UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
  Form 10-K
  þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal
    year ended December 31,
    2009oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission File Number
    001-31574
 AMERIGROUP
    Corporation
 (Exact name of registrant as
    specified in its charter)
  Delaware(State or Other Jurisdiction
    of Incorporation or Organization)4425 Corporation Lane, Virginia Beach, Virginia(Address of principal
    executive offices)

54-1739323(I.R.S. Employer
    Identification No.)23462(Zip
    Code)   Registrants telephone number, including area code:
 (757) 490-6900
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, $.01 par value

New York Stock Exchange   þ o
  o þ
  þ o
  Regulation S-T o o
  Regulation S-K Form 10-K 10-K. o
  Rule 12b-2
  Large accelerated
    filer  þ

Accelerated
    filer  oNon-accelerated
    filer  o (Do
    not check if smaller reporting company)

Smaller reporting
    company  o   Rule 12b-2 o þ
      Class

Outstanding at February 19, 2010Common Stock, $.01 par value

51,089,296   Documents
    Incorporated by Reference
  Document

Parts Into Which IncorporatedProxy Statement for the Annual Meeting of Stockholders
    to be held May 13, 2010 (Proxy Statement)

Part III




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TABLE OF
    CONTENTS
   
 PagePART I.Item 1.


Business


3Item 1A.


Risk Factors


22Item 1B.


Unresolved Staff Comments


35Item 2.


Properties


35Item 3.


Legal Proceedings


36Item 4.


Submission of Matters to a Vote of Security
    Holders


37PART II.Item 5.


Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


39Item 6.


Selected Financial Data


42Item 7.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


44Item 7A.


Quantitative and Qualitative Disclosures About
    Market Risk


63Item 8.


Financial Statements and Supplementary Data


66Item 9.


Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


106Item 9A.


Controls and Procedures


106Item 9B.


Other Information


107PART III.Item 10.


Directors, Executive Officers and Corporate
    Governance


109Item 11.


Executive Compensation


109Item 12.


Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


109Item 13.


Certain Relationships and Related Transactions,
    and Director Independence


109Item 14.


Principal Accountant Fees and Services


109PART IV.Item 15.


Exhibits and Financial Statement Schedules


110   1




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Forward-looking
    Statements
  Form 10-K, time-to-time,
    
    our inability to manage medical costs;
    our inability to operate new products and markets at expected
    levels, including, but not limited to, profitability, membership
    and targeted service standards;
    local, state and national economic conditions, including their
    effect on the premium rate increase process and timing of
    payments;
    the effect of government regulations and changes in regulations
    governing the healthcare industry;
    changes in Medicaid and Medicare payment levels and
    methodologies;
    increased use of services, increased cost of individual
    services, pandemics, epidemics, the introduction of new or
    costly treatments and technology, new mandated benefits, insured
    population characteristics and seasonal changes in the level of
    healthcare use;
    our ability to maintain and increase membership levels;
    our ability to enter into new markets or remain in our existing
    markets;
    changes in market interest rates or any disruptions in the
    credit markets;
    our ability to maintain compliance with all minimum capital
    requirements;
    liabilities and other claims asserted against us;
    demographic changes;
    the competitive environment in which we operate;
    the availability and terms of capital to fund acquisitions,
    capital improvements and maintain capitalization levels required
    by regulatory agencies;
    our ability to attract and retain qualified personnel;
    the unfavorable resolution of new or pending litigation; and
    catastrophes, including acts of terrorism or severe weather.  Risk Factors
 2




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##### 



PART I. Item 1.
    Business  Overview
      Background
  Publicly
    Sponsored Healthcare in the United States Today
     3




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##### 



Changing
    Dynamics in Medicaid
            out-of-pocket
  Medicaid
    Program
  time-to-time.
    
    mandating Medicaid enrollment into managed care,
    utilizing a central broker for enrollment into plans,
    using cost savings to provide additional services, and
    limiting the number of providers for additional services. 4




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##### 



Medicaid,
    CHIP and FamilyCare Eligibles
        Form 10-K,
     5




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##### 



Medicare
    Advantage
  fee-for-service
  Medicaid
    Funding
           6




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##### 




    number of eligible individuals who enroll,
    price of medical and long-term care services,
    use of covered services,
    state decisions regarding optional services and optional
    eligibility groups, and
    effectiveness of programs to reduce costs of providing benefits,
    including managed care.    Medicare
    Funding
      Regulation
    State
    Insurance Holding Company Regulations
  and/or
   7




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Contractual
    and Regulatory Compliance
  Medicaid
       8




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Medicare
          Fraud
    and Abuse Laws
       9




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##### 



and/or qui tam Qui tam qui tam
  qui tam
    Our
    Approach
    Government
    Agencies
  24-hour
  Providers
   10




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Members
    Communities
      Competition
    
    Traditional
    Fee-for-Service 
    Original unmanaged provider payment system whereby state
    governments pay providers directly for services provided to
    Medicaid and Medicare eligible beneficiaries.
    Primary Care Case Management Programs  Programs
    established by the states through contracts with physicians to
    provide primary care services to Medicaid recipients, as well as
    provide limited oversight over other services.
    Administrative Services Only Health Plans  Health
    plans that contract with the states to provide administrative
    services only (ASO) for the traditional
    fee-for-service
    Medicaid program.
    Multi-line Commercial Health Plans  National and
    regional commercial managed care organizations that have
    Medicaid and Medicare members in addition to members in private
    commercial plans. 11




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
    Medicaid Health Plans  Managed care organizations
    that focus solely on serving people who receive healthcare
    benefits through Medicaid.
    Medicare Health Plans  Managed care organizations
    that focus solely on serving people who receive healthcare
    benefits through Medicare. These plans also may include Medicare
    Part D prescription coverage.
    Medicare Prescription Drug Plans  These plans offer
    Medicare beneficiaries Part D prescription drug coverage
    only, while members of these plans receive their medical
    benefits from Medicare
    Fee-For-Service.        Products
      December 31,Product

2009


2008


2007TANF
    (Medicaid)(1)(2)


1,255,000



1,095,000



1,217,000CHIP(2)


259,000



253,000



231,000ABD
    (Medicaid)(3)


196,000



182,000



216,000Family Care (Medicaid)


63,000



40,000



42,000Medicare Advantage


15,000



9,000



5,000Total


1,788,000



1,579,000



1,711,000     (1)
    
    Membership includes approximately 129,000 members under an ASO
    contract in Tennessee in 2007. This contract terminated
    October 31, 2008.(2)
    
    Reflects a reclassification in 2008 and 2007 from CHIP to TANF
    to coincide with state classifications and current year
    presentation.(3)
    
    Membership includes approximately 13,000 members each in 2009
    and 2007 under ASO contracts in Texas; and approximately 41,000
    members under an ASO contract in Tennessee in 2007 that
    terminated October 31, 2008. There were no ASO contracts in
    effect as of December 31, 2008. 12




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Medical
    and Quality Management Programs
    ® 24-hour
    
    Analysis of healthcare utilization data  We analyze
    the healthcare utilization data of the PCPs in our network in
    order to identify PCPs who either over utilize or under utilize
    healthcare services. We do this by comparing their utilization
    patterns against benchmarks based upon the utilization data of
    their peers. If a PCPs utilization rates vary
    significantly from the norm, either above or below, we meet with
    the provider to discuss and understand their utilization
    patterns, suggest opportunities for improvement and implement an
    ongoing monitoring program.
    Medical care satisfaction studies  We evaluate the
    quality and appropriateness of care provided to our health plan
    members by reviewing healthcare utilization data and responses
    to member and physician questionnaires and grievances.
    Clinical care oversight  Each of our health plans has
    a medical advisory committee comprised of physician
    representatives and chaired by the plans medical director.
    This committee approves clinical protocols and practice
    guidelines. Based on regular reviews, the medical directors who
    head these committees develop recommendations for improvements
    in the delivery of medical care.
    Quality improvement plan  A quality improvement plan
    is implemented in each of our health plans and is governed by a
    quality management committee, which is either chaired or
    co-chaired by the medical director of the health plan. The
    quality management committee is comprised of senior management
    at our health plans, who review and evaluate the quality of our
    healthcare services and are responsible for the development of
    quality improvement plans spanning both clinical quality and
    customer service quality. These plans are developed from
    provider and membership feedback, satisfaction surveys and
    results of action plans. Our corporate quality improvement
    council oversees and meets regularly with our health plan
    quality management committees to help ensure that we have a
    coordinated, quality-focused approach relating to our members
    and providers. 13




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Provider
    Network
            Provider
    Payment Methods
      Fee-for-Service. fee-for-service fee-for-service
 14




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
    Maximum Allowable Fee Schedule  Providers are paid
    the lesser of billed charges or a specified fixed payment for a
    covered service. The maximum allowable fee schedule is developed
    using, among other indicators, the state
    fee-for-service
    Medicaid program fee schedule, Medicare fee schedules, medical
    costs trends and market conditions.
    Per Diem and Case Rates  Hospital facility costs are
    typically reimbursed at negotiated per diem or case rates, which
    vary by level of care within the hospital setting. Lower rates
    are paid for lower intensity services, such as the delivery of a
    baby without complication, compared to higher rates for a
    neonatal intensive care unit stay for a baby born with severe
    developmental disabilities.
    Percent of Charges  Providers are paid an
    agreed-upon
    percent of their standard charges for covered services.  out-of-network out-of-network out-of-network
  Capitation.
  Risk-sharing arrangements. and/or
  Incentive arrangements. and/or
  Outreach
    and Educational Programs
    ® over-the-counter
   15




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Information
    Technology Services
    Our
    Health Plans
  contract-to-contract
   16




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December 31,Market

2009


2008


2007Texas(1)


505,000



455,000



460,000Georgia


249,000



206,000



211,000Florida


236,000



237,000



206,000Tennessee(2)


195,000



187,000



356,000Maryland


194,000



169,000



152,000New Jersey


118,000



105,000



98,000New York


114,000



110,000



112,000Nevada


62,000







Ohio


60,000



58,000



54,000Virginia


35,000



25,000



24,000New Mexico


20,000



11,000



South
    Carolina(3)






16,000



District of
    Columbia(4)










38,000Total


1,788,000



1,579,000



1,711,000     (1)
    
    Membership includes approximately 13,000 members each in 2009
    and 2007 under ASO contracts. There were no ASO contracts in
    effect as of December 31, 2008.(2)
    
    Membership includes approximately 170,000 members under an ASO
    contract in 2007. This contract terminated October 31, 2008.(3)
    
    The contract with South Carolina terminated March 1, 2009
    concurrent with the sale of our rights under the contract.(4)
    
    The contract with the District of Columbia terminated
    June 30, 2008.    MedicareMarket

TANF


CHIP


ABD


FamilyCare


AdvantageTexas


ü



ü



ü







üFlorida


ü



ü



ü







üGeorgia


ü



üTennessee


ü







ü







üMaryland


ü



ü



ü



ü



üNew York


ü



ü



ü



ü



üNew Jersey


ü



ü



ü



ü



üOhio(1)


ü







üVirginia


ü



ü



üNevada


ü



ü







üNew Mexico










ü







ü     (1)
    
    Our Ohio health plan terminated its ABD contract effective
    February 1, 2010. We served approximately 6,000 members in
    Ohio under the ABD contract as of December 31, 2009. 17




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Texas
      Georgia
      Florida
     18




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Tennessee
      Maryland
      New
    Jersey
       19




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New
    York
      Nevada
    Ohio
      Virginia
    New
    Mexico
   20




