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                                                                    Exhibit 10.1

                               PURCHASE AGREEMENT

                                  BY AND AMONG

                             MOLINA HEALTHCARE, INC.

                      ALLIANCE FOR COMMUNITY HEALTH, L.L.C.
                              D/B/A MERCY CAREPLUS

                         SISTERS OF MERCY HEALTH SYSTEM

                                CCP HOLDINGS, LLC

                                  JERRY LINDER

                               CRISTOPHER CRISTEA

                                       AND

                                  EDWARD OSWALD



                                TABLE OF CONTENTS



                                                                                              Page
                                                                                              ----
                                                                                           
DEFINITIONS .............................................................................      1

RECITALS ................................................................................      1

ARTICLE I PURCHASE AND SALE OF UNITS.....................................................      2

         1.1      Units..................................................................      2
         1.2      Actions Prior to Closing...............................................      2
         1.3      Base Purchase Price....................................................      2
         1.4      Closing................................................................      3
         1.5      Transfer of Units......................................................      3
         1.6      Deliveries by CH at Closing............................................      3
         1.7      Deliveries by the Executives at Closing................................      4
         1.8      Deliveries by SMHS at Closing..........................................      4
         1.9      Deliveries by Buyer at Closing.........................................      5
         1.10     Deliveries by the Company at Closing...................................      6
         1.11     Escrow Arrangements....................................................      7
ARTICLE II PURCHASE PRICE ADJUSTMENTS....................................................      7

         2.1      Purchase Price Adjustments.............................................      7
         2.2      RBC Adjustment.........................................................      7
         2.3      Contingent Earnings Payment............................................     10
         2.4      IBNR Adjustment........................................................     11
         2.5      Proxy for Adjustment Disputes..........................................     13
ARTICLE III REPRESENTATIONS AND WARRANTIES...............................................     14

         3.1      General Statement......................................................     14
         3.2      Representations and Warranties of Buyer................................     14
         3.3      Representations and Warranties of CH...................................     16
         3.4      Representations and Warranties of Sellers Regarding the Company........     18
         3.5      Representations and Warranties of the Executives.......................     36
         3.6      Representations and Warranties of SMHS.................................     37
         3.7      Survival of Representations and Warranties.............................     39
ARTICLE IV CONDUCT PRIOR TO EFFECTIVE TIME...............................................     39

         4.1      Obligations of the Company.............................................     39
         4.2      Standstill.............................................................     42
         4.3      Joint Obligations......................................................     43
         4.4      Obligations Relating to Executive Employment Agreements................     44
ARTICLE V CONDITIONS TO CLOSING..........................................................     45

         5.1      Conditions to Buyer's Obligations......................................     45
         5.2      Conditions to CH's Obligations.........................................     45





                                                                                           
         5.3      Conditions to the Company's Obligations................................     46
         5.4      Conditions to Each Executive's Obligations.............................     46
         5.5      Conditions to SMHS' Obligations........................................     47
ARTICLE VI POST-CLOSING COVENANTS........................................................     47

         6.1      Execution of Documents.................................................     47
         6.2      Covenant Not to Compete/Non-Solicitation...............................     47
         6.3      Confidentiality........................................................     49
         6.4      Books and Records......................................................     49
         6.5      Tax Matters............................................................     50
         6.6      Continuation of D&O Insurance..........................................     55
         6.7      Payment of Pre-Closing Medical Claims Post-Closing.....................     55
         6.8      Use of "Mercy CarePlus" Name...........................................     55
ARTICLE VII INDEMNIFICATION..............................................................     56

         7.1      Indemnification by Sellers.............................................     56
         7.2      Indemnification by Buyer...............................................     57
         7.3      Notice of Claim for Indemnification....................................     57
         7.4      Defense of Undisputed Claims...........................................     57
         7.5      Limitations............................................................     58
         7.6      Disputed Claims for Indemnification....................................     59
         7.7      Exclusive Remedy.......................................................     59
ARTICLE VIII EMPLOYMENT ARRANGEMENTS.....................................................     59

         8.1      Terminations of Employment.............................................     59
         8.2      New Executive Employment Arrangements..................................     60
ARTICLE IX TERMINATION .................................................. ...............     60

         9.1      Termination of Agreement...............................................     60
         9.2      Effect of Termination..................................................     61
ARTICLE X MISCELLANEOUS .................................................................     61

         10.1     Construction...........................................................     61
         10.2     Press Releases and Public Announcements................................     62
         10.3     Entire Agreement.......................................................     62
         10.4     No Third Party Beneficiaries...........................................     62
         10.5     Further Assurances.....................................................     62
         10.6     Successors and Assigns.................................................     62
         10.7     Assignment.............................................................     62
         10.8     Amendment..............................................................     62
         10.9     Notices................................................................     62
         10.10    Expenses and Attorneys' Fees...........................................     63
         10.11    Waivers................................................................     63
         10.12    Severability...........................................................     63
         10.13    Binding Arbitration....................................................     63
         10.14    Recitals...............................................................     66
         10.15    Exhibits and Disclosure Schedule.......................................     66
         10.16    Counterparts...........................................................     66


                                       ii




                               PURCHASE AGREEMENT

      THIS PURCHASE AGREEMENT ("Agreement") is entered into as of the 6th day of
September, 2007 ("Agreement Date"), by and among MOLINA HEALTHCARE, INC., a
Delaware corporation ("Buyer"), ALLIANCE FOR COMMUNITY HEALTH, L.L.C., a
Missouri limited liability company d/b/a Mercy CarePlus ("Company"), SISTERS OF
MERCY HEALTH SYSTEM, a Missouri nonprofit corporation ("SMHS"), CCP HOLDINGS,
LLC, a Missouri limited liability company ("CH"), JERRY LINDER, an individual
("Linder"), CRISTOPHER CRISTEA, an individual ("Cristea"), and EDWARD OSWALD, an
individual ("Oswald").

                                   DEFINITIONS

      Unless otherwise defined in the text of this Agreement, capitalized names
and terms in this Agreement (inclusive of the Exhibits and the Disclosure
Schedule) shall have the meanings ascribed to them in Exhibit A.

                                    RECITALS

      A. The Company holds a certificate of authority from the DOI to operate a
health maintenance organization and is authorized by the State Agency to arrange
for the provision of comprehensive health care services pursuant to the terms of
the Medicaid Contracts.

      B.Each Seller is a member of the Company and Sellers collectively own 100%
of the membership interests in the Company.

      C.CH owns 80.1 Class A Units issued by the Company, which represent 100%
of the Class A Units issued by the Company and 40.050% of the economic interests
of the Company.

      D.Linder owns 8.358 Class B Units issued by the Company, which represent
42% of the Class B Units issued by the Company and 4.179% of the economic
interests of the Company.

      E.Cristea owns 7.562 Class B Units issued by the Company, which represent
38% of the Class B Units issued by the Company and 3.781% of the economic
interests of the Company.

      F.Oswald owns 3.98 Class B Units issued by the Company, which represent
20% of the Class B Units issued by the Company and 1.990% of the economic
interests of the Company.

      G.SMHS owns 100 Class C Units issued by the Company, which represent 100%
of the Class C Units issued by the Company and 50.000% of the economic interests
of the Company.



      H.Sellers desire to sell all of their respective ownership interests in
the Company, including the Units, to Buyer and Buyer desires to purchase all
such ownership interests, in each instance pursuant to the provisions of this
Agreement.

      NOW, THEREFORE, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties and
covenants herein contained, the Parties agree as follows:

                                   ARTICLE I
                           PURCHASE AND SALE OF UNITS

      1.1 UNITS. On and subject to the provisions of this Agreement, Buyer shall
purchase from Sellers, and Sellers shall sell to Buyer, all of the Units free
and clear of any restrictions on transfer or Liens.

      1.2 ACTIONS PRIOR TO CLOSING.

            1.2.1 Buyer, in conjunction with obtaining approval by DOI of the
transactions contemplated by this Agreement, shall arrange to inject such
capital into Company at or in conjunction with the Closing to permit Company, on
terms and conditions acceptable to DOI, to (a) make the Pre-Closing Dividend set
forth at Section 1.2.3, and (b) engage in the Business following the Closing.

            1.2.2 Notwithstanding any other provision of this Agreement, Company
may declare and pay Pre-Closing Dividends to Sellers at such times and in such
amounts as the Company may determine; provided, however, (a) no such dividend
shall be paid without the approval of the DOI, and (b) the total amount of such
Pre-Closing Dividends shall not exceed the amount by which (i) the Company's
Capital and Surplus on the date of such Pre-Closing Dividend exceeds (ii) 300%
of the Company's RBC.

            1.2.3 Company, immediately prior to the Closing, shall wire transfer
to Sellers, in immediately available Federal funds to the respective bank
accounts designated by Sellers using the Standard Allocation, a Pre-Closing
Dividend in an amount equal to the amount by which (a) Capital and Surplus
exceeds (b) 300% of RBC as set forth on the Pro Forma RBC Calculation.

      1.3 BASE PURCHASE PRICE. The Base Purchase Price shall be paid to Sellers
at the Closing as follows:

            1.3.1 90% of the Base Purchase Price shall be wire transferred by
Buyer in immediately available Federal funds to the respective bank accounts
designated by Sellers prior to the Closing using the Standard Allocation; and

            1.3.2 10% of the Base Purchase Price shall be deposited by Buyer
into the Escrow Account.

                                        2


      1.4 CLOSING. The Closing shall take place at (a) the offices of Thompson
Coburn LLP, One US Bank Plaza, St. Louis, Missouri 63101, commencing at 9:00
a.m. local time on the Closing Date, or (b) such other place or time on the
Closing Date as Buyer and Sellers may mutually agree in writing.

      1.5 TRANSFER OF UNITS. At the Closing, (a) CH shall sell, transfer, assign
and convey all 80.1 Class A Units, including all membership interests related to
the Class A Units, to Buyer free and clear of any restrictions on transfer or
Liens, (b) each Executive shall sell, transfer, assign and convey all of his
respective Class B Units, including all membership interests related to the
Class B Units, to Buyer free and clear of any restrictions on transfer or Liens,
and (c) SMHS shall sell, transfer, assign and convey all 100 Class C Units,
including all membership interests related to the Class C Units, to Buyer free
and clear of any restrictions on transfer or Liens.

      1.6 DELIVERIES BY CH AT CLOSING. At the Closing, CH shall deliver to
Buyer:

            1.6.1 A copy of resolutions duly adopted by the Board of CH and
signed by the Secretary thereof (a) authorizing the execution, delivery and
performance by CH of this Agreement and all related agreements, documents and
instruments, (b) authorizing the sale of all 80.1 Class A Units to Buyer, (c)
consenting to the sale of the Class B Units by each Executive to Buyer, (d)
consenting to the sale of the Class C Units by SMHS to Buyer, (e) approving the
admission of Buyer as a member of the Company effective as of the Closing, (f)
acknowledging the voluntary withdrawal of each of SMHS and the Executives as a
member of the Company pursuant to the Operating Agreement effective as of the
Closing, and (g) withdrawing voluntarily as a member of the Company pursuant to
the Operating Agreement effective as of the Closing;

            1.6.2 A certificate of the Secretary of CH dated as of the Closing
Date certifying (a) the incumbency of the officers of CH on the Agreement Date
and as of the Closing and bearing the authentic signatures of all such officers
who shall execute this Agreement and any additional documents contemplated by
this Agreement, and (b) that the resolutions identified in Section 1.6.1 remain
in full force and effect through the Closing;

            1.6.3 A certificate of the Chairman of the Board of CH dated as of
the Closing Date certifying that (a) the representations of CH set forth in
Sections 3.3 and 3.4 are true and correct through the Closing, (b) CH has
performed and complied with its covenants in this Agreement through the Closing,
(c) all of the conditions precedent to the obligations of CH under Article V
have been satisfied or waived, and (d) CH is not subject to withholding under
FIRPTA;

            1.6.4 An original certificate of good standing of CH as a limited
liability company, issued by the Missouri Secretary of State and dated no
earlier than 30 days prior to the Closing Date;

            1.6.5 The written resignations, effective as of the Closing, of the
members of the Board of the Company appointed by CH;

                                       3


            1.6.6 A counterpart of the Escrow Agreement executed by CH and the
Escrow Agent; and

            1.6.7 Such other instruments, certificates and other documents as
are reasonably necessary for CH to implement, as of the Closing, the
transactions contemplated by this Agreement and to comply with the terms hereof.

      1.7 DELIVERIES BY THE EXECUTIVES AT CLOSING. At the Closing, each
Executive shall deliver to Buyer:

            1.7.1 An original certificate signed by such Executive and dated as
of the Closing Date (a) confirming the sale of all of his respective Class B
Units to Buyer, (b) consenting to the sale of the Class A Units by CH to Buyer,
(c) consenting to the sale of the respective Class B Units by the other
Executives to Buyer, (d) consenting to the sale of the Class C Units by SMHS to
Buyer, (e) consenting to the admission of Buyer as a member of the Company
effective as of the Closing, (f) acknowledging the voluntary withdrawal of each
of CH, SMHS and the other Executives as members of the Company pursuant to the
Operating Agreement effective as of the Closing, (g) withdrawing voluntarily as
a member of the Company pursuant to the Operating Agreement effective as of the
Closing, (h) stating that the representations of such Executive set forth in
Sections 3.4 and 3.5 are true and correct through the Closing, (i) resigning,
effective as of the Closing, from any and all offices in the Company held by
such Executive, (j) resigning, effective as of the Closing, as a member of the
Board of the Company, if applicable, (k) confirming that such Executive has
performed and complied with his covenants in this Agreement through the Closing,
(l) stating that all of the conditions precedent to the obligations of such
Executive under Article V have been satisfied or waived, and (m) confirming that
all of the obligations related to such Executive's Executive Employment
Agreement set forth in Section 4.4 have been satisfied;

            1.7.2 An indication by the Executive that mutually acceptable New
Executive Employment Arrangements have either been reached or not been reached
between the Company and such Executive;

            1.7.3 A counterpart of the Escrow Agreement executed by such
Executive; and

            1.7.4 Such other instruments, certificates and other documents as
are reasonably necessary for such Executive to implement, as of the Closing, the
transactions contemplated by this Agreement and to comply with the terms hereof.

      1.8 DELIVERIES BY SMHS AT CLOSING. At the Closing, SMHS shall deliver to
Buyer:

            1.8.1 A copy of resolutions duly adopted by the Board of SMHS and
signed by the Secretary thereof (a) authorizing the execution, delivery and
performance by SMHS of this Agreement and all related agreements, documents and
instruments, (b) authorizing the sale of all 100 Class C Units to Buyer, (c)
consenting to the sale of the Class B Units by each Executive to Buyer, (d)
consenting to the sale of the Class A Units by CH to Buyer, (e) approving the
admission of Buyer as a member of the Company effective as of the Closing, (f)
acknowledging

                                       4


the voluntary withdrawal of each of CH and the Executives as a member of the
Company pursuant to the Operating Agreement effective as of the Closing, and (g)
withdrawing voluntarily as a member of the Company pursuant to the Operating
Agreement effective as of the Closing;

            1.8.2 A certificate of the Secretary of SMHS dated as of the Closing
Date certifying (a) the incumbency of the officers of SMHS on the Agreement Date
and as of the Closing and bearing the authentic signatures of all such officers
who shall execute this Agreement and any additional documents contemplated by
this Agreement, and (b) that the resolutions identified in Section 1.8.1 remain
in full force and effect through the Closing;

            1.8.3 A certificate of the Chairman or President of SMHS dated as of
the Closing Date certifying that (a) the representations of SMHS set forth in
Sections 3.4 and 3.6 are true and correct through the Closing, (b) SMHS has
performed and complied with its covenants in this Agreement through the Closing,
(c) all of the conditions precedent to the obligations of SMHS under Article V
have been satisfied or waived, and (d) SMHS is not subject to withholding under
FIRPTA;

            1.8.4 An original certificate of corporate good standing of SMHS,
issued by the Missouri Secretary of State and dated no earlier than 30 days
prior to the Closing Date;

            1.8.5 The written resignations, effective as of the Closing, of the
members of the Board of the Company appointed by SMHS;

            1.8.6 A counterpart of the Escrow Agreement executed by SMHS;

            1.8.7 A counterpart of the License Agreement executed by SMHS; and

            1.8.8 Such other instruments, certificates and other documents as
are reasonably necessary for SMHS to implement, as of the Closing, the
transactions contemplated by this Agreement and to comply with the terms hereof.

      1.9 DELIVERIES BY BUYER AT CLOSING. At the Closing, Buyer shall deliver to
Sellers:

            1.9.1 90% of the Base Purchase Price (as set forth in Section
1.3.1);

            1.9.2 A copy of resolutions duly adopted by the Board of Buyer and
signed by the Secretary thereof authorizing the execution, delivery and
performance by Buyer of this Agreement and all related agreements, documents and
instruments;

            1.9.3 A certificate of the Secretary of Buyer dated as of the
Closing Date certifying (a) the incumbency of the officers of Buyer on the
Agreement Date and as of the Closing and bearing the authentic signatures of all
such officers who shall execute this Agreement and any additional documents
contemplated by this Agreement, and (b) that the resolutions identified in
Section 1.9.2 remain in full force and effect through the Closing;

                                       5


            1.9.4 A certificate of the Chairman of the Board of Buyer dated as
of the Closing Date certifying that (a) the representations of Buyer set forth
in Sections 3.2 are true and correct as of the Closing Date, (b) Buyer has
performed and complied with its covenants in this Agreement through the Closing,
and (c) all of the conditions precedent to the obligations of Buyer under
Article V have been satisfied or waived;

            1.9.5 An original certificate of corporate good standing of Buyer,
issued by the Delaware Secretary of State and dated no earlier than 30 days
prior to the Closing Date;

            1.9.6 A counterpart of the Escrow Agreement executed by Buyer;

            1.9.7 A written joinder to the Operating Agreement executed by Buyer
as a new member of the Company whereby Buyer agrees to be bound by the terms of
the Operating Agreement;

            1.9.8 An indication by Buyer regarding whether mutually acceptable
New Executive Employment Arrangements have been reached between the Company and
each of the Executives;

            1.9.9 Such other instruments, certificates and other documents as
are reasonably necessary for Buyer to implement, as of the Closing, the
transactions contemplated by this Agreement and to comply with the terms hereof.

      1.10 DELIVERIES BY THE COMPANY AT CLOSING. At the Closing, the Company
shall, and Sellers shall cause the Company to, deliver to Buyer:

            1.10.1 A copy of resolutions duly adopted by the Board of the
Company and signed by the Secretary thereof (a) authorizing the execution,
delivery and performance by the Company of this Agreement and all related
agreements, documents and instruments, (b) approving the sale of the Class A
Units by CH to Buyer, (c) approving the sale of the Class B Units by the
Executives to Buyer, (d) approving the sale of the Class C Units by SMHS to
Buyer, (e) authorizing the admission of Buyer as a member of the Company
effective as of the Closing, and (f) acknowledging the voluntary withdrawal of
CH, the Executives and SMHS as members of the Company pursuant to the Operating
Agreement effective as of the Closing.

            1.10.2 A certificate of the Secretary of the Company dated as of the
Closing Date certifying (a) the incumbency of the officers of the Company on the
Agreement Date and as of the Closing and bearing the authentic signatures of all
such officers who shall execute this Agreement and any additional documents
contemplated by this Agreement, and (b) that the resolutions identified in
Section 1.10.1 remain in full force and effect through the Closing;

            1.10.3 A certificate of the Chairman of the Board of the Company
dated as of the Closing Date certifying that (a) the Company has performed and
complied with its covenants in this Agreement through the Closing, (b) all of
the conditions precedent to the obligations of the Company under Article V have
been satisfied or waived, and (c) all of the obligations related to the
Executive Employment Agreements of the Executives set forth in Section 4.4 have
been satisfied;

                                        6



            1.10.4 An original certificate of good standing of the Company as a
limited liability company, issued by the Missouri Secretary of State and dated
no earlier than 30 days prior to the Closing Date;

            1.10.5 The document required under Section 5.4.6;

            1.10.6 An indication by the Company regarding whether mutually
acceptable New Executive Employment Arrangements have been reached between the
Company and each of the Executives;

            1.10.7 A counterpart of the License Agreement executed by the
Company;

            1.10.8 A copy of the Monthly Remittance Advice for the month ending
immediately preceding the Closing Date;

            1.10.9 The written resignations, effective as of the Closing, of
each officer of the Company, other than any Executives who have reached
agreement on a New Executive Employment Arrangement in accordance with Section
8.2, from any office(s) in the Company which such officer holds;

            1.10.10 A copy of the fully executed St. John's Mercy Provider
Agreement; and

            1.10.11 Such other instruments, certificates and other documents as
are reasonably necessary for the Company to implement, as of the Closing, the
transactions contemplated by this Agreement and to comply with the terms hereof.

      1.11 ESCROW ARRANGEMENTS. At the Closing, Buyer and Sellers shall execute
the Escrow Agreement pursuant to which the Escrow Agent shall receive 10% of the
Base Purchase Price to be held in escrow and distributed and released by the
Escrow Agent in accordance with the terms of the Escrow Agreement.

                                   ARTICLE II
                           PURCHASE PRICE ADJUSTMENTS

      2.1 PURCHASE PRICE ADJUSTMENTS. Following the Closing, the Base Purchase
Price shall be subject to the adjustments set forth in this Article II.

      2.2 RBC ADJUSTMENT.

            2.2.1 No less than five Business Days prior to the Closing Date, the
Company shall prepare in good faith and deliver to Buyer and Sellers the Pro
Forma RBC Calculation.

            2.2.2 Within 120 days following the Closing Date, the Company shall
prepare and deliver to Sellers the Proposed Final RBC Calculation reflecting
with particularity any differences between the Pro Forma RBC Calculation and the
Proposed Final RBC Calculation and attaching supporting documentation for such
differences.

                                       7


            2.2.3 Within 30 days following receipt of the Proposed Final RBC
Calculation, Sellers may request, and the Company shall be obligated to produce
and deliver to Sellers within ten Business Days of such request, any and all
financial information, working papers, books, records and other materials
reasonably deemed necessary by Sellers to identify the differences between the
Pro Forma RBC Calculation and the Proposed Final RBC Calculation.
Notwithstanding any other provision of this Agreement to the contrary, a dispute
arising in connection with the Company's obligation to produce and deliver
materials to Sellers under this Section 2.2.3 shall be arbitrated pursuant to
Section 10.13.

            2.2.4 Within 30 days after receipt of the documents requested
pursuant to Section 2.2.3 or such documents as are ultimately ordered to be
produced pursuant to Section 10.13, Sellers may dispute all or any portion of
the Proposed Final RBC Calculation by giving written notice (an "RBC Notice of
Disagreement") to Buyer setting forth in reasonable detail the basis for any
such dispute (an "RBC Disagreement").

            2.2.5 In the event Sellers do not provide an RBC Notice of
Disagreement to Buyer within the 30-day period referenced in Section 2.2.4,
Sellers shall be deemed to have accepted the Proposed Final RBC Calculation in
the form delivered to Sellers by the Company, in which event the Proposed Final
RBC Calculation shall be deemed to be the Final RBC Calculation for purposes of
calculating the RBC Adjustment.

            2.2.6 In the event Sellers provide a timely RBC Notice of
Disagreement to Buyer, Buyer and Sellers shall promptly commence good faith
negotiations with a view to resolving any RBC Disagreement. If Buyer and Sellers
resolve amicably the RBC Disagreement, Buyer and Sellers shall enter into a
written agreement reflecting such resolution and such resolution shall be
applied to the Proposed Final RBC Calculation, in which event the Proposed Final
RBC Calculation as finally resolved by Buyer and Sellers shall be deemed to be
the Final RBC Calculation. If Buyer and Sellers do not resolve any RBC
Disagreement, within 30 days of the delivery by Sellers to Buyer of an RBC
Notice of Disagreement, such RBC Disagreement(s) shall be referred to an
independent certified public accountant mutually selected by Buyer and Sellers
for resolution of such RBC Disagreement(s) in accordance with the terms of this
Agreement.

