Exhibit
2.1  EXECUTION
VERSION  PURCHASE
AGREEMENT  by and among  COVENTRY
HEALTH CARE, INC.  COVENTRY
MANAGEMENT SERVICES, INC.  FIRST
HEALTH GROUP CORP.  and  MAGELLAN
HEALTH SERVICES, INC.  June 4,
2009  i


TABLE OF CONTENTS  PageARTICLE
  1 DEFINED TERMS
  11.1
  Definitions
  11.2
  Terms
  Defined Elsewhere
  121.3
  Interpretation
  14ARTICLE
  2 PURCHASE AND SALE OF ASSETS AND STOCK
  152.1
  Sale
  of Assets
  152.2
  Excluded
  Assets
  152.3
  Sale
  of Stock and Interests
  152.4
  Purchase
  Price
  16ARTICLE
  3 WORKING CAPITAL ADJUSTMENT
  163.1
  Estimated
  Working Capital Adjustment
  163.2
  Post-Closing
  Working Capital Adjustments
  163.3
  Methodology
  for Working Capital Calculations
  19ARTICLE
  4 REPRESENTATIONS AND WARRANTIES OF THE SELLERS
  204.1
  Organization,
  Etc.
  204.2
  Corporate
  Authority; No Violation, Etc.
  204.3
  Ownership
  of Interests and Stock; Subsidiaries
  214.4
  Title
  to, Condition and Sufficiency of Assets
  224.5
  Financial
  Statements
  224.6
  Absence
  of Certain Changes or Events
  234.7
  Litigation;
  No Undisclosed Liabilities
  244.8
  Compliance
  with Laws
  244.9
  Environmental
  Matters
  244.10
  Tax
  Matters
  254.11
  ERISA
  and Employee Plans
  274.12
  Labor
  and Employment Matters
  284.13
  Intellectual
  Property
  294.14
  Material
  Contracts
  32  ii


TABLE OF CONTENTS  Page4.15
  Insurance
  344.16
  Payments
  to Employees
  344.17
  Permits
  354.18
  Brokers
  or Finders
  354.19
  Related
  Party Transactions
  354.20
  Banks;
  Power of Attorney
  364.21
  Certain
  Payments
  364.22
  Health
  Care Regulatory Compliance
  364.23
  Customers
  and Suppliers
  38ARTICLE
  5 REPRESENTATIONS AND WARRANTIES OF BUYER
  385.1
  Organization
  385.2
  Corporate
  Authority; No Violation, Etc.
  385.3
  Actions;
  Litigation
  395.4
  Solvency
  395.5
  Financing
  395.6
  Purchase
  for Own Account; Accredited Investor
  405.7
  [Reserved]
  405.8
  Brokers
  or Finders
  40ARTICLE
  6 COVENANTS
  406.1
  Conduct
  of the Business in the Ordinary Course Pending the Closing
  406.2
  Access
  to Information Pre-Closing
  446.3
  Access
  to Information Post-Closing
  456.4
  Notification
  of Certain Matters
  456.5
  Governmental
  Consents
  466.6
  Consents
  and Third Party Notices
  476.7
  Reasonable
  Efforts; Further Assurances
  476.8
  Investigation and Agreement; No
  Other Representations or Warranties
  486.9
  Indebtedness
  48  iii


TABLE OF CONTENTS  Page6.10
  Release
  of Guarantees and Letters of Credit
  486.11
  Termination
  of Intercompany Agreements
  496.12
  Post-closing
  Indemnification of Directors and Officers
  496.13
  Audited
  Financial Statements
  496.14
  Transaction
  Agreements
  50ARTICLE
  7 ADDITIONAL AGREEMENTS
  507.1
  WARN
  507.2
  Employee
  Matters and Employee Benefits
  507.3
  Covenants
  Not to Compete
  527.4
  [Reserved]
  537.5
  [Reserved]
  537.6
  Confidential
  Nature of Information
  537.7
  Acquisition
  Proposals
  547.8
  Release
  for Pre-closing Intercompany Liabilities
  547.9
  Securities
  54ARTICLE
  8 TAX MATTERS
  548.1
  Tax
  Indemnification
  548.2
  Transfer
  Taxes and Property Taxes on Acquired Assets
  578.3
  Tax
  Claims; Cooperation on Tax Matters
  588.4
  Termination
  of Tax Sharing Agreements
  598.5
  Election
  598.6
  Tax
  Treatment of Payments
  598.7
  Exclusivity;
  Survival
  59ARTICLE
  9 CLOSING
  609.1
  Time
  and Place of Closing
  609.2
  Deliveries
  by Sellers at Closing
  609.3
  Deliveries
  by Buyer at Closing
  61ARTICLE
  10 CONDITIONS PRECEDENT
  6110.1
  Conditions to Each Partys Obligation
  61  iv


TABLE OF CONTENTS  Page10.2
  Conditions
  to Obligation of Buyer
  6210.3
  Conditions
  to Obligations of Sellers
  6410.4
  Frustration
  of Closing Conditions
  64ARTICLE
  11 TERMINATION, AMENDMENT AND WAIVER
  6411.1
  Termination
  6411.2
  Effect
  of Termination
  66ARTICLE
  12 INDEMNIFICATION
  6612.1
  Survival
  6612.2
  Indemnification
  by the Parties
  6712.3
  Limits
  on Indemnification
  6812.4
  Matters
  Involving Third Parties
  7012.5
  Indemnification
  Notices
  7112.6
  Releases
  72ARTICLE
  13 MISCELLANEOUS
  7213.1
  Public
  Announcement
  7213.2
  Payment
  of Costs and Expenses
  7313.3
  Non-Assignment; Successors and
  Assigns
  7313.4
  Entire
  Agreement
  7313.5
  Severability;
  Enforceability
  7313.6
  Counterparts
  7313.7
  Notices
  7313.8
  Waiver
  7513.9
  Third
  Parties
  7513.10
  Rules of
  Construction
  7513.11
  Governing
  Law
  7613.12
  Non-Recourse
  7613.13
  Specific Performance
  76  v


PURCHASE
AGREEMENT  THIS
PURCHASE AGREEMENT, is made as of the 4th day of June, 2009, by and among
Magellan Health Services, Inc., a Delaware corporation (Buyer), Coventry Health Care, Inc.,
a Delaware corporation (Coventry),
First Health Group Corp., a Delaware corporation and a wholly-owned subsidiary
of Coventry (First Health Group) and
Coventry Management Services, Inc., a Pennsylvania corporation and a
wholly-owned subsidiary of Coventry (CMS).  Buyer, Coventry, First Health Group and CMS
are referred to collectively herein as the Parties
and each individually as a Party.  Each capitalized term used but not otherwise
defined herein shall have the meaning set forth in Article I.  RECITALS  WHEREAS,
CMS owns the Acquired Assets;  WHEREAS,
(i) First Health Group owns all of the issued and outstanding stock (the FHS Stock) of First Health
Services Corporation, a Virginia corporation (FHS);
(ii) First Health Group owns all of the issued and outstanding stock (the FHC Stock) of FHC, Inc., a Canadian
corporation (FHC); and (iii) Coventry
owns all of the issued and outstanding ownership interests (the Provider Synergies Interests) in
Provider Synergies, LLC, an Ohio limited liability company (Provider Synergies). For purposes
of this Agreement, the FHS Stock, the FHC Stock and the Provider Synergies
Interests are collectively referred to herein as the Shares;  WHEREAS,
FHS of Florida and FHS of Montana are each direct, wholly-owned subsidiaries of
FHS; and  WHEREAS,
subject to the terms and conditions set forth herein, (i) CMS desires to
sell, and Buyer desires to acquire, all of CMSs right, title and interest in
and to the Acquired Assets; (ii) First Health Group desires to sell, and
Buyer desires to acquire, all of the FHS Stock and the FHC Stock; and (iii) Coventry
desires to sell, and Buyer desires to acquire, all of the Provider Synergies
Interests.  NOW,
THEREFORE, in consideration of the respective representations, warranties,
agreements, and conditions hereinafter set forth, and other good and valuable
consideration, the sufficiency of which is hereby acknowledged, the Parties
hereto agree as follows:  ARTICLE 1  DEFINED TERMS   1.1           Definitions.  The following terms used in this Agreement
shall have the meanings indicated below unless the context otherwise indicates:


Acquire shall mean as the result
of, or in connection with, any cash tender or exchange offer, merger or other
business combination or sales of assets or any combination of the foregoing
transactions, more than a majority of the combined voting power of the then
outstanding securities of Coventry or any successor corporation or entity
entitled to vote generally in the election of the directors of Coventry or such
other corporation or entity after such transactions is held in the aggregate by
the holders of Coventrys securities entitled to vote generally in the election
of directors of Coventry immediately prior to such transaction.  Acquired Assets shall mean those
assets of CMS relating to the Business set forth on Section 1.1(a) of
the Seller Disclosure Letter and, without limiting anything set forth on Section 1.1(a) of
the Seller Disclosure Letter, shall include: 
(A) to the extent such assets are not owned by any Acquired Entity,
all tangible personal property, including any Furniture and Equipment, that is
located, or in the ordinary course of conduct of the Business would be located,
on the premises relating to the Leased Real Property and (B) all data
relating to business with customers or suppliers of the Business in the
possession or control of CMS.  The
Parties acknowledge and agree that Section 1.1(a) of the Seller
Disclosure Letter has been prepared as of June 4, 2009, and that Coventry
shall update such schedule periodically (but in no event later than five (5) days
prior to the Closing Date) to reflect any changes in the scheduled
Acquired Assets made in the operation of the Business after June 4, 2009,
provided that any such changes are made in compliance with Section 6.1 and
do not violate Section 4.4(e).  Acquired Entities shall mean,
collectively, FHS, Provider Synergies, FHC, FHS of Florida and FHS of Montana.  Action shall mean any action,
claim, proceeding, audit, hearing (including counterclaim), arbitration,
mediation, litigation or suit (whether civil, criminal, administrative,
investigative or informal) commenced, brought or heard by or before any
Governmental Authority, arbitrator or mediator (public or private).  Affiliate shall mean, with respect
to any specified Person, any other Person that, directly or indirectly,
controls, is controlled by or is under common control with, such specified
Person.  For purposes of this definition,
control (including, with
correlative meanings, the terms controlled by
and under common control with), as
used with respect to any Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
contract or otherwise.  Agreement shall mean this Purchase
Agreement, together with all exhibits attached hereto and the Disclosure
Letters.  Antitrust Division shall mean the
Antitrust Division of the United States Department of Justice.  2


Antitrust Laws shall mean,
collectively, (a) the HSR Act, (b) the Sherman Antitrust Act of 1890,
as amended, (c) the Clayton Act of 1914, as amended, (d) the Federal
Trade Commission Act of 1914, as amended and (e) any other Law designed to
prohibit, restrict or regulate actions for the purpose or effect of
monopolization or restraint of trade.  Business shall mean the business
and operations of the Acquired Entities as currently conducted.  Business Day shall mean any day
other than a Saturday, a Sunday or a day on which banks in New York, New York
are authorized or obligated by law or executive order to not open or remain
closed.  Business IP means all Intellectual
Property owned by any of the Acquired Entities.  Business Technology means all
Technology owned by any of the Acquired Entities.  Buyer Disclosure Letter shall mean
the Disclosure Letter prepared and delivered by Buyer to Sellers prior to the
execution of this Agreement.  Buyer Indemnifiable Losses shall
mean Losses Buyer Indemnitees may suffer, sustain or become subject to and be
entitled to indemnity against, pursuant to Article VIII or Article XII.  Buyer Material Adverse Effect
means any event, occurrence, fact, condition, change, development or effect that
materially and adversely affects Buyers ability to consummate the transactions
contemplated by this Agreement and the other Transaction Agreements.  Buyers Knowledge shall mean the
actual knowledge after due inquiry of the individuals listed in Section 1.1
of the Buyer Disclosure Letter.  Buyer shall have the meaning
assigned to such term in the Preamble hereto.  Capital Lease Indebtedness shall
mean all obligations of any of the Acquired Entities to pay rent or other
payment amounts under a lease of real or personal property which, if
outstanding on December 31, 2008, would be classified in accordance with
GAAP as a capital lease or a liability on the face of a balance sheet for such
Acquired Entity or CMS.  Cash shall mean, with respect to
any Person, all cash and cash equivalents (including stocks, bonds, debt
securities, certificates of deposit and similar investments that are marketable
securities and short term investments) of such Person.  3


Change in Control shall mean as
the result of, or in connection with, any cash tender or exchange offer, merger
or other business combination or sales of assets or any combination of the
foregoing transactions, less than a majority of the combined voting power of
the then outstanding securities of Coventry or any successor corporation or
entity entitled to vote generally in the election of the directors of Coventry
or such other corporation or entity after such transactions is held in the
aggregate by the holders of Coventrys securities entitled to vote generally in
the election of directors of Coventry immediately prior to such transaction.  CMS Group shall mean CMS (solely
with respect to the Acquired Assets) and the Acquired Entities.  Code shall mean the Internal
Revenue Code of 1986, as amended, and as the context requires, the Treasury
Regulations promulgated thereunder.  Commitments shall mean any
subscriptions, options, rights, warrants, convertible securities or other
agreements or commitments.  Confidentiality Agreement shall
mean the Confidentiality Agreement, dated October 12, 2007, as amended on March 23,
2009, and further amended on April 2, 2009, by and between Coventry and
Buyer.  Consent shall mean any approval,
consent, license, permit, ratification, waiver or other authorization issued,
granted, given, or otherwise made available by or under the authority of any
Governmental Authority or pursuant to any applicable Law.  Consolidated Group means an
affiliated, consolidated, combined or unitary group with respect to any Taxes.  Contract shall mean any loan or
credit agreement, note, bond, debenture, indenture, mortgage, guarantee, deed
of trust, lease, franchise, permit, authorization, license, contract,
instrument, employee benefit plan or practice or other binding agreement,
obligation, arrangement, understanding or commitment.  Coventry Group shall mean Coventry
and its Affiliates, excluding however, CMS (solely with respect to the Acquired
Assets) and the Acquired Entities.  Coventry Name shall mean the name Coventry,
First Health, and First Health Services, including all derivations thereof,
and any and all Intellectual Property rights relating to the foregoing and
shall include, without limitation, any uniform resource locators (or URLs) containing the name Coventry,
or any derivation thereof.  Designated Area shall mean
anywhere in the United States.  Disclosure Letters shall mean,
collectively, the Seller Disclosure Letter and the Buyer Disclosure Letter.  4


Eligible Employee shall mean any
individual who is an active employee, consultant, contingent worker, leased
employee or independent contractor of the CMS Group as of the date hereof,
together with such individual who is hired by the CMS Group after the date
hereof, and identified on Section 1.1(b) of the Seller Disclosure
Letter.  The Parties acknowledge and
agree Section 1.1(b) of the Seller Disclosure Letter has been
prepared as of June 4, 2009 and that Coventry shall update such schedule
periodically, but in no event later than five (5) days prior to the
Closing Date, to reflect any changes made in the operation of the Business
after June 4, 2009, provided, that any such change was made in
compliance with Section 6.1  Employee Plan shall mean any employee
benefit plan within the meaning of section 3(3) of ERISA and all other
employee benefit arrangements or payroll practices, including, without
limitation, any employment agreement, consulting agreement, bonus, incentive
compensation, deferred compensation, stock ownership, stock option, stock
appreciation right, restricted stock, phantom stock, equity, premium
conversion, medical, hospitalization, vision, dental, health, life, disability,
severance, change of control, vacation, death benefit, educational, adoption,
dependent care assistance or other employee benefit plan, policy, arrangement,
or agreement, whether or not subject to ERISA, that any of the Sellers, any of
the Acquired Entities, or any their respective ERISA Affiliates, sponsors,
maintains or contributes to for the benefit of current or former employees,
consultants, or directors of any of the Sellers or ERISA Affiliates.  Environmental Laws shall mean any
Law now or hereinafter in effect, relating to pollution or the protection,
cleanup or restoration of the environment and natural resources, and health and
safety (as it relates to exposure to Hazardous Materials) including the Federal
Clean Air Act, the Federal Clean Water Act, the Federal Resource Conservation
and Recovery Act, the Federal Comprehensive Environmental Response,
Compensation, and Liability Act, the Federal Toxic Substances Control Act, the
Federal Occupational Safety and Health Act (as it relates to exposure to Hazardous
Materials) and the Hazardous Materials Transportation Act.  ERISA shall mean the Employee
Retirement Income Security Act of 1974, as amended.  ERISA Affiliate shall mean any
trade or business, affiliate or subsidiary of any of the Sellers, that is or
has been under common control or that is or has ever been treated as a single
employer with any of them under sections 414(b), (c), (m) or (o) of
the Code.  FHS of Florida shall mean First
Health Services of Florida, Inc.  FHS of Montana shall mean First
Health Services of Montana, Inc.  FHS Outstanding Indebtedness shall
mean, as of any particular time, the unpaid principal amount, accrued interest,
prepayment and redemption premiums or penalties (if any), unpaid fees and
expenses or other monetary obligations in respect of all  5


indebtedness of the Acquired Entities for borrowed
money, but specifically excluding all Capital Lease Indebtedness of the
Acquired Entities.  FHS Target Working Capital shall
mean $15,000,000.  FHS Working Capital shall be in
the amount by which the current assets of the Acquired Entities (provided,
that, current assets shall not include FHS Intercompany Receivables) exceeds
the current liabilities of the Acquired Entities (provided, that, current
liabilities shall not include (i) Intercompany Payables and (ii) any
FHS Outstanding Indebtedness).  For
purposes of Article III, FHS Working Capital shall be determined as of
immediately prior to the Closing and shall not be calculated to include any
changes in assets or liabilities as a result of purchase accounting adjustments
or other changes arising from or resulting as a consequence of the
Transactions.  FTC shall mean the United States
Federal Trade Commission.  Furniture and Equipment means all
furniture, fixtures, furnishings, equipment, vehicles, leasehold improvements,
and other tangible personal property owned or used by the Acquired Entities in
the conduct of the Business, including all desks, chairs, tables, hardware,
copiers, telephone equipment and lines, telecopy machines and other
telecommunication equipment, networks, hubs and switches, cubicles and
miscellaneous office furnishings and supplies.  GAAP shall mean United States
generally accepted accounting principles as set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board.  Governmental Authority shall mean
any foreign, federal, provincial, state or local government court,
administrative or regulatory agency, board, bureau or commission or other
governmental department or authority or instrumentality thereof.  Governmental Program shall mean federal
health care programs as defined in 42 U.S.C. § 1320a-7b(f).  Guarantees shall mean shall mean
all guarantees, endorsements, performance bonds, surety bonds, bid bonds or
other similar agreements relating to the Business.  Handling shall mean the
production, use, generation, storage, treatment, transportation, recycling, or
other management of any Hazardous Material.  Hazardous Material shall mean any
substance, material or waste that is regulated, classified, or otherwise
characterized under or pursuant to any Environmental Law as hazardous, toxic,
pollutant, contaminant,
or radioactive, including petroleum
and its by-products, asbestos, polychlorinated biphenyls and radon.  6


Healthcare Laws means any Law
relating to the provision, administration, and/or payment for healthcare or
healthcare-related products or services, including, without limitation, to the
extent applicable:  (i) rules and
regulations governing the operation and administration of Medicare, Medicaid,
or other federal and state health care programs; (ii) 42 U.S.C. §
1320a-7b(b), commonly referred to as the Federal Anti-Kickback Statute, (iii) 31
U.S.C. §§ 3729 et seq., commonly referred to as the False Claims Act, (iv) 31
U.S.C. § 3801 et seq., commonly referred to as the Program Fraud Civil
Penalties Act, (v) the rules and regulations of the U.S. Food and
Drug Administration, and (vi) rules and regulations of the state
boards of pharmacy.  HSR Act shall mean the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended.  Intellectual Property shall mean
all U.S., foreign and state issuances, registrations and applications for, and
all rights (common law, statutory or otherwise) throughout the world in, intellectual
property, including all (a) trademarks, service marks, trade names, logos,
common law trademarks and service marks, domain names and any applications,
renewals and extensions therefor, (b) patents, provisional patents and
utility models and applications therefor, all reissues, divisions,
re-examinations, renewals, extensions, substitutions, continuations and
continuations in part thereof, and equivalent or similar rights anywhere in the
world in inventions and discoveries, including invention disclosures, invention
certificates, and the like (Patents), (c) trade
secrets and other rights in privacy, data, know-how and confidential or
proprietary information, (d) copyrights, database rights, mask work
rights, works of authorship and other rights corresponding thereto, and all
registrations, applications, renewals, extensions and reversions thereof, (e) unregistered
design rights and registered industrial designs and any registrations,
applications, renewals and extensions therefor, (f) Moral Rights, (g) computer
programs, algorithms, routines, source code and executable code, whether
embodied in firmware, software or otherwise, documentation, designs, files,
records and data (Software),
(h) the content of websites and Software related thereto; (i) inventions
(whether or not patentable and whether or not reduced to practice), research
and development, discoveries, improvements and technology, (j) proprietary
and confidential information, including technical data, customer and supplier
lists and data, trade secrets, know-how and techniques, (k) databases,
data compilations and collections and technical data, tools, methods,
processes, devices, prototypes, schematics, bread boards, net lists, mask
works, test methodologies and hardware and Software development tools and (l) any
similar, corresponding or equivalent rights to any of the foregoing.  Intercompany Agreements shall mean
the Contracts between one or more members of the Coventry Group, on the one
hand, and one or more members of the CMS Group, on the other hand, that are set
forth on Section 1.1(c) of the Seller Disclosure Letter.  Intercompany Payables shall mean
all payables and notes payable of any one or more members of the CMS Group
owing to any one or more members of the Coventry  7


Group, whether or not billed or accrued or recorded or
unrecorded, together with any unpaid interest or fees accrued thereon or other
amounts due with respect thereto.  Intercompany Receivables shall
mean all accounts, accounts receivable and notes receivable held by any one or
more members of the CMS Group that are owed by any one or more members of the
Coventry Group, whether or not billed or accrued or recorded or unrecorded,
together with any unpaid interest or fees accrued thereon or other amounts due
with respect thereto.  IRS shall mean the United States
Internal Revenue Service.  Law means any foreign, federal,
state or local law, statute, code, ordinance, rule, regulation or Ruling.  Leased Real Property shall mean
all real property leased, subleased or licensed to the Acquired Entities.  Letters of Credit shall mean the
letters of credit, bankers acceptances and similar facilities issued by or on
behalf of any one or more members of the Coventry Group in connection with the
Business.  Lien shall mean any lien, pledge
(including any negative pledge), purchase option, easement, restrictive
covenant, security interest, deed of trust, mortgage, conditional sales
agreement, right of first refusal, servitude, proxy, voting trust or agreement,
transfer restriction under any shareholder or similar agreement, registration
rights with respect to securities, encumbrance or other right of third parties
voluntarily incurred or arising by operation of Law, or any other restriction
or limitation whatsoever, including any agreement to give any of the foregoing
in the future, and any contingent sale or other title retention agreement or
lease in the nature thereof, including any lien resulting from the FHS Outstanding
Indebtedness.  Losses means any and all claims,
demands, suits, proceedings, judgments, losses, liabilities, damages, Taxes,
interest, fines, penalties, assessments, awards and costs and expenses of every
kind and nature (including reasonable attorneys and other professionals fees
and court costs) incurred in responding to claims, demands, assessments, awards
or investigations or defending suits or proceedings, whether or not involving a
third party claim; provided, however, that in computing the
amount of any Losses of an Indemnified Party, for purposes of determining the
liability of the Indemnifying Party under Article VIII or Article XII,
(a) the amount of any insurance proceeds or other recoveries actually
received by the Indemnified Party shall be deducted from such Losses, (b) the
amount of any Tax benefit actually used to reduce Taxes by any Indemnified
Party arising from the incurrence or payment of any such Losses shall be
deducted from such Losses, and (c) other than Losses resulting from Third
Party Claims, the amount of any Losses in the form of exemplary or punitive
Losses shall not be included in Losses for which an Indemnified Party may seek
indemnification under Article VIII or Article XII.  In computing the amount of any such Tax
benefit, the  8