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South
    Carolina
    Employees
    Available
    Information
  1-800-SEC-0330. (http://www.sec.gov). Form 10-K, Form 10-Q, Form 8-K, Form 10-K, Form 10-Q, Form 8-K,
   21




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Item 1A.
    Risk
    Factors  RISK
    FACTORS
  Risks
    related to our business
  Our
    inability to manage medical costs effectively could reduce our
    profitability.
  out-of-network
    Our
    limited ability to accurately predict our incurred but not
    reported medical expenses has in the past and could in the
    future materially impact our reported results.
    We
    derive a majority of our premium revenues and net income from a
    small number of states, in particular, the State of Texas, and
    if we fail to retain our contracts in those states, or if the
    conditions in those states change, our business and results of
    operations may suffer.
   22




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Changes
    in the number of Medicaid eligible beneficiaries, or benefits
    provided to Medicaid eligible beneficiaries or a change in mix
    of Medicaid eligible beneficiaries could cause our operating
    results to suffer.
    Receipt
    of inadequate or significantly delayed premiums could negatively
    impact our revenues, profitability and cash flows.
      As
    participants in state and Federal healthcare programs, we are
    subject to extensive fraud and abuse laws which may give rise to
    frequent lawsuits and claims against us, and the outcome of
    these lawsuits and claims may have a material adverse effect on
    our financial position, results of operations and
    liquidity.
  qui tam
 23




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Qui tam qui
    tam
  qui tam
    Failure
    to comply with the terms of our government contracts could
    negatively impact our profitability and subject us to fines,
    penalties and liquidated damages.
      Changes
    in Medicaid or Medicare funding by the states or the Federal
    government could substantially reduce our
    profitability.
   24




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Delays
    in program expansions or contract changes could negatively
    impact our business.
  start-up,
  If a
    state fails to renew its Federal waiver application for mandated
    Medicaid enrollment into managed care or such application is
    denied, our membership in that state will likely
    decrease.
    We
    rely on the accuracy of eligibility lists provided by state
    governments, and in the case of our Medicare Advantage members,
    by the Federal government. Inaccuracies in those lists could
    negatively affect our results of operations.
  time-to-time,
 25




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Our
    inability to operate new business opportunities at underwritten
    levels could have a material adverse effect on our
    business.
    Our
    inability to maintain good relations with providers could harm
    our profitability or subject us to material fines, penalties or
    sanctions.
      (out-of-network non-network out-of-network out-of-network out-of-network Out-of-network
   26




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Our
    inability to integrate, manage and grow our information systems
    effectively could disrupt our operations.
      Failure
    of a business in a new state or market could negatively impact
    our results of operations.
  Start-up start-up
  Difficulties
    in executing our acquisition strategy or integrating acquired
    business could adversely affect our business.
     27




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
    additional employees who are not familiar with our operations,
    existing provider networks, which may operate on different terms
    than our existing networks,
    existing members, who may decide to switch to another healthcare
    provider, and
    disparate information and record keeping systems.    We are
    subject to competition that impacts our ability to increase our
    penetration of the markets that we serve.
  fee-for-service
      Negative
    publicity regarding the managed care industry may harm our
    business and operating results.
    We may
    be subject to claims relating to professional liability, which
    could cause us to incur significant expenses.
  and/or
 28




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An
    unauthorized disclosure of sensitive or confidential member
    information could have an adverse effect on our business,
    reputation and profitability.
  and/or
  We are
    currently involved in litigation, and may become involved in
    future litigation, which may result in substantial expense and
    may divert our attention from our business.
  time-to-time,
  time-to-time
  Acts
    of terrorism, natural disasters and medical epidemics could
    cause our business to suffer.
   29




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Risks
    related to being a regulated entity
  Changes
    in government regulations designed to protect providers and
    members could force us to change how we operate and could harm
    our business and results of operations.
    
    force us to change how we do business,
    restrict revenue and enrollment growth,
    increase our health benefits and administrative costs,
    impose additional capital requirements, and
    increase or change our claims liability.  Regulations
    could limit our profits as a percentage of
    revenues.
        Changes
    in healthcare laws could reduce our profitability.
  time-to-time.
   30




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If
    state regulators do not approve payments of dividends,
    distributions or administrative fees by our subsidiaries to us,
    it could negatively affect our business strategy and
    liquidity.
    If
    state regulatory agencies require a statutory capital level
    higher than the state regulations we may be required to make
    additional capital contributions.
    Failure
    to comply with government laws and regulations could subject us
    to civil and criminal penalties and limitations on our
    profitability.
  and/or
  time-to-time
  and/or
   31




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and/or
        Compliance
    with the terms and conditions of our Corporate Integrity
    Agreement requires significant resources and, if we fail to
    comply, we could be subject to penalties or excluded from
    participation in government healthcare programs, which could
    seriously harm our results of operations, liquidity and
    financial results.
  qui
    tam
  and/or
 32




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Risks
    related to our financial condition
  Ineffective
    management of rapid growth or our inability to grow could
    negatively affect our results of operations, financial condition
    and business.
    Our
    debt service obligations may adversely affect our cash flows and
    our increased leverage as a result of our 2.0% Convertible
    Senior Notes may harm our financial condition and results of
    operations.
        Our
    investments in auction rate securities are subject to risks that
    may cause losses and have a material adverse effect on our
    liquidity
   33




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##### 



available-for-sale
  other-than-temporary,
  Our
    investment portfolio may suffer losses from reductions in market
    interest rates and fluctuations in fixed income securities which
    could materially adversely affect our results of operations or
    liquidity.
    Average S&P%


RatingAuction rate securities


3.9
%


AA+Cash, bank deposits and commercial paper


2.8
%


A1+Certificates of deposit


6.6
%


AAACorporate bonds


14.5
%


A+Debt obligations of government sponsored entities, Federally
    insured corporate bonds, municipal bonds and U.S. Treasury
    securities


43.9
%


AAAMoney market funds


28.3
%


AAA100.0
%


AA+     The
    value of our investments is influenced by varying economic and
    market conditions, and a decrease in value could have an adverse
    effect on our financial position, results of operations, or cash
    flows.
  available-for-sale. Available-for-sale available-for-sale
 34




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##### 



other-than-temporarily
  other-than-temporary. other-than-temporary.
  other-than-temporary available-for-sale other-than-temporary other-than-temporary
  Adverse
    credit market conditions may have a material adverse affect on
    our liquidity or our ability to obtain credit on acceptable
    terms.
      Item 1B.
    Unresolved
    Staff Comments  None.
  Item 2.
    Properties   35




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Item 3.
    Legal
    Proceedings  Risk
    Sharing Receivable
  No. 153-232258-08.
  Memorial
    Hermann Litigation
  inter alia, quantum meruit
    Purchase
    Agreement Litigation
    Other
    Litigation
   36




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Item 4.
    Submission
    of Matters to a Vote of Security Holders    Executive
    Officers of the Company
    Name

Age

PositionJames G. Carlson


57


Chairman, President and Chief Executive OfficerJames W. Truess


44


Executive Vice President and Chief Financial OfficerRichard C. Zoretic


51


Executive Vice President and Chief Operating OfficerStanley F. Baldwin


61


Executive Vice President, General Counsel and SecretaryJohn E. Littel


45


Executive Vice President, External RelationsMary T. McCluskey, M.D.


51


Executive Vice President and Chief Medical OfficerMargaret M. Roomsburg


50


Senior Vice President and Chief Accounting OfficerLeon A. Root, Jr.


56


Executive Vice President and Chief Information OfficerLinda K. Whitley-Taylor


46


Executive Vice President, Human Resources   James G. Carlson
  James W. Truess
  Richard C. Zoretic
  Stanley F. Baldwin
  John E. Littel
 37




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##### 



Mary T. McCluskey, M.D.
  Margaret M. Roomsburg
  Leon A. Root, Jr. e-commerce
  Linda K. Whitley-Taylor
 38




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##### 



PART II.  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities    High

Low2009First quarter

$
31.50


$
22.26Second quarter


32.40



25.56Third quarter


29.01



21.34Fourth quarter


27.49



20.872008First quarter

$
41.00


$
25.83Second quarter


29.51



20.77Third quarter


28.51



19.92Fourth quarter


29.68



16.02       Rule 10b5-1 Rule 10b5-1 time-to-time
 39




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Performance
    Graph
        
  Value of $100 Invested Over Past 5 Years12/31/04


12/31/05


12/31/06


12/31/07


12/31/08


12/31/09AMERIGROUP Corporation


$
100.00



$
51.44



$
94.87



$
96.35



$
78.03



$
71.27S&P 500 Index



100.00




104.91




121.48




128.16




80.74




102.11Peer Group



100.00




142.94




134.95




153.91




69.52




89.37  40




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Proceeds
    of Equity Securities by the Issuer and Affiliated
    Purchasers
    ApproximateTotal number of


Dollar Value ofAverage


Shares (or Units)


Shares (or Units)Total Number of


Price Paid


Purchased as Part of


that May Yet BeShares (or Units)


per Share


Publicly Announced


Purchased Under thePeriod

Purchased


(or Unit)


Plans or Programs


Plans or
    Programs(2)October 1  October 31, 2009


105,990


$
22.42



105,990



167,394,031November 1  November 30,
    2009(1)


95,436



22.81



94,381



165,240,247December 1  December 31, 2009


94,844



25.24



94,844



162,846,787Total


296,270


$
23.45



295,215



162,846,787     (1)
    
    Our 2009 Equity Incentive Plan allows, upon approval by the plan
    administrator, stock option recipients to deliver shares of
    unrestricted Company common stock held by the participant as
    payment of the exercise price and applicable withholding taxes
    upon the exercise of stock options or vesting of restricted
    stock. During November 2009, certain employees elected to tender
    1,055 shares to the Company in payment of related
    withholding taxes upon vesting of restricted stock.(2)
    
    On August 5, 2009, the Board authorized an increase to our
    on-going share repurchase program allowing us to repurchase up
    to $200.0 million of shares of our common stock. No duration has
    been placed on the repurchase program and we reserve the right
    to discontinue the repurchase program at any time. 41




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##### 



Item 6.
    Selected
    Financial Data  Form 10-K. Form 10-K.)
  Reclassifications
    
    The experience rebate under our contract with the State of Texas
    has been reclassified out of selling, general and administrative
    expenses and is now reflected as a reduction to premium revenue.
    Premium tax has been reclassified out of selling, general and
    administrative expenses and is now reported on a separate line
    following selling, general and administrative expenses and
    before depreciation and amortization. By isolating premium tax,
    the impacts of changing business volumes on premium tax expense
    will become more apparent.    Years Ended December 31,2009


2008


2007


2006


2005(Dollars in thousands, except per share data)Statement of Operations Data:Revenues:Premium

$
5,158,989


$
4,366,359


$
3,835,454


$
2,788,642


$
2,305,962Investment income and other


29,081



71,383



73,320



39,279



18,310Total revenues


5,188,070



4,437,742



3,908,774



2,827,921



2,324,272Expenses:Health benefits


4,407,273



3,618,261



3,216,070



2,266,017



1,957,196Selling, general and administrative


394,089



435,876



377,026



315,628



226,906Premium tax


134,277



93,757



85,218



47,100



25,903Depreciation and amortization


34,746



37,385



31,604



25,486



26,948Litigation settlement






234,205











Interest


16,266



20,514



18,962



608



608Total expenses


4,986,651



4,439,998



3,728,880



2,654,839



2,237,561Income (loss) before income taxes


201,419



(2,256
)


179,894



173,082



86,711Income tax expense


52,140



54,350



67,667



65,976



33,060Net income (loss)

$
149,279


$
(56,606
)

$
112,227


$
107,106


$
53,651Basic net income (loss) per share

$
2.89


$
(1.07
)

