Health Net (HNT) 8-K Entry into a Material Definitive Agreement

AMENDMENT TO BRIDGE LOAN AGREEMENT

THIS AMENDMENT TO BRIDGE LOAN AGREEMENT(this “Amendment”), dated as of September 21, 2006, is entered into amongHEALTH NET, INC., a Delaware corporation (the “Borrower”), the Lenders party thereto andTHE BANK OF NOVA SCOTIA, as administrative agent (the “Administrative Agent”).

W I T N E S S E T H

WHEREAS, the Borrower, the Lenders party thereto, and the Administrative Agent entered into that certain Bridge Loan Agreement dated as of June 23, 2006 (the “Existing Bridge Loan Agreement”);

WHEREAS,the Borrower has informed the Administrative Agent that it seeks to extend the Maturity Date for an additional six months;

WHEREAS, each Lender has agreed to such modification on the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the agreements hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

PART 1
DEFINITIONS

SUBPART 1.1Certain Definitions. Unless otherwise defined herein or the context otherwise requires, the following terms used in this Amendment, including its preamble and recitals, have the following meanings:

“Amendment Effective Date” is defined inSubpart 3.1.

SUBPART 1.2Other Definitions. Unless otherwise defined herein or the context otherwise requires, terms used in this Amendment, including its preamble and recitals, have the meanings provided in the Existing Bridge Loan Agreement.

PART 2
AMENDMENTS TO EXISTING BRIDGE LOAN AGREEMENT

Effective on (and subject to the occurrence of) the Amendment Effective Date, the Existing Bridge Loan Agreement is hereby amended in accordance with thisPart 2.

The following definition found in Section 1.01 of the Existing Bridge Loan Agreement is hereby amended and restated to read as follows:

“Maturity Date” means March 22, 2007.

PART 3
CONDITIONS TO EFFECTIVENESS

SUBPART 3.1Amendment Effective Date. This Amendment shall become effective as of the date hereof (the “Amendment Effective Date”) when all of the conditions set forth in thisPart 3 shall have been satisfied, and thereafter this Amendment shall be known, and may be referred to, as the “Amendment”.

SUBPART 3.2Execution of Counterparts of Amendment. The Administrative Agent shall have received counterparts of this Amendment, which collectively shall have been duly executed on behalf of each of the Borrower, the Lenders and the Administrative Agent.

PART 4
MISCELLANEOUS

SUBPART 4.1Representations and Warranties. The Borrower hereby represents and warrants to the Administrative Agent and the Lenders that, after giving effect to this Amendment, (a) no Default or Event of Default exists under the Existing Bridge Loan Agreement and (b) the representations and warranties set forth in Article V of the Existing Bridge Loan Agreement (i) that contain a materiality qualification are true and correct on and as of the date hereof, subject to the limitations set forth therein, as if made on and as of such date (except to the extent such representations and warranties expressly relate to another date in which case such representations and warranties shall be true and correct as of such date) and (ii) that do not contain a materiality qualification are true and correct in all material respects on and as of the date hereof, subject to the limitations set forth therein, as if made on and as of such date (except to the extent such representations and warranties expressly relate to another date in which case such representations and warranties shall be true and correct in all material respects as of such date).

SUBPART 4.2Cross-References. References in this Amendment to any Part or Subpart are, unless otherwise specified, to such Part or Subpart of this Amendment.

SUBPART 4.3Instrument Pursuant to Existing Bridge Loan Agreement. This Amendment is executed pursuant to the Existing Bridge Loan Agreement and shall (unless otherwise expressly indicated therein) be construed, administered and applied in accordance with the terms and provisions of the Existing Bridge Loan Agreement.

SUBPART 4.4References in Other Loan Documents. At such time as this Amendment shall become effective pursuant to the terms ofSubpart 3.1, all references to the “Bridge Loan Agreement” shall be deemed to refer to the Bridge Loan Agreement as amended by this Amendment.

SUBPART 4.5Counterparts/Telecopy. This Amendment may be executed by the parties hereto in several counterparts, each of which shall be deemed to be an original and all of which shall constitute together but one and the same agreement. Delivery of executed counterparts of the Amendment by telecopy shall be effective as an original and shall constitute a representation that an original shall be delivered.

SUBPART 4.6Governing Law. THIS AMENDMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, BUT EXCLUDING ALL OTHER CHOICE OF LAW AND CONFLICTS OF LAW RULES).

SUBPART 4.7Successors and Assigns. This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

SUBPART 4.8General. Except as amended hereby, the Existing Bridge Loan Agreement and all other loan documents shall continue in full force and effect.

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IN WITNESS WHEREOF, the parties hereto have executed this Amendment to the Bridge Loan Agreement as of the date first above written.

BORROWER:	HEALTH NET, INC.,
	a Delaware corporation
	By: Name: Title:	/s/ Wisdom Lu Wisdom Lu Treasurer

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ADMINISTRATIVE AGENT:	THE BANK OF NOVA SCOTIA
	By: Name: Title:	/s/ M.D. Smith M.D. Smith Agent Operations

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LENDER:	THE BANK OF NOVA SCOTIA
	By: Name: Title:	/s/ M.D. Smith M.D. Smith Agent Operations

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