THIRD AMENDMENT TO TENET HEALTHCARE CORPORATION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
This Third Amendment to the Tenet Healthcare Corporation Supplemental
Executive Retirement Plan (the "Amendment") is made, entered into and effective
as of January 28, 1997.
RECITALS
A. Tenet Healthcare Corporation, a Nevada corporation formerly known as
National Medical Enterprises, Inc. ("Tenet") adopted the Supplemental Executive
Retirement Plan (the "Plan") on November 1, 1984, and amended the Plan on May
21, 1986, April 24, 1994, and July 25, 1994.
B. Section 5.4 of the Plan provides that Tenet reserves the right, in its
sole discretion, to amend the Plan.
C. Tenet desires to amend the Plan as more particularly described below.
NOW, THEREFORE, intending to be legally bound, Tenet hereby amends the Plan
as follows:
AMENDMENT
1. Section 2.10 of the Plan is hereby amended by deleting such Section in
its entirety and replacing it with the following:
"2.10 EARNINGS. "Earnings" means the base salary paid to a
Participant by Tenet or a Subsidiary, excluding bonuses, car
and other allowances and other cash and non-cash
compensation. However, for all Participants actively at
work on or after February 1, 1997 as full-time, regular
employees, "Earnings" means the base salary and annual cash
bonus paid to a Participant by Tenet or a Subsidiary
excluding car and other allowances and other cash and non-
cash compensation."
2. Section 2.14 is hereby amended by deleting such Section in its
entirety and replacing it with the following:
"2.14 EXISTING RETIREMENT BENEFIT PLANS ADJUSTMENT FACTOR.
"Existing Retirement Benefit Plans Adjustment Factor or
Factors" means the assumed benefit the Participant would be
eligible for under Social Security and all retirement plans
of Tenet and its Subsidiaries whether
or not he participates in such plans. This Factor will be used for
calculating all benefits under the Plan and is a projection of the
benefits payable under the Social Security regulations in effect June
1, 1984, and retirement plans of Tenet in effect on June 1, 1984, or
the participant's Date of Enrollment in the Plan, if later. Once
established for a Participant this Factor will not thereafter be
altered to reflect any reduction in benefits under Social Security.
This Factor will be adjusted to reflect changes in benefits under
Tenet retirement plans if a Participant is transferred to different
retirement plans or the Company contribution to a retirement plan is
increased or decreased from the percentage used for original
calculation of the Participant's Factor or the Participant becomes
eligible for other retirement plans adopted by the Company which would
provide benefits greater or less than the Plan considered in
calculating the Participant's original Factor, except that such Factor
for Participant's who are regular, full-time employees actively at
work with the Company on April 1, 1994, with the corporate office or a
division or Subsidiary that is not announced as a discontinued
operation shall be revised based upon the Participant's actual base
salary as of April 1, 1994, but no Factor will be increased as a
result of revision of the Factor to use the base salary as of April 1,
1994; provided, however, for a Participant who is a full-time, regular
employee actively at work on or after February 1, 1997, the Existing
Retirement Benefit Plans Adjustment Factor shall be applied only to
the base salary component of Final Average Earnings."
3. Section 2.15 of the Plan is hereby amended by deleting such Section in
its entirety and replacing it with the following:
"2.15 FINAL AVERAGE EARNINGS. "Final Average Earnings"
means the lesser of (i) Actual Final Average Earnings, or
(ii) if the Participant has completed at least sixty (60)
months of service, Projected Final Average Earnings;
however, for a Participant who is actively at work as a
full-time, regular employee on or after February 1, 1997
"Final Average Earnings" means Actual Final Average
Earnings."
4. Section 3.2(a)(iii) is hereby amended by deleting such Section in its
entirety and replacing it with the following:
"3.2(a)(iii) To arrive at the payments to commence at age
65 for a Participant whose termination occurs prior to
February 1, 1997 the amount calculated under paragraphs a(i)
and a(ii) of this Section 3.2 will be reduced by 0.42% for
each month Early Retirement commences before age 62. To
arrive at the payments to commence
at age 65 for a Participant who is actively at work as a
full-time, regular employee on or after February 1, 1997,
the amount calculated under paragraphs a(i) and a(ii) of
this Section 3.2 will be reduced by 0.25% for each month
Early Retirement commences before age 62."