Indemnified Party shall be deemed to utilize all Tax
items arising from the incurrence or payments of any Losses after all other Tax
items of such Person have been accounted for and utilized.  Material Adverse Effect on the Business
means any event, occurrence, fact, condition, change, development or effect
that, individually or in the aggregate with all other events, occurrences,
facts, conditions, changes, developments or effects, is, or would reasonably be
expected to be, materially adverse to the business, assets, liabilities,
results of operations or condition (financial or otherwise) of the Business,
taken as a whole, except to the extent that such event, occurrence, fact,
condition, change, development or effect results from: (a) any generally
applicable change in GAAP or interpretation thereof, (b) any adoption,
implementation, promulgation, repeal, modification, reinterpretation or
proposal of any Law after the date hereof, (c) (i) the announcement
of this Agreement, or (ii) the pendency of the consummation of the
transactions contemplated hereby, (d) actions or inactions taken by CMS,
or the Acquired Entities as expressly required by this Agreement, (e) economic,
political or financial market conditions generally affecting the industries in
which CMS or the Acquired Entities conduct the Business, or the U.S. economy as
a whole or the capital markets in general, and (f) any outbreak or
escalation of hostilities (including, without limitation, any declaration of
war by the U.S. Congress) or acts of terrorism, provided, in the case of
clauses (a), (e) and (f), that such events, occurrences, facts,
conditions, changes, developments or effects do not disproportionately affect
the Business relative to others in the industries in which the Acquired
Entities operate.  Moral Rights shall mean any right
to claim authorship to or to object to any distortion, mutilation or other
modification or other derogatory action in relation to a work of authorship,
whether or not such claim or objection would be prejudicial to the authors
reputation, and any similar right existing under common or statutory law of any
country in the world or under any treaty, regardless of whether or not such
right is denominated or generally referred to as a moral right.  Off-the-Shelf Software shall mean
Software that is not customized for any of the Acquired Entities or CMS or that
is generally available on reasonable terms through commercial distributors or
in retail stores.  ordinary course of business shall
mean the ordinary and usual course of normal day-to-day operations of the
Business as conducted by Sellers, through the date hereof, consistent with past
practice.  Patents shall have the meaning
specified in the definition of Intellectual Property.  Permits shall mean any licenses,
franchises, certificates, approvals, permits, consents, waivers and other
authorizations issued, granted, given or otherwise made available by or under
the authority of any Governmental Authority.  9


Permitted Liens shall mean all (i) Liens
consisting of zoning or planning regulations, easements, permits and other
restrictions or limitations on the use of real property or irregularities in
title thereto that do not materially detract from the value of, or impair the
use of, property as it is presently used in connection with the Business,
provided that such regulations have not been violated, (ii) Liens for
current Taxes, assessments or governmental charges or levies on property not
yet due or that are being contested in good faith and for which appropriate
reserves have been created, (iii) mechanics, materialmens and similar
Liens arising in the ordinary course of business or by operation of Law for
sums not yet due or that are being contested in good faith that are not
material to the Business and that are not resulting from a breach, default or
violation by Sellers or any of the Subsidiaries of any Contract or Law; (iv) Liens
securing all or any portion of the FHS Outstanding Indebtedness that are
released at Closing, (v) Liens on Leased Real Property arising from the
provisions of such leases, (vi) mortgages, deeds of trust and other
security instruments, and ground leases or underlying leases covering the
title, interest or estate of landlords with respect to the Leased Real Property
and to which the leases with respect to the Leased Real Property are
subordinate, (vii) Liens for Capital Lease Indebtedness, (viii) Liens
set forth on Section 1.1(d) of the Seller Disclosure Letter that are
to be released at or prior to the Closing in accordance with Section 9.2(d),
and (ix) Liens for Guarantees or Letters of Credit (in each case, to the
extent they have not been extinguished or released prior to or at Closing).  Person shall mean a natural
person, corporation, limited liability company, partnership, limited
partnership or other entity, including a Governmental Authority.  Pre-Closing Tax Period shall mean
any Taxable period that ends on or prior to the Closing Date.  Release or Released
shall mean any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, dumping, migrating or disposing
(including abandoning or discarding).  Ruling means any award, decision,
injunction, decree, stipulation, determination, writ, judgment, order, ruling,
assessment or arbitration award, subpoena or verdict entered, issued, made or
rendered (whether temporary, preliminary or permanent) by any court,
administrative agency or other Governmental Authority or arbitrator.  SEC shall mean the U.S. Securities
and Exchange Commission.  Securities Act shall mean the
Securities Act of 1933, as amended, together with the rules and
regulations of the SEC promulgated thereunder.  Seller Disclosure Letter shall
mean the Disclosure Letter prepared and delivered by Coventry to Buyer prior to
the execution of this Agreement.  Sellers Knowledge shall mean the
actual knowledge after due inquiry of the individuals listed in Section 1.1(e) of
the Seller Disclosure Letter.  10


Sellers shall mean, collectively,
Coventry, CMS and First Health Group.  Software shall have the meaning
specified in the definition of Intellectual Property.  Straddle Period shall mean any
Taxable period that begins on or before and ends after the Closing Date.  Subsidiaries shall mean, with
respect to any Person, another Person (a) of which 50% or more of the
capital stock, voting securities, other voting ownership or voting partnership
interests having voting power under ordinary circumstances to elect directors
or similar members of the governing body of such corporation or other entity
(or, if there are no such voting interests, 50% or more of the equity
interests) are owned or controlled, directly or indirectly, by such first
Person or (b) of which such first Person is a general partner.  Tax or Taxes
shall mean (i) all taxes, charges, fees, levies or other assessments,
including all net income, gross income, gross receipts, sales, use, ad valorem,
transfer, franchise, profits, premiums, license, withholding, payroll,
employment, social security, unemployment, excise, estimated, severance, stamp,
occupation, property or other taxes, customs duties, fees, assessments or
charges of any kind whatsoever, including all interest and penalties thereon,
and additions to tax or additional amounts imposed by any Governmental
Authority, and (ii) all liabilities in respect of any items described in
clause (i) payable by reason of contract or arrangement, assumption,
transferee or successor liability, operation of Law or Treasury Regulations Section 1.1502-6(a) (or
any predecessor or successor thereof or any analogous or similar provision of
Law).  Taxing Authority shall mean the
United States, any subdivision or instrumentality thereof or any other Governmental
Authority, which imposes Taxes.  Tax Return shall mean any return,
report, declaration, form, claim for refund or information return or statement
relating to Taxes, including any schedule or attachment thereto, and including
any amendment thereof.  Technology means all Software,
information, designs, libraries, formulae, procedures, methods, techniques,
ideas, know-how, research and development, technical data, programs,
subroutines, tools, materials, specifications, processes, inventions (whether
or not patentable and whether or not reduced to practice), apparatus,
creations, improvements and other similar materials, and all recordings,
graphs, drawings, reports, analyses, and other writings, and other tangible
embodiments of the foregoing, in any form whether or not specifically listed
herein.  Transaction Agreements shall mean
this Agreement, the Confidentiality Agreement, the Transition Services
Agreement, the Master Services Agreement for Radiology Benefit Management
Services entered into simultaneously herewith by and  11


among Buyer and certain Subsidiaries of Sellers named
therein and dated the date hereof (the Master Radiology Services
Agreement), the Management Services Agreement for Medical
Pharmaceuticals entered into simultaneously herewith by and between Buyer and
certain Subsidiaries of Sellers named therein and dated the date hereof (the Medical Pharmaceuticals Agreement),
the radiology benefits management agreements to be entered into between
National Imaging Associates Inc. and Coventry and/or its Subsidiaries as
provided by the Master Radiology Services Agreement and any other agreements
that any Seller or any of its Subsidiaries and Buyer or any of its Subsidiaries
agree to enter into in connection with this Agreement or the Closing.  Transactions shall mean the
transactions contemplated by this Agreement and the other Transaction
Agreements.  Transition Services Agreement
shall mean the Transition Services Agreement entered into simultaneously
herewith between CMS and Buyer dated as of the date hereof.  Treasury Regulations shall mean
the regulations promulgated by the Treasury pursuant to and in respect of
provisions of the Code. All references in this Agreement to sections of the
Treasury Regulations shall include any corresponding provisions of succeeding,
similar, substitute proposed or final Treasury Regulations.  Treasury shall mean the United
States Department of Treasury.  WARN Act shall mean the Worker
Adjustment and Retraining Notification Act, as amended and other similar Laws.  1.2Terms Defined Elsewhere. 
The following is a list of additional terms used in this Agreement and a
reference to the Section hereof in which such term is defined:  Term
  
  SectionAcquisition Proposal
  
  Section 7.7(a)ARRA
  
  Section 4.11(g)Audited Financial
  Statements
  
  Section 6.13Auditors Consent
  
  Section 6.13Bankruptcy and Equity
  Exception
  
  Section 4.2(a)Buyer
  
  PreambleBusiness Software
  
  Section 4.13(i)Buyer Indemnitees
  
  Section 12.2(a)Cap
  
  Section 12.3(c)(i)Calculation Notice
  
  Section 3.2(b)Change In Control
  Customer Contracts
  
  Section 4.14(d)Closing
  
  Section 9.1Closing Date
  
  Section 9.1Closing Date Interest
  Rate
  
  Section 3.2(d)  12


Term
  
  SectionCMS
  
  PreambleCMS Group Charter
  Documents
  
  Section 4.1(b)CMS Group Release
  
  Section 7.8COBRA
  
  Section 4.11(g)Coventry
  
  PreambleCure Period
  
  Section 11.1(b)Deductible
  
  Section 12.3(a)Disputed Items
  
  Section 3.2(b)D&O Obligations
  
  Section 6.12D&O Released
  Parties
  
  Section 12.6Excluded Assets
  
  Section 2.2(a)FHC
  
  RecitalsFHC Stock
  
  RecitalsFHS
  
  RecitalsFHS Closing Date
  Balance Sheet
  
  Section 3.2(a)FHS Closing Date
  Payment
  
  Section 2.4(a)FHS Estimated Working
  Capital
  
  Section 3.1(a)FHS Financial
  Statements
  
  Section 4.5(a)FHS Initial Calculation
  
  Section 3.2(a)FHS Interim Financial
  Statements
  
  Section 4.5(a)FHS Material Permits
  
  Section 4.17FHS Negative Estimated
  Working Capital Adjustment
  
  Section 3.1(a)FHS Positive Estimated
  Working Capital Adjustment
  
  Section 3.1(a)FHS Restricted Business
  
  Section 7.3(a)FHS Stock
  
  RecitalsFHS Working Capital
  Adjustment Amount
  
  Section 3.2(d)FHS Year End Financial
  Statements
  
  Section 4.5(a)Final FHS Working
  Capital
  
  Section 3.2(d)FIRPTA Affidavit
  
  Section 9.2(l)First Health Group
  
  PreambleForeign Plans
  
  Section 4.11(h)Fundamental
  Representations
  
  Section 12.1(a)Governmental Damages
  
  Section 10.2(e)Governmental
  Investigation
  
  Section 10.2(e)HIPAA
  
  Section 4.11(g)Hired Employees
  
  Section 7.2(b)(i)HSR Filing
  
  Section 6.5(b)Indemnifiable Losses
  
  Section 12.2(b)Indemnification Notice
  
  Section 12.5(a)Indemnified Party
  
  Section 12.2(c)Infringes
  
  Section 4.13(b)  13


Term
  
  SectionInjunctions
  
  Section 10.1(b)Labor Union
  
  Section 4.12(a)Legal Actions
  
  Section 10.1(c)Loss of Profits
  
  Section 12.3(f)Material Contract
  
  Section 4.14(b)Party or Parties
  
  PreamblePolicies
  
  Section 4.15Property Taxes
  
  Section 8.2(b)(i)Provider Synergies
  
  RecitalsProvider Synergies
  Interests
  
  RecitalsPurchase Price
  
  Section 2.4(a)Re-Calculated FHS
  Working Capital
  
  Section 3.2(e)Re-Calculated FHS
  Working Capital Adjustment Amount
  
  Section 3.2(e)Registered IP
  
  Section 4.13(a)Related Persons
  
  Section 4.19Releasing Parties
  
  Section 12.6Restraints
  
  Section 10.1(c)Seller Indemnifiable
  Losses
  
  Section 12.2(b)Seller Indemnitees
  
  Section 12.2(b)Settlement Firm
  
  Section 3.2(c)Shares
  
  RecitalsTax Claim
  
  Section 8.3(a)Tax Return Notice
  
  Section 8.1(b)(i)Tax Settlement Firm
  
  Section 8.1(b)(i)Termination Date
  
  Section 11.1(e)(i)Third Party Claim
  
  Section 12.4(a)Transfer Taxes
  
  Section 8.2(a)Unsold Securities
  
  Section 7.9  1.3Interpretation. 
In this Agreement, unless otherwise specified or where the context
otherwise requires:  (a)the headings of particular provisions of
this Agreement are inserted for convenience only and will not be construed as a
part of this Agreement or serve as a limitation or expansion on the scope of
any term or provision of this Agreement;  (b)words importing any gender shall include
other genders;  (c)words importing the singular only shall
include the plural and vice versa;  14


(d)the words include, includes or including
shall be deemed to be followed by the words without limitation;  (e)the words hereof, hereto, herein
and herewith and words of similar import shall, unless otherwise stated, be
construed to refer to this Agreement as a whole and not to any particular
provision of this Agreement;  (f)references to Articles, Exhibits, Sections
and other subdivisions shall be to Articles, Exhibits, Sections and other
subdivisions of or to this Agreement; and  (g)references to any Person include the
successors and permitted assigns of such Person.  ARTICLE 2
PURCHASE AND SALE OF ASSETS AND STOCK  2.1Sale of Assets. 
Upon the terms and conditions set forth herein,  (a)Buyer agrees to purchase from CMS, and
CMS agrees to sell, transfer, assign, convey and deliver to Buyer, all of CMS
right, title and interest in, to and under the Acquired Assets, free and clear
of all Liens, other than Permitted Liens.  2.2Excluded Assets.  (a)Excluded Assets. 
Notwithstanding Section 2.1 of this Agreement, CMS is not selling,
and Buyer is not purchasing, pursuant to this Agreement, any assets,
properties, rights, licenses, Contracts, real property, causes of action or
businesses of any kind or description, wherever located, real, personal or
mixed, tangible or intangible, owned by, leased by, granted to or in the
possession of CMS, that is not an Acquired Asset, all of which shall be
retained by CMS; provided further that Sellers are not selling and Buyer is not
purchasing any right, title or interest to the Coventry Name (collectively, the
Excluded Assets).  2.3Sale of Stock and Interests. 
Upon the terms and conditions set forth herein, at the Closing:  (a)Buyer agrees to purchase from First
Health Group, and First Health Group agrees to sell, transfer, assign, convey
and deliver to Buyer, all of the FHS Stock and FHC Stock, free and clear of all
Liens; and  (b)Buyer agrees to purchase from Coventry,
and Coventry agrees to sell, transfer, assign, convey and deliver to Buyer, all
of the Provider Synergies Interests, free and clear of all Liens.  15


2.4Purchase Price.  (a)Subject to Article XII, the
aggregate cash purchase price payable by Buyer in consideration of the sale and
transfer of the Acquired Assets, FHS Stock, FHC Stock and Provider Synergies
Interests (the Purchase Price)
shall be an amount in cash equal to the sum of the FHS Closing Date Payment
plus, if applicable, any adjustments made pursuant to Section 3.2.  The FHS Closing Date Payment
shall be an amount equal to the sum of (a) $110,000,000, plus, if applicable,
(b) the FHS Positive Estimated Working Capital Adjustment and minus, if
applicable, (c) the FHS Negative Estimated Working Capital Adjustment.  (b)In calculating the various respective
adjustments to the Purchase Price under this Agreement, no single item shall be
given duplicative effect.  ARTICLE 3  WORKING CAPITAL
ADJUSTMENT  3.1Estimated Working Capital Adjustment.  (a)No later than two Business Days prior to
the Closing Date, Coventry shall deliver to Buyer a statement showing the
calculation of an estimate of the FHS Working Capital as of immediately prior
to the Closing (the FHS Estimated Working
Capital).  The amount, if
any, by which the FHS Estimated Working Capital exceeds the FHS Target Working
Capital is referred to herein as the FHS Positive Estimated
Working Capital Adjustment, and the amount, if any, by which
the FHS Target Working Capital exceeds the FHS Estimated Working Capital is
referred to herein as the FHS Negative Estimated
Working Capital Adjustment.  (b)Coventrys calculation of the FHS
Estimated Working Capital as delivered to Buyer shall be accompanied by such
schedules and data as may be necessary to support such calculation.  3.2Post-Closing Working Capital Adjustments.  (a)Buyer shall cause to be prepared and, as
soon as practical, but in no event later than 180 days after the Closing Date,
shall cause to be delivered to Coventry, the unaudited combined balance sheet
of the Acquired Entities prepared as of immediately prior to the Closing (the FHS Closing Date Balance Sheet)
and a statement showing the calculation of the FHS Working Capital as of
immediately prior to the Closing (the FHS Initial Calculation).  The FHS Closing Date Balance Sheet and the
FHS Initial Calculation shall be accompanied by such schedules and data with
respect to the determination of the FHS Working Capital contained therein as
may be appropriate to support such FHS Initial Calculation.  16


(b)Within 45 days after delivery to Coventry
of the FHS Closing Date Balance Sheet and the FHS Initial Calculation by Buyer
pursuant to Section 3.2(a), Coventry may deliver to Buyer a written notice
(the Calculation Notice) either (A) advising
Buyer that Coventry agrees with and accepts the FHS Initial Calculation (as the
case may be) or (B) setting forth those particular line items (the Disputed Items) in the FHS Initial
Calculation that Coventry disputes and a statement, with reasonable detail as
to the Disputed Items, of what Coventry believes is the correct calculation of
each Disputed Item and of the FHS Working Capital as of immediately prior to
the Closing.  Coventry and the advisors
engaged by Coventry shall be entitled to review Buyers working papers, trial
balances and similar materials relating to its preparation of the FHS Closing
Date Balance Sheet for purposes of reviewing the FHS Initial Calculation.  In addition, Buyer shall also provide
Coventry and its accountants with (i) the reasonable assistance of
personnel and (ii) timely and reasonable access, during normal business
hours, to its personnel, properties, books and records, in each case at Buyers
expense, but only to the extent related to review by Coventry of such FHS
Initial Calculation.  If Coventry does
not submit a Calculation Notice within the 45-day period provided herein, then
the Initial Calculation shall become final, binding and conclusive on the
Parties and shall not be subject to further review, challenge or
adjustment.  To the extent that Coventry
timely provides a Calculation Notice within the 45-day period, all items
reflected therein that are not Disputed Items shall become final, binding and
conclusive on the Parties and shall not be subject to further review, challenge
or adjustment.  (c)Buyer and Coventry shall use commercially
reasonable efforts for a period of 30 days (or such longer period as they may
mutually agree) after the date of Coventrys objection to the Calculation
Notice to resolve any Disputed Items. 
During such 30-day period (or such longer period as they may mutually
agree), Buyer and Coventry shall have access to the working papers, trial
balances, schedules and calculations of the other used in the preparation of
the FHS Initial Calculation, the Calculation Notice and the determination of the
FHS Working Capital contained therein and the Disputed Items.  In the event that Buyer and Coventry are
unable to resolve all Disputed Items within such 30-day period (or such longer
period as they may mutually agree), then the remaining unresolved Disputed
Items shall be referred to Deloitte and Touche LLP or such other nationally
recognized accounting firm selected by mutual agreement of Buyer and Coventry
(such selected firm, the Settlement Firm).  Buyer and Coventry will promptly, and in no
event later than the time that Disputed Items are submitted to the Settlement
Firm, enter into reasonable and customary arrangements for the services to be
rendered by the Settlement Firm under this Section 3.2(c).  The Parties agree that the selection process
for the Settlement Firm shall occur only once and that such Settlement Firm,
once selected, shall resolve remaining unresolved Disputed Items.  The determination of the remaining unresolved
Disputed Items by the Settlement Firm shall be final, binding and conclusive
and shall constitute an arbitral award that is unappealable and not subject to
further review, challenge or adjustment and upon which a judgment may be
entered by a court having jurisdiction thereof. 
Buyer and Coventry shall use commercially reasonable efforts to cause
the Settlement Firm to reach a determination as promptly as practicable (and in
any event within 30 days from the date  17


that the Disputed Items are submitted to it).  Within 10 days after the Settlement Firm has
been retained, Buyer and Coventry shall furnish, at their own expense, to the
Settlement Firm and each other a written statement of their position with
respect to each Disputed Item.  Within
five Business Days after the expiration of such 10-day period, Buyer and
Coventry may deliver to the Settlement Firm and to each other its response to
the others position on each Disputed Item. 
With each submission, Buyer and Coventry may also furnish to the
Settlement Firm such information, workpapers and other documents as they deem
relevant to the resolution of the Disputed Items, with appropriate copies or
notification being given to the other. 
In addition, Buyer and Coventry shall each furnish the Settlement Firm
such workpapers and other documents and information relating to the Disputed
Items, and shall provide interviews and answer questions, as such Settlement
Firm may reasonably request.  The
Settlement Firm may, at its discretion, conduct a conference concerning the
disagreement with Buyer and Coventry, at which conference Buyer and Coventry
shall each have the right to present additional documents, materials and other
information and to have present its advisors, counsel and accountants. The
fees, costs and expenses of the Settlement Firm shall be allocated to and borne
by Coventry and Buyer based on the inverse of the percentage that the
Settlement Firms determination (before such allocation) bears to the total
amount of the Disputed Items as originally submitted to the Settlement
Firm.  For example, should the items in
dispute total in amount to $1,000 and the Settlement Firm awards $600 in favor
of Coventrys position, 60% of the costs of its review would be borne by Buyer
and 40% of the costs would be borne by Coventry.  (d)The FHS Working Capital
Adjustment Amount, which may be a positive or negative amount,
shall mean the amount equal to the FHS Working Capital, as finally determined
in accordance with Sections 3.2(a), 3.2(b) and 3.2(c) (the Final FHS Working Capital), minus
the FHS Estimated Working Capital.  If
the FHS Working Capital Adjustment Amount is a positive amount, then Buyer
shall promptly deliver, by wire transfer of immediately available funds to an
account or accounts designated in writing by Coventry, an amount equal to the
FHS Working Capital Adjustment Amount, together with interest thereon from the
Closing Date to the date of payment at the rate equal to the weighted average
of the LIBOR for a one month period (the Closing Date Interest Rate).  If the FHS Working Capital Adjustment Amount
is a negative amount, then Coventry shall promptly deliver or cause an
Affiliate to promptly deliver, by wire transfer of immediately available funds
to an account designated in writing by Buyer, an amount equal to the FHS
Working Capital Adjustment Amount, together with interest thereon from the
Closing Date to the date of payment at the Closing Date Interest Rate.  (e)As soon as practicable after the
beginning of the thirteenth month after the Closing Date, the FHS Working
Capital shall be re-calculated as of the Closing Date, taking into account only
post-Closing events through and including the twelve months following the
Closing Date as they relate to customer accounts receivable that existed on the
Closing Date and the aggregate allowance for doubtful accounts with respect
thereto (the Re-Calculated FHS Working Capital).  Coventry shall cooperate  18


with Buyer in determining a mutually agreeable figure
for the Re-Calculated FHS Working Capital. 
In the event of a disagreement between Coventry and Buyer as to the FHS
Working Capital as so re-calculated, the provisions of Section 3.2(c) relating
to the use of the Settlement Firm shall apply. 
The Re-Calculated FHS Working Capital Adjustment
Amount, which may be a positive or negative amount, shall mean
the amount equal to the Re-Calculated FHS Working Capital, as finally
determined in accordance with Sections 3.2(c) and 3.2(e), minus the Final
FHS Working Capital.  If the
Re-Calculated FHS Working Capital Adjustment Amount is a positive amount, then
Buyer shall promptly deliver, by wire transfer of immediately available funds
to an account or accounts designated in writing by Coventry, an amount equal to
the Re-Calculated FHS Working Capital Adjustment Amount, together with interest
thereon from the Closing Date to the date of payment at the rate equal to
Closing Date Interest Rate.  If the
Re-Calculated FHS Working Capital Adjustment Amount is a negative amount, then
Coventry shall promptly deliver or cause an Affiliate to promptly deliver, by
wire transfer of immediately available funds to an account designated in
writing by Buyer, an amount equal to the Re-Calculated FHS Working Capital
Adjustment Amount, together with interest thereon from the Closing Date to the
date of payment at the Closing Date Interest Rate.  (f)All amounts paid pursuant to this Section 3.2
shall be deemed an adjustment to the Purchase Price.  For purposes of this Section 3.2, all
computations of interest shall be made on the basis of a year of 365 days, in
each case for the actual number of days (including the first day but excluding
the last day) occurring in the period for which such interest is payable.  Any payments made by any Person pursuant to
this Section 3.2 shall be made by wire transfer of immediately available
funds within 10 Business Days after the date on which the FHS Working Capital
determinations become final and binding on the Parties under this Section 3.2.  (g)The FHS Working Capital, as finally
determined pursuant to this Section 3.2, shall be the final FHS Working
Capital for purposes of this Agreement.  3.3Methodology for Working Capital
Calculations.  Section 3.3 of the Seller Disclosure
Letter sets forth certain agreed-upon exceptions to GAAP applicable to the
determination of the FHS Working Capital under this Article III.  All FHS Working Capital determinations made
pursuant to this Article III (estimated and actual), including each and
every amount and calculation determined in accordance therewith, shall be
determined and calculated in accordance with GAAP, as it exists on the date
hereof, and as applied consistently with the preparation of the FHS Financial
Statements, except as set forth on Section 3.3 of the Seller Disclosure
Letter.  Section 3.3 of the Seller
Disclosure Letter shall set forth a sample calculation of the FHS Working
Capital calculated as of April 30, 2009.  19


