreements, statements or promises, either oral or written, made by any party or agent of any party relating to or effecting the Option that are not contained in the Option Agreement or the Plan are of no force...

  • Page 232
    ... sale of the Option Shares. This Form 1099-Misc can be used to calculate the applicable federal and state income taxes. IN WITNESS WHEREOF, the parties hereto have executed this Option Agreement as of the date and year set forth above. HEALTH NET, INC. By: Name: Title: The undersigned hereby accepts...

  • Page 233
    ..., of the Company. 2.7 "Company" shall mean Health Net, Inc. (formerly known as Foundation Health Systems, Inc.), a Delaware corporation, or any successor thereto. 2.8 "Compensation" shall mean the total earnings paid by an Employer to an Eligible Employee and properly reportable on IRS Form W-2 for...

  • Page 234
    ... Company established on behalf of an Eligible Employee to which shall be credited the following: (i) amounts equal to the benefits earned by such Eligible Employee as of December 31, 2000 (the "Plan Termination Date") under The Health Net Executive Deferral Plan (the "Deferral Plan") and The Health...

  • Page 235
    ... power of all classes of stock in one of the other corporations in such chain. III. PARTICIPATION AND DEFERRALS 3.1 Participation. (a) In General. Each Eligible Employee may participate in the Plan in a Deferral Year by irrevocably specifying on an election form filed with the Company prior to the...

  • Page 236
    ... Deferral Year, such individual must file a deferral election form with the Company within 30 days of his or her date of hire (hereinafter, such individual is referred to as an "Eligible Employee") and may only elect to defer Compensation with respect to services performed for periods following the...

  • Page 237
    ... by the Participant on the applicable election form of the Participant. Notwithstanding the foregoing, in the event that the Participant is a "specified employee" (within the meaning of Section 409A of the Code) with respect to the Company at the time of a termination of employment, the payment (or...

  • Page 238
    ... to the extent the Company determines that the payment on such Payment Date would cause the Participant's Employer to be unable to deduct any portion of the Participant's Compensation as a result of the limitations prescribed by Section 162(m) of the Code; provided, however, that any such deferral...

  • Page 239
    ..., such payment may be made to or for the benefit of any such individual in any of the following ways as the Company shall direct: (a) directly to any such minor individual if, in the opinion of the Company, he or she is able to manage his or her financial affairs, (b) to the legal representative of...

  • Page 240
    ...of the decision denying the claim. VI. MISCELLANEOUS 6.1 Unfunded Status and Application of ERISA. The Plan is intended to be an unfunded plan maintained primarily for the purpose of providing deferred compensation to a select group of management or highly compensated employees within the meaning of...

  • Page 241
    ... the Company, any Employer, the Board, the Committee, or any of their officers, trustees, associates, or agents, other than such as are specifically conferred by the express terms of the Plan. 6.3 Satisfaction of Claims. The payment to a Participant, Beneficiary or other person of an account balance...

  • Page 242
    ... 13(d)(3) and 14(d)(2) of the Exchange Act), corporation or other entity (other than the Company or any employee benefit plan sponsored by an Employer) of any Common Stock of the Company (or securities convertible into the Company's Common Stock) for cash, securities or any other consideration...

  • Page 243
    ... United States, shall be governed by the laws of the State of Delaware and construed in accordance therewith without giving effect to the principles of conflicts of laws. 6.12 Change in Time or Form of Payment under Code Section 409A Transition Relief. As provided in Internal Revenue Service Notice...

  • Page 244
    ... are not employees of the Company, to defer cash retainers and meeting fees earned for services performed during the year, until such times as set forth herein. Prior to January 1, 2004, such directors were eligible to participate in the Health Net, Inc. Deferred Compensation Plan, on substantially...

  • Page 245
    ... immediately after the merger. 2.19 "Participant" shall mean a Director who has elected to defer, pursuant to the terms of the Plan, the receipt of an amount of Compensation earned for services performed during a Deferral Year. 2.20 "Payment Date" shall mean the date chosen by the Company, in its...

  • Page 246
    ... Director. To participate in the Plan for such Deferral Year, such individual must file a deferral election form with the Company within 30 days of his or her becoming a Director and may only elect to defer Compensation earned with respect to services performed for periods following the date of such...

  • Page 247
    ... by the Participant on the applicable election form of the Participant. Notwithstanding the foregoing, in the event that the Participant is a "specified employee" (within the meaning of Section 409A of the Code) with respect to the Company at the time of a termination of service, the payment (or the...

  • Page 248
    ... in the form of a single lump sum if (i) the amount credited to such Account as of the relevant Payment Date is less than the applicable dollar amount under Section 402(g)(1)(B) of the Code, (ii) the Participant has not attained age 55 as of the date of such Participant's termination of service as...

  • Page 249
    ..., such payment may be made to or for the benefit of any such individual in any of the following ways as the Company shall direct: (a) directly to any such minor individual if, in the opinion of the Company, he or she is able to manage his or her financial affairs, (b) to the legal representative of...

  • Page 250
    ... and the Company shall indemnify and hold harmless such officers and employees from and against all claims, losses, damages, causes of action and expenses, including reasonable attorney fees and court costs, incurred in connection with such interpretation and administration of the Plan. The expenses...

  • Page 251
    ... (i) reduce the amount credited to any account of any Participant immediately prior to such amendment, policies and procedures, or actions, or (ii) be permitted which would result in taxation of Participants pursuant to Section 409A of the Code. 6.6 Termination of the Plan. The Company may, in its...

  • Page 252
    ... 13(d)(3) and 14(d)(2) of the Exchange Act), corporation or other entity (other than the Company or any employee benefit plan sponsored by an Employer) of any Common Stock of the Company (or securities convertible into the Company's Common Stock) for cash, securities or any other consideration...

  • Page 253
    6.12 Change in Time or Form of Payment under Code Section 409A Transition Relief. As provided in Internal Revenue Service Notice 2007-86, notwithstanding any other provision of this Plan, with respect to an election or amendment to change a time or form of a deferral election under this Plan made on...

  • Page 254
    Exhibit 10.80 STANDARD FORM OFFICE LEASE BETWEEN AEROJET-GENERAL CORPORATION, an Ohio corporation as "LANDLORD" AND HEALTH NET FEDERAL SERVICES, LLC a Delaware limited liability company as "TENANT" JULY 13, 2009

  • Page 255
    ... TERM AND POSSESSION RENT INTENTIONALLY OMITTED USE UTILITY INSTALLATIONS ALTERATIONS AND ADDITIONS REPAIRS AND MAINTENANCE LIENS UTILITIES AND SERVICES ASSIGNMENT AND SUBLETTING DEFENSE AND INDEMNITY, WAIVERS, AND LIMITATIONS INSURANCE TAXES ON TENANT'S PROPERTY DAMAGE OR DESTRUCTION CONDEMNATION...

  • Page 256
    LIST OF EXHIBITS Exhibit A Exhibit B Exhibit C Exhibit D Exhibit E Exhibit F Exhibit G Base Rent Schedule Legal Description of the Land Parking Site Plan Description of the Premises - Space Plan Environmental Disclosures Rules and Regulations ii

  • Page 257
    ... Date Facility FMRV Government Contract Hazardous Materials HVAC Land Landlord Landlord Parties Landlord's Address Landlord's Broker Late Charge Lease Lease Date Liability Claim Parking Facilities Partner Permitted Use Premises Project Renewal Notice Renewal Option Renewal Term Rent Rentable Area...

  • Page 258
    Rules and Regulations Security Deposit Space Tenant Tenant Affiliate Tenant Improvements Tenant Parties Tenant's Broker Tenant's Notice Address Tenant's Property Term Transfer Date Transfer Notice Utility Installation Worth at the time of the award iv 29 c 14 1 13 1 16 a a 20 c 13 13 7 26

  • Page 259
    BASIC LEASE INFORMATION. Addresses: "Tenant's Notice Address" is Health Net Federal Services, LLC Post Office Box 2470 Rancho Cordova, CA 95741-2470 Attn: Director of Real Estate Phone: (916) 935-1317 Fax: (916) 935-4406 "Landlord's Notice Address" is: Aerojet-General Corporation c/o GenCorp Realty ...

  • Page 260
    ... of the "Parking Facilities," which means the parking areas usable by the tenants of the Building as designated by Landlord from time to time and initially shown on Exhibit D attached hereto. "Permitted Use " shall mean corporate, executive and general office use, except that those portions of the...

  • Page 261
    ...eighteen (18) full calendar months plus, if the Commencement Date is other than the first day of a calendar month, the partial month between the Commencement Date and the end of the calendar month during which the Commencement Date occurs. Unless sooner terminated as provided in this Lease, the Term...

  • Page 262
    ... Standard Form Office Lease ("Lease") is made and entered into by and between AEROJET-GENERAL CORPORATION, an Ohio corporation ("Landlord"), and HEALTH NET FEDERAL SERVICES, LLC, a Delaware limited liability company ("Tenant"), on the terms, covenants and conditions set forth below, and is dated as...

  • Page 263
    ...RENT. 3.1 Base Rent . Tenant agrees to pay Landlord Base Rent for the Premises, without prior notice, demand, deduction or offset (except as otherwise provided in this Lease or under applicable law), as adjusted from time to time pursuant to the Base Rent Schedule set forth in Exhibit A . Base Rent...

  • Page 264
    ... may determine to provide from time to time, so long as (i) Tenant's access to the Premises is not materially and negatively impacted in any direct way, and (ii) Tenant retains the right to use the number of parking spaces allocated to Tenant as set forth in the Basic Lease Information. 5.3 Parking...

  • Page 265
    ...access badge system (in addition to Tenant's own access badge system). Tenant shall cause Tenant Parties and all other persons entering the Facility at the request or invitation of any of the Tenant Parties to cooperate with Landlord's security personnel. Landlord will continue to work...allow any sale...

  • Page 266
    ... et seq., and Fish and Game Code Section 5650, or comparable statutes and ordinances and each as from time to time amended, any regulations implementing any such statutes. Tenant shall not cause, or allow any agent, employee, subtenant, contractor, representative or invitee of Tenant to cause, any...

  • Page 267
    ...and all claims, liabilities, losses, costs, loss of rents, liens, damages, injuries or expenses (including attorneys' and consultants' fees and court costs), demands, causes of action, or judgments directly or indirectly arising out of or related to the use, generation, storage, release, or disposal...

  • Page 268
    ... serves the Premises: communications systems, including voice/data cabling, telecommunications, computer cabling and wiring. 6.2 Alterations. Tenant shall not make or suffer to be made any Utility Installations, structural or non-structural alterations, additions, or improvements (collectively...

  • Page 269
    ... exterior appearance. As a condition to its consent, Landlord may request adequate assurance that all contractors who will perform such work have in force workman's compensation and such other employee and public liability insurance as Landlord deems reasonably necessary, and where the Alterations...

  • Page 270
    ... Tenant's sole cost and expense, maintain the Premises (other than the portions of the Building Structure (defined below) and Building Systems (defined below) of the Building which are contained in the Premises), in good, clean and first-class condition and repair. Without limiting the generality of...

  • Page 271
    ... intentional acts or omissions of Landlord or its agents or employees (including, but not limited to, the failure to maintain the Premises or the Building pursuant to this Section 7.2 or to provide the services required under Section 9.1 below), then the payment of Rent shall be abated to the extent...

  • Page 272
    ... or quality consistent with that of other office projects in the Rancho Cordova area and shall, at Landlord's sole cost, (i) provide janitorial service to the Premises on a five day a week basis (excepting the holidays described in the Basic Lease Information), (ii) supply public restroom supplies...

  • Page 273
    ... of California Civil Code Section 1932(1) or any other applicable existing or future law, ordinance or governmental regulation permitting the termination of this Lease due to the interruption or failure of any services to be provided under this Lease. 9.2 Tenant Obligations. 9.2.1 Cost of Utilities...

  • Page 274
    ...10) days prior to the date when Tenant desires the assignment or subletting to be effective (the "Transfer Date"), Tenant shall give Landlord a notice (the "Transfer Notice ") which shall set forth the name, address and business of the proposed assignee or subtenant, information (including financial...

