Document:

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                                                                   EXHIBIT 10.27
                                           *** TEXT OMITTED AND FILED SEPARATELY
                                                CONFIDENTIAL TREATMENT REQUESTED
                                          UNDER 17 C.F.R. SECTIONS 200.80(b)(4),
                                                            200.83 AND 240.24b-2

                    INFORMATION TECHNOLOGY SERVICES AGREEMENT

                                     BETWEEN

                         PACIFICARE HEALTH SYSTEMS, INC.

                                       AND

                   INTERNATIONAL BUSINESS MACHINES CORPORATION

                                DECEMBER 31, 2001

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                                TABLE OF CONTENTS
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1.       DEFINITIONS AND CONSTRUCTION...............................................................      1

         1.1      Definitions.......................................................................      1
         1.2      Interpretation....................................................................      1
         1.3      Order of Precedence...............................................................      2

2.       TERM.......................................................................................      2

         2.1      Initial Term......................................................................      2
         2.2      Renewal Term; Extension Period....................................................      2

3.       SERVICES...................................................................................      3

         3.1      Base Services.....................................................................      3
         3.2      Improved Technology...............................................................      4
         3.3      Governmental Approvals; Changes in Laws...........................................      4
         3.4      Third Party Consents..............................................................      5
         3.5      Technical Architecture and Product Standards......................................      6
         3.6      Knowledge Sharing.................................................................      6
         3.7      Break/Fix and Technology Refresh..................................................      6
         3.8      Asset Transfer....................................................................      6
         3.9      Reports...........................................................................      6
         3.10     Right to Use Third Parties........................................................      7

4.       TRANSITION.................................................................................      8

         4.1      Transition Services...............................................................      8
         4.2      Transition Milestones.............................................................      8

5.       NEW SERVICES...............................................................................      8

         5.1      New Services......................................................................      8
         5.2      Third Party Services in Connection with New Services..............................      9

6.       PACIFICARE RESPONSIBILITIES................................................................      9

         6.1      PacifiCare Supplier Relationship Manager..........................................      9
         6.2      PacifiCare Resources..............................................................     10
         6.3      Use of PacifiCare Facilities......................................................     10
         6.4      PacifiCare Policies and Procedures................................................     10

7.       THIRD PARTY AGREEMENTS.....................................................................     11

         7.1      Assigned Agreements...............................................................     11
         7.2      Managed Agreements................................................................     11
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         7.3      Performance Under Agreements......................................................     12

8.       SERVICE LEVELS.............................................................................     12

         8.1      Base Service Levels...............................................................     12
         8.2      Service Levels for New Services...................................................     12
         8.3      Adjustment of Service Levels......................................................     13
         8.4      Root-Cause Analysis...............................................................     13
         8.5      Measurement and Monitoring Tools..................................................     13
         8.6      Continuous Improvement and Best Practices.........................................     13
         8.7      Service Level Credits.............................................................     14

9.       PACIFICARE SATISFACTION AND BENCHMARKING...................................................     14

         9.1      Satisfaction Survey...............................................................     14
         9.2      Benchmarking......................................................................     14

10.      SERVICE LOCATIONS..........................................................................     15

         10.1     Service Locations.................................................................     15
         10.2     Safety and Security Procedures....................................................     15
         10.3     Data Security.....................................................................     15
         10.4     Data Security Breaches............................................................     16
         10.5     Security Relating to Competitors..................................................     16

11.      HUMAN RESOURCES............................................................................     16

12.      SUPPLIER STAFF.............................................................................     16

         12.1     Supplier Client Relationship Manager..............................................     16
         12.2     Key Personnel.....................................................................     17
         12.3     Project Staff.....................................................................     17
         12.4     Subcontractors....................................................................     17
         12.5     Conduct of Supplier Personnel.....................................................     18
         12.6     Non-Competition...................................................................     19

13.      MANAGEMENT AND CONTROL.....................................................................     19

         13.1     Steering Committee................................................................     19
         13.2     Oversight and Management Process; Relationship with Keane.........................     19
         13.3     Policy & Procedures Manual........................................................     21
         13.4     Change Control Procedures.........................................................     21
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14.      PROPRIETARY RIGHTS.........................................................................     22

         14.1     Background Technology.............................................................     22
         14.2     PacifiCare Software...............................................................     22
         14.3     Supplier Software.................................................................     22
         14.4     Supplier Tools....................................................................     23
         14.5     Work Product......................................................................     23
         14.6     Policies and Procedures Manual....................................................     23
         14.7     Upgrades to Software; Refresh of Supplier Equipment...............................     23

15.      DATA.......................................................................................     23

         15.1     Ownership of PacifiCare Data......................................................     23
         15.2     Use of PacifiCare Data............................................................     23
         15.3     Correction and Reconstruction.....................................................     24
         15.4     Return of Data....................................................................     24

16.      CONTINUED PROVISION OF SERVICES............................................................     24

         16.1     Disaster Recovery Plan............................................................     24
         16.2     Force Majeure.....................................................................     25
         16.3     Alternate Source..................................................................     25
         16.4     Allocation of Resources...........................................................     25

17.      PAYMENTS AND INVOICING.....................................................................     26

         17.1     Base Fees.........................................................................     26
         17.2     Base Fees.........................................................................     26
         17.3     Variable Fees and Baseline Adjustments............................................     26
         17.4     Variable Fee Report...............................................................     26
         17.5     Time of Payment...................................................................     27
         17.6     Detailed Invoices.................................................................     27
         17.7     Fee Dispute.......................................................................     27
         17.8     Substantial Change in Baselines...................................................     27
         17.9     Adjustments to Fees...............................................................     27
         17.10    Expenses..........................................................................     27
         17.11    Rights of Set-Off.................................................................     28
         17.12    Proration.........................................................................     28
         17.13    Unused Credits....................................................................     28
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         17.14    [...***...].......................................................................     28

18.      TAXES......................................................................................     28

         18.1      .................................................................................     28
         18.2      .................................................................................     28
         18.3      .................................................................................     29
         18.4      .................................................................................     29
         18.5      .................................................................................     29
         18.6      .................................................................................     29

19.      AUDITS.....................................................................................     29

         19.1     Services..........................................................................     29
         19.2     Fees..............................................................................     30
         19.3     Omnibus Reconciliation Act........................................................     30
         19.4     Record Retention..................................................................     31
         19.5     Facilities........................................................................     31
         19.6     Audit Software....................................................................     31
         19.7     Relief............................................................................     31

20.      CONFIDENTIALITY............................................................................     31

         20.1     General Obligations...............................................................     31
         20.2     Exceptions........................................................................     31
         20.3     Attorney-Client Privilege.........................................................     32
         20.4     Unauthorized Acts.................................................................     32
         20.5     Injunctive Relief.................................................................     33
         20.6     Residual Information..............................................................     33

21.      REPRESENTATIONS AND WARRANTIES.............................................................     33

         21.1     By PacifiCare.....................................................................     33
         21.2     By Supplier.......................................................................     34
         21.3     Disclaimer........................................................................     34

22.      ADDITIONAL COVENANTS.......................................................................     35

         22.1     By PacifiCare.....................................................................     35
         22.2     By Supplier.......................................................................     35

23.      DISPUTE RESOLUTION.........................................................................     36

         23.1     Resolution Procedures.............................................................     36
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                                              * CONFIDENTIAL TREATMENT REQUESTED

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         23.2     Exclusions........................................................................     36
         23.3     Continuity of Services............................................................     36

24.      TERMINATION................................................................................     37

         24.1     Termination for Convenience.......................................................     37
         24.2     Termination for Change in Control.................................................     37
         24.3     Termination for Cause.............................................................     37
         24.4     Termination for Failure to Provide Critical Services..............................     37
         24.5     Termination in Part...............................................................     38

25.      TERMINATION FEES...........................................................................     38

         25.1     Early Termination Fee.............................................................     38
         25.2     Asset Purchase....................................................................     38
         25.3     No Other Fees.....................................................................     38

26.      TERMINATION ASSISTANCE.....................................................................     38

         26.1     Termination Assistance Services...................................................     38
         26.2     Termination Assistance Services Fees..............................................     39
         26.3     Exit Duties and Exit Rights.......................................................     40

27.      INDEMNITIES................................................................................     41

         27.1     Indemnity by PacifiCare...........................................................     41
         27.2     Indemnity by Supplier.............................................................     42
         27.3     Indemnification Procedures........................................................     44
         27.4     Obligation to Replace.............................................................     44

28.      DAMAGES....................................................................................     45

         28.1     Consequential Damages.............................................................     45
         28.2     Direct Damages....................................................................     45
         28.3     Basis of the Bargain..............................................................     45
         28.4     Exclusions........................................................................     46

29.      INSURANCE..................................................................................     46

         29.1     Types and Amounts.................................................................     46
         29.2     Supplier Agents...................................................................     47
         29.3     Documentation.....................................................................     47
         29.4     Self Insurance....................................................................     47
         29.5     Intentions........................................................................     47
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         30.      Miscellaneous Provisions..........................................................     48
         30.1     Amendments........................................................................     48
         30.2     Assignment........................................................................     48
         30.3     Assignment of Claims..............................................................     48
         30.4     Bankruptcy........................................................................     48
         30.5     Conflict of Interest..............................................................     48
         30.6     Consents, Approvals and Requests..................................................     49
         30.7     Corporate Integrity...............................................................     49
         30.8     Counterparts......................................................................     49
         30.9     Covenant of Further Assurances....................................................     49
         30.10    Entire Agreement..................................................................     49
         30.11    Export............................................................................     49
         30.12    Good Faith and Fair Dealing ......................................................     49
         30.13    Governing Law and Venue...........................................................     50
         30.14    Notices...........................................................................     50
         30.15    Publicity.........................................................................     51
         30.16    Relationship......................................................................     51
         30.17    Severability......................................................................     51
         30.18    Survival..........................................................................     52
         30.19    Third Party Beneficiaries.........................................................     52
         30.20    Timing and Cumulative Remedies....................................................     52
         30.21    Waivers...........................................................................     52
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                    INFORMATION TECHNOLOGY SERVICES AGREEMENT

         THIS INFORMATION TECHNOLOGY SERVICES AGREEMENT (the "AGREEMENT"), dated
as of December 31, 2001 (the "EFFECTIVE DATE"), is between PACIFICARE HEALTH
SYSTEMS, INC., a Delaware corporation with its principal place of business at
3120 W. Lake Center Drive, Santa Ana, California, 92704 ("PACIFICARE"), and
INTERNATIONAL BUSINESS MACHINES CORPORATION, a New York corporation with its
principal place of business at Route 100, Somers, New York 10589 ("SUPPLIER").

                                    RECITALS

         WHEREAS, the PacifiCare Entities (defined below) currently receive
information technology ("IT"), data processing and related services from
internal staff and certain third party providers;

         WHEREAS, the PacifiCare Entities desire to centralize the delivery of
their IT services to maximize efficiency, improve the speed of delivering IT
solutions for new business opportunities and improve IT service levels;

         WHEREAS, PacifiCare desires for the PacifiCare Entities to obtain from
Supplier, and Supplier desires to provide to the PacifiCare Entities, certain
IT, data processing and related services whereby the PacifiCare Entities shall
be provided with a stable and robust operating environment with sufficient
capacity and scalability to meet business objectives on a proactive, rather than
reactive, basis, in accordance with the terms and conditions of this Agreement;
and

         WHEREAS, PacifiCare and Supplier have engaged in extensive negotiations
and discussions that have culminated in the formation of the relationship
described in this Agreement whereby Supplier shall provide to the PacifiCare
Entities certain information technology, data processing and related services,
in accordance with the terms and conditions of this Agreement.

         NOW, THEREFORE, for and in consideration of the agreements set forth
below, PacifiCare and Supplier agree as follows:

                                    AGREEMENT

1.       DEFINITIONS AND CONSTRUCTION.

         1.1 DEFINITIONS. Capitalized terms used in this Agreement shall have
the meanings set forth in Exhibit A.

         1.2 INTERPRETATION.

                  (a) The schedules and exhibits attached to this Agreement are
hereby incorporated into and deemed part of this Agreement and all references to
"Agreement" include the schedules and exhibits to this Agreement.

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                  (b) The headings preceding the text of sections, the headings
to schedules and exhibits, the table of contents and the table of schedules
included in or attached to this Agreement are used for convenience only and are
not to be considered in construing or interpreting this Agreement.

                  (c) The use of the terms "including," "include" or "includes"
shall in all cases herein mean "including without limitation," "include without
limitation" or "includes without limitation," respectively.

                  (d) Words importing the singular include the plural and words
importing the masculine include the feminine and vice versa where the context so
requires.

                  (e) References to any Law shall mean references to the Law as
it exists on the Effective Date as well as in changed or supplemented form or to
a newly adopted Law.

                  (f) The Parties acknowledge and agree that they have mutually
negotiated the terms and conditions of this Agreement and that any provision
contained herein with respect to which an issue of interpretation or
construction arises shall not be construed to the detriment of the drafter on
the basis that such Party or its professional advisor was the drafter, but shall
be construed according to the intent of the Parties as evidenced by the entire
Agreement.

         1.3 ORDER OF PRECEDENCE. Except as otherwise expressly set forth in the
body of this Agreement or in any schedules or exhibits, in the event of a
conflict, ambiguity or inconsistency between the provisions in the body of this
Agreement and any schedule or exhibit, the provisions in the body of this
Agreement shall prevail.

2.       TERM.

         2.1 INITIAL TERM. The initial term of this Agreement (the "INITIAL
TERM") shall commence on the Effective Date and continue until 23:59 (Pacific
Time) on December 31, 2011 (the "INITIAL TERM EXPIRATION DATE"), or such earlier
date upon which this Agreement may be terminated in accordance with the
provisions hereof.

         2.2 RENEWAL TERM; EXTENSION PERIOD.

                  (a) Unless this Agreement is terminated in accordance with the
provisions hereof, PacifiCare shall notify Supplier at least one hundred and
eighty (180) days prior to the Initial Term Expiration Date as to whether or not
PacifiCare desires to renew this Agreement. If PacifiCare provides Supplier with
notice that it desires to renew this Agreement for a specified period (the
"RENEWAL TERM") and the Parties agree on the terms and conditions applicable to
the Renewal Term at least sixty (60) days prior to the Initial Term Expiration
Date, then this Agreement shall continue in effect beyond the Initial Term
Expiration Date in accordance with the terms and conditions agreed upon by the
Parties for the Renewal Term. If PacifiCare provides Supplier with notice that
it does not desire to renew this Agreement, this Agreement shall expire on the
Initial Term Expiration Date, subject to Supplier's obligation to provide
Termination Assistance Services as set forth in this Agreement.

                                       2
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                  (b) If PacifiCare provides Supplier with notice that it
desires to renew this Agreement and the Parties have not agreed on the terms and
conditions applicable to a Renewal Term at least sixty (60) days prior to the
Initial Term Expiration Date, then the term of this Agreement shall extend for a
period determined by PacifiCare of up to twelve (12) months beyond the Initial
Term Expiration Date (the "EXTENSION PERIOD"), at the charges, terms and
conditions in effect as of the Initial Term Expiration Date. If, during the
Extension Period, the Parties are able to reach agreement on the terms and
conditions applicable to a Renewal Term, then this Agreement shall continue in
effect beyond the end of the Extension Period in accordance with the terms and
conditions agreed upon by the Parties for the Renewal Term. If, during the
Extension Period, the Parties are unable to reach agreement on the terms and
conditions applicable to a Renewal Term, this Agreement shall expire at the end
of the Extension Period, subject to Supplier's obligation to provide Termination
Assistance Services as set forth in this Agreement.

3.       SERVICES.

         3.1 BASE SERVICES. Commencing on the Effective Date and continuing
throughout the Initial Term and any Renewal Term or Extension Period, if
applicable (collectively, "TERM"), Supplier shall be responsible for providing
to the PacifiCare Entities (with respect to each PacifiCare Entity, as requested
by PacifiCare) the following services (collectively, the "BASE SERVICES"):

                  (a) the services, functions, tasks and responsibilities
described in this Agreement (including the services, tasks, functions,
responsibilities and projects described in Exhibit B (Statement of Work));

                  (b) the services, functions, tasks and responsibilities being
performed prior to the Effective Date by the Affected Employees set forth in
Schedule 3.1(b)(i) and the Affected Contractors set forth in Schedule 3.1(b)(ii)
or such other PacifiCare Entities' employees and contractors whose services,
functions or responsibilities were eliminated as a result of this Agreement, in
each case, if such service, function, task or responsibility could reasonably be
characterized as inherent to a service, function, task or responsibility
described in Exhibit B (Statement of Work), even if the service, function, task
or responsibility is not specifically described in this Agreement;

                  (c) any services, functions, tasks or responsibilities that
are not specifically described in this Agreement, but that are required for the
proper performance and delivery of the Services; and

                  (d) those services otherwise identified in this Agreement as
part of the Base Services.

                  Subject to Section 17.3, Supplier shall increase or decrease
the amount of the Base Services according to PacifiCare's request for the Base
Services. With respect to additional business units or entities that PacifiCare
may designate as PacifiCare Included Affiliates, PacifiCare and Supplier shall
negotiate in good faith any New Service associated with integrating such new
PacifiCare Included Affiliates, including applicable transition fees, if any.

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Notwithstanding the foregoing, PacifiCare is not obligated to obtain the
Services from Supplier with respect to any additional entity or business unit or
in connection with any acquisition or corporate combination.

         3.2 IMPROVED TECHNOLOGY. Throughout the Term, Supplier shall: (a)
maintain a level of technology used to provide the Services that (i) allows the
PacifiCare Entities to take advantage of technological advances in order to
remain competitive in the markets that the PacifiCare Entities serve, (ii) is at
least current with the level of technology that Supplier uses in providing
services to its other customers who receive services comparable to the Services,
and (iii) is at least current with the level of technology generally adopted
from time to time in the PacifiCare Entities' industries; provided that Supplier
can maintain such level of technology through technology and resources available
to Supplier that do not require a level of investment not otherwise made or
contemplated by Supplier in providing services to similarly situated customers;
(b) jointly, with PacifiCare, on an ongoing basis identify and evaluate the
least cost/highest benefit methods to implement technology advancements and
improved methodologies and processes that represent advancements, improved
methods, and processes in addition to the level of technology evolution,
advancement and improvement otherwise contemplated by this Agreement ("IMPROVED
TECHNOLOGY"); (c) implement such Improved Technology after obtaining
PacifiCare's consent thereto (implementation of which may be effectuated
pursuant to Section 5.1, as agreed by the Parties); and (d) meet with
PacifiCare, upon PacifiCare's request and at least once during every ninety
(90)-day period, in accordance with the procedures agreed upon by the PacifiCare
Supplier Relationship Manager and the Supplier Client Relationship Manager to
inform PacifiCare of any new information technology Supplier is developing or
information technology trends and directions that Supplier, in the ordinary
course of its business, is aware of and that could reasonably be expected to
have an impact on the PacifiCare Entities' business, taking into consideration
the PacifiCare Entities' use of the Services.

         3.3 GOVERNMENTAL APPROVALS; CHANGES IN LAWS.

                  (a) GOVERNMENTAL APPROVALS. PacifiCare shall, at its own cost
and expense, obtain and maintain all licenses, approvals, permits, consents and
authorizations of any Governmental Authority, and provide any notice to any
Governmental Authority, that PacifiCare is required by Law to obtain, maintain,
or provide, other than Supplier Governmental Approvals ("PACIFICARE GOVERNMENTAL
APPROVALS"). Supplier shall, at its own cost and expense, obtain and maintain
all licenses, approvals, permits, consents and authorizations of any
Governmental Authority, and provide any notice to any Governmental Authority,
that Supplier is required by Law to obtain, maintain, or provide, together with
any licenses, approvals, permits, consents, authorizations and notices required
by Law in connection with or as a result of the provision or receipt of the
Services ("SUPPLIER GOVERNMENTAL APPROVALS").

                  (b) CHANGES IN SUPPLIER LAWS AND PACIFICARE LAWS. PacifiCare
shall monitor and promptly identify and notify Supplier of all changes in Laws
applicable to PacifiCare that affect the provision or receipt of the Services,
other than Supplier Laws ("PACIFICARE LAWS"). Supplier shall monitor and
promptly identify and notify PacifiCare of all changes in Laws applicable to
Supplier that affect the provision or receipt of the Services,

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together with any changes in Laws applicable to either Party that apply to the
provision or receipt of information technology outsourcing services and that
affect the PacifiCare Entities or the provision or receipt of the Services
("SUPPLIER LAWS").

                  (c) EFFECT OF CHANGES IN LAWS. Supplier and PacifiCare shall
work together to identify the effect of changes in Laws on the provision or
receipt of the Services. PacifiCare shall notify Supplier of changes in
PacifiCare Laws and the Parties shall discuss modifications to the Services, if
any, necessary to comply with such changes in PacifiCare Laws. Supplier shall
promptly thereafter propose any adjustment to the applicable Fees associated
with such modifications. Upon PacifiCare's consent, Supplier shall implement
such modifications to the Services in a timely manner subject to the Change
Control Procedures. Supplier shall notify PacifiCare of changes in Supplier Laws
and Supplier shall implement in a timely manner, at its own cost and expense,
any changes in the Services required to comply with such changes in Supplier
Laws; provided, however, that if such changes have a material effect on the
provision or receipt of the Services, Supplier shall obtain PacifiCare's consent
before implementing such changes.

                  (d) DEPARTMENT OF MANAGED HEALTH CARE. Without limiting the
Parties' obligations under this Section 3, the Parties agree to cooperate with
each other to address any issues, concerns or requests regarding the provisions
of this Agreement or the provision or receipt of the Services with respect to
PacifiCare of California (DMHC File No. 933-0126), PacifiCare Behavioral Health
of California, Inc. (DMHC File No. 933-0301) and/or PacifiCare Dental (DMHC File
No. 933-0100), expressed by the California Department of Managed Health Care
("DMHC") arising from or related to DMHC File 933-0100, "Amendment to
Administrative and Solicitor Firm Services Agreement with Affiliate," which
PacifiCare submitted to the DMHC on December 17, 2001 (the "DMHC FILING"). To
the extent in responding to the DMHC Filing, the DMHC expresses requirements
that necessitate changes to the Agreement or to the Services, which changes
apply only because of the consummation of the transactions specified in this
Agreement ("DMHC REQUIREMENTS"), the Parties agree to negotiate in good faith
and to make equitable adjustments to this Agreement as may be necessary to
accommodate the DMHC Requirements. If any DMHC Requirements require a material
alteration to the Services, the Parties shall [...***...].

         3.4 THIRD PARTY CONSENTS. Supplier shall obtain the Front-End Consents
and PacifiCare shall cooperate with Supplier in obtaining such consents upon
Supplier's request. With respect to any fees and expenses payable to third
parties in connection with obtaining the Front-End Consents, (i) Supplier shall
pay [...***...], (ii) PacifiCare shall pay [...***...].