ARTICLE 4  REPRESENTATIONS AND
WARRANTIES OF THE SELLERS  Except
as set forth in the Seller Disclosure Letter delivered by Sellers to Buyer
simultaneously with the execution of this Agreement, it being understood and
agreed that each item in a particular section of the Seller Disclosure Letter
applies only to such section and to any other section to which its relevance is
reasonably apparent on the face of such disclosure, each of the Sellers,
jointly and severally, represents and warrants to Buyer as follows:  4.1Organization, Etc.  (a)Each of the Sellers and the Acquired
Entities is a corporation or limited liability company duly incorporated or
formed, validly existing and in good standing under the laws of its
jurisdiction of incorporation or formation. 
CMS has all requisite corporate power and authority to own or lease and
operate the Acquired Assets.  Each of the
Acquired Entities has all of the requisite corporate or limited liability
company power and authority to own, or lease and operate its assets.  The Acquired Entities have all requisite
corporate or limited liability company power and authority to carry on the
Business as it is now being conducted. 
Each of the Acquired Entities is duly qualified or licensed to do
business and is in good standing in each jurisdiction in which the property
owned, leased or operated by such Person or the nature of the business
conducted by it makes such qualification necessary, except in such
jurisdictions where the failure to be so qualified or licensed and in good
standing has not had a Material Adverse Effect on the Business.  (b)Coventry has delivered to Buyer correct
and complete copies of the certificate of formation and limited liability
company agreement and correct and complete copies of the certificates of
incorporation and by-laws (or comparable organizational documents) of each of
the Acquired Entities (the CMS Group Charter
Documents), in each case as amended to the date of this
Agreement.  4.2Corporate Authority; No Violation, Etc.  (a)Each of the Sellers has the requisite
corporate power and authority to enter into this Agreement and each other
Transaction Agreement to which such Person is to be a party and to perform its
obligations hereunder and thereunder and to consummate the Transactions.  The execution, delivery and performance by
the Sellers of this Agreement and each such other Transaction Agreement and the
consummation of the Transactions have been duly authorized by all requisite
corporate action on the part of the Sellers. 
This Agreement has been duly executed and delivered by the Sellers and
constitutes a legal, valid and binding agreement of each of the Sellers,
enforceable against each such Person in accordance with its terms, except as
enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other Laws affecting creditors rights generally
and except insofar as the availability of equitable remedies may  20


be limited by applicable Law (the Bankruptcy and Equity Exception).  As of the Closing, each other Transaction
Agreement to which any of the Sellers is to be a party will have been duly
executed and delivered by each such Person and will constitute a legal, valid
and binding agreement of each such Person, enforceable against it in accordance
with its terms, subject to the Bankruptcy and Equity Exception.  (b)Except as set forth in Section 4.2(b) of
the Seller Disclosure Letter, none of the execution and delivery by any of the
Sellers or any of their Subsidiaries of this Agreement or any other Transaction
Agreement to which it is or will be a party, the consummation by the Sellers or
any of their Subsidiaries of the Transactions or compliance by the Sellers or
any of their Subsidiaries with any of the provisions hereof or thereof (a) violates
or conflicts with any provisions of the CMS Group Charter Documents, (b) requires
any consent, approval, authorization or permit of, registration, declaration or
filing with, or notification to, any Governmental Authority or any other Person
(except for (i) filings required under any applicable Antitrust Laws, (ii) Permits
as may be required under, and other applicable requirements of, state
securities laws and (iii) consents, approvals or notifications required
under Contracts that are not Material Contracts), (c) results in the
creation of a Lien on any of the Shares or the Acquired Assets, or (d) violates
or conflicts with any Rulings or Law applicable to the Business.  4.3Ownership of Interests and Stock; Subsidiaries.  (a)First Health Group owns (i) all of
the FHS Stock free and clear of all Liens and there are no other outstanding
shares of capital stock of FHS or Commitments to issue any additional shares of
FHS capital stock, and (ii) all of the FHC Stock free and clear of all
Liens and there are no other outstanding shares of capital stock of FHC or
Commitments to issue any additional shares of FHC capital stock.  Both the FHS Stock and the FHC Stock are validly
issued, fully paid and non-assessable.  (b)Coventry owns all of the Provider
Synergies Interests free and clear of all Liens and there are no other
outstanding interests in Provider Synergies or Commitments to issue any
additional equity interests in Provider Synergies.  The Provider Synergies Interests are validly
issued, fully paid and non-assessable.  (c)Section 4.3(c) of the Seller
Disclosure Letter sets forth the name of each Subsidiary of FHS, FHC and
Provider Synergies, and with respect to each Subsidiary, the jurisdiction in
which it is incorporated or organized and the jurisdictions, if any, in which
it is qualified to do business, the number of shares of its authorized capital
stock, the number and class of shares thereof duly issued and outstanding, the
names of all stockholders or other equity owners and the number of shares of
stock owned by each stockholder or the amount of equity owned by each equity
owner.  The outstanding shares of capital
stock or equity interests of each Subsidiary are validly issued, fully paid and
non-assessable.  All such shares or other
equity interests represented as being owned by FHS, FHC or Provider Synergies,
as applicable, are owned by them free and clear of any and all Liens.  There are no Commitments requiring the
issuance of any shares of capital stock or other equity interests of any
Subsidiary or  21


other securities convertible into shares of capital
stock or other equity interests of any Subsidiary.  4.4Title to, Condition and Sufficiency of Assets.  (a)None of the Acquired Entities owns any
real property in fee.  (b)Section 4.4(b) of the Seller
Disclosure Letter sets forth a list of all real property leases relating to the
Leased Real Property.  Each lease set
forth on Section 4.4(b) of the Seller Disclosure Letter is a valid
and binding obligation of an Acquired Entity. 
Each Acquired Entity that is a party to a lease covering the Leased Real
Property has good and valid title to the leasehold interest created by such
lease, free and clear of all Liens, except Permitted Liens.  No event has occurred that, with the passage
of time or the giving of notice or both, would constitute a default or breach
in any respect by any of the Acquired Entities, or to the Knowledge of the
Sellers, any other party thereto.  (c)CMS has good title to, or holds pursuant
to valid and enforceable leases, if any, all the properties and assets
(excluding real property) included in the Acquired Assets, with only such
exceptions as constitute Permitted Liens.  (d)The Acquired Entities have good title to,
or hold pursuant to valid and enforceable leases, all the properties and assets
(excluding real property) of the Acquired Entities, with only such exceptions
as constitute Permitted Liens.  (e)Except for the matters set forth on Section 4.4(e) of
the Seller Disclosure Letter, and after giving effect to the services to be
provided pursuant to the Transition Services Agreement, the Acquired Entities
and Acquired Assets are, and as of the Closing will be, sufficient for the
conduct of the Business as currently conducted,it being understood that
only services and certain Intellectual Property rights, but no physical assets,
are to be provided to an Acquired Entity pursuant to the Transition Services
Agreement.  4.5Financial Statements.  (a)Section 4.5(a) of the Seller
Disclosure Letter sets forth true, complete and correct copies of the unaudited
combined balance sheet of the Acquired Entities as of December 31, 2008,
2007 and 2006 and the related unaudited combined statements of income of the
Acquired Entities for the years then ended (collectively, the FHS Year End Financial Statements),
and (ii) the unaudited combined balance sheet of the Acquired Entities as
of April 30, 2009 and the unaudited combined statements of income of the
Acquired Entities for the four months ended April 30, 2009 (collectively,
the FHS Interim Financial Statements,
and together with the FHS Year End Financial Statements, the FHS Financial Statements).  (b)Except as set forth on Section 4.5(b) of
the Seller Disclosure Letter, the FHS Financial Statements are true and
complete in all material respects, and,  22


have been prepared in accordance with GAAP, consistent
with past practices, without modification of the accounting principles used in
the preparation thereof throughout the periods presented (except as noted
therein), and fairly present the financial position, results of operations of
the Acquired Entities as of the respective dates thereof (subject to
appropriate note and year-end adjustments).  (c)Coventry maintains systems of internal
accounting controls sufficient to provide reasonable assurances that: (i) transactions
are executed in accordance with managements general or specific authorization;
(ii) transactions are recorded as necessary to permit the preparation of
financial statements in conformity with GAAP and to maintain accountability for
assets; (iii) access to assets is permitted only in accordance with managements
general or specific authorization; and (iv) the recorded accountability
for assets is compared with the actual levels at reasonable intervals and
appropriate action is taken with respect to any differences.  (d)Coventrys management has completed its
assessment of the effectiveness of Coventrys internal control over financial
reporting in compliance with the requirements of Section 404 of the
Sarbanes-Oxley Act for the year ended December 31, 2008, and such
assessment concluded that such controls were effective. Coventrys principal
executive officer and its principal financial officer have identified, based on
their evaluation made for purposes of SEC Rule 13a-14 as of and for the
period ended March 31, 2009, (i) no significant deficiencies in the
design or operation of Coventrys internal control over financial reporting
which could adversely affect the ability of an Acquired Entity to record,
process, summarize and report financial data in the periodic reports Coventry
is required to file under the Exchange Act and no material weaknesses in such
internal control over financial reporting pertaining to an Acquired Entity and (ii) no
fraud, whether or not material, that involves management or other employees of
the Acquired Entities who have a significant role in Coventrys internal
control over financial reporting.  (e)All books, records and accounts of each
of the Acquired Entities are accurate and complete and are maintained in all
material respects in accordance with good business practice and all applicable
Laws.  Complete and accurate copies of
all minute books of each of the Acquired Entities have been made available to
Buyer.  4.6Absence of Certain Changes or Events. 
Except (i) as specifically contemplated or permitted by this
Agreement or the other Transaction Agreements, or (ii) as set forth in Section 4.6
of the Seller Disclosure Letter, since December 31, 2008, the Business has
been conducted in all material respects in the ordinary course, and there has
not been any Material Adverse Effect on the Business.  Since December 31, 2008, none of the
Acquired Entities has taken any action described in Section 6.1 hereof
that if taken after the date hereof and prior to the Closing Date without the
prior written consent of Buyer would violate such provision.  Without limiting the foregoing, since December 31,
2008 there has not occurred any damage, destruction or loss (whether or not
covered by insurance) of any asset of the Acquired Entities which materially
affects the use thereof.  23


4.7Litigation; No Undisclosed Liabilities. 
Except as described on Section 4.7 of the Seller Disclosure Letter:  (a)No Action against CMS (with respect to
the Acquired Assets), the Acquired Entities or the Business is pending or, to
Sellers Knowledge, threatened.  To
Sellers Knowledge, there are no investigations pending or threatened against
CMS (with respect to the Acquired Assets), the Acquired Entities or the
Business.  (b)None of the Acquired Entities has any
liability or obligation of any nature (whether accrued, absolute, contingent or
otherwise) other than those (i) incurred in the ordinary course of
business since December 31, 2008, or (ii) fully reflected on or
reserved against in the FHS Financial Statements.  4.8Compliance with Laws. 
Except as set forth in Section 4.8 of the Seller Disclosure Letter,
the Business is being conducted in all material respects in compliance with all
applicable Laws.  None of the Acquired
Entities has received any written notice of or been charged with the violation
of any Laws.  To the Knowledge of
Sellers, none of the Acquired Entities is under investigation with respect to
the violation of any Laws.  4.9Environmental Matters. 
Except as set forth on Section 4.9 of the Seller Disclosure Letter:  (a)each of the Acquired Entities has
obtained all Permits required under Environmental Laws for the conduct and
operation of the Business and is in material compliance with the terms and
conditions contained therein;  (b)each of the Acquired Entities is in
compliance with all applicable Environmental Laws, except for such
noncompliance as would not form the basis of a claim under or create a
liability under applicable Environmental Laws that would be material to such
Acquired Entity, and Sellers have made available to Buyers all environmental
reports, assessments, surveys, audits, claims, and other documents that are in
the possession and control of Sellers regarding environmental matters
pertaining to the Acquired Entities and that are material to the operation of
the Business;  (c)to Sellers Knowledge, none of the
Acquired Entities is subject to any contractual environmental indemnification
obligation regarding the business or properties currently owned, leased or
operated by any of the Acquired Entities;  (d)there are no environmental Actions
pending or threatened with respect to the Business;  (e)there is no condition on, at or under any
property (including the air, soil and ground water) currently or formerly
owned, leased or used by any of the Acquired Entities (including off-site waste
disposal facilities) or created by any of the Acquired Entities operations
that would create liability with respect to the Business under applicable
Environmental Laws; and  24


(f)there are no past or present actions,
activities, circumstances, events or incidents (including the Release or
Handling of any Hazardous Material) with respect to any of the Acquired
Entities that would form the basis of a claim or create a liability under
applicable Environmental Laws that is material to an Acquired Entity.  4.10Tax Matters. 
Except as set forth in Section 4.10 of the Seller Disclosure
Letter:  (a)(i) All income and other material
Tax Returns required to be filed by the Acquired Entities or with respect to
the Acquired Assets have been timely filed, (ii) all such Tax Returns are
true, correct and complete in all material respects, (iii) all income and
other material Taxes due have been timely paid, (iv) the Acquired Entities
have duly and timely withheld all income and other material Taxes relating to
the Business required to be withheld and such withheld Taxes have been either
duly and timely paid to the proper Governmental Authority or properly set aside
in accounts for such purpose and will be duly and timely paid to the proper
Governmental Authority.  (b)(i) No audits or other
administrative proceedings or court proceedings are presently pending or
threatened  in writing with regard to any
income or other material Taxes or income or other material Tax Returns of any
of the Acquired Entities or with respect to any of the Acquired Assets, (ii) no
Taxing Authority is now asserting or has asserted any deficiency or claim for
income and other material Taxes or any adjustment to income and other material
Taxes with respect to which any of the Acquired Entities may be liable which
have not been fully paid or finally settled, (iii) none of the Acquired
Entities has granted (or is subject to) any waiver or extension that is
currently in effect for the period of limitations for the assessment,
collection or payment of any Tax or the filing of any Tax Return, and (iv) no
claim has been made by a Taxing Authority in a jurisdiction where the Acquired
Entities do not file Tax Returns such that the Acquired Entities are or may be
subject to taxation by that jurisdiction.  (c)Section 4.10(c) of the Seller
Disclosure Letter lists any audit report issued within the last three years
relating to any income and other material Taxes due from or with respect to
each of the Acquired Entities or Acquired Assets.  All income and other material Tax Returns
filed by or on behalf of each of the Acquired Entities and with respect to the
Acquired Assets have been examined by the relevant Taxing Authority or the
statute of limitations with respect to such Tax Returns has expired.  (d)Neither the Acquired Entities nor any
other Person on their behalf has (i) agreed to or is required to make any
adjustments pursuant to Section 481(a) of the Code or any similar
provision of Law or has any Knowledge that any Taxing Authority has proposed
any such adjustment, or has any application pending with any Taxing Authority
requesting permission for any changes in accounting methods that relate to any
of the Acquired Entities, (ii) executed or entered into a closing
agreement pursuant to Section 7121 of the Code or any similar provision of
Law with respect to any of the Acquired Entities affecting the Acquired
Entities after the date hereof, (iii) granted to any Person any power of
attorney that is currently in force with respect to any Tax matter, or  25


(iv) executed or entered into any agreement with,
or obtained any consents or clearances from, any Taxing Authority, or been
subject to any ruling guidance specific to the Acquired Entities, any of which
would be binding on Buyer for any taxable period (or portion thereof) ending
after the Closing Date.  (e)None of the Acquired Entities has
constituted either a distributing corporation or a controlled corporation
(within the meaning of Section 355(a)(1)(A) of the Code) in a
distribution of stock qualifying for tax-free treatment under Section 355
of the Code (A) in the two years prior to the date of this Agreement or (B) in
a distribution which could otherwise constitute part of a plan or series of
related transactions (within the meaning of Section 355(e) of the
Code) in conjunction with the transactions contemplated by this Agreement.  (f)There is no taxable income of any of the
Acquired Entities or with respect to any of the Acquired Assets that will be
required under applicable Tax Law to be reported by Buyer or any of its
Affiliates, including the Acquired Entities, for a taxable period beginning after
the Closing Date which taxable income was realized (and reflects economic
income) arising prior to the Closing Date.  (g)None of the Acquired Entities has, or has
ever had, a permanent establishment in any country other than the United
States, or has engaged in a trade or business in any country other than the
United States that subjected it to Tax in such country.  (h)Each of the Sellers is a United States
Person within the meaning of Code Sections 897 and 1445.  (i)Provider Synergies, at all times since
its formation, (A) is and has been treated for U.S. federal income tax
purposes (and in all states in which it files income Tax Returns) as a single
member limited liability company disregarded for federal income Tax purposes,
and (B) has not filed any election under Treasury Regulations Section 301.7701-3(c) (or
similar provision of state, local or foreign Law) to be treated as an
association taxable as corporation, and has not been classified as a
corporation by any Taxing Authority.  (j)None of the Acquired Entities (i) is
a party to, bound by or has any obligation under any Tax allocation, sharing,
indemnity or similar agreement or arrangement, other than with respect to the
Consolidated Group for which Coventry is the common parent, (ii) has any
obligation for Taxes of any Person under Treasury Regulations Section 1.1502-6
(or any predecessor or successor thereof or any analogous or similar provision
of Law), other than with respect to the Consolidated Group for which Coventry
is the common parent, or (iii) is or has ever been a member of a
Consolidated Group, other than the Consolidated Group of which Coventry is the
common parent.  (k)None of the Acquired Assets and none of
the properties or assets of any of the Acquired Entities are subject to any Tax
lien (other than Permitted Liens).  26


(l)None of the Acquired Entities has
consummated, has participated in or is currently participating in any
transaction that was or is a reportable transaction as defined in Treasury
Regulations Section 1.6011-4(b).  (m)No Acquired Entity has an interest in an
entity classified as a partnership for U.S. federal income tax purposes.  4.11ERISA and Employee Plans.  (a)Section 4.11(a) of the Seller
Disclosure Letter lists each material Employee Plan.  Each of the Sellers has heretofore made
available to Buyer true and complete copies of each Employee Plan and any
amendments thereto, any related trust or other funding vehicle, the most recent
annual reports or summaries, the most recent determination or opinion letter,
the most recent actuarial valuations, the most recent summary plan descriptions
and written descriptions of all non-written agreements relating to Employee
Plans.  (b)No Employee Plan sponsored, maintained or
contributed to by any of the Sellers or any of their respective ERISA
Affiliates, within the six (6) year period preceding the Closing Date, is
or has been subject to Title IV of ERISA, or is or was a multiemployer plan as
defined in Section 3(37) of ERISA.  (c)Each Employee Plan has been operated and
administered in all material respects in accordance with its terms and
applicable Law, including, but not limited to, ERISA, the Code and the Laws of
any applicable foreign jurisdiction. 
There are no pending or, to Sellers Knowledge, threatened claims by, on
behalf of or against any Employee Plan or any assets thereof, other than
routine claims for benefits and no matter is pending (other than routine
qualification determination filings, copies of which have been furnished to
Buyer or will be promptly furnished to Buyer when made) with respect to any
Employee Plan before the IRS or the United States Department of Labor.  (d)Each Employee Plan intended to be qualified
within the meaning of Section 401(a) of the Code has received a
determination or opinion letter from the IRS stating that it and the trust
maintained thereunder is exempt from taxation under Section 401(a) or
Section 501(a) of the Code, respectively, and, to Sellers Knowledge,
nothing has occurred with respect to the operation of any such plan which could
cause the loss of such qualification or exemption or the imposition of any
liability, penalty or Tax under ERISA or the Code.  (e)All material contributions required to
have been made under any of the Employee Plans by Law have been timely made and
no accumulated funding deficiencies exist in any of the Employee Plans subject
to Section 412 of the Code.  (f)Except as set forth on Section 4.11(f) of
the Seller Disclosure Letter and except as otherwise provided in or
contemplated by this Agreement, any other Transaction Agreement, or otherwise
required under applicable Law, the consummation  27


of the Transactions shall not result, by itself or
with the passage of time, in the payment or acceleration of any amount, the
accrual or acceleration of any benefit or any increase in any vested interest
or entitlement to any benefit or payment by any Eligible Employee.  (g)Neither Sellers nor any of their ERISA
Affiliates has any obligation to provide medical, surgical, hospitalization,
death or similar benefits (whether or not insured) for any participant (or any
of the participants dependents, spouse, or beneficiaries) for the period
extending beyond their retirement or other termination of service, other than
continuation coverage mandated by the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended (COBRA) or
the American Recovery Act of 2009 (ARRA) and
at the expense of the participant or the participants beneficiary.  Each of the Sellers and any of the ERISA
Affiliates which maintains a group health plan within the meaning of Section 5000(b)(1) of
the Code has complied in good faith with any notice and continuation requirements
of Section 4980B of the Code, as amended by ARRA, COBRA, Part 6 of
Subtitle B of Title I of ERISA, as amended by ARRA and with the Health
Insurance Portability and Accountability Act of 1996 (HIPAA),
as amended by ARRA and the regulations thereunder.  (h)With respect to each Employee Plan that
is a maintained outside of the United States substantially for employees who
are situated outside the United States (the Foreign
Plans):  (i) each
Foreign Plan is in compliance in all material respects with the applicable
provisions of Law and regulations regarding employee benefits, mandatory
contributions and retirement plans of each jurisdiction in which each such
Foreign Plan is maintained, to the extent those Laws are applicable to such
Foreign Plan; (ii) each Foreign Plan has been administered at all times
and in all material respects in accordance with its terms; (iii) there are
no pending investigations by any Governmental Authority involving any Foreign
Plan, and no pending claims (except for claims for benefits payable in the
normal operation of the Foreign Plans), suits or proceedings against any
Foreign Plan or asserting any rights or claims to benefits under any Foreign
Plan; (iv) the transactions contemplated by this Agreement, by themselves
or in conjunction with any other transactions, will not create or otherwise
result in any material liability, accelerated payment or any materially
enhanced benefits with respect to any Foreign Plan; and (v) all
liabilities with respect to each Foreign Plan have been funded to the extent
required by the terms of such Foreign Plan and applicable Law or have been
properly reflected in the financial statements of the Sellers.  (i)Any individual who performs services for
one or more members of the CMS Group (other than through a Contract with an
organization other than such individual) and who is not treated as an employee
for federal income or employment Tax purposes by one or more members of the CMS
Group is not an employee for such purposes.  4.12Labor and Employment Matters.  (a)Neither the Sellers nor any of their
respective Affiliates is a party to any collective bargaining or similar
agreement with respect to any Eligible Employees  28