  • Page 275
    .... Any assignee shall have signed and delivered to Landlord a written assumption of the obligations of Tenant under this Lease in a form reasonably acceptable to Landlord; 10.3.6 Subtenant Compliance . Any subtenant shall have agreed in writing to comply with all applicable terms and conditions of...

  • Page 276
    ..., or any officer, agent or employee of Tenant, (iii) any claim by any person that if brought against Tenant would be covered by the workers' compensation and employer's liability insurance required to be carried by Tenant, and (iv) from all and against all reasonable cost, attorney's fees, expenses...

  • Page 277
    ... of (if Tenant is a corporation or limited liability company: its shareholders or members, officers, directors; if Tenant is a partnership: its constituent partners,) its employees, agents, and contractors (collectively and including Tenant, "Tenant Parties") waives all claims (in law, equity or...

  • Page 278
    ... or policies of commercial property coverage (including the Tenant Improvements of a structural nature) for full replacement cost and "All Risk" insurance in the name of Landlord, with loss payable to Landlord and/or to any lenders having a lien on the Project or any part of it, covering loss or...

  • Page 279
    ... the terms of such insurance policies. Such coverage shall have a minimum combined single limit of liability of at least Two Million Dollars ($2,000,000.00), and a minimum general aggregate limit of Five Million Dollars ($5,000,000.00), with an "Additional Insured - Managers or Lessors of Premises...

  • Page 280
    ... by companies rated A-VII or better in "Best's Insurance Guide" and authorized or approved to do business in the State of California (admitted). Tenant shall deliver to Landlord on or before the Commencement Date, and thereafter at least 30 days before the expiration dates of the policies, copies...

  • Page 281
    ... its share of such taxes within 30 days after delivery to Tenant by Landlord of a statement in writing setting forth the amount of such taxes applicable to Tenant's Property with supporting documentation. Tenant shall pay directly to the party or entity entitled thereto all business license fees...

  • Page 282
    ... the Premises and provides such written notice to Tenant, Tenant shall have the option to terminate this Lease effective upon the date of the occurrence of... sentence, Tenant's liability shall also include Tenant's payment of Landlord's deductible under the property insurance policy required to be ...

  • Page 283
    ...the Premises is taken and the remaining area of the Premises is not reasonably sufficient for Tenant to continue operation of its business, any portion of the Building or Land is so taken or sold and such taking or sale materially and adversely affects Tenant's access to the Premises, or the Parking...

  • Page 284
    ... Lease; provided, however, Rent shall abate during such limited period in proportion to the portion of the Premises that is rendered unusable as a result of such condemnation or other taking to the extent the business interruption insurance Tenant is required to carry would not otherwise cover the...

  • Page 285
    ... not in addition to, any notice required under Section 1161 of the California Civil Code of Procedure or any other law now or hereafter in effect requiring that notice of default be given prior to the commencement of an unlawful detainer or other legal proceeding. 16.1.3 Failure to Perform . Tenant...

  • Page 286
    ... a waiver of timely payment for the particular Rent involved, regardless of Landlord's knowledge of any breach at the time of such acceptance of Rent, and shall not prevent Landlord from maintaining an unlawful detainer or other action based on such breach. No act or conduct of Landlord, including...

  • Page 287
    ... pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be due immediately from Tenant to Landlord at the time the sum is paid, and if paid at a later date shall bear interest at the lesser of 10% per annum, or the maximum rate an individual...

  • Page 288
    ... at any time and from time to time upon not less than twenty (20) days' prior written notice from the other party execute, acknowledge, and deliver to the requesting party a statement in writing, (a) certifying that this Lease is unmodified and in full force and effect (or, if modified, stating the...

  • Page 289
    ...agreement. 22. BROKER. 22.1 Landlord and Tenant recognize CB Richard Ellis, Inc. ("Tenant's Broker") as Tenant's authorized representative. Landlord shall pay Tenant's Broker a standard market fee equal to 2.0% of the total Base Rent, payable within 45 days of a mutually executed lease, for services...

  • Page 290
    ... represented shall be responsible for said commission or fee and shall indemnify and hold harmless the other party from and against all liabilities, losses, costs and expenses (including reasonable attorneys fees) arising in connection with such claim for a commission or finder's fee. In addition...

  • Page 291
    ... efforts to minimize any interference with Tenant's business operations or access to the Premises and shall attempt to reasonably schedule such entry and work with Tenant. Landlord shall perform all work in a commercially reasonable manner, and whenever appropriate (as reasonably determined...

  • Page 292
    ...nor does Landlord represent, that any specific tenant or number of tenants shall during the Term of this Lease occupy any space in the Building. 28. RENEWAL OPTION. 28.1 Option Right. If Tenant prior to the Exercise Date (as defined below) enters into a new TRICARE contract (the "Government Contract...

  • Page 293
    ... located in comparable office buildings in the Rancho Cordova office market. Notwithstanding the foregoing, in no event shall the FMRV be less than the Base Rent in effect immediately prior to the expiration of initial Term. 28.3.1 If Tenant elects to exercise the Renewal Option, Landlord and Tenant...

  • Page 294
    ..., such new Base Rent shall take effect retroactive to the commencement of the Renewal Term, and Tenant shall pay to Landlord that sum which is accrued and unpaid as a result of such retroactive application, together with the next monthly installment of Base Rent payable by Tenant. The cost of the...

  • Page 295
    ... except by an agreement in writing signed by the parties hereto or their respective successors in interest. This Lease shall not be effective or binding on any party until fully executed by both parties hereto. 29.8 Authority of Tenant. If Tenant is a corporation, limited liability company or other...

  • Page 296
    ... upon and shall inure to the benefit of the parties hereto and their respective heirs, executors, administrators, legal representatives, successors and assigns. 29.17 Waiver of California Code Sections: Notwithstanding any other provision of this Lease and in addition to any waivers which may be...

  • Page 297
    ... other party, such demand or request shall be reasonable and made in good faith. 29.25 HIPAA: Landlord agrees that from time to time during the Term, Landlord, its agents, employees or assigns, may be exposed to, or have access to, Protected Health Information ("PHI"), as defined by Health Insurance...

  • Page 298
    ... the same instrument. IN WITNESS WHEREOF, the parties have executed this Lease as set forth below. LANDLORD: AEROJET-GENERAL CORPORATION, an Ohio corporation By: /s/ Scott Neish TENANT: HEALTH NET FEDERAL SERVICES, LLC, a Delaware limited liability company By: /s/ Dennis Bell Name: Scott Neish Its...

  • Page 299
    ... LEASE This SECOND AMENDMENT TO OFFICE LEASE (this "Amendment") is made and entered into effective as of May 1, 2003, by and between LNR WARNER CENTER, LLC, a California limited liability company ("Landlord"), and HEALTH NET, a California corporation ("Tenant "). R E C I T A L S: A. DCA Homes, Inc...

  • Page 300
    ... Rent payable for the Existing Premises and shall be as set forth in the following schedule: Months of 1st Floor Lease Term Monthly Installment of Base Rent Monthly Rental Rate per Rentable Square Foot of 1st Floor Building C Space Annual Base Rent 1 - 12 13 - 24 25 - 36 37 - 48 49 - 60 61 - 72 73...

  • Page 301
    ...all claims, demands, losses, liabilities, lawsuits, judgments, and costs and expenses (including without limitation reasonable attorneys' fees) with respect to any leasing commission or equivalent compensation alleged to be owing in connection with this Amendment on account of the indemnifying party...

  • Page 302
    ... been executed as of the day and year first above Britten. "LANDLORD" LNR WARNER CENTER, LLC, a California limited liability company By: /s/ Curtis J. Stephenson Name: Curtis J. Stephenson Title: Assistant Vice President By: Name: Title: "TENANT" HEALTH NET, a California corporation By: /s/ Dennis...

  • Page 303
    ..., the following terms have the meaning given: (a) Effective Date: October 10, 2003. (b) Landlord: Warner Center OPCO, L.P., a Delaware limited partnership. (c) Tenant: Health Net, Inc., a California corporation, d/b/a Health Net. (d) Lease: Office Lease dated September 20, 2000 between DCA Home, Inc...

  • Page 304
    ... restates and replaces in its entirety the Base Rent schedule set forth in paragraph 8 of the Summery of Basic Lease information for the Original Lease: Months of Lease Term Annual Base Rent Monthly Installment of Base Rent Monthly Rental Rate Per Rentable Square Foot 1/1/02-12/31/02 1/1/03-12...

  • Page 305
    .... The undersigned have executed this Third Amendment as of the Effective Date. LANDLORD: Warner Center OPCO, L.P., a Delaware limited partnership By: Warner Center Holdco, LLC, a Delaware limited liability company, general partner TENANT: Health Net, Inc., a California corporation /s/ Dennis Bell By...

  • Page 306
    ... Center, LLC, a Delaware limited partnership. (d) Tenant: Health Net of California, Inc., a California corporation formally, known as Health Net, a California corporation. (e) Lease: Office Lease dated September 20, 2000 between DCA Home, Inc. and Lennar Rolling Ridge, Inc. (collectively, "Prior...

  • Page 307
    ...audit, the amount, determination and payment of the 2002 and 2003 Direct Expenses. 7. Waiver Of California Civil Code § 1542 . Each party knowingly waives the provisions of California Civil Code §1542 which provides as follows A general release does not extend to claims which the creditor does not...

  • Page 308
    ... The undersigned have executed this Fourth Amendment as of the Effective Date. LANDLORD: Warner Center OPCO, L.P., a Delaware limited partnership By: Warner Center Holdco, LLC, a Delaware limited liability company, general partner TENANT: Health Net, Inc., a California corporation /s/ Dennis Bell By...

  • Page 309
    ..., the following terms have the meaning given: (a) Effective Date: August 16, 2006. (b) Landlord: MP Warner Center, LLC, a Delaware limited partnership. (c) Tenant: Health Net of California, Inc., Inc., a California corporation. (d) Lease: Office Lease dated September 20, 2000 between DCA Home, Inc...

  • Page 310
    ...and conditions of the Lease. LANDLORD: MP WARNER CENTER, a Delaware limited liability company By: RREEF Management Company, a Delaware corporation, Authorized Agent TENANT: HEALTH NET OF CALIFORNIA, INC., a California corporation By: Name: Title: Date: /s/ Dennis Bell Dennis Bell Vice President Real...

  • Page 311
    ...Health Net of the Northeast, Inc. In consideration of the mutual benefits and obligations set forth herein, the parties hereby amend a certain lease between Landlord and Physicians Health Services of Connecticut, Inc. dated... Leased Premises Square Footage shall be increased by 5,288 square feet, and ...

  • Page 312
    ...payable in equal monthly installments, in advance, on the first of each month." G. Paragraph 1.1 (i) of the Lease is deleted and is replaced with the following: "1.1 (i) The "Notice Address" for Landlord and Tenant are: Landlord: Beard Sawmill, LLC % R. D. Scinto, Inc. One Corporate Drive, Suite 100...

  • Page 313
    ...Chief Financial Officer Health Net...Date is 70.11%. Tenant's Percentage shall be proportionately adjusted upon any change...work required under the terms of the Lease and the Leased Premises has been accepted by Tenant. 3.08 Landlord has completed all work...incorporated into it as new exhibits, and are ...

  • Page 314
    IN WITNESS WHEREOF, the parties have hereunto set their hands and seals as of the day and year first above written. BEARD SAWMILL, LLC /s/ Robert D. Scinto By: Robert D. Scinto, a member 4 HEALTH NET OF THE NORTHEAST, INC. By: /s/ Dennis Bell Its: Vice President Real Estate Management

  • Page 315
    ... will well and truly pay said sums that may remain due unto the Landlord. IN WITNESS WHEREOF, the Guarantor has executed this affirmation of guaranty on the 5th day of October, 2006. Health Net, Inc. By: /s/ Dennis Bell State of California As City/Town of Woodland Hills County of Los Angeles...