$
2.13


$
2.07


$
1.05Weighted average number of shares outstanding


51,647,267



52,816,674



52,595,503



51,863,999



51,213,589Diluted net income (loss) per share

$
2.85


$
(1.07
)

$
2.08


$
2.02


$
1.02Weighted average number of common shares and dilutive potential
    common shares outstanding


52,309,268



52,816,674



53,845,829



53,082,933



52,857,682  42




---



##### 



December 31,2009

2008

2007

2006

2005(Dollars in thousands)Balance Sheet Data:Cash and cash equivalents and short- and long-term investments

$
1,354,634


$
1,337,423


$
1,067,294


$
776,273


$
587,106Total assets


1,999,634



1,955,667



2,076,546



1,345,695



1,093,588Long-term debt, less current portion


235,104



268,956



317,244







Total liabilities


1,015,190



1,083,008



1,134,652



577,110



452,034Stockholders equity


984,444



872,659



941,894



768,585



641,554  43




---



##### 



Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  Overview
    Summary
    Highlights for the Year Ended December 31,
    2009
  
    Total revenues increased to $5.2 billion, or 16.9%, over
    the year ended December 31, 2008;
    Risk membership increased to 1,775,000, or 12.4%, compared to
    that as of December 31, 2008;
    HBR of 85.4% compared to 82.9% for the year ended
    December 31, 2008.
    Began providing Medicaid managed care services to TANF and CHIP
    populations in Nevada effective February 1, 2009;
    Closed the transaction to sell the contract rights of the
    Companys South Carolina health plan on March 1, 2009;
    Completed the statewide rollout to individuals of New
    Mexicos Coordination of Long-Term Services
    (CoLTS) program in April 2009. This program
    constitutes one of the Nations first comprehensive
    programs to coordinate long-term care for individuals. We are
    one of two organizations that provide coverage to New
    Mexicos approximately 38,000 CoLTS members;
    Repaid the outstanding debt and terminated our Credit and
    Guaranty Agreement (the Credit Agreement),
    decreasing our debt to total capital ratio to 19.3%; and
    Recorded a one-time tax benefit of $22.4 million, or $0.43
    per diluted share, pursuant to a pre-filing agreement with the
    Internal Revenue Service (IRS) related to the tax
    treatment of the previously recorded qui tamlitigation
    settlement relating to certain marketing practices of our former
    Illinois subsidiary.     44




---



##### 



Business
    Strategy
    Opportunities
    for Future Membership Growth
  Texas
    Tennessee
    New
    Jersey
   45




---



##### 



Other
    Market Updates
  Florida
    Ohio
    South
    Carolina
    Nevada
    New
    Mexico
   46




---



##### 



Contingencies
  Florida
    Medicaid Contract Dispute
    fee-for-service
  fee-for-service
    Georgia
    Letter of Credit
    Legal
    Proceedings
    Discussion
    of Critical Accounting Policies
   47




---



##### 



Revenue
    Recognition
          Estimating
    Health Benefits Expense and Claims Payable
     48




---



##### 



12-month adjudicated-to-date
  two-to-three
  fee-for-service,
 49




---



##### 



Completion Factor

Increase (Decrease) in(Decrease) Increase in Factor

Medical Claims
    Payable(1)(In millions)(0.75)%

$
78.0(0.50)%

$
52.0(0.25)%

$
26.00.25%

$
(26.0
)0.50%

$
(52.0
)0.75%

$
(78.0
)     (1)
    
    Reflects estimated potential changes in health benefits expense
    and medical claims payable caused by changes in completion
    factors used in developing medical claims payable estimates for
    older periods, generally periods prior to the most recent three
    months.    Medical Cost PMPM Trend

Increase (Decrease) inIncrease (Decrease) in Factor

Medical Claims
    Payable(1)(In millions)10.0%

$
14.05.0%

$
7.02.5%

$
3.5(2.5)%

$
(3.5
)(5.0)%

$
(7.0
)(10.0)%

$
(14.0
)     (1)
    
    Reflects estimated potential changes in health benefits expense
    and medical claims payable caused by changes in medical costs
    PMPM trend data used in developing medical claims payable
    estimates for the most recent three months.       50




---



##### 



2009


2008


2007Medical claims payable as of January 1

$
536,107


$
541,173


$
385,204Health benefits expense incurred during the year:Related to current year


4,492,590



3,679,107



3,284,302Related to prior years


(85,317
)


(60,846
)


(68,232
)Total incurred


4,407,273



3,618,261



3,216,070Health benefits payments during the year:Related to current year


4,007,789



3,197,732



2,769,331Related to prior years


406,555



425,595



290,770Total payments


4,414,344



3,623,327



3,060,101Medical claims payable as of December 31

$
529,036


$
536,107


$
541,173Current year medical claims paid as a percent of current year
    health benefits expense incurred


89.2
%


86.9
%


84.3
%Health benefits expense incurred related to prior years as a
    percent of prior year medical claims payable as of December 31


(15.9
)%


(11.2
)%


(17.7
)%Health benefits expense incurred related to prior years as a
    percent of the prior years health benefits expense related
    to current year


(2.3
)%


(1.9
)%


(2.9
)%         out-of-network
 51




---



##### 



Premium
    Deficiency Reserves
    Income
    Taxes
          qui tam qui tam qui tam
  Form 10-K.
  Investments
  available-for-sale available-for-sale
 52




---



##### 



Goodwill
    and Intangible Assets
    Recent
    Accounting Standards
  Form 10-K).
   53




---



##### 



Results
    of Operations
    Years Ended December 31,2009


2008


2007Premium revenue


99.4
%


98.4
%


98.1
%Investment income and other


0.6



1.6



1.9Total revenues


100.0
%


100.0
%


100.0
%Health
    benefits(1)


85.4
%


82.9
%


83.9
%Selling, general and administrative expenses


7.6
%


9.8
%


9.6
%Income (loss) before income taxes


3.9
%


(0.1)
%


4.6
%Net income (loss)


2.9
%


(1.3)
%


2.9
%     (1)
    
    The health benefits ratio is shown as a percentage of premium
    revenue because there is a direct relationship between the
    premium received and the health benefits provided.    Years Ended December 31,


Years Ended December 31,% Change








% Change2009


2008


2009-2008


2008


2007


2008-2007Revenues:Premium

$
5,159.0


$
4,366.4



18.2
%

$
4,366.4


$
3,835.5



13.8
%Investment income and other


29.1



71.4



(59.3)
%


71.4



73.3



(2.6)
%Total revenues


5,188.1



4,437.7



16.9
%


4,437.7



3,908.8



13.5
%Expenses:Health benefits


4,407.3



3,618.3



21.8
%


3,618.3



3,216.1



12.5
%Selling, general and administrative


394.1



435.9



(9.6)
%


435.9



377.0



15.6
%Premium tax


134.3



93.8



43.2
%


93.8



85.2



10.0
%Depreciation and amortization


34.7



37.4



(7.1)
%


37.4



31.6



18.3
%Litigation settlement






234.2



*



234.2







*Interest


16.3



20.5



(20.7)
%


20.5



19.0



8.2
%Total expenses


4,986.7



4,440.0



12.3
%


4,440.0



3,728.9



19.1
%Income (loss) before income taxes


201.4



(2.3
)


*



(2.3
)


179.9



*Income tax expense


52.1



54.4



(4.1)
%


54.4



67.7



(19.7)
%Net income (loss)

$
149.3


$
(56.6
)


*


$
(56.6
)

$
112.2



*Diluted net income (loss) per common share

$
2.85


$
(1.07
)


*


$
(1.07
)

$
2.08



*     *
    
    Not meaningful  Revenues
   54




---



##### 



December 31,Market

2009


2008


2007Texas(1)


505,000



455,000



460,000Georgia


249,000



206,000



211,000Florida


236,000



237,000



206,000Tennessee(2)


195,000



187,000



356,000Maryland


194,000



169,000



152,000New Jersey


118,000



105,000



98,000New York


114,000



110,000



112,000Nevada


62,000







Ohio


60,000



58,000



54,000Virginia


35,000



25,000



24,000New Mexico


20,000



11,000



South
    Carolina(3)






16,000



District of
    Columbia(4)










38,000Total


1,788,000



1,579,000



1,711,000     (1)
    
    Membership includes approximately 13,000 members each in 2009
    and 2007 under ASO contracts. There were no ASO contracts in
    effect as of December 31, 2008.(2)
    
    Membership includes approximately 170,000 members under an ASO
    contract in 2007. This contract terminated October 31, 2008.(3)
    
    The contract with South Carolina terminated March 1, 2009
    concurrent with the sale of our rights under the contract.(4)
    
    The contract with the District of Columbia terminated
    June 30, 2008.   55




---



##### 



re-negotiation re-bidding
      Health
    Benefits Expense
      Selling,
    General and Administrative Expenses
    (SG&A)
   56




---



##### 



Premium
    Tax Expense
    Depreciation
    and Amortization Expense
    Litigation
    Settlement
  qui tam
  Interest
    Expense
   57




---



##### 



Provision
    for Income Taxes
  qui tam
  qui tam
    Net
    Income (Loss)
  qui tam
  Liquidity
    and Capital Resources
      Financing
    Activities
  Credit
    Agreement
    Convertible
    Senior Notes
  Form S-3
 58




---



##### 



and/or and/or
        Universal
    Automatic Shelf Registration
    Stock
    Repurchase Program
   59




---



##### 



Cash
    and Investments
    year-over-year
        Average S&P%


RatingAuction rate securities


3.9
%


AA+Cash, bank deposits and commercial paper


2.8
%


A1+Certificates of deposit


6.6
%


AAACorporate bonds


14.5
%


A+Debt obligations of government sponsored entities, Federally
    insured corporate bonds, municipal bonds and U.S. Treasury
    securities


43.9
%


AAAMoney market funds


28.3
%


AAA100.0
%


AA+  60




---



##### 



available-for-sale, available-for-sale held-to-maturity held-to-maturity investments-on-deposit, available-for-sale held-to-maturity held-to-maturity investments-on-deposit, available-for-sale
    available-for-sale 28-35 days available-for-sale.
   61




---



##### 



debt-to-total
      Regulatory
    Capital and Dividend Restrictions
     62




---



##### 



Contractual
    Obligations
    Contractual Obligations

Total


2010


2011


2012


2013


2014


ThereafterLong-term obligations

$
273,000


$
5,200


$
5,200


$
262,600


$



$



$
Operating lease obligations


84,130



14,944



14,173



13,205



8,560



6,648



26,600Total contractual obligations

$
357,130


$
20,144


$
19,373


$
275,805


$
8,560


$
6,648


$
26,600   Operating Lease Obligations.
  Long-term Obligations.
  Off-Balance
    Sheet Arrangements
    Commitments
    Inflation
    Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk   63




---



##### 



64




---



##### 



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM           14-1 470-20-65-1)
  Internal Control 
    Integrated Framework
  
   65




---



##### 



Item 8.
    Financial
    Statements and Supplementary Data  AMERIGROUP
    CORPORATION AND SUBSIDIARIES
  CONSOLIDATED
    BALANCE SHEETS
 (Dollars
    in thousands, except per share data)
  December 31,2009