                                              * CONFIDENTIAL TREATMENT REQUESTED

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In the event Supplier demonstrates to PacifiCare's reasonable satisfaction that
Supplier is unable to obtain a Front-End Consent despite using all reasonable
efforts to obtain such consent, Supplier shall promptly develop a workaround
acceptable to PacifiCare that enables Supplier to perform its obligations under
this Agreement despite the lack of such consent, and, upon receiving
PacifiCare's approval, implement such workaround. The Parties shall [...***...].
The Parties shall use good faith efforts to minimize costs with regard to
Front-End Consents and with regard to workarounds, if any, including, as agreed
by the Parties, changing the classification of third party agreements subject to
Section 7 (e.g., from Assigned Agreement to Managed Agreement or vice versa).
The Parties shall agree on an appropriate adjustment to the Fees in connection
with any reclassification of such third party agreements prior to implementing
such reclassification. Each Party shall comply with the terms and conditions of
the Consents applicable to such Party.

         3.5 TECHNICAL ARCHITECTURE AND PRODUCT STANDARDS. Supplier shall comply
with PacifiCare's information management technical architecture and product
standards set forth in Schedule 3.5, as the same may be modified through the
Change Control Procedures by PacifiCare from time to time during the Term and
the Termination Assistance Period.

         3.6 KNOWLEDGE SHARING. At least [...***...] every Contract Year, or
upon request after at least fifteen (15) days notice from PacifiCare, Supplier
shall provide knowledge sharing assistance to PacifiCare, including meeting with
representatives of PacifiCare, in order to explain how the Systems work and
should be operated and how the Services are provided. In connection with such
knowledge sharing, Supplier will also provide copies of existing information and
documentation as PacifiCare may require for PacifiCare to understand, operate,
maintain and enhance the Systems and provide the Services. PacifiCare shall not
make more than [...***...] requests in any Contract Year for such knowledGe
sharing.

         3.7 BREAK/FIX AND TECHNOLOGY REFRESH. As part of the Base Services,
Supplier is responsible for all necessary procurement activities and charges for
break/fix and technology refresh described in Exhibit B (Statement of Work).

         3.8 ASSET TRANSFER. On the Effective Date, Supplier shall purchase the
Assets upon payment to PacifiCare of twenty five million dollars ($25,000,000)
in cash by wire transfer to an account specified by PacifiCare, and the issuance
of a promissory note in the amount of seventeen million dollars ($17,000,000) in
the form attached as Schedule 3.8(a). Supplier shall be responsible for, and
shall pay, all sales, use and other similar taxes arising out of or in
connection with, the transfer of the Assets by PacifiCare to Supplier. Upon
receipt of the twenty five million dollar ($25,000,000) payment specified above,
PacifiCare shall assign and transfer to Supplier the Assets by delivery of a
general assignment and bill of sale in the form of Schedule 3.8(b), duly
executed by PacifiCare and Supplier.

         3.9 REPORTS.

                  (a) ANNUAL PLAN.

                           (i) One hundred twenty (120) days preceding the end
of each calendar year, PacifiCare shall provide to Supplier a proposed set of
estimated baselines for anticipated

                                              * CONFIDENTIAL TREATMENT REQUESTED

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PacifiCare IT requirements for the subsequent calendar year (the "PACIFICARE
ESTIMATED BASELINE REQUIREMENTS"). The PacifiCare Estimated Baseline
Requirements may include: business requirements; long and short-term goals; IT
strategy revisions; capital projects; facility changes (if any); technology
enhancements or changes (including, hardware, software, networks, systems and
PCs); PC support changes; regional changes; IMAC changes; and an annual budget
plan.

                           (ii) Supplier shall provide to PacifiCare its written
response to the PacifiCare Estimated Baseline Requirements within sixty (60)
days of receipt ("SUPPLIER'S REPLY"). Where appropriate, Supplier's Reply shall
address: technology strategies, operational plans (as necessary) and any program
management changes; changes to standard configurations for hardware, software,
networks and systems; changes within the organization, including new employees
and new subcontractors; changes in geographical location of subcontractors;
Supplier Fees including any retained expenses; changes in the Base Services;
changes in Service Levels and Service Level Credits; and new or added value
projects.

                           (iii) Within thirty (30) days after PacifiCare's
receipt of Supplier's Reply, the Parties shall formulate a written plan to meet
PacifiCare's anticipated needs for the subsequent calendar year (the "ANNUAL
PLAN"). The Parties shall use good faith efforts to review, approve and adopt
the Annual Plan prior to the end of each calendar year. After the Annual Plan is
adopted, the Parties may negotiate in good faith to make equitable adjustments
as necessary. Such equitable adjustments shall be in writing and signed by both
Parties. Supplier shall maintain all approved changes in writing and shall
notify PacifiCare of such changes in writing.

                  (b) In addition to the Annual Plan, Supplier shall provide to
PacifiCare, in a format approved by PacifiCare, a set of reports, including
performance, utilization, billing and status reports, as set forth in Schedule
3.9(b) and as otherwise reasonably available to Supplier. Supplier shall provide
all reports as frequently as PacifiCare reasonably requires.

         3.10 RIGHT TO USE THIRD PARTIES. PacifiCare may perform itself, or
contract with one or more third parties to perform (in either case, "INSOURCE"),
all or any portion of the Services, provided that any portion of the Services
Insourced shall represent an entire baseline or baselines for a particular
Resource Unit described in Schedule 17, and not a portion thereof. Supplier
shall reduce the Fees proportionately in accordance with Section 17.3 upon the
effective date of the Insourcing, provided that, during each Contract Year,
PacifiCare shall be obligated to pay Supplier a minimum of [...***...] oF the
Base Fees specified in Schedule 17 (as such schedule exists on the Effective
Date) for such Contract Year. PacifiCare shall pay Wind Down Costs, if any,
associated with such Insourcing only with respect to assets dedicated solely to
providing the Services in connection with the Insourced Resource Unit's
baselines. In connection with any Insourcing, Supplier agrees to cooperate in
good faith with PacifiCare and/or any third party provider to the extent
reasonably required by PacifiCare, including provision of (a) written
requirements, standards, and procedures for PacifiCare systems maintained by
Supplier so that the enhancements or developments of such third party may be
operated in conjunction with Services, (b) assistance and support services to
such third party at competitive market prices and (c) access to the Software and
the Equipment as may be reasonably required by such third party and PacifiCare
in connection with Services.

                                              * CONFIDENTIAL TREATMENT REQUESTED

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4.       TRANSITION AND CONSOLIDATION.

         4.1 TRANSITION SERVICES. Supplier shall perform all functions and
services necessary to accomplish the transition and consolidation of the
PacifiCare Entities' information technology operations and capabilities (the
"TRANSITION SERVICES"). The Transition Services shall be performed in accordance
with the Transition Plan attached hereto as Schedule 4.1 (as may be amended by
Supplier and PacifiCare following the Effective Date) and without causing a
material disruption to the PacifiCare Entities' business. The Transition
Services shall commence on the Effective Date and shall continue for the period
specified in the Transition Plan (the "TRANSITION PERIOD"). Supplier shall
designate one of its Key Personnel (as specified in Schedule 12.2), and notify
PacifiCare of the identity of such individual, for each of the PacifiCare
Entities' facilities and functions being transitioned in accordance with this
Agreement who shall be responsible for managing and implementing the Transition
Services with respect to such functions or services. Until the completion of the
applicable Transition Services, each such individual shall review with the
PacifiCare Supplier Relationship Manager the status of the Transition Services
for which that individual is responsible as often as may be reasonably requested
by the PacifiCare Supplier Relationship Manager.

         4.2 TRANSITION MILESTONES. The Transition Plan includes a list of
milestones and deliverables relating to Supplier's obligations pursuant to this
Section 4, together with, for each such milestone or deliverable a start date
and the time period in which Supplier must complete such milestone or deliver
such deliverable. The amount of the Base Fees subject to Service Level Credits
in relation to certain transition milestones and deliverables is set forth in
Schedule 8. PacifiCare's right to receive Service Level Credits under Schedule 8
shall not limit PacifiCare's right to recover other damages incurred by
PacifiCare as a result of the performance failure that caused the Service Level
Credit to be incurred [...***...].

5.       NEW SERVICES.

         5.1 NEW SERVICES. PacifiCare may, from time to time during the Term,
request that Supplier perform a New Service. Within ten (10) business days of
Supplier's receipt of such a request from PacifiCare, or within another time
period acceptable to the Parties, Supplier shall, and to the extent applicable,
jointly with Keane, provide PacifiCare with a written proposal for such New
Service that shall include:

                  (a) a description of the services, functions and
responsibilities Supplier anticipates performing in connection with such New
Service;

                  (b) a schedule for commencing and completing such New Service;

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       8
<PAGE>

                  (c) Supplier's prospective fees for such New Service,
including a detailed breakdown of such fees, together with proposed Service
Levels for such New Service;

                  (d) when appropriate, a description of any new Software or
Equipment to be provided by Supplier in connection with such New Service;

                  (e) when appropriate, the Software and Equipment and run-time
requirements necessary to develop and operate any new Software;

                  (f) a description of the human resources necessary to provide
the New Service;

                  (g) when appropriate, a list of any existing Software or
Equipment included in or to be used in connection with such New Service;

                  (h) when appropriate, acceptance test criteria and procedures
for any new Software or any products, packages or services; and

                  (i) such other information requested by PacifiCare.

                  PacifiCare shall not be obligated to pay for any New Service
and Supplier shall not be obligated to perform any New Service until the
PacifiCare Supplier Relationship Manager has provided Supplier with the
authorization to perform the New Service.

         5.2 THIRD PARTY SERVICES IN CONNECTION WITH NEW SERVICES.
Notwithstanding any request made by PacifiCare to Supplier pursuant to Section
5.1 or any other provision of this Agreement, PacifiCare shall have the right to
perform itself, or to contract with a third party to perform, any New Service.
Upon PacifiCare's request, Supplier shall assist PacifiCare in identifying
qualified third party suppliers to provide New Services. In the event PacifiCare
performs itself, or contracts with a third party to perform, any New Service,
Supplier shall cooperate in good faith with PacifiCare and/or any such third
party to the extent reasonably required by PacifiCare. If such cooperation
related to third parties not subject to a Managed Agreement requires Supplier to
use resources not included within the Fees, Supplier shall, before providing
such cooperation, notify PacifiCare that Supplier believes that it is entitled
to additional compensation for providing such cooperation, and advise PacifiCare
of the proposed additional compensation. PacifiCare and Supplier shall negotiate
in good faith with regard to the amount of any additional compensation
applicable to such cooperation.

6.       PACIFICARE RESPONSIBILITIES.

         6.1 PACIFICARE SUPPLIER RELATIONSHIP MANAGER. PacifiCare shall appoint
an individual (the "PACIFICARE SUPPLIER RELATIONSHIP MANAGER") who, from the
Effective Date, shall serve as the primary PacifiCare representative under this
Agreement. The PacifiCare Supplier Relationship Manager shall (a) have overall
responsibility for managing and coordinating the performance of PacifiCare's
obligations under this Agreement and (b) be authorized to act for and on behalf
of the PacifiCare Entities with respect to all matters relating to this
Agreement. Notwithstanding the foregoing, the PacifiCare Supplier Relationship

                                       9
<PAGE>

Manager may, upon notice to Supplier, delegate such of his or her
responsibilities to other PacifiCare employees as the PacifiCare Supplier
Relationship Manager deems appropriate.

         6.2 PACIFICARE RESOURCES. Commencing on the Effective Date and
continuing for so long as Supplier requires the same for the performance of the
Services, PacifiCare shall provide to Supplier, at no charge to Supplier and
subject to Section 6.3, the same or similar access to and use of certain space
in PacifiCare's premises, together with reasonable office furnishings,
janitorial services and utilities, to the extent PacifiCare otherwise provides
to its employees and subcontractors performing work for PacifiCare at such
facilities. Supplier's use of such premises shall be in accordance with
PacifiCare's policies and procedures in effect from time to time.

         6.3 USE OF PACIFICARE FACILITIES.

                  (a) Except as expressly provided in this Agreement, Supplier
shall use the PacifiCare Service Locations for the sole and exclusive purpose of
providing the Services. Use of such facilities by Supplier does not constitute a
leasehold interest in favor of Supplier or any of Supplier's customers. Use of
PacifiCare Service Locations shall be subject to the rules and regulations
attached as Schedule 6.3(a).

                  (b) Supplier shall use the PacifiCare Service Locations in an
efficient manner. To the extent that Supplier operates the space in a manner
that unnecessarily and materially increases facility costs incurred by
PacifiCare, PacifiCare shall notify Supplier of such costs and Supplier shall
take such steps as may be necessary to reduce such facility costs to a level
acceptable to PacifiCare.

                  (c) Supplier and Supplier Agents shall keep the PacifiCare
Service Locations in good order, not commit or permit waste or damage to such
facilities (ordinary wear and tear excepted), not use such facilities for any
unlawful purpose or act.

                  (d) Supplier shall permit the PacifiCare Entities and the
PacifiCare Entity Agents to enter into those portions of the PacifiCare Service
Locations occupied by Supplier's staff at reasonable times to perform
facilities-related services.

                  (e) Supplier shall not make any improvements or changes
involving structural, mechanical or electrical alterations to the PacifiCare
Service Locations without PacifiCare's prior consent. Any additions,
improvements or changes made by Supplier shall be deemed the property of
PacifiCare without further consideration.

                  (f) When the PacifiCare Service Locations are no longer
required for performance of the Services, Supplier shall return such locations
to PacifiCare in substantially the same condition as when Supplier began using
such locations, as the same may be modified in accordance with Section 6.3(e),
ordinary wear and tear excepted.

         6.4 PACIFICARE POLICIES AND PROCEDURES. Supplier shall, and shall cause
all Supplier Agents to, comply with the PacifiCare policies and procedures
(including physical security procedures, such as bag searches) made available to
the Supplier Client Relationship Manager from time to time during the Term and
Termination Assistance Period, including those policies and procedures available
at the URL designated for such purpose by PacifiCare. New policies

                                        10
<PAGE>

and procedures, and any Changes caused by changes to existing policies and
procedures, will be subject to the Change Control Procedures.

7.       THIRD PARTY AGREEMENTS.

         7.1 ASSIGNED AGREEMENTS. As of Effective Date, Supplier shall assume
all responsibility (including all obligations and post assignment liability) for
the Assigned Agreements as set forth in Schedule 7.1.

                  (a) ONGOING RESPONSIBILITIES. Supplier may, to the extent
permitted by any Assigned Agreement, renew, modify, terminate or cancel, or
request or grant any consents or waivers under, any such Assigned Agreement.
Supplier shall have financial and administrative responsibility with respect to
the Assigned Agreements, including responsibility for performance of all
obligations under the Assigned Agreements.

                  (b) ASSIGNED AGREEMENT INVOICES. PacifiCare and Supplier shall
arrange for Supplier to receive the Assigned Agreement invoices directly from
the applicable third party. Supplier shall be responsible for payment of
invoiced amounts submitted by third parties for expenses incurred pursuant to
the Assigned Agreements after the Effective Date, including any associated late
fees. If PacifiCare receives any invoices for amounts incurred under the
Assigned Agreement invoices after the Effective Date, PacifiCare shall provide
those invoices to Supplier within a reasonable time period to permit timely
payment by Supplier or, if a discount for payment is offered, the date on which
Supplier may pay such Managed Agreement Invoice with a discount. Supplier shall
be responsible for payment of such invoices, except for any late fees associated
therewith that are incurred because of PacifiCare's failure to comply with the
preceding sentence. Additionally, Supplier shall be responsible for payment of
any modification, termination or cancellation fees or charges imposed upon the
PacifiCare Entities in connection with any modification, termination or
cancellation of, or consent or waiver under, any Assigned Agreement. If, prior
to the Effective Date, PacifiCare prepaid any amounts under any Assigned
Agreements which apply to expenses incurred after the Effective Date, then
Supplier shall reimburse or credit PacifiCare for such amounts on the next
invoice delivered by Supplier for the Services. In the event Supplier receives
during the Term any refund, credit or other rebate (including deposits) in
connection with any Assigned Agreement that is attributable to periods prior to
the Effective Date, then Supplier shall promptly notify PacifiCare of such
refund, credit or rebate and shall promptly pay to PacifiCare the full amount of
such refund, credit or rebate.

         7.2 MANAGED AGREEMENTS. Supplier shall, as an agent of PacifiCare,
administer the operational aspects of the Managed Agreements, such as
monitoring, reviewing and managing third party performance under such
agreements, escalating performance issues, initiating Managed Agreement review
meetings with PacifiCare on a regular basis, and performing any other tasks set
forth in this Section 7.2.

                  (a) ONGOING RESPONSIBILITIES. Supplier shall have
administrative (but not financial) responsibility during the Term with respect
to the Managed Agreements, and Supplier shall provide PacifiCare with reasonable
notice of all renewal, termination or cancellation dates and fees with respect
to the Managed Agreements. Except as reasonably required to provide the Services
in accordance with the applicable Service Levels, Supplier shall not renew,
modify,

                                       11
<PAGE>

terminate or cancel, or request or grant any consents or waivers under any
Managed Agreements without the consent of the PacifiCare Supplier Relationship
Manager. Supplier shall pay or discharge, as applicable, any fees or charges or
other liability or obligation imposed upon PacifiCare in connection with (i) any
renewal, modification, termination or cancellation of, or consent or waiver
under the Managed Agreements obtained or given without PacifiCare's consent as
required under the foregoing sentence or (ii) Supplier's failure to comply with
the terms of the Managed Agreements.

                  (b) MANAGED AGREEMENT INVOICES. Supplier shall (i) receive all
Managed Agreement Invoices, (ii) review and correct any errors in any such
Managed Agreement Invoices in a timely manner and (iii) submit such Managed
Agreement Invoices to PacifiCare within a reasonable period of time prior to the
due date or, if a discount for payment is offered, the date on which PacifiCare
may pay such Managed Agreement Invoice with a discount. PacifiCare shall pay the
Managed Agreement Invoices received and approved by Supplier. PacifiCare shall
only be responsible for payment of the Managed Agreement Invoices and shall not
be responsible to Supplier for any management, administration or maintenance
fees of Supplier in connection with the Managed Agreement Invoices. PacifiCare
shall be responsible for any late fees in respect of the Managed Agreement
Invoices, provided that Supplier submitted the applicable Managed Agreement
Invoices to PacifiCare for payment within a reasonable period of time prior to
the date any such Managed Agreement Invoice is due. If Supplier fails to submit
a Managed Agreement Invoice to PacifiCare for payment in accordance with the
preceding sentence, Supplier shall be responsible for any discount that would
have been received had Supplier complied with the preceding sentence or any late
fees with respect to such Managed Agreement Invoice.

         7.3 PERFORMANCE UNDER AGREEMENTS. Supplier and PacifiCare shall
promptly notify the other of any breach of, or misuse or fraud in connection
with, any PacifiCare Third Party Contracts of which such Party becomes aware and
shall cooperate with the other to prevent or stay any such breach, misuse or
fraud. Supplier shall pay all amounts due for any penalties or charges
(including amounts due to a third party as a result of Supplier's failure to
promptly notify PacifiCare pursuant to the preceding sentence), associated
taxes, legal expenses and other incidental expenses incurred by PacifiCare as a
result of Supplier's non-performance of its obligations under this Agreement
with respect to the PacifiCare Third Party Contracts. Any notice provided by
Supplier to PacifiCare pursuant to this Section 7.3 shall also be provided by
Supplier to the individual designated in Section 30.14 for such purpose.

8.       SERVICE LEVELS.

         8.1 BASE SERVICE LEVELS. During the Term and the Termination Assistance
Period, Supplier shall perform the Services in accordance with the applicable
Service Levels. The Base Service Levels shall be specified in Schedule 8, or,
for Base Service Levels not specified in Schedule 8 as of the Effective Date,
determined in accordance with the process in Schedule 8 for establishing Base
Service Levels.

         8.2 SERVICE LEVELS FOR NEW SERVICES. Supplier shall provide the New
Services in accordance with the Service Levels established by the Parties in
accordance with Section 5.1 and adjusted pursuant to Section 8.3 ("NEW SERVICES
SERVICE LEVELS").

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<PAGE>

         8.3 ADJUSTMENT OF SERVICE LEVELS. Without limitation of the automatic
adjustment process specified in Section I.N of Schedule 8, the Steering
Committee (a) shall review the Service Levels for the preceding twelve (12)
months during the last calendar quarter of every Contract Year, (b) with respect
to any Service Levels that require periodic adjustment pursuant to this
Agreement or are no longer appropriate because of an increase, decrease or
change to the Services, shall, as appropriate, increase or otherwise modify the
Service Levels for the subsequent Contract Year and (c) with respect to all
other Service Levels, may increase the Service Levels for the subsequent
Contract Year. In addition, either Party may, at any time upon notice to the
other Party, initiate negotiations to review and, upon agreement by the Steering
Committee, adjust any Service Level that such Party in good faith believes is
inappropriate at the time.

         8.4 ROOT-CAUSE ANALYSIS. With respect to Supplier's failure to provide
the Services in accordance with the applicable Service Levels, Supplier shall,
as soon as reasonably practicable, but not later than five (5) days after such
failure (except as provided below in this Section 8.4), (a) perform a root-cause
analysis to identify the cause of such failure, (b) provide PacifiCare with a
report detailing the cause of, and procedure for correcting, such failure, (c)
implement such corrective procedure, including obtaining PacifiCare's consent to
such implementation where such procedure has a material effect on the PacifiCare
Entities' receipt of the Services, and (d) provide PacifiCare with a written
action plan satisfactory to PacifiCare that specifies the steps Supplier has
taken, or shall take, to prevent such failures following the implementation of
the procedure. If Supplier, using all reasonable efforts, cannot complete its
obligations under clauses (a), (b), (c) or (d) above within the five (5)
day-period, Supplier shall, on a regular basis until such obligations are
completed, review with PacifiCare Supplier's progress in completing such
obligations (and provide written summaries thereof and a schedule for
completion). Supplier shall address and resolve any concerns raised by
PacifiCare in connection with such reviews.

         8.5 MEASUREMENT AND MONITORING TOOLS. As of the Effective Date,
Supplier shall implement the measurement and monitoring tools and procedures
required to measure and report (as contemplated by this Section 8.5 and Section
3.9) Supplier's performance of the Services against the applicable Service
Levels. Supplier may use the PacifiCare measurement and monitoring tools and
procedures existing as of the Effective Date for this purpose provided such
tools and procedures enable Supplier to measure and report Supplier's
performance as required by this Agreement. Such measurement, monitoring and
procedures shall (a) permit reporting at a level of detail sufficient to verify
compliance with the Service Levels and (b) be subject to audit by PacifiCare or
its designee pursuant to Section 19. Supplier shall provide PacifiCare and its
designees with information concerning access to such measurement and monitoring
tools and procedures upon request for inspection and verification purposes.