            2.2.7 In the event Buyer and Sellers are unable to agree upon an
independent certified public accountant within ten days following the end of the
30-day period referenced in Section 2.2.6, an independent certified public
accountant shall be determined as follows: (a) Sellers shall designate an
independent certified public accountant; (b) Buyer shall designate an
independent certified public accountant; and (c) the respective accountants
designated by Buyer and Sellers shall select an independent certified public
accountant to serve as the Independent Accountant within ten days following the
date on which the last of them is designated; provided, however, if the
respective accountants designated by Buyer and Sellers are unable to agree
timely upon the selection of the Independent Accountant, the Independent
Accountant shall be selected by the American Arbitration Association from among
its panel of certified public accountants who are independent of Buyer and
Sellers and members of a national or regional accounting firm which is also
independent of Buyer and Sellers.

                                       8


            2.2.8 Buyer and Sellers shall (a) use their respective commercially
reasonable efforts to cause the Independent Accountant to render a timely
determination within the period described in Section 2.2.9, (b) cooperate with
the Independent Accountant, (c) provide the Independent Accountant with access
to such books, records, personnel and other information as the Independent
Accountant may deem necessary to render a decision, and (d) equally share (50%
to Buyer and 50% to Sellers) all fees and expenses of the Independent
Accountant.

            2.2.9 The determination of the RBC Adjustment by the Independent
Accountant shall be (a) prepared in accordance with SAP as finally decided by
the Independent Accountant, (b) consistent with the definition of "Proposed
Final RBC Calculation," (c) rendered in writing and delivered to Buyer and
Sellers within 30 days after referral of the RBC Disagreement to the Independent
Accountant or as soon thereafter as reasonably practicable as determined by the
Independent Accountant, (d) final and binding upon the Parties, and (e)
enforceable in any court of competent jurisdiction in the United States.

            2.2.10 The adjustments to the Proposed Final RBC Calculation
reflected on the Final RBC Calculation as resolved amicably by Buyer and Sellers
pursuant to Section 2.2.6 or as determined by the Independent Accountant shall
be used to calculate the RBC Adjustment and the Parties agree that the
procedures set forth in this Section 2.2 shall be the sole and exclusive remedy
with respect to the determination of the RBC Adjustment.

            2.2.11 If, pursuant to the Final RBC Calculation, the amount by
which Capital and Surplus exceeds 200% of RBC is greater than the amount of the
Pre-Closing Dividend paid by Company to Sellers under Section 1.2.3, Company or
Buyer shall pay to Sellers (using the Standard Allocation) the amount of such
excess in accordance with Sections 2.2.13 and 2.2.14 by wiring such amount in
immediately available Federal funds to the respective bank accounts designated
by Sellers.

            2.2.12 If, pursuant to the Final RBC Calculation, the amount by
which Capital and Surplus exceeds 200% of RBC is less than the amount of the
Pre-Closing Dividend paid by Company to Sellers under Section 1.2.3, Sellers
(using the Standard Allocation) shall pay to Company the amount of such
deficiency in accordance with Sections 2.2.13 and 2.2.14 by wiring such amount
in immediately available Federal funds to the bank account designated by
Company.

            2.2.13 Any payment due under Section 2.2.11 or Section 2.2.12,
including interest thereon calculated pursuant to Section 2.2.14, shall be due
and payable within five Business Days following a determination of the RBC
Adjustment.

            2.2.14 Any payment due under Section 2.2.11 or Section 2.2.12 shall
bear interest at a rate equal to the average monthly rate of interest earned on
the funds deposited with the Escrow Agent in accordance with the terms of the
Escrow Agreement immediately prior to the due date for such payment.

                                       9


      2.3 CONTINGENT EARNINGS PAYMENT.

            2.3.1 On December 15, 2008, the Company shall prepare and deliver to
Sellers a written report (the "Earnings Report") identifying Earnings during the
Earnings Period, together with the audit reports of the auditing firm then
providing auditing services to the Company and attaching supporting
documentation for the reported Earnings.

            2.3.2 If the Earnings Report reports Earnings during the Earnings
Period of less than $22,000,000, Sellers, within 30 days following receipt of
the Earnings Report, may request, and the Company shall be obligated to produce
and deliver to Sellers within ten Business Days of such request, any and all
financial information, working papers, books, records and other materials
reasonably deemed necessary by Sellers to challenge the reported Earnings,
including any IBNR reflected on the Earnings Report. Notwithstanding any other
provision of this Agreement to the contrary, a dispute arising in connection
with the Company's obligation to produce and deliver materials to Sellers under
this Section 2.3.2 shall be arbitrated pursuant to Section 10.13.

            2.3.3 Within 15 Business Days after receipt of the documents
requested pursuant to Section 2.3.2 or such documents as are ultimately ordered
to be produced pursuant to Section 10.13, Sellers may dispute all or any portion
of the Earnings Report by giving written notice (an "Earnings Notice of
Disagreement") to Buyer setting forth in reasonable detail the basis for any
such dispute (an "Earnings Disagreement").

            2.3.4 In the event Sellers do not provide an Earnings Notice of
Disagreement to Buyer within the 15-day period referenced in Section 2.3.3,
Sellers shall be deemed to have accepted the conclusions set forth in the
Earnings Report.

            2.3.5 In the event Sellers provide a timely Earnings Notice of
Disagreement to Buyer, Buyer and Sellers shall promptly commence good faith
negotiations with a view to resolving any Earnings Disagreement. If Buyer and
Sellers resolve amicably the Earnings Disagreement, Buyer and Sellers shall
enter into a written agreement reflecting such resolution and such resolution
shall be applied to the Earnings Report. If Buyer and Sellers do not resolve any
Earnings Disagreement, within 30 days of the delivery by Sellers to Buyer of an
Earnings Notice of Disagreement, such Earnings Disagreement shall be referred to
an independent certified public accountant mutually selected by Buyer and
Sellers for resolution of such Earnings Disagreement(s) in accordance with the
terms of this Agreement.

            2.3.6 In the event Buyer and Sellers are unable to agree upon an
independent certified public accountant within ten days following the end of the
30-day period referenced in Section 2.3.5, an independent certified public
accountant shall be determined as follows: (a) Sellers shall designate an
independent certified public accountant; (b) Buyer shall designate an
independent certified public accountant; and (c) the respective accountants
designated by Buyer and Sellers shall select an independent certified public
accountant to serve as the Independent Accountant within ten days following the
date on which the last of them is designated; provided, however, if the
respective accountants designated by Buyer and Sellers are unable to agree
timely upon the selection of the Independent Accountant, the Independent
Accountant shall be

                                       10


selected by the American Arbitration Association from among its panel of
certified public accountants who are independent of Buyer and Sellers and
members of a national or regional accounting firm which is also independent of
Buyer and Sellers.

            2.3.7 Buyer and Sellers shall (a) use their respective commercially
reasonable efforts to cause the Independent Accountant to render a timely
determination within the period described in Section 2.3.8, (b) cooperate with
the Independent Accountant, (c) provide the Independent Accountant with access
to such books, records, personnel and other information as the Independent
Accountant may deem necessary to render a decision, and (d) equally share (50%
to Buyer and 50% to Sellers) all fees and expenses of the Independent
Accountant.

            2.3.8 The determination of Earnings by the Independent Accountant
shall be prepared in accordance with GAAP as finally decided by the Independent
Accountant, and the determination of the amount of Earnings during the Earnings
Period by the Independent Accountant shall be (a) rendered in writing and
delivered to Buyer and Sellers within 30 days after referral of the Earnings
Disagreement to the Independent Accountant or as soon thereafter as reasonably
practicable as determined by the Independent Accountant, (b) consistent with the
definition of "Earnings," (c) final and binding upon the Parties, and (d)
enforceable in any court of competent jurisdiction in the United States.

            2.3.9 The adjustments to the Earnings Report as resolved amicably by
Buyer and Sellers pursuant to Section 2.3.5 or as determined by the Independent
Accountant shall govern Buyer's liability to pay the Earnings Payment and the
Parties agree that the procedures set forth in this Section 2.3 shall be the
sole and exclusive remedy with respect to the determination of Earnings during
the Earnings Period.

            2.3.10 If the Earnings during the Earnings Period as finally
determined by agreement of the Parties or by the Independent Accountant are (a)
$22,000,000 or more, Buyer shall pay to Sellers (using the Standard Allocation)
the amount of $5,000,000 in accordance with Section 2.3.11 by wiring such amount
in immediately available Federal funds to the respective bank accounts
designated by Sellers, and (b) less than $22,000,000, Buyer shall not be
obligated to make any contingency payment to Sellers under this Section 2.3.

            2.3.11 Any payment due under Section 2.3.10 shall be due and payable
within five Business Days following a final determination of Earnings.

      2.4 IBNR ADJUSTMENT.

            2.4.1 On December 15, 2008, the Company shall prepare and deliver to
Sellers a written report (the "IBNR Report") comparing (a) IBNR on the balance
sheet produced in conjunction with the Final RBC Calculation, and (b) Medical
Payments (for Medical Claims incurred prior to the Effective Time) commencing on
the day following the Closing Date and ending on the IBNR Calculation Date.

            2.4.2 The IBNR Report shall (a) be based upon the operating and
financial information reported by the Company on its books and records as of the
IBNR Calculation Date,

                                       11


(b) attach supporting documentation for the conclusions in the IBNR Report, (c)
not consider any regulatory penalties incurred by the Company following the
Closing Date, and (d) not consider any remaining IBNR in making the calculations
reflected in the IBNR Report.

            2.4.3 Within 30 days following receipt of the IBNR Report, Sellers
may request, and the Company shall be obligated to produce and deliver to
Sellers within ten Business Days of such request, any and all financial
information, working papers, books, records and other materials deemed necessary
by Sellers to (a) identify the differences between (i) IBNR on the balance sheet
produced in conjunction with the Final RBC Calculation, and (ii) Medical
Payments (for Medical Claims incurred prior to the Effective Time) commencing on
the day following the Closing Date and ending on the IBNR Calculation Date, and
(b) document compliance with Section 6.7. Notwithstanding any other provision of
this Agreement to the contrary, a dispute arising under this Section 2.4.3 shall
be arbitrated pursuant to Section 10.13.

            2.4.4 Within 30 days after receipt of the documents requested
pursuant to Section 2.4.3 or such documents as are ultimately ordered to be
produced pursuant to Section 10.13, Sellers may dispute all or any portion of
the IBNR Report by giving written notice (an "IBNR Notice of Disagreement") to
Buyer setting forth in reasonable detail the basis for any such dispute (an
"IBNR Disagreement").

            2.4.5 In the event Sellers do not provide an IBNR Notice of
Disagreement to Buyer within the 30-day period referenced in Section 2.4.4,
Sellers shall be deemed to have accepted the IBNR Report in the form delivered
to Sellers by the Company in which event the Proposed IBNR Adjustment shall be
deemed to be the Final IBNR Adjustment.

            2.4.6 In the event Sellers provide a timely IBNR Notice of
Disagreement to Buyer, Buyer and Sellers shall promptly commence good faith
negotiations with a view to resolving any IBNR Disagreement. If Buyer and
Sellers resolve amicably the IBNR Disagreement, Buyer and Sellers shall enter
into a written agreement reflecting such resolution and such resolution shall be
applied to the IBNR Report, in which event the IBNR Report as finally resolved
by Buyer and Sellers shall be deemed to be the Final IBNR Adjustment. If Buyer
and Sellers do not resolve any IBNR Disagreement, as evidenced by a written
agreement between them, within 30 days of the delivery by Sellers to Buyer of an
IBNR Notice of Disagreement, such IBNR Disagreement(s) shall be referred to an
independent certified public accountant mutually selected by Buyer and Sellers
for resolution of such IBNR Disagreement(s) in accordance with the terms of this
Agreement.

            2.4.7 In the event Buyer and Sellers are unable to agree upon an
independent certified public accountant within ten days following the end of the
30-day period referenced in Section 2.4.6, an independent certified public
accountant shall be determined as follows: (a) Sellers shall designate an
independent certified public accountant; (b) Buyer shall designate an
independent certified public accountant; and (c) the respective accountants
designated by Buyer and Sellers shall select an independent certified public
accountant to serve as the Independent Accountant within ten days following the
date on which the last of them is designated; provided, however, if the
respective accountants designated by Buyer and Sellers are unable to agree
timely upon the selection of the Independent Accountant, the Independent
Accountant shall be

                                       12


selected by the American Arbitration Association from among its panel of
certified public accountants who are independent of Buyer and Sellers and
members of a national or regional accounting firm which is also independent of
Buyer and Sellers.

            2.4.8 Buyer and Sellers shall (a) use their respective commercially
reasonable efforts to cause the Independent Accountant to render a timely
determination within the period referenced in Section 2.4.9, (b) cooperate with
the Independent Accountant, (c) provide the Independent Accountant with access
to such books, records, personnel and other information as the Independent
Accountant may deem necessary to render a determination, and (d) equally share
(50% to Buyer and 50% to Sellers) all fees and expenses of the Independent
Accountant.

            2.4.9 The determination of the Final IBNR Adjustment by the
Independent Accountant shall be (a) rendered in writing and delivered to Buyer
and Sellers within 30 days after referral of the IBNR Disagreement to the
Independent Accountant or as soon thereafter as reasonably practicable, (b)
consistent with the definition of "Final IBNR Adjustment," (c) final and binding
upon the Parties, and (d) enforceable in any court of competent jurisdiction in
the United States.

            2.4.10 The procedures set forth in this Section 2.4 shall be the
sole and exclusive remedy with respect to the determination of the Final IBNR
Adjustment.

            2.4.11 If there is no Final IBNR Adjustment, neither Buyer nor
Sellers shall receive any adjustment to the Base Purchase Price related to IBNR.

            2.4.12 If, pursuant to the Final IBNR Adjustment, the IBNR on the
Final RBC Calculation exceeds the Medical Payments (for Medical Claims incurred
prior to the Effective Time) commencing on the day following the Closing Date
and ending on the last date upon which such Medical Payments are calculated
pursuant to this Section 2.4, Buyer shall pay to Sellers (using the Standard
Allocation) 64.00% of the amount of such difference in accordance with Section
2.4.14 by wiring such amount in immediately available Federal funds to the
respective bank accounts designated by Sellers.

            2.4.13 If, pursuant to the Final IBNR Adjustment, the IBNR on the
Final RBC Calculation is less than the Medical Payments (for Medical Claims
incurred prior to the Effective Time) commencing on the day following the
Closing Date and ending on the last date upon which such Medical Payments are
calculated pursuant to this Section 2.4, Sellers (using the Standard Allocation)
shall pay to the Company an amount equal to 64.00% of the amount of such
difference in accordance with Section 2.4.14 by wiring such amount in
immediately available Federal funds to the respective bank account designated by
the Company.

            2.4.14 Any payment due under Section 2.4.12 or Section 2.4.13 shall
be due and payable within five Business Days following determination of the
Final IBNR Adjustment.

      2.5 PROXY FOR ADJUSTMENT DISPUTES. To facilitate the administration of the
procedures set forth in Sections 2.2 through and including Section 2.5, Linder,
Cristea and Oswald hereby grant an irrevocable proxy to CH to represent their
respective interests for all

                                       13


purposes in exercising their respective rights as Sellers under such procedures;
provided, however, Linder, Cristea and Oswald shall be kept apprised of all
proceedings under such Sections and shall be entitled to receive copies of all
pertinent reports upon request.

                                  ARTICLE III
                         REPRESENTATIONS AND WARRANTIES

      3.1 GENERAL STATEMENT. Subject to Section 3.7, all representations and
warranties set forth in this Article III and in any Financial Statement, any
Exhibit, the Disclosure Schedule, any certificate or any other document attached
hereto or delivered by a Party in connection herewith shall survive the
consummation of the transactions contemplated by this Agreement. No specific
representation or warranty shall limit the generality or applicability of a more
general representation or warranty. The representations and warranties of
Sellers in Section 3.4 shall be subject to the exceptions noted in this
Agreement, including those identified in the Disclosure Schedule.

      3.2 REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer hereby represents to
Sellers that the following facts and circumstances are true and correct and
Buyer acknowledges that such facts and circumstances constitute a material
inducement for the execution of this Agreement by Sellers:

            3.2.1 Organization and Good Standing. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware.

            3.2.2 Authority and Enforceability. Buyer has full power and
authority, including full corporate power and authority, to execute, deliver and
perform its respective obligations under this Agreement. The execution, delivery
and performance of this Agreement and all other agreements contemplated by this
Agreement have been duly authorized by Buyer. Assuming the due authorization,
execution and delivery by each other Party, this Agreement constitutes a valid
and legally binding obligation of Buyer, enforceable in accordance with its
respective terms and conditions.

            3.2.3 Consents. Buyer is not required to give any notice to, make
any filing with or obtain any authorization, consent or approval of any
Governmental Entity in order to consummate the transactions contemplated by this
Agreement other than as may be required of Buyer (a) under the HSR Act, and (b)
to obtain any required approval or consent from, or make any disclosure to, DOI
or the State Agency.

            3.2.4 Non-Contravention. Neither the execution and the delivery of
this Agreement nor the consummation of the transactions contemplated by this
Agreement will (a) violate any constitution, statute, regulation, rule, License,
injunction, judgment, order, decree, ruling, charge or other restriction of any
Governmental Entity to which Buyer is subject or any provision of its articles
of incorporation, bylaws or other governing documents, or (b) conflict with,
result in a breach of, constitute a default under, result in the acceleration
of, create in any Person the right to accelerate (whether after the giving of
notice or lapse of time or both), terminate, modify or cancel, or require any
notice under any Contract, lease or License to which

                                       14



Buyer is a party, by which it is bound or to which any of its assets is subject
other than those breaches, defaults, violations or conflicts which have not had,
and would not reasonably be likely to have, individually or in the aggregate, a
Material Adverse Effect on Buyer.

            3.2.5 Sufficient Expertise. Buyer has sufficient expertise,
including in business and financial matters, to (a) evaluate the risks related
to Buyer's decision to assume its obligations under this Agreement and the
transactions contemplated hereby, and (b) make an informed investment decision
with respect to such acquisition.

            3.2.6 Investment. Buyer is acquiring the Units pursuant to this
Agreement for Buyer's own account for investment only and not with a view to, or
for sale in connection with, any distribution of any Unit in violation of the
Securities Act. Buyer has no present intention of distributing or selling any
acquired Unit, and Buyer has no present or contemplated agreement, undertaking,
arrangement, obligation, indebtedness or commitment providing for the
disposition of any acquired Unit. Buyer is an "accredited investor" within the
meaning of Rule 501(a) under the Securities Act. Buyer understands that (a) the
Units have not been registered under the Securities Act and are "restricted
securities" within the meaning of Rule 144 under the Securities Act, and (b) the
Units cannot be sold, transferred or otherwise disposed of unless they are
subsequently registered under the Securities Act or an exemption from
registration is then available.

            3.2.7 Forward-Looking Information. With respect to any
forward-looking information about the Company received by Buyer in conjunction
with the transactions contemplated by this Agreement, Buyer has received no
assurances or guarantees that the Company actually will or will not achieve the
plans, intentions, objectives or expectations disclosed in any such
forward-looking information since the Company's actual results could differ
materially from the plans, intentions, objectives and expectations disclosed in
such forward-looking information.

            3.2.8 Pending Proceedings.

                  (A)   No actions, suits, arbitrations, mediations or other
                        legal proceedings by any Third Party, and no
                        administrative proceedings or governmental
                        investigations, in each instance, are pending or, to the
                        Knowledge of Buyer is threatened, against or affecting
                        Buyer which reasonably could be expected to impact
                        Buyer's ability to consummate the transactions
                        contemplated by this Agreement.

                  (B)   No bankruptcy or insolvency proceeding of any character,
                        including receivership, reorganization, dissolution or
                        arrangement with creditors, voluntary or involuntary,
                        has been filed or initiated with respect to Buyer.

            3.2.9 Brokers. Neither Buyer nor any Person acting on Buyer's behalf
has retained or dealt with any Person who is entitled, directly or indirectly,
to a broker's commission, finder's fee, investment banker's fee or similar
payment from Sellers or the Company with respect to the negotiations leading up
to the execution of this Agreement or the consummation of the transactions
contemplated hereby.

                                       15


            3.2.10 Due Diligence. With respect to its evaluation of the merits
and risks of its decision to assume its obligations under this Agreement and the
transactions contemplated hereby, Buyer has (a) had an adequate opportunity to
conduct due diligence and to obtain such information about the Company as Buyer
deems necessary, (b) conducted due diligence to the extent deemed necessary by
Buyer, and (c) received adequate information about the Company.

            3.2.11 Full Disclosure. To the Knowledge of Buyer, no representation
or warranty by Buyer in this Agreement and no statement contained in any
document, certificate or other writing furnished or to be furnished by Buyer to
Sellers pursuant to this Agreement contains or will contain any untrue statement
of material fact or omits or will omit to state any material fact necessary, in
light of the circumstances under which it was made, to make the statements
herein or therein not misleading.

            3.2.12 Update of Information. Each of the representations made by
Buyer in this Section 3.2 shall be deemed made and given on the Agreement Date
and continuously thereafter until the Closing. During the period from the
Agreement Date until the Closing, Buyer promptly shall give Sellers written
notice at such times as Buyer determines that any representation made in this
Section 3.2 would cease to be correct if such representation were made on such
date, contains any untrue statement of a material fact or omits to state a
material fact necessary to make such representation not misleading. To be
effective, each such notice shall (a) identify, by section reference, the
representation as to which the notice relates, and (b) correctly restate the
representation.

      3.3 REPRESENTATIONS AND WARRANTIES OF CH. CH hereby represents to Buyer
that the following facts and circumstances are true and correct and CH
acknowledges that such facts and circumstances constitute a material inducement
for the execution of this Agreement by Buyer:

            3.3.1 Organization and Good Standing. CH is a limited liability
company, duly organized, validly existing and in good standing under the laws of
the State of Missouri.

            3.3.2 Authority and Enforceability. CH has full power and authority,
including full corporate power and authority, to execute, deliver and perform
its respective obligations under this Agreement. The execution, delivery and
performance of this Agreement and all other agreements contemplated by this
Agreement have been duly authorized by CH. Assuming the due authorization,
execution and delivery by each other Party, this Agreement constitutes a valid
and legally binding obligation of CH, enforceable in accordance with its
respective terms and conditions.

            3.3.3 Consents. CH is not required to give any notice to, make any
filing with or obtain any authorization, consent or approval of any Governmental
Entity in order to consummate the transactions contemplated by this Agreement
other than as may be required of CH (a) under the HSR Act, and (b) to obtain any
required approval or consent from, or make any disclosure to, DOI or the State
Agency.

                                       16


            3.3.4 Non-Contravention. Neither the execution and the delivery of
this Agreement nor the consummation of the transactions contemplated by this
Agreement will (a) violate any constitution, statute, regulation, rule, License,
injunction, judgment, order, decree, ruling, charge or other restriction of any
Governmental Entity to which CH is subject or any provision of its articles of
organization, operating agreement or other governing documents, or (b) conflict
with, result in a breach of, constitute a default under, result in the
acceleration of, create in any Person the right to accelerate (whether after the
giving of notice or lapse of time or both), terminate, modify or cancel, or
require any notice under any Contract, lease or License to which CH is a party,
by which it is bound or to which any of its assets is subject other than those
breaches, defaults, violations or conflicts which have not had, and would not
reasonably be likely to have, individually or in the aggregate, a Material
Adverse Effect on CH.

            3.3.5 Brokers. Neither CH nor any Person acting on CH's behalf has
retained or dealt with any Person who is entitled, directly or indirectly, to a
broker's commission, finder's fee, investment banker's fee or similar payment
from Buyer or the Company with respect to the negotiations leading up to the
execution of this Agreement or the consummation of the transactions contemplated
hereby.

            3.3.6 Title to Class A Units. CH has good and marketable title to
80.1 Class A Units and such Class A Units are free and clear of all Liens other
than certain agreements which will be terminated on or before the Closing Date.
CH is not a party to (a) any voting trust, proxy or other agreement or
understanding with respect to the voting of any of its membership interests in
the Company.