with any labor union, group or association (Labor Union) and no such agreement
is being negotiated.  No Labor Union
represents or, to the Knowledge of Sellers, purports to represent any Eligible
Employees.  To the Knowledge of Sellers,
there are no, and have not been since January 1, 2004 any, activities or
proceedings of any Labor Union to organize any such activity. There are no, and
have not been since January 1, 2004 any, strikes, slowdowns, work
stoppages, lockouts, labor grievances, unfair labor practice complaints or
other labor dispute, or, to the Knowledge of Sellers, threats of such
activities, by any Labor Union or any Eligible Employees.  (b)Except as set forth on Section 4.12(b) of
the Seller Disclosure Letter, there are no complaints, charges or claims
against any of the Sellers pending or, to the Knowledge of Sellers, threatened
that could be brought or filed, with any Governmental Authority or based on,
arising out of, in connection with or otherwise relating to the employment or
termination of employment or failure to employ by the Sellers, of any Eligible
Employee.  Each of the Sellers is in
compliance with all Laws relating to labor and employment, including all such
Laws relating to wages, hours, overtime, mass layoffs or plant closings,
collective bargaining, discrimination, civil rights, safety and health, workers
compensation and the collection and payment of withholding and/or social
security taxes and any similar tax except for immaterial non-compliance.  Since January 1, 2004, there have not
been any plant closings, mass layoffs or other similar terminations of Eligible
Employees that would create any obligations upon or liability of any of Sellers
or any of their respective Affiliates under the WARN Act requiring notice in
connection with plant closings, mass layoffs or other similar terminations of
employment.  4.13Intellectual Property.  (a)Section 4.13(a) of the Seller
Disclosure Letter sets forth an accurate and complete list of all Intellectual
Property that is the subject of an issuance or registration or an application
for issuance or registration that isowned by any of the
Acquired Entities(Registered IP).  For each such item of Registered IP, Section 4.13(a) of
the Seller Disclosure Letter lists (i) the record owner of such item, (ii) the
jurisdiction in which such item has been issued or registered or in which such
application has been filed and (iii) the date and number of such issuance,
registration or application.  Except as
set forth on Section 4.13(a) of the Seller Disclosure Letter, to the
Sellers Knowledge, (A) there are no overdue filings or unpaid filing,
maintenance or renewal fees currently overdue with respect to any Registered IP
and no filings or fees due to be submitted or paid with respect to any
Registered IP within ninety (90) days after the date of this Agreement and (B) no
material Registered IP has lapsed or been cancelled or expired other than in
the reasonable business judgment of the Acquired Entities in the ordinary
course of business.  (b)Except as setforth on Section 4.13(b) of
the Seller Disclosure Letter or as has not had and would not have a Material
Adverse Effect,(i) the
Acquired Entities exclusively own all right, title and interest in all Business
IP and Business Technology, and otherwise control or have the right to use,
practice and otherwise  29


exploit, all other Intellectual Property and
Technology as the same is used, practiced and otherwise exploited in the
Business as currently conducted (including in connection with services provided
by the Acquired Entities to third parties), free of all Liens, (ii) no
Action or Ruling is pending or is threatened against any of the Acquired
Entities or CMS by any Person in writing with respect to any Business IP or Business
Technology (including the validity or enforceability thereof or the ownership
or use thereof by any of the Acquired Entities) or that alleges that the
conduct of the Business or any Business IP or Business Technology or any other
Intellectual Property or Technology used by any of the Acquired Entities (or
the use, practice or other exploitation thereof) infringes or misappropriates
or violates (Infringes) the Intellectual
Property rights of any Person, and none of the Acquired Entities is subject to
any outstanding Ruling involving any Intellectual Property or Technology that
relates to the Business, (iii) to Sellers Knowledge, all of the
Registered IP (excluding any applications included in the Registered IP) is
enforceable, and Sellers are not aware of any facts that would limit or impair
the validity of any of the Registered IP, 
(iv) to the Sellers Knowledge, neither the conduct of the Business
nor the use, practice or other exploitation of any Business IP or Business
Technology Infringes the Intellectual Property rights of any Person, (v) to
Sellers Knowledge, none of the Business IP is being Infringed by any Person
and (vi) no Action is pending or threatened in writing by any of the
Acquired Entities against any Person alleging that any Person is Infringing any
Business IP or Business Technology.  (c)The Business IP and Business Technology
owned by the Acquired Entities and any Intellectual Property or Technology
licensed to any of the Acquired Entities pursuant to the Material Contracts, together
with the Intellectual Property and Technology to be made available to Buyer or
its Subsidiaries by CMS pursuant to the Transition Services Agreement, include
all of the Intellectual Property and Technology that is used in, and is
sufficient to enable, the conduct by the Acquired Entities of the Business as
currently conducted.  To Sellers
Knowledge, the only Intellectual Property and Technology to be made available
to Buyer or its Subsidiaries by CMS pursuant to the Transition Services
Agreement will be provided pursuant to licenses from third parties that are
identified in a schedule to the Transition Services Agreement.  (d)Each of the Acquired Entities has taken
commercially reasonable measures to protect the confidentiality of all trade
secrets, personal identifiable information and other confidential and
proprietary information of the Acquired Entities or any Person to whom any of
the Acquired Entities has a confidentiality obligation.  To the Sellers Knowledge, (i) to the
extent that any Business IP or Business Technology has been developed or
created by an employee, consultant, independent contractor or third party on
behalf of or for the Acquired Entities, the Acquired Entities have obtained
ownership of such Business IP or Business Technology created by such employee,
consultant, independent contractor or third party; and (ii) no employee,
consultant or independent contractor of any of the Acquired Entities is, as a
result of or in the course of such employees, consultants or independent contractors
engagement by such Acquired Entity, in default or breach of any term of any
employment agreement, non-disclosure agreement, assignment of invention
agreement or similar agreement.  30


(e)Except with respect to (i) licenses of
Off-the-Shelf Software or (ii) any payments required of any of the Acquired
Entities under any Material Contract, none of the Acquired Entities is
required, obligated or under any liability whatsoever to make any payments by
way of royalties, fees or otherwise to any Person with respect to the use of
any Intellectual Property or Technology in the conduct of the Business as
currently conducted.  (f)To the Sellers Knowledge, the
consummation of the Transactions will not result in the loss or impairment of
the right of Buyer or any of the Acquired Entities to own or use any BusinessIP or Business
Technology, except as would not have a Material Adverse Effect.  Except as would not have a Material Adverse
Effect or as disclosed
on Section 4.13(f) of the Seller Disclosure Letter, neither this Agreement nor
any of the Transactions will result in the grant by any of the Acquired
Entities of any ownership interest, right, license or protection from any
Action with respect to any Business IP or Business Technology.  (g)Except as set forth in Section 4.13(g) of
the Seller Disclosure Letter, the Acquired Entities have established privacy
compliance policies.  To the Knowledge of
Sellers, each of the Acquired Entities has complied and is complying in all
material respects, as applicable at the relevant time, with (i) such policies
and (ii) any Laws regarding social security numbers.  (h)Except as would
not have a Material Adverse Effect, during the previous two (2) years, there has been no
unscheduled downtime or disruption with respect to the information technology
systems owned, leased or licensed by the Acquired Entities that resulted in the
Acquired Entities being unable to perform services on behalf of its clients.  To Sellers Knowledge, during the previous
eighteen (18) months, there has been no material unauthorized access to any
such information technology systems or any confidential or proprietary
information stored thereon.  (i)Section 4.13(i) of the Seller Disclosure
Letter sets forth a complete and accurate list of all Software developed by or
for any of the Acquired Entities, which is owned by an Acquired Entity (Business Software).  (j)None of the Acquired Entities has
licensed or provided to any Person (other than any employee, consultant or
independent contractor of the Acquired Entities) any source code for any
Business Software.  No Business Software
has been combined, incorporated or embedded with any open source or public
library code that is licensed under any terms that impose a requirement or
condition that would require that any source code for such proprietary Business
Software (i) be disclosed or distributed in source code form to a third party
or (ii) be redistributed at no charge.  31


4.14Material Contracts.  (a)Set forth in Section 4.14(a) of the
Seller Disclosure Letter is a list of each Contract of the following types or
having the following terms to which any of the Acquired Entities is a party as
of the date hereof:  (i)a Contract that purports to limit,
curtail or restrict the ability of the Acquired Entities or any of its future
Subsidiaries or Affiliates to compete in any geographic area or line of
business or restricts the Persons to whom the Acquired Entities or any of its
existing or future Subsidiaries or Affiliates may sell products or deliver
services;  (ii)a partnership or joint venture agreement;  (iii)a Contract for the acquisition, sale or
lease of properties or assets outside the ordinary course of business (by
merger, purchase or sale of stock or assets or otherwise) entered into since December
31, 2006, and which provides for aggregate consideration in excess of $175,000
annually;  (iv)a Contract with any Governmental Authority
which provides for aggregate consideration in excess of $175,000 annually;  (v)an agreement relating to the transfer or
voting of, or providing for registration rights with respect to the Shares;  (vi)a mortgage, pledge, security agreement,
deed of trust, hypothecation, or other Contract granting a Lien on any property
or assets of the Acquired Entities, other than Permitted Liens;  (vii)a customer or client Contract involving
revenue or potential revenue in excess of $175,000 annually;  (viii)a Contract (other than customer or
client) that involves consideration of greater than $175,000 annually;  (ix)a collective bargaining agreement;  (x)a standstill or similar agreement;  (xi)a Contract providing for severance,
retention, change in control or similar payments;  (xii)a Contract for the employment of any
individual on a full-time, part-time or consulting or other basis;  (xiii)any lease for real property;  32


(xiv)any license or royalty Contract with
respect to Business IP or Business Technology, other than licenses for
Off-the-Shelf Software; and  (xv)commitments or agreements to enter into
any of the foregoing.  (b)Each of the Contracts and other documents
required to be listed on Section 4.14(a) of the Seller Disclosure Letter,
together with any and all other Contracts of such type entered into in
accordance with Section 6.1 is a Material Contract.  The Sellers have heretofore made available to
Buyer correct and complete copies of each Material Contract (subject to the
applicable provisions of the Confidentiality Agreement) in existence as of the
date hereof, together with any and all amendments and supplements thereto and
material side letters and similar documentation relating thereto.  (c)Except for Material Contracts that
terminate in accordance with their terms between the date hereof and Closing,
each of the Material Contracts is valid, binding and in full force and effect
and, to the Knowledge of Sellers, is enforceable in accordance with its terms,
subject to the Bankruptcy and Equity Exception. 
Except as separately identified in Section 4.14(c) of the Seller
Disclosure Letter, no approval, consent or waiver of or notice to any Person is
needed in order that any Material Contract continue in full force and effect
without any changes in terms following the consummation of the
Transactions.  The Acquired Entities are
not in default under any Material Contract nor, to the Knowledge of the Sellers,
does any condition exist that, with notice or lapse of time or both, would
constitute a default thereunder by any of the Acquired Entities.  To the Knowledge of Sellers, no other party
to any Material Contract is in default thereunder, nor does any condition exist
that with notice or lapse of time or both would constitute a default by any
such other party thereunder.  Except for
Material Contracts, the termination of which would result in potential Losses
aggregating less than $650,000, the Sellers have not received any written
notice of termination or cancellation under any Material Contract or, to
Sellers Knowledge, received any written notice of breach or default under any
Material Contract which breach has not been cured, or granted to any third
party any rights, adverse or otherwise, that would constitute a breach of any
Material Contract.  (d)Section 4.14(d) of the Seller Disclosure
Letter sets forth an accurate and complete list of all Material Contracts
between any Acquired Entity and their respective customers or clients which
either give rise to a right of termination by, or require notice to, any such
customer or client as a result of the Transactions (e.g., as a result of change
in control provisions) (the Change In Control Customer
Contracts).  Since December
31, 2008 to the date hereof, no customer or client identified on Section 4.14(d)
of the Seller Disclosure Letter has terminated its relationship with an
Acquired Entity or materially reduced or changed the pricing or other material
terms of its business with such Acquired Entity and no such customer or client
has notified Sellers in writing or, to the Knowledge of Sellers, otherwise
informed Sellers that it intends to terminate or materially reduce or change
the pricing or other material terms.  33


(e)Except as set forth in Section 4.14(e) of
the Seller Disclosure Letter, each of the Acquired Entities, as applicable, has
satisfied all performance standards under any Material Contract where it is
required to do so in order to receive any fees, bonuses, rebates, incentives,
or other payments at the levels at which it has received fees or payments under
such Material Contract in the last or the current fiscal year.  Except as set forth in Section 4.14(e) of the
Seller Disclosure Letter, none of the Acquired Entities, as applicable, is
required to return any fees or payments received by it or to provide credits
against any future fees or payment that would otherwise be due to it under any
Material Contract, nor is it subject to any penalties under any such Material
Contract, by reason of its failure to satisfy any performance standard
contained in such Material Contract.  4.15Insurance.  Section 4.15
of the Seller Disclosure Letter sets forth an accurate and complete list
(including the carrier of such policies and the amount of the coverage
thereunder) of all material workers compensation, automobile, terrorism,
earthquake, flood, fire, general liability, fiduciary liability, directors and
officers liability, malpractice liability, theft and other forms of property
and casualty and other material insurance maintained by Coventry or any of its
Subsidiaries with respect to the Business, the Acquired Assets, the properties
and assets of the Acquired Entities or the Eligible Employees and any written
notice from any insurance company relating to a reservation of rights under any
policy under which a claim has been made (collectively, the Policies).  The Policies provide coverage for the
operations conducted with respect to the Business, the Acquired Assets, the
properties and assets of the Acquired Entities of a scope and coverage
consistent with customary practice in the industries in which the Acquired
Entities operate.  Except for Policies that
have been, or are scheduled to be, terminated in the ordinary course of
business and in accordance with the terms thereof, each of the insurance
policies set forth in Section 4.15 of the Seller Disclosure Letter is in full
force and effect.  To the Knowledge of
Sellers, none of the Acquired Entities is in breach or default, and none of the
Acquired Entities has taken any action or failed to take any action which, with
notice or the lapse of time, would constitute such a breach or default, or
permit termination or modification, of any of the Policies.  No written notice of cancellation or
termination has been received by the Sellers with respect to any of the
Policies.  The consummation of the
Transactions will not, in and of itself, cause the revocation, cancellation or
termination of any Policy.  4.16Payments to Employees. 
Except as otherwise provided for in or contemplated by this Agreement or
the other Transaction Agreements, or as set forth on Section 4.16 of the Seller
Disclosure Letter, no Employee Plan of Coventry or its Subsidiaries, and no
other contractual arrangements between Coventry or any of its Subsidiaries and
any third party, exist that will, as a result of the Transactions, (i) result
in the payment (or increase of any payment) by Coventry or any of its
Subsidiaries to any current, former or future director, officer, employee or
consultant of CMS or any of the Acquired Entities of any money or other
property or rights or (ii) accelerate or provide any other rights to benefits
to any such individual, whether or not (A) such payment, increase, acceleration
or provision would constitute a parachute payment (within the  34


meaning of Section 280G of the Code) or (B) the
passage of time or some other subsequent action or event would be required to
cause such payment, acceleration or provision to be triggered.  4.17Permits.  Section 4.17
of the Seller Disclosure Letter contains a true and complete list of each
material Permit (other than Permits referred to in Section 4.9) that is owned,
held or possessed by any of the Acquired Entities or that otherwise relates to
the Acquired Assets (FHS Material Permits).  Each of the Acquired Entities is, and has
been in compliance in all material respects with the terms of the applicable
FHS Material Permit.  The FHS Material
Permits collectively constitute all of the material licenses necessary to
permit the Acquired Entities to lawfully conduct the Business and to permit the
Acquired Entities to own, use, operate and maintain the properties and assets
of the Acquired Entities in substantially the same manner in which they
currently own and use such properties and assets.  Each of the FHS Material Permits is current
and valid and, except as set forth on Section 4.17 of the Seller Disclosure
Letter, Sellers have no Knowledge of any actual or proposed revocation,
withdrawal, suspension, cancellation or termination of, or modification to, any
FHS Material Permits.   The consummation
of the Transactions, in and of themselves, will not cause the revocation or
cancellation of any FHS Material Permit.  4.18Brokers or Finders. 
Except as previously disclosed to Buyer, no agent, broker, investment
banker, financial advisor or other similar Person is or will be entitled, by
reason of any agreement, act or statement by Coventry or any of its
Subsidiaries, directors, officers or employees, to any financial advisory,
brokers, finders or similar fee or commission from, to reimbursement of
expenses by or to indemnification or contribution by, in each case, the Sellers
or any of their respective Subsidiaries in connection with any of the
Transactions.  4.19Related Party Transactions. 
Except as set forth on Section 4.19 of the Seller Disclosure Letter, no
key employee, officer, manager, director, stockholder, partner or member of the
Acquired Entities, or, to the Knowledge of Sellers, any member of his or her
immediate family or any of their respective Affiliates (Related
Persons) (i) owes any amount to Coventry or any of its
Subsidiaries nor, except for salary, wages and other amounts payable to or for
the benefit of the employees pursuant to any Employee Plan, does Coventry or
any of its Subsidiaries owe any amount to, or has Coventry or any of its
Subsidiaries made or committed to make any loan or guarantee of any credit or
performance to or for the benefit of, any Related Person, (ii) except for the
relationship set forth above, is involved in any business arrangement or other
relationship with Coventry or any of its Subsidiaries (whether written or
oral), (iii) owns any property or right, tangible or intangible, that is used
by Coventry or any of its Subsidiaries, (iv) to Sellers Knowledge, has any
claim or cause of action against Coventry or any of its Subsidiaries or (v), to
Sellers Knowledge, owns any direct or indirect interest of any kind in, or
controls or is a director, officer, employee or partner of, or consultant to,
or lender to or borrower from or has the right to participate in the profits
of, any Person which is a competitor, supplier, customer, landlord, tenant,
creditor or debtor of Coventry or any Subsidiary.  35


4.20Banks; Power of Attorney.  Section
4.20 of the Seller Disclosure Letter contains a complete and correct list of
the names and locations of all banks in which the Acquired Entities have
accounts or safe deposit boxes and the names of all persons authorized to draw
thereon or to have access thereto. 
Except as set forth on Section 4.20 or Section 4.10(c) of the Seller
Disclosure Letter, no person holds a power of attorney to act on behalf of any
of the Acquired Entities.  4.21Certain Payments. 
None of the Acquired Entities, nor, to the Knowledge of the Sellers, any
director, officer, employee, or other Person associated with or acting on
behalf of any of them, has directly or indirectly (a) made any contribution,
gift, bribe, rebate, payoff, influence payment, kickback, or other payment to
any Person, private or public, regardless of form, whether in money, property,
or services (i) to obtain favorable treatment in securing business for the
Acquired Entities, (ii) to pay for favorable treatment for business secured by
the Acquired Entities, (iii) to obtain special concessions or for special
concessions already obtained, for or in respect of the Acquired Entities, or (iv)
in violation of any Law.  4.22Health Care Regulatory Compliance.  (a)No Litigation Relating to Licensing
Matters.  None of the Acquired Entities is involved in
any Action and to Sellers Knowledge, none of the Acquired Entities are
involved in any investigation, by or with any Governmental Authority relating
to any Healthcare Permit required, or alleged by such Governmental Authority to
be required, for the operation of its business which, if determined or resolved
adversely, would prevent it from doing business with any Governmental Authority
or any Person regulated by a Governmental Authority or have an adverse impact
on the ability of the Acquired Entities to conduct Business, other than any
local licensing matter that is incidental in nature.  (b)Fraud and Abuse. 
The Acquired Entities and, to the Knowledge of the Sellers, their
respective officers, managers, directors, employees and shareholders, have not
knowingly engaged in any activities that are prohibited under 42 U.S. Code Section
1320a-7a and 7b, or the regulations promulgated pursuant to such statutes or
similar or related state or local statutes or regulations.  (c)Compliance with Healthcare Laws. 
Except as set forth in Section 4.22(c), of the Seller Disclosure Letter,
and without limiting the generality of any other representation or warranty
made by the Sellers herein, the Acquired Entities are conducting and have
conducted their business and operations in compliance with, and none of the
Acquired Entities nor any of their respective officers, managers, directors,
employees or shareholders have engaged in any activities that would constitute
a violation of, any applicable Healthcare Law (including, the Prescription Drug
Marketing Act, the Federal Controlled Substances Act of 1970, Food, Drug and
Cosmetic Act and any state Pharmacy Practice Acts).  Except as set forth in Section 4.22(c) of the
Seller Disclosure Letter:  36


(i)none of the Acquired Entities has
received any written notice or communication from any Governmental Authority
alleging noncompliance with any Healthcare Laws;  (ii)to the Knowledge of Sellers, there is no
civil, criminal or administrative action, suit, demand, claim, complaint, hearing,
investigation, notice, demand letter, warning letter, proceeding or request for
information related to noncompliance with, or otherwise involving, any
Healthcare Laws pending against any of the Acquired Entities;  (iii)to the extent required by any Healthcare
Laws, any remuneration exchanged between the Acquired Entities and their
customers, suppliers, contractors, consultants or other entities with which
they have a business relationship has at all times been commercially
reasonable, negotiated at arms-length and represents the fair market value for
rendered services; and  (iv)the Acquired Entities are not relying on
any exemption from or deferral of any Healthcare Law that would not be
available after the Closing.  (d)Third-Party Payors. 
Except as disclosed in Section 4.22(d) of the Seller Disclosure Letter,
the Acquired Entities have no outstanding overpayments or refunds due to
Government Programs in excess of $10,000. 
The Acquired Entities have paid or caused to be paid all known and undisputed
refunds, overpayments, discounts or adjustments that have become due to
Government Programs other than any refund, overpayment, discount or adjustment
that occurs in the ordinary course of business. 
None of the Acquired Entities have received any notice indicating that
it is excluded or suspended from participation in a Government Program.  (e)HIPAA Compliance. 
The Acquired Entities are in all material respects in compliance, to the
extent currently applicable, with the provisions of the HIPAA, as amended by
ARRA, and all regulations promulgated pursuant to HIPAA, including the
Transaction Code Set Standards, the Privacy Rules and the Security Rules set
forth at 45 C.F.R. Parts 160 and 164.  (f)Prescription Drug Purchases. 
The purchase of prescription drugs and related items by the Acquired
Entities has at all times been conducted pursuant to the proper classification
of the identity and status of the purchaser of such prescription drugs and/or
related items and in accordance with all applicable Healthcare Laws and
Contracts.  (g)Status of Persons. 
Neither the Acquired Entities nor, to the Knowledge of Sellers, their
respective officers, managers or directors: 
(1) has been convicted of or charged with any violation of any Law
related to any Governmental Program; (2) has been convicted of, charged with,
or received a notice of being investigated for any violation of Law related to
fraud, theft, embezzlement, breach of fiduciary responsibility, financial
misconduct, obstruction of an investigation, or  37


controlled substances; or (3) is excluded, suspended
or debarred from participation, or is otherwise ineligible to participate, in
any Government Program or has been convicted of violating any Law that is reasonably
expected to serve as the basis for any such exclusion, suspension, debarment or
other ineligibility.  (h)Manufacturer Discounts and Rebates. 
The Acquired Entities have properly documented, accounted for and
disclosed to its customers all manufacturer discounts, rebates, incentive
payments, administrative fees and remuneration from pharmaceutical
manufacturers and is in material compliance with Healthcare Laws (including
without limitation the provisions of ERISA), and policies and contractual requirements
of manufacturers and health plans regarding such manufacturer discounts,
rebates, incentive payments, administrative fees and remuneration.  4.23Customers and Suppliers.  Section
4.23 of the Seller Disclosure Letter sets forth a list of the client or
customers of the Acquired Entities that were among the top 10 clients or
customers and of the suppliers to the Acquired Entities that were among the top
10 suppliers and the approximate total purchases by the Acquired Entities from
each such supplier, in each case during the fiscal year ended December 31, 2008
and, separately, during the current fiscal year through March 31, 2009.  Since December 31, 2008 to the date hereof,
no customer or supplier listed on Section 4.23 of the Seller Disclosure Letter
has terminated its relationship with the Acquired Entities, as applicable, or
reduced or changed the pricing or other material terms of its business and, to
the Knowledge of Sellers, no customer or supplier listed on Section 4.23 of the
Seller Disclosure Letter has notified any of the Acquired Entities in writing
that it intends to terminate or materially reduce or change the pricing or
other material terms.  ARTICLE 5  REPRESENTATIONS AND
WARRANTIES OF BUYER  Except
as set forth in the Buyer Disclosure Letter delivered by Buyer simultaneously
with the execution of this Agreement, it being understood and agreed that each
item in a particular section of the Buyer Disclosure Letter applies only to
such section and to any other section to which its relevance is reasonably
apparent on the face of such disclosure, Buyer represents and warrants to
Sellers as follows:  5.1Organization. 
Buyer is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation.  5.2Corporate Authority; No Violation, Etc.Buyer has the requisite corporate power and authority to enter into this
Agreement and each other Transaction Agreement to which it is to be a party and
to perform its obligations hereunder and thereunder and to consummate the
Transactions.  The execution, delivery
and performance by Buyer of this Agreement and each such other Transaction
Agreement to which it is to be a party and the consummation of the Transactions
have been duly authorized by all requisite corporate action on the part of
Buyer.  This Agreement has been duly
executed and delivered by  38