         8.6 CONTINUOUS IMPROVEMENT AND BEST PRACTICES. Supplier shall, on an
ongoing basis, (a) review the delivery of the Services and identify ways to
improve the Service Levels and (b) identify proven techniques and tools from
other installations within its operations that would benefit PacifiCare either
operationally or financially, and (c) implement such techniques and tools
provided that such implementation does not require a level of investment not
otherwise made or contemplated by Supplier in providing services to similarly
situated customers. Supplier shall, from time to time, include updates with
respect to such improvements, techniques

                                       13

<PAGE>

and tools in the reports provided to PacifiCare pursuant to Section 3.9 and
shall discuss its progress in identifying and applying such improvements,
techniques and tools in the knowledge sharing discussions with PacifiCare
pursuant to Section 3.6.

         8.7 SERVICE LEVEL CREDITS. In the event of a failure to provide the
Services in accordance with the applicable Service Levels, Supplier shall incur
the Service Level Credits identified in and according to Schedule 8. The Service
Level Credits shall not limit PacifiCare's right to recover, in accordance with
this Agreement, other damages incurred by PacifiCare as a result of such
failure. Where (a) Service Level Credits are incurred for failures of the
Service Levels specified in Schedule 8.7, (i) in [...***...] consecutive months
for the same such Service Level, or (ii) in [...***...] out of any twelVe (12)
months for the same such Service Level, PacifiCare may, upon notice to Supplier,
terminate this Agreement, in whole or in part, without regard to Section 24.3(a)
or Section 25; provided that PacifiCare notifies Supplier of PacifiCare's
election to terminate this Agreement pursuant to this Section 8.7 within thirty
(30) days after the earlier of 1) PacifiCare's determination that a termination
event described in this Section 8.7 has occurred and 2) PacifiCare's receipt of
notice from Supplier that such a termination event has occurred. Nothing in this
Section 8.7 shall be deemed to limit or obviate PacifiCare's right to terminate
this Agreement pursuant to Section 24.3(a). In addition to the foregoing, within
ten [...***...] days following the completion of root-cause analysis as required
in Section 8.4, at PacifiCare's option, following the incurrence of a Service
Level Credit, Supplier's Delivery Project Executive shall meet in person with
the PacifiCare Supplier Relationship Manager and other members of PacifiCare's
management at a time, date and location specified by PacifiCare to summarize and
present the results of the root-cause analysis required by Section 8.4 and
specify the steps Supplier has taken, or shall take, to prevent the further
incurrence of Service Level Credits, and, at PacifiCare's option, a Supplier
Senior Vice President shall be made available by phone at a reasonable time
specified by PacifiCare to discuss such results.

9.       PACIFICARE SATISFACTION AND BENCHMARKING.

         9.1 SATISFACTION SURVEY. Supplier shall conduct baseline and ongoing
customer satisfaction surveys.

         9.2 BENCHMARKING.

                  (a) BENCHMARKER. During the Term, to ensure that PacifiCare is
obtaining competitive pricing, PacifiCare may, at Supplier's and PacifiCare's
equally shared cost and expense, designate an independent third party (the
"BENCHMARKER") from among a list of mutually agreed prospective Benchmark
providers (as set forth in Schedule 9.2(a)) to measure Supplier's performance
and pricing under this Agreement in accordance with the Benchmark Process (each
a "BENCHMARK"). The Benchmarker shall use the Benchmark Process to measure
Supplier's performance and pricing [...***...].

                  (b) BENCHMARK PROCESS. PacifiCare may not require any
Benchmarks until [...***...] after the Effective Date, and thereafter may not
require a Benchmark [...***...] after the completion of such Benchmark. After
receiving the results of each Benchmark, PacifiCare shall share the

                                              * CONFIDENTIAL TREATMENT REQUESTED

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results of such Benchmark with Supplier and, within thirty (30) days of
PacifiCare's sharing such results, the Parties shall complete their review of
such results.

                  (c) BENCHMARK RESULTS. With respect to undisputed Benchmark
results, if the applicable Fees are (i) within [...***...]% of the Benchmark
results, the Fees shall not be adjusted; (ii) if the applicable Fees are between
[...***...]% and [...***...]% higher than the Benchmark results, then the
applicable Fees shall be adjusted automatically [...***...] to be within
[...***...]% of the Benchmark results; or (iii) if the applicable Fees are more
than [...***...]% higher than the Benchmark results, then the applicable Fees
shall be reduced automatically (on a Tower-by-Tower basis) by [...***...]%, and
the Parties shall promptly discuss any further Fee or other adjustments. If,
after completing their reviews of the Benchmark results, the Parties are unable
to resolve any issue regarding such results, including Fee or other adjustments
related to such results, within thirty (30) days after either Party determines
that the Parties are unable to resolve such issue, [...***...].

10.      SERVICE LOCATIONS.

         10.1 SERVICE LOCATIONS. The Services shall be provided to the
PacifiCare Entities from (a) the PacifiCare Service Locations, (b) the Supplier
Service Locations and (c) any other location for which Supplier has received
PacifiCare's consent, to be given in PacifiCare's sole discretion. Any
incremental expenses incurred by PacifiCare as a result of a relocation to, or
use of, any location other than the locations set forth in Schedule 10.1 shall,
at PacifiCare's sole discretion, be paid by Supplier or reimbursed to PacifiCare
by Supplier, unless the provision of Services at such other location has been
requested or otherwise directed by PacifiCare. Supplier and Supplier Agents may
not provide or market services to a third party from a PacifiCare Service
Location without PacifiCare's consent, to be given in PacifiCare's sole
discretion.

         10.2 SAFETY AND SECURITY PROCEDURES. Supplier shall maintain and
enforce at the Supplier Service Locations safety and security procedures that
are at least equal to the most stringent of the following: (a) standard Supplier
internal security and safety procedures for Supplier's service locations similar
to the Supplier Service Locations, (b) the standards set forth in Schedule 10.2,
and (c) any higher standard otherwise agreed upon by the Parties. With respect
to PacifiCare Service Locations, Supplier shall comply with the PacifiCare
procedures applicable to such locations, including the safety and security
procedures set forth in Schedule 10.2. Supplier shall, [...***...], provide to
PacifiCare the results of an annual SAS 70 security audit, or an equivalent
audit approved by PacifiCare, of the Service Locations.

         10.3 DATA SECURITY. Supplier shall (a) establish and maintain
environmental, security, and other safeguards against the destruction, loss or
alteration of PacifiCare Data in the possession of Supplier and during the
electronic transmission, storage and shipping thereof (the "DATA SAFEGUARDS")
that shall comply with and be no less rigorous than (i) those data security
policies in effect as of the Effective Date at each applicable PacifiCare
Service Location in respect of such PacifiCare Service Location and Supplier
Service Location, and (ii) as may be required by Supplier Laws and other Laws
identified to Supplier by PacifiCare from time to time in accordance with
Section 3.3(b), and (b) provide dedicated storage devices for PacifiCare Data
secured against any shared access with the data of any Supplier's data or Data
of Supplier's

                                              * CONFIDENTIAL TREATMENT REQUESTED

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<PAGE>

other customers. Supplier shall revise and maintain the Data Safeguards
[...***...]. In the event Supplier intends to implement a change to the Data
Safeguards (including pursuant to PacifiCare's request), Supplier shall notify
PacifiCare and, upon PacifiCare's consent, implement such change.

         10.4 DATA SECURITY BREACHES. In the event Supplier or Supplier Agents
discover or are notified of a breach of security, or a potential breach of
security that could have a material adverse effect on PacifiCare or any other
PacifiCare Entity, relating to PacifiCare Data, Supplier shall immediately
notify the PacifiCare Supplier Relationship Manager and the PacifiCare Director
of Information Security of such breach or potential breach. Supplier shall
provide PacifiCare with a written action plan satisfactory to PacifiCare that
specifies, with respect to actual security breaches, the steps Supplier has
taken or shall take to prevent such actual breaches from recurring, and, with
respect to potential breaches, the steps Supplier has taken or shall take to
prevent such breaches from occurring. With respect to actual breaches of
security, if the PacifiCare Data subject to such breach was in the possession of
Supplier or Supplier Agents at the time of such breach, Supplier shall promptly
investigate [...***...] the effects of such breach. To the extent any actual
breach is attributable to Supplier or Supplier Agents, including Supplier's
failure to perform its obligations pursuant to this Section 10 or Exhibit B
(Statement of Work), [...***...]. In addition, Supplier shall review the Data
Safeguards on a regular basis and notify PacifiCare of security concerns of
which Supplier becomes aware that may have a material adverse effect on
PacifiCare or any other PacifiCare Entity, and Supplier shall thereafter provide
PacifiCare with a written action plan satisfactory to PacifiCare that addresses
such security concerns.

         10.5 SECURITY RELATING TO COMPETITORS. Prior to the Cutover Date, the
Parties shall agree on procedures that Supplier will implement at Supplier
Service Locations if: (a) Supplier intends to provide the Services from a
Service Location that is shared with a third party or third parties; or (b) any
part of the business of Supplier or any such third party is now or in the future
competitive with the PacifiCare Entities' business. Such procedures shall, at a
minimum, restrict access in any such shared environment to PacifiCare's
Confidential Information so that Supplier's employees or Supplier Agents
providing services to such third parties do not have access to PacifiCare
Confidential Information.

11.      HUMAN RESOURCES. Supplier shall offer employment to the Affected
Employees, and the transitioning to Supplier of such Affected Employees who
accept such offers (the "TRANSITIONED PERSONNEL") shall be effected in
accordance with the terms and conditions set forth in Schedule 11.

12.      SUPPLIER STAFF.

         12.1 SUPPLIER CLIENT RELATIONSHIP MANAGER. Supplier shall appoint an
individual (the "SUPPLIER CLIENT RELATIONSHIP MANAGER") who from the Effective
Date shall serve, on a full-time basis, as the primary Supplier representative
under this Agreement. Supplier's appointment of any Supplier Client Relationship
Manager shall be subject to PacifiCare's prior consent. The Supplier Client
Relationship Manager shall (a) have overall responsibility for managing and
coordinating the performance of Supplier's obligations under this Agreement and
(b) be

                                              * CONFIDENTIAL TREATMENT REQUESTED

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authorized to act for and on behalf of Supplier with respect to all matters
relating to this Agreement.

         12.2 KEY PERSONNEL. With respect to Key Personnel set forth in Schedule
12.2, except as otherwise agreed by PacifiCare, the Parties agree as follows:

                  (a) The Key Personnel shall be dedicated to the PacifiCare
account on a full-time basis.

                  (b) Before assigning an individual to a Key Personnel
position, whether as an initial assignment or as replacement, Supplier shall (i)
notify PacifiCare of the proposed assignment, (ii) introduce the individual to
appropriate representatives of the PacifiCare Entities, (iii) subject to
applicable Law, provide PacifiCare with any information regarding the individual
that may be reasonably requested by PacifiCare and (iv) obtain PacifiCare's
consent for such assignment. Supplier shall only assign an individual to a Key
Personnel position who is approved by PacifiCare.

                  (c) Supplier shall not replace or reassign an individual
designated as Key Personnel for [...***...] from the date on which such
individual is designated as Key Personnel, unless PacifiCare in its sole
discretion consents to such reassignment or replacement of individual, or such
individual (1) voluntarily resigns from Supplier, (2) is dismissed by Supplier
for misconduct, (3) fails to perform his or her duties and responsibilities, or
(4) dies or is otherwise unable to work due to his or her disability.

                  (d) If PacifiCare in good faith decides that any Key Personnel
should not continue in that position, then PacifiCare may, in its sole
discretion and upon notice to Supplier, require immediate removal of such Key
Personnel from the Project Staff. Supplier shall, as soon as reasonably
practicable, replace such Key Personnel in accordance with this Section 12.2.

                  (e) Supplier shall maintain backup procedures and conduct the
replacement procedures for any Key Personnel in such a manner so as to provide
for an orderly succession for Key Personnel who are replaced.

         12.3 PROJECT STAFF. Supplier shall appoint to the Project Staff
individuals with suitable training and skills to perform the Services, as
applicable. Supplier shall provide PacifiCare with a list of all Supplier
personnel dedicated full-time to the Project Staff at the end of every 90-day
period after the Effective Date. Except as otherwise approved by PacifiCare (in
its sole discretion), those Supplier personnel located on PacifiCare's premises
may only provide services on such premises that support PacifiCare's operations.
Supplier shall notify PacifiCare as soon as practicable after dismissing or
reassigning any member of the Project Staff whose normal work location is at a
PacifiCare Service Location.

         12.4 SUBCONTRACTORS.

                  (a) Except with respect to those subcontractors set forth in
Schedule 12.4, prior to subcontracting the Services or any portion thereof,
Supplier shall: (i) notify PacifiCare of the proposed subcontract; (ii) provide
the name of the proposed subcontractor, a description of the work to be
subcontracted, an explanation of why that work is to be subcontracted and

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       17
<PAGE>

descriptive information about each subcontractor's ability to perform the work;
(iii) obtain PacifiCare's consent to such subcontract. the PacifiCare Entities
shall not be bound by the provisions of any agreements entered into between
Supplier and its subcontractors. Except with respect to those subcontractors set
forth in Schedule 12.4, prior to amending, modifying or otherwise supplementing
any subcontract relating to the Services in a manner that materially affects the
scope or nature of the services provided by a subcontractor, Supplier shall
notify PacifiCare of the proposed amendment, modification or supplement and
shall obtain PacifiCare's consent thereto.

                  (b) No subcontracting shall release Supplier from its
responsibility for its obligations under this Agreement. Supplier shall be
responsible for the work and activities of each of its subcontractors, including
compliance with the terms of this Agreement.

                  (c) Supplier shall be responsible for all payments to its
subcontractors. Supplier shall promptly pay for all services, materials,
equipment and labor used in providing the Services and Supplier shall keep the
PacifiCare Entities' premises free of all liens related thereto.

                  (d) Those subcontractors who, as of the Effective Date, have
been pre-approved by PacifiCare are set forth in Schedule 12.4.

                  (e) For Non-Critical Services (defined below) for which
Supplier wishes to engage subcontractors, Supplier may comply with Section
12.4(a) by providing PacifiCare with notice as soon as practicable after
engaging such subcontractor, provided that all other provisions of this Section
12.4 shall apply. For purposes of this Section 12.4, "NON-CRITICAL SERVICES"
means services performed by a subcontractor that do not require interaction
between the PacifiCare Entities and such subcontractor (including its
employees), that are administrative in nature, and that are performed outside of
the PacifiCare Service Locations. Non-Critical Services include, for example,
memory tape replacement activities.

                  (f) If PacifiCare in good faith objects to the continued use
of a subcontractor, or the scope of the duties of a particular subcontractor,
even if such subcontractor has been previously approved pursuant to Section
12.4(a), is a provider of Non-Critical Services, or is listed on Schedule 12.4,
upon notice from PacifiCare of such objection containing reasonable details
concerning the basis of such objection, Supplier shall attempt to resolve such
objections as soon as possible. If the Parties have not resolved such objections
within [...***...] of PacifiCare's notice of its objection, Supplier shall cause
such subcontractor to cease providing Services to PacifiCare and shall replace
such subcontractor with another subcontractor acceptable to PacifiCare.

         12.5 CONDUCT OF SUPPLIER PERSONNEL. While at the PacifiCare Service
Locations, Supplier and Supplier Agents agree at all times to, and shall cause
the Project Staff to, (a) comply with the requests, standard rules and
regulations of PacifiCare regarding safety and health, personal and professional
conduct (including adhering to general safety practices and procedures)
generally applicable to such PacifiCare Service Locations, (b) otherwise conduct
themselves in a businesslike manner and (c) maintain and enforce Section 20 of
this Agreement. If PacifiCare notifies Supplier that a particular member of the
Project Staff is not conducting himself or herself in accordance with this
Section 12.5, Supplier shall promptly: (y) investigate

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       18
<PAGE>

the matter and take appropriate action that may include (i) removing the
applicable person from the Project Staff, (ii) providing PacifiCare with prompt
notice of such removal and (iii) replacing the applicable person with a
similarly qualified individual; or (z) take other appropriate disciplinary
action to prevent a recurrence. In the event of multiple violations of this
Section 12.5 by a particular member of the Project Staff, Supplier shall
promptly remove the individual from the Project Staff.

         12.6 NON-COMPETITION. Supplier shall not assign any Key Personnel to
the account of any competitor of the PacifiCare Entities without PacifiCare's
prior consent for [...***...] following the date such KEY Personnel ceases to
provide Services to PacifiCare pursuant to this Agreement.

13.      MANAGEMENT AND CONTROL.

         13.1 STEERING COMMITTEE. Prior to the Cutover Date, the PacifiCare
Supplier Relationship Manager and the Supplier Client Relationship Manager shall
determine the composition of a steering committee and each shall appoint an
equal number of representatives to serve on such committee (the "STEERING
COMMITTEE"). PacifiCare shall designate one of its representatives on the
Steering Committee to act as the chairperson of the Steering Committee. The
Steering Committee shall be authorized and responsible for (a) advising with
respect to PacifiCare's tactical and strategic decisions regarding the
establishment, budgeting and implementation of PacifiCare's priorities and plans
for the Services and (b) monitoring and, without limitation of the dispute
resolution procedures set forth in Section 23, resolving disagreements regarding
the provision of the Services and the Service Levels. A Party may change any of
its representatives on the Steering Committee upon notice to the other Party;
provided that such change may be effected without causing any delays in the
dispute resolution procedures set forth in Section 23.

         13.2 OVERSIGHT AND MANAGEMENT PROCESS; RELATIONSHIP WITH KEANE.
Supplier shall perform the Services and manage its relationship with Keane, Inc.
("KEANE") in accordance with this Section 13.2, the Operational Agreement, and
the Oversight and Management Process set forth in Schedule 13.2 ("OVERSIGHT AND
MANAGEMENT PROCESS").

                  (a) RELATIONSHIP WITH KEANE; OPERATIONAL AGREEMENT. Supplier
and Keane shall cooperate and interact with each other to the extent necessary
for the PacifiCare Entities to receive the Services and the Keane Services in
accordance with the terms and conditions of this Agreement and the Keane
Agreement, respectively. PacifiCare shall, as PacifiCare deems appropriate,
control and be the primary interface for the PacifiCare Entities with Supplier,
Keane and third parties. Supplier shall work closely with Keane to deliver the
Services and the Keane Services in a seamless manner through an integrated
service delivery team, as described in the Oversight and Management Process,
including, for example, the utilization of integrated tools, processes and
methodologies, where applicable. In furtherance of the foregoing, as of the
Effective Date, Supplier and Keane shall execute and deliver an agreement,
acceptable in form and substance to PacifiCare (the "OPERATIONAL AGREEMENT"),
which shall include, among other things, provisions that address the following
items:

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       19
<PAGE>

                           (i) Supplier and Keane shall establish an integrated
Program Office (the "PROGRAM OFFICE") and procedures (e.g., the customer
satisfaction methodology described on Schedule 13.2) acceptable to PacifiCare
for use by Keane and Supplier to (1) permit Supplier to provide the Services and
Keane to provide the Keane Services to PacifiCare in a seamless manner, (2)
promptly investigate and resolve any performance failures that occur, and (3)
determine the accountability as between Supplier and Keane for such failures.
The initial Program Office shall consist of the individuals and positions set
forth in Schedule 13.2. Members of the Program Office shall be deemed to be Key
Personnel.

                           (ii) With respect to Keane's failure to provide the
Keane Services in accordance with applicable service levels, Supplier shall
cause Keane to perform a root cause analysis in accordance with Section 8.4 of
the Keane Agreement, to implement corrective procedures in accordance with the
Keane Agreement, and to provide PacifiCare with the applicable reports and
action plans as required by Section 8.4 of the Keane Agreement. With respect to
1) actions by Supplier that cause a service level failure by Keane, 2) actions
by Keane that cause a service level failure by Supplier, or 3) service level
failures attributable to both Supplier and Keane or for which the cause is not
clear, Supplier will coordinate with Keane to perform a joint root cause
analysis and provide to PacifiCare the reports and action plans specified in
Section 8.4 of this Agreement. Supplier shall implement measurement and
monitoring tools and procedures that permit integrated reporting of compliance
with applicable service levels, and the incurrence of service level credits,
with respect to the Services and the Keane Services. In the event that service
level failures by Supplier or Keane result in the incurrence of a service level
credit (as provided in Section 8.8 of this Agreement or in Section 8.8 of the
Keane Agreement, as applicable), service level credits shall be apportioned
among, or incurred by each of, Supplier and Keane, in accordance with the
Operational Agreement.

                           (iii) Supplier and Keane shall establish efficient
means of communication between Supplier, Keane and PacifiCare, including through
a governance structure incorporating executive and operational committees
described on Schedule 13.2, such that both routine operational information and
information relating to any issues or problems with, or any interruptions (other
than in connection with scheduled downtime set forth Schedule 8) or degradations
to, the Services and any other Supplier or Keane obligations to PacifiCare flow
between Supplier, Keane and PacifiCare without material delay and without
requiring coordination by, or intervention of, PacifiCare, except as PacifiCare
otherwise requires.

                           (iv) Supplier and Keane, working with PacifiCare to
the extent PacifiCare deems appropriate, shall in good faith attempt to resolve
all disputes between Supplier and Keane relating to the provision of the
Services, the Keane Services, or any other Supplier or Keane obligations to
PacifiCare, as soon as possible and without involving PacifiCare; provided that
in the event that Supplier and Keane do not resolve such disputes themselves,
Supplier and Keane may jointly request that PacifiCare, at no cost or expense to
PacifiCare, resolve such dispute and, if so requested, such resolution shall be
final and binding on Supplier and Keane.

                           (v) Supplier and Keane shall provide for the
integration of tools, processes and methodologies where applicable in accordance
with the Operational Agreement.

                                       20
<PAGE>

                           (vi) Supplier and Keane shall provide for any other
provisions necessary for Supplier and Keane to provide PacifiCare with the
Services (including the Termination Assistance Services) and the Keane Services
in a seamless manner.

Supplier shall not modify or amend the Operational Agreement in a manner that
would have a material adverse effect on PacifiCare, the provision of the
Services, the provision of the Keane Services or PacifiCare's ability to enforce
its rights and remedies under this Agreement, without PacifiCare's prior
consent.

                  (b) [...***...].

         13.3 POLICY & PROCEDURES MANUAL. An initial outline of a management
Policy & Procedures Manual for the Services is set forth in Schedule 13.3.
Within [...***...] after the Effective Date, Supplier shall deliver to
PacifiCare, for PacifiCare's review, comment and consent, a management Policy &
Procedures Manual based on the outline set forth in Schedule 13.3 that shall
include, among other things, annual and quarterly objectives, annual plan and
performance goals (the "POLICY & PROCEDURES MANUAL"). Supplier shall
periodically prepare and provide to PacifiCare, for PacifiCare's review, comment
and consent, updates to such Policy & Procedures Manual to reflect any changes
in the procedures described therein as soon as practicable after such changes
are made at PacifiCare's request or with PacifiCare's consent.