  • Page 316
    Exhibit 10.93 PAPAGO BUTTES CORPORATE PLAZA 1230 West Washington Street OFFICE LEASE TOSCO OPERATING COMPANY, INC. a Delaware corporation Landlord and HEALTH NET OF ARIZONA, INC. an Arizona corporation Tenant Dated: July 24, 2003

  • Page 317
    ... AND COMMON AREAS SECURITY DEPOSIT RENT OPERATING COSTS TAXES INSURANCE AND INDEMNITY FIRE AND CASUALTY CONDEMNATION MAINTENANCE AND OFFICE SERVICES TENANT ALTERATIONS AND SIGNAGE ASSIGNMENT AND SUBLETTING SUBORDINATION AND ATTORNMENT ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS QUIET ENJOYMENT...

  • Page 318
    OFFICE LEASE TOSCO OPERATING COMPANY, INC. , a Delaware corporation ("Landlord"), hereby leases the Premises described below, for the Term and on the terms and conditions set forth in this Lease, to HEALTH NET OF ARIZONA, INC., an Arizona corporation ("Tenant") 1. SUMMARY OF BASIC TERMS 1.1 The ...

  • Page 319
    ... of Real Estate and to: Colliers International 1610 Arden Way, Suite 242 Sacramento, California 95815 Attention: Corporate Services Department Re: Health Net 1.13 Landlord's Notice Address: ConocoPhillips, 1500 North Priest Drive, Tempe, Arizona 85072, Attention: Building Services Manager. -2-

  • Page 320
    .... At the request of either party at any time following initial occupancy of the Premises by Tenant, Landlord and Tenant shall execute a written memorandum reflecting the date of initial occupancy and confirming the Commencement Date, the Expiration Date, and the Rentable Area of the Premises...

  • Page 321
    ... account Tenant's obligation to pay additional rent under this Lease and other tenants' obligations to pay similar amounts under comparable leases. "Market Rate" shall include periodic scheduled rental increases then being included in leases under prevailing custom. The determination of Market Rate...

  • Page 322
    ...shall bear all reasonable fees and costs of the arbitrator and all reasonable attorneys' fees and costs incurred by the other party. 2.7 Right of Termination. Tenant shall have the option to terminate this Lease effective as of the end of Lease Month 66 (the "Effective Date") by notice ("Termination...

  • Page 323
    ... state law, as the same are in effect on the date hereof and may be hereafter modified or amended or supplemented (collectively the "ADA"): (a) Landlord shall comply with the ADA with respect to operation of the Common Areas, work done in Common Areas (including, without limitation and as the case...

  • Page 324
    ...in common by tenants and their employees and invitees ("Common Areas") at all times shall remain subject to Landlord's exclusive control, and Landlord shall be entitled to make such changes in the Common Areas as it reasonably deems appropriate, provided that Tenant's access to the Premises, and use...

  • Page 325
    ...30 per month per covered reserved space and $20 per month per covered unreserved space; provided, however, for the first twenty-four Lease Months, no charges shall be paid for parking and during any Extension Option terms, the amount of the parking charges shall be the standard parking rates for the...

  • Page 326
    ... Landlord with the statement. Late delivery of the annual statement of Operating Costs shall not relieve Tenant of any obligation with respect to payment of Tenant's Proportionate Share of the Operating Costs, provided that such delay does not exceed six months. For at least six months after the end...

  • Page 327
    ... manager, superintendent, operation and maintenance staff, and other employees of Landlord directly involved in the maintenance and operation of the Building, including contributions and premiums towards fringe benefits, unemployment and worker's compensation insurance, pension plan contributions...

  • Page 328
    ... with requirements of applicable law, excluding matters that were not in compliance as of the Commencement Date; (l) Audit fees and the cost of accounting services incurred in the preparation of statements referred to in this Lease; and (m) A fee for the administration and management of the Building...

  • Page 329
    ... with Law applicable to the Premises or the Building as of the Commencement Date. (l) Costs (i) arising from the disproportionate use of any utility or service supplied by Landlord to any other occupant of the Building, or (ii) associated with utilities and services of a type not provided to Tenant...

  • Page 330
    ...operations", "products and completed operations", and "blanket contractual" liabilities, written on an occurrence basis with limits not less than $1,000,000 per occurrence, $2,000,000 annual aggregate, naming Landlord, its agents, affiliates, and contract property manager as additional insureds. -13...

  • Page 331
    ... Workers' compensation insurance in accordance with applicable law and employer's liability insurance with a limit not less than $1,000,000 bodily injury each accident; $1,000,000 bodily injury by disease - each person; and $1,000,000 bodily injury by disease - policy limit. 9.2 Policy Requirements...

  • Page 332
    ... shall at all times keep in force "Special Form" property insurance insuring the Building in the amount of its full replacement value, and reasonable amounts of commercial general liability insurance. No insurable interest is conferred upon Tenant under any policies of insurance carried by Landlord...

  • Page 333
    ...from seeking and recovering on its own account from the condemning authority any award of compensation attributable to the taking or purchase of Tenant's personal property or trade fixtures or attributable to Tenant's relocation expenses provided that any separate claim by Tenant shall not reduce or...

  • Page 334
    ... office equipment. Landlord shall supply water and sewer services for any plumbing facilities in the Premises and Common Area restrooms. Tenant shall pay to Landlord within thirty days after receipt of invoice: (a) for heating, ventilation and air conditioning requested by Tenant to be provided...

  • Page 335
    ... charge for such usage by an employee shall be $25.00 per month. The amount of the monthly charge may be changed in the future so long as the same charge E applicable to all persons working in the Building who have access to the exercise facility. 12.8 Limited Self-Help Remedy. If: (a) a condition...

  • Page 336
    ... performance and payment bonds as well as proof of workers' compensation and general liability insurance coverage, including coverage for completed operations and contractual liability, with Landlord and its agents and designees named as additional insureds, in amounts, with companies, and in form...

  • Page 337
    ..., plumbing or other systems be performed by Landlord at Tenant's cost or by a contractor designated by Landlord, provided that such contractor are available to timely provide such work at prices consistent with market conditions for such work. 13.3 Roof-Mounted Communications Equipment for Tenant...

  • Page 338
    ... six consecutive months, then Landlord shall be entitled to require Tenant to remove its sign from the sign monument so that a tenant occupying more Rentable Area than Tenant may have its sign on the sign monument. 13.5 Mechanics Liens. Tenant shall pay before delinquent all costs for work done or...

  • Page 339
    ... under common control with Tenant; (ii) a successor corporation related to Tenant by merger, consolidation, nonbankruptcy reorganization, or government action, so long as the successor entity has a net worth not less than that of Tenant prior to the merger or other combination; or (iii) a purchaser...

  • Page 340
    ...subtenant was to pay rent; (c) any improvement allowance or other economic concession (space planning allowance, moving expenses, etc.) paid by Tenant to or for the benefit of its assignee or subtenant; (d) broker's commissions; (e) attorneys' fees; (f) lease takeover payments; (g) costs required to...

  • Page 341
    ... on which either such termination becomes effective being referred to herein as the "Turnover Date"), the Tenant hereunder will attom to the Overlandlord and pay the Overlandlord all of the rents and other monies required to be paid by the Tenant hereunder, and perform all of the terms, covenants...

  • Page 342
    ... materially and adversely affected, and such actions do not reduce Tenant's rights or increase Tenant's obligations hereunder. 16. ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS Tenant shall at any time within ten days after written request from Landlord execute, acknowledge and deliver to Landlord...

  • Page 343
    ... case rent shall be payable monthly in advance at a rate equal to 125% of the rate in effect immediately before the holdover began for the first three months of the holdover and thereafter at 150% of such rate. A holdover month-to-month tenancy may be terminated by either party at any time upon...

  • Page 344
    ... from all claims or liabilities arising from any breach of the foregoing representation and warranty. As consideration for Tenant's execution of this Lease, Landlord shall pay a commission to Tenant's Broker pursuant to a separate agreement, and if Landlord fails to do so in a timely manner and...

  • Page 345
    ... such waiver is in writing. 24.3 Effect of Payment. No payment by Tenant or receipt by Landlord of a lesser amount than the monthly payment of rent herein stipulated is deemed to be other than on account of the earliest stipulated rent, nor is any endorsement or statement on any check or any letter...

  • Page 346
    ... with and governed by the laws of the State of Arizona. 24.10 Deadlines Enforceable. Time is of the essence of this Lease and of every part hereof. 24.11 Counterparts. This Lease may be executed in counterparts, which together shall constitute a single instrument. TENANT: HEALTH NET OF ARIZONA, INC...

  • Page 347
    ... 10.94 FIRST AMENDMENT TO OFFICE LEASE This First Amendment, dated as of December 1, 2003, amends the Office Lease dated July __, 2003, between CONOCOPHILLIPS COMPANY , a Delaware corporation ("Landlord"), and HEALTH NET OF ARIZONA, INC., an Arizona corporation ("Tenant"). 1. Terms. All capitalized...

  • Page 348
    ... Other Changes. From and after the Expansion Date: (a) Tenant's Proportionate Share shall be increased from 21.42% to 24.06%. (b) The number of parking spaces that Tenant is entitled to use pursuant to Section 1.9 of the Lease shall be increased from 30 covered reserved spaces, 90 covered unreserved...

  • Page 349
    ... as specifically modified by this First Amendment, all of the terms and conditions of the Lease continue in full force and effect. TENANT: HEALTH NET OF ARIZONA, INC. an Arizona corporation By /s/ Dennis Bell Its Vice President LANDLORD: CONOCOPHILLIPS COMPANY, a Delaware corporation By /s/ Its

  • Page 350
    ...of May 31, 2004, amends the Office Lease dated July 24, 2003, and the First Amendment to Office Lease dated December 1, 2003 between TOSCO OPERATING COMPANY, INC., a Delaware corporation ("Landlord"), and HEALTH NET OF ARIZONA, INC., an Arizona corporation ("Tenant"). 1. Terms. All capitalized terms...

  • Page 351
    ... Space. 6. Other Changes. From and after the Second Expansion Date: (a) Tenant's Proportionate Share shall be increased from 24.06% to 25.99%. (b) The number of parking spaces that Tenant is entitled to use pursuant to Section 1.10 of the Lease shall be increased from 36 covered reserved spaces, 102...

  • Page 352
    ... by this Second Amendment, all of the terms and conditions of the Lease continue in full force and effect. TENANT: HEALTH NET OF ARIZONA, INC. an Arizona corporation By /s/ Dennis Bell Its Vice President 3 LANDLORD: TOSCO OPERATING COMPANY, INC., a Delaware corporation By /s/ Its Attorney-in-fact

  • Page 353
    ... 13th day of April, 2006, by and between Papago Buttes Corporate, LLC, a Delaware limited liability company ("Landlord") and Health Net of Arizona, Inc., an Arizona corporation ("Tenant"). This Third Amendment is to that certain Office Lease dated July 24, 2003, as amended by the First Amendment to...

  • Page 354
    ... right to terminate the Lease as to the Third Expansion Space, as provided in Section 2.7 of the Lease. The cost for exercising the Option to Terminate as to the Third Expansion Space shall be three (3) months or the Base Rent in effect at the time of termination, plus the total of the unamortized...

  • Page 355
    LANDLORD: PAPAGO BUTTES CORPORATE, LLC, a Delaware limited liability company By: PRINCIPAL REAL ESTATE INVESTORS, LLC, a Delaware limited liability, company, its authorized signatory By: /s/ Kevin P. Anderegg By: TENANT: HEALTH NET OF ARIZONA, INC., an Arizona corporation By: /s/ Dennis Bell Its: ...

  • Page 356
    ... 5th day of June, 2006, by and between Papago Buttes Corporate, LLC, a Delaware limited liability company ("Landlord") and Healthnet of Arizona, Inc., an Arizona corporation ("Tenant"). This Fourth Amendment is to that certain Office Lease dated July 24, 2003, as amended by the First Amendment to...

  • Page 357
    ...and effect, unmodified. In the event of any conflict between the Lease or any Amendment and this Fourth Amendment, this Fourth Amendment shall control. LANDLORD: PAPAGO BUTTES CORPORATE, LLC, a Delaware limited liability company By: Its: TENANT: HEALTH NET OF ARIZONA, INC., an Arizona corporation By...