            3.3.7 Pending Proceedings.

                  (A)   No actions, suits, arbitrations, mediations or other
                        legal proceedings by any Third Party, and no
                        administrative proceedings or governmental
                        investigations, in each instance, are pending or, to the
                        Knowledge of CH is threatened, against or affecting CH
                        which reasonably could be expected to impact CH's
                        ability to consummate the transactions contemplated by
                        this Agreement.

                  (B)   No bankruptcy or insolvency proceeding of any character,
                        including receivership, reorganization, dissolution or
                        arrangement with creditors, voluntary or involuntary,
                        has been filed or initiated with respect to CH.

            3.3.8 Full Disclosure. To the Knowledge of CH, no representation or
warranty by CH in this Agreement and no statement contained in any document,
certificate or other writing furnished or to be furnished by CH to Buyer
pursuant to this Agreement contains or will contain any untrue statement of
material fact or omits or will omit to state any material fact necessary, in
light of the circumstances under which it was made, to make the statements
herein or therein not misleading.

                                       17


            3.3.9 Update of Information. Each of the representations made by CH
in this Section 3.3 shall be deemed made and given on the Agreement Date and
continuously thereafter until the Closing. During the period from the Agreement
Date until the Closing, CH promptly shall give Buyer written notice at such
times as CH determines that any representation made in this Section 3.3 would
cease to be correct if such representation were made on such date, contains any
untrue statement of a material fact or omits to state a material fact necessary
to make such representation not misleading. To be effective, each such notice
shall (a) identify, by section reference, the representation as to which the
notice relates, (b) correctly restate the representation, and (c) if applicable,
be accompanied by an amendment to any Section of the Disclosure Schedule which
identifies the exception(s) to the representation.

      3.4 REPRESENTATIONS AND WARRANTIES OF SELLERS REGARDING THE COMPANY. Each
Seller hereby represents to Buyer that the following facts and circumstances
regarding the Company are true and correct and acknowledge that such facts and
circumstances constitute a material inducement for the execution of this
Agreement by Buyer:

            3.4.1 Organization and Good Standing. The Company is a limited
liability company, duly organized, validly existing and in good standing under
the laws of the State of Missouri. The Company has full corporate power and
authority and all Licenses, permits and authorizations necessary to carry on the
Business as now presently conducted and to own, lease and operate the properties
and assets the Company now owns or leases. The Company is qualified to conduct
business in all states and other jurisdictions where the nature of the business
transacted by the Company makes such qualification necessary.

            3.4.2 Authority and Enforceability. The Company has full power and
authority, including full corporate power and authority, to execute, deliver and
perform its respective obligations under this Agreement. The execution, delivery
and performance of this Agreement and all other agreements contemplated by this
Agreement have been duly authorized by The Company. Assuming the due
authorization, execution and delivery by each other Party, this Agreement
constitutes a valid and legally binding obligation of The Company, enforceable
in accordance with its respective terms and conditions.

            3.4.3 Consents. The Company is not required to give any notice to,
make any filing with or obtain any authorization, consent or approval of any
Governmental Entity in order to consummate the transactions contemplated by this
Agreement other than (a) as may be required under the HSR Act, and (b) to obtain
any required approval or consent from, or make any disclosure to, DOI or the
State Agency.

            3.4.4 Non-Contravention. Except as set forth in Section 3.4.4 of the
Disclosure Schedule, neither the execution and the delivery of this Agreement
nor the consummation of the transactions contemplated by this Agreement will (a)
violate any constitution, statute, regulation, rule, License, injunction,
judgment, order, decree, ruling, charge or other restriction of any Governmental
Entity to which the Company is subject or any provision of its articles of

                                       18


organization, operating agreement or other governing documents, (b) conflict
with, result in a breach of, constitute a default under, result in the
acceleration of, create in any Person the right to accelerate (whether after the
giving of notice or lapse of time or both), terminate, modify or cancel, or
require any notice under any Contract, Lease or License to which the Company is
a party, by which it is bound or to which any of its assets is subject other
than those breaches, defaults, violations or conflicts which have not had, and
would not reasonably be likely to have, individually or in the aggregate, a
Material Adverse Effect on the Company, or (c) create any Lien upon the
Company's assets.

            3.4.5 Brokers. Neither the Company nor any Person acting on the
Company's behalf has retained or dealt with any Person who is entitled, directly
or indirectly, to a broker's commission, finder's fee, investment banker's fee
or similar payment from Buyer or the Company with respect to the negotiations
leading up to the execution of this Agreement or the consummation of the
transactions contemplated hereby.

            3.4.6 Pending Proceedings.

                  (A)   No actions, suits, arbitrations, mediations or other
                        legal proceedings by any Third Party, and no
                        administrative proceedings or governmental
                        investigations, in each instance, are pending or, to the
                        Knowledge of CH, to the Knowledge of Any of the
                        Executives or to the Knowledge of SMHS is threatened,
                        against or affecting the Company which reasonably could
                        be expected to impact the Company's ability to
                        consummate the transactions contemplated by this
                        Agreement.

                  (B)   No bankruptcy or insolvency proceeding of any character,
                        including receivership, reorganization, dissolution or
                        arrangement with creditors, voluntary or involuntary,
                        has been filed or initiated with respect to the Company.

            3.4.7 Officers and Board Members. The name of each officer and
member of the Board of the Company on the Agreement Date and his or her position
with the Company are set forth in Section 3.4.7 of the Disclosure Schedule.

            3.4.8 Company Documents. True and complete copies of the Company
Articles and the Operating Agreement, and all amendments thereto, each as in
effect on the Agreement Date, and organizational minute books and records of the
Company, (a) have been made available for inspection by Buyer, (b) shall be
maintained at an office of the Company prior to the Closing, and (c) shall be
located at such location and remain thereat as of the Closing.

            3.4.9 Ownership of the Company and Related Matters.

                  (A)   The books, records and Operating Agreement of the
                        Company correctly reflect that (i) CH owns 80.1 Class A
                        Units, and (ii) 80.1 Class A Units represent (A) 100% of
                        the Class A Units issued by the Company, and (B) 40.050%
                        of the economic interests of the Company.

                                       19


                  (B)   The books, records and Operating Agreement of the
                        Company correctly reflect that (i) the Executives
                        collectively own 19.9 Class B Units, and (ii) 19.9 Class
                        B Units represent (A) 100% of the Class B Units issued
                        by the Company, and (B) 9.950% of the economic interests
                        of the Company.

                  (C)   The books, records and Operating Agreement of the
                        Company correctly reflect that (i) Linder owns 8.358
                        Class B Units, and (ii) 8.358 Class B Units represent
                        (A) 42% of the Class B Units issued by the Company, and
                        (B) 4.179% of the economic interests of the Company.

                  (D)   The books, records and Operating Agreement of the
                        Company correctly reflect that (i) Cristea owns 7.562
                        Class B Units, and (ii) 7.562 Class B Units represent
                        (A) 38% of the Class B Units issued by the Company, and
                        (B) 3.781% of the economic interests of the Company.

                  (E)   The books, records and Operating Agreement of the
                        Company correctly reflect that (i) Oswald owns 3.98
                        Class B Units, and (ii) 3.98 Class B Units represent (A)
                        20% of the Class B Units issued by the Company, and (B)
                        1.990% of the economic interests of the Company.

                  (F)   The books, records and Operating Agreement of the
                        Company correctly reflect that (i) SMHS owns 100 Class C
                        Units, and (ii) 100 Class C Units represent (A) 100% of
                        the Class C Units issued by the Company, and (B) 50.000%
                        of the economic interests of the Company.

                  (G)   Each of the Class A Units, Class B Units and Class C
                        Units has been duly authorized, is validly issued, fully
                        paid and non-assessable.

                  (H)   There are no outstanding or authorized options,
                        warrants, purchase rights, subscription rights,
                        conversion rights, exchange rights or other Contracts or
                        commitments which could require the Company to issue,
                        sell or otherwise cause to become outstanding any of the
                        Company's membership interests or any other ownership or
                        equity interest of the Company. Except as set forth in
                        the Executive Employment Agreements, the Company is not
                        subject to any obligations (contingent or otherwise) to
                        purchase or otherwise acquire or retire any of the Units
                        from CH, SMHS or any

                                       20

\
                        Executive. The Company has neither outstanding nor
                        authorized any stock appreciation, phantom stock, profit
                        participation or similar right.

                  (I)   The Company is not a party to any Contract or commitment
                        which could require the Company to issue any membership
                        interests in the Company.

            3.4.10 Title to Assets. Except as set forth in Section 3.4.10 of the
Disclosure Schedule, the Company has good and marketable title to, or a valid
leasehold interest in, the tangible assets used in the conduct of the Business,
free and clear of all Liens other than Permitted Liens.

            3.4.11 Financial Reports.

                  (A)   Complete and accurate copies of the Financial Statements
                        are set forth at Section 3.4.11(a) of the Disclosure
                        Schedule. The audited Financial Statements accurately
                        reflect the books and records of the Business and
                        present fairly in all material respects the financial
                        condition of the Company as of their respective dates
                        and/or for their respective designated periods.

                  (B)   The unaudited Financial Statements for the period from
                        January 1, 2007 through July 31, 2007, have been
                        prepared in accordance with GAAP (except that (i)
                        footnotes have been omitted, and (ii) such statements
                        are subject to normal, recurring adjustments),
                        accurately reflect the books and records of the Business
                        and, subject to the foregoing, present fairly in all
                        material respects the financial condition of the Company
                        as of the date thereof.

                  (C)   The reserves reflected in the audited Financial
                        Statements for unpaid medical benefits, losses, claims
                        and expenses incurred in connection with the Medicaid
                        business of the Company were computed by the Company and
                        reviewed by independent licensed actuaries serving the
                        Company during the periods covered using assumptions
                        consistent with those used in computing the
                        corresponding reserves in the prior fiscal periods
                        except as set forth at Section 3.4.11(c) of the
                        Disclosure Schedule.

            3.4.12 Legal Compliance. The Company (a) is in compliance in all
material respects with all Laws, including HIPAA, (b) has obtained business
association agreements as required by HIPAA, (c) has provided an accounting of
disclosures to Enrollees as required by HIPAA, and (d) has not received any
notice from any Governmental Entity which alleges any violations of Laws by the
Company.

                                       21


            3.4.13 Licenses. The Company holds all licenses, including a
certificate issued by the DOI to operate as a health maintenance organization in
the State, which are necessary for the lawful conduct of the Business in the
manner in which it is conducted as of the Agreement Date, and to own and use its
assets in the manner in which its assets are used as of the Agreement Date. Each
such License has been duly obtained, is valid, in good standing and in full
force and effect. The Company has duly performed in all material respects all of
its obligations under such Licenses.

            3.4.14 Tax Matters. Except as set forth in Section 3.4.14 of the
Disclosure Schedule:

                  (A)   All Tax Returns of the Company have been duly filed and
                        all Taxes of the Company have been duly paid or an
                        adequate reserve for such payment has been established
                        therefore in the Financial Statements; provided,
                        however, Tax liabilities for any specified period are
                        subject to offset by any Tax refunds or credits related
                        to any other period prior to the Closing.

                  (B)   All Tax Returns of the Company are true, correct and
                        complete in all material respects, and there is no
                        position taken on any such Tax Return for which there is
                        not substantial authority within the meaning of Section
                        6662 of the Code.

                  (C)   The Company has timely withheld and paid all Taxes
                        required to have been withheld and paid in connection
                        with any amounts paid or owing to any Executive,
                        Employee, independent contractor, creditor, member or
                        other Third Party, including amounts required to be
                        withheld under Sections 1441 and 1442 of the Code (or
                        similar provisions of state, local or non-U.S. Laws).

                  (D)   The aggregate unpaid Taxes of the Company do not and
                        will not exceed in any material respect the reserve for
                        Tax liability (excluding any reserve for deferred Taxes
                        established to reflect timing differences between book
                        and Tax income) reflected in the Financial Statements.

                  (E)   There are no Liens for Taxes (other than for current
                        Taxes not yet required to be paid) upon any assets of
                        the Company.

                  (F)   The Company is, and has been since its formation,
                        classified as an association taxable as a corporation
                        for all income Tax purposes.

                  (G)   The Company (i) since May 17, 2006, is not a member of
                        an "affiliated group" within the meaning of Section 1504
                        of the Code, and (ii) does not have any liability for
                        the Taxes of any Person under Treasury Regulation
                        Section 1.1502-6 (or similar provision of state, local
                        or non-U.S. Laws) as a transferee or successor, by
                        Contract or otherwise.

                                       22


                  (H)   The Company is not a party to or bound by any Tax
                        indemnity, Tax sharing or Tax allocation agreement or
                        arrangement.

                  (I)   The Company is not a party to or a partner in any joint
                        venture, partnership or other arrangement or Contract
                        that could be treated as a partnership for Federal
                        income tax purposes.

                  (J)   Since January 1, 2001, no claim has ever been made by a
                        taxing authority in a jurisdiction in which the Company
                        does not file Tax Returns that the Company is or may be
                        subject to taxation by such jurisdiction.

                  (K)   No Federal, state, local or non-U.S. Tax audits or
                        administrative or judicial Tax proceedings are pending
                        or being conducted with respect to the Company as to
                        which the Company has received written notification.

                  (L)   The Company has not received from any Federal, state,
                        local or non-U.S. Tax authority (including jurisdictions
                        in which the Company has not filed a Tax Return) any (i)
                        written notice indicating an intent to open an audit or
                        other review, (ii) request for information related to
                        Tax matters, or (iii) written notice of deficiency or
                        proposed adjustment for any amount of Tax proposed,
                        asserted or assessed by any Tax authority against the
                        Company.

                  (M)   The Company has not waived any statutes of limitation in
                        respect of Taxes or agreed to any extension of time with
                        respect to a Tax assessment or deficiency.

                  (N)   True, correct and complete copies of (i) all income Tax
                        Returns, and (ii) all Tax examination reports and
                        statements of deficiencies assessed against the Company
                        or agreed upon by the Company, in each instance,
                        covering the three years preceding the Agreement Date,
                        have been made available to Buyer.

                  (O)   The Company is not a party to any agreement, Contract,
                        arrangement or plan that has resulted, or would result,
                        in a payment that would not be fully deductible as a
                        result of Section 162(m) or Section 280G of the Code or
                        any similar provision of non-U.S., state or local Laws.

                                       23


                  (P)   The Company has not been a United States real property
                        holding corporation within the meaning of Section
                        897(c)(2) of the Code during the applicable period
                        specified in Section 897 of the Code.

                  (Q)   The Company will not be required to include any item of
                        income in, or exclude any item of deduction from,
                        taxable income for any taxable period (or portion
                        thereof) ending after the Closing Date as a result of
                        any (i) "closing agreement" as described in Section 7121
                        of the Code (or any corresponding or similar provision
                        of state, local or non-U.S. Tax Law) executed on or
                        prior to the Closing Date, or (ii) change in method of
                        accounting for a Tax period ending on or prior to the
                        Closing Date.

            3.4.15 Real Property.

                  (A)   The Company does not own any real property.

                  (B)   Section 3.4.15(b) of the Disclosure Schedule lists all
                        Leased Real Property. Company has delivered to Buyer a
                        true and complete copy of each such Lease as of the
                        Agreement Date. Each such Lease (a) is in full force and
                        effect, (b) constitutes the valid and legally binding
                        obligation of the Company, and (c) does not require the
                        consent of the landlord/lessor as a result of the
                        Closing. The Company is not in breach or default under
                        any such Lease and, to the Knowledge of CH, to the
                        Knowledge of Any of the Executives or to the Knowledge
                        of SMHS, no event has occurred or circumstance exists
                        which, with the delivery of notice, the passage of time
                        or both, would constitute such a breach or default.

                  (C)   No condemnation proceedings are pending, or to the
                        Knowledge of CH, to the Knowledge of Any of the
                        Executives or to the Knowledge of SMHS, threatened, with
                        respect to any real property which is the subject of a
                        Lease.

            3.4.16 Intellectual Property.

                  (A)   Section 3.4.16(a) of the Disclosure Schedule lists all
                        Intellectual Property (except for readily available
                        off-the-shelf software having an original purchase price
                        of less than $25,000) used in the Business, in each case
                        specifying whether the Intellectual Property is owned or
                        licensed by the Company.

                  (B)   Except as set forth in Section 3.4.16(b) of the
                        Disclosure Schedule:

                        (I)   The Company owns and possesses all right, title
                              and interest in and to, free and clear of any
                              Liens other than

                                       24


                              Permitted Liens, or has a valid, enforceable and
                              effective license to use, all of the Intellectual
                              Property identified in Section 3.4.16(a) of the
                              Disclosure Schedule;

                        (II)  During the five-year period preceding the
                              Agreement Date, the Company has received no Claim
                              by any Third Party contesting the validity, grant,
                              registrability, enforceability, use or ownership
                              of any Intellectual Property identified in Section
                              3.4.16(a) of the Disclosure Schedule and, to the
                              Knowledge of CH, to the Knowledge of Any of the
                              Executives or to the Knowledge of SMHS, no such
                              Claim has been threatened during such period;

                        (III) To the Knowledge of CH, to the Knowledge of Any of
                              the Executives or to the Knowledge of SMHS, no
                              Third Party is infringing upon the Intellectual
                              Property identified in Section 3.4.16(a) of the
                              Disclosure Schedule;

                        (IV)  To the Knowledge of CH, to the Knowledge of Any of
                              the Executives or to the Knowledge of SMHS the use
                              of the Intellectual Property identified in Section
                              3.4.16(a) of the Disclosure Schedule does not
                              infringe upon or otherwise violate the rights of
                              any Third Party; and

                        (V)   The Company has not brought or threatened a Claim
                              against any Person alleging infringement upon or
                              any other violation of the Intellectual Property
                              identified in Section 3.4.16(a) of the Disclosure
                              Schedule or challenging any Person's ownership or
                              use of, or the validity, enforceability or
                              registrability of, any Intellectual Property
                              identified in Section 3.4.16(a) of the Disclosure
                              Schedule except for Claims that were favorably
                              resolved.

                  (C)   The Company has not licensed or sublicensed its rights
                        in any of the Intellectual Property identified in
                        Section 3.4.16(a) of the Disclosure Schedule.

                  (D)   Each copyright registration, patent and registered
                        trademark and application therefor identified in Section
                        3.4.16(a) of the Disclosure Schedule is in proper form,
                        not disclaimed and has been duly maintained, including
                        the submission of all necessary filings in accordance
                        with the legal and administrative requirements of the
                        appropriate jurisdictions.

                  (E)   None of the Intellectual Property requires the consent
                        of the licensor or developer as a result of the Closing.

                                       25


            3.4.17 Contracts (Other than Provider Agreements).

                  (A)   Section 3.4.17(a) of the Disclosure Schedule lists the
                        following undischarged Contracts, including all
                        amendments thereto, to which the Company is a party and
                        which have not expired or terminated:

                        (I)   Contracts with any Governmental Entity (including
                              the Medicaid Contracts);

                        (II)  Executive Employment Agreements;

                        (III) Other Employment Agreements;

                        (IV)  Contracts for consulting services;

                        (V)   Company policies or Contracts for the payment of
                              severance benefits or retention bonuses to any
                              Employee other than the Executives;

                        (VI)  Contracts for the purchase of equipment or other
                              materials in which the purchase price of such
                              equipment or other materials exceeds $25,000;

                        (VII) Contracts for the sale of any of the Company's
                              equipment or other assets;

                        (VIII) Contracts for services, other than Provider
                              Agreements, which provide for the expenditure of
                              more than $50,000 annually (including the Contract
                              between the Company and NovaSys Health System);

                        (IX)  Leases or subleases, either as lessee or
                              sublessee, lessor or sublessor, of personal
                              property or intangibles, in which the Lease or
                              sublease provides for an annual rent in excess of
                              $25,000 and has an unexpired term as of the
                              Closing Date in excess of one year (including the
                              office space lease for 10123 Corporate Square
                              Drive, St. Louis, Missouri);

                        (X)   Contracts, other than Provider Agreements,
                              restricting in any manner the Company's right to
                              (a) compete with any other Person, (b) sell to or
                              purchase from any other Person, or (c) contract or
                              conduct business with any other Person;

                        (XI)  Service Contracts affecting any Tangible Asset in
                              which the annual service or maintenance charge
                              exceeds $25,000 and the unexpired term as of the
                              Closing Date exceeds one year;

                                       26


                        (XII) Contracts for the advertisement, display or
                              promotion of any products or services which cannot
                              be canceled by the Company without payment or
                              penalty upon notice of less than 32 days;

                        (XIII) Loan or credit agreements, pledge agreements,
                              notes, security agreements, mortgages, debentures,
                              indentures, factoring agreements or letters of
                              credit;

                        (XIV) Guarantees, performance, bid or completion bonds,
                              or surety or indemnification agreements;

                        (XV)  Contracts involving a sharing of profits, losses,
                              costs or liabilities by the Company and another
                              Person; or

                        (XVI) Any other Contracts, other than Provider
                              Agreements, which provide for the receipt or
                              expenditure of more than $100,000 or which expire,
                              or may be renewed at the option of any Person
                              other than the Company so as to expire, more than
                              one year after the Agreement Date.

                  (B)   All Designated Contracts are in full force and effect
                        and constitute legal, valid and enforceable rights and
                        obligations of the Company in accordance with their
                        terms. The Company is, in all material respects, in
                        compliance with the terms and requirements of each
                        Designated Contract. To the Knowledge of CH, to the
                        Knowledge of Any of the Executives or to the Knowledge
                        of SMHS, (i) each other Person who or which is party to
                        a Designated Contract is in compliance with the terms
                        and requirements of such Contract, and (ii) no event has
                        occurred or circumstance exists which (with or without
                        notice or lapse of time) may contravene, conflict with
                        or result in a violation or breach of, or give the
                        Company or any other Person the right to declare a
                        default or exercise any remedy under, or to accelerate
                        the maturity or performance of, or to cancel, terminate
                        or modify any Designated Contract. Except as set forth
                        in Section 3.4.17(b) of the Disclosure Schedule, there
                        are no renegotiations, attempts to renegotiate or
                        outstanding rights to negotiate any amount to be paid or
                        payable to or by the Company under any Designated
                        Contract other than with respect to non-material amounts
                        in the Ordinary Course of Business, and no Person has
                        made a written demand for such renegotiation. The
                        Company has not released or waived any of its rights
                        under any Designated Contract.

                                       27


                  (C)   Except for Designated Contracts and Provider Agreements,
                        there are no material Contracts relating to the
                        Business.

                  (D)   The Company has made available to Buyer (i) a correct
                        and complete copy of each written Designated Contract,
                        including any amendments thereto, and (ii) a written
                        description of any oral Designated Contract. Correct and
                        complete copies of each written Contract relating to the
                        Business are maintained at an office of the Company
                        located on the Leased Real Property.

                  (E)   No Designated Contract requires the consent of the other
                        contracting party as a result of the Closing.

            3.4.18 Litigation.

                  (A)   The Company is not (i) subject to any outstanding
                        injunction, judgment, order, decree or ruling by a
                        Governmental Entity, or (ii) a party to or the subject
                        of, or to the Knowledge of CH, to the Knowledge of Any
                        of the Executives or to the Knowledge of SMHS threatened
                        to be made a party to or the subject of, any action,
                        suit, proceeding, hearing or investigation in or before
                        any Governmental Entity, in which the action, suit,
                        proceeding, hearing, or investigation has had or would
                        reasonably be likely to have a Material Adverse Effect.

                  (B)   None of the Company's officers, managers, employees or
                        agents is a party to or the subject of, or to the
                        Knowledge of CH, to the Knowledge of Any of the
                        Executives or to the Knowledge of SMHS threatened to be
                        made a party to or the subject of, any action, suit,
                        proceeding, hearing or investigation involving,
                        affecting or relating to the Business in or before any
                        Governmental Entity, arbitrator or mediator.

                  (C)   The Company has made available to Buyer true, correct
                        and complete copies of all audit response letters
                        pertaining to Company received in the past three years.

            3.4.19 Medical Claims. Set forth at Section 3.4.19 of the Disclosure
Schedule are summary reports identifying, to the Knowledge of CH, to the
Knowledge of Any of the Executives or to the Knowledge of SMHS, known but unpaid
Medical Claims as of July 31, 2007 which (a) lack sufficient information to be
adjudicated for payment or are otherwise pending for review, (b) are disputed,
(c) have been adjudicated for payment and are awaiting a payment run, or (d)
have been received but time has not yet permitted consideration for adjudication
for payment.