         13.4 CHANGE CONTROL PROCEDURES. Supplier shall deliver to PacifiCare,
for its review, comment and consent, the Change Control Procedures. The Change
Control Procedures shall provide, at a minimum, that:

                  (a) no Change shall be implemented without PacifiCare's
consent (which may be given in a mutually e-mailed or other electronic format),
except as may be necessary on a temporary basis to maintain the continuity of
the Services, and any projected adverse effect of any Change with respect to the
Services, Service Levels or Fees shall be a reasonable basis for disapproval of
such proposed Change;

                                               *CONFIDENTIAL TREATMENT REQUESTED
                                       21

<PAGE>

                  (b) with respect to all Changes, Supplier shall (i) schedule
Changes, other than those Changes made on a temporary basis, to maintain the
continuity of the Services so as not to unreasonably interrupt the PacifiCare
Entities' business operations, (ii) prepare and deliver to PacifiCare each month
a rolling schedule for ongoing and planned Changes for the next twelve (12)
month period and (iii) monitor the status of Changes against the applicable
schedule; and

                  (c) with respect to any Change made on a temporary basis to
maintain the continuity of the Services, Supplier shall document and provide to
PacifiCare notification of the Change no later than the next business day after
the Change is made.

                  Supplier shall update the Change Control Procedures as
necessary and shall provide such updated Change Control Procedures to PacifiCare
for its consent.

14.      PROPRIETARY RIGHTS.

         14.1 BACKGROUND TECHNOLOGY. Supplier shall have and retain exclusive
ownership of all of Supplier's Background Technology and intellectual property
rights therein. Prior to including any Supplier Background Technology in any
Work Product that Supplier shall use or deliver to any PacifiCare Entities in
connection with the Services, Supplier must set forth in writing such Background
Technology to be included and obtain PacifiCare's consent. Each Party shall have
and retain exclusive ownership of all of its Background Technology and
intellectual property rights therein. All rights not expressly granted herein
with respect to Background Technology are reserved to the owner thereof.

         14.2 PACIFICARE SOFTWARE. Subject to the terms and conditions of this
Agreement, PacifiCare hereby grants to Supplier, during the Term and the
Termination Assistance Period, solely to provide the Services to the PacifiCare
Entities, a global, fully-paid, royalty-free, non-exclusive, non-transferable
license to (a) use the PacifiCare Proprietary Software (and Related
Documentation in PacifiCare's possession), and (b) use, to the extent
permissible under the applicable third party agreements, the PacifiCare Third
Party Software. Supplier may sublicense, to the extent permissible under any
applicable third party agreements, to Supplier Agents the right to use the
PacifiCare Software solely to provide those Services that such Supplier Agents
are responsible for providing. As between the Parties, PacifiCare shall retain
all rights of ownership in the PacifiCare Software. All rights not expressly
granted to Supplier in this Agreement with respect to the PacifiCare Software
are reserved to PacifiCare.

         14.3 SUPPLIER SOFTWARE. Supplier shall obtain PacifiCare's consent
prior to using any Supplier Software (and any of Supplier's Background
Technology included in the Supplier Software) to provide the Services. A current
list of Supplier Software is attached hereto as Schedule 14.3. Subject to the
terms and conditions of this Agreement, Supplier hereby grants to PacifiCare a
global, fully-paid, royalty-free, non-exclusive, non-transferable license to
use, and to sublicense and to permit third parties to use, during the Term and
Termination Assistance Period, solely in connection with the receipt or use of
the Services, (a) the Supplier Proprietary Software (and any of Supplier's
Background Technology included in the Supplier Software) and (b) to the extent
permissible under the applicable third party agreements, the Supplier Third
Party Software. Upon PacifiCare's request, Supplier shall provide PacifiCare
with a list of all

                                       22
<PAGE>

Supplier Software being used to provide the Services as of the date of such
request. As between the Parties, Supplier shall retain all rights of ownership
in the Supplier Software. All rights not expressly granted to the PacifiCare
Entities in this Agreement with respect to the Supplier Software are reserved to
Supplier.

         14.4 SUPPLIER TOOLS. Supplier shall obtain PacifiCare's consent prior
to using any Supplier Tools (and any of Supplier's Background Technology
included in such Tools) to provide the Services. Subject to the terms and
conditions of this Agreement, Supplier hereby grants to the PacifiCare Entities
a global, fully-paid, royalty free, non-exclusive, non-transferable license to
use, and to sublicense and to permit a third party to use, during the Term and
Termination Assistance Period, solely in connection with the receipt or use of
the Services, the Supplier Tools (and any of Supplier's Background Technology
included in such Tools) used to provide the Services. All rights not expressly
granted to the PacifiCare Entities in this Agreement with respect to the
Supplier Tools are reserved to Supplier.

         14.5 WORK PRODUCT. PacifiCare shall own all right, title and interest
in and to the Work Product and all copies thereof.

         14.6 POLICIES AND PROCEDURES MANUAL. Supplier shall own the Policy and
Procedures Manual. Supplier hereby grants to PacifiCare a global, fully paid-up,
royalty free, non-exclusive, non-transferable, perpetual and irrevocable license
to use, reproduce and create derivative works of the Policies and Procedures
Manual, and to sublicense the same rights to third parties solely in connection
with such third parties' provision of services similar to the Services to
PacifiCare Entities. All rights not expressly granted to PacifiCare Entities in
this Agreement with respect to the Policy and Procedures Manual are reserved to
Supplier. Notwithstanding the foregoing, Supplier shall not use or disclose to
third parties any documentation, materials or other information provided by the
PacifiCare Entities to Supplier for use in the Policy and Procedures Manual in
any manner that could identify a PacifiCare Entity as the source of such
documentation, material or information.

         14.7 UPGRADES TO SOFTWARE; REFRESH OF SUPPLIER EQUIPMENT. Supplier
shall upgrade Software and refresh the Supplier Equipment in accordance with
Exhibit B (Statement of Work).

15.      DATA.

         15.1 OWNERSHIP OF PACIFICARE DATA. All PacifiCare Data is, or shall be,
and shall remain the property of PacifiCare. Supplier hereby irrevocably
assigns, transfers and conveys, and shall cause Supplier Agents to assign,
transfer and convey, to PacifiCare without further consideration all of its and
their right, title and interest in and to PacifiCare Data.

         15.2 USE OF PACIFICARE DATA. Without PacifiCare's consent (subject to
PacifiCare's sole discretion) or as otherwise directed by PacifiCare, PacifiCare
Data shall not be (a) used, disclosed, monitored, analyzed, individualized,
anonymized, aggregated, stored, copied, or otherwise provided to third parties
by Supplier or Supplier Agents, (b) sold, assigned, or leased by Supplier or
Supplier Agents, or (c) commercially exploited in any form (including any
individualized, anonymized or aggregated form) by or on behalf of Supplier or
Supplier Agents.

                                       23
<PAGE>

Supplier shall at all times comply with all PacifiCare data retention, use and
privacy standards and all Laws relating to Supplier's access to PacifiCare Data.

         15.3 CORRECTION AND RECONSTRUCTION.

                  (a) Supplier shall, [...***...] promptly correct any errors or
inaccuracies in the reports delivered to PacifiCare under this Agreement that
are attributable to Supplier or Supplier Agents.

                  (b) Supplier shall develop and maintain procedures regarding
the storage (including regular back up) and restoration of PacifiCare Data.
Supplier shall, [...***...] recover any lost PacifiCare Data in The event that
such losses are attributable to Supplier's failure to perform its obligations
under this Agreement, provided that PacifiCare provides Supplier with reasonable
assistance in recovering such lost data. For losses of PacifiCare Data that are
not attributable to Supplier as specified in the preceding sentence, Supplier
shall restore such losses by using the most recent back up of the lost
PacifiCare Data, including any related computer journals, in accordance with
this Agreement.

         15.4 RETURN OF DATA. Upon request by PacifiCare at any time during the
Term and upon expiration or termination of this Agreement, or at any time when
Supplier no longer requires any portion of the PacifiCare Data to provide the
Services, Supplier shall (a) promptly return to PacifiCare, in the format and on
the media on which it exists, all PacifiCare Data (or such portion as requested
by PacifiCare or that is no longer necessary to provide the Services) and (b)
erase or destroy all PacifiCare Data (or such portion of PacifiCare Data as
requested by PacifiCare or that is no longer necessary to provide the Services)
in Supplier's possession. Supplier and Supplier Agents shall use any archival
tapes containing PacifiCare Data solely for back-up purposes and shall maintain
such back-up copies of PacifiCare Data as Confidential Information of
PacifiCare. [...***...].

16.      CONTINUED PROVISION OF SERVICES.

         16.1 DISASTER RECOVERY PLAN. PacifiCare's current disaster recovery
plans (collectively, the "DRP") are set forth in Schedule 16.1, which DRP shall
be effective under this Agreement until PacifiCare approves of any successor DRP
to be developed pursuant to this Section 16.1. Promptly following the Effective
Date, Supplier shall: (a) evaluate PacifiCare's current DRP and submit
recommended DRP improvements for PacifiCare's review and approval and, if
PacifiCare approves of the DRP improvements, implement a revised DRP acceptable
to PacifiCare [...***...], or within another time period agreed to by the
Parties; (b) update and test the operability of the DRP [...***...] during the
Term; and, (c) during the period in which Supplier will provide disaster
recovery services in lieu of the services that are provided under [...***...]
certify in writing to PacifiCare [...***...] during the Term that the DRP is in
place and executable in accordance with its terms. Supplier shall immediately
notify PacifiCare of the occurrence of events that Supplier becomes aware of
that could reasonably be considered a disaster (as defined in the DRP) and
implement the DRP upon the declaration of a disaster by PacifiCare in

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                       24
<PAGE>

accordance with the DRP. Without limiting Supplier's other obligations under
this Agreement, including the Service Levels, in the event of an interruption in
services described as "critical" in Schedule 16.1 ("CRITICAL SERVICES"),
Supplier shall use all reasonable efforts to reinstate the Critical Services as
promptly as possible, but in any event within the number of hours identified in
Schedule 16.1 with respect to each of the Critical Services. In the event of a
disaster (as such term is defined in the DRP), PacifiCare shall continue to pay
the then-current Base Fees, and Supplier shall not increase its Fees under this
Agreement or charge PacifiCare usage or other incremental fees in addition to
the Base Fees or the Variable Fees.

         16.2 FORCE MAJEURE. If and to the extent that a Party's performance of
any of its obligations pursuant to this Agreement is prevented, hindered or
delayed by fire, flood, earthquake, elements of nature or acts of God, acts of
war, terrorism, riots, civil disorders, rebellions or revolutions, or any other
similar cause beyond the reasonable control of such Party (but specifically
excluding [...***...] (each, a "FORCE MAJEURE EVENT"), and such non-performance,
hindrance or delay could not have been prevented by reasonable precautions, then
the non-performing, hindered or delayed Party shall be excused for such
non-performance, hindrance or delay, as applicable, of those obligations
affected by the Force Majeure Event for as long as such Force Majeure Event
continues and such Party continues to use all reasonable efforts to recommence
performance whenever and to whatever extent possible without delay, including
through the use of alternate sources, workaround plans or other means. The Party
whose performance is prevented, hindered or delayed by a Force Majeure Event
shall immediately notify the other Party of the occurrence of the Force Majeure
Event and describe in reasonable detail the nature of the Force Majeure Event.
The occurrence of a Force Majeure Event does not excuse, limit or otherwise
affect Supplier's obligation to provide either normal recovery procedures or any
other disaster recovery services described in Section 16.1.

         16.3 ALTERNATE SOURCE. If any Force Majeure Event or any Precluded
Performance Event prevents, hinders or delays performance of any Services, for
the time identified on Schedule 16.1 in the case of any Critical Service, or for
more than [...***...] in the case of all other Services, Supplier shall,
[...***...] arrange for an alternate source to provide the affected Services to
the PacifiCare Entities. If the Force Majeure Event or Precluded Performance
Event continues to prevent, hinder or delay performance of the Services, for
more than [...***...] in the case of Critical Services, or more than [...***...]
in The case of all other Services, PacifiCare may terminate this Agreement, in
whole or in part (in the case of partial termination, only the portion of this
Agreement affected by the Force Majeure Event or Precluded Performance Event,
unless such event affects a substantial portion of this Agreement), as of a date
specified by PacifiCare in a termination notice to Supplier, without regard to
Section 24.3(a), and shall pay applicable Wind Down Costs, if any.

         16.4 ALLOCATION OF RESOURCES. Whenever a Force Majeure Event or a
disaster causes Supplier to allocate limited resources between or among
Supplier's customers, Supplier shall not provide to any other customers of
Supplier priority over PacifiCare. In addition, in no event shall Supplier
re-deploy or reassign any Key Personnel to another account in the event of a
Force Majeure Event. If a Force Majeure Event affects another Supplier customer
and does not affect PacifiCare, Supplier may request that PacifiCare allow
Supplier, subject to Supplier's obligations to perform the Services in
accordance with the applicable Service Levels, to allocate certain Key

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                       25
<PAGE>

Personnel to such other customer temporarily. PacifiCare shall consider such
request in good faith and determine, in its sole discretion, whether to permit
such reallocation.

17.      PAYMENTS AND INVOICING.

         17.1 BASE FEES. In consideration of Supplier providing the Base
Services, and in accordance with Section 17.2, PacifiCare shall pay to Supplier
the Base Fees as such fees are specified in Schedule 17. Except as expressly set
forth in this Agreement, there shall be no charge or fees payable by PacifiCare
in respect of Supplier's performance of its obligations pursuant to this
Agreement.

         17.2 BASE FEES. On or before the tenth (10th) day of each month,
Supplier shall provide PacifiCare with an invoice for the Fees associated with
the Base Services performed during such month, including, after the first month
of the Term, adjustments to such Fees based on the Variable Fee Report that
accompanies such invoice. The Base Fees for each month in which PacifiCare
receives such invoice in accordance with the preceding sentence shall be due and
payable to Supplier on the last day of the month in which Supplier received the
invoice. Invoices received after the tenth (10th) day of the month will be paid
within thirty (30) days after PacifiCare's receipt of such invoices.

         17.3 VARIABLE FEES AND BASELINE ADJUSTMENTS. At the end of every month,
Supplier shall review the amount of the Base Services used by PacifiCare during
the preceding month. In the event PacifiCare's use of such services (a)
increases above the resource baselines set forth in Schedule 17, PacifiCare
shall pay to Supplier, in addition to the Base Fees, an amount equal to the
Additional Resource Charges in connection with the services as set forth in
Schedule 17 or (b) decreases below the resource baselines set forth in Schedule
17, Supplier shall credit PacifiCare an amount equal to Reduced Resource Credits
in connection with the services as set forth in Schedule 17. All such payments
and credits shall be made in accordance with Section 17.4. Upon notice to
Supplier, and no more than once each Contract Year, PacifiCare may adjust the
resource baselines set forth in Schedule 17 and PacifiCare and Supplier shall
implement an appropriate adjustment to the Fees to reflect the adjustment of the
resource baselines.

         17.4 VARIABLE FEE REPORT. Beginning after the first month of the Term,
Supplier shall provide PacifiCare with the Variable Fee Report at the same time
Supplier provides the invoice for the Base Fees as specified Section 17.2. In
the event the Reduced Resource Credits specified in such report are in excess of
the Additional Resource Charges specified in such report, Supplier shall provide
PacifiCare with a credit in the amount of such excess on the invoice for the
Base Fees for that month. In the event the Additional Resource Charges specified
in such report are in excess of the Reduced Resource Credits specified in such
report, Supplier shall increase the amount owed under the Base Fee invoice for
that month in the amount of such excess. In the event PacifiCare disapproves of
any of the Variable Fees set forth in the Variable Fee Report, PacifiCare shall
provide Supplier with a list of any Variable Fees of which PacifiCare
disapproves and Supplier shall adjust the Variable Fee Report to reflect the
changes indicated by PacifiCare and agreed to by Supplier.

                                       26
<PAGE>

         17.5 TIME OF PAYMENT. Any sum due Supplier pursuant to this Agreement
for which payment is not otherwise specified shall be due and payable
[...***...] after receipt by PacifiCare of an invoice from Supplier. If any
payments or portion thereof are not received by Supplier within [...***...]
after the dAte by payment is due, PacifiCare shall pay Supplier interest on such
overdue amount equal to the lesser of (i) [...***...], and (ii) the maximum
amount permissible by applicable Law ("LATE PAYMENT INTEREST"), as follows: if
the payment is received between [...***...] after the due date, PacifiCare shall
pay an amounT equal to the Late Payment Interest calculated on the entire first
[...***...] of the month; if the paymenT is received between [...***...] after
the due date and the end of that month, PacifiCare shall pay an amoUnt equal to
the Late Payment Interest calculated on the entire number of days in that month.
Payments received more than [...***...] after the due date will be subject to
the same semi-monthly calculation foR each month such payments are overdue after
the first month. Payments disputed in accordance with Section 17.7 are not
subject to this Section 17.5.

         17.6 DETAILED INVOICES. Supplier shall provide detailed invoices as
agreed by PacifiCare and Supplier pursuant to Schedule 17.

         17.7 FEE DISPUTE. PacifiCare may withhold invoiced amounts that
PacifiCare disputes in good faith up to an amount equal to [...***...]. Disputed
amounts in excess of [...***...] shall be deposited in an interest-bearing
escrow account under the custody and control of a federally chartered bank until
the Dispute is finally resolved, at which time the escrowed amounts and interest
shall be promptly paid to the Party entitled thereto. PacifiCare shall pay
disputed amounts in excess of [...***...] to Supplier under protest and in
accordance with Section 17.5. The payment by either Party of any disputed
amounts shall not constitute a waiver of such Party's rights under this
Agreement or applicable Law. The Parties shall diligently pursue resolution of
any fee Dispute in accordance with Section 23. PacifiCare shall notify Supplier
of all such Disputes in writing and shall provide in reasonable detail an
explanation of the facts underlying the Dispute. PacifiCare shall pay the amount
of any invoice not in dispute in accordance with the terms of this Agreement.

         17.8 SUBSTANTIAL CHANGE IN BASELINES. In the event that PacifiCare's
use of the Base Services with respect to a then-current baseline described in
Schedule 17 decreases by more than [...***...] percent ([...***...]%) (other
than decreases attributable to PacifiCare's exercise of its rights under Section
3.10) for any consecutive ninety (90)-day period during the Term, PacifiCare and
Supplier shall negotiate and implement an appropriate adjustment to the
applicable Fees. In the event that PacifiCare's use of the Base Services with
respect to a then-current baseline described in Schedule 17 substantially
increases, upon PacifiCare's request, PacifiCare and Supplier shall negotiate
and implement an appropriate adjustment to the applicable Fees.

         17.9 ADJUSTMENTS TO FEES. There shall be no periodic adjustments to the
Fees except as set forth in Schedule 17.

         17.10 EXPENSES. Except as expressly set forth in this Agreement, all
costs and expenses relating to the Services (including all costs and expenses
related to the acquisition, maintenance

                                               *CONFIDENTIAL TREATMENT REQUESTED

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<PAGE>

and enhancement of the Software and Equipment) are included in the Fees and
shall not be charged to or reimbursed by PacifiCare.

         17.11 RIGHTS OF SET-OFF. With respect to any amount that (a) should be
reimbursed to PacifiCare or (b) is otherwise payable to PacifiCare, in each case
pursuant to this Agreement, PacifiCare may deduct the entire amount owed to
PacifiCare against the Fees or against the expenses owed by PacifiCare to
Supplier under this Agreement.

         17.12 PRORATION. All periodic Fees under this Agreement are to be
computed on a calendar month basis and shall be prorated on a per diem basis for
any partial month.

         17.13 UNUSED CREDITS. Any unused credits against future payments owed
to either Party by the other pursuant to this Agreement shall be paid to the
applicable Party within thirty (30) days after the earlier of the expiration or
termination of this Agreement.

         17.14 [...***...]. As part of its proposal under Section 5.1, Supplier
shall (a) identify the solution and technology proposed to deliver the New
Service, including alternatives that may provide improved cost or performance
advantages, and (b) upon PacifiCare's authorization in accordance with Section
5.1, implement the agreed upon New Service. Supplier shall, where the
acquisition of New Equipment or Software is required in connection with a New
Service, upon PacifiCare's request, (x) purchase such New Equipment and recover
such purchase as a one-time charge, (y) lease, or arrange for a third party to
lease, such New Equipment, and/or (z) license, or arrange for a third party to
license, any Software contained in such New Equipment to PacifiCare. PacifiCare
shall pay to Supplier the amounts agreed by the Parties in connection with such
purchase, lease and/or license. Except as otherwise agreed by the Parties or as
otherwise provided in this Agreement, (i) all rights in and title to any New
Equipment purchased by Supplier and paid for by PacifiCare shall belong to
PacifiCare and all New Equipment shall be newly manufactured, and (ii) all
leases and license procured under this Section 3.7(b) shall be in PacifiCare's
name.

         17.15 FUNDS TRANSFER. PacifiCare shall pay Supplier amounts due
pursuant to Section 17.2 and Section 17.4 by wire transfer to the account
specified in Schedule 17.

18.      TAXES.

         18.1 Subject to Section 18.2, each Party shall be responsible for any
personal property taxes on property it owns or leases, for franchise and
privilege taxes on its business, and for taxes based on its net income or gross
receipts.

         18.2 The Fees paid to Supplier are inclusive of, and Supplier shall be
responsible for, any applicable sales, use, gross receipts, excise, value-added,
services, consumption, withholding or other taxes attributable to periods on or
after the Effective Date based upon or measured by Supplier's cost in acquiring
or providing equipment, materials, supplies or services furnished or used by
Supplier in performing or furnishing the Services, including all personal
property and sales or use taxes, if any, due on the Supplier Equipment.

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                       28
<PAGE>

         18.3 PacifiCare shall be responsible for any sales, use, gross
receipts, excise, value-added, services, consumption, withholding or other tax
in effect as of the Effective Date on the provision of the Services by Supplier
to PacifiCare, however levied or assessed, and pay the amount of any such tax.
To the extent that any sales, use, gross receipts, excise, value-added or
services tax is required by Law to be separately identified in Supplier's
invoices to PacifiCare, Supplier shall separately identify the tax and assume
any and all responsibility for non-compliance, including interest and penalty
assessments.

         18.4 In the event that any new sales, use, gross receipts, excise,
value-added, services, consumption, withholding or other taxes (collectively,
"NEW TAXES") are assessed on the provision of any of the Services, or in the
event that any tax described in Section 18.3 is increased, [...***...].