Buyer and constitutes a legal, valid and binding
agreement of Buyer, enforceable against each such Person in accordance with its
terms, subject to the Bankruptcy and Equity Exception.  As of the Closing, each other Transaction
Agreement to which Buyer is to be a party will have been duly executed and
delivered by such Person and will constitute a legal, valid and binding
agreement of such Person, enforceable against it in accordance with its terms,
subject to the Bankruptcy and Equity Exception. 
None of the execution and delivery by Buyer of this Agreement or any
other Transaction Agreement to which it is or will be a party, the consummation
by Buyer of the Transactions or the compliance by Buyer with any of the
provisions hereof or thereof (a) violates or conflicts with any provisions of
Buyers certificate of incorporation or bylaws, (b) requires any consent,
approval, authorization or permit of, registration, declaration or filing with,
or notification to, any Governmental Authority or any other Person (except for (i)
filings required under any applicable Antitrust Laws, (ii) Permits as may be
required under, and other applicable requirements of, state securities laws,
and (iii) such filings and consents as may be required under any environmental,
health or safety law or regulation pertaining to any notification, disclosure
or required approval necessitated by the Transactions), (c) results in a
default (or an event that, with notice or lapse of time or both, would become a
default) or gives rise to any right of termination or buy-out by any third
party, cancellation, amendment or acceleration of any obligation or the loss of
any benefit under, any material Contract of Buyer or any of its Subsidiaries
(including Buyer), (d) results in the creation of a Lien on any of assets or
properties of Buyer or any of its Subsidiaries or (e) violates or conflicts
with any Ruling or Law applicable to Buyer or any of its Subsidiaries or any of
the properties, businesses or assets of any of the foregoing, other than such
exceptions in the case of each of clauses (b), (c), (d) and (e) above as has
not had and would not have, individually or in the aggregate, a Buyer Material
Adverse Effect.  5.3Actions; Litigation. 
No Action against Buyer, any of its Subsidiaries or their respective
businesses or properties is pending or, to Buyers Knowledge, threatened, that
has had, or could reasonably be expected to have, a Buyer Material Adverse
Effect and there is no Ruling against Buyer, any of its Subsidiaries or their
respective businesses or properties that has had, or could reasonably be
expected to have, a Buyer Material Adverse Effect.  5.4Solvency.  Assuming the
representations and warranties of the Sellers contained in this Agreement are
true in all material respects, at and immediately after the Closing, and after
giving effect to the Transactions, Buyer will be solvent (in that both the fair
value of its assets will not be less than the sum of its debts and that the
present fair saleable value of its assets will not be less than the amount
required to pay the liability on its debts as they become absolute and
matured), will have adequate capital with which to engage in its business and
will not have incurred and do not immediately plan to incur debts beyond their
ability to pay as they become absolute and matured.  5.5Financing.  Buyer has
available sufficient cash in immediately available funds to make the payments
contemplated by Section 2.4, Section 3.2(d) and Section 3.2(e) and has provided
Sellers evidence of such.  39


5.6Purchase for Own Account; Accredited
Investor.  (a)Buyer is acquiring the Shares for its own
account, not as a nominee or agent, and not with a view to the public resale or
distribution of such securities within the meaning of the Securities Act, and
has no present intention of selling, granting any participation in, or
otherwise distributing the same, and has not been formed for the specific
purpose of acquiring the Shares. Buyer is an accredited investor within the
meaning of SEC Rule 501 promulgated under Regulation D, as presently in effect.  (b)Buyer acknowledges the Shares are not
registered under the Securities Act or any applicable state securities law or
other applicable Laws, and that such Shares may not be transferred or sold
except pursuant to the registration provisions of such Securities Act or
pursuant to an applicable exemption therefrom and pursuant to states securities
laws and regulations as applicable.  5.7[Reserved]  5.8Brokers or Finders. 
Except as previously disclosed to Seller, no agent, broker, investment
banker, financial advisor or other similar Person is or will be entitled, by
reason of any agreement, act or statement by Buyer, its Subsidiaries or any of
their respective directors, officers or employees, to any financial advisory,
brokers, finders or similar fee or commission from, to reimbursement of
expenses by or to indemnification or contribution by, in each case, Buyer or
any of its Subsidiaries in connection with any of the Transactions.  ARTICLE 6  COVENANTS  6.1Conduct of the Business in the Ordinary
Course Pending the Closing.  Following the
date of this Agreement and prior to the earlier of the Closing Date or the
Termination Date, except (i) as specifically contemplated or permitted by this
Agreement or the other Transaction Agreements, (ii) as described in Section 6.1
of the Seller Disclosure Letter, and (iii) to the extent that Buyer shall
otherwise consent in writing, which consent shall not be unreasonably withheld:  (a)Ordinary Course. 
Coventry shall cause the Acquired Entities to conduct the Business, and
to not take any action except in the ordinary course of business and to use all
commercially reasonable efforts to (i) preserve intact their present business
organizations, (ii) maintain FHS Material Permits, (iii) comply in all material
respects with all applicable Laws and the requirements of all Material
Contracts, (iv) keep available the services of their key employees, (v) preserve
their relationships with customers, suppliers and others having business
dealings with them in such a manner that their goodwill and the Business are
not impaired as of the Closing, (vi) keep in full force and effect all
Policies, (vii) maintain the Acquired Assets and all of the assets and
properties of, or used by, the Acquired Entities in their current condition,
ordinary wear  40


and tear excepted, (viii) maintain the books, accounts
and records of the Acquired Entities, (ix) continue to collect accounts
receivable and pay accounts payable utilizing normal procedures and without
discounting or accelerating payment of such accounts, and (x) comply with all
contractual and other obligations of the Acquired Entities.  (b)Acquisitions. 
Coventry will not permit the Acquired Entities to, in a single
transaction or a series of related transactions, acquire or agree to acquire by
merging or consolidating with, or by purchasing any equity interest in or
assets of, or by any other manner, any business or any corporation,
partnership, association or other business organization or division thereof;  (c)Dispositions. 
Except as otherwise provided for in this Agreement, Coventry shall not
permit the Acquired Entities to, in a single transaction or a series of related
transactions, sell (including sale-leaseback), lease, pledge, encumber or otherwise
dispose of, or agree to sell (or engage in a sale-leaseback), lease (whether
such lease is an operating or capital lease), pledge, encumber or otherwise
dispose of, any of their assets, other than dispositions in the ordinary course
of business; provided, however, that no such dispositions in the
ordinary course of business that, individually, has a sale price in excess of
$50,000, or in the aggregate, has a sale price in excess of $50,000 shall be
made without reasonable prior notice to Buyer and shall not be made without
Buyers consent (which shall not be unreasonably withheld or delayed); provided,
further, that in any event, Coventry shall not permit the Sellers to
consummate or agree to consummate any such transaction with respect to the Shares.  (d)Capital Stock. 
Coventry shall not permit the Acquired Entities to issue, sell, pledge,
dispose or encumber or grant rights with respect to (whether through the
issuance or granting of any options, warrants, commitments, subscriptions,
rights to purchase or otherwise) any units, voting securities or equity
interests or any securities convertible into or exercisable or exchangeable for
units, voting securities or equity interests.  (e)Employee Arrangements. 
Except (1) as required pursuant to any collective bargaining agreements
or Contract in effect as of the date hereof and listed on Section 6.1(e) of the
Seller Disclosure Letter, (2) as contemplated by this Agreement or the other
Transaction Agreements or (3) as required by applicable Laws, Coventry shall
not permit CMS or any of the Acquired Entities to:  (i)grant any increases in the compensation
of any of the Eligible Employees, except in the ordinary course of business
consistent with past practice;  (ii)pay or agree to pay to any of the Eligible
Employees any pension, retirement allowance or other material employee benefit
not required or contemplated by any of the existing Benefit Plans as in effect
on the date hereof;  41


(iii)enter into any new, or amend any
existing, employment, severance or termination agreement or like arrangement
with any of the Eligible Employees; or  (iv)become obligated under any collective
bargaining agreement, new pension plan, welfare plan, multiemployer plan,
employee benefit plan, severance plan, benefit arrangement or similar plan or
arrangement that was not in existence on the date hereof, including any plan
that provides for the payment of bonuses or incentive compensation, trust,
fund, policy or arrangement for the benefit of any Eligible Employees or any of
their beneficiaries, or amend any such plan or arrangement in existence on the
date hereof, except in each case as would not result in a material increase in
the annual aggregate cost (based on CMS and the Acquired Entities historical
annual aggregate cost) of maintaining such collective bargaining agreement,
pension plan, welfare plan, multiemployer plan, employee benefit plan,
severance plan, trust, fund, policy or arrangement for the benefit of the
Eligible Employees or as otherwise required by applicable Law.  (f)Accounting Methods. 
Coventry shall not permit any of the Acquired Entities to make any
change in their respective financial accounting methods or procedures in effect
at December 31, 2008 (including procedures with respect to revenue recognition,
payments of accounts payable and collection of accounts receivable), except (i)
as required by changes in GAAP as concurred with by Coventrys independent
auditors, or (ii) as required by changes in the standards promulgated by the
Public Company Accounting Oversight Board, as concurred with by Coventrys
independent auditors.  (g)Tax Matters. 
Coventry shall not permit the Acquired Entities to, other than in the
ordinary course of business and consistent with past practice, make any
material Tax election or enter into any settlement or compromise of any
material Tax liability.  Coventry shall
cause the Acquired Entities to, consistent with past practice, continue to file
Tax Returns relating to the Business which are required to be filed (taking
into account any relevant extension periods) prior to the Closing and shall
pay, to the extent required, the Taxes with respect to such Tax Returns.  (h)Intellectual Property. 
Coventry shall not permit any of the Acquired Entities to sell,
transfer, license, abandon, let lapse, encumber or otherwise dispose of any
interest in Business IP, except for non-exclusive licenses granted by any of
the Acquired Entities in the ordinary course of business.  (i)No Liquidation or Dissolution. 
Coventry shall not permit the Acquired Entities to adopt a plan or
agreement of complete or partial liquidation, dissolution, merger,
consolidation, restructuring, recapitalization or other material reorganization
or any other transaction that would preclude or be inconsistent in any material
respect with, or hinder or delay in any material respect, the Transactions.  42


(j)Governing Documents. 
Coventry shall not permit any of the Acquired Entities to amend or
propose to amend or otherwise change its certificate of incorporation or
formation or bylaws or other similar governing document.  (k)Indebtedness. 
Coventry shall not permit any of the Acquired Entities to incur or
assume any indebtedness for borrowed money or guarantee any indebtedness (or
enter into a keep well or similar agreement) or issue or sell any debt
securities or options, warrants, calls or other rights to acquire any debt
securities of the Acquired Entities.  (l)Capital Expenditure. 
Coventry shall not permit any of the Acquired Entities to make any
capital expenditures, except in the ordinary course of business and in an
amount not in excess of $100,000 in the aggregate for the Acquired Entities
taken as a whole.  (m)Material Contracts. 
Coventry shall not permit any of the Acquired Entities to (i) terminate
or amend any Material Contract, or make any proposal to enter into, terminate,
or amend any customer or client Contract, or, other than in the ordinary course
of business, any other Contract that is material to the Business or the assets
and properties of the Acquired Entities, (ii) enter into or extend the term or
scope of any Contract that purports to restrict the Acquired Entities, or any
existing or future Subsidiary or Affiliate of the Acquired Entities from
engaging in any line of business or in any geographic area or that purports to
restrict the Persons to whom the Acquired Entities or any of its existing or
future Subsidiaries or Affiliates may sell products or deliver services, (iii) enter
into any Contract, that would be breached by, or require the consent of any
third party in order to continue in full force following consummation of the
Transactions, or (iv) release any Person from, or modify or waive any provision
of, any confidentiality, standstill or similar agreement or fail to take all
action necessary to enforce each such confidentiality, standstill and similar
agreement (in each case, other than any such agreement with Buyer).  (n)Litigation.  Coventry
shall not permit any of the Acquired Entities to settle or compromise any
litigation, proceeding or investigation or any claim or claims for, or that
would result in a loss of revenue of, an amount that could, individually or in
the aggregate, reasonably be expected to be greater than $100,000.  (o)Liens.  Coventry
shall not subject to any Lien or otherwise encumber or, except for Permitted
Liens, permit, allow or suffer to be encumbered, the Acquired Assets or any of
the properties or assets (whether tangible or intangible) of the Acquired
Entities.  (p)Material Changes. 
Coventry shall not introduce any material change with respect to the
operation of the Business, including any material change in the types, nature,
composition or quality of products or services, or, other than in the ordinary
course of business, make any change in product specifications or prices or
terms of distributions of products and services.  43


(q)Guarantees and Letters of Credit. 
No Guarantees or Letters of Credit shall be issued without Buyers
consent (which shall not be unreasonably withheld or delayed).  (r)Distributions. 
Coventry shall not, and shall cause the Acquired Entities not to (i) declare,
set aside, make or pay any dividend or other distribution in respect of the
capital stock of, or other ownership interests in, any of the Acquired
Entities; (ii) repurchase, redeem or otherwise acquire any outstanding shares
of the capital stock or other securities of, or other ownership interests in,
any of the Acquired Entities; or (iii) otherwise transfer Cash to any member of
the Coventry Group.  (s)No Agreements. 
Coventry shall not permit any of the Acquired Entities to agree, in
writing or otherwise, to take any of the foregoing actions, or take any action
which would (i) cause any of the representations or warranties of the Sellers
set forth in this Agreement to be untrue in any material respect or (ii) in any
material respect impede or delay the ability of the parties to satisfy any of
the conditions to the Closing set forth in this Agreement.  For
purposes of Coventry seeking to obtain the consent of Buyer where required by
any of the foregoing provisions of this Section, Buyer shall designate one
person, who shall initially be Prakash Patel, as the individual authorized to
provide the Sellers with any such consent.  6.2Access to Information Pre-Closing. 
From and after the date hereof until the earlier to occur of the Closing
Date and the Termination Date, Sellers shall afford to Buyer and its Affiliates
and each of their respective representatives (including accountants,
consultants, and counsel) full access, in each case, during normal business
hours throughout the period prior to the Closing, upon reasonable prior notice
and in such manner as will not unreasonably interfere with the conduct of the
Business, to all properties and facilities, books, financial information,
contracts, commitments and records of the Business (including Tax Returns of
the Acquired Entities, but excluding Tax Returns of a Consolidated Group) and,
during such period, shall furnish promptly such other information concerning
the Business, properties and personnel of Sellers as Buyer shall reasonably
request, together with the opportunity to discuss the Business with such
members of senior management, officers, directors, and accountants for Coventry
as Buyer and its representatives may reasonably request.  All discussions with members of management,
officers, directors, and accountants for Coventry shall be coordinated in
advance with Mike Burgoyne and Coventry shall not be required to, or to cause
any of its Subsidiaries to, grant access or furnish information to Buyer or its
Affiliates or any of their respective representatives to the extent that such
information is subject to an attorney/client or attorney work product
privilege.  All information provided
pursuant to this Agreement shall remain subject in all respects to the
Confidentiality Agreement.  Notwithstanding
the foregoing, no Party shall be required to supply any information to any
other Party pursuant to this Section 6.2 if, in the opinion of antitrust
counsel to such Party, the sharing of such information might violate applicable
Antitrust Laws.  44


6.3Access to Information Post-Closing. 
Subject to any retention requirements relating to the preservation of
Tax records, Coventry and Buyer agree that each of them shall (and shall cause
the Acquired Entities to) preserve and keep the records held by them relating
to the Business for a period of five (5) years from the Closing Date and shall
make such records and personnel available to the other as may be reasonably
required by such party in connection with, among other things, any insurance
claims by, legal proceedings against or governmental investigations of Sellers,
Coventry, the Subsidiaries or Buyer or any of their Affiliates or in order to
enable the Sellers or Buyer to comply with their respective obligations under
this Agreement and each other agreement, document or instrument contemplated
hereby or thereby.  In the event Coventry
or Buyer wishes to destroy (or permit to be destroyed) such records after that
time, such party shall first give 90 days prior written notice to the other and
such other party shall have the right at its option and expense, upon prior
written notice given to such party within that 90 day period, to take
possession of the records within 180 days after the date of such notice.  6.4Notification of Certain Matters.  (a)Coventry shall give written notice to
Buyer as promptly as reasonably practical upon becoming aware of:  (i) the occurrence, or failure to occur, of
any event, change, condition, or circumstance that would cause any
representation or warranty of Sellers contained in this Agreement or in any
other Transaction Agreement to be untrue or inaccurate in any material respect
at any time from the date of this Agreement to the Closing determined as if
such representation or warranty were made at such time, (ii) the failure of
Sellers to comply with or satisfy in any material respect any covenant,
condition or agreement to be complied with by it hereunder, (iii) any written
notice or other written communication from any Person alleging that the Consent
of such Person is or may be required in connection with the Transactions, (iv) any
written notice or other written communication from any Governmental Authority
in connection with the Transactions and (v) the institution of or the threat of
institution of any Action related to this Agreement or the Transactions, provided,
however, that the delivery of any notice pursuant to this Section 6.4(a)
shall not (x) cure any breach of any representation of warranty by Sellers or
any non-compliance by Sellers with any other provision contained in this
Agreement or (y) limit the remedies available to Buyer.  (b)Buyer shall give to Coventry prompt
written notice of:  (i) the occurrence,
or failure to occur, of any event, change, condition or circumstance of which
Buyer has Knowledge that would cause any representation or warranty of Buyer
contained in this Agreement or in any other Transaction Agreement to be untrue
or inaccurate in any material respect at any time from the date of this Agreement
to the Closing determined as if such representation or warranty were made at
such time, (ii) the failure of Buyer to comply with or satisfy in any material
respect any covenant to be complied with by it hereunder, (iii) any written
notice or other written communication from any Person alleging that the Consent
of such Person is or may be required in connection with the Transactions, (iv) any
written notice or other written communication from any Governmental Authority
in connection with the Transactions, and (v) the  45


institution of or the threat of institution of any
Action or investigation related to this Agreement or the Transactions, provided,
however, that the delivery of any notice pursuant to this Section 6.4(b)
shall not (x) cure any breach of any representation of warranty by Buyer or any
non-compliance by Buyer with any other provision contained in this Agreement or
(y) limit the remedies available to Seller under this Agreement.  6.5Governmental Consents.  (a)Subject to Coventrys and Buyers
additional obligations under paragraphs (b) and (c) below, Coventry and Buyer
will cooperate and use its commercially reasonable efforts to make, on a timely
basis, all registrations, filings and applications, to give all notices and to
obtain any governmental transfers, approvals, orders, qualifications and
waivers necessary for the consummation of the Transactions.  Buyer shall be responsible for and shall pay
all fees associated with such registrations, filings, applications, notices,
transfers, approvals, orders, qualifications and waivers, including all fees
payable in connection with the HSR Filing (as defined below).  (b)Coventry and Buyer shall duly file with
the FTC and the Antitrust Division the notification and report form (the HSR Filing) required under the HSR
Act with respect to the transactions contemplated hereby no later than the
tenth Business Day following the date hereof. 
The HSR Filing shall be in substantial compliance with the requirements
of the HSR Act.  Each party shall
cooperate with the other party to the extent necessary to assist the other
party in the preparation of its HSR Filing, to request early termination of the
waiting period required by the HSR Act and, if requested, use its reasonable
best efforts to certify as soon as practicable their substantial compliance
with any requests for additional information or documentary material that may
be made under the HSR Act.  Each of Buyer
and Coventry shall as promptly as practicable comply with the Laws of any other
Governmental Authority that are applicable to any of the Transactions and
pursuant to which any consent, approval, order or authorization of, or
registration, declaration or filing with such Governmental Authority is
necessary, but in no event shall either Coventry or Buyer make any necessary
initial filings, notifications, reports, registrations or declarations with any
such Governmental Authority or take any initial action required by such
Governmental Authority later than the tenth Business Day following the date
hereof.  Buyer and Coventry shall furnish
to each other all such information as is necessary to prepare any such
registration, declaration or filing. 
Buyer and Coventry shall keep each other apprised of the status of any
communications with, and any inquiries or requests for additional information
from, any Governmental Authority with respect to the Transactions.  Buyer and Coventry shall furnish to each
other copies of all filings made by Buyer and Coventry, as applicable, with any
Governmental Authority or any other information supplied by Buyer or Coventry,
as applicable, to a Governmental Authority in connection with this Agreement
and the Transactions; provided, however, that materials may be
redacted (i) to remove references concerning the valuation of the Acquired
Assets or the Shares and (ii) as necessary to comply with applicable Law or
contractual arrangements.  46