2008ASSETSCurrent assets:Cash and cash equivalents

$
505,915


$
763,272Short-term investments


137,523



97,466Premium receivables


104,867



86,595Deferred income taxes


26,361



25,347Provider and other receivables


33,083



27,468Prepaid expenses and other


14,233



14,813Total current assets


821,982



1,014,961Long-term investments


711,196



476,685Investments on deposit for licensure


102,780



94,978Property, equipment and software, net


101,002



103,747Other long-term assets


13,398



15,949Goodwill


249,276



249,347Total assets

$
1,999,634


$
1,955,667LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Claims payable

$
529,036


$
536,107Accounts payable


4,685



6,810Unearned revenue


98,298



82,588Accrued payroll and related liabilities


37,311



62,469Accrued expenses and other


89,967



108,342Current portion of long-term debt






506Total current liabilities


759,297



796,822Long-term convertible debt


235,104



225,130Long-term debt, less current portion






43,826Deferred income taxes


8,430



3,391Other long-term liabilities


12,359



13,839Total liabilities


1,015,190



1,083,008Commitments and contingencies (Note 14)Stockholders equity:Common stock, $0.01 par value. Authorized
    100,000,000 shares; issued and outstanding 50,638,474 and
    52,673,363 at December 31, 2009 and 2008, respectively


546



539Additional paid-in capital


494,735



466,926Accumulated other comprehensive income (loss)


1,354



(4,022
)Retained earnings


590,632



441,3531,087,267



904,796Less treasury stock at cost (3,956,560 and 1,207,510 shares
    at December 31, 2009 and December 31, 2008,
    respectively)


(102,823
)


(32,137
)Total stockholders equity


984,444



872,659Total liabilities and stockholders equity

$
1,999,634


$
1,955,667    66




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF OPERATIONS
  Years Ended December 31,2009


2008


2007(Dollars in thousands, except for per share data)Revenues:Premium

$
5,158,989


$
4,366,359


$
3,835,454Investment income and other


29,081



71,383



73,320Total revenues


5,188,070



4,437,742



3,908,774Expenses:Health benefits


4,407,273



3,618,261



3,216,070Selling, general and administrative


394,089



435,876



377,026Premium tax


134,277



93,757



85,218Depreciation and amortization


34,746



37,385



31,604Litigation settlement






234,205



Interest


16,266



20,514



18,962Total expenses


4,986,651



4,439,998



3,728,880Income (loss) before income taxes


201,419



(2,256
)


179,894Income tax expense


52,140



54,350



67,667Net income (loss)

$
149,279


$
(56,606
)

$
112,227Net income (loss) per share:Basic net income (loss) per share

$
2.89


$
(1.07
)

$
2.13Weighted average number of common shares outstanding


51,647,267



52,816,674



52,595,503Diluted net income (loss) per share

$
2.85


$
(1.07
)

$
2.08Weighted average number of common shares and dilutive potential
    common shares outstanding


52,309,268



52,816,674



53,845,829    67




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF STOCKHOLDERS EQUITY
  AccumulatedAdditional


Other











TotalCommon Stock


Paid-in


Comprehensive


Retained


Treasury Stock


StockholdersShares


Amount


Capital


Income (Loss)


Earnings


Shares


Amount


Equity(Dollars in thousands)Balances at January 1, 2007


52,272,824


$
523


$
391,566


$



$
376,547



1,728


$
(51
)

$
768,585Common stock issued upon exercise of stock options, vesting of
    restricted stock grants, and purchases under the employee stock
    purchase plan


881,089



9



11,653



















11,662Compensation expense related to share-based payments










11,879



















11,879Tax benefit from exercise of stock options










4,664



















4,664Common stock redeemed for payment of employee taxes


(23,985
)


















23,985



(821
)


(821
)Purchase of convertible note hedge instruments










(52,702
)


















(52,702
)Deferred tax asset related to convertible note hedge instruments










19,343



















19,343Sale of warrant instruments










25,662



















25,662Cumulative effect of adoption of guidance on accounting for
    uncertainty in income taxes


















9,185











9,185Cumulative effect of adoption of guidance on accounting for
    convertible debt instruments that may be settled in cash upon
    conversion










32,210



















32,210Net income


















112,227











112,227Balances at December 31, 2007


53,129,928



532



444,275







497,959



25,713



(872
)


941,894Common stock issued upon exercise of stock options, vesting of
    restricted stock grants, and purchases under the employee stock
    purchase plan


725,232



7



10,241



















10,248Compensation expense related to share-based payments










10,381



















10,381Tax benefit from exercise of stock options










2,034



















2,034Common stock redeemed for payment of employee taxes


(18,770
)


















18,770



(618
)


(618
)Common stock repurchases


(1,163,027
)


















1,163,027



(30,647
)


(30,647
)Deferred tax asset related to convertible note hedge instruments










(5
)


















(5
)Unrealized loss on
    available-for-sale
    securities, net of tax














(4,022
)














(4,022
)Net loss


















(56,606
)










(56,606
)Balances at December 31, 2008


52,673,363



539



466,926



(4,022
)


441,353



1,207,510



(32,137
)


872,659Common stock issued upon exercise of stock options, vesting of
    restricted stock grants, and purchases under the employee stock
    purchase plan


714,161



7



11,034



















11,041Compensation expense related to share-based payments










15,936



















15,936Tax benefit from exercise of stock options










842



















842Common stock redeemed for payment of employee taxes and stock
    option exercises


(35,483
)


















35,483



(935
)


(935
)Common stock repurchases


(2,713,567
)


















2,713,567



(69,751
)


(69,751
)Deferred tax asset related to convertible note hedge instruments










(3
)


















(3
)Unrealized gain on
    held-to-maturity
    investment portfolio at time of transfer to
    available-for-sale,
    net of tax














3,030















3,030Unrealized gain on
    available-for-sale
    securities, net of tax














2,346















2,346Net income


















149,279











149,279Balances at December 31, 2009


50,638,474


$
546


$
494,735


$
1,354


$
590,632



3,956,560


$
(102,823
)

$
984,444    68




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES



CONSOLIDATED
    STATEMENTS OF CASH FLOWS   Years Ended December 31,2009


2008


2007(Dollars in thousands)Cash flows from operating activities:Net income (loss)

$
149,279


$
(56,606
)

$
112,227Adjustments to reconcile net income (loss) to net cash provided
    by operating activities:Depreciation and amortization


34,746



37,385



31,604Loss on disposal or abandonment of property, equipment and
    software


585



644



67Deferred tax expense (benefit)


818



(288
)


(4,652
)Compensation expense related to share-based payments


15,936



10,381



11,879Convertible debt non-cash interest


9,974



9,344



6,671Impairment of goodwill






8,808



Gain on sale of contract rights


(5,810
)






Other


(167
)


(441
)


Changes in assets and liabilities (decreasing) increasing cash
    flows from operations:Premium receivables


(18,272
)


(3,655
)


(19,346
)Prepaid expenses, provider and other receivables and other
    current assets


(2,310
)


41,183



(18,499
)Other assets


(1,146
)


788



(2,577
)Claims payable


(7,071
)


(5,066
)


155,969Accounts payable, accrued expenses, and other current liabilities


(43,758
)


5,557



39,464Unearned revenue


15,710



26,651



29,821Other long-term liabilities


(1,480
)


(409
)


8,112Net cash provided by operating activities


147,034



74,276



350,740Cash flows from investing activities:Proceeds from sale of trading securities


5,850







Purchase of trading securities






(17,850
)


Proceeds from sale of
    available-for-sale
    securities


299,239



121,039



683,740Purchase of
    available-for-sale
    securities


(648,670
)


(78,864
)


(667,225
)Proceeds from redemption of
    held-to-maturity
    securities


273,125



617,025



524,458Purchase of
    held-to-maturity
    securities


(194,851
)


(644,431
)


(521,098
)Purchase of property, equipment and software


(29,738
)


(37,034
)


(40,334
)Proceeds from redemption of investments on deposit for licensure


72,164



68,404



63,339Purchase of investments on deposit for licensure


(79,574
)


(73,897
)


(84,313
)Proceeds from sale of contract rights


5,810







Purchase price adjustment received






1,500



Purchase of restricted investments held as collateral










(402,812
)Release of restricted investments held as collateral






351,318



51,494Purchase of convertible note hedge instruments










(52,702
)Proceeds from sale of warrant instruments










25,662Purchase of contract rights and related assets










(11,733
)Net cash (used in) provided by investing activities


(296,645
)


307,210



(431,524
)Cash flows from financing activities:Proceeds from issuance of convertible notes










260,000Borrowings under credit facility










351,318Repayment of borrowings under credit facility


(44,318
)


(84,028
)


(222,293
)Payment of debt issuance costs










(11,732
)Net (decrease) increase in bank overdrafts


(2,492
)


2,192



(1,097
)Payment of capital lease obligations






(368
)


(842
)Customer funds administered


(2,725
)


(5,259
)


Proceeds from exercise of stock options and employee stock
    purchases


10,698



10,248



11,662Repurchase of common stock shares


(69,751
)


(30,647
)


Tax benefit related to exercise of stock options


842



2,034



4,664Net cash (used in) provided by financing activities


(107,746
)


(105,828
)


391,680Net (decrease) increase in cash and cash equivalents


(257,357
)


275,658



310,896Cash and cash equivalents at beginning of year


763,272



487,614



176,718Cash and cash equivalents at end of year

$
505,915


$
763,272


$
487,614    69




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS (Continued)
  Years Ended December 31,2009


2008


2007(Dollars in thousands)Supplemental disclosures of cash flow information:Cash paid for interest

$
6,302


$
12,832


$
10,073Cash paid for income taxes

$
51,745


$
27,977


$
77,931Supplemental disclosures non-cash information:Common stock redeemed for payment of employee taxes and stock
    option exercises

$
(935
)

$
(618
)

$
(821
)Transfer of
    held-to-maturity
    securities to
    available-for-sale
    securities

$
424,237


$



$
Transfer of
    held-to-maturity
    investments on deposit to
    available-for-sale
    investments on deposit

$
98,458


$



$
Unrealized gain on
    held-to-maturity
    portfolio at time of transfer to
    available-for-sale,
    net of tax

$
3,030


$



$
Unrealized gain (loss) on
    available-for-sale
    securities, net of tax

$
2,346


$
(4,022
)

$
Cumulative effect of adoption of guidance on accounting for
    uncertainty in income taxes

$



$



$
9,185Cumulative effect of adoption of guidance on accounting for
    convertible debt instruments that may be settled in cash upon
    conversion

$



$



$
32,210Deferred tax asset related to convertible note hedge instruments

$
(3
)

$
(5
)

$
19,343    70




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES



NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2009, 2008 and 2007

(Dollars in thousands, except for per share data) (1)
    Corporate
    Organization and Principles of Consolidation  (a)
    Corporate
    Organization      (b)
    Principles
    of Consolidation    (c)
    Use of
    Estimates    (d)
    Reclassifications    
    The experience rebate related to a contract with the State of
    Texas has been reclassified out of selling, general and
    administrative expenses and is now reflected as a reduction to
    premium revenue. The experience rebate amounts reflected as a
    reduction to premium revenue were $51,727, $78,264, and $36,756,
    respectively, for the years ended December 31, 2009, 2008
    and 2007.
    Premium tax has been reclassified out of selling, general and
    administrative expenses and is now reported on a separate line
    following selling, general and administrative expenses and
    before depreciation and amortization. By isolating premium tax,
    the impacts of changing business volumes on premium tax expense
    will become more apparent.   71




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (2)
    Summary
    of Significant Accounting Policies and Practices  (a)
    Cash
    Equivalents    (b)
    Short
    and Long-Term Investments and Investments on Deposit for
    Licensure  available-for-sale. available-for-sale. Available-for-sale other-than-temporary-impairment
  available-for-sale, available-for-sale Short and
    Long-Term Investments and Investments on Deposit for
    Licensure
  (c)
    Fair
    Value Measurements    Cash and cash equivalents, premium receivables, provider and
    other receivables, prepaid expenses, other current assets,
    claims payable, accounts payable, unearned revenue, accrued
    payroll and related liabilities, and accrued expenses and other
    current liabilities
  Short-term investments, long-term investments, investments on
    deposit for licensure, cash surrender value of life insurance
    policies (included in other long-term assets) and forward
    contracts related to certain auction rate securities (included
    in other long-term assets)
  Convertible Senior Notes:
  Fair Value Measurements
 72