         18.5 Any taxes assessed, as determined by PacifiCare, including a
gross-up thereon, on the provision of the Services for a particular site
resulting from Supplier's relocating or rerouting the delivery of Services for
Supplier's convenience to, from or through a location other than the Service
Location used to provide the Services as of the Effective Date shall be
Supplier's responsibility; provided that, PacifiCare may pay such taxes and
PacifiCare shall receive a credit with respect to the Fees invoiced under this
Agreement equal to such payments made pursuant to this Section 18.4.

         18.6 PacifiCare and Supplier shall cooperate to segregate the Fees into
the following separate payment streams: (a) those for taxable Services; (b)
those for non-taxable Services; (c) those for which a sales, use or other
similar tax has already been paid; and (d) those for which Supplier functions
merely as a paying agent for PacifiCare in receiving goods, supplies or services
(including leasing and licensing arrangements) that otherwise are nontaxable or
have previously been subject to tax. In addition, each of PacifiCare and
Supplier shall reasonably cooperate with the other to more accurately determine
a Party's tax liability and to minimize such liability, to the extent legally
permissible. Each of PacifiCare and Supplier shall provide and make available to
the other any resale certificates, information regarding out-of-state sales or
use of equipment, materials or services, and any other exemption certificates or
information requested by a Party.

19.      AUDITS.

         19.1 SERVICES. Upon notice from PacifiCare, Supplier and Supplier
Agents shall provide PacifiCare, PacifiCare Agents and any of the PacifiCare
Entities' regulators or other reviewing bodies (including the National Committee
for Quality Assurance (NCQA), Department of Insurance (DOI), and Department of
Managed Healthcare (DMHC)) with access to and any assistance that they may
require with respect to the Service Locations and the Systems for the purpose of
performing audits or inspections of the Services and the business of the
PacifiCare Entities relating to the Services. If any audit by an auditor
designated by PacifiCare, a PacifiCare Agent or a regulatory authority results
in Supplier being notified that Supplier or

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                       29
<PAGE>

Supplier Agents are not in compliance with any Law or audit requirement,
Supplier shall, and shall cause Supplier Agents to, comply with such Law or
audit requirement promptly after such notification, and in no event later than
required by a Governmental Authority. Supplier shall bear the expense of any
such response that is (a) required by a Law or audit requirement relating to
Supplier's business or (b) necessary due to Supplier's noncompliance with any
Law or audit requirement imposed on Supplier, including as set forth in this
Agreement. To the extent the expense is not payable by Supplier pursuant to the
preceding sentence, PacifiCare shall bear the expense of any such compliance
that is required by any Law or audit requirement relating to the PacifiCare
Entities' business or that is necessary due to the PacifiCare Entities'
noncompliance with any Law or audit requirement imposed on the PacifiCare
Entities.

         19.2 FEES. Upon notice from PacifiCare, Supplier shall provide
PacifiCare and PacifiCare Agents with access to such financial records and
supporting documentation as may be requested by PacifiCare and PacifiCare and
PacifiCare Agents may audit the Fees charged to PacifiCare to determine if such
Fees are accurate and in accordance with this Agreement (including Section
17.11).

                  (a) If, as a result of such audit, PacifiCare determines that
Supplier has overcharged PacifiCare, PacifiCare shall notify Supplier of the
amount of such overcharge and Supplier shall promptly pay to PacifiCare the
amount of the overcharge, plus Interest calculated from the date of receipt by
Supplier of the overcharged amount until the date of payment to PacifiCare.

                  (b) In addition to PacifiCare's rights set forth in Section
19.2(a), in the event any such audit reveals an overcharge of [...***...] or
more, Supplier shall, at PacifiCare's option, issue to PacifiCare a credit
against the Base Fees or reimburse PacifiCare for the cost of such audit.

         19.3 OMNIBUS RECONCILIATION ACT. Without limiting the foregoing, until
the expiration of four (4) years after the End Date, Supplier agrees that the
Secretary of the Department of Health and Human Services (the "SECRETARY") and
the Comptroller General of the United States, or the designee or duly authorized
representative of either of them, shall have access to all books and records of
Supplier directly pertaining to the subject matter of this Agreement and the
provision of Services under it, in accordance with the criteria presently or
hereafter developed by the Department of Health and Human Services ("HHS") as
provided in Section 1861 of the Social Security Act, 42 U.S.C. Section
1395x(v)(1)(I), et seq. ("OBRA") and in accordance with Operational Policy
Letter #77 as currently issued and as revised from time to time by the Centers
for Medicare and Medicaid Services (formerly the Health Care Financing
Administration). Upon request of the Secretary, and in accordance with criteria
presently or hereafter developed by HHS as provided in OBRA, the Comptroller
General, the designee or the authorized representative of either of them,
Supplier shall make available (at reasonable times and places during normal
business hours) this Agreement, and all books, documents, and records of
Supplier that are necessary to verify the nature and extent of the costs of the
Services provided by Supplier and furnished in connection with this Agreement.
Supplier

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                       30
<PAGE>

further agrees that if Supplier carries out any of the duties of this Agreement
through a subcontract with a value or cost of [...***...] or more, such
subcontract shall contain a clause to the effect that until the expiration of
four (4) years after the furnishing of such services pursuant to such
subcontract, the subcontracting party shall make available, upon written request
of the Secretary, or upon request of the U.S. Comptroller General or any of
their duly authorized representatives, the subcontract, and the books, documents
and records of such organization that are necessary to verify the nature and
extent of such costs of the Services provided by such subcontracting party and
furnished in connection with this Agreement. Supplier shall promptly inform
PacifiCare of any requests for information made pursuant to this provision.

         19.4 RECORD RETENTION. Supplier shall retain records and supporting
documentation sufficient to satisfy the requirements set forth in this Section
19 and to document the Services and the Fees paid or payable by PacifiCare under
this Agreement in accordance with PacifiCare's retention policies and
procedures, as in effect from time to time.

         19.5 FACILITIES. Supplier shall provide to PacifiCare and PacifiCare
Agents, on Supplier's premises (or, if the audit is being performed of a
Supplier Agent, the Supplier Agent's premises if necessary), space, office
furnishings (including lockable cabinets) and utilities as PacifiCare or such
PacifiCare Agents may reasonably require to perform the audits described in this
Section 19.

         19.6 AUDIT SOFTWARE. Supplier shall operate and maintain such audit
software as PacifiCare may request from time to time during the Term.

         19.7 RELIEF. In the event that the frequency or scope of PacifiCare's
audits of Supplier's records under Sections 19.1 and 19.2 above are such that
Supplier can demonstrate to PacifiCare that Supplier's compliance with the
requirements of the aforesaid sections will have a material adverse effect on
Supplier's ability to provide the Services, including in accordance with the
applicable Service Levels, the Parties will negotiate in good faith to determine
an appropriate duration and level of applicable Service Level relief or other
consideration to enable Supplier to comply with its obligations under Sections
19.1 and 19.2.

20.      CONFIDENTIALITY.

         20.1 GENERAL OBLIGATIONS. All Confidential Information relating to or
obtained from the PacifiCare Entities or Supplier shall be held in strict
confidence by the recipient to the same extent and in at least the same manner
as the recipient protects its own confidential information of similar importance
(and in no event with less than reasonable care). Neither PacifiCare nor
Supplier shall disclose, publish, release, transfer or otherwise make available
Confidential Information of, or obtained from, the other Party in any form to,
or for the use or benefit of, any person or entity without the disclosing
Party's consent.

         20.2 EXCEPTIONS. Notwithstanding the foregoing, each of PacifiCare and
Supplier shall be permitted to disclose relevant aspects of the other's
Confidential Information to its officers, directors, agents, professional
advisors, contractors (including the Benchmarker), subcontractors and employees
and to the officers, directors, agents, professional advisors,

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                       31
<PAGE>

contractors, subcontractors and employees of its affiliates, to the extent such
disclosure is not restricted under any Assigned Agreements, any Managed
Agreements, any Consents or any Laws or Governmental Approvals and only to the
extent that such disclosure is reasonably necessary for the performance of its
duties and obligations or the determination, preservation or exercise of its
rights and remedies under this Agreement; provided, however, that the recipient
shall take all reasonable measures to ensure that Confidential Information of
the disclosing Party is not disclosed or duplicated in contravention of the
provisions of this Agreement by such officers, directors, agents, professional
advisors, contractors, subcontractors and employees. Furthermore, nothing in
this Agreement shall limit the ability of a Party in possession of the
Confidential Information of the other Party to disclose such Confidential
Information, and such Party shall have no liability for such disclosure, if such
disclosure is: (a) required to be made pursuant to Law, government authority,
duly authorized subpoena or court order, whereupon the receiving Party shall
provide prompt notice to the disclosing Party and give such Party an opportunity
to respond prior to such disclosure; (b) required to be made to a court or other
tribunal in connection with the enforcement of such Party's rights under this
Agreement; or (c) is approved by the prior consent of the disclosing Party.

         20.3 ATTORNEY-CLIENT PRIVILEGE. Supplier recognizes that it may obtain
access to client documents, data and databases created by and for the PacifiCare
Entities and associated communications related thereto that are marked
"privileged" or that contain a similar marking or are otherwise identified by
PacifiCare as privileged (collectively, "PRIVILEGED WORK PRODUCT") that are
confidential attorney work product or subject to the attorney-client privilege.
Supplier shall not intentionally reveal Privileged Work Product to third parties
and Supplier shall institute adequate safeguards to prevent the unintentional
disclosure of Privileged Work Product to third parties. The only Project Staff
who may have access to Privileged Work Product shall be those for whom such
access is necessary for the purpose of providing services to the PacifiCare
Entities as provided in this Agreement. Supplier recognizes that Privileged Work
Product has been prepared in anticipation of litigation and that Supplier is
performing the Services in respect of Privileged Work Product as an agent of
PacifiCare, and that all matter related thereto is protected from disclosure by
Rule 26 of the United States Federal Rules of Civil Procedure (or any similar
Law in other local jurisdictions). Should Supplier ever be notified of any
judicial or other proceeding seeking to obtain access to Privileged Work
Product, Supplier shall (a) immediately notify PacifiCare and (b) subject to
applicable Law, take such reasonable actions as may be specified by PacifiCare
to resist providing such access. PacifiCare shall have the right and duty to
represent Supplier in such resistance or to select and compensate counsel to so
represent Supplier or to reimburse Supplier for reasonable attorneys' fees and
expenses incurred in resisting such access.

         20.4 UNAUTHORIZED ACTS. Without limiting either Party's rights in
respect of a breach of this Section 20, each Party shall:

                  (a) promptly notify the other Party of any unauthorized
possession, use or knowledge, or attempt thereof, of the other Party's
Confidential Information by any person or entity that may become known to such
Party;

                  (b) promptly furnish to the other Party full details of the
unauthorized possession, use or knowledge, or attempt thereof, and assist the
other Party in investigating or preventing the recurrence of any unauthorized
possession, use or knowledge, or attempt thereof, of Confidential Information;

                                       32
<PAGE>

                  (c) cooperate with the other Party in any litigation and
investigation by the other Party against third parties to protect such Party's
proprietary rights; and

                  (d) promptly use all reasonable efforts to prevent a
recurrence of any such unauthorized possession, use or knowledge, or attempt
thereof, of Confidential Information.

                  Each Party shall bear the cost it incurs as a result of
compliance with this Section 20.

         20.5 INJUNCTIVE RELIEF. The Parties acknowledge and agree that monetary
damages may be inadequate to compensate for a breach of the provisions contained
in this Section 20 or other confidentiality provisions of this Agreement. In the
event of such breach, the injured Party may seek injunctive relief and any and
all other remedies available at law or in equity. This Section 20.5 in no way
limits the liability or damages that may be assessed against a Party in the
event of a breach of this Section 20 by the other Party.

         20.6 RESIDUAL INFORMATION. Except for [...***...] the Party receiving
Confidential Information may use in its business activities, in the case of
Supplier, the data processing ideas, concepts and know-how contained in such
Confidential Information, and in the case of PacifiCare, the general ideas,
concepts, and know-how contained in such Confidential Information, in each case
retained in the unaided memories of the receiving Party's employees involved in
the provision or receipt of the Services (and not intentionally memorized for
the purpose of later recording or use) ("RESIDUAL INFORMATION"). Nothing
contained in this Section 20.6 shall entitle the receiving Party to disclose the
source of the Residual Information. For purposes of this Section 20.6, the term
"business activities" shall mean, in the case of Supplier, the provision of
information technology products and services, and in the case of PacifiCare, the
provision of healthcare-related products and services.

21.      REPRESENTATIONS AND WARRANTIES.

         21.1 BY PACIFICARE. PacifiCare represents and warrants to Supplier
that:

                  (a) PacifiCare is a corporation duly incorporated, validly
existing and in good standing under the Laws of the State of Delaware;

                  (b) PacifiCare has all requisite corporate power and authority
to execute, deliver and perform its obligations under this Agreement;

                  (c) the execution, delivery and performance of this Agreement
by PacifiCare (i) has been duly authorized by PacifiCare and (ii) shall not
conflict with, result in a breach of or constitute a default under any other
agreement to which PacifiCare is a party or by which PacifiCare is bound;

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                       33
<PAGE>

                  (d) PacifiCare is duly licensed, authorized or qualified to do
business and is in good standing in every jurisdiction in which a license,
authorization or qualification is required for the ownership or leasing of its
assets or the transaction of business of the character transacted by it, except
where the failure to be so licensed, authorized or qualified would not have a
material adverse effect on PacifiCare's ability to fulfill its obligations under
this Agreement; and

                  (e) PacifiCare is in compliance with all Laws and has obtained
all applicable permits and licenses required of PacifiCare in connection with
its obligations under this Agreement, except 1) with respect to issues, concerns
or requests regarding PacifiCare or California (DMHC File No. 933-0126),
PacifiCare Behavioral Health of California, Inc. (DMHC File No. 933-0301) and/or
PacifiCare Dental (DMHC File No. 933-0100) that may be forthcoming from the
DMHC, arising from or related to the DMHC Filing, and 2) where the failure to
comply with such Laws or obtain such permits and licenses would not have a
material adverse effect on PacifiCare's or Supplier's ability to fulfill its
respective obligations under this Agreement.

         21.2 BY SUPPLIER. Supplier represents and warrants to PacifiCare that:

                  (a) Supplier is a corporation duly incorporated, validly
existing and in good standing under the Laws of the State of New York;

                  (b) Supplier has all requisite corporate power and authority
to execute, deliver and perform its obligations under this Agreement;

                  (c) the execution, delivery and performance of this Agreement
by Supplier (i) has been duly authorized by Supplier and (ii) shall not conflict
with, result in a breach of or constitute a default under any other agreement to
which Supplier is a party or by which Supplier is bound;

                  (d) Supplier is duly licensed, authorized or qualified to do
business and is in good standing in every jurisdiction in which a license,
authorization or qualification is required for the ownership or leasing of its
assets or the transaction of business of the character transacted by it, except
where the failure to be so licensed, authorized or qualified would not have a
material adverse effect on Supplier's ability to fulfill its obligations under
this Agreement;

                  (e) Supplier is in compliance with all Laws applicable to
Supplier's obligations under this Agreement and has obtained all applicable
permits and licenses required of Supplier in connection with its obligations
under this Agreement;

                  (f) there is no outstanding litigation, arbitrated matter or
other dispute to which Supplier is a party that, if decided unfavorably to
Supplier, would reasonably be expected to have a material adverse effect on
Supplier's ability to fulfill its obligations under this Agreement; and

         21.3 DISCLAIMER. EXCEPT AS SPECIFIED IN SECTION 21.1 AND SECTION 21.2,
NEITHER PACIFICARE NOR SUPPLIER MAKES ANY OTHER WARRANTIES WITH RESPECT TO THE
SERVICES OR THE SYSTEMS AND EACH EXPLICITLY DISCLAIMS ALL OTHER WARRANTIES,
EXPRESS OR IMPLIED,

                                       34
<PAGE>

INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A SPECIFIC
PURPOSE.

22.      ADDITIONAL COVENANTS.

         22.1 BY PACIFICARE. PacifiCare covenants and agrees with Supplier that
during the Term and the Termination Assistance Period:

                  (a) PacifiCare shall comply with all Laws applicable to
PacifiCare, except where the failure to comply would not have a material adverse
effect on PacifiCare's or Supplier's ability to fulfill its respective
obligations under this Agreement; and

                  (b) PacifiCare shall not expressly direct Supplier, in
providing the Services, to take actions that violate PacifiCare Laws, provided
that to the extent Supplier knew or should have known that such action would
violate a PacifiCare Law, PacifiCare shall not have breached this Section
22.1(b), and Supplier shall not be entitled to assert such a breach.

         22.2 BY SUPPLIER. Supplier covenants and agrees with PacifiCare that
during the Term and the Termination Assistance Period:

                  (a) in addition to meeting or exceeding all Service Levels,
Supplier shall at all times render the Services promptly and diligently and
perform in a professional and workmanlike manner;

                  (b) Supplier shall at all times use qualified individuals with
suitable training, education, competence and skill to perform the Services, as
applicable;

                  (c) Supplier shall comply with all Laws applicable to Supplier
except where the failure to comply would not have a material adverse effect on
Supplier's or PacifiCare's ability to fulfill its respective obligations under
this Agreement;

                  (d) from and after the Effective Date, in providing the
Services, Supplier shall comply with the Medical Confidential Information Laws,
including Medical Confidential Information Laws that PacifiCare, as a Covered
Entity, is required to require Supplier to comply with as a Business Associate,
and any measures PacifiCare adopts from time to time in order to comply with
Medical Confidential Information Laws (provided that PacifiCare provides notice
of such measures to the Supplier Client Relationship Manager). In the event that
the requirements of any Medical Confidential Information Laws are more
restrictive or protective of information than the confidentiality and
nondisclosure provisions of this Agreement, the Medical Confidential Information
Laws shall control;

                  (e) Supplier shall use all reasonable efforts to prevent the
introduction or coding of viruses or similar items into the Systems. In the
event a virus or similar item is introduced into the Systems, and such
introduction is not attributable to Supplier or Supplier Agents (including
Supplier's failure to perform its obligations under this Agreement), Supplier
shall use all reasonable efforts to assist the PacifiCare Entities in reducing
the effects of the virus or similar item, and, if the virus or similar item
causes a loss of operational efficiency or loss of data, to assist the
PacifiCare Entities to the same extent to mitigate and restore such losses,

                                       35
<PAGE>

provided that Supplier is not obligated to restore lost data resulting from such
introduction [...***...]. In the event a virus or similar item is introduced
into the Systems, and such introduction is attributable to Supplier or Supplier
Agents (including Supplier's failure to perform its obligations under this
Agreement), Supplier shall use all reasonable efforts to reduce the effects of
the virus or similar item, and, if the virus or similar item causes a loss of
operational efficiency or loss of data, to mitigate the loss of operational
efficiency and restore the loss of data [...***...]; and

                  (f) without the consent of PacifiCare, Supplier shall not
insert into the Software used to provide the Services any code that disables or
otherwise shuts down all or any portion of the Services. Supplier further
covenants that, with respect to any disabling code that may be part of the
Software used to provide the Services, Supplier shall not invoke such disabling
code at any time, including upon expiration or termination of this Agreement,
without PacifiCare's consent.

23.      DISPUTE RESOLUTION.

         23.1 RESOLUTION PROCEDURES. Except as otherwise provided below, the
Parties shall attempt to resolve any dispute arising under or related to this
Agreement (a "DISPUTE") in accordance with the procedures set forth in this
Section 23.1.

                  (a) CONTRACT MANAGERS. Within [...***...] after either Party
furnishes to the other notice of a Dispute, the PacifiCare [...***...] and the
Supplier [...***...] shall consider the Dispute in person or BY telephone and
shall attempt in good faith to resolve the Dispute for a period of [...***...],
or [...***...] in the event of a fee Dispute. If the Dispute is not resolved, as
agreed by the Parties in writing, within such period, the Dispute shall be
escalated in accordance with Section 23.1(b) below.

                  (b) VICE PRESIDENTS. If a Dispute is not resolved in
accordance with Section 23.1(a) above, Supplier's [...***...] (or any successor
position) shall meet with PacifiCare to discuss the Dispute with PacifiCare's
[...***...] or his or her designee at a PacifiCare Service Location or other
location specified by PacifiCare, and the Parties shall attempt in good faith to
resolve the Dispute for a period of [...***...], or [...***...] in the event of
a fee Dispute. Unless the Parties otherwise agree in writing, either Party may
pursue its rights and remedies under this Agreement after the expiration of such
period.

         23.2 EXCLUSIONS. Notwithstanding the foregoing, Disputes relating to
Section 15.4, Section 20 or Section 26 shall not be subject to Section 23.1. In
addition, nothing in this Agreement shall limit either Party's right to seek
immediate injunctive or other equitable relief whenever the facts or
circumstances would permit a Party to seek such relief in a court of competent
jurisdiction.

         23.3 CONTINUITY OF SERVICES. Supplier acknowledges that the timely and
complete performance of its obligations pursuant to this Agreement is critical
to the business and operations of the PacifiCare Entities. Accordingly, in the
event of a Dispute between PacifiCare

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                       36

<PAGE>

and Supplier, and provided that PacifiCare is in compliance with Section 17.7,
Supplier shall continue to so perform its obligations under this Agreement in
good faith during the resolution of such Dispute.

24.      TERMINATION.

         24.1 TERMINATION FOR CONVENIENCE. PacifiCare may terminate this
Agreement, effective any time after [...***...] by giving Supplier notice of the
termination at least one hundred and eighty (180) days prior TO the termination
date specified in the notice.

         24.2 TERMINATION FOR CHANGE IN CONTROL. In the event of a Change in
Control of Supplier, PacifiCare or either Party's respective parent companies,
PacifiCare may terminate this Agreement, at its sole discretion, by giving
Supplier notice of the termination at least one hundred eighty (180) days prior
to the termination date specified in the notice.

         24.3 TERMINATION FOR CAUSE.

                  (a) If Supplier defaults in the performance of any of its
material obligations (including by repeatedly defaulting in the performance of
any of its obligations which, when combined, constitute a breach of a material
obligation) under this Agreement (except as provided in Section 24.4), and does
not cure such default within [...***...] (the "SUPPLIER DEFAULT CURE PERIOD")
after receipt of a notice of default from PacifiCare (the "SUPPLIER DEFAULT
NOTICE"), then PacifiCare may, without limiting PacifiCare's other rights or
remedies under this Agreement, by giving notice to Supplier, terminate this
Agreement, in whole or in part, as of the termination date specified in the
Supplier Default Notice, such date to be no more than ninety (90) days after the
date of the Supplier Default Notice, unless otherwise agreed by the Parties.