                                       28


            3.4.20 Employment.

                  (A)   Section 3.4.20(a) of the Disclosure Schedule sets forth
                        a true, correct and complete list of all Employees,
                        other than the Executives, together with each such
                        Employee's date of hire and title or job position. The
                        Company has made available to Buyer each such Employee's
                        current hourly wage or annual salary, bonus, accrued
                        vacation, paid time off and the amount of any other
                        accrued benefits to which such Employee may be entitled
                        or for which such Employee has made a written or oral
                        claim to the Company.

                  (B)   Except as set forth in Section 3.4.20(b) of the
                        Disclosure Schedule, (i) no Employee other than an
                        Executive has an employment agreement with the Company,
                        whether written or oral, (ii) to the Knowledge of CH, to
                        the Knowledge of Any of the Executives or to the
                        Knowledge of SMHS, no Person employed by the Company on
                        the Agreement Date intends to terminate his or her
                        employment with the Company or to seek a change in his
                        or her duties or status prior to or following the
                        Closing, and (iii) no Employee (including any Executive)
                        has been or shall be paid as of the Closing total salary
                        and bonus that is not deductible as an ordinary and
                        necessary expense to carry on a trade or business.

            3.4.21 Employee Benefits.

                  (A)   Section 3.4.21(a) of the Disclosure Schedule lists each
                        Benefit Plan, including the name of the sponsor of each
                        Benefit Plan. Each Benefit Plan may be amended or
                        terminated by the Company pursuant to the terms of such
                        Benefit Plan.

                  (B)   Except as identified in Section 3.4.21(b) of the
                        Disclosure Schedule, the Company has no commitment to
                        create any additional Benefit Plan or to modify or
                        change any existing Benefit Plan.

                  (C)   All contributions, premiums or other payments due from
                        the Company have been made to each Benefit Plan on a
                        timely basis in accordance with ERISA, the Code and the
                        terms of the applicable Benefit Plan.

                  (D)   Section 3.4.21(d) of the Disclosure Schedule lists each
                        Benefit Plan intended to be qualified under Section
                        401(a) of the Code and exempt from tax under Section
                        501(a) of the Code. Each Benefit Plan so listed and its
                        related trust, if any, are qualified under Section
                        401(a) of the Code and exempt from tax under Section
                        501(a) of the Code and either has been determined by the
                        IRS to qualify thereunder pursuant to a currently valid
                        determination letter

                                       29


                        or such Benefit Plan is a master or prototype plan
                        document and the prototype plan sponsor has received a
                        favorable determination letter from the IRS. No events
                        have occurred which could adversely affect the qualified
                        status of any such Benefit Plan or the tax-exempt status
                        of its related trust.

                  (E)   Except for routine claims for benefits, no action, suit,
                        proceeding, hearing or investigation is pending or, to
                        the Knowledge of CH, to the Knowledge of Any of the
                        Executives or to the Knowledge of SMHS is threatened,
                        with respect to any aspect of any Benefit Plan.

                  (F)   Each Benefit Plan and related trust agreement, annuity
                        contract or other funding instrument complies with and
                        has been administered in all material respects
                        accordance with its terms and applicable Laws. Neither
                        the Company nor any Benefit Plan has engaged in a
                        transaction or has taken or failed to take any action
                        for which the Company could be subject to any material
                        liability under Sections 409 or 502(i) of ERISA or
                        Sections 4975, 4976 or 4980B of the Code.

                  (G)   No Benefit Plan intended to be qualified under Section
                        401(a) of the Code is subject to the funding
                        requirements of Section 412 of the Code.

                  (H)   The Company has not terminated a Benefit Plan which is
                        an employee pension benefit plan as defined in Section
                        3(2) of ERISA within the six-year period preceding the
                        Closing Date.

            3.4.22 Environmental, Health and Safety Matters. The Business is in
compliance in all material respects with all Environmental, Health and Safety
Requirements. The Company has not received any written notice, demand, request
for information, citation, summons, report or other information regarding any
actual or alleged violation by the Company of any Environmental, Health and
Safety Requirement.

            3.4.23 Certain Business Relationships. No officer or manager of the
Company (a) owns any property or assets necessary for the Business, or (b) has
any material ownership interest in any Person who or which (i) has business
dealings with the Company, or (ii) competes with the Business.

            3.4.24 Undisclosed Liabilities. The Company has no material
liabilities or obligations of any nature, whether absolute, contingent or
otherwise, other than liabilities or obligations (a) accrued or reserved for on
the balance sheets included in the Financial Statements, (b) set forth in the
Disclosure Schedule, including in Section 3.4.17 thereof, or (c) incurred after
June 30, 2007, in the Ordinary Course of Business.

                                       30


            3.4.25 Labor Matters.

                  (A)   The Company is not a party to, bound by or subject to
                        any collective bargaining agreement or similar agreement
                        with any union or labor organization and there are no
                        labor strikes, slowdowns, work stoppages or lockouts
                        currently involving the Employees.

                  (B)   To the Knowledge of CH, to the Knowledge of the
                        Executives or to the Knowledge of SMHS, (i) no union or
                        labor organization claims to represent any Employees and
                        (ii) there is no activity by any labor organization to
                        organize any Employees.

                  (C)   Except as set forth in Section 3.4.25(c) of the
                        Disclosure Schedule, (i) there are no charges with
                        respect to or relating to any Employee pending before
                        the Equal Employment Opportunity Commission or any other
                        Governmental Entity responsible for the prevention of
                        unlawful employment practices, and (ii) the Company has
                        not received notice of the intent of any Governmental
                        Entity responsible for the enforcement of labor or
                        employment laws to conduct an investigation with respect
                        to or relating to any Employee.

                  (D)   The Company has properly classified (i) all Persons
                        providing services to the Company as employees or
                        independent contractors, as applicable, and (ii) all
                        Employees as exempt or non-exempt, as applicable, under
                        the Fair Labor Standards Act or similar Law.

                  (E)   Except as set forth in Section 3.4.25(e) of the
                        Disclosure Schedule, other than with respect to
                        implementation of a Forgiveness or payment of a Gross-Up
                        Payment, no Employee has any claim against the Company
                        on account of or for: (i) overtime pay other than
                        overtime pay for the payroll period covering the
                        Agreement Date, (ii) wages or salaries other than wages
                        or salaries for the payroll period overlapping the
                        Agreement Date, or (iii) vacations, sick leave, time off
                        or pay in lieu of vacation, sick leave or time off other
                        than vacation, sick leave or time off (or pay in lieu
                        thereof) earned in the 12-month period immediately prior
                        to the Agreement Date.

                  (F)   The Company has made all required payments to the
                        relevant unemployment compensation reserve account with
                        the appropriate governmental departments with respect to
                        its employees and such accounts have positive balances.

                                       31


            3.4.26 Related Party Transactions.

                  (A)   The Company does not own any interest in, whether debt
                        or equity, and, to the Knowledge of CH, to the Knowledge
                        of Any of the Executives or to the Knowledge of SMHS the
                        Company has not owned, either directly or indirectly,
                        any interest in, whether debt or equity, any
                        corporation, partnership, joint venture, business trust
                        or other entity.

                  (B)   Except for the Executive Employment Agreements, Provider
                        Agreements or as set forth in Section 3.4.26(b) of the
                        Disclosure Schedule, to the Knowledge of CH, to the
                        Knowledge of Any of the Executives or to the Knowledge
                        of SMHS, no (i) Seller, manager, officer or Employee, or
                        any member of the family of any such Person, or (ii)
                        corporation, partnership, trust or other entity in which
                        any such Person, or any member of the family of any such
                        Person, has a substantial interest or is an officer,
                        director, trustee or partner, is a party to any
                        transaction with the Company, including any Contract or
                        other arrangement providing for the furnishing of goods
                        or services by, rental of real or personal property from
                        or to, or otherwise requiring payments or involving
                        other obligations to any such Person.

            3.4.27 Suppliers. Section 3.4.27 of the Disclosure Schedule sets
forth the names of the non-health care related suppliers of the Business (ranked
in the order of the largest suppliers of such goods and services to the Company)
which supplied at least 80% of the dollar volume of non-health care related
purchases of goods or services by the Company during the twelve-month period
ending June 30, 2007. Except as identified in Section 3.4.27 of the Disclosure
Schedule, the Company has not received any written notice that any such supplier
will not sell supplies, merchandise or other goods to the Company at any time
after the Closing Date on terms and conditions substantially similar to those
currently in effect, subject only to general and customary price increases.

            3.4.28 Insurance.

                  (A)   Section 3.4.28(a) of the Disclosure Schedule (i) sets
                        forth a true, correct and complete list of all the
                        policies of fire and casualty, liability, errors and
                        omissions, workers compensation and other forms of
                        insurance maintained by the Company other than D&O
                        insurance, for the 36 months preceding the Agreement
                        Date, (ii) identifies which of such policies are
                        currently in effect, (iii) sets forth a true, correct
                        and complete list of all pending applications for such
                        policies of insurance, (iv) describes any self-insurance
                        arrangement by or affecting the Company, including any
                        reserves established thereunder, and (v) describes any
                        other Contract or arrangement for the transfer or
                        sharing of any risk by the Company.

                                       32


                  (B)   All premiums due and payable with respect to the
                        insurance policies set forth in Section 3.4.28(a) of the
                        Disclosure Schedule have been paid, the Company has
                        otherwise performed all of its obligations thereunder,
                        and no notice of cancellation or termination has been
                        received by the Company with respect to any such
                        insurance policies currently in effect.

                  (C)   The policies set forth in Section 3.4.28(a) of the
                        Disclosure Schedule which are identified as being
                        currently in effect are valid, outstanding and
                        enforceable.

                  (D)   The Company has maintained, at all times during the 36
                        months preceding the Agreement Date, insurance coverage
                        for general liability and workers' compensation.

                  (E)   All policies of insurance listed on Section 3.4.28(a) of
                        the Disclosure Schedule (i) are (or were during the
                        period of coverage) issued by an insurer that is
                        financially sound and reputable, (ii) when taken
                        together with the other then outstanding policies,
                        provide reasonably adequate insurance coverage for the
                        assets and the operations of the Company in such amounts
                        and subject to such terms as are commercially reasonable
                        for a Person carrying on the same business or businesses
                        as the Company, (iii) are sufficient for compliance with
                        all legal requirements and Contracts to which the
                        Company is a party or by which the Company is bound,
                        (iv) do not provide for any retrospective premium
                        adjustment on the part of the Company, and (v) provide
                        coverage on an occurrence basis.

                  (F)   Other than in connection with renewal in the Ordinary
                        Course of Business, during the 36 months preceding the
                        Agreement Date, the Company has not received (i) any
                        refusal of coverage or any notice that a defense will be
                        afforded with reservation of rights, or (ii) any notice
                        of cancellation or any other indication that any
                        insurance policy is no longer in full force or effect or
                        will not be renewed or that the issuer of any policy is
                        not willing or able to perform its obligations
                        thereunder.

                  (G)   The Company has given notice of all Claims that may be
                        insured to the insurer under each policy of insurance to
                        which the Company is a party or under which the Company
                        or any officer, manager or Employee is covered.

            3.4.29 D&O Insurance. Section 3.4.29 of the Disclosure Schedule sets
forth (a) a true, correct and complete list of all the policies of officers' and
directors' liability insurance covering those individuals who are officers and
directors (managers) of the Company as of the Agreement Date for their acts and
omissions in their capacity as officers and directors

                                       33


(managers) of the Company, (b) the annual aggregate premiums therefor, and (c)
describes all Claims asserted under any such policies during the 36 months
preceding the Agreement Date.

            3.4.30 Conduct of Business. Except as set forth in Section 3.4.30 of
the Disclosure Schedule, since June 30, 2007, (a) the Company has conducted the
Business only in the Ordinary Course of Business, (b) there has not been any
Material Adverse Effect, (c) there has been no non-renewal or material amendment
of the Medicaid Contracts, (d) there has been no physical damage, destruction or
other casualty loss (whether or not covered by insurance) affecting any Tangible
Assets or Leased Real Property in an amount exceeding $100,000, individually or
in the aggregate, and (e) the Company has not taken or permitted to be taken any
action which, if proposed to be taken on or after the Agreement Date, would
require the consent of Buyer pursuant to Section 4.1.

            3.4.31 Statutory Surplus. As of the Closing Date, the Company will
be in full compliance with all Laws applicable to the adequacy and maintenance
of its statutory surplus.

            3.4.32 Bank Accounts. Section 3.4.32 of the Disclosure Schedule
lists (a) the name of each bank, safe deposit company or other financial
institution in which the Company has an account, lock box or safe deposit box,
(b) the names of all Persons authorized to draw thereon or to have access
thereto, and (c) all instruments or agreements to which the Company is a party
as an endorser, surety or guarantor other than checks endorsed for collection or
deposit in the Ordinary Course of Business.

            3.4.33 Providers and Provider Agreements.

                  (A)   Section 3.4.33(a) of the Disclosure Schedule lists all
                        Provider Agreements which have not expired or
                        terminated.

                  (B)   To the Knowledge of CH, to the Knowledge of the
                        Executives and to the Knowledge of SMHS, the Company has
                        compensated and currently compensates each Provider for
                        covered services provided to Enrollees in accordance
                        with the rates and fees set forth in the applicable
                        Provider Agreement and the Company's standard payment
                        policies and procedures.

                  (C)   Except as set forth in Section 3.4.33(c) of the
                        Disclosure Schedule, there are no renegotiations,
                        attempts to renegotiate or outstanding rights to
                        negotiate any amount to be paid or payable to or by the
                        Company under any Provider Agreement other than with
                        respect to non-material amounts in the Ordinary Course
                        of Business.

                  (D)   No Provider Agreement requires the consent of any
                        Provider as the result of the Closing.

                                       34


            3.4.34 Payments under Medicaid Contracts. The Company is not a party
to or the subject of any action, suit, proceeding, hearing or investigation in
or before the State Agency related to the recovery of payments received by the
Company from the State Agency under the Medicaid Contracts. To the Knowledge of
CH, to the Knowledge of Any of the Executives or to the Knowledge of SMHS, the
Company has not been threatened to be made a party to or the subject of any such
action, suit, proceeding, hearing or investigation.

            3.4.35 Membership. Company has delivered to Buyer a complete and
accurate copy of the Monthly Remittance Advice for July 2007. A summary report
of such Monthly Remittance Advice is set forth in Section 3.4.35 of the
Disclosure Schedule.

            3.4.36 Commercial Bribery. The Company, the Executives and, to the
Knowledge of CH, to the Knowledge of Any of the Executives or to the Knowledge
of SMHS the Employees, former employees of the Company and officers, managers or
Representatives of the Company, have not paid or made, directly or indirectly,
with respect to the Business, (a) any bribes or kickbacks, (b) illegal political
contributions, (c) payments from Company funds not recorded on the books and
records of the Company, (d) payments from Company funds to governmental
officials in their individual capacities for the purpose of affecting their
action or the action of the Governmental Entity they represent to obtain
favorable treatment in securing business or Licenses or to obtain special
concessions, or (e) illegal payments from Company funds to obtain or retain
business.

            3.4.37 Full Disclosure. To the Knowledge of CH, to the Knowledge of
Any of the Executives or to the Knowledge of SMHS, no representation or warranty
made by any Seller regarding the Company in this Agreement and no statement
contained in any document (including the Financial Statements, Exhibits and
Disclosure Schedule), certificate or other writing furnished or to be furnished
by the Company to Buyer pursuant to this Agreement contains or will contain any
untrue statement of material fact or omits or will omit to state any material
fact necessary, in light of the circumstances under which it was made, to make
the statements herein or therein not misleading.

            3.4.38 Update of Information. Subject to Section 3.7, each of the
representations made by Sellers in this Section 3.4 shall be deemed made and
given on the Agreement Date and continuously thereafter until the Closing.
During the period from the Agreement Date until the Closing, Sellers promptly
shall give Buyer written notice at such times as Sellers determine that any
representation made in this Section 3.4 would cease to be correct if such
representation were made on such date, contains any untrue statement of a
material fact or omits to state a material fact necessary to make such
representation not misleading. To be effective, each such notice shall (a)
identify, by section reference, the representation as to which the notice
relates, (b) correctly restate the representation, and (c) if applicable, be
accompanied by an amendment to any Section of the Disclosure Schedule which
identifies the exceptions to the representation.

                                       35


      3.5 REPRESENTATIONS AND WARRANTIES OF THE EXECUTIVES. Each Executive
hereby represents to Buyer that the following facts and circumstances are true
and correct and acknowledges that such facts and circumstances constitute a
material inducement for the execution of this Agreement by Buyer:

            3.5.1 Authority and Enforceability. Such Executive has full capacity
to execute, deliver and perform his respective obligations under this Agreement.
Assuming the due authorization, execution and delivery by each other Party, this
Agreement constitutes a valid and legally binding obligation upon such
Executive, enforceable in accordance with its respective terms and conditions.

            3.5.2 Non-Contravention. Neither the execution and the delivery of
this Agreement nor the consummation of the transactions contemplated by this
Agreement will (a) violate any constitution, statute, regulation, rule, License,
injunction, judgment, order, decree, ruling, charge or other restriction of any
Governmental Entity to which such Executive is subject, or (b) conflict with,
result in a breach of, constitute a default under, result in the acceleration
of, create in any Person the right to accelerate (whether after the giving of
notice or lapse of time or both), terminate, modify or cancel, or require any
notice under any Contract, lease or License to which such Executive is a party,
by which it is bound or to which any of its assets is subject other than those
breaches, defaults, violations or conflicts which have not had, and would not
reasonably be likely to have, individually or in the aggregate, a Material
Adverse Effect on such Executive.

            3.5.3 Brokers. Neither such Executive nor any Person acting on such
Executive's behalf has retained or dealt with any Person who is entitled,
directly or indirectly, to a broker's commission, finder's fee, investment
banker's fee or similar payment from Buyer or the Company with respect to the
negotiations leading up to the execution of this Agreement or the consummation
of the transactions contemplated hereby.

            3.5.4 Title to Class B Units. Such Executive has good and marketable
title to the number of Class B Units set forth next to his name as follows:
Linder, 8.358; Cristea, 7.562; and Oswald 3.98. Each of such Executive's Class B
Units is free and clear of all Liens other than certain agreements which will be
terminated on or before the Closing Date. Such Executive is not a party to any
voting trust, proxy or other agreement or understanding with respect to the
voting of any of his membership interests in the Company.

                                       36


            3.5.5 Pending Proceedings.

                  (A)   No actions, suits, arbitrations, mediations or other
                        legal proceedings by any Third Party, and no
                        administrative proceedings or governmental
                        investigations, in each instance, are pending or, to the
                        actual knowledge of such Executive is threatened,
                        against or affecting such Executive which reasonably
                        could be expected to impact such Executive's ability to
                        consummate the transactions contemplated by this
                        Agreement.

                  (B)   No bankruptcy or insolvency proceeding of any character,
                        including receivership, reorganization, dissolution or
                        arrangement with creditors, voluntary or involuntary,
                        has been filed or initiated with respect to such
                        Executive.

            3.5.6 Full Disclosure. To the actual knowledge of such Executive, no
representation or warranty by such Executive in this Agreement and no statement
contained in any document, certificate or other writing furnished or to be
furnished by the Executive pursuant to this Agreement contains or will contain
any untrue statement of material fact or omits or will omit to state any
material fact necessary, in light of the circumstances under which it was made,
to make the statements herein or therein not misleading.

            3.5.7 Update of Information. Subject to Section 3.7, each of the
representations made by such Executive in this Section 3.5 shall be deemed made
and given on the Agreement Date and continuously thereafter until the Closing.
During the period from the Agreement Date until the Closing, such Executive
promptly shall give Buyer written notice at such times as such Executive
determines that any representation made in this Section 3.5 would cease to be
correct if such representation were made on such date, contains any untrue
statement of a material fact or omits to state a material fact necessary to make
such representation not misleading. To be effective, each such notice shall (a)
identify, by section reference, the representation as to which the notice
relates, and (b) correctly restate the representation.

      3.6 REPRESENTATIONS AND WARRANTIES OF SMHS. SMHS hereby represents to
Buyer that the following facts and circumstances are true and correct and SMHS
acknowledges that such facts and circumstances constitute a material inducement
for the execution of this Agreement by Buyer:

            3.6.1 Organization and Good Standing. SMHS is a nonprofit
corporation, duly incorporated, validly existing and in good standing under the
laws of the State of Missouri.

            3.6.2 Authority and Enforceability. SMHS has full power and
authority, including full corporate power and authority, to execute, deliver and
perform its respective obligations under this Agreement. The execution, delivery
and performance of this Agreement and all other agreements contemplated by this
Agreement have been duly authorized by SMHS. Assuming the due authorization,
execution and delivery by each other Party, this Agreement constitutes a valid
and legally binding obligation of SMHS, enforceable in accordance with its
respective terms and conditions.

                                       37


            3.6.3 Consents. SMHS is not required to give any notice to, make any
filing with or obtain any authorization, consent or approval of any Governmental
Entity in order to consummate the transactions contemplated by this Agreement
other than as may be required of SMHS (a) under the HSR Act, and (b) to obtain
any required approval or consent from, or make any disclosure to, DOI or the
State Agency.

            3.6.4 Non-Contravention. Neither the execution and the delivery of
this Agreement nor the consummation of the transactions contemplated by this
Agreement will (a) violate any constitution, statute, regulation, rule, License,
injunction, judgment, order, decree, ruling, charge or other restriction of any
Governmental Entity to which SMHS is subject or any provision of its articles of
incorporation, bylaws or other governing documents, or (b) conflict with, result
in a breach of, constitute a default under, result in the acceleration of,
create in any Person the right to accelerate (whether after the giving of notice
or lapse of time or both), terminate, modify or cancel, or require any notice
under any Contract, lease or License to which SMHS is a party, by which it is
bound or to which any of its assets is subject other than those breaches,
defaults, violations or conflicts which have not had, and would not reasonably
be likely to have, individually or in the aggregate, a Material Adverse Effect
on SMHS.

            3.6.5 Brokers. Neither SMHS nor any Person acting on SMHS' behalf
has retained or dealt with any Person who is entitled, directly or indirectly,
to a broker's commission, finder's fee, investment banker's fee or similar
payment from Buyer or the Company with respect to the negotiations leading up to
the execution of this Agreement or the consummation of the transactions
contemplated hereby.

            3.6.6 Title to Class C Units. SMHS has good and marketable title to
100 Class C Units and such Class C Units are free and clear of all Liens other
than certain agreements which will be terminated on or before the Closing Date.
SMHS is not a party to any voting trust, proxy or other agreement or
understanding with respect to the voting of any of its membership interests in
the Company.

            3.6.7 Pending Proceedings.

                  (A)   No actions, suits, arbitrations, mediations or other
                        legal proceedings by any Third Party, and no
                        administrative proceedings or governmental
                        investigations, in each instance, are pending or, to the
                        Knowledge of SMHS is threatened, against or affecting
                        SMHS which reasonably could be expected to impact SMHS'
                        ability to consummate the transactions contemplated by
                        this Agreement.

                  (B)   No bankruptcy or insolvency proceeding of any character,
                        including receivership, reorganization, dissolution or
                        arrangement with creditors, voluntary or involuntary,
                        has been filed or initiated with respect to SMHS.

                                       38


            3.6.8 Full Disclosure. To the Knowledge of SMHS, no representation
or warranty by SMHS in this Agreement and no statement contained in any
document, certificate or other writing furnished or to be furnished by SMHS to
Buyer pursuant to this Agreement contains or will contain any untrue statement
of material fact or omits or will omit to state any material fact necessary, in
light of the circumstances under which it was made, to make the statements
herein or therein not misleading.