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (d)
    Property
    and Equipment    Leasehold improvements


3-15 yearsFurniture and fixtures


7 yearsEquipment


3-5 years   (e)
    Software    (f)
    Goodwill
    and Other Intangibles    (g)
    Other
    Assets    (h)
    Income
    Taxes  book-to-tax
       73




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    qui tam qui tam
  (i)
    Premium
    Tax    (j)
    Stock-Based
    Compensation    (k)
    Premium
    Revenue  and/or
   74




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    (l)
    Experience
    Rebate Payable    (m)
    Claims
    Payable      2009


2008


2007Medical claims payable as of January 1

$
536,107


$
541,173


$
385,204Health benefits expense incurred during the year:Related to current year


4,492,590



3,679,107



3,284,302Related to prior years


(85,317
)


(60,846
)


(68,232
)Total incurred


4,407,273



3,618,261



3,216,070Health benefits payments during the year:Related to current year


4,007,789



3,197,732



2,769,331Related to prior years


406,555



425,595



290,770Total payments


4,414,344



3,623,327



3,060,101Medical claims payable as of December 31

$
529,036


$
536,107


$
541,173Current year medical claims paid as a percent of current year
    health benefits expense incurred


89.2
%


86.9
%


84.3
%Health benefits expense incurred related to prior years as a
    percent of prior year medical claims payable as of December 31


(15.9
)%


(11.2
)%


(17.7
)%Health benefits expense incurred related to prior years as a
    percent of the prior years health benefits expense related
    to current year


(2.3
)%


(1.9
)%


(2.9
)%    75




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      (n)
    Stop-loss
    Coverage    (o)
    Impairment
    of Long-Lived Assets      (p)
    Net
    Income (Loss) Per Share   76




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    (q)
    Recent
    Accounting Standards  Codification
  The tm and the Hierarchy of Generally Accepted Accounting
    Principles  a replacement of FASB Statement
    No. 162 FASB Accounting Standards
    Codificationtm
  Fair
    Value
    other-than-temporary-impairments
    Convertible
    Debt Instruments
   77




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Years Ended December 31,2009


2008


2007Interest expense:Non-cash interest

$
9,974


$
9,344


$
6,671Cash interest


5,200



5,200



3,900Total interest expense

$
15,174


$
14,544


$
10,571  78




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Years Ended December 31,2008

2007Effect of





Effect ofAs Reported

As Adjusted

Change

As Reported

As Adjusted

ChangeConsolidated Statements of Operations:Interest expense

$
11,170


$
20,514


$
9,344


$
12,291


$
18,962


$
6,671Income (loss) before income taxes


7,088



(2,256
)


(9,344
)


186,565



179,894



(6,671
)Income tax expense


57,750



54,350



(3,400
)


70,115



67,667



(2,448
)Net (loss) income


(50,662
)


(56,606
)


(5,944
)


116,450



112,227



(4,223
)Basic net (loss) income per share


(0.96
)


(1.07
)


(0.11
)


2.21



2.13



(0.08
)Diluted net (loss) income per share


(0.96
)


(1.07
)


(0.11
)


2.16



2.08



(0.08
)   December 31, 2008Effect ofAs Reported

As Adjusted

ChangeConsolidated Balance Sheet:Deferred income tax assets

$
34,645


$
25,347


$
(9,298
)Long-term convertible debt


260,000



225,130



(34,870
)Deferred income tax liabilities






3,391



3,391Additional paid-in capital


434,578



466,926



32,348Retained earnings


451,520



441,353



(10,167
)     December 31,2009

2008Carrying amount of the equity component

$
50,885


$
50,885Principal amount of the liability component

$
260,000


$
260,000Unamortized discount of the liability component

$
24,896


$
34,870Net carrying amount of the liability component

$
235,104


$
225,130Remaining amortization period of discount


29 months



41 monthsConversion price per share


42.53



42.53Number of shares to be issued upon conversion


6,112,964



6,112,964Effective interest rate on liability component


6.74
%


6.74
%   Other
   79




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    (r)
    Risks
    and Uncertainties    one-to-two-years
  (s)
    Change
    in Estimate    (t)
    Subsequent
    Events  and/or Form 10-K
 80




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (3)
    Fair
    Value Measurements    Assets
    Fair Value Measurements at Reporting Date UsingQuoted Prices in





SignificantActive Markets for


Significant Other


UnobservableIdentical Assets


Observable Inputs


Inputs2009


(Level 1)


(Level 2)


(Level 3)Cash equivalents

$
481,171


$
481,171


$



$
Trading securities


10,835











10,835Auction rate securities
    (available-for-sale)


46,003











46,003Available-for-sale
    securities


894,661



473,670



420,991



Forward contract related to auction rate securities


1,165











1,165Total assets measured at fair value

$
1,433,835


$
954,841


$
420,991


$
58,003   Fair Value Measurements at Reporting Date UsingQuoted Prices in





SignificantActive Markets for


Significant Other


UnobservableIdentical Assets


Observable Inputs


Inputs2008


(Level 1)


(Level 2)


(Level 3)Cash and cash equivalents

$
763,272


$
763,272


$



$
Auction rate securities


71,640











71,640Forward contract related to auction rate securities


2,014











2,014Total assets measured at fair value

$
836,926


$
763,272


$



$
73,654  81




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2009


2008Auction


AuctionRate


RateSecurities


SecuritiesBalance at beginning of period

$
73,654


$
Transfers to Level 3






92,550Total net unrealized gains (losses) included in other
    comprehensive income


2,225



(6,372
)Total net realized gains (losses) included in earnings


224



(224
)Settlements


(18,100
)


(12,300
)Balance at end of period

$
58,003


$
73,654     available-for-sale available-for-sale.
  available-for-sale
 82




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Liabilities
    (4)
    Short and
    Long-Term Investments and Investments on Deposit for
    Licensure  available-for-sale, available-for-sale held-to-maturity held-to-maturity held-to-maturity held-to-maturity
  available-for-sale held-to-maturity
  Gross


GrossUnrealized


UnrealizedAmortized


Holding


Holding


FairCost


Gains


Losses


Value2009:Available-for-sale
    securities (carried at fair value):Certificates of deposit

$
25,000


$
5


$



$
25,005Commercial paper


8,989



3







8,992Corporate bonds


5,605



4



1



5,608Debt securities of government sponsored entities


80,246



37



10



80,273Municipal bonds


17,643



5



3



17,645Total short-term investments

$
137,483


$
54


$
14


$
137,523   Gross


GrossUnrealized


UnrealizedAmortized


Holding


Holding


FairCost


Gains


Losses


Value2008:Held-to-maturity
    securities (carried at amortized cost):Corporate bonds

$
13,985


$
2


$
99


$
13,888Debt securities of government sponsored entities


83,481



644







84,125Total short-term investments

$
97,466


$
646


$
99


$
98,013  83




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  available-for-sale held-to-maturity
  Gross


GrossUnrealized


UnrealizedAmortized


Holding


Holding


FairCost


Gains


Losses


Value2009:Available-for-sale
    securities (carried at fair value):Auction rate securities, maturing between one year and five years

$
4,000


$



$
231


$
3,769Auction rate securities, maturing in greater than ten years


46,150







3,916



42,234Corporate bonds, maturing within one year


40,117



623







40,740Corporate bonds, maturing between one year and five years


162,017



1,898



99



163,816Debt securities of government sponsored entities, maturing
    within one year


87,000



831



11



87,820Debt securities of government sponsored entities, maturing
    between one year and five years


163,326



1,141



28



164,439Federally insured corporate bonds, maturing within one year


22,040



316







22,356Federally insured corporate bonds, maturing between one year and
    five years


24,200



459



7



24,652Municipal bonds, maturing within one year


4,969



13







4,982Municipal bonds, maturing between one year and five years


15,271



138



6



15,403Municipal bonds, maturing between five years and ten years


32,632



300



57



32,875Municipal bonds, maturing in greater than ten years


94,366



415



5



94,776U.S. Treasury securities, maturing between one years and five
    years


2,499











2,499Total long-term investments

$
698,587


$
6,134


$
4,360


$
700,361   84




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Gross


GrossUnrealized


UnrealizedAmortized


Holding


Holding


FairCost


Gains


Losses


Value2008:Available-for-sale
    securities (carried at fair value):Auction rate securities, maturing between one year and five years

$
4,000


$



$
390


$
3,610Auction rate securities, maturing in greater than ten years


58,400







5,982



52,418Total
    available-for-sale
    long-term investments

$
62,400


$



$
6,372


$
56,028Held-to-maturity
    securities (carried at amortized cost):Corporate bonds, maturing within one year

$
20,962


$



$
1,115


$
19,847Corporate bonds, maturing between one year and five years


26,602



8



326



26,284Debt securities of government sponsored entities, maturing
    within one year


17,212



255







17,467Debt securities of government sponsored entities, maturing
    between one year and five years


301,010



4,775



29



305,756Federally insured corporate bonds, maturing between one year and
    five years


39,259



731







39,990Total
    held-to-maturity
    long-term investments

$
405,045


$
5,769


$
1,470


$
409,344     Purchase


Realized


Realized


FairAmount


Gains


Losses


Value2009:Trading securities (carried at fair value):Auction rate securities, maturing in greater than ten years

$
12,000


$



$
1,165


$
10,835   Purchase


Realized


Realized


FairAmount


Gains


Losses


Value2008:Trading securities (carried at fair value):Auction rate securities, maturing in greater than ten years

$
17,850


$



$
2,238


$
15,612    85




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  available-for-sale held-to-maturity
  Gross


GrossUnrealized


UnrealizedAmortized


Holding


Holding


FairCost


Gains


Losses


Value2009:Cash

$
414


$



$



$
414Certificates of deposit, maturing within one year


11,150











11,150Money market funds


21,978











21,978Available-for-sale
    securities (carried at fair value):Debt securities of government sponsored entities, maturing
    within one year


935







1



934Debt securities of government sponsored entities, maturing
    between one year and five years


49,262



285



38



49,509U.S. Treasury securities, maturing within one year


16,189



8



13



16,184U.S. Treasury securities, maturing between one year and five
    years


2,460



151







2,611Total

$
102,388


$
444


$
52


$
102,780   Gross


GrossUnrealized


UnrealizedAmortized


Holding


Holding


FairCost


Gains


Losses


Value2008:Cash

$
479


$



$



$
479Money market funds


39,924











39,924Held-to-maturity
    securities (carried at amortized cost):Debt securities of government sponsored entities, maturing
    within one year


937



13







950Debt securities of government sponsored entities, maturing
    between one year and five years


34,901



341







35,242Debt securities of government sponsored entities, maturing
    between five years and ten years


102



6







108U.S. Treasury securities, maturing within one year


15,368



173







15,541U.S. Treasury securities, maturing between one year and five
    years


2,678



110







2,788U.S. Treasury securities, maturing between five years and ten
    years


589



11







600Total

$
94,978


$
654


$



$
95,632  86




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  available-for-sale held-to-maturity other-than-temporarily
  Less than 12 Months


12 Months or GreaterGross








GrossUnrealized


Total





Unrealized


TotalFair


Holding


Number of


Fair


Holding


Number ofValue


Losses


Securities


Value


Losses


Securities2009:Available-for-sale
    securities (carried at fair value):Auction rate securities