5. Section 3.2(b) is hereby amended by deleting such Section in its
entirety and replacing it with the following:
"3.2(b) Upon the written request of a Participant prior to
termination of employment, the Committee, in its sole and
absolute discretion, may authorize payment of the Early
Retirement Benefit at a date prior to the Participant's
attainment of age 65; provided, however, that in such event
the amount calculated under paragraphs a(i) and a(iii) of
this Section 3.2 shall be further reduced by 0.42% for each
month that the date of the commencement of payment precedes
the date on which the Participant will attain age 62;
however, for a Participant who is actively at work as a
full-time, regular employee on or after February 1, 1997,
the amount of further reduction under paragraphs a(i) and
a(iii) of this Section 3.2 shall be 0.25% for each month
that the date of commencement of payment precedes the date
on which the Participant will attain age 62."
6. Section 3.4(c)(iii) is hereby amended by deleting such Section in its
entirety and replacing it with the following:
"3.4(c)(iii) If a Participant, who has a vested interest
under Section 3.3, dies while still actively employed by
Tenet or a Subsidiary or on Disability before he was
eligible for Early Retirement, his Surviving Spouse or
Eligible Children shall be entitled at the Participant's
death to receive 50% of the Retirement Benefit (in
accordance with Sections 3.5 and 3.6) calculated as if the
Participant was age 55 and eligible for Early Retirement on
the day before the Participant's death; provided, however,
that the combined reductions for Early Retirement and early
payment shall not exceed 21% of the amount calculated under
paragraphs a(i) and a(ii) of Section 3.2."
7. Section 3.4(d) is hereby amended by deleting such Section in its
entirety and replacing it with the following:
"3.4(d) To arrive at the payments to commence at age 65, the
amount calculated under paragraphs (a), (b), (c)(i) and
(c)(ii) of this Section 3.4 will be reduced by the maximum
percentage reduction for Early Retirement at age 55 (i.e.,
21%)."
8. Section 3.8(b) is hereby amended by deleting such Section in its
entirety and replacing it with the following:
"3.8(b) For a Participant who is a regular, full-time
employee actively at work on April 1, 1994, with the
corporate office or a division or a Subsidiary which has not
been declared to be a discontinued operation, who has not
yet begun to receive benefit payments under the Plan and
whose employment is Terminated without cause or who
voluntarily Terminates Employment following (a) a material
downward change in the functions, duties, or
responsibilities which reduce the rank or position of the
Participant, (b) (i) a reduction in the Participant's annual
base salary, or (ii) a material reduction in the
Participant's annual incentive plan bonus payment other than
for financial performance as it broadly applies to all
similarly situated active Participants in the same plan, or
(iii) a material reduction in the Participant's retirement
or supplemental retirement benefits that does not broadly
apply to all active Participant's in the same plan, or (c) a
transfer of a Participant's office to a location that is
more than fifty (50) miles from the Participant's current
principal office location, if such Termination of Employment
occurs within two years following a Change of Control of
Tenet while this Plan remains in effect, the provisions of
Section 3.8(a) above shall not apply and (i) a Participant's
Early or Normal Retirement Benefits under this Plan (a) will
be determined on the basis of (I) receiving full Prior
Service Credit under Sections 3.1 and 3.2 for all Years of
Service prior to his or her Date of Enrollment and (II)
being credited with three additional years to his or her
Years of Service (with total Years of Service not to exceed
20 years) and (b) will be fully vested in the Participant
without regard to his or her Years of Service with Tenet and
its Subsidiaries, (ii) will be determined by replacing the
definition of "Earnings" under Section 2.10 hereof with the
following "the base salary and the annual cash bonus paid to
a Participant by Tenet or a Subsidiary, excluding (A) any
cash bonus paid under the LTIP, (B) any car and other
allowances and (C) other cash and non-cash compensation",
and (iii) notwithstanding any other provision of this Plan
to the contrary, a Participant will be entitled to receive
the Normal Retirement Benefit on or after the age of 60,
without reduction, and after the age of 55 with a reduction
of 0.25% per month for each month for which the benefit
commences to be paid prior to the Participant's attaining
the age of 60 and after the age of 50 with the foregoing
reduction from age 60 to age 55 and with a reduction to
0.56% per month for each month for which the benefit
commences to be paid prior to the Participant's attaining
the age of 55. No other reductions set forth in Sections
3.2(a)(iii) and 3.2(b) will apply."
9. The Plan, as amended by this Amendment, remains in full force and
effect.
IN WITNESS WHEREOF, Tenet has signed this Amendment as of the date set
forth above.
Tenet Healthcare Corporation
By: /s/ Richard B. Silver
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Name: Richard B. Silver
Title: Assistant Secretary