                  (b) If PacifiCare fails to make undisputed payments due to
Supplier under this Agreement and does not pay such undisputed amounts within
[...***...] (the "PACIFICARE DEFAULT CURE PERIOD") of receipt of Supplier's
notice of PacifiCare's failure to pay such undisputed amounts (the "PACIFICARE
DEFAULT Notice"), then Supplier may, by giving notice to PacifiCare, terminate
this Agreement in whole as of the termination date specified in the PacifiCare
Default Notice. If PacifiCare disputes any amounts that are the subject of the
PacifiCare Default Notice and fails to pay such amounts in accordance with
Section 17.7 during the PacifiCare Default Cure Period (subject to the
resolution of such Dispute), then Supplier may, by giving notice to PacifiCare,
terminate this Agreement in whole as of the termination date specified in the
PacifiCare Default Notice.

         24.4 TERMINATION FOR FAILURE TO PROVIDE CRITICAL SERVICES. If Supplier
fails to provide any Critical Service and does not, within [...***...] after
such failure identified on Schedule 24.4 with respect to such Critical Service,
cure such failure or, if such failure cannot be cured within [...***...]
identified on Schedule 24.4 with respect to such Critical Service, provide
PacifiCare with a workaround that allows PacifiCare to receive such Critical
Service in accordance with this Agreement, [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                       37

<PAGE>
[...***...] Nothing in this Section 24.4 shall be deemed to limit or obviate
PacifiCare's right to terminate this Agreement pursuant to Section 24.3(a).

         24.5     TERMINATION IN PART. If PacifiCare elects to terminate this
Agreement "in part" pursuant to its termination rights under this Agreement, the
part of the Agreement terminated must be [...***...]. If PacifiCare terminates
the [...***...] or Insources a portion of the [...***...], the Parties will
negotiate in good faith and implement an equitable adjustment to this Agreement
to accommodate such termination or Insourcing.

25.      TERMINATION FEES.

         25.1     EARLY TERMINATION FEE. If PacifiCare terminates this Agreement
pursuant to Section 24.1, then PacifiCare shall pay Supplier the early
termination fees set forth in Schedule 17 (the "EARLY TERMINATION FEE").
PacifiCare shall pay the Early Termination Fee within thirty (30) days of the
last day of the month in which Supplier is providing Termination Assistance
Services following termination pursuant to Section 24.1.

         25.2     ASSET PURCHASE. Upon the expiration or termination of this
Agreement by either Party for any reason, at PacifiCare's sole discretion,
PacifiCare shall have the option to purchase from Supplier any Equipment,
Software or other materials purchased by Supplier or Supplier Agents to provide
the Services, or any portion thereof, at the lesser of fair market value or book
value.

         25.3     NO OTHER FEES. Except as expressly set forth in this Section
25, Section [...***...], Section 16.3 and Section 26, PacifiCare shall have no
obligation to pay any termination fee or other fees to Supplier in connection
with the termination of this Agreement, and any recovery or remedy sought by
Supplier for such termination shall be limited to the Early Termination Fee set
forth in this Section 25 and the Termination Assistance Services Fees (as
described in Section 26.2). Supplier agrees that if PacifiCare terminates this
Agreement pursuant to Section 24.3(a) or Section 24.4, then Supplier shall not
be entitled to any Early Termination Fee, except for any payments due for any
Equipment, Software or other materials that PacifiCare elects to purchase
pursuant to Section 26.3 and for any Termination Assistance Services Fees as set
forth in Section 26 below.

26.      TERMINATION ASSISTANCE.

         26.1     TERMINATION ASSISTANCE SERVICES.

                  (a)      Commencing up to six (6) months before the expiration
or any earlier termination of this Agreement, upon the request of and as
specified by PacifiCare, and in accordance with this Section 26, Supplier shall
provide the Termination Assistance Services described in Schedule 26.1 (the
"TERMINATION ASSISTANCE SERVICES") to facilitate the smooth transition of the
Services (and other functions being performed by Supplier and Supplier Agents

                                               *CONFIDENTIAL TREATMENT REQUESTED
                                       38
<PAGE>
under this Agreement at the time of such expiration or termination) to
PacifiCare or another service provider of PacifiCare's choosing (the
"DESIGNEE").

                  (b)      PacifiCare may also (i) upon the request of and as
specified by PacifiCare, and subject to Section 26.2 below, require Supplier to
provide the Termination Assistance Services up to twelve (12) months following
the effective date of expiration or any termination of this Agreement, and (ii)
at the end of such twelve- (12)-month period and upon the request of and as
specified by PacifiCare, require Supplier to provide the Termination Assistance
Services for an additional period of up to six (6) months following the end of
the twelve (12)-month period described above (collectively, the period of
Termination Assistance Services prior to the effective date of expiration or
termination of this Agreement and the periods referred to in clauses (i) and
(ii) above, the "TERMINATION ASSISTANCE PERIOD"). Without limiting Supplier's
obligations to provide the Termination Assistance Services in accordance with
this Section 26, following a request by PacifiCare that Supplier perform the
Termination Assistance Services, PacifiCare shall, as soon as reasonably
practicable, advise Supplier of the anticipated duration of the Termination
Assistance Period, and, to the extent reasonably possible, the types of
Termination Assistance Services that PacifiCare anticipates it will require
during such period.

                  (c)      During the Termination Assistance Period, Supplier
shall provide the Termination Assistance Services until PacifiCare, in its sole
discretion, provides Supplier notice that the Services have been satisfactorily
transferred to PacifiCare or the Designee.

                  (d)      The quality and level of Termination Assistance
Services and other services performed during the Termination Assistance Period
shall not be materially degraded from the level of service (including Service
Levels, where applicable) provided by Supplier and Supplier Agents for similar
services during the Term.

                  (e)      After the expiration of the Termination Assistance
Period, Supplier shall (i) answer questions from the PacifiCare Entities
regarding the Services on an "as needed" basis at Supplier's then-standard
billing rates and (ii) deliver to PacifiCare any remaining PacifiCare
Entity-owned reports and documentation still in Supplier's possession.

         26.2     TERMINATION ASSISTANCE SERVICES FEES.

                  (a)      With respect to Termination Assistance Services that
are Services performed under this Agreement prior to the Termination Assistance
Period:

                           (i)      During the Termination Assistance Period
prior to the expiration or termination of this Agreement, Supplier shall provide
Termination Assistance Services at no additional charge to PacifiCare to the
extent that such assistance can be provided through resources included in the
Base Fees without materially interfering with Supplier's ability to perform the
Services. To the extent that any Termination Assistance Services cannot be
provided using resources included in the Base Fees, PacifiCare shall pay
Supplier to provide such services in accordance with Section 17.3.

                           (ii)     During the Termination Assistance Period
after the expiration or termination of this Agreement, if applicable, Supplier
shall provide Termination Assistance Services at the rates applicable under this
Agreement for such services.

                                       39
<PAGE>
                  (b)      With respect to Termination Assistance Services that
are not Services performed under this Agreement prior to the Termination
Assistance Period, Supplier shall provide such services during the Termination
Assistance Period in accordance with Section 5.1 and Section 17.14.

                  (c)      The fees paid for Termination Assistance Services
(the "TERMINATION ASSISTANCE SERVICES FEES") are to be paid in accordance with
the payment terms set forth in Section 17. Supplier shall have no obligation to
provide Termination Assistance Services if PacifiCare fails to comply with
Section 17.7.

         26.3     EXIT DUTIES AND EXIT RIGHTS. Upon the later of the expiration
or termination of this Agreement and the last day of the Termination Assistance
Period (the "END DATE"):

                  (a)      The rights granted to Supplier and Supplier Agents in
Section 14.2 shall immediately terminate and Supplier shall, and shall cause
Supplier Agents to, (i) deliver to PacifiCare, at no cost to PacifiCare, a
current copy of the PacifiCare Software in the form in use as of the End Date
and (ii) destroy or erase all other copies of the PacifiCare Software in
Supplier's or Supplier Agents' possession. Supplier shall, upon PacifiCare's
request, certify to PacifiCare that all such copies have been destroyed or
erased.

                  (b)      Supplier shall promptly deliver to PacifiCare a copy
of any Software that is subject to a Back-End Consent in the form in use for
performance of the Services as of the End Date. If the Software subject to this
Section 26.3(b) is Supplier Proprietary Software, Supplier shall also provide to
the PacifiCare Entities support and maintenance services for such Software and
Tools on terms, conditions and prices agreed upon by the Parties, which shall in
no event [...***...].

                  (c)      Upon PacifiCare's request, for a period of
[...***...] after the End Date, with respect to any Supplier Software or Tools
that Supplier is using to provide the Services as of the date of termination or
expiration of this Agreement and that Supplier operates on equipment located at
one or more Supplier Service Locations, Supplier shall provide to the PacifiCare
Entities or PacifiCare's designees remote access to and use of such Supplier
Software and Tools, together with all hosting, maintenance, support and other
services required for the PacifiCare Entities or PacifiCare's designees to use
such Supplier Software and Tools to continue the Services, all on terms,
conditions and prices agreed upon by the Parties, which shall in no event be
[...***...]. Supplier shall provide such additional assistance as may be
necessary to permit PacifiCare to establish the same or similar functions on
equipment at PacifiCare's or another service provider's locations.

                  (d)      Supplier shall (i) deliver to PacifiCare a copy of
all of the Work Product, in the form in use as of the End Date, and (ii) destroy
or erase all other copies of the Work Product in Supplier's possession.

                  (e)      [...***...]. Upon PacifiCare's request, Supplier
shall assist the PacifiCare Entities in obtaining directly from third

                                               *CONFIDENTIAL TREATMENT REQUESTED
                                       40
<PAGE>
parties any third party Software or services used in the provision of the
Services, which Software and services are not subject to a Back-End Consent.

                  (f)      Upon PacifiCare's request, Supplier shall sell to
PacifiCare or its Designee (i) the Supplier Equipment being used by Supplier or
Supplier Agents solely to perform the Services as of the End Date and (ii) any
other assets transferred by the PacifiCare Entities to Supplier or Supplier
Agents and used to provide the Services as of the End Date, free and clear of
all liens, security interests or other encumbrances at the lesser of the fair
market value, as shall be determined by an agreed-upon appraisal, and the book
value. Supplier shall also furnish to the PacifiCare Entities all user and other
documentation in its possession that relates to such Equipment.

                  (g)      PacifiCare shall have the right to extend offers of
employment to all Supplier and Supplier Agent personnel who have been or are
assigned to or have or are performing any Services or other work on behalf of
Supplier or Supplier Suppliers with respect to PacifiCare. Supplier and Supplier
Suppliers shall provide reasonable access to such personnel and shall not
interfere in any way with any such solicitation by PacifiCare.

                  Where any of the foregoing rights under this Section 26.3 may
be requested by PacifiCare, PacifiCare may request such rights either before or
after the End Date.

27.      INDEMNITIES.

         27.1     INDEMNITY BY PACIFICARE. PacifiCare shall indemnify Supplier
from, and defend and hold Supplier harmless from and against, any Losses
suffered, incurred or sustained by Supplier or to which Supplier becomes
subject, resulting from, arising out of or relating to any claim:

                  (a)      that the PacifiCare Software infringes upon the
proprietary rights of any third party (except as may have been caused by a
modification by Supplier or Supplier Agents, or by written directions or
specifications provided to PacifiCare by Supplier or Supplier Agents);

                  (b)      relating to the inaccuracy, untruthfulness or breach
of any representation or warranty [...***...];

                  (c)      relating to (i) a violation by the PacifiCare
Entities or PacifiCare Agents of Law for the protection of persons or members of
a protected class or category of persons, including unlawful discrimination,
(ii) work-related injury (except as may be covered by PacifiCare's workers'
compensation plan) or death caused by the PacifiCare Entities or PacifiCare
Agents, (iii) accrued employee benefits not expressly assumed by Supplier, (iv)
any representations, oral or written, made by PacifiCare or PacifiCare Agents to
the Affected Employees and (v) any other aspect of the Affected Employees'
employment relationship with PacifiCare or termination of such employment
relationship with PacifiCare (including claims for breach of an express or
implied contract of employment);

                                               *CONFIDENTIAL TREATMENT REQUESTED
                                       41
<PAGE>
                  (d)      relating to any amounts, including taxes, interest
and penalties, assessed against Supplier that are the obligation of PacifiCare
pursuant to Section 18;

                  (e)      relating to personal injury (including death) or
property loss or damage resulting from PacifiCare's acts or omissions;

                  (f)      relating to a breach of Section 20;

                  (g)      relating to PacifiCare's failure to comply with the
Consents and Governmental Approvals applicable to PacifiCare, PacifiCare's
failure to obtain and maintain the PacifiCare Governmental Approvals,
[...***...];

                  (h)      relating to a breach of PacifiCare's obligations
under Section 22.1(a); [...***...]; and

                  (i)      relating to a breach of PacifiCare's obligations
under Section 30.3.

                  [...***...].

         27.2     INDEMNITY BY SUPPLIER. Supplier shall indemnify the PacifiCare
Entities from, and defend and hold the PacifiCare Entities harmless from and
against, any Losses suffered, incurred or sustained by the PacifiCare Entities
or to which the PacifiCare Entities become subject resulting from, arising out
of or relating to any claim:

                  (a)      that the Work Product, Supplier Tools, Supplier
Software, Supplier Equipment, any enhancements or modifications to the
PacifiCare Software performed by Supplier or Supplier Agents or any other
resources or items provided to the PacifiCare Entities by Supplier or Supplier
Agents infringe upon the proprietary or other rights of any third party (except
as may have been caused by a modification by the PacifiCare Entities or
PacifiCare Entity Agents, or by written directions or specifications provided to
Supplier by PacifiCare or the PacifiCare Entities);

                  (b)      relating to any duties or obligations of Supplier or
Supplier Agents in respect of a third party or any subcontractor of Supplier;

                  (c)      by a third party customer of Supplier arising from
services or systems provided by Supplier or Supplier Agents from a Service
Location that is shared with customers of Supplier [...***...];

                                               *CONFIDENTIAL TREATMENT REQUESTED
                                       42
<PAGE>
                  (d)      relating to the inaccuracy, untruthfulness or breach
of any representation or warranty specified in Section 21.2; [...***...];

                  (e)      relating to Supplier's failure to obtain, maintain or
comply with the Consents, obtain and maintain Supplier Governmental Approvals,
comply with Governmental Approvals applicable to Supplier, [...***...];

                  (f)      relating to (i) a violation by Supplier or Supplier
Agents of Law for the protection of persons or members of a protected class or
category of persons, including unlawful discrimination, (ii) work-related injury
(except as may be covered by Supplier's workers' compensation plan) or death
caused by Supplier or Supplier Agents, (iii) accrued employee benefits not
expressly retained by the PacifiCare Entities, (iv) any representations, oral or
written, made by Supplier or Supplier Agents to the PacifiCare Entities'
employees, including the Affected Employees and (v) any other aspect of the
Affected Employees' employment relationship with Supplier or the termination of
the employment relationship with Supplier (including claims for breach of an
express or implied contract of employment);

                  (g)      relating to any amounts, including taxes, interest
and penalties, assessed against the PacifiCare Entities that are the obligation
of Supplier pursuant to Section 18;

                  (h)      relating to personal injury (including death) or
property loss or damage resulting from Supplier's or Supplier Agents' acts or
omissions;

                  (i)      relating to a breach of Supplier's obligations with
respect to Section 15.1, Section 15.2 and Section 15.4;

                  (j)      relating to a breach of Section 20;

                  (k)      relating to a breach of Supplier's obligations under
Section 22.2(c) and 22.2(d); [...***...]; and

                  (l)      [...***...].

                  [...***...].

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       43
<PAGE>
         27.3     INDEMNIFICATION PROCEDURES. If any claim is commenced against
a person or entity entitled to indemnification under Section 27.1 or Section
27.2 (the "INDEMNIFIED PARTY"), notice thereof shall be given to the Party that
is obligated to provide indemnification (the "INDEMNIFYING PARTY") as promptly
as practicable. If, after such notice, the Indemnifying Party shall acknowledge
that this Agreement applies with respect to such claim, then the Indemnifying
Party shall be entitled, if it so elects, in a notice promptly delivered to the
Indemnified Party, but in no event less than ten (10) days prior to the date on
which a response to such claim is due, to immediately take sole control of the
defense and investigation of such claim and to employ and engage attorneys
reasonably acceptable to the Indemnified Party to handle and defend the same, at
the Indemnifying Party's sole cost and expense. The Indemnified Party shall
cooperate, at the cost of the Indemnifying Party in all reasonable respects with
the Indemnifying Party and its attorneys in the investigation, trial and defense
of such claim and any appeal arising therefrom. The Indemnified Party may, at
its own cost and expense, participate, through its attorneys or otherwise, in
such investigation, trial and defense of such claim and any appeal arising
therefrom, provided that such participation does not unreasonably interfere with
the Indemnifying Party's ability to defend such claim. No settlement of a claim
that involves a remedy other than the payment of money by the Indemnifying Party
shall be entered into without the consent of the Indemnified Party. After notice
by the Indemnifying Party to the Indemnified Party of its election to assume
full control of the defense of any such claim, the Indemnifying Party shall not
be liable to the Indemnified Party for any legal expenses incurred thereafter by
such Indemnified Party in connection with the defense of that claim. If the
Indemnifying Party does not assume full control over the defense of a claim
subject to such defense as provided in this Section 27, the Indemnifying Party
may participate in such defense, at its sole cost and expense, and the
Indemnified Party shall have the right to defend the claim in such manner as it
may deem appropriate, at the cost and expense of the Indemnifying Party.

         27.4     OBLIGATION TO REPLACE.

                  (a)      SUPPLIER. In the event that the use of the Work
Product, the Supplier Software, the Supplier Tools, the Supplier Equipment or
any modifications or enhancements to the PacifiCare Software or the Tools
performed by Supplier or Supplier Agents, (each, as applicable, the "SUPPLIER
INDEMNIFIED COMPONENT"), pursuant to an indemnifiable claim according to 27.2(a)
is found to infringe upon the intellectual property or proprietary rights of any
third party or is enjoined, Supplier shall provide PacifiCare with a written
plan detailing how Supplier shall, at Supplier's cost and expense and to the
extent possible in such a manner that does not materially affect PacifiCare's
business activities: (i) obtain the right to continue using the Supplier
Indemnified Component; (ii) modify the Supplier Indemnified Component so that it
is no longer infringing while maintaining the substantially similar
functionality; or (iii) replace the Supplier Indemnified Component with a
non-infringing replacement with the same functionality. Supplier shall obtain
PacifiCare's consent to such plan before implementing the plan. Supplier shall
provide to PacifiCare at Supplier's cost and expense and as soon as practicable
any training of Supplier personnel necessary to enable Supplier personnel to use
the modified or replaced Supplier Indemnified Component.

                  (b)      PACIFICARE. In the event that the use of the
PacifiCare Software (each, as applicable, the "PACIFICARE INDEMNIFIED
COMPONENT"), pursuant to an indemnifiable claim according to 27.1(a) is found to
infringe upon the intellectual property or proprietary rights of

                                       44
<PAGE>
any third party or is enjoined, and to the extent such infringement materially
hinders Supplier's ability to provide the Services, PacifiCare shall, at
PacifiCare's cost and expense and in such a manner as to minimize disturbances
to Supplier's provision of the Services: (i) obtain for Supplier the right to
continue using the PacifiCare Indemnified Component; (ii) modify the PacifiCare
Indemnified Component so that it is no longer infringing; or (iii) replace the
PacifiCare Indemnified Component with a substantially similar non-infringing
component.

28.      DAMAGES.

         28.1     CONSEQUENTIAL DAMAGES. Subject to Section 28.4, in no event
shall either the PacifiCare Entities or Supplier be liable for any indirect,
incidental, special or consequential damages, arising out of or relating to its
performance or failure to perform under this Agreement, even if advised of the
possibility of such damages.

         28.2     DIRECT DAMAGES. Each of the Parties shall be liable to the
other for any direct damages arising out of or relating to its performance or
failure to perform under this Agreement; [...***...].

         28.3     BASIS OF THE BARGAIN. Each Party acknowledges that the
foregoing limitations are an essential element of this Agreement between the
Parties and that in the absence of such limitations the pricing and other terms
set forth in this Agreement would be substantially different.

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       45
<PAGE>
         28.4     EXCLUSIONS. The limitations or exculpations of liability set
forth in Section 28.1 and Section 28.2 shall not apply to: [...***...].

29.      INSURANCE.

         29.1     TYPES AND AMOUNTS. During the term of this Agreement, Supplier
shall procure and maintain, at Supplier's sole cost and expense, the following
insurance coverages:

                  (a)      COMMERCIAL GENERAL LIABILITY INSURANCE, including
premises, products (if products are being provided) /completed operations (if
services are being provided) and contractual liability with limits of not less
than [...***...] per occurrence and [...***...] aNNUAL aggregate for bodily
injury and property damage. Said insurance shall be provided on an "occurrence"
form.

                  (b)      AUTOMOBILE LIABILITY INSURANCE (if performing any
activities on PacifiCare's premises) with limits of not less than [...***...]
per occurrence, combined single limit for bodily injury and property damage,
covering owned non-owned and hired vehiclES.

                  (c)      WORKERS COMPENSATION AND EMPLOYERS LIABILITY. If the
Supplier is an employer of one or more employees, workers compensation and
employers liability coverage with minimum limits of:

                           (i)      Workers Compensation - statutory as required
                                    by law

                           (ii)     Employers Liability-

<TABLE>
<S>                                                                 <C>
                                    bodily injury by accident:      $[...***...] each accident

                                    bodily injury by disease:       $[...***...] each employee

                                    bodily injury by disease:       $[...***...] policy limit
</TABLE>

                  (d)      If Supplier has a claims-made based policy (or
policies) and such policy (or policies) are cancelled or not renewed, Supplier
agrees to exercise any option contained in said policy (or policies) to extend
the reporting period to the maximum period permitted; provided, however, that
Supplier need not exercise such option if the superseding insurer shall accept
all prior claims.

                  (e)      Supplier may satisfy the coverage minimums set forth
in 29.1(a)-(d) by any combination of primary or umbrella coverage, provided that
any umbrella coverage used to meet the coverage minimums set forth in
29.1(a)-(d) must meet or exceed the aggregate coverage minimums for all claims
covered by such umbrella coverage.

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       46
<PAGE>
         29.2     SUPPLIER AGENTS. Supplier shall require that each Supplier
Agent carry Commercial General Liability insurance, including premises,
products, completed operations and contractual liability insurance, and in
addition, carry Automobile Liability insurance (if performing on PacifiCare's
premises), Workers Compensation and Employers Liability insurance, and
Consultant's Errors and Omission Liability insurance with the same minimum
limits as required herein for Supplier. Except with regard to the Affected
Contractors engaged by Supplier pursuant to this Agreement, Supplier shall
require that all Supplier Agents shall carry the aforementioned insurance with
the same minimum limits as required for Supplier in Section 29.1 above.