$



$







$
46,003


$
4,147



13Corporate bonds


40,971



100



32











Debt securities of government sponsored entities


44,881



88



13











Federally insured corporate bond


4,076



7



1











Municipal bonds


17,771



71



7











U.S. Treasury securities


9,420



13



2











Total temporarily impaired securities

$
117,119


$
279



55


$
46,003


$
4,147



13   Less than 12 Months


12 Months or GreaterGross








GrossUnrealized


Total





Unrealized


TotalFair


Holding


Number of


Fair


Holding


Number ofValue


Losses


Securities


Value


Losses


Securities2008:Available-for-sale
    securities (carried at fair value):Auction rate securities

$
56,028


$
6,372



17


$



$




Held-to-maturity
    securities (carried at amortized cost):Corporate bonds


54,579



1,540



22











Debt securities of government sponsored entities


4,980



29



3







Total temporarily impaired securities

$
115,587


$
7,941



42


$



$




    87




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (5)
    Property,
    Equipment and Software, Net    2009


2008Leasehold improvements

$
33,799


$
33,134Furniture and fixtures


21,169



21,791Equipment


67,691



71,890Software


135,036



117,908257,695



244,723Less accumulated depreciation and amortization


(156,693
)


(140,976
)$
101,002


$
103,747   (6)
    Market
    Updates  (a)
    New
    Jersey    (b)
    South
    Carolina    (c)
    West
    Tennessee   88




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    (d)
    District
    of Columbia    (7)
    Summary
    of Goodwill and Acquired Intangible Assets    Changes in theCarryingAmount ofGoodwillBalance as of January 1, 2008:Goodwill

$
259,655Accumulated impairment losses


259,655Goodwill written off related to termination of West Tennessee
    ASO contract


(6,544
)Purchase price adjustment related to West Tennessee ASO contract


(1,500
)Goodwill written off related to District of Columbia market exit


(2,264
)Balance as of December 31, 2008


249,347Goodwill written off related to Midsouth Health Solutions,
    Inc.


(71
)Balance as of December 31, 2009

$
249,276     2009


2008Gross Carrying


Accumulated


Gross Carrying


AccumulatedAmount


Amortization


Amount


AmortizationMembership rights and provider contracts

$
25,971


$
(25,517
)

$
25,971


$
(25,113
)Non-compete agreements and trademarks


1,596



(1,596
)


1,596



(1,596
)$
27,567


$
(27,113
)

$
27,567


$
(26,709
)  89




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Estimatedamortizationexpense2010

$
1992011


1062012


652013


472014


37   (8)
    Income
    Taxes    Years Ended December 31,2009


2008


2007Income taxes from continuing operations

$
52,140


$
54,350


$
67,667Stockholders equity, tax benefit on exercise of stock
    options


(842
)


(2,034
)


(4,664
)Stockholders equity, tax expense related to unrealized
    gain on
    held-to-maturity
    investment portfolio at time of transfer to
    available-for-sale


1,835







Stockholders equity, tax expense (benefit) related to
    unrealized gain (loss) on
    available-for-sale
    securities


1,369



(2,350
)


$
54,502


$
49,966


$
63,003     Current


Deferred


TotalYear ended December 31, 2009:U.S. Federal

$
48,532


$
86


$
48,618State and local


2,790



732



3,522$
51,322


$
818


$
52,140Year ended December 31, 2008:U.S. Federal

$
46,445


$
(555
)

$
45,890State and local


8,193



267



8,460$
54,638


$
(288
)

$
54,350Year ended December 31, 2007:U.S. Federal

$
64,771


$
(5,011
)

$
59,760State and local


7,548



359



7,907$
72,319


$
(4,652
)

$
67,667  90




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Years Ended December 31,2009


2008


2007Amount


%


Amount


%


Amount


%Tax expense (benefit) at statutory rate

$
70,496



35.0


$
(789
)


35.0


$
62,963



35.0Increase in income taxes resulting from:State and local income taxes, net of Federal income tax effect


2,549



1.3



5,620



(249.1
)


5,241



2.9Qui tamsettlement payment, net non-deductible amount










48,724



(2,160.0
)






Effect of nondeductible expenses and other, net


1,544



0.7



795



(35.3
)


(537
)


(0.3
)Decrease in income taxes resulting from:IRS pre-filing agreement on qui tamsettlement


(22,449
)


(11.1
)














Total income tax expense

$
52,140



25.9


$
54,350



(2,409.4
)

$
67,667



37.6    91




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    December 31,2009


2008Deferred tax assets:Estimated claims incurred but not reported, a portion of which
    is deductible as paid for tax purposes

$
4,867


$
7,209Vacation, bonus, stock compensation and other accruals,
    deductible as paid for tax purposes


25,093



22,567Accounts receivable allowances, deductible as written off for
    tax purposes


6,896



4,814Start-up
    costs, deductible in future periods for tax purposes


413



77Unearned revenue, a portion of which is includible in income as
    received for tax purposes


7,343



6,247Convertible bonds


603



619Unrealized losses on
    available-for-sale
    securities






2,350Long term debt issuance costs, due to timing differences in book
    and tax amortization






736State net operating loss/credit carryforwards, deductible in
    future periods for tax purposes


322



872Gross deferred tax asset


45,537



45,491Deferred tax liabilities:Goodwill, due to tax amortization


(4,774
)


(3,590
)Unrealized gains on investments


(854
)


Property and equipment, due to timing differences in book and
    tax depreciation


(19,902
)


(17,864
)Deductible prepaid expenses and other


(2,076
)


(2,081
)Gross deferred tax liabilities


(27,606
)


(23,535
)Net deferred tax asset

$
17,931


$
21,956        92




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    AmountBalance at January 1, 2009

$
952Additions based on tax positions for current year


Additions for tax positions of prior years


56Reductions for tax positions of prior years


(126
)Settlements


Balance at December 31, 2009

$
882     (9)
    Long-Term
    Debt    2009


20082% Convertible Senior Notes due May 15, 2012, net of
    discount

$
235,104


$
225,130Credit and Guaranty Agreement






44,332$
235,104


$
269,462   Convertible
    Senior Notes
  Form S-3
   93




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    and/or and/or
        Credit
    and Guaranty Agreement
    Maturities
    of Long-term Obligations
    Principal


Interest


Total2010

$



$
5,200


$
5,2002011






5,200



5,2002012


260,000



2,600



262,600Thereafter










Total debt

$
260,000


$
13,000


$
273,000   (10)
    Stock
    Option Plan   94




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Weighted-AverageAggregate


RemainingWeighted-Average


Intrinsic


Contractual TermShares


Exercise Price


Value


(Years)Outstanding at December 31, 2008


5,414,388


$
27.17Granted


755,961



30.89Exercised


(514,352
)


17.07Expired


(294,655
)


39.66Forfeited


(55,330
)


30.72Outstanding at December 31, 2009


5,306,012


$
27.95


$
16,236



4.49Exercisable as of December 31, 2009


3,549,385


$
27.60


$
14,283



3.86     Years Ended December 31,2009

2008

2007Expected volatility

47.28% - 48.94%

43.25% - 46.65%

43.50% - 44.31%Weighted-average stock price volatility

48.89%

44.95%

43.99%Expected option life

2.42 - 5.56 years

1.14 - 7.00 years

2.00 - 7.00 yearsRisk-free interest rate

0.60% - 2.73%

1.67% - 3.36%

3.42% - 4.82%Dividend yield

None

None

None     i.
    the expected life of each award granted was calculated using the
    simplified method, which uses the vesting period,
    generally quarterly over four years, and the option term,
    generally seven years, to calculate the expected life of the
    option;ii.
    expected volatility is based on historical volatility levels,
    which we believe is indicative of future levels; andiii.
    the risk-free interest rate is based on the implied yield
    currently available on U.S. Treasury zero coupon issues
    with a remaining term equal to the expected life.     95




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Years Ended December 31,2009

2008

2007Cash received upon exercise of options

$
10,698


$
10,248


$
11,662Related tax benefit realized


842



2,034



4,664       Weighted-AverageGrant Date FairShares


ValueNon-vested balance at December 31, 2008


350,349


$
28.26Granted


328,852



31.15Vested


(102,477
)


28.57Forfeited


(43,706
)


29.43Non-vested balance at December 31, 2009


533,018



29.89   and/or
    (11)
    Employee
    Stock Purchase Plan   96




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Six Month Offering Periods EndingDecember 31,


June 30,


December 31,


June 30,


December 31,


June 30,2009


2009


2008


2008


2007


2007Expected volatility


48.83
%


47.32
%


44.27
%


43.28
%


43.62
%


44.52
%Expected term


6 months



6 months



6 months



6 months



6 months



6 monthsRisk-free interest rate


0.35
%


0.27
%


2.17
%


3.49
%


4.95
%


5.07
%Divided yield


None



None



None



None



None



None     Six Month Offering Periods EndingDecember 31,

June 30,

December 31,

June 30,

December 31,

June 30,2009

2009

2008

2008

2007

2007Grant-date fair value

$
7.71


$
8.36


$
5.74


$
10.00


$
6.58


$
10.01   (12)
    Share
    Repurchase Program  on-going
 97




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (13)
    Earnings
    Per Share    Years Ended December 31,2009


2008


2007Basic net income (loss) per share:Net income (loss)

$
149,279


$
(56,606
)

$
112,227Weighted-average number of common shares outstanding


51,647,267



52,816,674



52,595,503Basic net income (loss) per share

$
2.89


$
(1.07
)

$
2.13Diluted net income (loss) per share:Net income (loss)

$
149,279


$
(56,606
)

$
112,227Weighted-average number of common shares outstanding


51,647,267



52,816,674



52,595,503Dilutive effect of stock options and non-vested stock awards (as
    determined by applying the treasury stock method)


662,001







1,250,326Weighted-average number of common shares and dilutive potential
    common shares outstanding


52,309,268



52,816,674



53,845,829Diluted net income (loss) per share

$
2.85


$
(1.07
)

$
2.08         (14)
    Commitments
    and Contingencies  (a)
    Minimum
    Reserve Requirements    (b)
    Professional
    Liability   98




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (c)
    Lease
    Agreements    OperatingLeases2010

$
14,9442011


14,1732012


13,2052013


8,5602014


6,648Thereafter


26,600Total minimum lease payments

$
84,130     (d)
    Deferred
    Compensation Plans       99




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (e)
    Florida
    Medicaid Contract Dispute    fee-for-service
  fee-for-service
    (f)
    Letter
    of Credit    (g)
    Legal
    Proceedings  Risk
    Sharing Receivable
  No. 153-232258-08.
 100




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Memorial
    Hermann Litigation
  inter alia, quantum meruit
    Litigation
    Settlement
  qui tam
  Other
    Litigation
    (15)
    Parent
    Financial Statements   101




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    BALANCE SHEETS
  December 31,2009


2008(Dollars in thousands)ASSETSCurrent assets:Cash and cash equivalents

$
58,326


$
256,126Short-term investments


52,765



Due from affiliates


26,076



Deferred income taxes


7,975



9,396Prepaid expenses and other


12,928



10,531Total current assets


158,070



276,053Long-term investments


120,886



53,706Investment in subsidiaries


934,838



844,031Property, equipment and software, net


84,035



84,312Deferred income taxes


11,278



Other long-term assets


12,525



14,673Total assets

$
1,321,632


$
1,272,775LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable

$
7,144


$
6,810Accrued payroll and related liabilities


37,311



62,469Accrued expenses and other


38,891



41,690Due to subsidiaries






3,064Current portion of long-term debt






506Total current liabilities


83,346



114,539Long-term convertible debt


235,104



225,130Long-term debt less current portion






43,826Deferred income taxes


6,379



2,782Other long-term liabilities


12,359



13,839Total liabilities


337,188



400,116Stockholders equity:Common stock, $0.01 par value. Authorized
    100,000,000 shares; issued and outstanding 50,638,474 and
    52,673,363 at December 31, 2009 and 2008, respectively