            3.6.9 Update of Information. Each of the representations made by
SMHS in this Section 3.6 shall be deemed made and given on the Agreement Date
and continuously thereafter until the Closing. During the period from the
Agreement Date until the Closing, SMHS promptly shall give Buyer written notice
at such times as SMHS determines that any representation made in this Section
3.6 would cease to be correct if such representation were made on such date,
contains any untrue statement of a material fact or omits to state a material
fact necessary to make such representation not misleading. To be effective, each
such notice shall (a) identify, by section reference, the representation as to
which the notice relates, (b) correctly restate the representation, and (c) if
applicable, be accompanied by an amendment to any Section of the Disclosure
Schedule which identifies the exception(s) to the representation.

      3.7 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Parties made in this Agreement shall survive the Closing for a
period of 18 months following the Closing except that the representations and
warranties set forth in (a) Section 3.4.14 shall survive the Closing until the
expiration of the applicable statute of limitations (taking into account all
extensions thereof), and (b) Sections 3.2.1, 3.2.2, 3.2.4, 3.2.9, 3.3.1, 3.3.2,
3.3.4, 3.3.5, 3.3.6, 3.4.1, 3.4.2, 3.4.4, 3.4.5, 3.4.9, 3.5.1, 3.5.2, 3.5.3,
3.5.4, 3.6.1, 3.6.2, 3.6.4, 3.6.5 and 3.6.6 shall survive the Closing for a
period of 24 months following the Closing, except that, in the case of fraud,
such representations and warranties shall survive indefinitely.

                                   ARTICLE IV
                         CONDUCT PRIOR TO EFFECTIVE TIME

      4.1 OBLIGATIONS OF THE COMPANY.

            4.1.1 Conduct of Business. During the period from the Agreement Date
until the earlier of the Closing and termination of this Agreement pursuant to
its terms, except as may be expressly contemplated by this Agreement (including
with respect to the Forgiveness and the Gross-Up Payments), set forth in Section
4.1 of the Disclosure Schedule or consented to in writing by Buyer, the Company
shall:

                  (A)   Continue the Ordinary Course of Business;

                  (B)   Use commercially reasonable efforts to maintain and
                        preserve intact the Business and maintain the ordinary
                        and customary relationships of the Company with its
                        Providers, Enrollees, Employees and suppliers;

                                       39


                  (C)   Not amend the Company Articles, the Operating Agreement
                        or any other organizational or governing document of the
                        Company;

                  (D)   Not issue any equity or ownership interests or other
                        securities convertible or exchangeable into equity or
                        ownership interests in the Company or any options,
                        warrants or other rights to purchase any such equity or
                        ownership interests or any securities convertible into
                        or exchangeable for such equity or other ownership
                        interests;

                  (E)   Not recognize, approve or participate in the sale,
                        transfer, pledge, disposition or other encumbrance of
                        any of the Units or any other securities or equity or
                        ownership interests in the Company;

                  (F)   Not declare, set aside or pay any distribution with
                        respect to any of the Units or any other securities or
                        equity or ownership interests in the Company;

                  (G)   Not repurchase, redeem or otherwise acquire directly or
                        indirectly any of the Units or any other securities or
                        equity or ownership interests in the Company;

                  (H)   Except as provided in the Executive Employment
                        Agreements, not (i) make any change in the compensation
                        or benefits payable or to become payable to any Employee
                        other than general increases in salary or wages to
                        Employees in the Ordinary Course of Business, or (ii)
                        adopt any new or amend any existing Benefit Plan;

                  (I)   Not change in any material respect any of the accounting
                        methods used with respect to the Business unless
                        required by GAAP or SAP, including the methodology used
                        to calculate IBNR;

                  (J)   Not transfer, sell, lease, license, mortgage, pledge,
                        grant any security interest in, create any Lien, other
                        than Permitted Liens, upon or otherwise dispose of any
                        of the assets or properties of the Business other than
                        in the Ordinary Course of Business;

                  (K)   Not sell, transfer, pledge, modify, disclose, dispose
                        of, abandon or permit to lapse any right under or
                        respecting, or enter into any settlement regarding the
                        breach or infringement of, any Intellectual Property
                        used in the Business;

                  (L)   Not (i) make any loans, advances or capital
                        contributions to, or investments in, any Person, or (ii)
                        incur, assume or guarantee any indebtedness for borrowed
                        money other than in the Ordinary Course of Business;

                                       40


                  (M)   Not purchase or otherwise acquire any material assets on
                        behalf of the Company or make commitments therefor
                        involving the expenditure of more than $50,000
                        individually and $75,000 in the aggregate per calendar
                        month;

                  (N)   Not merge or consolidate with, purchase all or any
                        substantial part of the assets of, or otherwise acquire,
                        any Person;

                  (O)   Other than in the Ordinary Course of Business, not (i)
                        enter into any material Contract with respect to the
                        Business (ii) modify in any material respect, amend in
                        any material respect or terminate any Designated
                        Contract.

                  (P)   Not enter into any Contract with respect to the Business
                        which imposes non-competition, non-solicitation,
                        exclusive dealing or other similar obligations or
                        limitations on the Company;

                  (Q)   Not enter into any Contract with CH, any of CH's
                        Affiliates, SMHS or any of SMHS' Affiliates except that,
                        with respect to the Affiliates of SMHS, Provider
                        Agreements which have been approved by DOI shall be
                        permitted;

                  (R)   Not (i) commence any lawsuit other than for the routine
                        collection of accounts receivable, or (ii) settle or
                        compromise any litigation with respect to the Business
                        or waive, release or assign any material rights or
                        Claims with respect to the Business;

                  (S)   Not (i) settle or compromise any Tax liability, (ii)
                        agree to any adjustment of any Tax attribute, (iii)
                        make, change or revoke any election with respect to
                        Taxes, (iv) surrender any right to claim, or file a
                        Claim for, a refund of Taxes, (v) consent to any
                        extension or waiver of the statute of limitations period
                        applicable to any Taxes or Tax Return, (vi) amend any
                        Tax Return, (vii) enter into any closing or other
                        agreement with respect to Taxes, (viii) grant any power
                        of attorney with respect to Taxes, or (ix) except
                        insofar as may be required by a change in GAAP, SAP or
                        applicable Law, change accounting methods, principles or
                        practices for Tax or accounting purposes;

                  (T)   Not modify in any material respect the amount or timing
                        of (i) any payments under the Medicaid Contracts, or
                        (ii) other than in the Ordinary Course of Business,
                        payments, discounts or other allowances from or to
                        Providers and vendors for goods and services provided to
                        the Company;

                  (U)   Not fail to maintain or renew any Licenses;

                                       41


                  (V)   Not reduce the amount of any insurance coverages
                        identified in Sections 3.4.28 and 3.4.29 of the
                        Disclosure Schedule or fail to renew any such insurance
                        policies; and

                  (W)   Use commercially reasonable best efforts to refrain from
                        taking (or failing to take) any other action which will
                        result, or reasonably could be expected to result, in
                        the failure to satisfy any of the conditions set forth
                        in Section 5.3.

            4.1.2 Full Access. During the period from the Agreement Date through
the Closing Date, the Company shall permit Representatives of Buyer to have full
access at all reasonable times, and in a manner so as not to interfere with the
normal business operations of the Company, to all premises, properties,
personnel, books, records, Tax Returns, Contracts and documents of or pertaining
to the Company or the Business. Any information obtained by Buyer pursuant to
the access accorded under this Section 4.1.2 shall be held by Buyer subject to
the provisions of the Confidentiality Agreement.

      4.2 STANDSTILL. During the period from the Agreement Date until the
earlier of the Closing and the termination of this Agreement pursuant to its
terms:

            4.2.1 The Company shall not sell, transfer, lease, convey or
otherwise dispose of all or substantially all of its assets;

            4.2.2 CH shall not sell, transfer, convey or otherwise dispose of
any Class A Unit;

            4.2.3 No Executive shall sell, transfer, convey or otherwise dispose
of any Class B Unit;

            4.2.4 SMHS shall not sell, transfer, convey or otherwise dispose of
any Class C Unit;

            4.2.5 The Company shall cause its officers, Employees, managers and
agents not to solicit, initiate or encourage the initiation of inquiries or
proposals from, provide any Confidential Information to or participate in any
discussions or negotiations or cooperate with any Person (other than Buyer, its
Affiliates and their respective Representatives) which could involve, directly
or indirectly, any sale, transfer, lease, conveyance or other disposition by (a)
the Company of all or substantially all of its assets, or (b) Sellers of any
Unit;

            4.2.6 CH and SMHS shall cause each of their respective officers,
employees, members and agents not to solicit, initiate or encourage the
initiation of inquiries or proposals from, provide any Confidential Information
to or participate in any discussions or negotiations or cooperate with any
Person (other than Buyer, its Affiliates and their respective Representatives)
which could involve, directly or indirectly, any sale, transfer, lease,
conveyance or other disposition by (a) the Company of all or substantially all
of its assets, or (b) Sellers of any Unit; and

                                       42


            4.2.7 No Executive shall solicit, initiate or encourage the
initiation of inquiries or proposals from, provide any Confidential Information
to or participate in any discussions or negotiations or cooperate with any
Person (other than Buyer, its Affiliates and their respective Representatives)
which could involve, directly or indirectly, any sale, transfer, lease,
conveyance or other disposition by (a) the Company of all or substantially all
of its assets, or (b) Sellers of any Unit.

      4.3 JOINT OBLIGATIONS.

            4.3.1 Best Efforts. During the period from the Agreement Date until
the earlier of the Closing and termination of this Agreement pursuant to its
terms, each Party shall use its best efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, all things reasonably necessary,
desirable or appropriate, including under applicable Laws, to fulfill its
obligations under this Agreement and to make effective the transactions
contemplated by this Agreement.

            4.3.2 Governmental Approvals/Consents.

                  (A)   Promptly following the Agreement Date, Sellers and Buyer
                        shall file with the Federal Trade Commission and the
                        Department of Justice the notification required to be
                        filed with respect to the transactions contemplated by
                        this Agreement under the HSR Act. Buyer shall pay the
                        filing fees associated with the filing of such
                        notification under the HSR Act. Each Party shall respond
                        promptly to any requests for additional information made
                        by such agencies and shall cooperate with the other
                        Parties in making such filings and in responding to such
                        information requests.

                  (B)   Promptly following the Agreement Date, Buyer shall file
                        such documents as are necessary to obtain the approval
                        of the DOI to the transactions contemplated by this
                        Agreement. Each Party shall respond promptly to any
                        requests for additional information made by the DOI and
                        shall cooperate with Buyer in making such filings and in
                        responding to such information requests.

                  (C)   Promptly following the Agreement Date, the Company shall
                        apprise the State Agency of the execution of this
                        Agreement and shall file such documents as are necessary
                        to obtain any consent from, or make any disclosures to,
                        the State Agency regarding the transactions contemplated
                        by this Agreement.

                  (D)   With respect to the obligations of the Parties in
                        Sections 4.3.2(a), 4.3.2(b) and 4.3.2(c), each of them
                        respectively shall (i) promptly notify the other Parties
                        of any written communication received from any
                        Governmental Entity, (ii) if practicable, permit the
                        other's respective counsel to review in advance any
                        proposed

                                       43




                        written communication to any such Governmental Entity
                        and incorporate the reasonable comments of such counsel,
                        (iii) not participate in any substantive meetings or
                        discussions with any such Governmental Entity in respect
                        of any filing, investigation or inquiry concerning this
                        Agreement or the transactions contemplated hereby in
                        advance, (iv) to the extent permitted by such in
                        advance, (iv) to the extent permitted by such
                        Governmental Entity, give the other Parties the
                        opportunity to participate in any such meetings or
                        discussions, and (v) furnish the other Parties'
                        respective counsel with copies of all correspondence,
                        filings and written communications to or from any such
                        Governmental Entity.

      4.4 OBLIGATIONS RELATING TO EXECUTIVE EMPLOYMENT AGREEMENTS.

            4.4.1 Buyer, SMHS, CH and the Company acknowledge the existence and
enforceability of each Executive Employment Agreement, including the obligations
of the Company therein with respect to the Forgiveness and the Gross-Up Payment.

            4.4.2 Prior to the Closing, CH shall (a) contribute the Promissory
Notes to the Company as a "Capital Contribution," as defined in the Operating
Agreement (without the Company making any payment therefor), and (b) assign the
Pledge Agreements to the Company.

            4.4.3 CH hereby represents and warrants that, at the time of such
contribution and assignment, (a) CH will be the holder of the Promissory Notes
free and clear of all Liens, (b) no payments of principal under the respective
Promissory Notes will have been made by any Executive, (c) all interest due and
payable under the respective Promissory Notes will have been paid by each
respective Executive, and (d) CH will be the "Secured Party" under the Pledge
Agreements.

            4.4.4 Prior to the Closing, the Company shall (a) implement the
Forgiveness, (b) make a Gross-Up Payment to each Executive, respectively,
provided such Executive has supplied the Company with a calculation of the
Gross-Up Payment applicable to him and such calculation is deemed acceptable to
the Company, and (c) release the collateral pledged by each Executive under the
respective Pledge Agreement.

            4.4.5 Each Executive hereby represents and warrants that (a) as of
the Agreement Date, (i) the Promissory Note executed by him constitutes a valid
and enforceable obligation of such Executive pursuant to the terms of such
Promissory Note, (ii) he has made no payments of principal under such Promissory
Note, (iii) all interest payments due and payable under such Promissory Note
have been paid, and (iv) the Pledge Agreement executed by him constitutes a
valid and enforceable obligation of such Executive pursuant to the terms of such
Pledge Agreement, and (b) implementation of the Forgiveness and payment of the
Gross-Up Payment shall satisfy all of the obligations of the Company under his
Executive Employment Agreement with respect to the Forgiveness and the Gross-Up
Payment.

                                       44


            4.4.6 SMHS and CH, as the collective owners of all the Units other
than the Class B Units, hereby ratify and confirm the Forgiveness and the
Gross-Up Payment with respect to each Executive.

            4.4.7 CH hereby represents and warrants that, prior to the
Forgiveness and the Gross-Up Payment with respect to each Executive, CH will
have (a) notified the owners of all of the membership interests held in CH of
each Forgiveness and Gross-Up Payment, and (b) obtained the consent of such
owners to each Forgiveness and Gross-Up Payment.

                                    ARTICLE V
                              CONDITIONS TO CLOSING

      5.1 CONDITIONS TO BUYER'S OBLIGATIONS. Buyer's obligation to consummate
the transactions to be performed by it in connection with the Closing is subject
to satisfaction of each of the following conditions or the waiver thereof in
writing by Buyer prior to the Closing:

            5.1.1 Receipt by Buyer of all deliverables required from the
Company, CH, the Executives and SMHS in Article I;

            5.1.2 No injunction, judgment, order, decree, ruling or charge shall
be in effect which prevents the Closing;

            5.1.3 The requisite waiting period, if any, under the HSR Act shall
have expired or terminated;

            5.1.4 The St. John's Mercy Provider Agreement shall have been fully
executed by the parties thereto.

            5.1.5 The License Agreement shall have been fully executed by the
parties thereto.

            5.1.6 The DOI shall have approved the transactions contemplated by
this Agreement;

            5.1.7 Any required consent from or disclosure to the State Agency
shall have been received or made; and

            5.1.8 The Company shall have (a) no trade payables outstanding in
excess of 30 days as of the Effective Time, (b) cash, cash equivalents, accounts
receivable and other current assets net of reasonable reserves which exceed the
Company's pre-Closing current liabilities, including IBNR, as of the Effective
Time, and (c) Capital and Surplus equal to 300% of RBC as set forth on the Pro
Forma RBC Calculation.

      5.2 CONDITIONS TO CH'S OBLIGATIONS. CH's obligation to consummate the
transactions to be performed by it in connection with the Closing is subject to
satisfaction of each of the following conditions or the waiver thereof in
writing by CH prior to the Closing:

                                       45


            5.2.1 Receipt by CH of all deliverables required from Buyer under
Section 1.9;

            5.2.2 No injunction, judgment, order, decree, ruling or charge shall
be in effect which prevents the Closing;

            5.2.3 The requisite waiting period, if any, under the HSR Act shall
have expired or terminated;

            5.2.4 The DOI shall have approved the transactions contemplated by
this Agreement; and

            5.2.5 Any required consent from or disclosure to the State Agency
shall have been received or made.

      5.3 CONDITIONS TO THE COMPANY'S OBLIGATIONS. The Company's obligation to
consummate the transactions to be performed by it in connection with the Closing
is subject to satisfaction of each of the following conditions or the waiver
thereof in writing by the Company prior to the Closing:

            5.3.1 No injunction, judgment, order, decree, ruling or charge shall
be in effect which prevents the Closing;

            5.3.2 The requisite waiting period, if any, under the HSR Act shall
have expired or terminated;

            5.3.3 The DOI shall have approved the transactions contemplated by
this Agreement; and

            5.3.4 Any required consent from or disclosure to the State Agency
shall have been received or made.

      5.4 CONDITIONS TO EACH EXECUTIVE'S OBLIGATIONS. Each Executive's
obligation to consummate the transactions to be performed by him in connection
with the Closing is subject to satisfaction of each of the following conditions
or the waiver thereof in writing by such Executive prior to the Closing:

            5.4.1 Receipt by such Executive of all deliverables required from
Buyer under Section 1.9;

            5.4.2 No injunction, judgment, order, decree, ruling or charge shall
be in effect which prevents the Closing;

            5.4.3 The requisite waiting period, if any, under the HSR Act shall
have expired or terminated;

            5.4.4 The DOI shall have approved the transactions contemplated by
this Agreement;

                                       46


            5.4.5 Any required consent from or disclosure to the State Agency
shall have been received or made;

            5.4.6 The Company shall have confirmed in writing the satisfaction
of its obligations under such Executive's Executive Employment Agreement upon
the termination of such Executive's Executive Employment Agreement by reason of
a Capital Event; and

            5.4.7 Documentation reflecting that a mutually acceptable New
Executive Employment Arrangement has been reached between the Company and such
Executive (or an indication by the Company and an Executive that such
arrangement has not been reached).

      5.5 CONDITIONS TO SMHS' OBLIGATIONS. SMHS' obligation to consummate the
transactions to be performed by it in connection with the Closing is subject to
satisfaction of each of the following conditions or the waiver thereof in
writing by SMHS prior to the Closing:

            5.5.1 Receipt by SMHS of all deliverables required from Buyer under
Section 1.9;

            5.5.2 No injunction, judgment, order, decree, ruling or charge shall
be in effect which prevents the Closing;

            5.5.3 The requisite waiting period, if any, under the HSR Act shall
have expired or terminated;

            5.5.4 The DOI shall have approved the transactions contemplated by
this Agreement; and

            5.5.5 Any required consent from or disclosure to the State Agency
shall have been received or made.

                                   ARTICLE VI
                             POST-CLOSING COVENANTS

      6.1 EXECUTION OF DOCUMENTS. In the event any further action is necessary
or desirable to carry out the purposes of this Agreement following the Closing
Date, each Party shall take such further action, including the execution and
delivery of such further instruments and documents, as the other Party
reasonably may request, all at the sole cost and expense of the requesting Party
unless the requesting Party is entitled to indemnification for such action under
this Agreement.

      6.2 COVENANT NOT TO COMPETE/NON-SOLICITATION.

            6.2.1 Competitive Activities. During the Non-Compete Period, SMHS
and CH shall not, and each of SMHS and CH shall cause its respective Affiliates
not to, own any equity interest in, operate, manage or control any Person (other
than the Company) which owns any equity interest in, operates, manages or
controls any venture or enterprise which engages or proposes to engage, within
the Territory, in a Competitive Business unless the Company

                                       47


otherwise consents in writing thereto (which consent the Company may grant or
withhold in its sole discretion); provided, however, nothing contained herein
shall prevent any Seller or any Affiliate of a Seller from, during the
Non-Compete Period (and thereafter), (a) making any Permitted Investment, (b)
providing health care services to a competitor of the Company, or (c) acquiring
all or substantially all of the assets or ownership interests of a wholly
unrelated entity in which a minority of such entity's total business operations
includes engaging in a Competitive Business within the Territory so long as such
Seller or such Affiliate divests, or causes to be divested, that portion of such
acquired entity's business operations which includes engaging in a Competitive
Business within 6 months of such acquisition if at least 6 months remain in the
Non-Compete Period.

            6.2.2 Non-Solicitation. Subject to Section 6.2.4, during the
one-year period following the Closing Date:

                  (A)   No Seller shall, and each Seller shall cause its
                        Affiliates not to, directly or indirectly, solicit for
                        employment or engagement as an independent contractor
                        any Employee, any Person who was an employee of the
                        Company within the 120-day period prior to the Closing
                        Date or any employee of Buyer or any of its Affiliates,
                        provided, however, nothing in this Section 6.2.2(a)
                        shall prevent a Seller or any Affiliate of a Seller from
                        (i) soliciting any Person for employment or engagement
                        as an independent contractor by means of general
                        solicitation, including public advertisements or general
                        postings, or (ii) offering employment or engagement as
                        an independent contractor to any Person who initiates
                        the contact for employment or engagement as an
                        independent contractor.

                  (B)   Buyer shall not, and Buyer shall cause its Affiliates
                        not to, directly or indirectly, solicit for employment
                        or engagement as an independent contractor any employee
                        of CH, SMHS or any of their respective Affiliates,
                        provided, however, nothing in this Section 6.2.2(b)
                        shall prevent Buyer or any Affiliate of Buyer from (i)
                        soliciting any Person for employment or engagement as an
                        independent contractor by means of general solicitation,
                        including public advertisements or general postings, or
                        (ii) offering employment or engagement as an independent
                        contractor to any Person who initiates the contact for
                        employment or engagement as an independent contractor.

            6.2.3 Judicial Modification. If any court of competent jurisdiction
shall at any time determine that the Non-Compete Period is too lengthy, any
particular covenant in this Section 6.2 is too restrictive or the Territory is
too extensive, the other provisions of this Article VI shall nevertheless remain
in effect. Upon such determination(s), the Non-Compete Period shall be deemed to
be the longest period permissible by Law under the circumstances, the covenants
herein shall be deemed to be the most restrictive permissible by Law under the
circumstances and the Territory shall be deemed to comprise the largest
territory permissible by Law under the circumstances. This Agreement shall be
modified to incorporate the final determination(s) made in each case the court
makes such determination(s).

                                       48


            6.2.4 Executives. Notwithstanding any of the foregoing provisions of
this Section 6.2, if an Executive (a) accepts employment with the Company
following the Closing, his obligations with respect to non-competition with the
Company and non-solicitation of employees shall be governed by his post-Closing
employment arrangements with the Company, provided that in no event shall
Executive hold an equity ownership in a Competitive Business with operations in
the Territory for 12 months following the Closing, or (b) does not accept
employment with the Company following the Closing, he shall (i) be bound by the
non-solicitation provisions set forth in Section 6.2.2, and (ii) not be bound by
any non-competition provisions except that he shall be precluded from holding an
equity ownership in a Competitive Business with operations in the Territory for
12 months following the Closing.

            6.2.5 Acknowledgement. Notwithstanding the provisions of Section
6.2.1, Buyer and Company acknowledge that (a) SMHS operates a large Catholic
health care system comprised of Affiliated and non-affiliated hospitals,
physicians and other health care providers, and (b) nothing contained in Section
6.2.1 is intended to preclude SMHS or any such hospitals, physicians and other
health care providers from continuing to engage in, or commencing the engagement
of, any health care-related activities other than the ownership, operation,
management or control of a Competitive Business within the Territory.

      6.3 CONFIDENTIALITY. From and after the Closing, each Seller shall, and
each of CH and SMHS shall cause its respective officers, managers, directors and
advisors to, keep confidential any and all Confidential Information.
Notwithstanding the foregoing, nothing herein shall prohibit any Seller from
disclosing any Confidential Information required to respond to an order by a
Governmental Entity or as otherwise required by Law. In the event such an
authorized disclosure is required, the disclosing Person shall inform Buyer in
writing of such request or obligation as soon as practicable after the
disclosing Person is informed or becomes aware of such request or obligation. In
the event Buyer obtains a protective order or other appropriate remedy with
respect to the disclosure, the disclosing Person shall be bound thereby. In any
event, the disclosing Person shall only make such disclosure to the extent to
which he or it is obligated and shall seek to obtain appropriate assurances that
such disclosure will be accorded confidential treatment.