  • Page 358
    LANDLORD: PAPAGO BUTTES CORPORATE, LLC, a Delaware limited liability company By: PRINCIPAL REAL ESTATE INVESTORS, LLC, a Delaware limited liability company, its authorized signatory By: /s/ John H. Root Its: Investment Director By: /s/ Douglas A. Kintzle Its: Regional Director Asset Management 3

  • Page 359
    Exhibit 10.101 LEASE BETWEEN SAN RAFAEL LAND COMPANY, LLC, AS LANDLORD, AND MANAGED HEALTH NETWORK, INC., AS TENANT February 6, 2008

  • Page 360
    ...PREMISES TERM OPTION TO EXTEND THE TERM BASIC RENT ADDITIONAL RENT TENANT'S RIGHT TO INSPECT RECORDS USE OF THE PREMISES IMPROVEMENT AND ACCEPTANCE OF PREMISES SERVICES MAINTENANCE AND REPAIRS ALTERATIONS COMPLIANCE WITH LAWS AND INSURANCE STANDARDS LIENS AND INSOLVENCY PARKING SIGNS AND ADVERTISING...

  • Page 361
    ...SECURITY DEPOSIT DEFAULTS AND REMEDIES LATE CHARGE TIME QUIET ENJOYMENT TRANSFER OF LANDLORD'S INTEREST RIGHT TO PERFORM NOTICES WAIVER OF RIGHT TO JURY TRIAL ATTORNEYS' FEES SURRENDER OF PREMISES HOLDING OVER NON-WAIVER MORTGAGEE PROTECTION FINANCIAL STATEMENTS CHANGES TO THE PROJECT RIGHT OF FIRST...

  • Page 362
    SAN RAFAEL LAND COMPANY BASIC LEASE INFORMATION Date: Landlord: Tenant: Project: Building: Premises: February 6, 2008 San Rafael Land Company, LLC Managed Health Network, Inc. The property, together with the two office buildings and other improvements being constructed thereon, known as 2350 and ...

  • Page 363
    ... anniversary of the last to occur of the North Wing Commencement Date, Second Floor South Wing Commencement Date or Third Floor South Wing Commencement Date Waived 2008; provided, however, that with respect to Property Taxes, the Base Year shall be the 2008/2009 tax year The ratio which the Rentable...

  • Page 364
    ...contain the Rentable Areas specified for such portions in the Basic Lease Information. The foregoing notwithstanding, no portion of the North Wing, Second...two office buildings on the Project, known as "Building One" and having an address of 2370 Kerner Blvd, San Rafael, California. As of the date of ...

  • Page 365
    ...parties shall promptly complete and execute an acknowledgement of the Commencement Dates and the Term Expiration Date using a Notice of Lease Term Dates in the form of Exhibit E attached hereto. (c) Early Access. Landlord shall provide Tenant and its representatives access to the Building, the North...

  • Page 366
    ...) months prior to the Termination Date; and (ii) No later than thirty (30) days prior to the Termination Date, Tenant shall pay to Landlord a termination payment equal to the sum of: (i) the then unamortized portion of any out-of-pocket costs actually incurred by Landlord associated with the making...

  • Page 367
    ... by Landlord to provide Tenant with such calculation shall not release Tenant from making the termination payment required pursuant to the provisions of Section 2(e)(ii) above, and (ii) Tenant may delay payment of the Termination Fee until the fifth (5th) business day following the date upon which...

  • Page 368
    ... Market Rental Value" shall mean the product of: (i) the Rentable Area of the Premises; multiplied by (ii) the average rental rate per rentable square foot per month (taking into account additional rent and all other monetary payments and considering any base year or expense stop applicable thereto...

  • Page 369
    ... period described in subsection 3(d)(i)(A) above, Landlord and Tenant cannot reach an agreement as to the Fair Market Rental Value, they shall each make a separate determination of the Fair Market Rental Value within five (5) business days after the expiration of the said twenty (20) day period...

  • Page 370
    ... Tenant fails to make such selection with such five (5) business day period, then Landlord shall select the third or single, as the case may be, arbitrator from such list. Each party shall pay the cost of the arbitrator which it first selects and the parties shall share equally the cost of the third...

  • Page 371
    ... this Section 4 ("Basic Rental Rates"). 5. ADDITIONAL RENT. In addition to the Basic Rent provided in Section 4 of this Lease, Tenant shall pay Tenant's Proportionate Share as specified in the Basic Lease Information ( "Tenant's Proportionate Share"), of the increase in Actual Operating Expenses for...

  • Page 372
    ... shall be paid by Landlord to Tenant within thirty (30) days following the date of such statement or, at Landlord's option, credited by Landlord to the payment of rent next due (which amount, if credited, shall be communicated to Tenant in writing). Landlord's failure to give such notice and...

  • Page 373
    ... financing agreements); (viii) management agreements (including the cost of any management fee actually paid thereunder and the fair rental value of any office space provided thereunder, up to customary and reasonable amounts); (ix) wages, salaries and other compensation and benefits (including...

  • Page 374
    unemployment taxes or insurance, and any other taxes which may be levied on such wages, salaries, compensation and benefits; (x) payments under any easement, operating agreement, declaration, restrictive covenant, or instrument pertaining to the sharing of costs in any planned development or similar...

  • Page 375
    ... Taxes (including, without limitation, with respect to an increase in Property Taxes in connection with a change of ownership re-assessment under Proposition 13); (r) the cost of repairs and/or restorations necessitated by condemnation or casualty insured or required to be insured by Landlord under...

  • Page 376
    ... or measured by gross rents received from the rental of space in the Project; and any other costs levied or assessed by, or at the direction of, any federal, state, or local government authority in connection with the use or occupancy of the Project or the Premises or the parking facilities serving...

  • Page 377
    ... by employees of Tenant or by a nationally recognized certified public accounting firm that is not compensated on a contingent fee basis; provided, however, that Tenant may utilize BDO Seidman, LLP or any similar national company, taking into consideration, without limitation, reputation and market...

  • Page 378
    ...of services provided); (ii) offices or agencies of any foreign government or political subdivision thereof; (iii) offices of any health care professionals or service organization, except for administrative offices where no diagnostic, treatment or laboratory services are performed or for health care...

  • Page 379
    ...shall provide access to and use of not less than two (2) passenger elevators in the Building at all times, subject to curtailment or cessation due to the effects of applicable laws, ordinances, rules and regulations, the effects of emergencies, any interruption of utility services, or the effects of...

  • Page 380
    ...of the increased wear and tear on existing equipment caused by such excess consumption; and Landlord may install devices to separately meter any increased use and in such event Tenant shall pay the increased cost directly to Landlord, on demand, including the cost of such additional metering devices...

  • Page 381
    ... loss of business) if Tenant's telecommunications services in any way are interrupted, damaged or rendered less effective, except to the extent such claims arise out of the gross negligence or willful misconduct of Landlord, or Landlord's employees, agents or contractors. (b) Limited Tenant Offset...

  • Page 382
    ... within such period of seven (7) business days, Landlord has not commenced the efforts necessary for such performance or has not thereafter diligently pursued such efforts), Tenant may provide Landlord an additional notice containing the information and statements required with respect to Tenant...

  • Page 383
    ... indemnity to include, but without limitation, the obligation to provide all costs of defense against any such claims; provided, however, that the foregoing indemnity shall not be applicable to claims, proceedings, loss, cost, damage, causes of action, liabilities, injury or expense to the extent...

  • Page 384
    ... be employed on the work of such Alterations. (c) Performance of Work. All Alterations shall be made at Tenant's sole expense and by contractors or mechanics reasonably acceptable to Landlord. All Alterations shall be made at such times and in such manner as Landlord may from time to time designate...

  • Page 385
    ..., additions or improvements which are beyond the normal services provided to occupants of the Building. Tenant shall also pay to Landlord an administration fee equal to three percent (3%) of the cost of the work to compensate Landlord for the administrative costs incurred in the review, approval...

  • Page 386
    ... from any liens or encumbrances of any kind or nature arising out of any work performed, materials ordered or obligations incurred by or on behalf of Tenant. If Tenant becomes insolvent, makes an assignment for the benefit of creditors, or if legal proceedings are instituted seeking to have Tenant...

  • Page 387
    ...'s approval prior to Landlord incurring such costs and expenses. Following the date such Additional Parking Privileges are provided to Tenant for Tenant's use, Tenant shall pay to Landlord, on a monthly basis and in advance, the then prevailing market rate for such Additional Parking Privileges...

  • Page 388
    ... any other local, state or federal governmental agency or authority hereafter imposes any traffic systems management program which applies to the Building or Tenant, Tenant shall cooperate reasonably with the requirements of such program. 15. SIGNS AND ADVERTISING. Landlord shall provide Tenant, at...

  • Page 389
    ... business history; (B) if the proposed sublessee or assignee intends to use the Premises for executive suites or for any use which would materially increase the density of occupants of the Premises: (C) any other use inconsistent with Section 6 or the operation of a first-class office building...

  • Page 390
    ... and reasonable out-of-pocket costs incurred by Tenant in connection with such Sublease (including, but not limited to, brokerage commissions, legal fees, improvement allowances, rent abatements and rent paid during vacancy); (iii) In the case of an Assignment, Tenant shall pay to Landlord, as and...

  • Page 391
    ...Sublease, including Landlord's reasonable attorneys' fees and the costs of investigating the acceptability of any proposed Transferee; provided, however, that if the documents and supporting data will only require the preparation, delivery and execution of Landlord's standard form of consent to such...

  • Page 392
    ... by effective provisions contained in the instruments of merger or consolidation, the liabilities of the corporations participating in such merger or consolidation are assumed by the corporation surviving the merger or created by such consolidation; (ii) any partnership or limited liability company...

  • Page 393
    ...such increase in the assessment. 18. ENTRY BY LANDLORD. (a) After reasonable prior notice (except in emergencies, where no such notice shall be required) and without materially interfering with Tenant's use and access to the Premises, Landlord, its authorized agents, contractors, and representatives...

  • Page 394
    ...such coverage is included in a customary and typical policy of commercial general liability insurance) and shall (i) name Landlord as an additional insured, (ii) contain a cross-liability provision, and (iii) contain a provision that the insurance provided the landlord hereunder shall be primary and...

  • Page 395
    ... policy of Commercial General Liability insurance with the premiums thereon fully paid in advance, issued by and binding upon an insurance company of good financial standing, insuring Landlord against any liability arising out of the lease, use, occupancy, or maintenance of the Project and all areas...

  • Page 396
    ... use) in an occurrence. (ii) In addition, Landlord shall maintain, or cause to be maintained, a policy or policies of insurance with the premiums thereon fully paid in advance, issued by and binding upon an insurance company of good financial standing, insuring the Project against loss or damage by...

  • Page 397
    ...Premises are damaged by fire or other perils covered by insurance carried by Landlord, Landlord shall, subject ...estimate of Landlord, be repaired, reconstructed and restored within six (6) months from the date of such damage or destruction using customary diligence, Landlord shall, at its sole option...

  • Page 398
    ...impaired during the period of such repair, reconstruction or restoration; provided, however, that the amount of such abatement shall be limited to the amount recoverable by Landlord from applicable policies of rental loss insurance maintained or required to be maintained by Landlord pursuant to this...

  • Page 399
    ... or payment. (d) Waiver. Except as may be otherwise provided herein, Tenant hereby waives and releases any right to terminate this Lease under Sections 1265.120 and 1265.130 of the California Code of Civil Procedure or under any similar law, statute or ordinance now or hereafter in effect relative...

  • Page 400
    ... hold Landlord, its members, employees, agents, consultants, independent contractors, guests, invitees and other representatives (collectively, the "Landlord Parties") harmless from and against all claims, losses, liabilities, damages, costs, expenses and claims arising from or relating to the use...

  • Page 401
    ... hereunder would be covered by the proceeds of liability insurance maintained by Landlord or required to be maintained by Landlord under this Lease, such indemnity to include, but without limitation, the obligation to provide all costs of defense against any such claims; provided, however, that the...