(c)Consistent with Section 6.5(a), each of
Buyer and Coventry agrees that it will, if necessary to enable Coventry and
Buyer to consummate the Transactions, use its commercially reasonable efforts
to defend against any Action challenging this Agreement or the consummation of
the Transactions under the Antitrust Laws, including by seeking to vacate or
reverse any temporary restraining order, preliminary injunction or other legal
restraint or prohibition entered or imposed by any court or other Governmental
Authority that is not yet final and nonappealable and by pursuing all available
avenues of administrative and judicial appeal, unless, by mutual agreement,
Buyer and Coventry decide that litigation is not in their respective best
interests.  6.6Consents and Third Party Notices.  (a)After the date hereof and prior to the
Closing, Coventry shall use its commercially reasonable efforts, to obtain at
the earliest practicable date the Consents (except for such matters covered by Section
6.5), in form and substance reasonably satisfactory to Buyer, that is required
to be obtained by the Acquired Entities in connection with the execution,
delivery and performance of this Agreement and the other Transaction
Agreements, and the Transactions.  (b)The Sellers shall, prior to the Closing
Date, (i) notify each third party to the Change In Control Customer Contracts
listed on Section 4.14(d) of the Seller Disclosure Letter of the Transactions
and (ii) request a waiver, if required, of any termination rights arising as a
result of the Transactions from each such party.  6.7Reasonable Efforts; Further Assurances.  (a)Subject to Section 6.5 and Section 6.6,
which shall govern the subject matter thereof, prior to the Closing, upon the
terms and subject to the conditions set forth in this Agreement, the Parties
shall cooperate with each other and shall use commercially reasonable efforts
to take, or cause to be taken, all actions, and to do, or cause to be done, all
things necessary, proper or advisable (subject to any applicable Law) to
consummate the Transactions as promptly as practicable.  In addition, no Party shall take any action
after the date of this Agreement with the intent of materially delaying the
obtaining of, or not obtaining, any Consent from any Governmental Authority
necessary to be obtained prior to Closing.  (b)At and after the Closing, each of the
Parties hereto agrees to use its reasonable efforts to execute and deliver, or
cause to be executed and delivered, all documents and to take, or cause to be
taken, all actions that may be reasonably requested of it by another Party and
are necessary or appropriate, in the reasonable opinion of counsel for Coventry
and Buyer, to effectuate the provisions of this Agreement.  Without limiting the generality of the
foregoing, (i) Sellers shall, upon reasonable request of Buyer, execute and
deliver such instruments of assignment or transfer, and such related notices,
as may be or become necessary to effectuate or perfect the transfer of any
Acquired Asset to Buyer or a Subsidiary of Buyer and (ii) take reasonable
actions necessary to cause any telephone numbers that have been made available
to customers or  47


clients for use in the conduct of the Business to
become available to Buyer or a Subsidiary of Buyer for such use.  In addition, in the event it is determined
that any Intellectual Property or Technology that has been used primarily in
the conduct of the Business in the ordinary course is not owned by an Acquired
Entity but such Intellectual Property or Technology is owned by the Coventry
Group, the Sellers will take all reasonable actions necessary
togrant to Buyer a
perpetual, royalty-free, fully paid-up, non-exclusive, worldwide, license to
use internally such Intellectual Property or Technology for use in the conduct
of the Business.  6.8Investigation and Agreement; No Other
Representations or Warranties.  (a)Buyer acknowledges and agrees that it has
made its own inquiry and investigation into, and, based thereon, has formed an
independent judgment concerning, the Acquired Assets and the Business, and
Buyer has been furnished with or given full access to such information about
the Acquired Assets and the Business as they requested.  In connection with Buyers investigation of
the Acquired Assets and the Business, Buyer and its representatives have
received from the Sellers, or their respective representatives, certain
projections and other forecasts for the Business and certain estimates, plans
and budget information.  Buyer
acknowledges and agrees that (i) there are uncertainties inherent in attempting
to make such projections, forecasts, estimates, plans and budgets, (ii) Buyer
is familiar with such uncertainties, and (iii) Buyer will not (and will cause
all of its respective Subsidiaries and other Affiliates and all other Persons
acting on their behalf to not) assert any claim or cause of action against
Coventry or any of its Subsidiaries or any of their direct or indirect
directors, officers, employees, agents, stockholders, Affiliates, consultants,
counsel, accountants, investment bankers or representatives with respect to
actual results differing from the information reflecting such projections,
forecasts, estimates, plans and budgets, or hold any such other Person liable
with respect thereto.  (b)Buyer agrees that, except for the
representations and warranties made by Sellers that are expressly set forth in Article
IV of this Agreement, neither Sellers nor any of their respective Affiliates
has made and shall not be deemed to have made to Buyer, or to any of its
respective representatives, any representation or warranty of any kind.  6.9Indebtedness. 
Coventry shall, and shall cause the Acquired Entities to, immediately
before the Closing, repay any FHS Outstanding Indebtedness (or, earlier before
the Closing do so in whole or in part, consistent with the operation of the
business in the ordinary course) except for Permitted Liens.  In addition, Coventry shall make arrangements
such that, at the Closing, all expenses of the Acquired Entities relating to
the Transactions, including any investment banking or broker fees and expenses
and any legal expenses and filing fees, that have not already been paid shall
be paid in full so that the Acquired Entities shall have no liability therefor.  6.10Release of Guarantees and Letters of
Credit.  Set forth in Section 6.10 of the Seller
Disclosure Letter is a list of the Guarantees and Letters of Credit.  The Parties  48


shall cooperate and use their reasonable best efforts
to (i) obtain the release, effective as of the Closing Date, of each and every
member of the Coventry Group that is a party to or bound by the Guarantees and
Letters of Credit, and (ii) cause to be issued, as promptly as practicable
after the Closing Date, letters of credit, bankers acceptances and similar
facilities on Buyers account, to replace the Letters of Credit.  In the event any of the Guarantees or Letters
of Credit are not released at the Closing, Buyer agrees to indemnify and hold
each member of the Coventry Group that is a party to each such Guarantee or
Letter of Credit harmless for any and all payments required to be made under
such Guarantee or Letter of Credit by such members of the Coventry Group
following the Closing until it is released for events that occur following the
Closing.  6.11Termination of Intercompany Agreements. 
Except as provided in Section 6.11 of the Seller Disclosure Letter,
effective as of the Closing and without any further action on the part of the
Parties hereto, (a) all Intercompany Agreements shall terminate and be of no
further force or effect and all parties shall be released from all obligations
thereunder, (b) all Intercompany Payables shall terminate, all related notes
shall be cancelled and all FHS Outstanding Indebtedness thereunder shall be
released and forgiven, and (c) all Intercompany Receivables shall terminate and
be of no further force or effect and all outstanding obligations thereunder
shall be released and forgiven.  Each
Party shall, at the reasonable request of the other Party, take, or cause to be
taken, such other actions as may be necessary to effect the foregoing.  Notwithstanding anything to the contrary
herein, the provisions of this Section 6.11 shall not apply to this Agreement
and the other Transaction Agreements.  6.12Post-closing Indemnification of Directors
and Officers.  During the period of time beginning on the
Closing Date and continuing until the date that is two (2) years after the
Closing Date, Buyer shall not, and shall cause the Acquired Entitles not to,
amend the provisions of the CMS Group Charter Documents relating to the
indemnification of directors and officers and advancement of expenses (the D&O Obligations) in any manner
that would adversely affect the rights thereunder of any Person that is as of
the date hereof an officer or director of any of the Acquired Entities.  The D&O Obligations of the Acquired
Entities shall continue during such period, provided, however,
that any Loss incurred on account thereof shall be a Buyer Indemnifiable Loss
pursuant to Article XII.  6.13Audited Financial Statements. 
If Buyer reasonably determines that Audited Financial Statements (as
defined below) are required in order to comply with its reporting obligations
relating to the Transaction arising under SEC Form 8-K, then at Buyers
request, Coventry shall promptly (in no event later than fifty (50) days
following the later of the Closing or such request) cause (i) an audit in
accordance with U.S. generally accepted auditing standards to be conducted by
its regular independent auditor of a combined balance sheet of the Acquired
Entities and, to the extent required, the Acquired Assets as at December 31,
2008 and related combined statements of income of the Acquired Entities and, to
the extent required, the Acquired Assets for the year then ended (collectively,
the Audited Financial Statements), and
(ii) deliver to Buyer the Audited Financial Statements including an unqualified
audit report of Coventrys  49


independent auditor thereon.  The Audited Financial Statements shall be
prepared in such form as shall be suitable for inclusion as an exhibit in a Form
8-K Current Report (or a Form 10-Q Quarterly Report that may be filed in lieu
of Form 8-K Current Report) required to be filed by Buyer with the SEC in
connection with the acquisition of the Acquired Entities and the Acquired
Assets and Coventry shall cooperate with Buyer in preparing the pro forma
financial statements and any unaudited interim period financial statements also
required to be included as an exhibit thereto. 
Coventry shall use its reasonable best efforts to obtain any necessary
written consent of the auditor of the Audited Financial Statements for the
inclusion of its audit report on the Audited Financial Statements in such SEC
filings by Buyer for which such consent is required in order for such audit
report to be included in such filing (the Auditors Consent).  The Buyer shall reimburse Coventry for all fees,
costs and expenses payable by Coventry or its Affiliates to Coventrys
independent registered public accounting firm in connection with the
preparation and audit of the Audited Financial Statements.  6.14Transaction Agreements. 
At or prior to the Closing, Coventry shall execute and deliver to Buyer,
and cause each of its Subsidiaries that are to be a party thereto to execute
and deliver to Buyer, the Transaction Agreements to which such Person is to be
a party and that have not previously been executed and delivered by it.  ARTICLE 7  ADDITIONAL AGREEMENTS  7.1WARN.  Each of the
Sellers shall not, and shall not permit any of its Affiliates to, at any time
within the 90-day period prior to the Closing, effectuate a plant closing or mass
layoff as those terms are defined in WARN or any state or local Law, affecting
in whole or in part any site of employment, facility, operating unit or
employee of the Business, including Eligible Employees, without notifying Buyer
in advance and without complying with the notice requirements and all other
provisions of WARN and any state or local Law.  7.2Employee Matters and Employee Benefits.  (a)Offers of Employment or Engagement. 
On or before the Closing Date, Buyer or an Affiliate of Buyer shall, or
shall cause the Acquired Entities to, immediately following the Closing Date
offer employment to any Eligible Employees who were employed by CMS immediately
prior to the Closing Date.  Such
employment shall be at base annual salaries or hourly wage rate substantially
comparable to the annual base salaries or hourly wage rate of such Eligible
Employees immediately prior to the Closing Date.  Nothing contained herein shall be construed
as requiring Buyer or any of its Affiliates to continue the employment of any
Eligible Employees.  50


(b)Employee Benefits.  (i)Buyer shall take any and all such action
as may be necessary so that, on and after the Closing Date, Eligible Employees
who after the Closing are employed by Buyer or an Affiliate of Buyer (Hired Employees) participate, as
soon as administratively feasible following the Closing Date, in the employee
benefits of the Buyer or its Affiliates, to the extent permitted under the
terms of such plans or applicable Law, provided, that Buyer shall have the
right to designate that Hired Employees participate in one or more of Buyers
health plans.  Nothing contained herein
shall be construed as requiring Buyer or any of its Affiliates to entitle the
Hired Employees to participate in all the Buyers employee benefit plans in
existence as of the Closing Date or to continue any specific employeebenefit plan
for any Hired Employees.  As of the
Closing Date, each Acquired Entity shall cease to be a participating company in
the Employee Plans, each such Hired Employees shall cease to be eligible to
participate in the Employee Plans and no further benefits shall accrue under
such Employee Plans with respect to any such Hired Employees or any beneficiary
of any such Hired Employees (other than any such beneficiary receiving health
coverage under COBRA).  Sellers shall be
responsible for any administrative costs related to the termination of the
Hired Employees participation in the Employee Plans. All contributions accrued
by the Hired Employees under the Sellers 401(k) plan with respect to all
employer contributions, including employee deferrals, matching contributions
(including any true-up contributions, if applicable), profit-sharing
contributions, employer non-elective contributions, and Seller share
contributions for the Hired Employees through the Closing Date, determined in
accordance with the terms and provisions of the Sellers 401(k) plan, ERISA and
the Code, and based on all service performed and compensation accrued prior to
the Closing Date, shall be deposited by the Sellers to the Sellers 401(k) plan
as soon as administratively feasible following the Closing Date.  On or
after the Closing Date, Buyer shall be responsible for any costs of
participation and provision of administrative services related to the Hired
Employees in Buyers employee benefit plans.  (ii)For purposes of eligibility to
participate and vesting in all benefits provided by Buyer to such Hired
Employees, each Hired Employee will be credited with his or her years of
service with the applicable Seller or Affiliate to the same extent as such
Hired Employee was entitled, before the Closing Date, to credit for such
service under any corresponding Employee Plans, except for any plan subject to
Title IV of ERISA or any plan, program or policy providing retiree health or
life benefits, or except to the extent that it would result in a duplication of
benefits.  The eligibility of any such
Hired Employee to participate in any welfare benefit plan or program of Buyer
shall not be subject to any exclusion for any pre-existing conditions if such
individual has met the participation requirements of similar benefit plans and
programs of the applicable Seller or Affiliate. 
All individuals eligible to participate in any plan or arrangement  51


contemplated above
shall be immediately eligible to participate in the similar plan or arrangement
maintained by Buyer and its Affiliates. 
Amounts paid before the Closing Date by a Hired Employee under any
health plans of Sellers or their Affiliates shall, after the Closing Date, be
taken into account in applying deductible and out-of-pocket limits applicable
under the health plans of Buyer provided as of the Closing Date to the same
extent as if such amounts had been paid by such Hired Employee under such
health plans of Buyer.  (iii)To the extent practicable, Buyer will
cause Buyers 401(k) Plan to accept a direct rollover of, or an eligible
rollover of, all or a portion of the taxable portion of a distribution of an
Eligible Employees account balance from Sellers 401(k) Plan.  (iv)Notwithstanding anything in this Agreement to the
contrary, Buyer shall not assume, and shall be deemed not to have assumed, any
liabilities arising out of, relating to or with respect to (i) the employment
or performance of services, or termination of employment or services by CMS of
any current or former employees or directors of CMS on or before the Closing
Date (including without limitation, wages or other compensation, and plans,
agreements or arrangements providing for bonus, incentive compensation,
vacation, sick days, personal days, severance benefits, or other employee
benefits), (ii) workers compensation claims against any of the Sellers except
against the Acquired Entities, irrespective of whether such claims are made
prior to or after the Closing, or (iii) any Employee Plan.  (v)The Parties acknowledge and agree that
all payroll, payroll taxes, employer taxes and withholdings (including without
limitation federal and state employee withholding taxes, employer taxes and
employer and employee FICA) that are required to be paid or withheld through
the Closing Date shall be paid by Sellers. Sellers shall pay all accrued but
unused vacation through the Closing Date, provided, that up to a maximum
of five (5) days per Hired Employee shall not be paid by Sellers and shall be
included in accrued liabilities, and thus in the FHS Working Capital, to the
extent that each such Hired Employee has five (5) days of accrued but unused
vacation immediately prior to the Closing Date.  7.3Covenants Not to Compete.  (a)Except as described in Section 7.3(b),
during the period of time beginning on the Closing Date and continuing until
four (4) years after the Closing Date, each Seller covenants and agrees that it
will not, and will cause its Affiliates and representatives (on behalf of a
Seller) not to, without the prior written consent of Buyer, directly or
indirectly, own, manage, engage in, operate, control, maintain any interest in
(proprietary, financial or otherwise) or participate in the ownership,
management, operation or control of, any business within the Designated Area in
the business of  52


pharmacy administration services to state fee-for-service
Medicaid programs (the FHS Restricted Business).  (b)Nothing contained herein shall limit the
right of any Seller, its representatives (on behalf of a Seller) or its
Affiliates to:  (i)Provide pharmacy services to state
Medicaid or other entitlement programs as part of a managed care contract;  (ii)Purchase or Acquire any entity or
substantially all of the assets of any entity that generates less than 15% of
its revenue from the FHS Restricted Business; or  (iii)Maintain any ownership interest of five
percent (5%) or less of the outstanding common stock of any publicly traded
corporation.  (c)Notwithstanding anything herein to the
contrary, this Section 7.3 shall not apply to Coventry in the event of a Change
in Control.  7.4[Reserved]  7.5[Reserved]  7.6Confidential Nature of Information. 
Each of Buyer and each Seller and their respective Affiliates shall
treat in confidence all documents, materials and other information, whether
written or oral, which it shall have obtained regarding the other parties
during the course of the negotiations leading to the consummation of the
transactions contemplated hereby (whether obtained before or after the
Effective Date), the investigation provided for herein and the preparation of
this Agreement and other related documents, and, in the event the transactions
contemplated hereby shall not be consummated, each party will return to the
other party all copies of nonpublic documents and materials which have been furnished
in connection therewith.  Such documents,
materials and information shall not be communicated to any third Person (other
than, in the case of Buyer, to its counsel, accountants, financial advisors or
lenders, and in the case of Sellers, to their counsel, accountants or financial
advisors).  No Person shall use any
confidential information in any manner whatsoever except solely for the purpose
of evaluating the transactions contemplated by this Agreement or the negotiation
or enforcement of this Agreement or any agreement contemplated hereby.  The obligation of each party to treat such
documents, materials and other information in confidence shall not apply to any
information which (i) is or becomes lawfully available to such party from a
source other than the furnishing party; (ii) is or becomes available to the
public other than as a result of disclosure by such party or its agents; or (iii)
is required to be disclosed under applicable laws, but only to the extent it
must be disclosed.  53


7.7Acquisition Proposals.  (a)On and after the date hereof and prior to
the Effective Time, Coventry agrees that it shall not invite, initiate, solicit
or encourage, directly or indirectly, any inquiries, proposals, discussions or
negotiations or the making or implementation of any proposal or offer with
respect to any direct sale, lease, exchange, mortgage, pledge, transfer,
merger, consolidation, business combination, or other disposition of any
material amount of the assets of the Acquired Entities or any capital stock or
other ownership interests of the Acquired Entities in one transaction or a
series of related transactions (any such proposal or offer being hereinafter
referred to as an Acquisition Proposal),
or engage in any discussions or negotiations with or provide any confidential
or non-public information or data to, or afford access to properties, books or
records to, any Person relating to, or that may reasonably be expected to lead
to, an Acquisition Proposal, or enter into any letter of intent, agreement in
principle or agreement relating to an Acquisition Proposal, or propose publicly
to agree to do any of the foregoing, or otherwise facilitate any effort or
attempt to make or implement an Acquisition Proposal.  (b)Notwithstanding anything herein to the
contrary, nothing in this Agreement shall prohibit any officer, director,
employee or agent of Coventry or its Affiliates from inviting, initiating,
soliciting or encouraging, directly or indirectly, any inquiries, proposals,
discussions or negotiations or the making or implementation of any proposal for
the acquisition (whether through merger, share exchange, purchase or otherwise)
of Coventry or substantially all of the assets of Coventry.  7.8Release for Pre-closing Intercompany
Liabilities.  The Coventry Group shall execute and deliver
to Buyer effective as of the Closing Date, a release substantially in the form
attached hereto as Exhibit A (the CMS Group Release)
releasing the Acquired Entities from any and all liabilities to the Coventry
Group arising prior to the Closing Date.  7.9Securities. 
Notwithstanding anything in this Agreement to the contrary, Sellers
shall use their commercially reasonable efforts to sell or liquidate before the
Closing any and all long term securities by the Acquired Entities.  In the event that any such securities have
not been sold or liquidated previously (the Unsold
Securities), Coventry shall purchase, or shall cause its
Affiliates to purchase, the Unsold Securities at their fair market value within
two (2) Business Days before the Closing Date.  ARTICLE 8  TAX MATTERS  8.1Tax Indemnification.  (a)Tax Indemnification. 
Subject to the limitations set forth in Section 12.3(c)(ii) with respect
to Buyer Indemnifiable Losses, Sellers shall jointly and severally indemnify,
defend and hold harmless the Buyer Indemnitees from and against any Losses  54


that Buyer Indemnitees may suffer, sustain or become
subject to arising out of, in connection with or resulting from (i) any Taxes
of the Acquired Entities or with respect to the Acquired Assets for any
Pre-Closing Tax Period and the portion of any Taxes of the Acquired Entities or
with respect to the Acquired Assets for any Straddle Period that is allocable
(determined in accordance with Section 8.1(c)) to the portion of the Straddle
Period ending on the Closing Date, (ii) any Taxes arising by reason of any of
the Acquired Entities being a member of any Consolidated Group on or prior to
the Closing Date, including pursuant to Treasury Regulations Section 1.1502-6(a)
(or any predecessor or successor thereof or any analogous or similar provision
of Law), (iii) without duplication, the failure of any of the representations
and warranties contained in Section 4.10 to be true and correct in all respects
(determined without regard to any qualifications related to materiality
contained therein) or the failure to perform any covenant contained in this
Agreement with respect to Taxes, and (iv) any failure by Coventry to timely pay
its portion of Transfer Taxes pursuant to Section 8.2(a) hereof.  Notwithstanding the foregoing, Coventry shall
not be required to indemnify the Buyer Indemnitees, and Buyer shall indemnify
and hold harmless the Seller Indemnitees, from any Taxes to the extent
resulting from any action taken by Buyer or the Acquired Entities after the
Closing and on the Closing Date outside of the ordinary course of business.  (b)Tax Returns and Taxes of Acquired
Entities.  (i)Coventry shall prepare and file (or cause
to be prepared and filed) all Tax Returns with respect to the Acquired Entities
for all Pre-Closing Tax Periods and shall pay all Taxes due with respect
thereto.  With respect to such Tax
Returns required to be filed after the Closing Date (other than with respect to
the Tax Returns of the Consolidated Group for which Coventry is the common
parent), Coventry shall provide, at least 35 days prior to filing such Tax
Return, a copy of such Tax Return, together with all workpapers and schedules
utilized in its preparation, to Buyer for its review, comment and approval
(which approval shall not be unreasonably withheld), and such Tax Returns shall
be prepared in a manner consistent with past practices, except as otherwise
required by applicable Law.Within 10 days
after delivery by Coventry of a copy of such Tax Returns, Buyer shall deliver
to Coventry a written notice (the Tax
Return Notice) either (A) advising Coventry that Buyer agrees
with and accepts such Tax Returns (in which event Buyer shall sign and timely
file such Tax Returns and Coventry shall timely pay all Taxes shown as due on
such Tax Returns to the appropriate Tax Authorities), or (B) advising Coventry
that Buyer disputes such Tax Returns (in which event Buyer and Coventry shall
use commercially reasonable efforts for a period of 10 days after the receipt
of the Tax Return Notice by Coventry to resolve any dispute relating to such
Tax Returns).  If the Parties cannot in
good faith resolve such dispute within such 10 day period, Buyer shall refer
the dispute relating to such Tax Returns toDeloitte and Touche LLP or such other nationally
recognized accounting firm that is reasonably acceptable to Coventry(the Tax Settlement Firm).  Buyer shall be required to sign such Tax
Returns only if Buyer is advised in writing by the Tax Settlement Firm that the
filing of such Tax  55


Returns would not subject the applicable Acquired Entity to Tax
penalties excluding late filing penalties.  
The fees, costs and expenses of the Tax Settlement Firm shall be borne
by Buyer.  (ii)Buyer shall prepare or cause to be
prepared all Tax Returns with respect to the Acquired Entities for all Straddle
Periods.  With respect to each such Tax
Return for a Straddle Period, (A) Buyer shall provide, at least 30 days prior
to filing such Tax Return, a copy of such Tax Return, together with all
workpapers and schedules utilized in its preparation, to Coventry for its
review, comment and approval (which approval shall not be unreasonably
withheld), along with a statement of the amount due from Sellers with respect
to such Tax Returns determined in a manner consistent with Section 8.1(c), and (B)
such Tax Return shall be prepared as required by applicable Law and in a manner
consistent with Section 8.1(c) and with past practices, except as otherwise
required by applicable Law.  Buyer shall
pay all Taxes due with respect to such Tax Returns, provided, however, that
Coventry shall pay to Buyer the amount of Taxes which relate to the portion of
the Straddle Period ending on the Closing Date as determined pursuant to Section
8.1(c) hereof and set forth on the statement. 
After the Closing, neither Buyer nor any of the Acquired Entities shall,
without the prior written consent of Coventry, file any amended Tax Return with
respect to any Acquired Entity for any Taxable period beginning on or prior to
the Closing Date.  (c)Allocation of Straddle Period Taxes of
Acquired Entities.  For purposes of allocating Taxes and
preparing Tax Returns of the Acquired Entities for a Straddle Period, the
portion of any Taxes of the Acquired Entities for a Straddle Period that is
allocable to the portion of the Straddle Period ending on the Closing Date
shall be:  (i)in the case of Taxes that are either (A) based
upon or related to income or receipts, or (B) imposed in connection with any
sale or other transfer or assignment of property (real or personal, tangible or
intangible), deemed equal to the amount which would be payable if the taxable
year or period ended on the Closing Date;  (ii)in the case of Taxes not described in
subparagraph (i) above that are imposed on a periodic basis and measured by the
level of any item, deemed to be the amount of such Taxes for the entire
relevant period (or, in the case of such Taxes determined on an arrears basis,
the amount of such Taxes for the immediate preceding period) multiplied by a
fraction the numerator of which is the number of calendar days in the period
ending on the Closing Date and the denominator of which is the number of
calendar days in the entire relevant period; and  (iii)for purposes of determining such Taxes,
exemptions, relief, allowances or deductions that are calculated on an annual
basis, such as the deduction for depreciation, shall be apportioned in the
manner specified in subparagraph (ii) above. 
All determinations necessary to give effect to the  56


foregoing
allocations shall be made in a manner consistent with prior practice of the
applicable Acquired Entity.  (d)Tax Refunds of the Acquired Companies. 
The amount or economic benefit of any refunds, credits or offsets of
Taxes of the Acquired Entities for any Pre-Closing Tax Period shall be for the
account of Coventry.  The amount or
economic benefit of any refunds, credits or offsets of Taxes of the Acquired
Entities for any Taxable period beginning on or after the Closing Date shall be
for the account of Buyer.  The amount or
economic benefit of any refund, credit or offset of Taxes of the Acquired
Entities for any Straddle Period shall be equitably apportioned between
Coventry and Buyer in accordance with the principles set forth in Section 8.1(c).  Each Party shall forward, and shall cause its
Affiliates to forward, to the party entitled to receive the amount or economic
benefit (net of any Taxes payable with respect thereto) of a refund, credit or
offset to Tax pursuant to this Section 8.1(d) the amount of such refund or
economic benefit within 30 days after such refund is received or such credit or
offset is allowed or applied against another Tax liability, as the case may be.  (e)Carrybacks.  Except as
otherwise provided in this paragraph, Buyer and its Affiliates shall not
carryback any net operating loss, capital loss, tax credit or other tax
attribute of any of the Acquired Entities arising in any taxable period
beginning after the Closing Date to a Pre-Closing Tax Period.  Buyer or its Affiliates may carryback any net
operating loss, capital loss, tax credit or other tax attribute of any of the
Acquired Entities arising in any taxable period beginning after the Closing
Date to a Pre-Closing Period only if (a) there is no election under applicable
Law to waive such carryback and (b) a failure to carryback would result in
Buyer or its Affiliates permanently losing the economic benefit associated with
any such net operating loss, capital loss, tax credit or other tax
attribute.  If, at Buyers request, any
such net operating loss, capital loss, tax credit or other tax attribute is
carried back as set forth herein (x) Coventry will cooperate with the Acquired
Entities in obtaining such refund (or reduction or benefit), including through
the filing of amended Tax Returns or refund claims, and (y) Coventry shall pay
to Buyer any Tax refund (or reduction in Tax liability or other Tax benefit)
resulting from a carryback of any net operating loss, capital loss, tax credit
or other tax attribute of any of the Acquired Entities arising in any taxable
period beginning after the Closing Date to a Pre-Closing Tax Period, when such
refund (or reduction or benefit) is realized by Coventry, net of the reasonable
costs incurred by Coventry to secure such refund (or reduction or benefit),
including, without limitation, costs related to the utilization of employees of
Coventry or its Affiliates.  8.2Transfer Taxes and Property Taxes on
Acquired Assets.  (a)Transfer Taxes. 
All sales, use, transfer, real property transfer, value added,
recording, registration, notary, stamp, stamp duty or similar Taxes and
fees, and all recording costs, arising out of the transfer of the Acquired
Assets and the Shares pursuant to this Agreement and all costs and expenses
incurred in connection with the transferring and recording of title to the
Acquired Assets (collectively, the Transfer
Taxes), shall be borne 50% by Buyer and 50% by Coventry.  The Tax Returns relating  57