         29.3     DOCUMENTATION. Each of Supplier's and Supplier Agents'
insurance policies shall:

                  (a)      be issued by companies that are admitted insurers in
the jurisdiction in which the services or products are being provided;

                  (b)      be issued by companies that have an A. M. Best rating
of not less than "A-", and are in a size category which is not lower than
"VIII";

                  (c)      be primary and noncontributory with any of
PacifiCare's insurance;

                  (d)      name PacifiCare as an additional insured; (except
Workers Compensation, Employers Liability and Errors and Omissions coverages)
and

                  (e)      provide PacifiCare with thirty (30) days prior notice
of cancellation, non-renewal or material change in the form or limits of
coverage.

                  (f)      Supplier and Supplier Agents shall cause its
insurance carriers, brokers or agents to issue to PacifiCare certificates of
insurance evidencing all insurance coverages, and any renewals thereof, required
by this Section 29.

                  (g)      Notwithstanding any other provision of this
Agreement, failure to provide the certificates of insurance shall be grounds for
immediate termination of this Agreement.

         29.4     SELF-INSURANCE. If any of the required coverages are provided
by a self-insurance arrangement, a wholly owned insurance subsidiary (captive)
or a risk retention group, the above requirement may be waived at the sole
discretion of PacifiCare, but only after review of the self-insured's, captive's
or risk retention group's most current audited financial statement and actuarial
report. In addition Supplier agrees, during the Term of this Agreement, to
provide PacifiCare with updated financial statements and actuarial reports
within a reasonable time after the close of each of the self-insurance program's
plan year.

         29.5     INTENTIONS. None of the foregoing requirements as to the type
and limits of insurance to be maintained by Supplier and Supplier Agents are
intended to and shall not in any manner limit or qualify the liabilities and
obligations assumed by Supplier under this Agreement.

                                       47
<PAGE>
30.      MISCELLANEOUS PROVISIONS.

         30.1     AMENDMENTS. No amendment to, or change, waiver or discharge
of, any provision of this Agreement shall be valid unless in writing and signed
by, in the case of PacifiCare, the PacifiCare Supplier Relationship Manager, and
in the case of the Supplier, the Supplier Client Relationship Manager.

         30.2     ASSIGNMENT.

                  (a)      Neither Party shall, without the consent of the other
Party, assign this Agreement, except that PacifiCare may assign this Agreement
to a PacifiCare Included Affiliate or another entity or business unit of
PacifiCare or pursuant to a reorganization or Change in Control of PacifiCare
without such consent. Without limitation of any of its obligations under this
Agreement, Supplier may assign its right to payment under this Agreement to an
affiliate Controlled by Supplier, provided that PacifiCare shall not be liable
to make any payments directly to such assignee. Upon PacifiCare's assignment of
this Agreement to a PacifiCare Included Affiliate or another PacifiCare entity
or business unit or pursuant to a reorganization or Change in Control of
PacifiCare, and upon such entity's assumption of PacifiCare's obligations under
this Agreement, PacifiCare shall be released from any obligation or liability
under this Agreement provided that, except with respect to a Change in Control
of PacifiCare, Supplier consents to such release (which consent may only be
withheld based on reasonable good faith considerations relating to the
assignee's ability to perform PacifiCare's financial obligations under this
Agreement). The consent of a Party to any assignment of this Agreement shall not
constitute such Party's consent to further assignment. This Agreement shall be
binding on the Parties and their respective successors and permitted assigns.
Any assignment in contravention of this Section 30.2 shall be void.

                  (b)      In the event that PacifiCare divests an entity or
business unit of PacifiCare, Supplier shall, for a period of up to two (2) years
from the effective date of such divestiture, at PacifiCare's request, continue
to provide the Services to such divested PacifiCare entity or business unit at
the applicable Fees then in effect. The applicable Fees attributable to that
portion of the Services of such divested PacifiCare entity or business unit
shall be paid to Supplier, at PacifiCare's discretion, by the successor entity
owning or controlling such divested entity or business unit and the same amount
shall be deducted for the Fees payable by PacifiCare to Supplier.

         30.3     ASSIGNMENT OF CLAIMS. PacifiCare agrees that any and all
claims against Supplier arising from this Agreement shall be brought solely by
PacifiCare and that the other PacifiCare Entities shall assign such claims to
PacifiCare.

         30.4     BANKRUPTCY. The Parties acknowledge and agree that this
Agreement constitutes a license of an intellectual property right by Supplier to
the PacifiCare Entities as such term is used in Section 365(n) of Title 11 of
the United States Code.

         30.5     CONFLICT OF INTEREST. Neither Party shall pay any salaries,
commissions, fees or make any payments or rebates to any employee of the other,
or to any designee of such employee, or favor any employee of the other, or any
designee of such employee, with gifts or

                                       48
<PAGE>
entertainment of significant cost or value or with services or goods sold at
less than full market value. Supplier agrees that its obligation to the
PacifiCare Entities under this Section 30.5 shall also be binding upon Supplier
Agents. Supplier further agrees to insert the provisions of this Section 30.5 in
each contract with a Supplier Agent.

         30.6     CONSENTS, APPROVALS AND REQUESTS. Except as specifically set
forth in this Agreement, all consents and approvals to be given by either Party
under this Agreement shall not be unreasonably withheld or delayed and each
Party shall make only reasonable requests under this Agreement.

         30.7     CORPORATE INTEGRITY. Supplier acknowledges that PacifiCare
operates under a compliance program known as the "PACIFICARE ETHICS AND
INTEGRITY PROGRAM." Supplier further acknowledges that, notwithstanding anything
contained herein, PacifiCare shall not be required to engage in any conduct that
may violate any policies, procedures or directives of the PacifiCare Ethics and
Integrity Program or its Medical Confidential Information Laws-related policies
and procedures. Supplier further represents that it neither has been, nor
currently is, excluded from participation in government funded healthcare
programs, including Medicare, Medicaid, CHAMPUS and FEHP.

         30.8     COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one single agreement between the Parties.

         30.9     COVENANT OF FURTHER ASSURANCES. PacifiCare and Supplier
covenant and agree that, subsequent to the execution and delivery of this
Agreement and without any additional consideration, each of PacifiCare and
Supplier shall execute and deliver any further legal instruments and perform any
acts that are or may become necessary to effectuate the purposes of this
Agreement.

         30.10    ENTIRE AGREEMENT. This Agreement and the Schedules and
Exhibits to this Agreement represent the entire agreement between the Parties
with respect to its subject matter, and there are no other representations,
understandings or agreements between the Parties relative to such subject
matter. Notwithstanding the foregoing, neither PacifiCare nor Supplier shall be
relieved of any of its respective obligations with regard to any information
subject to the terms of any confidentiality agreement executed between
PacifiCare and Supplier prior to the Effective Date.

         30.11    EXPORT. Supplier shall not knowingly export or re-export any
personal computer system, part, technical data or sub-elements under this
Agreement, directly or indirectly, to any destinations prohibited by the United
States Government. The term "technical data" in this context, means such data as
is defined as technical data by applicable United States export regulations.

         30.12    GOOD FAITH AND FAIR DEALING. PacifiCare and Supplier
acknowledge and agree that all aspects of the business relationship and dealings
between PacifiCare and Supplier contemplated by this Agreement, including the
performance of all obligations and the exercise of

                                       49
<PAGE>
all rights hereunder, shall be governed by the fundamental principle of good
faith and fair dealing.

         30.13    GOVERNING LAW AND VENUE. The rights and obligations of the
parties under this Agreement shall be governed in all respects by the laws of
the State of [...***...] exclusively, as such laws apply to contracts between
[...***...] residents performed entiRElY within [...***...]. Supplier agrees
that it shall only bring any action or proceeding arising from or relating to
this Agreement in a federal court in the [...***...] or in state court in
[...***...], and Supplier irrevocably submits to the personal jurisdictioN aND
VENUE of any such court in any such action or proceeding or in any action or
proceeding brought in such courts by PacifiCare.

         30.14    NOTICES. Except as otherwise specified in this Agreement, all
notices, requests, consents, approvals, agreements, authorizations,
acknowledgements, waivers and other communications required or permitted under
this Agreement shall be in writing. Wherever under this Agreement one Party is
required to give notice to the other, such notice shall be deemed effective: (a)
five (5) calendar days after deposit in the United States Mail, postage prepaid,
certified or registered mail, return receipt requested; (b) three (3) calendar
days after deposit with a national overnight courier; (c) if given by telex,
telegraph or facsimile, one (1) day after transmission, provided confirmation of
such notice is also sent by national overnight courier or delivered in person;
or (d) upon delivery if delivered in person or by messenger, in each case,
addressed to the following addresses (or such other address as either party may
be notified of as described above):

         To PacifiCare:      PacifiCare Health Systems, Inc.
                             3120 W. Lake Center Drive
                             Santa Ana, California  92704-6917
                             Attention - Chief Information Officer;

         With copies to:     PacifiCare Health Systems, Inc.
                             3120 W. Lake Center Drive
                             Santa Ana, California  92704-6917
                             Attention - Chief Financial Officer;

                             Konowiecki & Rank LLP 350 South Grand
                             Avenue, Suite 2100 Los Angeles, CA 90071
                             Attention - Joseph Konowiecki, Esq.;

                             Cooley Godward LLP

                             Five Palo Alto Square, 3000 El Camino Real
                             Palo Alto, CA 94306
                             Attention - Daniel R. Mummery, Esq.;

         To Supplier:        ______________________________

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       50
<PAGE>
                             ______________________________
                             ______________________________
                             Attention - [Title of Officer];

         With copies to:     ______________________________
                             ______________________________
                             ______________________________
                             Attention - [Title of Officer];

                             ______________________________
                             ______________________________
                             ______________________________
                             Attention - [Outside Counsel];

         Supplier shall also provide a copy of any notice provided by Supplier
to PacifiCare pursuant to Section 7.3 to the following individual (or his or her
successor, as specified by PacifiCare):

                             Attention - Sharon Hulbert

                             Director of Ethics and Legal Operations
                             PacifiCare Health Systems, Inc.
                             M.S. LCO1-307, 3120 Lake Center Drive
                             Santa Anna, CA 92704

         Either Party may change its address or telecopy number for notification
purposes by giving the other Party ten (10) days notice of the new address or
telecopy number and the date upon which it shall become effective.

         30.15    PUBLICITY. Each Party shall (a) submit to the other all
advertising, written sales promotions, press releases and other publicity
matters relating to this Agreement in which the other Party's name or mark is
mentioned or that contain language from which the connection of said name or
mark may be inferred or implied and (b) not publish or use such advertising,
sales promotions, press releases or publicity matters without the other Party's
consent.

         30.16    RELATIONSHIP. The Parties intend to create an independent
contractor relationship and nothing contained in this Agreement shall be
construed to make either the PacifiCare Entities or Supplier partners, joint
venturers, principals, agents (except as expressly set forth in Section 7) or
employees of the other. No officer, director, employee, agent, affiliate or
contractor retained by Supplier to perform work on the PacifiCare Entities'
behalf under this Agreement shall be deemed to be an employee, agent or
contractor of the PacifiCare Entities. Neither Party shall have any right, power
or authority, express or implied, to bind the other.

         30.17    SEVERABILITY. If any provision of this Agreement is held by a
court of competent jurisdiction to be contrary to Law, then the remaining
provisions of this Agreement, if capable of substantial performance, shall
remain in full force and effect.
<PAGE>
         30.18    SURVIVAL. The terms of Section 14, Section 15, Section 17.7,
Section 18, Section 19.3, Section 19.4, Section 19.5, Section 20, Section 21,
Section 23, Section 26, Section 27, Section 28 and Section 30 shall survive the
expiration or termination of this Agreement.

         30.19    THIRD PARTY BENEFICIARIES. Each Party intends that this
Agreement shall not benefit, or create any right or cause of action in or on
behalf of, any person or entity other than the Parties and the PacifiCare
Entities.

         30.20    CUMULATIVE REMEDIES. No right or remedy herein conferred upon
or reserved to either Party is intended to be exclusive of any other right or
remedy, and each and every right and remedy shall be cumulative and in addition
to any other right or remedy under this Agreement, or under applicable Law,
whether now or hereafter existing, provided that through the exercise of its
rights and remedies under this Agreement a Party shall not be entitled to any
financial recovery that is duplicative of any other financial recovery
hereunder.

         30.21    WAIVERS. No delay or omission by either Party to exercise any
right or power it has under this Agreement shall impair or be construed as a
waiver of such right or power. A waiver by any Party of any breach or covenant
shall not be construed to be a waiver of any succeeding breach or any other
covenant. All waivers must be signed by the Party waiving its rights.
<PAGE>
         IN WITNESS WHEREOF, each of PacifiCare and Supplier has caused this
Agreement to be executed and delivered by its duly authorized representative.

                                   PACIFICARE HEALTH SYSTEMS, INC.

                                   By:    /s/  Maria Fitzpatrick
                                        ----------------------------------------
                                        Name:  Maria Fitzpatrick
                                        Title: Senior Vice President/Chief
                                               Information Officer

                                   By:    /s/  Bary Bailey
                                        ----------------------------------------
                                        Name:  Bary Bailey
                                        Title: Executive Vice President/Chief
                                               Strategic Officer

                                   INTERNATIONAL BUSINESS MACHINES CORPORATION

                                   By:    /s/  Roland S. Harris, III
                                        ----------------------------------------
                                        Name:  Roland S. Harris, III
                                        Title: General Manager, Public Sector,
                                               IBM Global Services
<PAGE>
                         TABLE OF EXHIBITS AND SCHEDULES

Exhibit A     Definitions
Exhibit B     Statement of Work
Exhibit C     PacifiCare Included Affiliates

<TABLE>
<S>                     <C>
Schedule 3.1(b)(i)      Affected Contractors
Schedule 3.1(b)(ii)     Affected Employees
Schedule 3.5            Technical Architecture and Product Standards Procedures
Schedule 3.8(a)         Promissory Note
Schedule 3.8(b)         Form of General Assignment and Bill of Sale
Schedule 3.9(b)         Reports
Schedule 4.1            Transition Plan
Schedule 4.2            Critical Transition Milestones
Schedule 6.3(a)         PacifiCare Regulations
Schedule 7.1            Assigned Agreements
Schedule 7.2            Managed Agreements
Schedule 8              Service Levels and Service Level Credits
Schedule 8.7            Service Levels that Trigger Termination Rights
Schedule 9.2(a)         Approved Benchmark Providers
Schedule 10.1           Service Locations
Schedule 10.2           Safety and Security Procedures
Schedule 11             Human Resources Provisions
Schedule 12.2           Key Personnel
Schedule 12.4           Approved Subcontractors
Schedule 13.2           Oversight and Management Process
Schedule 13.3           Policy & Procedures Manual
Schedule 14.2(a)        PacifiCare Proprietary Software
Schedule 14.2(b)        PacifiCare Third Party Software
Schedule 14.3           Supplier Software
Schedule 16.1           Disaster Recovery Plan(s) and Critical Services
Schedule 17             Fees
Schedule 17.15          Funds Transfer Information
Schedule 24.4           Failure to Provide Critical Services
Schedule 26.1           Termination Assistance Services
</TABLE>
<PAGE>
                                    EXHIBIT A

                                   DEFINITIONS

         "ADDITIONAL RESOURCE CHARGES" OR "ARC" means the resource charges for
the use of Services above the resource baselines as set forth in Schedule 17.

         "AFFECTED CONTRACTORS" means those PacifiCare contractors identified in
Schedule 3.1(b)(i).

         "AFFECTED EMPLOYEES" means those PacifiCare employees identified in
Schedule 3.1(b)(ii).

         "AGREEMENT" means this Information Technology Services Agreement
between PacifiCare and Supplier, including all schedules and exhibits attached
hereto.

         "ANNUAL PLAN" means the plan described in Section 3.9(a)(iii).

         "ASSETS" means the assets described in Schedule 3.8(b).

         "ASSIGNED AGREEMENTS" means the third party agreements that are
assigned, in whole or in part, to Supplier and that are set forth in Schedule
7.1.

         "BACK-END CONSENTS" means all third party licenses, approvals, permits,
consents and authorizations that are necessary to allow: (a) the PacifiCare
Entities and PacifiCare Entity Agents (i) to use the Supplier Third Party
Software and Supplier third party Tools, (ii) to use the Supplier Equipment to
the extent that PacifiCare acquires such Equipment, (iii) to use any assets
owned or leased by Supplier or Supplier's Agents and used solely to perform the
Services to the extent that PacifiCare acquires such assets, and (iv) to assign
any contracts with respect to third party services used by Supplier or Supplier
Agents to provide the Services to the extent requested by PacifiCare (and to the
extent Supplier to obtain such assignments using all reasonable efforts), in
each case for PacifiCare's use after the expiration of termination of this
Agreement; and (b) Supplier and Supplier Agents to assign to PacifiCare the Work
Product.

         "BACKGROUND TECHNOLOGY" of a Party means all algorithms, designs,
drawings, formula, know-how, protectable business methods, inventions, software,
materials, works of authorship, tools, and other technology that (a) is owned by
such Party and is in existence in electronic or written form on or prior to the
Effective Date or (b) is developed, acquired or licensed by such Party after the
Effective Date independently of the work undertaken pursuant to this Agreement.

         "BASE FEES" means the fees for the Base Services.

         "BASE SERVICE LEVELS" means the service levels and standards (both
initial and final) for the performance of the Base Services as described in, or
determined in accordance with, Schedule 8.
..
         "BASE SERVICES" has the meaning specified in Section 3.1.

                                       1
<PAGE>
         "BENCHMARKER" has the meaning specified in Section 9.2(a).

         "BENCHMARK PROCESS" means the objective measurement and comparison
process established by the Parties utilizing baselines, standards and
normalization factors agreed by PacifiCare and Supplier.

         "BUSINESS ASSOCIATE" has the meaning given in HIPAA.

         "CHANGE(S)" means any change to (a) the Services, (b) the Software used
to provide the Services or (c) the Equipment used to provide the Services, that
would materially alter the functionality, performance standards or technical
environment of the Software used to provide the Services or the Equipment used
to provide the Services, the provision of the Services, the Service Levels, the
composition of the Services, or the cost to PacifiCare of the Services.

         "CHANGE CONTROL PROCEDURES" has the meaning specified in Section 13.4.

         "CHANGE IN CONTROL" means any event or series of events that results
directly or indirectly in a change in the management or Control of a Party.
Without limiting the generality of the foregoing, each of the following shall be
considered a Change in Control: (a) the consolidation or merger of a Party with
or into any entity; (b) the sale, transfer or other disposition of all or
substantially all of the assets of a Party; (c) any change in the beneficial
ownership of [...***...] or more (or such lesser percentage that constitutes
Control) of the outstanding voting securities or other ownership interests of a
Party; or (d) the resignation, removal appointment or election of a majority of
the members of a Party's board of directors or management team within a
[...***...].

         "CONFIDENTIAL INFORMATION" of the PacifiCare Entities or Supplier means
all information and documentation of the PacifiCare Entities and Supplier,
respectively, whether disclosed to or accessed by the PacifiCare Entities or
Supplier in connection with this Agreement, including (a) with respect to the
PacifiCare Entities, all PacifiCare Data and all information of the PacifiCare
Entities or their respective customers, suppliers, contractors and other third
parties doing business with the PacifiCare Entities, (b) with respect to the
PacifiCare Entities all IIHI, PHI and all other data and information of or
relating to patients, (c) with respect to the PacifiCare Entities and Supplier,
the terms of this Agreement and (d) any information developed by reference to or
use of the PacifiCare Entities' or Supplier's Confidential Information;
provided, however, that except to the extent otherwise provided by Law, the term
"Confidential Information" shall not include information that (w) is already
known by the recipient at the time of disclosure (other than through
unauthorized disclosure), as demonstrated by the recipient's written records,
and the recipient has no obligation of confidentiality other than pursuant to
this Agreement or any confidentiality agreements between the PacifiCare Entities
and Supplier entered into before the Effective Date, (x) is independently
developed by the recipient, as demonstrated by the recipient's written records,
without violating the disclosing Party's proprietary rights, (y) is or becomes
publicly known (other than through unauthorized disclosure) or (z) is rightfully
received by a Party free of any obligation of confidentiality.

         "CONSENTS" means the Front-End Consents and the Back-End Consents,
collectively.

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       2
<PAGE>
         "CONTRACT YEAR" means each twelve- (12)-month period commencing, in the
case of the first Contract Year, on the Effective Date and thereafter upon the
completion of the immediately preceding Contract Year.

         "CONTROL" means, with respect to any entity, the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such entity, whether through the ownership of voting securities
(or other ownership interest), by contract or otherwise.

         "COVERED ENTITY" has the meaning given in HIPAA.

         "CRITICAL SERVICES" means those services described as Critical Services
in Schedule 16.1.

         "CRITICAL TRANSITION MILESTONE" means a milestone specified in Schedule
4.2.

         "CUTOVER DATE" means [...***...].

         "DATA SAFEGUARDS" means the data safeguards specified in Section 10.2.

         "DEFAULT CURE PERIOD" means the PacifiCare Default Cure Period or the
Supplier Default Cure Period, as applicable.

         "DEFAULT NOTICE" means the PacifiCare Default Notice or the Supplier
Default Notice, as applicable.

         "DISPUTE" has the meaning specified in Section 23.1.

         "DMHC FILING" has the meaning specified in Section 3.3(d).

         "DRP" means the disaster recovery plan described in Section 16.1.

         "EFFECTIVE DATE" means December 31, 2001.

         "END DATE" has the meaning specified in Section 26.3.

         "END-USER" means a user of the Services, as specified by PacifiCare.

         "EQUIPMENT" means computers and related equipment, including central
processing units and other processors, controllers, moderns, communications and
telecommunications equipment (voice, data and video), cables, storage devices,
printers, terminals, other peripherals and input and output devices, and other
tangible mechanical and electronic equipment intended for the processing, input,
output, storage, manipulation, communication, transmission and retrieval of
information and data.

         "EXTENSION PERIOD" has the meaning specified in Section 2.2(b).

         "FEES" means the Base Fees, the Additional Resource Charges and any
other amounts payable by PacifiCare to Supplier pursuant to this Agreement.

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       3
<PAGE>
         "FORCE MAJEURE EVENT" means a force majeure event as defined in Section
16.2.

         "FRONT-END CONSENTS" means all third party licenses, approvals,
permits, consents and authorizations that are necessary to allow: (i) Supplier
and Supplier Agents to use (1) the PacifiCare Entities' owned and leased assets,
(2) the services provided for the benefit of the PacifiCare Entities under
PacifiCare's third party services contracts (other than PacifiCare Third Party
Contracts), (3) the PacifiCare Software and PacifiCare Tools, (4) the Supplier
Software and Supplier Tools and (5) any assets owned or leased by Supplier and
used to provide the Services; (ii) PacifiCare to assign the Assigned Agreements
to Supplier pursuant to Section 7.1 and Supplier to manage and administer the
Managed Agreements pursuant to Section 7.2; (iii) Supplier and Supplier Agents
to use any third party services required by Supplier to provide the Services
during the Term and the Termination Assistance Period; and (iv) the PacifiCare
Entities and PacifiCare Entity Agents to use the Supplier Third Party Software
and Tools.