  • Page 402
    ..., provided that the use of such products in the Premises by Tenant shall be in compliance with applicable laws and shall be in the manner in which such products are designed to be used. In addition, Tenant shall execute affidavits, representations and the like from time to time at Landlord's request...

  • Page 403
    ... Landlord releases Tenant from any liability for, waives all claims against Tenant and shall indemnify, defend and hold harmless Tenant, its officers, employees, and agents, against any and all claims, liabilities, damages, costs and expenses, including reasonable attorneys' fees and costs incurred...

  • Page 404
    ... an exercise of a power of sale or by deed expressly in lieu of foreclosure shall not: (i) have any liability for any act, omission, default or breach by Landlord under this Lease occurring prior to the time of such acquisition by such lender or person (provided such act, omission, default or breach...

  • Page 405
    ... (15) days prior request by Landlord, execute, acknowledge and deliver to Landlord a statement in writing executed by Tenant, substantially in the form of Exhibit F attached hereto, certifying, among other things, the date of this Lease, that this Lease is unmodified and in full force and effect (or...

  • Page 406
    ... to one hundred ten percent (110%) of the amount specified in the Basic Lease Information as the same may have been increased by prior applications of this Section 29. Tenant's failure to make such payment to Landlord within five (5) days of Landlord's notice shall constitute an Event of Default...

  • Page 407
    ...however, that any such notice shall be in lieu of, and not in addition to, any notice required under California Code of Civil Procedure § 1161 regarding unlawful detainer actions. (ii) The failure by Tenant to observe or perform any of the express or implied covenants or provisions of this Lease to...

  • Page 408
    ... by discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award plus one percent (1%); (iii) The rights and remedies provided by California Civil Code Section 1951.4, that allow Landlord to continue this Lease in effect and to enforce all of its...

  • Page 409
    ... to make any other payment for which Tenant is obligated under this Lease, then Tenant shall pay to Landlord a late charge equal to five percent (5%) of the amount so payable; provided, however, that Tenant shall pay no late fee for the first such late payment in any twelve (12) month period during...

  • Page 410
    ... J. Dickman San Rafael Land Company, LLC 303 West Wall Avenue, Suite 1900 Midland, Texas 79701-5116 Telephone No.: (432) 687-1777 Ext 1804 Facsimile No.: (432) 687-0669 Managed Health Network, Inc. c/o Health Net, Inc. Post Office Box 2470 Rancho Cordova, California 95741-2470 Attention: Director of...

  • Page 411
    ...Rent, additional rent or other charges or sums due or to become due hereunder, or recovery of the possession of the Premises, in the hands of an attorney, or files suit upon the same, the non-prevailing (or defaulting) party shall pay the other party's reasonable legal and attorneys' fees, costs and...

  • Page 412
    ..., claim, cost or expense (including attorneys' fees) resulting from or caused by Tenant's failure in so surrendering the Premises in such manner or condition, including, without limitation, any claims made by any succeeding tenant due to such failure, provided that such indemnity shall be effective...

  • Page 413
    ... date of such written request, certified as accurate by Tenant, reflecting Tenant's then current financial condition, in such form and detail as is prepared by Tenant in its ordinary course of business. 44. CHANGES TO THE PROJECT. Landlord reserves the right at any time to make changes, alterations...

  • Page 414
    ... as the North Wing (E-1) ("Offering Space"). (b) Terms of Advice. Prior to the time Landlord offers the Offering Space for lease to a third-party (other than to an existing tenant of such Offering Space, or a party holding a right of first offer, right of first refusal, expansion option or other...

  • Page 415
    ... performing work or services on behalf of Tenant with respect to such Alterations. The other provisions of this Section 45(e) notwithstanding: (i) Landlord shall not be required to pay any part of the Offering Space Alterations Allowance on or following the eighteen (18) month anniversary...

  • Page 416
    ... agreement with respect to the payment of a commission in connection with this transaction. Landlord hereby agrees to indemnify, defend and hold Tenant harmless from claims for any commission or finder's fee charges by any real estate broker or other person or entity (including, without limitation...

  • Page 417
    ...affiliate of Landlord or pursuant to a management agreement with a third-party manager. Any management agreement with a third-party manager shall provide that such manager shall operate the Building in a first-class institutional manner and in the most cost-effective manner possible, in an effort to...

  • Page 418
    ... Applicable Laws. This Lease shall be governed by and construed pursuant to the laws of the State of California. (r) OFAC Certification. Tenant represents and warrants that Tenant is not acting, directly or indirectly, for or on behalf of any person, group, entity, or nation named by any Executive...

  • Page 419
    ...request shall be reasonable and made in good faith. (x) HIPAA. Landlord agrees that from time to time during the Term, Landlord, its agents, employees or assigns, may be exposed to, or have access to, Protected Health Information ("PHI"), as defined by Health Insurance Portability and Accountability...

  • Page 420
    ... parties hereto have executed this Lease as of the date first above written. TENANT: Managed Health Network, Inc., a Delaware corporation By: /s/ Dennis Bell Name: Dennis Bell Title: Vice President Real Estate Management LANDLORD: San Rafael Land Company, LLC, a California limited liability company...

  • Page 421
    ... THIS FIRST AMENDMENT TO OFFICE LEASE (this "First Amendment") is entered into as of the 17 th day of December, 2008, by and between SAN RAFAEL LAND COMPANY, LLC, a California limited liability company ("Landlord"), and MANAGED HEALTH NETWORK, INC., a Delaware corporation ("Tenant"). RECITALS This...

  • Page 422
    ...; (ii) appropriate governmental authorities have signed the permit card or otherwise indicated clearance for temporary or permanent occupancy of the Expansion Premises; and (iii) all Building systems and equipment are operational to the extent necessary to service the Expansion Premises. Landlord...

  • Page 423
    ... Commencement Date, Section 1(c)(i)(A) of the Lease shall be amended in its entirety to provide as follows: " 'Rentable Area' of the Premises shall be the product of: (x) the 'usable area' of the Premises, as calculated pursuant to the Standard Method for Measuring Floor Area in Office Buildings...

  • Page 424
    ... request of the other, shall execute a declaration specifying the Expansion Premises Commencement Date within a reasonable period of time following the Expansion Premises Commencement Date. (c) Tenant has inspected the Expansion Premises and agrees to accept the same "AS IS" without any agreements...

  • Page 425
    ... and loading docks, or the cost of utilities or temporary heating, ventilating and air conditioning provided by Landlord to the Expansion Premises during such early access or entry period), including, without limitation, obligations pertaining to insurance, indemnity, compliance with laws and...

  • Page 426
    ... of the Rentable Area of the Existing Premises as provide in Section 3 above, effective retroactively as of the North Wing Commencement Date, Tenant shall pay Basic Rent at the rates set forth in the following table and otherwise in the manner provided under the Lease: Monthly Rate per Square Foot...

  • Page 427
    ...shall be deemed to mean the Tenant Improvement Allowance. In addition, effective retroactively as of the date of the Lease, the second to last row of the Basic Lease Information describing the Tenant Improvement Allowance shall be amended in its entirety to provide as follows: "Tenant Improvement An...

  • Page 428
    ...parties hereto have executed this First Amendment as of the date first above written. TENANT: Managed Health Network, Inc., a Delaware corporation By: /s/ Dennis Bell Name: Dennis Bell Title: Vice President Real Estate Management LANDLORD: San Rafael Land Company, LLC, a California limited liability...

  • Page 429
    Exhibit 10.103 OFFICE LEASE by and between GK TRIANGLE CORPORATE PARK III, LLC, ("Landlord") and HEALTH NET HEALTH PLAN OF OREGON, INC., ("Tenant") Dated as of March 18, 2009

  • Page 430
    ... Addendum Four Floor Plan(s) Legal Description of the Project Work Letter Utilities and Services Building Rules and Regulations Form Estoppel Certificate Tenant Commencement Certificate ADA One Renewal Option (Market) Right of First Offer Termination Option Contraction Option (including Schedule One...

  • Page 431
    ...LEASE THIS OFFICE LEASE is made between GK TRIANGLE CORPORATE PARK III, LLC, a Delaware limited liability company ("Landlord"),... 3. Tenant: Building: Description of Premises: Rentable Area: HEALTH NET HEALTH PLAN OF OREGON, INC., an Oregon corporation ("Tenant") 13221 SW 68th Parkway Tigard, OR 97223...

  • Page 432
    ...Monthly Installment: Months 61 to 72, inclusive: Monthly Installment: Months 73 to 84, inclusive: Monthly Installment: 6. 7. 8. 9. 10. 11. 12. Installment Payable Upon Execution: Security Deposit Payable Upon Execution: Base Year for Operating Costs: Initial Term: Commencement Date: Termination Date...

  • Page 433
    13. 14. Number of Parking Spaces: Addresses for Notices: To: TENANT: Health Net Health Plan of Oregon, Inc. c/o Health Net, Inc. P. O. Box 2470 Rancho Cordova, CA 95791-2410 Attn: Director of Real Estate Four (4) uncovered, unreserved parking spaces per 1,000 feet of Rentable Area in the Premises,...

  • Page 434
    ... Date, other than the payment of Basic Annual Rent, in the same manner as if delivery had occurred on the Commencement Date. (c) INTENTIONALLY DELETED (d) The parties agree that for all purposes hereunder the Premises shall be stipulated to contain the number of square feet of Rentable Area...

  • Page 435
    ... Any form of assessment, license fee, license tax, business license fee, commercial rental tax, levy, charge, improvement bond, tax, water and sewer rents and charges, utilities and communications taxes and charges or similar or dissimilar imposition imposed by any authority having the direct power...

  • Page 436
    ... in the Area); the cost of compensation, including employment, welfare and social security taxes, paid vacation days, disability, pension, medical and other fringe benefits of all persons (including independent contractors) at or below the level of Project Manager who perform services connected with...

  • Page 437
    ...: attorney fees, transfer taxes, escrow fees, title insurance fees and costs, and other similar expenses, but expressly excluding any increase in taxes or assessments related to a reappraisal or increase in valuation of the Project due to a sale of the Project; (O) any new category of costs and...

  • Page 438
    ... Operating Costs over Base Operating Costs for such period and the parties shall, within thirty (30) days thereafter, make any payment or allowance necessary to adjust Tenant's estimated payments to Tenant's actual share of such excess as indicated by such annual statement. Any payment due Landlord...

  • Page 439
    ... shall credit such excess to Tenant's next payment of Operating Costs or, at the request of Tenant, promptly refund such excess to Tenant and conversely, if Tenant has underpaid Tenant's Proportionate Share of Operating Costs, Tenant shall promptly pay such additional Operating Costs to Landlord...

  • Page 440
    ... provide certificates of insurance for worker's compensation and other coverage in amounts and from an insurance company reasonably satisfactory to Landlord protecting Landlord against liability for bodily injury or property damage during construction. Tenant shall pay to Landlord, as additional...

  • Page 441
    ... such written notice to Landlord, may at its option proceed forthwith to make such repairs for such Emergency and pay the cost thereof; provided, however, Tenant shall use reasonable efforts to notify Landlord and its management company prior to proceeding to make any repairs to the Premises in an...

  • Page 442
    ...) or Common Areas are determined by applicable governmental agencies to not be in compliance with Laws applicable to the Project as of the Commencement Date, then Landlord shall be fully responsible, at its sole cost and expense (which shall not be included in Operating Costs), for making all...

  • Page 443
    ... or increase the cost of any fire, All Risk or other insurance policy covering the Building, the Project and/or property located therein and shall comply with all rules, orders, regulations and requirements of the appropriate fire codes and ordinances or any other organization performing a similar...

  • Page 444
    ... reasonable attorneys' fees and costs incurred in connection with monitoring or review of such Remedial Work. (iv) To Landlord's knowledge and subject to all matters disclosed in that certain Phase I Environmental Report dated July 18, 2005 prepared by Environ International Corporation, Landlord has...

  • Page 445
    ... management company, and their respective partners, members, affiliates and subsidiaries, and all of their respective officers, directors, shareholders, employees, servants, partners, representatives, insurers and agents (collectively, "Landlord Indemnitees") for, from and against all liabilities...