to such Transfer Taxes shall be timely prepared by the
Party legally obligated to make such filing, and such Party will use its
commercially reasonable efforts to provide such Tax Returns to the other
Parties at least 10 days prior to the due date for such Tax Returns.  (b)Property Taxes.  (i)All ad valorem Taxes, personal property
Taxes and similar obligations attributable to the Acquired Assets with respect
to the Tax period in which the Closing Date occurs (Property Taxes) shall be apportioned
as of the Closing Date among Coventry and Buyer determined by prorating such
Property Taxes on a daily basis over the entire Taxable period.  (ii)Buyer shall pay or cause to be paid, when
due, to the appropriate Taxing Authorities all Property Taxes relating to the
Taxable period during which the Closing Date occurs.  Buyer shall send to Coventry a statement that
apportions the Property Taxes as of the Closing Date between Coventry and Buyer
based upon Property Taxes actually invoiced and paid to the Taxing Authorities
by Buyer for the Tax year which includes the Closing Date.  Within five (5) Business Days of receipt of
such statement, Coventry shall reimburse Buyer for Coventrys pro-rated portion
of such Property Taxes to the extent the aggregate amount of such Property
Taxes pro-rated to Coventry exceeds the amount of Property Taxes included as a
current liability in the FHS Working Capital, as finally determined in
accordance with Article III.  8.3Tax Claims; Cooperation on Tax Matters.  (a)Control of Tax Claims. 
Buyer shall promptly notify Coventry upon receipt of any notice of any
Tax audit, assessment, claim or investigation relating to the Acquired Entities
or the Acquired Assets for any Pre-Closing Tax Period or Straddle Period (a Tax Claim) for which Sellers and their
Affiliates may be liable, provided, however, no failure or delay
by Buyer or any of its Affiliates to provide notice of a Tax Claim shall
reduce, release, waive, or otherwise affect the obligation of Sellers or their
Affiliates hereunder except to the extent that such failure or delay has
materially and adversely affected the right of Seller or its Affiliates to
participate in and contest the Tax Claim. 
Notwithstanding any other provision in this Agreement, with respect to
any Tax Claim relating to Taxes for which Sellers or their Affiliates may be
liable, Coventry shall control all proceedings; provided, however,
that Coventry will allow Buyer to participate at its own expense in the defense
of any such Tax Claim (other than a Tax Claim relating to a Tax or Tax Return
of the Consolidated Group of which Coventry is the common parent or the
Consolidated Group in which First Health Services Corporation was included
prior to its acquisition by Coventry); provided further that
Coventry shall not enter into any compromise or agree to settle any claim
pursuant to such proceeding without written consent of Buyer, which consent
shall not be unreasonably withheld, to the extent that such compromise or
settlement may adversely affect Buyer or its Affiliates (including the Acquired
Entities) after the Closing Date.  With
respect to any Tax Claim relating to a Straddle Period and involving both Taxes
for which either Sellers or any of  58


their Affiliates are liable and Taxes for which
neither Sellers nor their Affiliates are liable, Coventry and Buyer shall
jointly control the defense of such Tax Claim and neither Coventry nor Buyer
shall enter into any compromise or agree to settle any claim pursuant to such
proceeding without prior written consent of the other Party, which consent
shall not be unreasonably withheld.  (b)Cooperation. 
The Parties shall cooperate fully, as and to the extent reasonably
requested by the other Parties in connection with the filing of Tax Returns
filed after the Closing Date and any audit, litigation, or other proceeding
with respect to Taxes.  Such cooperation
shall include the retention and (upon another Partys request) the provision of
records and information which are relevant to the filing of any Tax Return or
any filing with the SEC (including, without limitation, information regarding
tax basis and other attributes) or any such audit, litigation, or other
proceeding and making employees available on a mutually convenient basis to
provide additional information and explanation of any material provided under
this Agreement.  The Parties agree to
retain all books and records with respect to Tax matters pertinent to the
Acquired Entities and Acquired Assets relating to any Taxable period beginning
before the Closing Date until the expiration of the statute of limitations of
the respective Taxable periods, and to abide by all record retention agreements
entered into with any Taxing Authority.  (c)Mitigation.  The Parties
further agree, upon request, to use their commercially reasonable efforts to
obtain any certificate or other document from any Governmental Authority or any
other Person as may be necessary to mitigate, reduce, or eliminate any Tax that
could be imposed (including, but not limited to, with respect to the
transactions contemplated hereby).  8.4Termination of Tax Sharing Agreements. 
Any and all Tax allocation or Tax sharing agreements or other similar
agreements or arrangements with any of the Acquired Entities, whether or not
written, shall be terminated with respect to the Acquired Entities as of the Closing
Date and, after the Closing Date, the Acquired Entities shall not be obligated
to make any payment to any Person pursuant to any such agreement or arrangement
for any past or future period.  8.5Election.  Unless Buyer
provided written consent to the contrary, in connection with the transactions
contemplated by this Agreement, Sellers and their Affiliates shall not make an
election pursuant to Treasury Regulations 1.1502-36(d)(6)(i)(B) or (C) to
reattribute any portion of any tax attributes of the Acquired Entities to
Sellers or its Affiliates.  8.6Tax Treatment of Payments. 
The Parties shall treat any payments made pursuant to Section 8.1(a) as
an adjustment to the Purchase Price for federal Tax purposes, unless a final
determination causes such payment not to be treated as an adjustment to the
Purchase Price for federal Tax purposes.  8.7Exclusivity; Survival. 
The provisions of Article XII other than Sections 12.3(c)(ii), 12.3(g) and
12.5 shall not apply with respect to the obligations of Sellers  59


concerning Taxes and the provisions of this Article VIII
(subject to Section 12.3(c)(ii)) shall be the exclusive source of the rights of
the parties with respect to matters concerning Taxes.  Without limiting the generality of the
foregoing, none of the limitations on indemnification in Section 12.3 (other
than in Section 12.3(c)(ii)) shall apply with respect to indemnification under
this Article VIII.  The provisions of Section
8.1(a) shall survive until thirty (30) days following the expiration of the
applicable statute of limitations (including any extensions or waivers
thereof), except as to Section 8.1(a)(iii) for breaches of the representations
and warranties in Section 4.10, which shall survive until the expiration of the
statute of limitations.  The remaining
provisions of this Article VIII shall survive the Closing Date in accordance
with their terms.  ARTICLE 9
CLOSING  9.1Time and Place of Closing. 
Unless otherwise agreed to by Coventry and Buyer, the closing of the
transactions contemplated hereby (the Closing)
will occur at 9:00 a.m. local time on the second Business Day following the day
on which all conditions to Closing (other than conditions the fulfillment of
which is to occur at the Closing) are satisfied or waived.  The Closing shall take place at the offices
of Bass, Berry & Sims PLC in Nashville, Tennessee.  The date upon which the Closing actually
occurs is referred to as the Closing Date.  9.2Deliveries by Sellers at Closing.  At
the Closing, Coventry shall deliver or cause to be delivered to Buyer the
following:  (a)the original books and records (financial
and otherwise) of the Acquired Entities;  (b)such bills of sale and any other
appropriate instruments of sale, transfer, conveyance, assignment and delivery
covering the Acquired Assets, in form and substance reasonably acceptable to
Buyer, as may be requested by Buyer to fully and effectively transfer the
Acquired Assets to Buyer or its designee;  (c)copies of the Consents obtained pursuant
to Section 6.6;  (d)evidence reasonably acceptable to Buyer
of the release and termination of each Lien, except for Permitted Liens on the
Acquired Assets, the Shares or the properties and assets of the Acquired
Entities;  (e)counterpart signature pages to each of
the Transaction Agreements not yet executed, duly executed by Coventry and/or
each Subsidiary of Coventry a party thereto;  (f)to the extent requested by Buyer, written
resignations of the directors, managers and officers, as applicable, of each of
the Acquired Entities;  60


(g)certificates representing the Shares,
together with stock transfer forms and other appropriate forms duly endorsed in
blank and with all requisite stock transfer tax stamps attached and otherwise
sufficient to transfer the Shares to Buyer free and clean of all Liens;  (h)certificates of good standing dated not
more than 10 Business Days prior to the Closing Date with respect to each of
the Acquired Entities, issued by the Secretary of State of the state of
incorporation;  (i)copies of resolutions of the board of
directors (or equivalent governing body) of each Seller authorizing and
approving the execution and delivery of this Agreement and the other Transaction
Agreements and the performance by such Seller of its obligations hereunder and
thereunder, certified by the Secretary or such other authorized officer of such
Seller;  (j)copies of the certificate of
incorporation and bylaws (or equivalent governance documents) of each Acquired
Entity, in each case certified by the Secretary of such Acquired Entity;  (k)a certificate of a duly authorized
officer of each of the Sellers certifying that all conditions set forth in Section
10.2(a) and 10.2(b) have been satisfied (or to the extent any such condition
has been waived in accordance with the terms hereof, attaching thereto the
applicable written waiver);  (l)affidavits of non-foreign status from
each of the Sellers that comply with Section 1445 of the Code (a FIRPTA Affidavit); and  (m)a duly executed copy of the CMS Group
Release.  9.3Deliveries by Buyer at Closing. 
At the Closing, Buyer shall deliver or cause to be delivered to Sellers (i)
the Closing Date Payment by wire transfer of immediately available funds into
an account designated by Coventry in writing at least two (2) Business Days
prior to the Closing Date and (ii) counterpart signature pages to each of the
Transaction Agreements not yet executed, duly executed by Buyer.  ARTICLE 10  CONDITIONS PRECEDENT  10.1Conditions to Each Partys Obligation. 
The respective obligations of each Party to effect the transactions
contemplated hereby are subject to the satisfaction, on or prior to the Closing
Date, of the following conditions:  (a)Governmental Consents. 
All authorizations, consents, orders or approvals of, or declarations or
filings with, or expirations of waiting periods imposed by, any Governmental
Authority necessary for the consummation of the Transactions shall  61


have been obtained, occurred or been filed including,
those arising under all applicable Antitrust Laws and the applicable waiting
period under the HSR Act shall have expired or terminated; provided, however,
that this condition shall not apply to Contracts with Governmental Authorities,
which shall be subject, if applicable, to Section 10.2(f).  (b)No Injunctions. No temporary restraining order,
preliminary or permanent injunction or other order issued by any Governmental Authority
preventing the consummation of the Transactions shall be in effect (the Injunctions).  (c)No Action.  No action
shall have been taken nor any Law shall have been enacted or promulgated by any
Governmental Authority that prohibits consummation of the Transactions (the Legal Actions and together with
the Injunctions, the Restraints).  (d)Transaction Agreements. 
The Transaction Agreements shall be in full force and effect.  10.2Conditions to Obligation of Buyer. 
The obligation of Buyer to effect the transactions contemplated hereby
is subject to the satisfaction, on or prior to the Closing Date, of the
following conditions unless waived, in whole or in part, by Buyer:  (a)Representations and Warranties. 
Each of the representations and warranties of the Sellers set forth in
this Agreement that are qualified as to materiality or Material Adverse Effect
shall be true and correct in all respects as of the date of this Agreement and
as of the Closing Date as though made on and as of such time (other than such
representations and warranties that address matters only as of a particular
date, which shall be so true and correct as of such date) and the
representations and warranties of the Sellers contained in this Agreement that
are not qualified as to materiality shall be true and correct in all material
respects as of the date of this Agreement and as of the Closing Date, as though
made on and as of such date (other than such representations and warranties
that address matters only as of a particular date, which shall be so true and
correct as of such date).  Buyer shall
have received certificates signed on behalf of each of the Sellers by an
executive officer to such effect.  (b)Performance of Obligations of the Sellers. 
Each of the Sellers shall have performed or complied in all material
respects with all obligations and covenants required to have been performed or
complied with by it under this Agreement and the other Transaction Agreements
at or prior to the Closing Date.  Buyer
shall have received certificates signed on behalf of each of the Sellers by an
executive officer to such effect.  (c)Intercompany Agreements. Except as provided in Section 6.11 of
the Seller Disclosure Letter, each of the Intercompany Agreements shall have
been terminated at or prior to the Closing.  62


(d)FHS Material Adverse Effect. 
No event, change in circumstances or state of facts shall have occurred
or been discovered since the date of this Agreement that has resulted in a
Material Adverse Effect on the Business.  (e)No Litigation, Etc.There shall not be any action,
investigation, proceeding or litigation instituted, commenced, pending or
threatened by or before any Governmental Authority or arbitrator that would, or
that seeks to or is reasonably likely to, (i) restrain, enjoin, prevent,
prohibit or make illegal the acquisition of some or all of the Shares and
Acquired Assets by Buyer or the consummation of the Transactions, (ii) impose
limitations on the ability of Buyer or its Affiliates effectively to exercise
full rights of ownership of all Shares, including the right to vote all such
shares, (iii) restrain, enjoin, prevent, prohibit or make illegal Buyers or
any of its Affiliates ownership or operation of all or any material portion of
the Business, (iv) as a result of the Transactions, restrain, enjoin, prevent,
prohibit or make illegal any portion of the businesses or assets of Buyer or
any of its Subsidiaries or result in a Governmental Investigation being
commenced or continued after the Closing or in Governmental Damages being
imposed on the Acquired Entities or Buyer or any of its Affiliates, (v) as a
result of the Transactions, compel Buyer or any of its Affiliates to dispose of
any Shares or to dispose of or hold separate any material portion of the
Business or any portion of the business or assets of Buyer and its
Subsidiaries, or (vi) impose material damages (other than Governmental Damages
referred to in the foregoing clause (iv) of this sentence) on Buyer or any of
its Subsidiaries or the Acquired Entities as a result of the Transactions.  As used herein, (i) Governmental
Damages shall mean (A) any penalties or fines paid or payable
to a Governmental Authority or (B) any restitution paid or payable to a third
party, in either case as a result of the (x) conviction (including as a result
of the entry of a guilty plea, a consent judgment or a plea of nolo contendere)
of any of the Acquired Entities of a crime or (y) a settlement with a
Governmental Authority for the purpose of closing a Governmental Investigation;
provided, however, that any de minimis penalties, fines or
payments shall not be deemed to be Governmental Damages; and (ii) Governmental Investigation shall
mean an investigation by a Governmental Authority for the purpose of imposing
criminal sanctions.  (f)Required Third Parties Consents. 
Sellers shall have obtained all consents, waivers and approvals referred
to in Section 10.2(f) of the Seller Disclosure Letter, each such consent, waiver
and approval being in form and substance reasonably satisfactory to Buyer and
not requiring as a term thereof or condition thereto any adverse condition or
requirement on the conduct of business by the Acquired Entities or Buyer or any
of its Subsidiaries.  (g)CMS Group Release. 
The CMS Group Release shall be in full force and effect.  (h)Other.  All
documents, instruments, certificates or other items required to be delivered at
the Closing by Sellers pursuant to this Agreement shall have been delivered.  63


10.3Conditions to Obligations of Sellers. 
The obligation of Sellers to effect the transactions contemplated hereby
is subject to the satisfaction, on or prior to the Closing Date, of the
following conditions unless waived, in whole or in part, by Coventry:  (a)Representations and Warranties. 
Each of the representations and warranties of Buyer set forth in this
Agreement shall be true and correct in all respects as of the date of this
Agreement and as of the Closing Date as though made on and as of such time
(other than such representations and warranties that address matters only as of
a particular date, which shall be so true and correct as of such date), except
where the failure of such representations and warranties to be true and correct
has not had, individually or in the aggregate, or could not reasonably be
expected to have a Buyer Material Adverse Effect.  Coventry shall have received a certificate
signed on behalf of Buyer by an executive officer of Buyer to such effect.  (b)Performance of Obligations of Buyers. 
Buyer shall have performed or complied in all material respects with all
obligations and covenants required to have been performed or complied with by
it under this Agreement and the other Transaction Agreements at or prior to the
Closing Date, and Coventry shall have received a certificate signed on behalf
of Buyer by an executive officer of Buyer to such effect.  (c)Other.  All
documents, instruments, certificates or other items (including, without
limitation, the payments to be made at the Closing pursuant to Section 9.3(a))
required to be delivered at the Closing by Buyer pursuant to this Agreement
shall have been delivered.  10.4Frustration of Closing Conditions. 
None of the Sellers or Buyer may rely on the failure of any condition
set forth in Section 10.1, 10.2 or 10.3, as the case may be, to be satisfied as
grounds for its not consummating the Transactions when otherwise required
hereunder, if such failure was caused by such Partys failure to use its
commercially reasonable efforts to consummate the Transactions, as required by
and subject to the provisions of Section 6.7.  ARTICLE 11  TERMINATION, AMENDMENT
AND WAIVER  11.1Termination. 
This Agreement and the transactions contemplated hereby may be
terminated prior to the Closing:  (a)by mutual written consent of Buyer and
Coventry, duly authorized by each of their respective Boards of Directors (or a
duly authorized committee thereof);  (b)by Buyer if there shall have been any
breach by Sellers of any representation or warranty (or if any of the
representations or warranties of Sellers set forth in this Agreement shall fail
to be true and correct), or if the Sellers have breached or failed to perform
or adhere to any of its covenants or agreements set forth in this  64


Agreement, which breach (i) would give rise to the
failure of a condition to the Closing set forth in Section 10.2(a) or (b) hereunder
in favor of Buyer and (ii) cannot be cured, or has not been cured within 30
days (the Cure Period; for purposes of
clarification, if the failure of a condition to Closing cannot be cured, the
applicable Cure Period is zero days), following receipt by Coventry of written
notice, of such breach or failure;  (c)by Sellers if there shall have been any
breach by Buyer of any representation or warranty (or if any of the
representations or warranties of Sellers set forth in this Agreement shall fail
to be true and correct), or if Buyer has breached or failed to perform or
adhere to any of its covenants or agreements set forth in this Agreement, in
each case which breach (i) would give rise to the failure of a condition to the
Closing set forth in Section 10.3(a) or (b) hereunder in favor of Sellers and (ii)
has not been cured within the Cure Period, following receipt by Buyer of
written notice of such breach;  (d)by Buyer, if after the date of this
Agreement, there shall have occurred any events or changes in circumstances or
states of fact that have resulted in a Material Adverse Effect on the Business;  (e)by either Buyer or Sellers:  (i)if the Closing shall not have occurred on
or before November 30, 2009 (the Termination Date);
provided, however, that (A) if a Cure Period has not expired
prior to such date, then Sellers shall have the right to extend the Termination
Date to the first Business Day after the last day of such Cure Period, and (B) the
right to terminate this Agreement pursuant to this Section 11.1(e)(i) shall not
be available to any Party whose breach of this Agreement at or prior to the
Termination Date has been a cause of or resulted in the failure of the Closing
to occur on or before the Termination Date; or  (ii)if any Restraint having the effect set
forth in Section 10.1(c) shall be in effect and shall have become final and
nonappealable or if any Restraint resulting from any judicial or administrative
injunction, judgment, order or any arbitration award is in effect and, although
such injunction, judgment, order or award is subject to appeal or review and,
as a result, to being reversed, over-ruled, dissolved or revoked, in the good
faith judgment of Coventry or Buyer, as the case may be, such reversal,
over-ruling, dissolution or revocation cannot reasonably be expected to occur
before the Termination Date; provided, however, that the right to terminate
this Agreement under this Section 11.1(e)(ii) shall not be available to a party
if such Restraint was primarily due to the failure of such party to perform any
of its obligations under this Agreement.  Any
termination pursuant to this Section 11.1 (other than a termination pursuant to
clause (a) hereof) shall be effected by written notice from the Party so
terminating to the other Parties, which notice shall specify the Section hereof
pursuant to which this Agreement is being terminated.  65


11.2Effect of Termination. 
In the event of the termination of this Agreement as provided in Section
11.1, this Agreement shall forthwith become void and of no further force or effect
with no liability or obligation hereunder on the part of any Party or their
respective Affiliates, officers, directors, employees or stockholders, except Section
13.1 (Public Announcements), Section 7.6 (Confidential Nature of Information), Section
6.13 (Audited Financial Statements, as it relates to Buyers obligation to
reimburse Coventry for all audit fees, costs and expenses), Article XI and Article
XIII shall survive such termination and the liability of any Party for any
willful breach by such Party of the representations, warranties, covenants or
agreements of such Party set forth in this Agreement occurring prior to the
termination of this Agreement shall survive the termination of this Agreement
and the non-breaching Party shall be entitled to pursue any and all legally
available remedies and to seek the recovery of all losses, liabilities, damages
costs and expenses of every kind and nature (including reasonable attorneys
fees).  ARTICLE 12  INDEMNIFICATION  12.1Survival.  (a)The representations and warranties in
this Agreement or made pursuant to this Agreement shall terminate and shall
expire at 11:59 p.m. on the date that is 21 months after the Closing Date;
provided, however, (i) that the representations and warranties of the Sellers
set forth in Sections 4.3 (Ownership of Interests and Stock; Subsidiaries),
4.10 (Tax Matters) and 4.4(c) and (d) (Title to and Condition of Assets)
(collectively, the Fundamental
Representations) shall survive the Closing until the expiration
of the applicable statute of limitations with respect to a claim by a third
party that, if true, would constitute a breach of such representation and
warranty; and (ii) the representations and warranties with respect to the
Sellers set forth in Section 4.22 (Health Care Regulatory Compliance) shall
survive the Closing and shall expire at 11:59 p.m. on the date that is the
fourth anniversary of the Closing; provided, further that such
expiration shall not affect the Parties rights and obligations as to any
claims asserted prior to such time.  The
right of an Indemnified Party (as defined below) to assert any new claim for
indemnification under this Article XII after the expiration of the above
survival period shall terminate.  (b)All covenants and agreements made by the
parties to this Agreement that contemplate performance following the Closing
Date shall survive the Closing Date in accordance with their terms.  All covenants and agreements that contemplate
performance prior to the Closing Date shall not survive the Closing Date; provided,
however, that if any such covenant or agreement is breached on or prior
to the Closing Date, the non-breaching party shall retain all rights and
remedies hereunder with respect to such breach following the Closing Date.  66