546



539Additional
    paid-in-capital


494,735



466,926Accumulated other comprehensive income (loss)


1,354



(3,207
)Retained earnings


590,632



440,5381,087,267



904,796Less treasury stock at cost (3,956,560 and
    1,207,510 shares at December 31, 2009 and
    December 31, 2008, respectively)


(102,823
)


(32,137
)Total stockholders equity


984,444



872,659Total liabilities and stockholders equity

$
1,321,632


$
1,272,775  102




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    STATEMENTS OF OPERATIONS
  Years Ended December 31,2009


2008


2007(Dollars in thousands, except per share data)Revenues:Service fees from subsidiaries

$
368,379


$
291,350


$
279,686Investment income and other


2,476



15,309



27,596Total revenues


370,855



306,659



307,282Expenses:Selling, general and administrative


262,684



228,155



218,785Depreciation and amortization


27,256



27,626



24,292Litigation settlement






234,205



Interest


16,225



19,382



18,953Total expenses


306,165



509,368



262,030Income (loss) before income taxes and equity earnings in
    subsidiaries


64,690



(202,709
)


45,252Income tax (expense) benefit


(465
)


20,855



(17,128
)Equity earnings in subsidiaries


85,054



125,248



84,103Net income (loss)

$
149,279


$
(56,606
)

$
112,227Net income (loss) per share:Basic net income (loss) per share

$
2.89


$
(1.07
)

$
2.13Weighted average number of shares outstanding


51,647,267



52,816,674



52,595,503Diluted net income (loss) per share

$
2.85


$
(1.07
)

$
2.08Weighted average number of common shares and dilutive potential
    common shares outstanding


52,309,268



52,816,674



53,845,829  103




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    STATEMENTS OF CASHFLOWS
  Years Ended December 31,2009


2008


2007(Dollars in thousands)Cash flows from operating activities:Net income (loss)

$
149,279


$
(56,606
)

$
112,227Adjustments to reconcile net income (loss) to net cash provided
    by (used in) operating activities:Depreciation and amortization


27,256



27,626



24,292Loss on disposal or abandonment of property, equipment and
    software


121



402



84Long-term convertible debt interest


9,974



9,344



6,671Deferred tax (benefit) expense


(9,467
)


195



(3,076
)Compensation expense related to share-based payments


15,936



10,381



11,879Gain on sale of contract rights


(5,810
)






Other


(2,763
)


(384
)


Changes in assets and liabilities (decreasing) increasing cash
    flows from operations:Equity earnings in subsidiaries


(85,054
)


(125,248
)


(84,103
)Unearned revenue










(5,561
)Prepaid expenses and other current assets


(2,397
)


23,064



(3,095
)Other assets


(1,146
)


795



(2,359
)Accounts payable and other current liabilities


(28,215
)


17,498



13,450Other long-term liabilities


(1,480
)


(409
)


8,112Net cash provided by (used in) operating activities


66,234



(93,342
)


78,521Cash flows from investing activities:(Purchases of) proceeds from sale of securities, net


(115,115
)


71,980



147Purchase of property and equipment and software


(24,656
)


(29,321
)


(27,918
)Contributions made to subsidiaries


(70,104
)


(87,390
)


(102,847
)Dividends received from subsidiaries


71,700



70,151



70,519Proceeds from sale of contract rights


5,810







Release (purchase) of restricted investments held as collateral,
    net






351,318



(351,318
)Purchase of convertible note hedge instruments










(52,702
)Proceeds from sale of warrant instruments










25,662Net cash (used in) provided by investing activities


(132,365
)


376,738



(438,457
)Cash flows from financing activities:Change in due to and due from subsidiaries, net


(29,140
)


1,989



20,165Proceeds from issuance of convertible notes










260,000Borrowings under credit facility










351,318Repayment of borrowings under credit facility


(44,318
)


(84,028
)


(222,293
)Payment of debt issuance costs










(11,732
)Payment of capital lease obligations






(368
)


(842
)Proceeds from exercise of stock optionsand employee stock purchases


10,698



10,248



11,662Repurchase of common stock shares


(69,751
)


(30,647
)


Tax benefit related to exercise of stock options


842



2,034



4,664Net cash (used in) provided by financing activities


(131,669
)


(100,772
)


412,942Net (decrease) increase in cash and cash equivalents


(197,800
)


182,624



53,006Cash and cash equivalents at beginning of year


256,126



73,502



20,496Cash and cash equivalents at end of year

$
58,326


$
256,126


$
73,502  104




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (16)
    Quarterly
    Financial Data (unaudited)  Three Months Ended2009

March 31


June 30


September 30


December 31Premium revenues

$
1,217,447


$
1,284,890


$
1,298,969


$
1,357,683Health benefits expense


1,019,303



1,103,213



1,136,391



1,148,366Selling, general and administrative expenses


110,375



96,285



82,238



105,191Income before income taxes


59,434



43,374



34,949



63,662Net income


36,909



49,599



22,549



40,222Diluted net income per share


0.69



0.94



0.43



0.79Weighted-average number of common shares and dilutive potential
    shares outstanding


53,424,802



53,029,943



51,920,745



51,069,265   Three months ended2008

March 31


June 30


September 30


December 31Premium revenues

$
1,050,004


$
1,098,356


$
1,080,367


$
1,137,632Health benefits expense


874,921



911,471



885,774



946,095Selling, general and administrative expenses


106,742



113,140



112,222



103,772Income (loss) before income taxes


54,357



(178,222
)


62,196



59,413Net income (loss)


33,637



(164,032
)


37,926



35,863Diluted net income (loss) per share


0.62



(3.10
)


0.71



0.67Weighted-average number of common shares and dilutive potential
    shares outstanding


54,403,315



52,953,851



53,494,690



53,345,226   (17)
    Comprehensive
    Earnings    Years Ended December 31,2009


2008


2007Net income (loss)

$
149,279


$
(56,606
)

$
112,227Other comprehensive income (loss):Unrealized gain on
    held-to-maturity
    investment portfolio at time of transfer to
    available-for-sale,
    net of tax


3,030







Unrealized gain (loss) on
    available-for-sale
    securities, net of tax


2,346



(4,022
)


Other comprehensive income (loss)


5,376



(4,022
)


Comprehensive income (loss)

$
154,655


$
(60,628
)

$
112,227  105




---



##### 



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  Evaluation of Disclosure Controls and Procedures.
  Rules 13a-15(e) 15d-15(e)
  Internal Control over Financial Reporting.
  MANAGEMENTS
    REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
  Rules 13a-15(f) 15d-15(f)
  Internal
    Control  Integrated Framework
    Changes in Internal Controls
    Other
    
    pertain to the maintenance of records that in reasonable detail
    accurately and fairly reflect the transactions and dispositions
    of the assets of the Company; 106




---



##### 




    provide reasonable assurance that transactions are recorded as
    necessary to permit preparation of financial statements in
    accordance with U.S. generally accepted accounting
    principles, and that receipts and expenditures of the Company
    are being made only in accordance with authorizations of
    management and directors of the Company; and
    provide reasonable assurance regarding prevention or timely
    detection of unauthorized acquisition, use, or disposition of
    the Companys assets that could have a material effect on
    the consolidated financial statements.    Item 9B.
    Other
    Information   107




---



##### 



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
     Internal Control  Integrated Framework
        Internal Control 
    Integrated Framework
    KPMG
    LLP
   108




---



##### 



PART III.  Item 10.
    Directors,
    Executive Officers and Corporate Governance                Item 11.
    Executive
    Compensation  Form 10-K,
  Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters    Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence    Item 14.
    Principal
    Accountant Fees and Services   109




---



##### 



PART IV.  Item 15.
    Exhibits
    and Financial Statement Schedules  Financial Statements.
     
 Report of Independent Registered Public
    Accounting Firm


65Consolidated Balance Sheets as of
    December 31, 2009 and 2008


66Consolidated Statements of Operations for the
    years ended December 31, 2009, 2008 and 2007


67Consolidated Statements of Stockholders
    Equity for the years ended December 31, 2009, 2008 and
    2007


68Consolidated Statements of Cash Flows for the
    years ended December 31, 2009, 2008 and 2007


69Notes to Consolidated Financial Statements


71    Financial Statement Schedules.
    Exhibits.
   110




---



##### 



SIGNATURES
    Corporation
  By:
    /s/  James
    W. Truess   Title:
    Chief Financial Officer and
    Executive Vice President    Signatures

Title

Date/s/  James
    G. CarlsonJames
    G. Carlson

Chairman, Chief Executive Officer and President

February 22, 2010/s/  James
    W. TruessJames
    W. Truess

Chief Financial Officer and Executive Vice President

February 22, 2010/s/  Margaret
    M. RoomsburgMargaret
    M. Roomsburg

Chief Accounting Officer and Senior Vice President

February 22, 2010/s/  Thomas
    E. CappsThomas
    E. Capps

Director

February 22, 2010/s/  Jeffrey
    B. ChildJeffrey
    B. Child

Director

February 22, 2010/s/  Emerson
    U. FullwoodEmerson
    U. Fullwood

Director

February 22, 2010/s/  Kay
    Coles JamesKay
    Coles James

Director

February 22, 2010/s/  William
    J. McBrideWilliam
    J. McBride

Director

February 22, 2010/s/  Hala
    ModdelmogHala
    Moddelmog

Director

February 22, 2010/s/  Richard
    D. ShirkRichard
    D. Shirk

Director

February 22, 2010  111




---



##### 



EXHIBIT INDEX
    Form 10-K
  Form 10-K
  ExhibitNumber

Description3
.1

Amended and Restated Certificate of Incorporation of the Company
    (incorporated by reference to exhibit 3.1 to our
    Registration Statement on
    Form S-3
    (No. 333-108831)).3
.2

Amended and Restated By-Laws of the Company (incorporated by
    reference to exhibit 3.1 to our Current Report on
    Form 8-K
    filed on February 14, 2008).4
.1

Form of share certificate for common stock (incorporated by
    reference to exhibit 4.1 to our Registration Statement on
    Form S-1
    (No. 333-347410)).4
.2

Indenture related to the 2.0% Convertible Senior Notes due
    2012 dated March 28, 2007, between AMERIGROUP Corporation
    and The Bank of New York, as trustee (including the form of
    2.0% Convertible Senior Note due 2012) (incorporated by
    reference to exhibit 4.1 to our Current Report on
    Form 8-K
    filed on April 2, 2007).4
.3

Registration Rights Agreement dated March 28, 2007, between
    AMERIGROUP Corporation, Goldman Sachs, & Co., as
    representative of the initial purchasers (incorporated by
    reference to exhibit 4.2 to our Current Report on
    Form 8-K
    filed on April 2, 2007).10
.1

Retirement and Employment Agreement by and between AMERIGROUP
    Corporation and Stanley F. Baldwin, dated August 4, 2009
    (incorporated by reference to exhibit 10.3 to our Current
    Report on
    Form 8-K
    filed on August 10, 2009).10
.2

Confirmation, Re Convertible Note Hedge Transaction, dated
    March 22, 2007 between AMERIGROUP Corporation and Wells
    Fargo Bank, National Association (incorporated by reference to
    exhibit 10.1 to our Current Report on
    Form 8-K
    filed April 3, 2007).10
.3