  • Page 446
    ... under insurance policies, workers' compensation acts, disability benefit acts or other employees' benefit acts. (d) Insurance. (i) Tenant at all times during the Lease Term shall, at its own expense, keep in full force and effect (A) commercial general liability insurance providing coverage against...

  • Page 447
    COMMERCIAL GENERAL LIABILITY POLICY) SHALL INCLUDE AN ENDORSEMENT PROVIDING THAT INSURER SHALL ENDEAVOR TO PROVIDE LANDLORD WITH THIRTY (30) DAYS (OR, TEN (10) DAYS, IN THE EVENT OF NON-PAYMENT OF PREMIUM) PRIOR WRITTEN NOTICE OF ANY CANCELLATION OF, NONRENEWAL OF, REDUCTION OF COVERAGE OR MATERIAL ...

  • Page 448
    ... claim pertaining to the Building or the Project or Landlord's use thereof. (h) Increase in Landlord's Insurance Costs. Tenant agrees to pay to Landlord any increase in premiums for Landlord's insurance policies resulting from Tenant's use or occupancy of the Premises for other than general office...

  • Page 449
    ... full force and effect and Tenant shall continue to perform each of its obligations under this Lease; in such case, Tenant shall be entitled to receive the entire award allocable to the temporary Taking of the Premises. Except as provided herein, Tenant shall not assert any claim against Landlord or...

  • Page 450
    ... provides written notice of the assignment or sublease to Landlord within twenty (20) days of the effective date thereof. The term "controlled by" or "commonly controlled with" shall mean the possession, direct or indirect, of the power to direct or cause the direction of the management and policies...

  • Page 451
    ... provisions or a release of Tenant from the further performance by Tenant of its covenants, duties, or obligations hereunder. (g) If Tenant effects an assignment or sublease or requests the consent of Landlord to any proposed assignment or sublease, then Tenant shall, upon demand, pay Landlord a non...

  • Page 452
    ...of emergencies, in which such case, such shorter period of time as is reasonable under the circumstances) after Tenant's receipt of written notice thereof from Landlord, Landlord may, without waiving or releasing Tenant from any of Tenant's obligations, make such payment or perform such other act on...

  • Page 453
    ... by the due date thereof, Tenant shall pay to Landlord an additional sum of five percent (5%) of the overdue amount as a late charge, but in no event more than the maximum late charge allowed by law; provided, however, that as to the first (1 st) late payment in any twelve (12) month period during...

  • Page 454
    ... or if Tenant makes an assignment for the benefit of creditors, this Lease, at the option of Landlord exercised within a reasonable time after notice of the happening of any one or more of such events, may be canceled and terminated and in such event neither Tenant nor any person claiming through or...

  • Page 455
    ... limitation, attorneys' fees and disbursements) resulting from such default, and (z) provides adequate assurance of future performance under this Lease, it being covenanted and agreed by the parties that, for such purposes, any cure or compensation shall be effected by the immediate payment of...

  • Page 456
    ... and effect as modified and stating the modifications), (ii) the dates to which the Basic Annual Rent, Additional Rent and other charges hereunder have been paid, if any, and (iii) whether or not to the best knowledge of Tenant, Landlord is in default in the performance of any covenant, agreement or...

  • Page 457
    ... the use of the parking areas. Landlord further reserves the right to make such changes to the parking system as Landlord may deem necessary or reasonable from time to time; i.e., Landlord may provide for one or a combination of parking systems, including, without limitation, self-parking, single or...

  • Page 458
    ..., without limitation, constructing new buildings and making changes in the location, size, shape and number of driveways, entrances, parking spaces, parking areas, loading areas, landscaped areas and walkways; provided, however, that there shall be no unreasonable permanent obstruction of access to...

  • Page 459
    ... right or option) shall be applicable during such holdover period, except that Tenant shall pay Landlord from time to time, upon demand, as Basic Annual Rent for the holdover period, an amount equal to (i) 125% of the Basic Annual Rent in effect on the termination date, computed on a monthly basis...

  • Page 460
    ...'s request, Tenant shall join in the execution of any of the aforementioned documents. (j) Successors and Assigns. Except as otherwise provided in this Lease, all of the covenants, conditions and provisions of this Lease shall be binding upon and shall inure to the benefit of the parties hereto...

  • Page 461
    ... of Laws; Prior Agreements; Separability. This Lease shall be governed by and construed pursuant to the laws of the State of Oregon. This Lease contains all of the agreements of the parties hereto with respect to any matter covered or mentioned in this Lease. No prior agreement, understanding or...

  • Page 462
    ... or more thereof) shall sign this Lease as Tenant, the liability of each such individual, corporation, partnership or other business association to pay Rent and perform all other obligations hereunder shall be deemed to be joint and several, and all notices, payments and agreements given or made by...

  • Page 463
    ..., without limiting the foregoing, no default or failure of Provider with respect to any such services, equipment or facilities, or under any contract or agreement relating thereto, shall have any effect on this Lease or give to Tenant any offset or defense to the full and timely performance of its...

  • Page 464
    ... other party, such demand or request shall be reasonable and made in good faith. (gg) HIPAA. Landlord agrees that from time to time during the Term, Landlord, its agents, employees, or assigns, may be exposed to, or have access to, Protected Health Information ("PHI"), as defined by Health Insurance...

  • Page 465
    ...effective as of the Date of this Lease. "LANDLORD" GK TRIANGLE CORPORATE PARK III, LLC, a Delaware limited liability company By: KBS Realty Advisors, LLC, a Delaware limited liability company, as agent By: /s/ Steve Silva Steve Silva Senior Vice President 35 "TENANT" HEALTH NET HEALTH PLAN OF OREGON...

  • Page 466
    ADDENDUM ONE ONE RENEWAL OPTION AT MARKET ATTACHED TO AND A PART OF THE LEASE AGREEMENT BY AND BETWEEN GK TRIANGLE CORPORATE PARK III, LLC, and HEALTH NET HEALTH PLAN OF OREGON, INC. (a) Provided that as of the time of the giving of the Extension Notice and the Commencement Date of the Extension ...

  • Page 467
    ...shall be on the same terms and conditions as are in effect immediately prior to the expiration of the initial Lease Term; provided, however, Tenant shall have no further right to any allowances, credits or abatements or any options to expand, contract, terminate, renew or extend the Lease, except as...

  • Page 468
    ..., and HEALTH NET HEALTH PLAN OF OREGON, INC. (a)) "Offered Space" shall mean that 22,220 square foot portion on the first floor of the Building and that 11,237 square foot portion of the third floor of the Building as more particularly described on Schedule 1 to this Addendum Two. (b) Provided that...

  • Page 469
    ... exercises its rights to any Offered Space pursuant to this Addendum Two, then Landlord shall prepare, and Tenant shall execute, a commercially reasonable form of amendment to the Lease which confirms such expansion of the Premises and the other provisions applicable thereto (the "Amendment"). TWO-2

  • Page 470
    ... THREE TERMINATION OPTION ATTACHED TO AND A PART OF THE LEASE AGREEMENT BY AND BETWEEN GK TRIANGLE CORPORATE PARK III, LLC, and HEALTH NET HEALTH PLAN OF OREGON, INC. Provided no event of default shall then exist under the Lease and no condition shall then exist which with the passage of time or...

  • Page 471
    ... FOUR CONTRACTION OPTION ATTACHED TO AND A PART OF THE LEASE AGREEMENT BY AND BETWEEN GK TRIANGLE CORPORATE PARK III, LLC, and HEALTH NET HEALTH PLAN OF OREGON, INC. Provided no event of default shall then exist under the Lease and no condition shall then exist which with the passage of time or...

  • Page 472
    ... 1, 2009 (the "Effective Date"), by and between GK TRIANGLE CORPORATE PARK III, LLC, a Delaware limited liability company ("Landlord"), and HEALTH NET HEALTH PLAN OF OREGON, INC., an Oregon corporation ("Tenant"). W I T N E S S E T H: WHEREAS, Landlord and Tenant are parties to that certain Office...

  • Page 473
    ... forth in the Lease for any claim for personal injury or property damage arising prior to the Contraction Date. Tenant shall also be responsible for any additional rent reimbursable with respect to the Contraction Area that may be due, when the actual Operating Costs for the calendar year 2010 for...

  • Page 474
    ... 00/100 Dollars ($708,464.00). Additional Rent. Subject to Paragraph 2 above, Tenant shall continue to pay all items of additional rent as set forth in the Lease. Contraction Option. By virtue of Tenant's exercise of its Contraction Option, as of the Effective Date, Addendum Four to the Lease is of...

  • Page 475
    ... the Effective Date. LANDLORD: GK TRIANGLE CORPORATE PARK III, LLC, a Delaware limited liability company By: KBS Realty Advisors, LLC, a Delaware limited liability company, as agent By: /s/ Steve Silva Steve Silva, Senior Vice President Date: 12/23, 2009 TENANT: HEALTH NET HEALTH PLAN OF OREGON, INC...

  • Page 476
    ... by and among HEALTH NET, INC., HEALTH NET OF THE NORTHEAST, INC., HEALTH NET LIFE INSURANCE COMPANY, UNITEDHEALTHCARE INSURANCE COMPANY, OXFORD HEALTH PLANS, LLC, OXFORD HEALTH INSURANCE, INC. and UNITEDHEALTH GROUP INCORPORATED, SOLELY WITH RESPECT TO SECTION 4.8(b) AS GUARANTOR December 11, 2009

  • Page 477
    ... OF MEMBERSHIP Section 2.1. Transition of Members Section 2.2. Transition Efforts Section 2.3. Compensation Section 2.4. Reporting Section 2.5. Excluded Business ARTICLE III. COMMUNICATIONS Section 3.1. Communication Plan Section 3.2. Notice of Transition Section 3.3. Mailings ARTICLE IV. ADDITIONAL...

  • Page 478
    ...A B Communication Plan Forms of Termination Notice, Member Materials and Broker/Consultant Materials 18 18 18 18 18 19 SCHEDULES 2.1(a) 2.2(d) 2.4(a)(i) 2.4(a)(ii) 4.6(a) Transition Schedule Specified Vendors and Providers Form of Additional Enrollment Report Information Form of Accumulator Report...

  • Page 479
    ... corporation ("Seller"), Health Net Life Insurance Company, a California corporation ("HN Life"), Oxford Health Plans, LLC, a Delaware limited liability company ("Buyer"), UnitedHealthcare Insurance Company, a Connecticut stock insurance company ("UHIC"), Oxford Health Insurance, Inc., a New York...

  • Page 480
    ... mean claims files, underwriting files, contract form files, rate files and filings, enrollment files, billing files, actuarial support files, premium receivable files and enrollment census information regarding the Membership under the HN Life Health Plan Contracts in the Applicable States, whether...

  • Page 481
    ... all Employer Groups sitused in the Applicable States which contract to provide health benefits on behalf of their eligible employees, members or beneficiaries who are enrolled pursuant to HN Life Health Plan Contracts, consistent with HN Life's past practices, as of or following the Effective Date...

  • Page 482
    ... Effective Date. "Membership" shall mean the commercial group (large and small) membership enrolled by HN Life pursuant to HN Life Health Plan Contracts issued to HN Life Employer Groups sitused in the Applicable States. The Membership shall include all Members under a HN Life Health Plan Contract...

  • Page 483
    ... the Applicable States in accordance with the Communication Plan and Transition Schedule as soon as practicable after the Effective Date. During the Transition Period, United and its Affiliates shall not offer or sell Fully Insured Contracts to Members or HN Life Employer Groups or enroll Members or...

  • Page 484
    ... or HN Life Employer Groups of, or enrollment of Members or HN Life Employer Groups in, vision, dental, pharmacy, behavioral health or any other products other than contracts or plans for the provision of Fully Insured Contracts. Section 2.2. Transition Efforts. (a) From and after the Effective Date...

  • Page 485
    ... to do business with the Legacy United Entities in the Applicable States. (c) In accordance with the Transition Schedule, the Parties shall use commercially reasonable efforts to transfer each HN Life Employer Group's health care benefits provided by HN Life and the Acquired Companies as a whole...