      6.4 BOOKS AND RECORDS.

            6.4.1 Retention of Books and Records. Following the Closing Date,
the Company shall retain (a) for the greater of (i) five years, and (ii) the
period required by applicable Laws, all medical and financial records relating
to medical services provided to Enrollees, including for examination and audit
by the State Agency and other authorized Governmental Entities, (b) until the
applicable Tax statutes of limitation (including periods of waiver) have
expired, all books, records and other documents required to support or document
information contained on Tax Returns filed prior to the Closing Date or covering
the period ending on the Closing Date, and (c) until the period a Claim can be
asserted under Article VII, all books, records and other documents required to
support or document the assertion or defense of any such Claim.

                                       49


            6.4.2 Access to Books and Records. Following the Closing Date, the
Company shall provide reasonable access to Sellers and their respective
Representatives to permit Sellers to obtain information relevant to Sellers
regarding the Company. Such access shall be provided during normal business
hours and Sellers shall be entitled to make copies of such books, records and
documents at their respective expense. Sellers shall provide the Company with
reasonable advance written notice of a request for access and any requested
review shall be conducted in a manner which is not disruptive to the Business.

      6.5 TAX MATTERS.

            6.5.1 Allocation of Company Taxes. Subject to the provisions of this
Section 6.5, Sellers shall pay all Taxes of the Company for all taxable periods
(or portions thereof) ending on or prior to the Closing Date to the extent such
Taxes exceed the amount, if any, (i) of the reserve for Tax liability (excluding
any reserve for deferred Taxes established to reflect timing discrepancies
between book and Tax income) reflected in the Final RBC Calculation, or (ii)
paid by the Company or Sellers on or prior to the Closing Date on account of
such Taxes. Buyer will pay for all Taxes of the Company for all taxable periods
(or portions thereof) beginning after the Closing Date.

            6.5.2 Tax Returns for Periods Ending on or Prior to Closing Date,
Filed Prior to the Closing Date. During the period between the Agreement Date
and the Closing Date, the Company shall (a) prepare and file, or cause to be
filed, on a timely basis and consistent with past practice, all Tax Returns
required to be filed by the Company (taking extensions into account) prior to
the Closing Date, and (b) timely (taking extensions into account) pay all Taxes
shown thereon as required to be paid.

            6.5.3 Tax Returns for Periods Ending on or Prior to Closing Date,
Filed After the Closing Date.

                  (A)   As promptly as practicable following the Closing Date,
                        the Company, under the direction of Sellers, shall
                        prepare or cause to be prepared, at Sellers' expense,
                        all Reviewable Returns in accordance with the Company's
                        past practice.

                  (B)   The Company shall provide Buyer with copies of all
                        Reviewable Returns at least 30 days prior to the
                        respective due dates of each Reviewable Return (taking
                        into account any extensions).

                  (C)   Unless Buyer, within ten Business Days after receipt of
                        any Reviewable Return, gives Sellers a written notice
                        objecting thereto which specifies the basis for such
                        objection and the amount in dispute, the Reviewable
                        Return shall be (i) deemed final and binding upon the
                        Parties, and (ii) promptly filed with the appropriate
                        Tax authority.

                                       50


                  (D)   If, within such ten-Business Day period, Buyer gives
                        Sellers a written notice of objection to any Reviewable
                        Return which specifies the basis for such objection and
                        the amount in dispute, and any dispute involving such
                        objection or amount is not resolved by the Parties
                        within four days following receipt by Sellers of such
                        notice, the dispute shall be resolved by negotiation or
                        submission to an independent certified public accountant
                        selected in a manner consistent with the procedures set
                        forth in Section 2.2.7.

                  (E)   If the dispute is resolved amicably by negotiation, the
                        Reviewable Return in dispute shall be (i) modified to
                        reflect such resolution, (ii) deemed final and binding
                        upon the Parties, and (iii) promptly filed with the
                        appropriate Tax authority.

                  (F)   If the dispute is resolved following submission to an
                        independent accountant, the Reviewable Return in dispute
                        shall be (i) modified to reflect the determination of
                        such independent certified public accountant, (ii)
                        deemed final and binding upon the Parties, and (iii)
                        promptly filed with the appropriate Tax authority.

                  (G)   Within five Business Days after a Reviewable Return
                        becomes final and binding upon the Parties, (i) Sellers
                        shall pay to the Company any Tax liability shown thereon
                        after crediting any Tax payments made by the Company on
                        or prior to the Closing Date on account of any such Tax
                        liability covered by such Reviewable Return and any
                        accrual therefor appearing on the Final RBC Calculation,
                        or (ii) Buyer shall pay to Sellers (using the Standard
                        Allocation) the amount of any Tax refund shown as
                        receivable on such Reviewable Return after crediting any
                        Tax refund asset with respect thereto appearing on the
                        Final RBC Calculation.

                  (H)   In the event the Parties have not fully resolved any
                        dispute with respect to any Tax items on or prior to the
                        due date of a Reviewable Return, the Company shall
                        obtain an extension for the filing of such Reviewable
                        Return.

            6.5.4 Tax Periods Beginning Before and Ending After the Closing
Date.

                  (A)   Following the Closing Date, the Company shall prepare or
                        cause to be prepared, at the Company's expense, all Tax
                        Returns ("Straddle Period Returns") for the Company with
                        respect to taxable periods

                                       51


                        of the Company which begin before and end after the
                        Closing Date ("Straddle Tax Periods") in accordance with
                         the Company's past practice.

                  (B)   At least 30 days prior to the respective due dates of
                        each Straddle Period Return (taking into account any
                        extensions), the Company shall provide Sellers with (i)
                        a copy of the respective Straddle Period Return, and
                        (ii) a calculation ("Stub Period Calculation") of the
                        Tax liability or net operating loss attributable to the
                        portion of the Straddle Tax Period ending on the Closing
                        Date ("Stub Period") determined in accordance with
                        Section 6.5.5.

                  (C)   Unless Sellers, within ten Business Days after receipt
                        of any Straddle Period Return and related Stub Period
                        Calculation, give the Company a written notice objecting
                        to the Stub Period Calculation which specifies the basis
                        for such objection and the amount in dispute, the Stub
                        Period Calculation shall be (i) deemed final and binding
                        upon the Parties, and (ii) used in calculating the Tax
                        required to be paid on such Straddle Period Return.

                  (D)   If, within such ten-Business Day period, Sellers give
                        the Company a written notice of objection to the Stub
                        Period Calculation which specifies the basis for such
                        objection and the amount in dispute, and any dispute
                        involving such objection or amount is not resolved by
                        the Parties within four days following receipt by the
                        Company of such notice, the dispute shall be resolved by
                        negotiation or submission to an independent certified
                        public accountant selected in a manner consistent with
                        the procedures set forth in Section 2.2.7; provided,
                        however, nothing herein shall preclude the Company from
                        filing the Straddle Period Return using the Stub Period
                        Calculation pending the resolution of such dispute.

                  (E)   If the dispute is resolved amicably by negotiation, the
                        Stub Period Calculation in dispute shall be (i) modified
                        to reflect such resolution, (ii) deemed final and
                        binding upon the Parties, and (iii) used in calculating
                        (A) the Tax required to be paid on such Straddle Period
                        Return, or (B) an amendment to such Straddle Period
                        Return.

                  (F)   If the dispute is resolved following submission to an
                        independent accountant, the Stub Period Calculation in
                        dispute shall be (i) modified to reflect the
                        determination of such independent accountant, (ii)
                        deemed final and binding upon the Parties, and (iii)
                        used in calculating (A) the Tax required to be paid on
                        such Straddle Period Return, or (B) an amendment to such
                        Straddle Period Return.

                                       52


                  (G)   Within five Business Days after a Stub Period
                        Calculation becomes final and binding upon the Parties,
                        (i) Sellers shall pay to the Company any Tax liability
                        resulting from the use of such Stub Period Calculation
                        and after crediting any Tax payments made by the Company
                        on or prior to the Closing Date on account of any such
                        Tax liability covered by such Straddle Period Return and
                        any accrual therefor appearing on the Final RBC
                        Calculation, or (ii) Buyer shall pay to Sellers (using
                        the Standard Allocation) the amount of any Tax refund
                        resulting from the use of such Stub Period Calculation
                        and after crediting any Tax refund asset with respect
                        thereto appearing on the Final RBC Calculation.

            6.5.5 Allocation of Taxes for Straddle Periods and Tax Periods
Ending on the Closing Date. If any Taxes are imposed on a periodic basis and are
payable for the Straddle Tax Period or for any taxable period ending on the
Closing Date, the Taxes for such period shall be calculated as follows:

                  (A)   Other than with respect to the Taxes identified in
                        Section 6.5.5(b), such Taxes shall be deemed to be the
                        amount of such Taxes for the entire taxable period
                        multiplied by a fraction, the numerator of which is the
                        number of days in the taxable period ending as of the
                        Closing Date, and the denominator of which is the number
                        of days in the entire taxable period; and

                  (B)   Income Taxes of the Company for the taxable period
                        ending on the Closing Date and for the first
                        post-closing taxable period for which Buyer will file a
                        consolidated Tax Return shall be apportioned between the
                        Buyer and the Sellers in accordance with Treasury
                        Regulation Section 1.1502-76(b)(1)(ii) (and similar
                        provisions under state law to the extent available) as
                        reasonably interpreted and applied by the Parties, and
                        no election shall be made under Treasury Regulation
                        Section 1.1502-76(b)(2)(ii) (relating to ratable
                        allocation of a year's items) or any similar provision
                        of state, local or foreign Law. Except as provided in
                        the prior sentence, any Taxes based upon or related to
                        income, gains or receipts (including any Taxes imposed
                        on premiums), employment or sales and use, shall be
                        deemed to be the amount of such Taxes that would be
                        payable if the relevant taxable period ended as of the
                        Closing Date, provided, however, exemptions, allowances
                        or deductions that are calculated on an annual basis
                        shall be prorated between (i) the number of days in the
                        annual period elapsed through the Closing Date, and (ii)
                        the number of days in the annual period elapsing after
                        the Closing Date;

                  (C)   Any credits relating to a Straddle Tax Period shall be
                        taken into account as though the relevant taxable period
                        ended on the Closing Date; and

                                       53


                  (D)   All determinations necessary to give effect to the
                        foregoing allocations shall be made in a manner
                        consistent with past practice of the Company.

            6.5.6 Elections, Amended Returns, Etc. Without the prior written
consent of Sellers, none of Buyer, the Company or any Affiliate of Buyer shall,
with respect to any Tax period (or portion thereof) ending on or before the
Closing Date, (a) make or revoke any election, (b) change the tax treatment of
any item on a Tax Return filed after the Closing Date as compared to the
treatment of such item on a Tax Return filed by the Company prior to the Closing
Date, or (c) file any amended Tax Return or propose or agree to any adjustment
of any item with the IRS or any other taxing authority, in each instance, if
such action would have the effect of increasing the Company's or Sellers'
liability for any Taxes, reducing any Tax benefit of the Company or Sellers,
adversely affecting any Tax refunds referred to in Section 6.5.7 or increasing
the indemnification obligations of Sellers under this Agreement. Without the
prior written consent of Buyer, none of Sellers, the Company, or any Affiliate
of Sellers (or the Company) shall make or revoke any election or otherwise enter
into any new accounting method changes with respect to any Tax period (or
portion thereof) of the Company ending on or after the Closing Date.

            6.5.7 Refunds. Sellers shall be entitled to any refunds of Taxes
relating to taxable periods ending on or before the Closing Date and the portion
of any Straddle Tax Period ending prior to the Closing Date (other than any
refunds arising from carrybacks from periods ending after the Closing Date).
Buyer and the Company, upon the written request of Sellers, shall use reasonable
commercial efforts to obtain any such Tax refunds which are reasonably available
under applicable Law and shall pay to Sellers the amount of any such Tax refunds
within 15 days following receipt thereof. Sellers shall reimburse Buyer and the
Company for all costs in connection with seeking or obtaining a Tax refund for
the benefit of Sellers pursuant to this Section 6.5.7.

            6.5.8 Cooperation on Tax Matters. The Parties shall cooperate fully,
as and to the extent reasonably requested by any Party, in connection with the
filing of all Tax Returns pursuant to this Article VI and any audit, litigation
or other proceeding with respect to Taxes. Such cooperation shall include the
retention and, upon another Party's written request, the provision of records
and information which are reasonably relevant to any such Tax Return filing,
audit, litigation or other proceeding and making employees available on a
mutually convenient basis to provide additional information and explanation of
any material provided hereunder. Buyer and the Company shall assure that all
books and records with respect to Tax matters pertinent to the Company relating
to any taxable period beginning before the Closing Date are retained at least
until the expiration of the statute of limitations (and any extensions thereof)
of such taxable period. Buyer and the Company shall abide by all record
retention agreements entered into with any taxing authority, provided that prior
to destruction of any such books and records, Buyer and the Company shall
provide reasonable written notice to Sellers and an opportunity for Sellers to
take possession of such materials. The Parties shall, upon written request,
provide the other Party(ies) with all information related to the Company that
may be required to be reported by such other Party(ies) pursuant to the Code and
all Treasury Department Regulations promulgated thereunder.

                                       54


            6.5.9 Audit Claims. Any audit, litigation or other proceeding shall
be deemed to be a Claim by a Third Party subject to the procedures set forth in
Section 7.4.

            6.5.10 Transfer Taxes. Buyer and Sellers shall equally share (50% to
Buyer and 50% to Sellers) the cost of any Transfer Taxes, including expense
incurred in preparing and filing any Tax Returns in conjunction therewith.
Sellers shall prepare and timely file any such Tax Returns and Buyer shall
cooperate with Sellers in preparing and filing such Tax Returns. Sellers shall
deliver to Buyer a complete copy of each such Tax Return as filed.

      6.6 CONTINUATION OF D&O INSURANCE. Sellers shall have the right to
purchase at Sellers' expense directors' and officers' liability insurance
covering those individuals who are officers and directors of the Company as of
the Agreement Date for their acts and omissions in their capacity as officers
and directors of the Company prior to the Closing Date. In the event Sellers
elect to purchase such insurance, Company shall, upon receipt of a request from
Sellers, provide to Sellers in a reasonably timely manner any information and
documentation in Company's possession necessary for Sellers to obtain and
maintain such insurance.

      6.7 PAYMENT OF PRE-CLOSING MEDICAL CLAIMS POST-CLOSING. During the period
commencing on the Closing Date and ending on the close of business on the IBNR
Calculation Date, the Company shall, and Buyer shall cause the Company to:

            6.7.1 Process for payment Medical Claims included within IBNR on the
balance sheet prepared in conjunction with the Final RBC Calculation which were
timely submitted to the Company consistent with the respective Provider
Agreements pursuant to which the Company could be obligated to pay such Medical
Claims;

            6.7.2 Pay Medical Claims which comply with Section 6.7.1 to the
extent such Medical Claims are payable in the Ordinary Course of Business; and

            6.7.3 Make payments which comply with Section 6.7.2 only after (a)
submitting such Medical Claim to no less scrutiny than would have been exercised
by the Company under its past practices, (b) contesting Provider submissions
consistent with the Company's past practices, and (c) not waiving any untimely
filing of a Medical Claim.

      6.8 USE OF "MERCY CAREPLUS" NAME.

            6.8.1 At the Closing, the Sublicense Agreement shall automatically
terminate.

            6.8.2 Upon the Closing, Buyer shall be entitled to use the name
"Mercy CarePlus" pursuant to the terms of the License Agreement.

            6.8.3 Upon expiration of the term of the License Agreement, Buyer
shall (a) not use and shall not be entitled to use the name "Mercy CarePlus" or
any other name deceptively similar to such name, and (b) cease use of the name
"Mercy CarePlus" as a trademark or business name in all respects, including (i)
in connection with the Business, (ii) in advertising and promotional materials,
(iii) on internet web sites, (iv) in e-mail, (v) on letterhead and business
cards, (vi) in contracts and other business documents, (vii) in phone greetings,
(viii) in communications with Enrollees, and (ix) in communications with the
State Agency and/or DOI.

                                       55


                                   ARTICLE VII
                                 INDEMNIFICATION

      7.1 INDEMNIFICATION BY SELLERS.

            7.1.1 Subject to Section 7.5, from and after the Closing Date, CH
shall defend, indemnify and hold Buyer, its Affiliates and their respective
officers, directors, agents and employees harmless from and against any and all
Claims to the extent such Claims arise from or are related to (a) subject to
Section 3.7, a breach by CH of any representation or warranty of CH in this
Agreement, (b) any failure by CH to perform or comply with any of the
obligations of CH in this Agreement other than with respect to a breach by CH of
any representation or warranty of CH in this Agreement, (c) any failure of the
Company to perform or comply with any of its obligations under this Agreement
which are to be performed or complied with prior to the Closing Date, and (d)
Pre-Closing Liabilities.

            7.1.2 Subject to Section 7.5, from and after the Closing Date,
Linder shall defend, indemnify and hold Buyer, its Affiliates and their
respective officers, directors, agents and employees harmless from and against
any and all Claims to the extent such Claims arise from or are related to (a)
subject to Section 3.7, a breach by him of a representation or warranty made by
him in this Agreement, (b) any failure by him to perform or comply with any of
the obligations imposed upon him in this Agreement other than with respect to a
breach by him of a representation or warranty made by him in this Agreement, (c)
any failure of the Company to perform or comply with any of its obligations
under this Agreement which are to be performed or complied with prior to the
Closing Date, and (d) Pre-Closing Liabilities.

            7.1.3 Subject to Section 7.5, from and after the Closing Date,
Cristea shall defend, indemnify and hold Buyer, its Affiliates and their
respective officers, directors, agents and employees harmless from and against
any and all Claims to the extent such Claims arise from or are related to (a)
subject to Section 3.7, a breach by him of a representation or warranty made by
him in this Agreement, (b) any failure by him to perform or comply with any of
the obligations imposed upon him in this Agreement other than with respect to a
breach by him of a representation or warranty made by him in this Agreement, (c)
any failure of the Company to perform or comply with any of its obligations
under this Agreement which are to be performed or complied with prior to the
Closing Date, and (d) Pre-Closing Liabilities.

            7.1.4 Subject to Section 7.5, from and after the Closing Date,
Oswald shall defend, indemnify and hold Buyer, its Affiliates and their
respective officers, directors, agents and employees harmless from and against
any and all Claims to the extent such Claims arise from or are related to (a)
subject to Section 3.7, a breach by him of a representation or warranty made by
him in this Agreement, (b) any failure by him to perform or comply with any of
the obligations imposed upon him in this Agreement other than with respect to a
breach by him of a representation or warranty made by him in this Agreement, (c)
any failure of the Company to perform or comply with any of its obligations
under this Agreement which are to be performed or complied with prior to the
Closing Date, and (d) Pre-Closing Liabilities.

                                       56


            7.1.5 Subject to Section 7.5, from and after the Closing Date, SMHS
shall defend, indemnify and hold Buyer, its Affiliates and their respective
officers, directors, agents and employees harmless from and against any and all
Claims to the extent such Claims arise from or are related to (a) subject to
Section 3.7, a breach by SMHS of any representation or warranty of SMHS in this
Agreement, (b) any failure by SMHS to perform or comply with any of the
obligations of SMHS in this Agreement other than with respect to a breach by
SMHS of any representation or warranty of SMHS in this Agreement, (c) any
failure of the Company to perform or comply with any of its obligations under
this Agreement which are to be performed or complied with prior to the Closing
Date, and (d) Pre-Closing Liabilities.

      7.2 INDEMNIFICATION BY BUYER. Subject to Section 7.5, from and after the
Closing Date, Buyer shall defend, indemnify and hold each of Sellers, the
respective Affiliates of CH and SMHS and the respective officers, directors,
agents and employees of CH, SMHS and their respective Affiliates harmless from
and against any and all Claims to the extent such Claims arise from or are
related to (a) subject to Section 3.7, a breach by Buyer of any representation
or warranty of Buyer in this Agreement, (b) any failure by Buyer to perform or
comply with any of the obligations of Buyer in this Agreement other than a
representation or warranty of Buyer in this Agreement, (c) any failure of the
Company to perform or comply with any of its obligations under this Agreement
which are to be performed or complied with on or following the Closing Date, and
(d) any Post-Closing Liabilities.

      7.3 NOTICE OF CLAIM FOR INDEMNIFICATION. Each Indemnitee shall notify the
indemnifying Party in writing of any Claim which the Indemnitee has determined
has given or could give rise to a Claim for indemnity under this Agreement (such
written notice being hereafter referred to as a "Notice of Claim") promptly
after the Indemnitee has made such a determination. In amplification of the
foregoing:

            7.3.1 A Notice of Claim shall specify in reasonable detail the
nature and estimated amount of any such Claim which the Indemnitee believes does
or could give rise to a right of indemnification hereunder.

            7.3.2 Failure of an Indemnitee timely to give a Notice of Claim
shall not release the indemnifying Party of its indemnity obligations except to
the extent that such failure directly causes or results in additional damages,
losses, liabilities or expenses, in which case the indemnifying Party shall be
released of its indemnity obligations only to the extent of such additional
damages, losses, liabilities or expenses. If the Indemnitee settles or
compromises any such action or Claim prior to giving a Notice of Claim, the
indemnifying Party shall be released of its indemnity obligations to the extent
that the settlement or compromise was not made with the prior written consent of
such indemnifying Party.

      7.4 DEFENSE OF UNDISPUTED CLAIMS. The indemnifying Party shall defend, in
good faith and at its expense, each Claim encompassed by a Notice of Claim which
it does not dispute. The Indemnitee, at its expense, shall have the right, but
not the obligation, to participate in the

                                       57


defense of such Claim, it being understood thereby that settlement of such Claim
shall, to the extent the settlement fully resolves such Claim, relieve the
indemnifying Party from any requirement further to defend such Claim. In
amplification of the foregoing:

            7.4.1 So long as the indemnifying Party is defending in good faith
any such Claim, the Indemnitee shall not settle or compromise the Claim without
the prior written consent of the indemnifying Party.

            7.4.2 The Indemnitee shall make available to the indemnifying Party
and its Representatives all records and other materials reasonably required for
use in defending against or otherwise contesting the Claim and shall cooperate
in good faith with the indemnifying Party; the indemnifying Party shall keep the
Indemnitee informed regarding the status and progress of the Claim and defense
of the Claim.

            7.4.3 If the indemnifying Party does not defend any Claim
encompassed by a Notice of Claim, the Indemnitee with respect thereto shall have
no obligation to do so, but the Indemnitee shall be permitted to do so at the
expense of the indemnifying Party without releasing or compromising the
Indemnitee's rights against the indemnifying Party in respect of the Claim and,
in such event, the Indemnitee may settle the Claim in any fashion determined by
the Indemnitee in its sole discretion and the indemnifying Party shall be fully
liable to the Indemnitee with respect thereto.

      7.5 LIMITATIONS.

            7.5.1 The amount of any Claim indemnifiable by a Party pursuant to
this Article VII shall be reduced by the amount of (a) any insurance proceeds
resulting from the subject matter of such Claim which are actually received by
the Indemnitee in respect of such Claim, net of any expenditures made in
connection with obtaining such insurance recovery, and (b) any Tax benefit
inuring to the Indemnitee as a result of the receipt of insurance proceeds or
indemnification payments respecting the Claim.

            7.5.2 Notwithstanding the provisions of Section 7.1, (a) the
liability of Sellers in respect of Claims indemnifiable under Section 7.1 shall
be limited to the amount by which all such Claims, in the aggregate, exceed the
sum of $750,000, and (b) the limitation set forth in Section 7.5.2(a) shall not
apply to Claims indemnifiable under Section 7.1 which arise from or relate to a
breach of the representations or warranties set forth in Sections 3.3.1, 3.3.2,
3.3.4, 3.3.5, 3.3.6, 3.4.1, 3.4.2, 3.4.4, 3.4.5, 3.4.9, 3.4.14, 3.5.1, 3.5.2,
3.5.3, 3.5.4, 3.6.1, 3.6.2, 3.6.4, 3.6.5 and 3.6.6.

