Amendment No. 3 to Master Agreement



 Exhibit 10.4 
 “***” = CONFIDENTIAL PORTIONS OF THIS DOCUMENT HAVE BEEN OMITTED AND HAVE BEEN SEPARATELY 
 FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED 

Final Execution Version 
 AMENDMENT NO. 3 TO 
 MASTER AGREEMENT 

This Amendment Number 3 (“Amendment 3”), effective as of April 25, 2011 (the “Amendment
3 Effective Date”), is between Health Net, Inc. (“Health Net”), and International Business Machines Corporation (“Supplier”) (each, a
“Party” and collectively, the “Parties”). Defined terms used in this Amendment shall have the same meaning as in the Agreement unless otherwise specifically defined herein.
This Amendment 3 is made with reference to the following: 
 Background 

A. Master Agreement. The Parties entered into a Master Agreement dated August 19, 2008 (the “Agreement”), as
modified from time to time, pursuant to which Supplier provides certain business process outsourcing services to Health Net; and 
 B. Modification. The Parties now desire to modify the Agreement pursuant to this Amendment 3 with respect to the Service Levels, changing the definition of Amount-at-Risk and certain Service Level
metrics. 
 NOW, THEREFORE, in consideration of the mutual promises, covenants, agreements and other undertakings set forth
herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereby agree as follows: 
 Changes 
 1. Effective January 1, 2010, Section 2.1(a) of Schedule B (Service
Levels) is deleted in its entirety and replaced with the following: 
 “Amount at Risk” means an amount equal to ***
percent (***%) of the aggregate monthly charges payable by Health Net under this Agreement excluding: ***. 
  

	2.	For the period of January 1, 2010 through October 31, 2010, Exhibit B-1 is deleted in its entirety and replaced with the Exhibit B-1 attached hereto as
Attachment 1 to Amendment 3. 

  

	3.	Effective November 1, 2010, Exhibit B-1 is deleted in its entirety and replaced with the Exhibit B-1 attached hereto as Attachment 2 to Amendment 3.


  

	4.	Effective November 1, 2010, Section 1.3(a)(ii)(B) of Exhibit B-2 (Formula Definitions) is deleted in its entirety. 


 

	5.	Except as amended and modified by this Amendment, all of the terms and conditions of the Agreement shall remain in full force and effect. This Amendment may not be
modified except in writing signed by both Parties hereto. This Amendment, the Agreement and exhibits and schedules thereto constitute the entire agreement of the Parties with respect to the subject matter contained therein and supersede any and all
prior or contemporaneous agreements between the Parties, whether oral or written, concerning the subject matter contained herein. EACH PARTY ACKNOWLEDGES THAT IT HAS READ AND UNDERSTANDS THIS AMENDMENT AND AGREES TO BE BOUND BY THE TERMS
HEREOF. 

 IN WITNESS WHEREOF, the Parties hereto by their duly authorized representatives executed this
Amendment to be effective as of the Amendment Effective Date. 

  

			
	 Health Net/ IBM Confidential

Amendment 3 effect. 04252011
	  	  
 B-1 - 1










 Final Execution Version 

 

									
	 Health Net, Inc.
	 		 	International Business Machines Corporation
					
	By:	 	 /s/     David R.
Moffitt        
	 		 	By:	 	 /s/     Lisa Kogovsek
        

					
	Print Name:	 	David R. Moffitt	 		 	Print Name:	 	Lisa Kogovsek
					
	Title:	 	SR Sourcing Manager	 		 	Title:	 	IBM PE
					
	Date:	 	5/19/2011	 		 	Date:	 	6/8/2011


  

			
	 Health Net/ IBM Confidential

Amendment 3 effect. 04252011
	  	  
 B-1 - 2










 ATTACHMENT 1 TO AMENDMENT 3 

Exhibit B-1 

Service Levels 
 Effective January 1, 2010 through October 31, 2010 
 ***

  
  
  

 

  

			
	 Health Net/ IBM Confidential

Amendment 3 effect. 04252011
	  	









 ATTACHMENT 2 TO AMENDMENT 3 

Exhibit B-1 

Service Levels 
 Effective November 1, 2010 
 *** 

 

  

			
	  
 Exhibit B-1