  • Page 486
    .... The Communication Plan shall also include (a) a schedule of mailing dates of letters of termination and introduction, which mailing dates shall comply with policy language and requirements of applicable Law, and (b) information that may be provided to HN Life Employer Groups, Members and Brokers...

  • Page 487
    ... in accordance with the Communication Plan and Transition Schedule, HN Life shall deliver to every HN Life Employer Group and Member a notice (the "Termination Notice") that their HN Life Health Plan Contract will be terminated or non-renewed as soon as permitted by applicable Law. To the extent...

  • Page 488
    ...not to enroll any HN Life Employer Group or Member upon expiration of the applicable HN Life Health Plan Contract. United and HN Life agree to cooperate with each other with respect to the timing and content of such non-renewal and, if requested, cancellation notifications to the Membership in order...

  • Page 489
    ... the sale of HN Life Health Plan Contracts shall be the sole responsibility of Parent, Seller and HN Life. United shall send HN Life retroactive membership information following the transfer of HN Life Employer Groups to Legacy United Entities' Plans (to allow HN Life to apply any membership changes...

  • Page 490
    ... employee's normal compensation in effect from time to time or (B) make any non-monetary change to their employment practices. Except as provided in this Agreement, HN Life shall not terminate existing contracts with self-funded HN Life Employer Groups, if any, following the Effective Date without...

  • Page 491
    ..., and the officers, directors, employees, agents, consultants and advisors (each a "Representative") of each Party and their respective Affiliates, in each case, who reasonably require such information in order to perform their duties in connection with the services provided hereunder), directly or...

  • Page 492
    ... any additional assistance, information and documents as may be reasonably requested by a Party from time to time. If, at any time after the Effective Date, any further action is necessary or desirable to effectuate the purposes of this Agreement, each Party, as the case may be, shall execute and...

  • Page 493
    ...return receipt requested), and on the next Business Day when sent by overnight courier service, to the Parties at the following addresses (or at such other address for a Party as shall be specified by like notice): (a) to Seller and HN Life at: Health Net, Inc. 21650 Oxnard Street Woodland Hills, CA...

  • Page 494
    ...: General Counsel Facsimile: 952.936.0044 Attention: Vice President, Corporate Development Facsimile: 952.936.3007 Oxford Health Plans, LLC One Penn Plaza New York, NY 10019 Facsimile: (203) 459-7171 Attention: Northeast Region Chief Executive Officer Dorsey & Whitney LLP Suite 1500 50 South Sixth...

  • Page 495
    ... obligations of HN Life or Seller (as applicable) under this Agreement. Section 8.6. Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by and construed in accordance with the internal laws of the state of New York applicable to agreements made and to be...

  • Page 496
    ...this Agreement refers to a number of days, such number shall refer to calendar days unless Business Days are specified. Section 8.14. Duration. This Agreement shall commence as of the Effective Date and shall continue in effect until the termination date of the final HN Life Health Plan Contract and...

  • Page 497
    ..., the Parties have caused this Agreement to be executed by their respective duly authorized officers, as of the Effective Date. UNITEDHEALTH GROUP INCORPORATED /s/ G. Mike Mikan By: Name: G. Mike Mikan Title: Executive Vice President and Chief Financial Officer UNITED HEALTHCARE INSURANCE COMPANY...

  • Page 498
    HEALTH NET, INC. /s/ Jay M. Gellert By: Name: Jay M. Gellert Title: President and Chief Executive Officer Signature Page to Business Transition Agreement

  • Page 499
    HEALTH NET OF THE NORTHEAST, INC. /s/ Paul Lambdin By: Name: Paul Lambdin Title: President Signature Page to Business Transition Agreement

  • Page 500
    HEALTH NET LIFE INSURANCE COMPANY /s/ Steven J. Sell By: Name: Steven J. Sell Title: President Signature Page to Business Transition Agreement

  • Page 501
    ..., Health Net of the Northeast, Inc., a Delaware corporation, Oxford Health Plans, LLC, a Delaware limited liability company and, solely with respect to Section 8.16, UnitedHealth Group Incorporated, a Minnesota corporation, have entered into a Stock Purchase Agreement, dated as of July 20, 2009...

  • Page 502
    ... all registered marks used in the Business as of the Closing Date. Parent agrees to indemnify, hold harmless and defend each Acquired Company against any third party claim, demand, cause of action, debt, expense or liability (including reasonable attorney's fees and costs), to the extent that it is...

  • Page 503
    ... with applicable state-level department of insurance requirements), (c) refer to the historical fact that the Acquired Companies have previously conducted their respective businesses under the Licensed Marks; and (d) use as minimally required for the administration of the Administered Contracts and...

  • Page 504
    ...and 7 shall survive the termination of this Agreement. 6. Limitation of Liability. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, IN NO EVENT SHALL PARENT BE LIABLE TO THE ACQUIRED COMPANIES, OR TO ANY THIRD PARTY CLAIMING THROUGH OR UNDER THE ACQUIRED COMPANIES, FOR ANY LOST PROFITS, OR FOR ANY...

  • Page 505
    ...-1611 Facsimile: (952) 992-5250 Attention: Chief Financial Officer & General Counsel and Oxford Health Plans, LLC One Penn Plaza New York, NY 10019 Facsimile: (203) 459-7171 Attention: Northeast Region Chief Executive Officer and UnitedHealth Group Incorporated 9900 Bren Road East Minnetonka, MN...

  • Page 506
    ... the prior written consent of the other parties, which shall not be unreasonably withheld or delayed. 7.6. Governing Law; Submission to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by and construed in accordance with the internal laws of the state of New York applicable to...

  • Page 507
    ...Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but in case...limitation". Whenever this Agreement refers to a number of days, such number shall refer to calendar days unless Business Days are specified. 7.12. Counterparts. This Agreement may be executed...

  • Page 508
    IN WITNESS WHEREOF, the parties hereto have signed this Transitional Trademark License Agreement effective as of the Closing Date first set forth above. PARENT: HEALTH NET, INC. By: /s/ Jay M. Gellert Name: Jay M. Gellert Title: President and Chief Executive Officer Signature Page to Transitional ...

  • Page 509
    ACQUIRED COMPANIES: HEALTH NET OF CONNECTICUT, INC. /s/ Paul Lambdin By: Name: Paul Lambdin Title: President HEALTH NET OF NEW YORK, INC. /s/ Anju Sikka, M.D. By: Name: Anju Sikka, M.D. Title: President HEALTH NET INSURANCE OF NEW YORK, INC. /s/ Steven J. Sell By: Name: Steven J. Sell Title: ...

  • Page 510
    FOHP, INC. /s/ Paul Lambdin By: Name: Paul Lambdin Title: President HEALTH NET OF NEW JERSEY, INC. /s/ Paul Lambdin By: Name: Paul Lambdin Title: President HEALTH NET SERVICES (BERMUDA) LTD. By: HEALTH NET OF THE NORTHEAST, INC. By: /s/ Steven J. Sell Name: Steven J. Sell Title: President Signature ...

  • Page 511
    ...A Better Decision, including U.S. Reg. No. 3,514,033 Decision Power, including U.S. Reg. No. 3,136,525 Health Net, including U.S. Reg. Nos. 2,927,099, 1,147,331 HN (logo), including U.S. Reg. No. 2,729,... other common law marks and domain names in use by the Acquired Companies as of the Closing Date.

  • Page 512
    ... provisions regarding Medicaid products, plans, or businesses found herein. The Administrative Services Agreements of Health Net of Connecticut, Inc., Health Net of New York, Inc. and Health Net of New Jersey, Inc. do not contain the provisions regarding the Joint Medicare PDP Contract found herein...

  • Page 513
    ... ARTICLE VIII. MISCELLANEOUS SERVICES Section 8.1. Contract Holder and Customer Services Section 8.2. Brokers/Consultants Section 8.3. Call-Centers; Inquiries and Complaints Section 8.4. Utilization Management Section 8.5. Coordination of Benefits Section 8.6. Risk Management 1 7 7 8 8 9 10 10 10...

  • Page 514
    ... 9.1. Provider Network Access Section 9.2. Filings Section 9.3. Joint Medicare PDP Contract. Section 9.4. Vendor Agreements. ARTICLE X. REGULATORY MATTERS AND REPORTING Section 10.1. Regulatory Compliance and Reporting Section 10.2. Financial Reporting and Accountings Section 10.3. Monthly Reports...

  • Page 515
    ...and Abuse Plan Investment Policy Subcontractors Premiums Monthly Premium-by-State Report Health Assessments Monthly Accounting Reserves Calculation and Methodology Income Statements Business Transition Services Record Retention Policy Joint Operating Representatives Claims Servicing Agreement 39 39...

  • Page 516
    ...with respect to the Business and the Administered Contracts during the period between the Effective Date and the wind down of the Company, and the Administrator desires to provide such administrative services; and WHEREAS, this Administrative Services Agreement, duly executed by the Parties, must be...

  • Page 517
    ... throughout this Administrative Services Agreement: "Administered Contracts" shall mean the Insurance/HMO Contracts, and the ASO Contracts, and the Medicaid Plan Contract, and the Medicare Plan Contracts, including in each case any Renewal Contracts, each as set forth on Schedule 1 and as updated...

  • Page 518
    ... employees of the Company or its Affiliates. "Business" means the Company's business of offering, selling, administering or providing health care benefits under the Administered Contracts, including the Medicare Business and Medicaid Business, as conducted by the Company prior to the Effective Date...

  • Page 519
    ...-Effective Date Assessments, Premium Taxes and Commissions. "HIPAA" shall have that meaning set forth in Section 13.3(a). "HN Life" means Health Net Life Insurance Company, a California corporation. "Insurance/HMO Contracts" means collectively, all contracts of insurance or certificates of coverage...

  • Page 520
    ... their coverage under the Company's Medicaid Plan Contract. "Medicaid Plan Contract" means the Agreement to Provide HMO Services between Health Net of New Jersey, Inc. and the State of New Jersey, Department of Human Services, Division of Medical Assistance and Health Services (DMAHS), effective...

  • Page 521
    ...Services" shall have the meaning set forth in Section 9.1(d). "Person" shall mean any individual, corporation, partnership, limited partnership, joint venture, limited liability company, trust or unincorporated organization or Governmental Entity or any other entity. "Post-Effective Date Assessments...

  • Page 522
    ...reports, claims for refund, information returns and statements required to be filed with any Governmental Entity under applicable federal, state, local or any foreign Tax Law, and all returns, forms or other documents required to be retained by the Company in compliance with applicable Tax reporting...

  • Page 523
    ... provisions of this Administrative Services Agreement remain with the governing authority of Company.] 2 Section 2.2. Administrative Services. (a) The Administrator shall serve as the Company's finance, accounting, marketing, claims and administrative agent for the Administered Contracts, and as the...

  • Page 524
    ... Company, and in this connection directs the Administrator to wind down the business of the Company as soon as practicable consistent with applicable Law; (4) independent adoption and/or enforcement of policies affecting the operation of the Company and the delivery of health care services; provided...

  • Page 525
    ... of the Company) immediately prior to the Effective Date, taking into account the winding up and running out of the Business as contemplated under this Administrative Services Agreement. Without limiting the generality of the foregoing, the Administrator shall provide the Administrative Services in...

  • Page 526
    ... and the Company, as applicable, immediately prior to the Effective Date. If the Monthly Compliance Report establishes the Administrator's non-compliance with any Service Standard during the preceding month, then the Administrator shall promptly take steps, using commercially reasonable efforts...

  • Page 527
    ... payment, financial or other systems or databases holding information primarily related to the Business without the consent of United, in each case, subject to the Administrator's ability (a) to provide Claims administration services under a Claims Servicing Agreement following the Expiration Date...

  • Page 528
    ... identified on Schedule 3.4 which are related to the Business. The Administrator represents and warrants that Subcontractors providing Claims processing, data, network or other information technology services through procured or managed third party relationships have the requisite authority under...