            7.5.3 Notwithstanding any provision in any other section of this
Agreement, the liability of Sellers in respect of Claims indemnifiable under
Section 7.1 shall not exceed $12,000,000 in the aggregate which shall include
any amounts paid out of the Escrow Account in accordance with the Escrow
Agreement; provided, however, the liability of CH in respect of Claims
indemnifiable under Section 7.1 for the Taxes of the Company arising under
Treasury Regulation Section 1.1502-6 (or similar provision of state, local or
non-U.S. Laws) shall be unlimited.

                                       58


            7.5.4 Notwithstanding the provisions of Section 7.2, (a) the
liability of Buyer in respect of Claims indemnifiable under Section 7.2 shall be
limited to the amount by which all such Claims, in the aggregate, exceed the sum
of $750,000, and (b) the limitation set forth in Section 7.5.4(a) shall not
apply to Claims indemnifiable under Section 7.2 which arise from or relate to a
breach of the representations or warranties set forth in Sections 3.2.1, 3.2.2
and 3.2.4.

            7.5.5 Notwithstanding any other provision in this Agreement, the
liability of Buyer in respect of Claims indemnifiable under Section 7.2 shall
not exceed $12,000,000 in the aggregate.

            7.5.6 Notwithstanding any other provision in this Agreement, no
Seller shall be liable for any Claim not submitted for indemnification pursuant
to a Notice of Claim prior to (a) the last date of the applicable survival
period set forth in Section 3.7 for Claims related to a breach of any
representation or warranty in Article III, or (b) the date which is 24 months
following the Closing Date for all other Claims.

            7.5.7 Notwithstanding any other provision in this Agreement, Buyer
shall not be liable for any Claim not submitted for indemnification pursuant to
a Notice of Claim prior to (a) the last date of the applicable survival period
set forth in Section 3.7 for Claims related to a breach of any representation or
warranty in Article III, or (b) the date which is 24 months following the
Closing Date for all other Claims.

      7.6 DISPUTED CLAIMS FOR INDEMNIFICATION. In the event an indemnifying
Party disputes the validity or extent of any request for indemnification under
this Article VII and such dispute is not resolved amicably by or among the
indemnifying Party and the Indemnitee(s), such dispute shall be resolved
pursuant to Section 10.13.

      7.7 EXCLUSIVE REMEDY. After the Closing, except for the provisions of
Article II, the remedies provided in this Article VII shall be exclusive and
enforceable in lieu of all other remedies for any breach of any representation,
warranty, covenant, obligation, agreement or other provision of this Agreement.

                                  ARTICLE VIII
                             EMPLOYMENT ARRANGEMENTS

      8.1 TERMINATIONS OF EMPLOYMENT.

            8.1.1 Each Executive acknowledges that his respective Executive
Employment Agreement will automatically terminate as of the Closing by reason of
the occurrence of a Capital Event.

            8.1.2 Effective as of the Closing and except as otherwise determined
by Buyer, Company shall terminate any agreement or arrangement with any
Employees (a) who are not employed "at will" other than Robert Profumo, M.D., or
(b) if such agreements or arrangements could result in severance or other
payment obligations related to consummation of the transactions contemplated by
this Agreement.

                                       59


            8.1.3 Nothing in this Section 8.1 shall preclude the acceptance of a
New Executive Employment Arrangement by one or more of the
  Executives.

            8.1.4 Notwithstanding any contrary provision in this Agreement,
Sellers and Buyer hereby acknowledge that the resignations of the Executives
from any and all offices in the Company and as a member of the Board of the
Company as provided in Article I shall not constitute the resignation of any
Executive under the Executive's Executive Employment Agreement.

      8.2 NEW EXECUTIVE EMPLOYMENT ARRANGEMENTS.

            8.2.1 Sellers and Company hereby consent to Buyer, prior to Closing,
discussing with each Executive Buyer's interest in causing the Company to offer
such Executive an executive position with the Company after the Effective Time
on terms and conditions mutually acceptable to the Company and such Executive.

            8.2.2 No less than 15 Business Days prior to the Closing, Buyer
shall notify each Executive of the terms and conditions, if any, upon which such
Executive is being offered employment with the Company effective as of the
Effective Time.

            8.2.3 No less than 7 Business Days after Executive is apprised of
the terms and conditions, if any, upon which such Executive is being offered
employment with the Company effective as of the Effective Time, Executive shall
notify (a) Buyer of his acceptance or rejection of such terms and conditions,
and (b) SMHS and CH if he is accepting or rejecting any offer made by Buyer;
provided, however, such Executive shall not be obligated to advise SMHS or CH of
any of the terms and conditions of such employment.

            8.2.4 Effective as of the Closing, the Company and each Executive,
respectively, may mutually agree upon any New Executive Employment Arrangement
establishing the terms and conditions agreed upon by Company and such Executive
regarding employment by the Company from and after the Effective Time.

                                   ARTICLE IX
                                   TERMINATION

      9.1 TERMINATION OF AGREEMENT. This Agreement may be terminated at any time
prior to the Closing by:

            9.1.1 Mutual written consent of Buyer and Sellers;

            9.1.2 Buyer or Sellers immediately upon written notice to the other
Parties if (a) any Governmental Entity shall have enacted, promulgated or issued
any statute, rule, regulation, ruling, writ, order or injunction which would
prohibit or render illegal the consummation of the transactions contemplated by
this Agreement, or (b) any authorizations, consents or approvals of any
Governmental Entity, including the DOI, the State Agency and the Federal Trade
Commission (with respect to the HSR Act), which are required to permit the
Closing to take place pursuant to the provisions of this Agreement are denied or
granted with conditions or requirements which are materially adverse to the
terminating Party;

                                       60


            9.1.3 Buyer if a breach of any provision of this Agreement has been
committed by any Seller or the Company and such breach has not been (a) waived
in writing by Buyer, or (b) cured by the breaching Party to the reasonable
satisfaction of Buyer within 15 Business Days after service by Buyer of a
written notice upon the breaching Party which describes the nature of such
breach with reasonable particularity (with a copy of such notice being provided
to all Parties);

            9.1.4 Sellers if a breach of any provision of this Agreement has
been committed by Buyer and such breach has not been (a) waived in writing by
Sellers, or (b) cured by Buyer to the reasonable satisfaction of Sellers within
15 Business Days after service by Sellers of a written notice upon Buyer which
describes the nature of such breach with reasonable particularity (with a copy
of such notice being provided to all Parties); or

            9.1.5 Buyer or Sellers immediately upon written notice to the other
Parties if the Closing has not occurred on or before December 31, 2007,
provided, however, the right to terminate this Agreement pursuant to this
Section 9.1.5 shall not be available to a Party seeking to terminate this
Agreement if such Party has failed to comply fully with its obligations under
this Agreement.

      9.2 EFFECT OF TERMINATION. In the event this Agreement is terminated
pursuant to Section 9.1, all rights and obligations of the Parties hereunder
shall terminate without any liability of any Party to the other Parties,
including under Article VIII; provided, however, (a) a Party in breach of this
Agreement shall remain liable for damages resulting from such breach, and (b)
the provisions of this Section 9.2 and Sections 6.3, 10.2, 10.10 and 10.13 shall
survive any termination of this Agreement.

                                    ARTICLE X
                                  MISCELLANEOUS

      10.1 CONSTRUCTION.

            10.1.1 The Parties have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the Parties and no presumption or burden of proof shall arise favoring or
disfavoring any Party by virtue of the authorship of any of the provisions of
this Agreement.

            10.1.2 Unless the context of this Agreement otherwise requires, the
following shall be applicable herein: (a) words using the singular or plural
number also include the plural or singular number, respectively; (b) headings
and titles of Articles, Sections, Exhibits and Sections of the Disclosure
Schedule are included for convenience only and shall not be considered a part of
this Agreement when interpreting or enforcing this Agreement; (c) references to
Sections, Articles and Exhibits are to the applicable Sections, Articles and
Exhibits

                                       61


of this Agreement; (d) use of the word "including" shall be illustrative rather
than exclusive and shall be interpreted in all instances to mean "including,
without limitation;" and (e) the predicate of any noun or pronoun shall be the
immediately preceding noun.

      10.2 PRESS RELEASES AND PUBLIC ANNOUNCEMENTS. Without the prior written
approval of each of the Parties, no Party, either prior to or after the Closing,
shall issue, or consent to or cooperate with the issuance by a Third Party of, a
press release or other public announcement regarding (a) the execution of this
Agreement, or (b) any or all of the transactions contemplated by this Agreement;
provided, however, nothing herein shall preclude a Party from complying with its
or his respective responsibilities under applicable Laws.

      10.3 ENTIRE AGREEMENT. Except as set forth in the Confidentiality
Agreement, this Agreement (a) constitutes the entire understanding and agreement
of the Parties with respect to the subject matter hereof, and (b) supersedes all
prior negotiations, correspondence, discussions and agreements, written or oral,
among the Parties with respect to the subject matter hereof.

      10.4 NO THIRD PARTY BENEFICIARIES. None of the provisions contained in
this Agreement are intended by the Parties, nor shall they be deemed, to confer
any benefit on any person or entity not a Party to this Agreement other than any
Person entitled to indemnification under Article VII.

      10.5 FURTHER ASSURANCES. From and after the Agreement Date, each Party
shall execute and deliver such additional documents and other instruments and do
all such other acts and things as reasonably may be necessary or otherwise
appropriate to effect and implement the transactions contemplated by this
Agreement.

      10.6 SUCCESSORS AND ASSIGNS. All of the terms and provisions of this
Agreement shall be binding upon, inure to the benefit of and be enforceable by
the respective successors, assigns and heirs of the Parties.

      10.7 ASSIGNMENT. No Party shall have the right to assign this Agreement
without the prior written consent of each of the other Parties and any attempted
assignment of this Agreement by any of the Parties without such prior written
consents shall be of no force or effect.

      10.8 AMENDMENT. This Agreement may not be amended or modified unless
pursuant to a written instrument which refers specifically to this Agreement and
is executed by the Parties.

      10.9 NOTICES.

            10.9.1 Any notice or other instrument which is required or permitted
to be given under this Agreement to a Party shall be deemed sufficiently given
if (a) delivered personally, (b) sent by registered or certified U.S. Mail,
return receipt requested and postage prepaid, (c) sent by national overnight
delivery service (such as FedEx) with charges prepaid, or (d) sent by telefax,
in each instance, addressed and delivered personally or sent for delivery as set
forth on Exhibit B attached hereto, subject, however, to changes as provided in
Section 10.9.2.

                                       62


            10.9.2 Each Party shall have the right, from time-to-time, to change
(a) its or his address, (b) the person to whose attention notices and other
communications are to be given, (c) its or his telefax number, and (d) the
entity, and particulars regarding such entity, to which copies of notices and
other communications to such Party are to be given, in each instance by written
notice thereof to the other Parties.

            10.9.3 Any notice or copy thereof (a) personally delivered shall be
deemed given when received by the intended recipient, (b) sent by telefax shall
be deemed given when so sent to the intended recipient, provided the original of
such notice or copy thereof is given by another means specified in Section
10.9.1, and (c) sent by registered or certified U.S. Mail or an overnight
delivery service shall be deemed given on the earlier of the date of receipt by
the intended recipient or three days after the date on which such notice or copy
thereof is sent.

      10.10 EXPENSES AND ATTORNEYS' FEES. Subject to Sections 2.2.8(d),
2.3.7(d), 2.4.8(d), 4.3.2(a) and 10.13.8(f), (a) each Party shall be responsible
exclusively for its own costs and expenses relating to (i) the negotiation and
preparation of this Agreement, (ii) the conduct of any due diligence in
connection with the transactions contemplated by this Agreement, (iii) any
actions taken to consummate the transactions contemplated by this Agreement, and
(iv) fulfillment of its obligations under this Agreement, in each instance
whether the Closing occurs, and (b) in no event shall any Party be responsible
for the fees of, or the costs and expenses incurred by, a Representative of
another Party.

      10.11 WAIVERS. No consent or waiver, express or implied, by any Party to
or for any breach or default by any other Party(ies) or the performance by any
other Party(ies) of their obligations under this Agreement shall be deemed or
construed to be a consent or waiver to or of any other breach or default in the
performance by such Party(ies) of the same or any other obligations of such
Party(ies) hereunder. To be effective, all such consents and waivers shall be in
writing and executed by the Party(ies) giving the consent or waiver. All such
consents and waivers shall be construed strictly. Except to the extent expressly
provided to the contrary herein, failure on the part of any Party to complain of
any act or failure to act of another Party(ies) or to declare another Party(ies)
in default, irrespective of how long such failure continues, shall not
constitute a waiver by such Party of its rights hereunder.

      10.12 SEVERABILITY. If any term, provision, condition or covenant of this
Agreement or the application thereof to any Party or circumstance shall be held
to be invalid or unenforceable to any extent in any jurisdiction, the remainder
of this Agreement and the application of such term, provision, condition or
covenant in any other jurisdiction or to persons or circumstances other than
those as to whom or which it is held to be invalid or unenforceable, shall not
be affected thereby, and each term, provision, condition and covenant of this
Agreement shall be valid and enforceable to the fullest extent permitted by Law.

      10.13 BINDING ARBITRATION. Any Claim by a Party or an Indemnitee against
another Party or Indemnitee, inclusive of a dispute under Article VII but
exclusive of any post-Closing adjustment in Article II in which the dispute is
required to be resolved by an Independent Accountant, arising out of or relating
to this Agreement or the breach thereof which is not resolved amicably by the
parties involved in the Claim shall be resolved exclusively by arbitration in
accordance with the following provisions:

                                       63


            10.13.1 Arbitration shall (a) take place in the City of St. Louis,
Missouri, and (b) be administered by the American Arbitration Association.

            10.13.2 A Petitioner(s) shall indicate intent to commence
arbitration of a Claim by giving written notice of such intent to the
Respondent(s).

            10.13.3 If the Petitioner(s) and Respondent(s) are unable to resolve
the Claim within 15 Business Days following the receipt by the Respondent(s) of
the notice identified in Section 10.13.2, arbitration shall commence upon the
delivery by the Petitioner(s) to the Respondent(s) of a petition complying with
the Arbitration Rules and setting forth at a minimum (a) the acts or omissions
complained of, (b) the Section or Sections of this Agreement breached or
otherwise involved, and (c) the relief sought. The Respondent(s) shall respond
to such petition in conformity with the Arbitration Rules and counterclaims and
cross-petitions shall be permitted if timely filed and served.

            10.13.4 The arbitration shall be conducted in conformance with the
Arbitration Rules except as otherwise provided in this Section 10.13; provided,
however, (a) the Petitioner(s) and Respondent(s) may provide any instructions to
the arbitrator(s) which deviate from the Arbitration Rules as the Petitioner(s)
and Respondent(s) may mutually agree, and (b) unless the Petitioner(s) and
Respondent(s) mutually agree otherwise, they shall have the right to conduct
discovery in any manner and to the extent authorized by the Federal Rules of
Civil Procedure as interpreted by the Federal courts in the Eastern District of
Missouri.

            10.13.5 If the Petitioner(s) and Respondent(s) are able to agree
upon a single arbitrator within ten Business Days following commencement of the
arbitration, such individual shall serve as the arbitrator.

            10.13.6 If the Petitioner(s) and Respondent(s) are unable to agree
timely upon a single arbitrator, there shall be three arbitrators designated as
follows: (a) Petitioner(s) shall designate one arbitrator; (b) Respondent(s)
shall designate one arbitrator; and (c) the respective arbitrators designated by
the Petitioner(s) and Respondent(s) shall select a third arbitrator within ten
Business Days following the date on which the last of them is designated;
provided, however, if the respective arbitrators designated by the Petitioner(s)
and Respondent(s) are unable to agree timely upon the selection of a third
arbitrator, the third arbitrator shall be appointed by the commercial panel of
the American Arbitration Association.

            10.13.7 In the event (a) a single arbitrator is used, the written
decision of that arbitrator shall be final and binding upon the Petitioner(s)
and Respondent(s), and (b) three arbitrators are used, the written decision of
at least two of the three arbitrators shall be final and binding upon the
Petitioner(s) and Respondent(s).

            10.13.8 With respect to any award in arbitration, the arbitrator(s):

                                       64


                  (A)   Shall issue an award in writing which (i) sets forth
                        findings of fact, (ii) resolves each specific Claim,
                        (iii) attaches a reasoned opinion, and (iv) is signed by
                        the single arbitrator or by at least two of the three
                        arbitrators, as the case may be;

                  (B)   Shall have no authority to award punitive damages;

                  (C)   May not award money damages unless the notice identified
                        in Section 10.13.2 is delivered within two years after
                        the right of action accrues or, in the case of a
                        counterclaim or cross-petition, within one year after
                        the delivery of such counterclaim or cross-petition,
                        provided, however, for purposes of computing this
                        limitation period, all periods during which facts
                        material to the right of action are not known and
                        reasonably could not be known by the Petitioner(s) or
                        Respondent(s) seeking money damages shall be excluded;

                  (D)   May compel specific performance by the Petitioner(s) or
                        the Respondent(s) of their respective obligations under
                        this Agreement or award injunctive relief to restrain
                        any breach of this Agreement by a Petitioner or
                        Respondent, in each instance without the necessity of
                        the Petitioner(s) (i) alleging or proving damages as a
                        result of the breach, or (ii) posting any bond;
                        provided, however, seeking or obtaining equitable relief
                        shall not preclude a party to the arbitration from also
                        seeking or obtaining an award for money damages in the
                        arbitration subject to Sections 10.13.8(b) and
                        10.13.8(c);

                  (E)   Shall adjust any award to assure that no Petitioner(s)
                        or Respondent(s) obtains double recovery for any amounts
                        duplicative of amounts for which such party, directly or
                        indirectly, has already received credit under any
                        adjustment mechanism set forth in this Agreement; and

                  (F)   Shall assess to the non-prevailing party(ies) all (i)
                        administrative fees and expenses of the arbitrator(s)
                        and the arbitration, and (ii) fees and expenses incurred
                        by the prevailing party(ies) in connection with the
                        arbitration; provided, however, the arbitrator(s) in
                        its(their) discretion may equitably allocate such fees
                        and expenses between or among the Petitioner(s) and
                        Respondent(s).

            10.13.9 Judgment upon an award in arbitration may be entered in any
court of competent jurisdiction in the United States.

                                       65


      10.14 RECITALS. Each recital to this Agreement is incorporated into and
shall constitute an integral part of this Agreement.

      10.15 EXHIBITS AND DISCLOSURE SCHEDULE. Each Exhibit and the Disclosure
Schedule shall be incorporated into, and shall constitute an integral part of,
this Agreement by this reference thereto.

      10.16 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.

                    BALANCE OF PAGE INTENTIONALLY LEFT BLANK

                                       66


                      SIGNATURE PAGE TO PURCHASE AGREEMENT

      IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
date first above written.

      THIS AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION THAT MAY BE
ENFORCED BY THE PARTIES.

BUYER:                                          CH:

MOLINA HEALTHCARE, INC.                         CCP HOLDINGS, LLC

By: /s/ John C. Molina                          By: /s James V. O'Donnell
    ----------------------------------              ----------------------------
Name: John C. Molina                            Name: James V. O'Donnell
      --------------------------------                --------------------------
Title: Chief Financial Officer                  Title: Vice President
       -------------------------------                 -------------------------

COMPANY:                                        EXECUTIVES:

ALLIANCE FOR COMMUNITY                          /s/ Jerry Linder
HEALTH, L.L.C.                                  --------------------------------
d/b/a Mercy CarePlus                            Jerry Linder

By:   /s/ Matthew Koster                        /s/ Cristopher Cristea
      --------------------------------          --------------------------------
Name: Matthew Koster                            Cristopher Cristea
      --------------------------------
Title: Chairman
      --------------------------------
                                                /s/ Edward Oswald
                                                -------------------------------
                                                Edward Oswald

                                                SMHS:

                                                SISTERS OF MERCY HEALTH SYSTEM

                                                By: /s/ John Sullivan
                                                    ----------------------------
                                                Name: John Sullivan
                                                      --------------------------
                                                Title: President/CEO
                                                       -------------------------

                                       67


                                    EXHIBIT A
                                   DEFINITIONS

      "AFFILIATE" means any Person who or which, directly or indirectly,
controls, is controlled by or is under common control with, the referenced
Person. For purposes of this definition, the term "control" (including
"controlled by" or "under common control with") includes the authority to (a)
approve the admission of a majority of the members, shareholders or partners of
the referenced Person, or (b) appoint, elect or approve a majority of the Board
of the referenced Person.

      "AGREEMENT" has the meaning set forth in the preface to the purchase
agreement to which this Exhibit A is attached.

      "AGREEMENT DATE" has the meaning set forth in the preface to the
Agreement.

      "ARBITRATION RULES" means the Commercial Arbitration Rules of the American
Arbitration Association.

      "BASE PURCHASE PRICE" means $80,000,000.

      "BENEFIT PLAN" means any agreement, arrangement, plan or policy, qualified
or non-qualified, whether or not considered legally binding and whether or not
written, that involves any (a) pension, including any pension benefit plan as
described in Section 3(2) of ERISA or any welfare benefit plan as described in
Section 3(1) of ERISA, retirement, profit sharing, deferred compensation, bonus,
stock option, stock purchase, phantom stock or incentive plan, or (b) welfare or
"fringe benefits," including vacation, severance, disability, medical,
hospitalization, dental, life and other insurance, tuition, company car, club
dues, sick leave, maternity, paternity or family leave, health care
reimbursement, dependent care assistance, cafeteria plan, regular in-kind gifts
or other benefits, in each instance sponsored, maintained or contributed to or
required to be contributed to by the Company as of the Agreement Date for the
benefit of Employees or former employees of the Company.

      "BOARD" means the Board of Directors, Board of Managers, Board of Trustees
or similar governing body of the referenced Person.

      "BUSINESS" means all of the operations conducted by the Company, including
arranging for the provision of comprehensive health care services to Medicaid
recipients pursuant to the terms of the Medicaid Contracts.

      "BUSINESS DAY" means any day other than Saturday, Sunday or any day on
which banks in the City of New York, New York are closed.

      "BUYER" has the meaning set forth in the preface to the Agreement.

      "CAPITAL AND SURPLUS" means the Company's capital and surplus as of a
given date determined under SAP.



      "CAPITAL EVENT" has the meaning set forth in the Operating Agreement.

      "CH" has the meaning set forth in the preface to the Agreement.

      "CLAIM" means any and all liabilities (whether asserted or unasserted,
absolute or contingent), obligations, losses, damages, deficiencies, demands,
disputes, claims, fines, penalties, interest, assessments, judgments, Liens,
charges, orders, decrees, rulings, dues, assessments, Taxes, actions,
injunctions, proceedings and suits of whatever kind and nature and all costs and
expenses relating thereto, including fees and expenses of counsel, accountants
and other experts, and other expenses of investigation and litigation.

      "CLASS A UNIT" means any of the Class A Units described in Section
3.2(a)(i) of the Operating Agreement.

      "CLASS B UNIT" means any of the Class B Units described in Section
3.2(a)(ii) of the Operating Agreement.

      "CLASS C UNIT" means any of the Class C Units described in Section
3.2(a)(iii) of the Operating Agreement.

      "CLOSING" means consummation of the transaction whereby Buyer purchases
all of the Units from Sellers pursuant to the provisions of this Agreement.

      "CLOSING DATE" means (a) October 31, 2007, or (b) such other date as Buyer
and Sellers may mutually agree in writing.

      "CODE" means the Internal Revenue Code of 1986, as amended.

      "COMPANY" has the meaning set forth in the preface to the Agreement.

      "COMPANY ARTICLES" means the Amended and Restated Articles of Organization
of the Company in effect as of the Agreement Date.

      "COMPETITIVE BUSINESS" means arranging for the provision of health care
services to Medicaid recipients pursuant to the terms of a contract with the
State Agency.

      "CONFIDENTIAL INFORMATION" means, to the extent not generally available or
ascertainable from public or published information or trade sources or not a
part of the public domain, other than by reason of a breach of the provisions of
Section 6.3, the following information related to the Company or the Business:
(a) financial statements, (b) rate, price, cost and expense data, (c) trade
secrets, (d) strategic planning information, (e) Enrollee information, (f)
agreements with providers and third party payors, (g) employee lists, (h) vendor
lists, and (i) all other information of a proprietary nature.