12.2Indemnification by the Parties.  (a)Indemnification by Sellers. 
Subject to the limitations set forth in this Article XII, Sellers shall
jointly and severally indemnify, defend and hold harmless Buyer and its Affiliates,
including the Acquired Entities (all such persons, collectively, the Buyer Indemnitees) from and
against any Buyer Indemnifiable Losses arising out of, in connection with or
resulting from:  (i)any breach or inaccuracy of any
representation and warranty made by Sellers under Article IV of this Agreement
(other than Section 4.10 (Tax Matters) which shall be governed exclusively by Article
VIII) or any certificate delivered pursuant to Section 10.2(a) of this
Agreement;  (ii)any nonfulfillment or breach of any
covenant, agreement or obligation to be performed by Sellers prior to, at or
after the Closing pursuant to this Agreement (other than any covenant,
agreement or obligation with respect to Taxes, which shall be governed
exclusively by Article VIII);  (iii)any financial advisory, brokers, finders
or similar fee, commission, reimbursement of expenses, indemnification or
contribution payable as a result of any agreement, act or statement by Coventry
or any of its Subsidiaries with respect to the Transaction;  (iv)any payment made by an Acquired Entity,
as contemplated by Section 6.12; or  (v)the defense or settlement of, or any
damages or other liabilities sustained by an Acquired Entity as a result of a
judgment or order entered in, (A) the litigation captioned Jerry Beeman, et al.
v. First Health Services Corporation referred to in Section 4.7 of the Seller
Disclosure Letter and (B) the litigation captioned Melanie Purple v. First
Health Services Corporation referred to in item Section 4.7 of the Seller
Disclosure Letter.  (b)Indemnification by Buyer. 
Subject to the limitations set forth in this Article XII, Buyer shall
indemnify, defend and hold harmless Coventry and its Affiliates (all such
Persons, collectively, the Seller Indemnitees)
from and against any Losses the Seller Indemnitees may suffer, sustain or
become subject to (Seller Indemnifiable
Losses; Buyer Indemnifiable Losses and Seller Indemnifiable
Losses, as the context requires, are sometimes referred to herein as Indemnifiable Losses), arising out
of, in connection with or resulting from:  (i)any breach or inaccuracy of any
representation and warranty made by Buyer under Article V or any certificate
delivered pursuant to Section 10.3(a);  67


(ii)any nonfulfillment or breach of any
covenant, agreement or obligation to be performed by Buyer, prior to, at or
after the Closing pursuant to this Agreement; or  (iii)any financial advisory, brokers, finders
or similar fee, commission, reimbursement of expenses, indemnification or
contribution payable as a result of any agreement, act or statement by Buyer or
any of its Subsidiaries with respect to the Transaction.  (c)Indemnified Parties and Indemnifying
Parties.  As the context requires, a Buyer Indemnitee
when entitled to indemnity hereunder and a Seller Indemnitee when entitled to
indemnity hereunder is sometimes referred to herein as an Indemnified
Party and a Seller when required to provide indemnity hereunder
and the Buyer when required to provide indemnity hereunder is sometimes
referred to herein as the Indemnifying Party.  12.3Limits on Indemnification.  (a)Sellers shall not have any obligation to
indemnify Buyer Indemnitees with respect to any Buyer Indemnifiable Losses
arising under Section 12.2(a) until Buyer Indemnitees shall first have suffered
aggregate Buyer Indemnifiable Losses in excess of $500,000 (the Deductible) (at which point,
subject to the limitations set forth in this Article XII, Sellers shall only be
obligated to indemnify Buyer Indemnitees for all such Buyer Indemnifiable
Losses to the extent that such Losses are in excess of the Deductible); provided,
the Deductible limitation shall not apply to Buyer Indemnifiable Losses arising
(i) out of a breach of any Fundamental Representation, (ii) under Article VIII
(Tax Matters), (iii) under Section 6.12 (Post-closing Indemnification of
Directors and Officers) or (iv) under Section 12.2(a)(v).  (b)Buyer shall not have any obligation to
indemnify Seller Indemnitees with respect to any Seller Indemnifiable Losses
arising under Section 12.2(b) until Seller Indemnitees shall first have
suffered aggregate Seller Indemnifiable Losses in excess of the Deductible (at
which point, subject to the limitations set forth in this Article XII, Buyer
shall only be obligated to indemnify Seller Indemnitees for all such Seller
Indemnifiable Losses to the extent that such Losses are in excess of the
Deductible); provided, the Deductible limitation shall not apply to Seller
Indemnifiable Losses arising (i) out of a breach of Section 6.10 or (ii) under Article
VIII (Tax Matters).  (c)(i)Other than Losses arising out of a breach of a
Fundamental Representation or Losses arising under Article VIII (Tax Matters),
the aggregate liability of Sellers for Buyer Indemnifiable Losses arising under
Section 12.2 shall not exceed $15,000,000 (the Cap).  (ii)Sellers aggregate liability for all
Buyer Indemnifiable Losses shall not in any case exceed the Purchase Price, except that any Buyer  68


Indemnifiable Losses to
which Buyer is entitled to indemnity pursuant to Section 8.1(a)(ii) shall be
excluded for purposes of applying such limitation.  (iii)Other than Losses arising out of a breach of Section 6.10
or under Article VIII (Tax Matters), Buyers aggregate liability for all Seller
Indemnifiable Losses arising under Section 12.2(b) shall not exceed the
Cap.  In no event shall Buyers aggregate
liability for all Seller Indemnifiable Losses exceed the Purchase Price.  (d)For purposes of calculating Losses
hereunder, after a breach or failure by the Sellers referred to in Section 12.2(a)(i)
or by Buyer referred to in Section 12.2(b)(i) has been established, any
materiality or Material Adverse Effect qualifications in the representations
and warranties shall be ignored for purposes of determining the amount of the
Loss.  (e)The Indemnified Party shall take and
shall cause their respective Affiliates to take all reasonable steps to mitigate
and otherwise minimize the Indemnifiable Losses pursuant to this Article XII or
Article VIII to the extent required by applicable Law.  (f)The provisions of this Article XII are
not intended to provide a Party (or its Affiliates), in connection with a claim
hereunder for indemnification by such Party (or its Affiliates) in respect to a
breach of a representation, warranty or covenant hereunder by another Party,
indemnity against damages resulting from the breach to the extent the damages
were not reasonably foreseeable to result from such breach; it being understood
and agreed that indemnity shall be accorded in accordance with this Article XII
against Losses sustained by an Indemnified Party as a result of a Third Party
Claim even if, and to the extent, such Losses include an award of damages to a
third party that were not reasonably foreseeable.  It is understood and agreed that it is
reasonably foreseeable that a breach of a representation or warranty set forth
in Section 4.14 (Material Contracts) or Section 4.23 (Customers and Suppliers)
or the giving or a failure to give notification relating thereto, required by
Coventry under Section 6.4(a)(i) may result in a Loss of Profits by an Acquired
Entity and, to the extent an Acquired Entity sustains a Loss of Profits as a
result of such a breach, indemnity against such Loss shall be accorded in
accordance with (and subject to the limitations provided by) this Article XII
(in addition to indemnity against other forms of Losses sustained).  For purposes hereof, Loss of
Profits means lost revenue to the Business from a customer
contract (net of expenses, including Taxes, that would have been incurred to
realize such lost revenue) resulting from the breach of a representation or
warranty set forth on Section 4.14 (Material Contracts) or Section 4.23
(Customers and Suppliers) or the giving or the failure to give a notification
relating thereto required by Section 6.4(a)(i).  (g)THE RIGHTS OF INDEMNITY PROVIDED IN THIS
ARTICLE XII AND IN ARTICLE VIII SHALL BE AN INDEMNIFIED PARTYS SOLE AND
EXCLUSIVE REMEDY AFTER THE CLOSING RELATING IN ANY WAY TO A BREACH OF THIS
AGREEMENT, EXCEPT FOR LOSSES ARISING FROM OR ATTRIBUTABLE TO ANY WILLFUL BREACH
OR FRAUD.  Each Indemnified  69


Party waives all other rights and claims that such
Person may otherwise have, whether in Law or in equity, relating in any way to
a breach of this Agreement, including claims for contribution, breach of
contract, breach of representation or warranty, negligent or intentional
misrepresentation or breach of duty.  (h)The Parties shall treat any payments made
pursuant to this Article XII or Article VIII as an adjustment to the Purchase
Price for federal Tax purposes, unless a final determination causes such
payment not to be treated as an adjustment to the Purchase Price for federal
Tax purposes.  (i)The Buyer Indemnitees shall not be
entitled to recover any amounts under this Article XII to the extent included
as a current liability or current reserve on the FHS Closing Date Balance Sheet
as finally determined pursuant to Section 3.2.  12.4Matters Involving Third Parties.  (a)If any third party shall notify any
Indemnified Party with respect to any matter (a Third
Party Claim) which may give rise to a claim for indemnification
against an Indemnifying Party under this Article XII, then the Indemnified
Party shall promptly notify the Indemnifying Party thereof in writing; provided,
however, that the failure to so notify an Indemnifying Party shall not
affect the rights of the Indemnified Party to indemnity hereunder except to the
extent the Indemnifying Party is prejudiced by such failure.  (b)Except as otherwise provided by Article VIII
with respect to a proceeding with respect to a Tax Claim relating to Taxes for
which Sellers or their Affiliates may be liable and subject to Section 12.4(d),
the Indemnifying Party shall have the right to defend the Indemnified Party
against the Third Party Claim with counsel of the Indemnifying Partys choice,
reasonably satisfactory to the Indemnified Party, so long as (i) the
Indemnifying Party notifies the Indemnified Party, within 15 days after the
Indemnified Party has given notice of the Third Party Claim, that the
Indemnifying Party is assuming the defense of such Third Party Claim and (ii) the
Indemnifying Party conducts the defense of the Third Party Claim in an active
and diligent manner.  In the event that
the Indemnifying Party fails to assume the defense of any Third Party Claim
within 15 days after receipt of notice of the Third Party Claim, the
Indemnified Party shall have the right to undertake the defense of such Third
Party Claim at the expense and for the account of the Indemnifying Party in
accordance with this Article XII.  (c)So long as the conditions set forth in Section
12.4(b) are and remain satisfied, then (i) the Indemnifying Party may conduct
the defense of the Third-Party Claim in accordance with Section 12.4(b), (ii) the
Indemnified Party may retain separate co-counsel at its sole cost and expense
to represent it in connection with the Third Party Claim and the Indemnifying
Party shall cooperate, and cause the counsel selected by the Indemnifying
Party, to cooperate with such co-counsel in connection with the response,
defense and settlement of such Third Party Claim and any related suit or
proceeding and (iii) the Indemnifying Party shall not, without the prior
written consent of  70


the Indemnified Party (which consent shall not be
unreasonably withheld or delayed), consent to any admission or the entry of any
judgment with respect to the matter, or enter into any settlement which (A) imposes
an injunction or other equitable relief upon the Indemnified Party or (B) does
not include an unconditional provision whereby the plaintiff or claimant in the
matter releases the Indemnified Party from all liability with respect to such
matter.  (d)Notwithstanding anything in this Section 12.4
to the contrary, Sellers shall not have the right to assume the defense of any
Third Party Claim against the Buyer or any of its Affiliates, including the
Acquired Entities, in respect of which the Buyer Indemnified Parties may be
entitled to indemnity in accordance with this Article XII if such Third Party
Claim (i) involves as a claimant a client or customer or supplier listed in Section
4.14 of the Seller Disclosure Letter, (ii) is a criminal investigation or
proceeding or (iii) involves any other investigation or inquiry by any
Governmental Authority.  In each such
case, the Buyer (on its own behalf or on behalf of any other Buyer Indemnitees
if such claim, assertion, action or proceeding involves another Buyer
Indemnitee) shall direct, through counsel of its own choosing reasonably
acceptable to the Sellers, the response to, defense of or settlement of any
such claim, assertion, investigation, inquiry, action or proceeding, but the
cost thereof and any other Loss resulting therefrom shall be a Buyer
Indemnifiable Loss in accordance with the Article XII.  The Buyer Indemnitee shall not, however,
without the prior written consent of the Sellers (which consent shall not be
unreasonably withheld or delayed), consent to the entry of any judgment with
respect to any such matter or enter into any settlement thereof if Sellers are
required to provide indemnity hereunder with respect to any Loss resulting from
such judgment or settlement.  Buyer shall
consult with Sellers for the purpose of allowing Sellers to participate in the
response, defense or settlement of any such claim, assertion, investigation,
inquiry, action or proceeding, but in such case, the expenses of Sellers,
including the fees and disbursements of its counsel, shall be paid by
Sellers.  If Sellers shall determine to be
represented by counsel in connection with any such claim, assertion,
investigation, inquiry action or proceeding, the Buyer Indemnitee shall
cooperate, and cause the counsel representing it in such proceeding to
cooperate, with counsel representing Sellers in such proceeding and Buyer shall
provide and shall cause its Subsidiaries to provide (during normal business
hours) Sellers and their counsel with reasonable access to the records and
personnel of the Acquired Entities and Buyer relating to any such claim,
assertion, investigation, inquiry, action or proceeding as to which Sellers may
be required to provide indemnity hereunder to the extent reasonable for Sellers
to participate in the response, defense or settlement thereof.  12.5Indemnification Notices.  (a)In order to obtain indemnity in respect
of a Loss as provided by Section 12.2 or under Article VIII, an Indemnified
Party shall give an Indemnification Notice
to the Indemnifying Party.  For the
purposes hereof, an Indemnification Notice shall mean a notice signed by any
officer of Indemnified Party and delivered to Indemnifying Party and (i) stating
that the Indemnified Party has paid, incurred, sustained or accrued, or
reasonably anticipates that it will be obligated to pay, incur, sustain or  71


accrue, a Loss against which it is entitled to
indemnity, (ii) specifying in reasonable detail the nature of such Loss
(including the calculation thereof or the basis for estimation thereof), the
date insofar as practicable such Loss was paid or is expected to be incurred,
sustained or accrued or the basis on which it anticipates incurring, sustaining
or accruing such Loss, and the nature of the misrepresentation, breach of
warranty or covenant resulting in such Loss or out of which such Loss arose or
to which such Loss relates, and (iii) the amount of cash to be delivered to the
Indemnified Party (for the benefit of the pertinent Indemnitee) as indemnity
against each such Loss.  If a Loss is
anticipated but not yet incurred, sustained or accrued at the time an
Indemnification Notice is given, an additional Indemnification Notice shall be
given providing such information regarding the Loss incurred, sustained or
accrued as was not included in an earlier Indemnification Notice.  In a case where a Buyer Indemnitee or Seller
Indemnitee, as the case may be, other than Buyer or Coventry shall seek to
obtain the indemnity provided by Section 12.2 or Article VIII, Buyer or
Coventry, as applicable, shall give an appropriate Indemnification Notice on
behalf of such Buyer Indemnitee or Seller Indemnitee.  12.6Releases.  Effective
upon the Closing, Buyer and each Acquired Entity, and each of their respective
representatives, successors and assigns (collectively, the Releasing Parties), shall be
deemed to have remised, released and forever discharged the individuals set
forth on Exhibit B hereto (collectively, the D&O
Released Parties) of and from any and all Actions which the
Releasing Parties, or any of them, now has or ever had, or hereafter can, shall
or may have, for, upon or by reason of any matter, cause or thing whatsoever,
against the D&O Released Parties, and each of them, from the beginning of
time through the Closing Date; provided, however, that this Section 12.5(b) shall
not apply to any Action that may arise from any breach by any of the D&O
Released Parties of, or the failure to properly perform, any obligation or duty
arising on the part of any of the D&O Released Parties after the date
hereof under this Agreement or any other agreement to be entered into after the
date hereof and contemplated hereby to which any of the D&O Released
Parties is a party.  ARTICLE 13  MISCELLANEOUS  13.1Public Announcement. 
The initial press release with respect to the execution and Closing of
this Agreement shall be either a joint press release or coordinated press
releases to be reasonably agreed upon by Buyer and Coventry.  Thereafter, neither Buyer nor Coventry shall
issue any press release or make any public statement with respect to this
Agreement or the other Transaction Agreements or the Transactions without the
prior written consent of the other Parties (which consent shall not be
unreasonably withheld or delayed), except that any Party may make any
disclosure required by applicable Law (including federal securities laws) or by
the applicable rules of any stock exchange on which Buyer or Coventry lists
securities.  A Party, with respect to
each such disclosure, shall provide the other Parties with prior notice and a
reasonable opportunity to review the disclosure.  72


13.2Payment of Costs and Expenses. 
Except as otherwise expressly provided in this Agreement, the Parties
shall each bear their own respective costs and expenses in connection with the
preparation, execution and performance of this Agreement, including all fees
and expenses of agents, representatives, counsel, accountants and investment
bankers.  13.3Non-Assignment; Successors and Assigns. 
No Party shall assign this Agreement or any part hereof without the
prior written consent of the other Parties; provided, however,
that Buyer may assign or delegate any or all of its rights or obligations under
this Agreement to one or more Affiliates of Buyer, provided, further,
that any Party may assign its right to receive a payment entitled to be
received by it pursuant to this Agreement. 
Subject to the foregoing, this Agreement shall be binding upon and inure
to the benefit of the Parties and their respective permitted successors and
assigns.  In the event Buyer assigns this
Agreement, Buyer will remain primarily liable for its obligations hereunder
unless expressly released in writing by Sellers.  13.4Entire Agreement. 
This Agreement (which term shall be deemed to include the exhibits and
schedules hereto and the other certificates, documents and instruments delivered
hereunder), together with the other Transaction Agreements, set forth the
entire understanding of the Parties, and supersede all prior agreements,
arrangements and communications, whether oral or written, with respect to the
subject matter hereof.  This Agreement
shall not be modified or amended except by written agreement of the Parties.  13.5Severability; Enforceability. 
If any term or other provision of this Agreement is invalid, illegal or
incapable of being enforced by any rule of law or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner materially adverse to any party.  Upon a determination that any term or other
provision is invalid, illegal or incapable of being enforced, the Parties shall
negotiate in good faith to modify this Agreement so as to effect their original
intent as closely as possible in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the maximum extent possible.  13.6Counterparts. 
This Agreement may be executed and delivered (including by facsimile
transmission) in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument, and in pleading or proving any provision of this Agreement it shall
not be necessary to produce more than one such counterpart.  13.7Notices.  Any notice, request,
consent or other instrument or thing required or permitted to be given, made,
served or delivered to any of the Parties hereto shall be in writing and shall
be deemed to have been duly given, made, served or delivered (a) on the
date delivered if delivered personally; (b) on the next Business Day
following the date of deposit (i) in United States first-class express
mail, postage prepaid or (ii) with an overnight courier service
guaranteeing next-Business Day delivery; or (c) on the date of  73


facsimile transmission if transmitted prior to 5:00 p.m.
local time of the recipient on a Business Day (provided that confirmation of
receipt of such telecopy transmission is confirmed by the recipient on such
date), otherwise on the next Business Day; in any case addressed or transmitted
as follows (or in accordance with a partys instructions specified in a notice
given pursuant to this Section 13.7):  If to Sellers, to:  Coventry Health Care, Inc.
6705 Rockledge Dr., Suite 100
Bethesda, MD  20817
Attention:  Drew Asher
Facsimile:  (301) 493-0780  With a copy (which shall
not constitute effective notice) to  Bass, Berry &
Sims PLC
Regions Center
315 Deaderick Street, Suite 2700
Nashville, TN  37238
Attention: Bob F. Thompson
Facsimile: (615) 742-2762
and
Attention: Angela Humphreys
Facsimile: (615) 742-2718  If to Buyer, to:  Magellan Health Services, Inc.
55 Nod Road
Avon, Connecticut  06001
Attention:  Daniel N. Gregoire, Executive
Vice President,
General Counsel and Secretary
Telephone:  (860) 507-1906
Facsimile:  (860) 507-1990  With copies to:  Weil, Gotshal &
Manges LLP
767 Fifth Avenue
New York, NY  10153
Attention:  Robert L. Messineo
Raymond O. Gietz
Telephone:  (212) 310-8000
Facsimile:  (212) 310-8007  74


13.8Waiver.  (a)The rights and remedies of the Parties to
this Agreement are cumulative and not alternative.  Neither the failure nor any delay by any
Party in exercising any right, power, or privilege under this Agreement or the
documents referred to in this Agreement will operate as a waiver of such right,
power, or privilege, and no single or partial exercise of any such right,
power, or privilege will preclude any other or further exercise of such right,
power, or privilege or the exercise of any other right, power, or privilege.  (b)To the maximum extent permitted by
applicable law:  (i)no claim or right arising out of this
Agreement or the documents referred to in this Agreement can be discharged by
one Party, in whole or in part, by a waiver or renunciation of the claim or
right unless in writing signed by the other Parties;  (ii)no waiver that may be given by a Party
will be applicable except in the specific instance for which it is given; and  (iii)no notice to or demand on one Party will
be deemed to be a waiver of any obligation of such Party or of the right of the
Party giving such notice or demand to take further action without notice or
demand as provided in this Agreement or the documents referred to in this
Agreement.  13.9Third Parties. 
This Agreement shall not confer any rights or remedies upon any Person
other than the Parties and their respective successors and permitted assigns,
the Hired Employees as provided in Article VII and the Indemnified Party
as provided in Article XII.  13.10Rules of Construction.  (a)Each of the Parties hereto acknowledges
that it has been represented by independent counsel of its choice throughout
all negotiations that have preceded the execution of this Agreement and that it
has executed the same with consent and upon the advice of said independent
counsel.  Each Party and its counsel
cooperated in the drafting and preparation of this Agreement and the documents
referred to herein, and any and all drafts relating thereto exchanged between
the Parties shall be deemed the work product of the Parties and may not be
construed against any Party by reason of its preparation.  Accordingly, any rule of law or any
legal decision that would require interpretation of any ambiguities in this
Agreement against any Party that drafted it is of no application and is hereby
expressly waived.  (b)Notwithstanding anything contained in
this Agreement to the contrary, except as otherwise expressly provided in this
Agreement, the Parties hereto covenant and agree that no amount shall be (or is
intended to be) included, in whole or in  75


part (either as an increase or a reduction), more than
once in the calculation of any calculated amount pursuant to this Agreement if
the effect of such additional inclusion (either as an increase or a reduction)
would be to cause such amount to be over- or under-counted for purposes of the
transactions contemplated by this Agreement.  13.11Governing Law.  (a)This Agreement shall be construed in
accordance with, and governed in all respects by, the internal laws of the
State of Delaware (without giving effect to principles of conflicts of laws).  (b)Any legal action or other proceeding relating
to this Agreement or the enforcement of any provision of this Agreement shall
be brought or otherwise commenced exclusively in the Court of Chancery or
federal court located in the State of Delaware. 
Each Party:  (i)expressly and irrevocably consents and
submits to the jurisdiction of the Court of Chancery and federal court located
in the State of Delaware (and each appellate court located in the State of
Delaware), in connection with any proceeding;  (ii)agrees that service of any process,
summons, notice or document by U.S. mail addressed to him at the address set
forth in Section 13.7 shall constitute effective service of such process,
summons, notice or document for purposes of any such proceeding;  (iii)agrees that the Court of Chancery and federal
court located in the State of Delaware, shall be deemed to be a convenient
forum; and  (iv)agrees not to assert (by way of motion,
as a defense or otherwise), in any such proceeding, any claim by any Party that
it is not subject personally to the jurisdiction of such court, that such
proceeding has been brought in an inconvenient forum, that the venue of such
proceeding is improper or that this Agreement or the subject matter of this
Agreement may not be enforced in or by such court.  13.12Non-Recourse. 
No past, present or future director, officer, employee, incorporator,
member, partner, stockholder, Affiliate, agent, attorney or representative of
Buyer or its Affiliates shall have any liability for any obligations or
liabilities of Buyer under the Transaction Agreements of or for any claim based
on, in respect of, or by reason of, the transactions contemplated hereby and
thereby.  13.13Specific
Performance.  The Parties acknowledge and agree that the
breach of this Agreement would cause irreparable damage to the non-breaching
Party and that the non-breaching Party will not have an adequate remedy at
law.  Therefore, the obligations of the
Parties under this Agreement, including Sellers obligation to sell the  76


Acquired Assets and Shares to Buyer and Buyers
obligation to purchase the Acquired Assets and the Shares, shall be enforceable
by a decree of specific performance issued by any court of competent
jurisdiction, and appropriate injunctive relief may be applied for and granted
in connection therewith.  Such remedies
shall, however, be cumulative and not exclusive and shall be in addition to any
other remedies which any party may have under this Agreement or otherwise.  [Signature
Page Follows.]  77


IN
WITNESS WHEREOF, the Parties have executed this Agreement as of the date first
above written.   MAGELLAN HEALTH SERVICES, INC.By:
  /s/ Rene LererName:
  Rene LererTitle:
  Chairman and CEOCOVENTRY HEALTH CARE, INC.By:
  /s/ Drew AsherName:
  Drew AsherTitle:
  SVPCOVENTRY MANAGEMENT SERVICES,
  INC.By:
  /s/ Shirley R. SmithName:
  Shirley R. SmithTitle:
  SecretaryFIRST HEALTH GROUP CORP.By:
  /s/ Shirley R. SmithName:
  Shirley R. SmithTitle:
  Secretary