  • Page 529
    ... other means of obtaining Administrative Services that the Administrator was to perform, or perform such services on its own behalf, without prior written approval from the New York State Department of Health.]7 Other than in the case of an inability to perform under Section 3.8, the Administrator...

  • Page 530
    .../Consultants, Contract Holders or Customers to cover losses and/or reinsurance or other recoverables; provided, that United will provide the Administrator retroactive membership information following the transfer of Company Employer Groups to Legacy United Entities' Plans to allow the Administrator...

  • Page 531
    ... the Administered Contracts and their authorized representatives (collectively, "Claimants"), with Claim forms or with access to Claim forms available for download or printing via the Company's website as allowed by applicable Law, and provide instructions on how to submit a Claim upon request by...

  • Page 532
    ..., that if the time frame for response makes the Company's prior review impractical, the Administrator shall promptly provide a copy of such response to the Company after submitting such response; (ii) promptly notify the Company of any written non-Claims payment related complaints or investigations...

  • Page 533
    ... by Government Entities related to a material issue, which consent the Company shall exercise in its sole discretion; and (iv) at the Company's request, provide to the Company a report in a form substantially similar to the type of reports used by the Company immediately prior to the Effective Date...

  • Page 534
    ... a party and, at the Company's request, provide to the Company a report summarizing the nature of such Legal Proceedings, and copies of any files or other documents that the Company may reasonably request in connection with its review of these matters. (b) The Company shall have the right to timely...

  • Page 535
    ... Administrative Services Agreement continues beyond the Expiration Date, Administrator shall make available to the Company all necessary Books and Records, documents, legal work product (created at the request of the Administrator on behalf of the Company), and provide reasonable access to personnel...

  • Page 536
    ... the Effective Date, subject to Section 2.3, the Administrator shall provide all Contract Holders and Customer services in connection with the Administered Contracts, including the following: (a) preparing and mailing all necessary, required or appropriate Contract Holder statements, reports and...

  • Page 537
    ... telephone call-center operations to accept and respond to inquiries, requests for information or complaints during normal business hours or as required by Law, by Customers, Contract Holders and Providers in connection with the Administered Contracts. As of the Effective Date, the Company has...

  • Page 538
    ... of Company and to those of other management contractors performing similar functions for the same or similar services. Administrator's utilization review processes must comply with article 49 of the N.Y. Public Health Law and must be approved by the Commissioner of the New York State Department of...

  • Page 539
    ...and Participating Provider relations with respect to the Business (but only with respect to contracts to which the Company is a party); provided, however, that the Administrator shall be responsible for contracting for and administering mental health and pharmaceutical Provider networks and benefits...

  • Page 540
    ... D plan members in New York sponsored by the Company prior to the Effective Date (the "NY Medicare PDP Members") and as otherwise required hereunder. Only to the extent that certain Joint Enterprise Agreement by and between HN Life, Health Net Insurance of Connecticut and Health Net Insurance of New...

  • Page 541
    ... Health Net Pharmaceutical Services ("HNPS") and Company (and CaremarkPCS Health, L.P. for the limited purpose of acting as a subcontractor of HNPS with respect to the provision of delegated management services for claims processing) (the "Vendor Agreements"). Company shall notify the New York State...

  • Page 542
    ...conducting monthly claims reserve valuation, and facilitating annual independent public accountant audits. With respect to each accounting or report required to be filed with a Governmental Entity by the Company, the Administrator shall provide a written certification to the Company in the same form...

  • Page 543
    ...will provide annual reports on its financial operations to Company and, upon request, any operational data requested by Company, the Commissioner of the New York State Department of Health, or the Superintendent of the New York State Department of Insurance.]12 Section 10.3. Monthly Reports. Subject...

  • Page 544
    ... Returns. The Company shall timely pay all Taxes due as reflected on such Premium Tax Returns and Post-Effective Date Assessments. Section 10.5. Customer Notifications. To the extent required by Law, the Administrator shall send to Contract Holders, Customers, Participating Providers and/or Brokers...

  • Page 545
    ... 3.2, relating to the Business (excluding contract information relating to out of state providers) and with reasonable access to relevant personnel for such period as this Administrative Services Agreement is in effect or for as long thereafter as any rights or obligations of either Party survives...

  • Page 546
    ..., information and documents as may be reasonably requested by a Party from time to time. If, at any time after the Effective Date, any further action is necessary or desirable to effectuate the purposes of this Administrative Services Agreement, each Party, as the case may be, shall execute and...

  • Page 547
    ... the Business Transition Agreement, any confidential information or trade secrets relating to the Business, the Administered Contracts or the business affairs of the Company or the Administrator. 13 This provision is found only in the Administrative Services Agreement of Health Net of New York, Inc...

  • Page 548
    ...such Governmental Entity; (d) at the proper request of the Company or at the request of a Customer, Contract Holder or its legal Representative as permitted by the Administered Contracts or applicable Law; provided, however, that such disclosure shall be limited only to the extent that is reasonably...

  • Page 549
    ... by the Company immediately prior to the Effective Date (taking into account the winding up and running out of the Business as contemplated under the Business Transition Agreement): (1) to insure the integrity, security and confidentiality of Nonpublic Personal Information and Customer records and...

  • Page 550
    ... check and electronic payments on existing Company disbursement Bank Accounts to pay Claims and Health Care Costs pursuant to this Administrative Services Agreement. The Administrator shall maintain such account(s) and pay all applicable bank fees and check stock costs; provided, that United shall...

  • Page 551
    ... of paying Claims or Health Care Costs. When and on terms reasonably requested by the Company, Administrator will work with the Company, United and Company banks to transition Bank Account signers, Bank Account bank analysis grouping, documentation and data transmission and reporting systems, and...

  • Page 552
    ... this Administrative Services Agreement and is unable to obtain an alternative means of providing the Administrative Services (except in the case of inability to perform under Section 3.8). 15 This provision is found only in the Administrative Services Agreement of Health Net of New York, Inc. 37

  • Page 553
    ... writing shall state the effective date of termination. (f) In the event that this Administrative Services Agreement is terminated under any of the provisions of Section 16.2(a) hereof, the Company shall either directly or through an Affiliate or an alternative third-party administrator perform the...

  • Page 554
    ... to the governing authority of Company and Administrator by the New York State Department of Health of a determination that Company is not providing adequate care or otherwise assuring the health, safety and welfare of its enrollees.] 16 Section 16.4. Effect of Termination. Notwithstanding...

  • Page 555
    ...-1611 Facsimile: (952) 992-5250 Attention: Chief Financial Officer & General Counsel and Oxford Health Plans, LLC One Penn Plaza New York, NY 10019 Facsimile: (203) 459-7171 Attention: Northeast Region Chief Executive Officer and: UnitedHealth Group Incorporated 9900 Bren Road East Minnetonka, MN...

  • Page 556
    (b) if to the Administrator, to: Health Net, Inc. 21650 Oxnard Street Woodland Hills, CA 91367 Facsimile: (818) 676-7503 Attention: Linda V. Tiano, Senior Vice President, General Counsel and Secretary with a copy to: Latham & Watkins LLP 355 South Grand Avenue Los Angeles, CA 90071-1560 Facsimile: ...

  • Page 557
    ...Services Agreement of Health Net of New York replaces the bracketed text with: "This Administrative Services Agreement, as approved by the New York State Department of Health, shall be the sole agreement between Administrator and Company for the purpose of the Management Functions herein and payment...

  • Page 558
    ... effective date. This Administrative Services Agreement shall be effective only with the prior written consent of the Commissioner of the New York State Department of Health. Any changes to this Administrative Services Agreement required by the Commissioner will be made by the Parties immediately...

  • Page 559
    ...this Administrative Services Agreement to be executed by their respective duly authorized officers, as of the Effective Date. PARENT: HEALTH NET, INC. By: Name: Title: ADMINISTRATOR: HEALTH NET OF THE NORTHEAST, INC. By: Name: Title: UHG: UNITEDHEALTH GROUP INCORPORATED By: Name: Title: COMPANY: By...

  • Page 560
    ... with all necessary member enrollment and eligibility information to perform its obligations under this Agreement. Notification by Benefits Payer of Modifications in Benefit Payer's Benefits Plan. From and after the Effective Date, the Company will promptly provide the Administrator with...

  • Page 561
    ... Management Provider Network Management Health Plan & Government Programs Regional Health Plan Programs Financial Planning & Analysis Actuary & Underwriting Corporate Finance Regulatory & External Relations Organization Effectiveness Legal Services & Settlements Customer Care Operations Information...

  • Page 562
    ...Groups sitused in the Applicable State which contract to provide health benefits on behalf of their eligible employees, members or beneficiaries who are enrolled pursuant to Health Plan Contracts, consistent with the Company's past practices, as of or following the Effective Date. "Enrollment Report...

  • Page 563
    ...Insurance Company of New York and United HealthCare Services, Inc. (each, a "Legacy United Entity"), which are licensed to offer, collectively, health insurance products in the Applicable State. "Legacy United Entities' Plans" shall mean the commercial group (large and small) health benefit products...

  • Page 564
    ... Groups of, or enrollment of Members or Employer Groups in, vision, dental, pharmacy, behavioral health or any other products other than the provision of coverage or services under Fully Insured Contracts and ASO Contracts. Section 1.2. Transition Efforts. (a) From and after the Effective Date...

  • Page 565
    ... State. (c) In accordance with the Transition Schedule, the Parties shall use commercially reasonable efforts to transfer each Employer Group's health care benefits provided by the Company and HN Life as a whole (e.g., with respect to a Employer Group that has health care benefit insurance products...

  • Page 566
    ... each such Accumulator Report, accumulator data, as prepared in accordance with the Company's past practices as of the Effective Date, for each Employer Group and Member, including such other information as specified in Schedule 1.4(a)(ii). Each Accumulator Report shall be provided in a consistent...

  • Page 567
    .... The Communication Plan shall also include (a) a schedule of mailing dates of letters of termination and introduction, which mailing dates shall comply with policy language and requirements of applicable Law, and (b) information that may be provided to Employer Groups, Members and Brokers...

  • Page 568
    ... not to enroll any Employer Group or Member upon expiration of the applicable Health Plan Contract. United and the Administrator agree to cooperate with each other with respect to the timing and content of such non-renewal and, if requested, cancellation notifications to the Membership in order...

  • Page 569
    ... compensation in effect from time to time or (B) make any non-monetary change to its employment practices. Except as provided in this Agreement, the Administrator, on behalf of the Company, shall not terminate existing contracts with self-funded Employer Groups, if any, following the Effective Date...

  • Page 570
    ...) • Health Net Life Reinsurance Company (Cayman Islands) (98-0409907) • Health Net Community Solutions, Inc. (CA) (54-2174068) • Health Net of California Real Estate Holdings, Inc. (CA) (54-2174069) Health Net of the Northeast, Inc. (DE) (06-1116976) • Health Net Insurance Services, Inc...

  • Page 571
    ...-2456130) Health Net One Payment Services, Inc. (DE) (54-2153100) • • Health Net Foundation, Inc. is a nonprofit, nonstock corporation exempt from federal income tax under section 501(c)(3) of the Internal Revenue Code. ** FH Surgery Centers, Inc. owns general and limited partnership units...

  • Page 572
    ..., 2010, relating to the financial statements and financial statement schedules of Health Net Inc., and the effectiveness of Health Net, Inc.'s internal control over financial reporting appearing in the Annual Report on Form 10-K of Health Net, Inc. for the year ended December 31, 2009. /s/ Deloitte...

  • Page 573
    ... Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 I, Jay M. Gellert, certify that: 1. 2. I have reviewed this annual report on Form 10-K of Health Net, Inc.; Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state...

  • Page 574
    ....2 Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 I, Joseph C. Capezza, certify that: 1. 2. I have reviewed this annual report on Form 10-K of Health Net, Inc.; Based on my knowledge, this report does not contain any untrue statement of a material...

  • Page 575
    ... Annual Report of Health Net, Inc. (the "Company") on Form 10-K for the year ending December 31, 2009 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Jay M. Gellert, as Chief Executive Officer of the Company, and Joseph C. Capezza, as Chief Financial Officer...