      "CONFIDENTIALITY AGREEMENT" means that certain letter agreement dated as
of August 22, 2006, as amended, between Buyer and the Company.

                                       2


      "CONTRACT" means any contract, agreement, arrangement, understanding or
instrument, whether oral or written, and any amendments thereto.

      "DESIGNATED CONTRACTS" means those Contracts identified in Section
3.4.17(a) of the Disclosure Schedule.

      "DISCLOSURE SCHEDULE" means the series of disclosures made by Sellers to
Buyer on a document titled "Disclosure Schedule" and attached hereto (or, in
certain cases as identified in such attachment, by cd-rom).

      "DOI" means the Missouri Department of Insurance, Financial Institutions
and Professional Registration.

      "EARNINGS" means the actual EBITDA of the Company (i.e., earnings before
interest, taxes, depreciation and amortization) for the Earnings Period,
calculated in accordance with GAAP, and adjusted to (a) maintain consistency
with the methodology used to calculate the Company's EBITDA on a historical
basis (with the exception that medical loss expense shall reflect IBNR as of
June 30, 2008 equal to the sum of (i) Medical Payments (for Medical Claims
incurred prior to July 1, 2008) commencing on July 1, 2008 and ending on the
later of November 30, 2008, and the last date for which triangulated information
is available for such Medical Payments, plus (ii) an estimate of remaining June
30, 2008 IBNR calculated consistent with past practices), (b) exclude any
expenses related to or resulting from the Closing, including any
acquisition-related legal fees and any termination payments to the Executives,
and (c) with respect to "Sales, General and Administration Expenses," (i) use
the actual SG&A expenses incurred by the Company during each month pre-Closing
as applied consistently by the Company (exclusive of any acquisition-related
legal fees and any termination payments to the Executives), and (ii) use the sum
of $1,283,000 for SG&A expenses attributed to the Company during each month
post-Closing as applied consistently by the Company (regardless of the Company's
actual SG&A expenses for such month).

      "EARNINGS DISAGREEMENT" has the meaning set forth in Section 2.3.3.

      "EARNINGS NOTICE OF DISAGREEMENT" has the meaning set forth in Section
2.3.3.

      "EARNINGS PERIOD" means the twelve month period ending June 30, 2008.

      "EARNINGS REPORT" has the meaning set forth in Section 2.3.1.

      "EFFECTIVE TIME" means 11:59:59 PM central time on the Closing Date.

      "EMPLOYEE" means an employee of the Company on the Closing Date.

      "EMPLOYMENT AGREEMENT" means a contract, offer letter or agreement of the
Company with any Employee, former employee of the Company or employee of the
Company on the Agreement Date who is not an Employee pursuant to which the
Company has any actual or contingent liability or obligation to provide
compensation or benefits in consideration for past, present or future services
(including payments in connection with the transactions contemplated by this
Agreement) other than an Executive Employment Agreement.

                                       3


      "ENROLLEES" means those individuals enrolled in the Medicaid managed care
health plan established and maintained by the Company.

      "ENVIRONMENTAL, HEALTH AND SAFETY REQUIREMENTS" means all Federal, state
and local statutes, laws, rules, regulations and ordinances concerning public
health and safety, worker health and safety, environmental regulation or control
and pollution or protection of the environment, including all those relating to
the presence, use, production, generation, handling, transportation, treatment,
storage, disposal, distribution, labeling, testing, processing, discharge,
release, threatened release, control or cleanup of any Hazardous Substances, as
such requirements are enacted and in effect on or prior to the Closing Date.

      "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.

      "ESCROW ACCOUNT" means the interest-bearing account established with the
Escrow Agent pursuant to the Escrow Agreement.

      "ESCROW AGENT" means Southwest Bank of St. Louis, or such other person or
entity as may be agreed upon by Buyer and Sellers, acting under and pursuant to
the obligations of the escrow agent set forth in the Escrow Agreement.

      "ESCROW AGREEMENT" means the agreement among Buyer, CH, each Executive,
SMHS and the Escrow Agent dated as of the Closing Date which is titled "Escrow
Agreement" and the form of which is attached as Exhibit C.

      "EXECUTIVES" means Linder, Cristea and Oswald, collectively.

      "EXECUTIVE EMPLOYMENT AGREEMENTS" means the Executive Employment
Agreements dated May 28, 2004, between the Company and each Executive,
respectively.

      "FINAL IBNR ADJUSTMENT" means (a) the IBNR Report if no IBNR Notice of
Disagreement is delivered, or (b) if an IBNR Notice of Disagreement is
delivered, the difference between the amount of (i) IBNR reflected on the
balance sheet prepared in conjunction with the Final RBC Calculation, and (ii)
Medical Payments (for Medical Claims incurred prior to the Effective Time)
commencing on the day following the Closing Date and ending on the later of the
IBNR Calculation Date and the date of the Independent Accountant's determination
pursuant to Section 2.4.9, as (A) agreed upon by Buyer and Sellers pursuant to
an amicable resolution of any IBNR Disagreement(s) pursuant to Section 2.4.6, or
(B) finally decided by the Independent Accountant pursuant to Section 2.4.9.

      "FINAL RBC CALCULATION" means the (a) the Proposed Final RBC Calculation
if no RBC Notice of Disagreement is delivered, or (b) if an RBC Notice of
Disagreement is delivered, (i) the calculation of Capital and Surplus and RBC as
of the Closing as agreed upon by Buyer and Sellers pursuant to an amicable
resolution of any RBC Disagreement(s) pursuant to Section 2.2, or (ii) the
calculation of Capital and Surplus and RBC as of the Closing as finally decided
by the Independent Accountant pursuant to Section 2.2.

                                       4


      "FINANCIAL STATEMENTS" means (a) the audited income statements and balance
sheets of the Company for each of the fiscal years ended December 31, 2004, 2005
and 2006 prepared in accordance with SAP in each instance, and (b) the unaudited
income statement and balance sheet of the Company for the partial year
commencing January 1, 2007 and ending July 31, 2007 prepared in accordance with
GAAP.

      "FIRPTA" means the Foreign Investment in Real Property Tax Act, as
amended.

      "FORGIVENESS" has the meaning set forth in the respective Executive
Employment Agreements.

      "GAAP" means United States generally accepted accounting principles as in
effect from time to time, consistently applied.

      "GOVERNMENTAL ENTITY" means any Federal, state, regional, county,
municipal or local court, agency, department, division, board, bureau or
commission or other governmental or regulatory authority.

      "GROSS-UP PAYMENT" has the meaning set forth in the Executive Employment
Agreements.

      "HAZARDOUS SUBSTANCE" means petroleum, petroleum by-products,
polychlorinated biphenyls and any other chemicals, materials, substances or
wastes which are currently defined or regulated as "hazardous substances,"
"hazardous materials," "hazardous wastes," "extremely hazardous wastes,"
"restricted hazardous wastes," "toxic substances," "toxic pollutants," "toxic
air pollutants," "hazardous air pollutants," "pollutants" or "contaminants"
under any Law.

      "HIPAA" means the Health Insurance Portability and Accountability Act of
1996, as amended, and the rules and regulations promulgated thereunder.

      "HSR ACT" means the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended, and the rules and regulations promulgated thereunder.

      "IBNR" means the actuarial estimate of Medical Claims which remain unpaid,
including (a) undisputed Medical Claims reported to the Company, (b) Medical
Claims reported to the Company but disputed by the Company, and (c) Medical
Claims incurred but not yet reported to the Company.

      "IBNR CALCULATION DATE" means November 30, 2008.

      "IBNR DISAGREEMENT" has the meaning set forth in Section 2.4.4.

      "IBNR NOTICE OF DISAGREEMENT" has the meaning set forth in Section 2.4.4.

                                       5


      "IBNR REPORT" has the meaning set forth in Section 2.4.1.

      "INDEMNITEE" means a Person entitled to indemnification pursuant to
Sections 7.1 or 7.2, as the case may be.

      "INDEPENDENT ACCOUNTANT" means an independent certified public accountant
selected pursuant to Article II.

      "INTELLECTUAL PROPERTY" means any United States or foreign trademarks,
trade names, service marks, Internet domain names, copyrights, inventions,
patents, trade secrets, know-how, proprietary processes, formulae, customer
lists, confidential information, computer software, databases, technology and
all other intellectual property rights, and any applications or registrations
relating to any of the foregoing and the goodwill relating to any of the
foregoing.

      "IRS" means the Internal Revenue Service of the United States Department
of the Treasury.

      "KNOWLEDGE OF ANY OF THE EXECUTIVES" means the actual knowledge of Linder,
Cristea or Oswald after reasonable inquiry of any other Employees who have
principal responsibility for the matter in question or are otherwise likely to
have information relevant to the matter.

      "KNOWLEDGE OF BUYER" means the actual knowledge of Buyer's Chief Executive
Officer, Chief Operating Officer or Chief Financial Officer after reasonable
inquiry of any employees of Buyer who have principal responsibility for the
matter in question or are otherwise likely to have information relevant to the
matter.

      "KNOWLEDGE OF CH" means the actual knowledge of CH's President, Chief
Operating Officer or Chief Financial Officer after reasonable inquiry of any
employees of CH who have principal responsibility for the matter in question or
are otherwise likely to have information relevant to the matter.

      "KNOWLEDGE OF SMHS" means the actual knowledge of SMHS' President, Chief
Operating Officer or Chief Financial Officer after reasonable inquiry of any
employees of SMHS or its Affiliates who have principal responsibility for the
matter in question or are otherwise likely to have information relevant to the
matter.

      "LAWS" means all applicable Federal, state and local laws, policies,
rules, regulations, orders, guidance, interpretations, manuals and
communications, including Medicaid, the State HMO Law, HIPAA, ERISA, the
Environmental, Health and Safety Requirements and the Securities Act.

      "LEASED REAL PROPERTY" means the real property leased by the Company and
located at (a) 10123 Corporate Square Drive, St. Louis, Missouri 63132, (b) 428
East Capitol Avenue, Jefferson City, Missouri 65101 (second floor), and (c)
18600 East 37th Terrace South, Suite 105, Independence, Missouri 64057.

                                       6


      "LEASES" means all leases and other agreements (written or oral),
including all amendments, extensions, renewals, guarantees and other agreements
with respect thereto in which the Company is the lessee or lessor.

      "LICENSE" means any franchise, approval, permit, order, authorization,
consent, license, registration or filing, certificate, variance and any other
similar right obtained from or filed with any Governmental Entity.

      "LICENSE AGREEMENT" means the License Agreement dated as of the Closing
Date, and which becomes effective immediately following the Effective Time,
between the Company and SMHS, the form of which is attached as Exhibit D
(whereby Company is entitled to use the name "Mercy CarePlus" through December
31, 2008 subject to the terms and provisions therein).

      "LIEN" means any mortgage, pledge, lien, charge, security interest, defect
of title, encroachment, adverse claim of ownership or use, deficiency,
exception, restriction on transfer (such as a right of first refusal) or other
encumbrance of any kind or character.

      "MATERIAL ADVERSE EFFECT" means any event, occurrence, circumstance,
change or other matter which occurs during the period commencing on the
Agreement Date and ending on the Closing Date, and which individually or in the
aggregate with any other events, occurrences, circumstances, changes or other
matters, has, or is reasonably likely to (a) have an adverse monetary effect on
the Business or the current or future prospects of the Business exceeding
$500,000, exclusive of Medical Claims, (b) prohibit any Party from consummating
the transactions contemplated by this Agreement, or (c) result in the total
number of Enrollees set forth in the Monthly Remittance Advice received from the
State Agency for the calendar month during which the Closing Date occurs being
less than 85% of the total number of Enrollees set forth in the Monthly
Remittance Advice received from the State Agency for August 2007.

      "MEDICAID" means the Federal-State health insurance programs administered
by the State through the State Agency which provide medical assistance to
eligible persons covered under Title XIX and Title XXI (including the State
Children's Health Insurance Program) of the Social Security Act.

      "MEDICAID CONTRACTS" means the three agreements, as executed and in effect
from time to time between the State Agency and the Company, pursuant to which
the Company provides comprehensive health care services to Enrollees in the
eastern, central and western regions of the State, respectively, under the
managed health care delivery program operated by the State Agency through a
managed care medical service delivery system.

      "MEDICAL CLAIMS" means all medical claims (physician, hospital, ancillary
and other claims directly related to the provision of covered health care
services) incurred by the Company on or prior to the date of the applicable
balance sheet in connection with the provision of covered health care services
to Enrollees.

      "MEDICAL PAYMENTS" means the actual payments made by the Company during
the applicable period to satisfy Medical Claims which constitute IBNR on the
applicable balance
                                       7


sheet net of refunds and credits received by the Company during such period with
respect to Medical Claims, including Provider refunds, reinsurance (paid or
accrued), subrogation receipts and coordination of benefit payments.

      "MONTHLY REMITTANCE ADVICE" means the State Agency's monthly report to the
Company which reflects the number of Enrollees as of the last day of the month
of such report, including the summary report thereof.

      "NEW EXECUTIVE EMPLOYMENT ARRANGEMENT" means an "at will" employment
arrangement which becomes effective as of the Closing Date and is mutually
acceptable to Buyer, Company and/or each of Linder, Cristea and Oswald,
respectively, as set forth in Buyer's usual and customary terms and conditions
of employment applicable to similarly situated executive employees of Buyer or
its Affiliates.

      "NON-COMPETE PERIOD" means the period commencing as of the Effective Time
and ending on the third anniversary thereof unless such period is earlier
terminated with respect to an Executive pursuant to a New Executive Employment
Arrangement or as otherwise provided herein.

      "NOTICE OF CLAIM" has the meaning set forth in Section 7.3.

      "OPERATING AGREEMENT" means the Fifth Amended and Restated Operating
Agreement of the Company dated September 29, 2006.

      "ORDINARY COURSE OF BUSINESS" means the conduct of the Business in a
commercially reasonable manner in the ordinary course consistent with past
practices and in compliance with applicable Laws and contractual obligations.

      "PARTIES" means Buyer, the Company, SMHS, CH, Linder, Cristea and Oswald,
collectively, and each of them is a "Party."

      "PERMITTED INVESTMENT" means an ownership interest in any Person,
including a competitor of the Company, listed on a national securities exchange
or traded in the over-the-counter market, but only if the investor or any
Affiliate of such investor (a) is not involved in the management or operations
of the business of such Person, and (b) does not own more than an aggregate of
1% of the ownership interest in such Person.

      "PERMITTED LIENS" means (a) liens for current Taxes not yet due and
payable or for current Taxes which the taxpayer is contesting in good faith
through appropriate proceedings and for which appropriate reserves have been
established in accordance with GAAP, (b) purchase money liens and liens securing
rental payments under capital lease arrangements, arising in each case in the
Ordinary Course of Business, which would not, individually or in the aggregate,
materially interfere with the present use of or materially impair the value of
the affected assets or properties, (c) liens of landlords, mechanics,
materialmen, workmen, repairmen, warehousemen and carriers arising in the
Ordinary Course of Business which are not overdue and which would not,
individually or in the aggregate, materially interfere with the present use of
or materially
                                       8


impair the value of the affected assets or properties, and (d) all applicable
zoning, building and similar laws which are not violated by current occupancy or
use and which would not, individually or in the aggregate, materially interfere
with the present use of or materially impair the value of the affected assets or
properties.

      "PERSON" means an individual, partnership, corporation, limited liability
company, an unincorporated association, joint stock company, trust, joint
venture and any other entity, including a Governmental Entity.

      "PETITIONER" means a Party or an Indemnitee asserting a Claim in
arbitration pursuant to Section 10.13.

      "PLEDGE AGREEMENT" means the Collateral Pledge Agreement dated May 28,
2004, between CCP Acquisition Limited, a Missouri corporation, and each
Executive, respectively, securing the payment of the Promissory Note of the
respective Executive, and collectively they are the "Pledge Agreements."

      "POST-CLOSING LIABILITIES" means liabilities or obligations, direct or
indirect, absolute or contingent, known or unknown, whether or not accrued,
arising from or related to the operations of the Business from and after the
Closing.

      "PRE-CLOSING DIVIDENDS" means any and all payments, whether of cash,
assets or other property of the Company, made to Sellers by Company during the
period following the Agreement Date and prior to the Closing (a) on account of
their respective membership interests in the Company, including distributions,
dividends, redemptions, exchanges, reclassifications or otherwise, and (b) not
inconsistent with the provisions of this Agreement or the Operating Agreement.

      "PRE-CLOSING LIABILITIES" means liabilities or obligations, direct or
indirect, absolute or contingent, known or unknown, whether or not accrued,
arising from or related to the operations of the Business prior to the Closing
other than liabilities or obligations (a) accrued or reserved for on the balance
sheets included in the Financial Statements or on the balance sheet prepared in
conjunction with the Final RBC Calculation, (b) set forth in the Disclosure
Schedule, (c) incurred after June 30, 2007, in the Ordinary Course of Business,
or (d) taken into consideration in determining the Final RBC Calculation.

      "PRO FORMA RBC CALCULATION" means the calculation made by the Company in
accordance with SAP prior to the Closing estimating, as of the Effective Time,
in a pro forma balance sheet format, (a) Capital and Surplus, and (b) RBC;
provided, however, IBNR shall be equal to the sum of an estimated IBNR amount
consistent with past practices plus $1,000,000.

      "PROMISSORY NOTE" has the meaning set forth in each respective Executive
Employment Agreement, and collectively they are the "Promissory Notes."

      "PROPOSED FINAL RBC CALCULATION" means the calculation by Company in
accordance with SAP of (a) Capital and Surplus, and (b) RBC as of the Effective
Time, in a balance sheet

                                       9


format (i) excluding goodwill/intangible assets associated with the Closing,
(ii) excluding capital infusions made by Buyer associated with the Closing,
(iii) excluding the $1,000,000 additional reserve for IBNR included in the Pro
Forma RBC Calculation, and (iv) reflecting IBNR equal to the sum of (A) Medical
Payments (for Medical Claims incurred prior to the Effective Time) commencing on
the day following the Closing Date and ending on the day which is 90 days
following the Closing Date, plus (B) an estimate of Closing Date IBNR which
remains unpaid as of 90 days following the Effective Time.

      "PROPOSED IBNR ADJUSTMENT" means the difference, as proposed by the
Company in the IBNR Report, between the amount of (a) IBNR reflected on the
balance sheet prepared in conjunction with the Final RBC Calculation, and (b)
the Medical Payments (for Medical Claims incurred prior to the Effective Time)
commencing on the day following the Closing Date and ending on the IBNR
Calculation Date.

      "PROVIDER" means any physician, hospital, skilled nursing facility, home
health agency or other Person or network of Persons who or which is engaged in
providing or arranging for the provision of health care or related services or
supplies to or for the benefit of the Company.

      "PROVIDER AGREEMENTS" means Contracts entered into with Providers or
networks of Providers by the Company for the provision of health care or related
services or supplies to Enrollees.

      "RBC" means the Company's "Risk Based Capital-Authorized Control Level"
(as such term is defined by the National Association of Insurance Commissioners)
calculated (a) as of a given date, and (b) using the same methodology and
factors utilized by the Company in its "Health Annual Statement for the Year
Ending December 31, 2006 of the Condition and Affairs of Alliance for Community
Health, L.L.C." filed with the State.

      "RBC ADJUSTMENT" means the difference between (a) the calculation of
Capital and Surplus less 200% of RBC on the Final RBC Calculation, and (b) the
amount of the Pre-Closing Dividend paid by Company to Sellers under Section
1.2.3.

      "RBC DISAGREEMENT" has the meaning set forth in Section 2.2.4.

      "RBC NOTICE OF DISAGREEMENT" has the meaning set forth in Section 2.2.4.

      "REPRESENTATIVE" means, with respect to any Person, any manager, director,
officer, employee, lender, partner or agent, including any accountant,
consultant, banker, attorney or financial advisor, of such Person.

      "RESPONDENT" means a Party or Indemnitee against whom or which a Claim is
asserted by a Petitioner or Petitioners.

      "REVIEWABLE RETURNS" means Tax Returns for any taxable periods of the
Company ending (a) prior to the Closing Date which have not been filed as of the
Closing Date, and (b) on the Closing Date.

                                       10


      "SAP" means statutory accounting principles as codified by the National
Association of Insurance Commissioners subject to the exceptions therefrom
mandated by the DOI.

      "SECURITIES ACT" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.

      "SELLERS" means SMHS, CH, Linder, Cristea and Oswald, collectively, and
each of them is a "Seller."

      "SMHS" has the meaning set forth in the preface to the Agreement.

      "ST. JOHN'S MERCY PROVIDER AGREEMENT" means the Mercy CarePlus Hospital
Provider Agreement with St. John's Mercy Health System, a Missouri nonprofit
corporation d/b/a St. John's Mercy Medical Center (Creve Coeur, Missouri) and
St. John's Mercy Hospital (Washington, Missouri), dated as of July 1, 2006,
having a term expiring no sooner than June 30, 2010 on the same terms,
conditions and rates in effect on the Agreement Date except for annual rate
escalation negotiated between the parties thereto.

      "STANDARD ALLOCATION" means (a) 50.000% to SMHS, (b) 40.050% to CH; (c)
4.179% to Linder; (d) 3.781% to Cristea; and (e) 1.990% to Oswald.

      "STATE" means the State of Missouri.

      "STATE AGENCY" means the State of Missouri, Department of Social Services,
Division of Medical Services.

      "STATE HMO LAW" means Sections 354.600 through 354.636 of the Missouri
Revised Statutes, and any amendments thereto.

      "STRADDLE PERIOD RETURNS" has the meaning set forth in Section 6.5.4.

      "STRADDLE TAX PERIODS" has the meaning set forth in Section 6.5.4.

      "STUB PERIOD" has the meaning set forth in Section 6.5.4.

      "STUB PERIOD CALCULATION" has the meaning set forth in Section 6.5.4.

      "SUBLICENSE AGREEMENT" means the License Agreement made and entered into
as of June 1, 2006, by, among others, SMHS (as Licensor) and Company (as
Licensee).

      "TANGIBLE ASSETS" means the tangible personal property owned or leased by
Sellers, including all copy machines, computer-related equipment, portable or
otherwise, furniture, furnishings and consumable supplies.

      "TAX CLAIM" means any pending or threatened audit or assessment, suit,
proposed adjustment, deficiency, dispute, administrative or judicial proceeding
or other similar claim by a taxing authority related to Taxes.

                                       11


      "TAXES" means (a) all net income, gross income, gross receipts, sales,
use, ad valorem, franchise, profits, license, lease, service, service use,
withholding, employment, payroll, earnings, net worth, unemployment insurance,
Social Security, Medicare, excise, severance, transfer, value added,
documentary, mortgage, registration, stamp, occupation, real or personal
property, environmental, premium, property, windfall profits, customs, duties
and other taxes, fees, levies, assessments or charges of any kind whatsoever,
together with any interest, penalties, fines and other additions with respect
thereto, imposed by any Federal, state or local government, and (b) any
penalties, interest, fines or other additions to tax for the failure to collect,
withhold, file or pay over any of the foregoing, or to file any Tax Return which
is untrue, incorrect or incomplete. "Tax" means any one of the foregoing Taxes.

      "TAX RETURNS" means (a) all reports, declarations, filings,
questionnaires, estimates, returns, claims for refund, information statements
and similar documents relating to, or required to be filed in respect of, any
Taxes, including any schedule or attachment thereto and any amendments thereof,
and (b) any statements, returns, reports or similar documents required to be
filed pursuant to Part III of Subchapter A of Chapter 61 of the Code or pursuant
to any similar income, excise or other tax provision of Federal, state or local
law, including any amendments thereof. "Tax Return" means any one of the
foregoing Tax Returns.

      "TERRITORY" means (a) the State of Missouri, and (b) the Illinois counties
of Madison and St. Clair.

      "THIRD PARTY" means any Person other than a Party or an Affiliate of a
Party.

      "TRANSFER TAXES" means any sales, use, transfer, stamp, registration,
documentary, recording or similar Taxes, if any, together with any interest,
penalties, fines, costs, fees, additions to tax or additional amounts with
respect thereto, incurred in connection with the transactions contemplated by
this Agreement.

      "UNIT" means any of the Class A Units, Class B Units or Class C Units, and
collectively, they constitute the "Units."

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