Confirmation, Re Issuer Warrant Transaction, dated
    March 22, 2007 between AMERIGROUP Corporation and Wells
    Fargo Bank, National Association (incorporated by reference to
    exhibit 10.2 to our Current Report on
    Form 8-K
    filed April 3, 2007).10
.4

Amendment to Confirmation, Re Issuer Warrant Transaction, dated
    April 3, 2007 between AMERIGROUP Corporation and Wells
    Fargo Bank, National Association (incorporated by reference to
    exhibit 10.1 to our Current Report on
    Form 8-K
    filed April 9, 2007).10
.5

AMERIGROUP Corporation Amended and Restated Form 2007 Cash
    Incentive Plan dated November 6, 2008, (incorporated by
    reference to exhibit 10.2 to our Current Report on
    Form 8-K
    filed on November 12, 2008).10
.6

Amendment to AMERIGROUP Corporation 2009 Equity Incentive Plan
    dated August 5, 2009, (incorporated by reference to
    exhibit 10.5 to our Current Report on
    Form 8-K
    filed on August 10, 2009).10
.7

Form 2008 AMERIGROUP Corporation Severance Plan
    (incorporated by reference to exhibit 10.6 to our Current
    Report on
    Form 8-K
    filed on November 12, 2008).10
.7.1

Amendment to the AMERIGROUP Corporation Severance Plan
    (incorporated by reference to exhibit 10.1 to our Current
    Report on
    Form 8-K
    filed on May 4, 2009). 112




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##### 



ExhibitNumber

Description10
.8

Form the Officer and Director Indemnification Agreement
    (incorporated by reference to exhibit 10.16 to our
    Registration Statement on
    Form S-1
    (No. 333-37410)).10
.9

Form of Employee Non-compete, Nondisclosure and Developments
    Agreement (incorporated by reference to exhibit 10.1 to our
    Current Report on
    Form 8-K
    filed on February 23, 2005).10
.10

Form of Incentive Stock Option Agreement (2009 Equity Incentive
    Plan); (incorporated by reference to exhibit 10.2 to our
    Current Report on
    Form 8-K,
    filed on May 4, 2009).10
.11

Form of Nonqualified Stock Option Agreement (2009 Equity
    Incentive Plan); (incorporated by reference to exhibit 10.3
    to our Current Report on
    Form 8-K
    filed on May 4, 2009).10
.12

Form of Restricted Stock Agreement (2009 Equity Incentive Plan);
    (incorporated by reference to exhibit 10.4 to our Current
    Report on
    Form 8-K
    filed on May 4, 2009).10
.13

Form of Stock Appreciation Rights Agreement (2009 Equity
    Incentive Plan); (incorporated by reference to exhibit 10.5
    to our Current Report
    Form 8-K
    filed on May 4, 2009).10
.14

AMERIGROUP Corporation Amended and Restated Form 2005
    Executive Deferred Compensation Plan between AMERIGROUP
    Corporation and Executive Associates dated November 6,
    2008, (incorporated by reference to exhibit 10.4 to our
    Current Report on
    Form 8-K
    filed on November 12, 2008).10
.15

Form of 2005 Non-Employee Director Deferred Compensation Plan
    between AMERIGROUP Corporation and Non-Executive Associates
    (incorporated by reference to exhibit 10.3 to our Current
    Report on
    Form 8-K
    filed on March 4, 2005).10
.16

Employment Agreement of James G. Carlson dated January 16,
    2008 (incorporated by reference to exhibit 10.1 to our
    Current Report on
    Form 8-K
    filed on January 18, 2008).10
.16.1

Amendment No. 1 to Executive Employment Agreement dated
    November 6, 2008 between AMERIGROUP Corporation and James
    G. Carlson (incorporated by reference to exhibit 10.5 to
    our Current Report on
    Form 8-K
    filed on November 12, 2008).10
.16.2

Amendment No. 2 to Executive Employment Agreement dated
    August 4, 2009 between AMERIGROUP Corporation and James G.
    Carlson (incorporated by reference to exhibit 10.1 to our
    Current Report on
    Form 8-K
    filed on August 10, 2009).10
.17

Noncompetition Agreement for James G. Carlson dated
    January 16, 2008 (incorporated by reference to
    exhibit 10.2 to our Current Report on
    Form 8-K
    filed on January 18, 2008).*10
.18

Medical Contract between the State of Florida, Agency for
    HealthCare Administration and AMERIGROUP Florida Inc. (AHCA
    Contract No. FA913) (incorporated by reference to
    Exhibit 10.1 to our Quarterly Report on
    Form 10-Q
    filed on November 4, 2009).10
.19

Amendment No. 3 dated October 23, 2008, Amended and
    Restated Contract between Georgia Department of Community Health
    and AMERIGROUP Georgia Managed Care Company, Inc. for the period
    from July 1, 2008 through June 30, 2009, (incorporated
    by reference to Exhibit 10.4 to our Quarterly Report on
    Form 10-Q
    filed on October 28, 2008).10
.19.1

Amendment No. 4 dated October 23, 2008 between Georgia
    Department of Community Health and AMGP Georgia Managed Care
    Company, Inc. for the period from July 1, 2008 through
    June 30, 2009, (incorporated by reference to
    Exhibit 10.5 to our Quarterly Report on
    Form 10-Q
    filed on October 28, 2008).*10
.19.2

Amendment No. 5 dated October 23, 2008 between Georgia
    Department of Community Health and AMGP Georgia Managed Care
    Company, Inc. for the period from July 1, 2008 through
    June 30, 2009, (incorporated by reference to
    Exhibit 10.6 to our Quarterly Report on
    Form 10-Q
    filed on October 28, 2008).*10
.19.3

Amendment No. 7 dated September 23, 2009 between
    Georgia Department of Community Health and AMGP Georgia Managed
    Care Company, Inc. for the period from July 1, 2009 through
    June 30, 2010, (incorporated by reference to
    Exhibit 10.3 to our Quarterly Report on
    Form 10-Q
    filed on November 4, 2009).*10
.20

Health & Human Services Commission Uniform Managed
    Care Contract covering all service areas and products in which
    the subsidiary has agreed to participate, effective
    September 1, 2006 (incorporated by reference to
    exhibit 10.32.9 to our Quarterly Report on
    Form 10-Q
    filed on November 14, 2006). 113




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##### 



ExhibitNumber

Description*10
.20.1

Amendment, effective September 1, 2007, to the
    Health & Human Services Commission Agreement for
    Health Services to the STAR, STAR+PLUS, CHIP, CHIP Perinatal,
    programs in the Bexar, Dallas, Harris, Nueces, Tarrant and
    Travis Service Delivery Areas effectively extending the contract
    through August 31, 2008 (incorporated by reference to
    Exhibit 10.35.10 to our Quarterly Report on
    Form 10-Q
    filed on November 2, 2007).*10
.20.2

Amendment effective September 1, 2008, to the
    Health & Human Services Commission Agreement for
    Health Services to the STAR, STAR+PLUS, CHIP, CHIP Perinatal
    programs effectively extending the contract through
    August 31, 2009, (incorporated by reference to
    Exhibit 10.1 to our Quarterly Report on
    Form 10-Q
    filed on October 28, 2008).*10
.20.3

Amendment effective March 1, 2009, to the
    Health & Human Services Commission Agreement for
    Health Services to the STAR, STAR+PLUS, CHIP, CHIP Perinatal
    programs effectively extending the contract through
    August 31, 2010, (incorporated by reference to
    Exhibit 10.1 to our Quarterly Report on
    Form 10-Q
    filed on May 5, 2009).*10
.20.4

Amendment effective September 1, 2009, to the
    Health & Human Services Commission Agreement for
    Health Services to the STAR, STAR+PLUS, CHIP, CHIP Perinatal
    programs in the Bexar, Dallas, Harris, Nueces, Tarrant, and
    Travis Service Delivery Areas effectively extending the contract
    through August 31, 2010, (incorporated by reference to
    Exhibit 10.2 to our Quarterly Report on
    Form 10-Q
    filed on November 4, 2009).10
.35

Contractor Risk Agreement between the State of Tennessee and
    AMERIGROUP Tennessee, Inc. effective August 15, 2006,
    (incorporated by reference to exhibit 10.1 to our Current
    Report on
    Form 8-K
    filed on August 21, 2006).10
.35.1

Amendment No. 3 to Contract Risk Agreement between the
    State of Tennessee and AMERIGROUP Tennessee, Inc. effective
    July 1, 2008, (incorporated by reference to
    exhibit 10.8 to our Quarterly Report on
    Form 10-Q
    filed on July 29, 2008).10
.35.2

Amendment No. 4 to Contract Risk Agreement between the
    State of Tennessee and AMERIGROUP Tennessee, Inc. effective
    September 1, 2009, (incorporated by reference to
    exhibit 10.4 to our Quarterly Report on
    Form 10-Q
    filed on November 4, 2009).10
.35.3

Amendment to Amendment No. 4, to Contract Risk Agreement
    between the State of Tennessee and AMERIGROUP Tennessee, Inc.
    effective July 1, 2009, (incorporated by reference to
    exhibit 10.1 to our Current Report on
    Form 8-K
    filed on December 30, 2009).*10
.36

Contract dated August 26, 2008 between the State of New
    Mexico and AMERIGROUP New Mexico, Inc. for the period from
    August 1, 2008 through June 30, 2012, (incorporated by
    reference to Exhibit 10.2 to our Quarterly Report on
    Form 10-Q
    filed on October 28, 2008).10
.37

Settlement Agreement dated as of August 13, 2008, by and
    among the United States of America, acting through the United
    States Department of Justice and on behalf of the Office of
    Inspector General of the Department of Health and Human
    Services; the State of Illinois acting through the Office of the
    Illinois Attorney General; Cleveland A. Tyson; AMERIGROUP
    Corporation; and AMERIGROUP Illinois, Inc. (incorporated by
    reference to Exhibit 10.1 to our Current Report on
    Form 8-K
    filed on August 14, 2008).10
.38.2

AMERIGROUP Corporation Amended and Restated Change in Control
    Benefit Policy dated November 6, 2008 (incorporated by
    reference to Exhibit 10.3 to our Current Report on
    Form 8-K
    filed on November 12, 2008).10
.39

AMERIGROUP Corporation Corporate Integrity Agreement
    (incorporated by reference to Exhibit 10.2 to our Current
    Report on
    Form 8-K
    filed on August 14, 2008).12
.1

Computation of Ratio of Earnings to Fixed Charges14
.1

AMERIGROUP Corporation Amended and Restated Code of Business
    Conduct and Ethics (incorporated by reference to
    Exhibit 14.1 to our Current Report on
    Form 8-K
    filed on August 10, 2009).21
.1

List of Subsidiaries23
.1

Consent of KPMG LLP, Independent Registered Public Accounting
    Firm, with respect to financial statements of the registrant.31
.1

Certification of Chief Executive Officer pursuant to
    Section 302 of Sarbanes-Oxley Act of 2002, dated
    February 22, 2010. 114




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##### 



ExhibitNumber

Description31
.2

Certification of Chief Financial Officer pursuant to
    Section 302 of Sarbanes-Oxley Act of 2002, dated
    February 22, 2010.32


Certification of Chief Executive Officer and Chief Financial
    Officer pursuant to Section 906 of Sarbanes-Oxley Act of
    2002, dated February 22, 2010.     *
    
    The Company has requested confidential treatment of the redacted
    portions of this exhibit pursuant to
    Rule 24b-2,
    under the Securities Exchange Act of 1934, as amended, and has
    separately filed a complete copy of this exhibit with the
    Securities and Exchange Commission. 115