         "GOVERNMENTAL AUTHORITY" means any Federal, state, municipal, local,
territorial, or other governmental department, regulatory authority, judicial or
administrative body, whether domestic, foreign or international.

         "GOVERNMENTAL APPROVALS" means the PacifiCare Governmental Approvals
and the Supplier Governmental Approvals, collectively.

         "HIPAA" means the Health Care Insurance Portability and Accountability
Act of 1996, as amended and as may be further amended, including all rules and
regulations promulgated thereunder.

         "IIHI" has the meaning specified in HIPAA.

         "IMPROVED TECHNOLOGY" has the meaning specified in Section 3.2.

         "INDEMNIFIED PARTY" has the meaning specified in Section 27.3.

         "INDEMNIFYING PARTY" has the meaning specified in Section 27.3.

         "INITIAL TERM" has the meaning specified in Section 2.1.

         "INITIAL TERM EXPIRATION DATE" has the meaning specified in Section
2.1.

         "INTEREST" means the rate of interest announced by Citigroup Inc. at
its principal office in the United States as its prime commercial lending rate
plus [...***...], but in no event to exceed the highest lawful rate of interest.

         "KEANE" means Keane, Inc., which will provide service to PacifiCare in
accordance with the Keane Agreement.

         "KEANE AGREEMENT" means the agreement between PacifiCare and Keane of
even date herewith pursuant to which Keane will provide the Keane Services.

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       4
<PAGE>
         "KEANE SERVICES" means the application maintenance and enhancement
services that Keane will provide to the PacifiCare Entities in accordance with
the Keane Agreement.

         "KEY PERSONNEL" means the individuals or positions identified by
PacifiCare in Schedule 12.2, as such schedule is updated by PacifiCare from time
to time, including the Supplier Client Relationship Manager.

         "KEANE SUBCONTRACT" has the meaning specified in Section 13.2(b).

         "LAW" means any law, statute or other legislative enactment,
declaration, decree, directive, order, ordinance, regulation, rule or other
binding restriction of or by any Governmental Authority, including any Medical
Confidential Information Laws.

         "LOSSES" means any and all damages, fines, penalties, deficiencies,
losses, liabilities (including settlements and judgments) and expenses
(including interest, court costs, reasonable fees and expenses of attorneys,
accountants and other experts and professionals or other reasonable fees and
expenses of litigation or other proceedings or of any claim, default or
assessment).

         "MANAGED AGREEMENT INVOICE(S)" means any invoice submitted by third
parties in connection with the Managed Agreements.

         "MANAGED AGREEMENTS" means all agreements to be retained by PacifiCare,
but managed by Supplier, including those listed in Schedule 7.2.

         "MEDICAL CONFIDENTIAL INFORMATION LAWS" means all Laws applicable to
the provision of healthcare services (including mental health services),
including HIPAA and all Laws governing medical confidentiality, including
disclosure of AIDS or human immunodeficiency virus-related information.

         "NEW EQUIPMENT" means any Equipment or Software obtained by Supplier on
behalf of PacifiCare, as requested by PacifiCare pursuant to Section 3.7.

         "NEW SERVICES" means any service that is outside of the scope of the
Base Services.

         "NEW SERVICES SERVICE LEVELS" means the service levels applicable to
New Services.

         "OPERATION AGREEMENT" has the meaning specified in Section 13.2(a).

         "PACIFICARE AGENTS" means the agents, subcontractors and
representatives of PacifiCare, other than Supplier and Supplier Agents.

         "PACIFICARE DATA" means (a) any data and information that is provided
or submitted to Supplier or Supplier Agents by or on behalf of the PacifiCare
Entities or the PacifiCare Entities' respective health-care providers, clients
or patients, (b) any data and information regarding the PacifiCare Entities or
the PacifiCare Entities' health-care providers, clients or patients that is
obtained, generated, developed, collected, processed or produced by Supplier or
Supplier Agents in connection with this Agreement, (c) any data and information
regarding the PacifiCare

                                       5
<PAGE>
Entities or the PacifiCare Entities' suppliers, clients or patients to which
Supplier or Supplier Agents have access in connection with the provision of the
Services and (d) any derivatives of subsections (a)-(c) of this definition.
PacifiCare Data includes reports, service level data, patterns of service
requirements and other data and information with respect to the businesses,
operations, facilities, health-care providers, clients, patients, products,
services, assets and finances of the PacifiCare Entities, or their respective
suppliers, clients or patients.

         "PACIFICARE DEFAULT CURE PERIOD" has the meaning specified in Section
24.3.

         "PACIFICARE DEFAULT NOTICE" has the meaning specified in Section 24.3.

         "PACIFICARE ENTITIES" means PacifiCare and the PacifiCare Included
Affiliates, collectively.

         "PACIFICARE ENTITY AGENTS" means agents, subcontractors and
representatives of the PacifiCare Entities, other than Supplier and Supplier
Agents.

         "PACIFICARE ESTIMATED BASELINE REQUIREMENTS" has the meaning specified
in Section 3.9(a)(i).

         "PACIFICARE INCLUDED AFFILIATES" means any person, firm, corporation,
partnership, associate, or other entity bound by the terms of this Agreement and
who (a) is Controlling, Controlled by or under common Control with PacifiCare,
(b) is managed or operated by PacifiCare, (c) is owned through stock ownership
or membership interest, in whole or in part, by a shareholder or member of
PacifiCare or (d) is listed as an affiliate of PacifiCare on Exhibit C, as the
same may be updated from time to time by PacifiCare.

         "PACIFICARE PROPRIETARY SOFTWARE" means the Software provided to
Supplier by PacifiCare under this Agreement, including the Software set forth in
Schedule 14.2(a), and Related Documentation, that is owned, acquired or
developed by PacifiCare and used in connection with the provision of the
Services, including any modifications, enhancements, or derivative works
thereof, but specifically excluding PacifiCare Third Party Software.

         "PACIFICARE SERVICE LOCATION(S)" means any PacifiCare service location
set forth in Schedule 10.1 and any other service location owned or leased by
PacifiCare from which Supplier has been authorized by PacifiCare to provide the
Services.

         "PACIFICARE SOFTWARE" means the PacifiCare Proprietary Software and the
PacifiCare Third Party Software.

         "PACIFICARE SUPPLIER RELATIONSHIP MANAGER" has the meaning specified in
Section 6.1.

         "PACIFICARE THIRD PARTY CONTRACTS" means the Managed Agreements and the
Assigned Agreements, collectively.

         "PACIFICARE THIRD PARTY SOFTWARE" means the Software set forth in
Schedule 14.2(b), and Related Documentation, that is licensed or leased to
PacifiCare from a third party and used in connection with the provision of the
Services.

                                       6
<PAGE>
         "PARTIES" means PacifiCare and Supplier, collectively.

         "PARTY" means either PacifiCare or Supplier, as the case may be.

         "PERMITTED LIENS" means i) liens for current taxes not yet due and
payable or delinquent or that are being contested in good faith by appropriate
proceedings or that are not material; (ii) imperfections or irregularities in
title, if any, that have arisen in the ordinary course of business or consistent
with past practice and that individually or in the aggregate are not material or
that could not materially affect Supplier's use of the Assets; (iii) statutory
or common law liens in favor of carriers, warehousemen, mechanics and
materialmen, to secure claims for labor, materials or supplies and other like
liens; and (iv) deposits or pledges made in connection with, or to secure
payment of, workers' compensation, unemployment insurance, old age pension or
other social security programs mandated by applicable Law.

         "PRECLUDED PERFORMANCE EVENT" means a prevention, hindrance or delay in
performance of the Services caused by Supplier's failure to perform its
obligations under Section 21.2(e), Section 21.2(f), Section 22.2(c), or Section
27.2(e).

         "PRIVILEGED WORK PRODUCT" has the meaning specified in Section 20.3.

         "POLICY & PROCEDURES MANUAL" means a listing of policies and procedures
that governs the delivery and receipt of the Services and that is based on the
outline set forth in Schedule 13.3.

         "PROGRAM OFFICE" has the meaning specified in Section 13.2(a)(i).

         "PROJECT STAFF" means the personnel of Supplier and Supplier Agents who
provide the Services.

         "PROTECTED HEALTH INFORMATION" or "PHI" has the meaning given in HIPAA.

         "REDUCED RESOURCE CREDITS" OR "RRC" means the credits in the amounts
equal to the Additional Resource Charges specified in Schedule 17 for the use of
Services below the resource baselines set forth in Schedule 17.

         "REGULATORY REQUIREMENTS" means the Laws to which the PacifiCare
Entities are required to submit or voluntarily submit from time to time.

         "RELATED DOCUMENTATION" means, with respect to Software and Tools, all
materials, documentation, specifications, technical manuals, user manuals, flow
diagrams, file descriptions and other written information that describes the
function and use of such Software or Tools, as applicable.

         "SERVICE LEVEL CREDITS" means the performance credits set forth in
Schedule 8.

         "SERVICE LEVELS" means the Base Service Levels and the New Services
Service Levels, collectively.

                                       7
<PAGE>
         "SERVICE LOCATION(S)" means any PacifiCare Service Location or Supplier
Service Location, as applicable.

         "SERVICES" means, collectively, the Base Services, the New Services
being provided by Supplier pursuant to this Agreement, and, during the
Termination Assistance Period, the Termination Assistance Services.

         "SOFTWARE" means the object code versions of any applications programs,
operating system software, computer software languages, utilities, other
computer programs and Related Documentation, in whatever form or media,
including the tangible media upon which such applications programs, operating
system software, computer software languages, utilities, other computer programs
and Related Documentation are recorded or printed, together with all
corrections, improvements, updates and releases thereof.

         "STEERING COMMITTEE" has the meaning specified in Section 13.1.

         "SUPPLIER AGENTS" means the agents, subcontractors and representatives
of Supplier.

         "SUPPLIER CLIENT RELATIONSHIP MANAGER" has the meaning specified in
Section 12.1.

         "SUPPLIER DEFAULT CURE PERIOD" means the Supplier default cure period
defined in Section 24.3.

         "SUPPLIER DEFAULT NOTICE" means the means the Supplier default notice
defined in Section 24.4.

         "SUPPLIER EQUIPMENT" means that Equipment leased or owned by Supplier
and Supplier Agents that are used by Supplier and Supplier Agents to provide the
Services.

         "SUPPLIER PROPRIETARY SOFTWARE" means the Software, including the
Software set forth in Schedule 14.3, and Related Documentation owned, acquired
or developed by or on behalf of Supplier and used in connection with the
Services, including any modifications, enhancements, or derivative works of such
Software, but specifically excluding any PacifiCare Software, Supplier Third
Party Software.

         "SUPPLIER'S REPLY" has the meaning specified in Section 3.9.

         "SUPPLIER SERVICE LOCATION(S)" means any Supplier service location set
forth in Schedule 10.1 and any other service location owned or leased by
Supplier from which Supplier has been authorized by PacifiCare to provide the
Services.

         "SUPPLIER SOFTWARE" means the Supplier Proprietary Software and the
Supplier Third Party Software, collectively, of which a current list is attached
hereto as Schedule 14.3.

         "SUPPLIER THIRD PARTY SOFTWARE" means the Software and Related
Documentation licensed, leased or otherwise obtained by Supplier from a third
party that is used in connection with the Services.

                                       8
<PAGE>
         "SYSTEMS" means the Software and the Equipment, collectively, used to
provide the Services.

         "TERM" has the meaning specified in Section 2.2.

         "TERMINATION ASSISTANCE PERIOD" has the meaning specified in Section
26.1(b).

         "TERMINATION ASSISTANCE SERVICES" has the meaning specified in Section
26.1(a).

         "TOOLS" means any Software development and performance testing tools,
know-how, methodologies, processes, technologies or algorithms and Related
Documentation used by Supplier in providing the Services.

         "TOWER" has the meaning specified in Exhibit B (Statement of Work), as
such exhibit is modified or amended by the Parties during the Term.

         "TRANSITION PERIOD" has the meaning specified in Section 4.1.

         "TRANSITIONED PERSONNEL" has the meaning specified in Section 11.

         "TRANSITION PLAN" means the transition plan set forth in Schedule 4.1.

         "TRANSITION SERVICES" has the meaning specified in Section 4.1.

         "VARIABLE FEE REPORT" means the detailed invoice provided to PacifiCare
by Supplier on a monthly basis describing the Variable Fees incurred by
PacifiCare and Supplier during the preceding month.

         "VARIABLE FEES" means the Additional Resource Charges and the Reduced
Resource Credits, collectively.

         "WIND DOWN COSTS" means costs and expenses incurred by Supplier solely
as a result of PacifiCare's election to terminate this Agreement as specified in
Section 4.2, Section 9.2(c) or Section 16.3, or to Insource as specified in
Section 3.10, which costs and expenses are specified on an invoice in a
reasonable level of detail acceptable to PacifiCare, and which costs are limited
to: i) Supplier's actual cost to relocate or provide standard Supplier
relocation expenses or severance to Supplier personnel who are dedicated solely
to providing the Services and who must be relocated or dismissed from employment
solely as a result of PacifiCare's termination of the Agreement, provided that
Supplier uses all reasonable efforts to avoid relocating or dismissing such
personnel, ii) Supplier's actual cost of terminating contracts (including
licenses and service contracts) that must be terminated solely as a result of
PacifiCare's termination of this Agreement, provided that Supplier uses all
reasonable efforts to avoid terminating such contracts, and iii) Supplier's
actual cost of disposing of tangible assets owned or leased by Supplier that are
used solely to provide the Services, provided that Supplier uses all reasonable
efforts to re-deploy such assets within Supplier's organization or sell such
assets at fair market value. Wind Down Costs exclude the cost of any Equipment
purchased by PacifiCare from Supplier in connection with the termination of this
Agreement, costs related to any Supplier personnel hired by PacifiCare in
connection with the termination of this Agreement, as well as

                                       9
<PAGE>
any costs described above that Supplier could have eliminated or reduced given
the amount of notice Supplier received of the applicable termination or
Insourcing event or other relevant circumstances, either through the measures
described above or by using other good faith efforts to mitigate such costs.

         "WORK PRODUCT" means literary works or other works of authorship
created under this Agreement, including manuals, training materials and
documentation, but excluding Software, Related Documentation, and the Policy and
Procedures Manual.

                                       10
<PAGE>
                                    EXHIBIT B
<PAGE>
                  PACIFICARE AND IBM-GLOBAL SERVICES AGREEMENT

================================================================================
                               STATEMENT OF WORK -
                                 INFRASTRUCTURE
================================================================================

                                    EXHIBIT B

                                [PACIFICARE LOGO]
<PAGE>
<TABLE>
<S>                                                                                                    <C>
I.    Detailed Statement of Work:....................................................................    1
      A.       General Provisions:...................................................................    1
      B.       Data Center (Midrange):...............................................................    3
               1.       General:.....................................................................    3
               2.       Operations:..................................................................    3
               3.       Production Control and Scheduling:...........................................    6
               4.       Operation Support for New Services:..........................................    8
               5.       External Storage Media Operations and Administration:........................   10
               6.       Off-Site Media Storage:......................................................   13
               7.       Equipment Maintenance and Support:...........................................   14
               8.       Data Center Planning and Operations:.........................................   15
               9.       Enterprise Storage Subsystem Management:.....................................   17
               10.      End-User Support:............................................................   20
               11.      Administration:..............................................................   21
               12.      Software Currency, Refresh, and Release Control:.............................   24
               13.      Back-up and Recovery Services:...............................................   26
               14.      Hours of Operation:..........................................................   28
               15.      Physical Security Administration:............................................   29
               16.      License Management and Compliance:...........................................   33
               17.      Technical Support:...........................................................   33
               18.      Database Support and Management:.............................................   41
      C.       Network:..............................................................................   44
               1.       General:.....................................................................   44
               2.       Network Management:..........................................................   44
               3.       Network Operations:..........................................................   46
               4.       SNA, DECNet, and TCP/IP Technical Support:...................................   48
               5.       End-User Support:............................................................   49
               6.       Network Engineering:.........................................................   49
               7.       Network Control and Connectivity Responsibility:.............................   52
               8.       Network Provisioning:........................................................   53
               9.       Software Currency, Refresh, and Release Control:.............................   53
               10.      Regulatory Changes:..........................................................   55
               11.      Telecommunications Billing and Financial Administration:.....................   56
               12.      Toll / Line Charges:.........................................................   57
               13.      Premise Voice Systems:.......................................................   58
               14.      Wireless Telecommunication:..................................................   60
               15.      Audio and Videoconferencing:.................................................   61
               16.      Network Administration:......................................................   62
               17.      Toll Fraud:..................................................................   63
               18.      Phone Directories:...........................................................   64
               19.      Equipment Support:...........................................................   65
               20.      Electronic Data Interchange (EDI):...........................................   66
               21.      Circuit and Transport Costs:.................................................   67
               22.      Hours of Operation:..........................................................   67
      D.       Distributed Computing:................................................................   67
               1.       General:.....................................................................   67
</TABLE>

                                       i.
<PAGE>
<TABLE>
<S>                                                                                                    <C>
               2.       End-User Support:............................................................   67
               3.       Installation and Removal:....................................................   68
               4.       Infrastructure Maintenance:..................................................   69
               5.       Equipment Maintenance and Support:...........................................   70
               6.       Software Support:............................................................   72
               7.       Software Currency, Refresh, and Release Control:.............................   73
               8.       Operations Support for New Services:.........................................   74
               9.       Server Operations:...........................................................   75
               10.      Administration and Documentation:............................................   78
               11.      Disaster Recovery Services:..................................................   79
               12.      Media Operations and Administration:.........................................   79
               13.      Order Fulfillment:...........................................................   80
               14.      Technology (Equipment) Refresh:..............................................   80
               15.      Standard Equipment and Software:.............................................   81
               16.      Lab Testing:.................................................................   81
               17.      Spares Inventory:............................................................   82
      E.       Desktop...............................................................................   82
               1.       General:.....................................................................   82
               2.       End-User Support:............................................................   82
               3.       Installation and Removal:....................................................   84
               4.       Equipment Maintenance and Support:...........................................   85
               5.       Software Support:............................................................   86
               6.       Software Currency, Refresh, and Release Control:.............................   87
               7.       Operations Support for New Services:.........................................   89
               8.       Systems Management:..........................................................   89
               9.       Technology (Equipment) Refresh:..............................................   90
               10.      Standard Equipment and Software:.............................................   90
               11.      Lab Testing:.................................................................   91
               12.      Spares Inventory:............................................................   92
      F.       Customer Support Department (Help Desk)...............................................   92
               1.       Help Desk Support:...........................................................   92
               2.       Problem Management:..........................................................   97
      G.       Information Distribution Center.......................................................   98
               1.       Print and Media Operations:..................................................   98
               2.       Finishing Operations:........................................................  101
               3.       Account Management:..........................................................  103
               4.       Demand Print:................................................................  104
               5.       Mail Processing..............................................................  106
               6.       Admin Support Services.......................................................  108
               7.       Customer Service:............................................................  109
               8.       Strategic Initiatives and Support:...........................................  109
      H.       Cross Functional Services:............................................................  111
               1.       Change Management:...........................................................  111
               2.       Quality Assurance:...........................................................  113
               3.       Training and Education:......................................................  114
               4.       Project Support:.............................................................  115
</TABLE>

                                      ii.
<PAGE>
<TABLE>
<S>                                                                                                    <C>
               5.       Business Metrics:............................................................  116
               6.       New Technology and Automation:...............................................  116
               7.       Physical Security Administration:............................................  117
               8.       Logical Security Administration:.............................................  118
               9.       On-going Business Divestitures and Acquisitions:.............................  121
               10.      Consolidation and Relation Services..........................................  121
               11.      License Management and Compliance:...........................................  121
               12.      Installs, Moves, Adds, and Changes:..........................................  122
               13.      Crisis Management:...........................................................  122
               14.      Collaborative Application....................................................  122
               15.      Chargeback...................................................................  123
               16.      Effective Use of the Equipment...............................................  123
               17.      Redeployment and Disposal....................................................  124
               18.      Project Management...........................................................  124
               19.      Virus Protection.............................................................  124
               20.      PacificCare Ongoing Project as of Effective Date.............................  126
               21.      Reporting....................................................................  126
               22.      Meeting Between PacifiCare and Supplier......................................  126
               23.      Long-range Information Systems Plan and Equipment Software Architecture......  126
               24.      Potential Value Adds:........................................................  127
               25.      Disaster Recovery............................................................  129
               26.      Business Continuity Services:................................................  136
               27.      Asset Inventory Management and Maintenance:..................................  141
               28.      Operations Documentation:....................................................  143
               29.      Order Fulfillment:...........................................................  148
               30       Data Retention...............................................................  149
</TABLE>

                                      iii.
<PAGE>
I.       DETAILED STATEMENT OF WORK:

A.       GENERAL PROVISIONS:

         This Statement of Work, including any exhibits and attachments hereto
         (the "STATEMENT OF WORK"), is an exhibit to that certain Information
         Technology Services Agreement entered into and effective as of December
         31, 2001 by and between PacifiCare and Supplier (the "AGREEMENT").

         In the event of any conflict, confusion or ambiguity between this
         Schedule and the Agreement, the Agreement shall control.

         For the purposes of this Statement of Work, the term "PacifiCare" shall
         mean "PacifiCare Entities."Terms used herein with initial capital
         letters shall have the respective meanings set forth in the Agreement.
         Terms used herein with initial capital letters but not otherwise
         defined in the Agreement shall have the respective meanings set forth
         in Schedule 8 or other Exhibits and Schedules to the Agreement. In
         addition, the meanings for the following terms shall apply:

                  APPLICATION SUPPLIER shall mean the entity or entities which
         shall provide application system maintenance, enhancement and
         development services on behalf of PacifiCare. The Application Supplier
         may include PacifiCare or Keane.

                  BUSINESS CONTINUITY PLAN is defined in Section H. 26 (confirm
         with definition in the Service Level Schedule).

                  PACIFICARE CLIENT RELATIONSHIP MANAGER shall mean an
         individual or individuals appointed by PacifiCare who shall serve as
         the primary PacifiCare representative under this Agreement.

                  CORPORATE CRISIS shall mean a critical event, which if not
         handled in an appropriate manner, may dramatically impact on
         PacifiCare's staff, profitability, reputation or ability to operate.

                  EXECUTIVE SUPPORT shall mean customized service for a select
         set of End-Users ("Executive End-Users") which may include a different
         greeting than the rest of the End-User population, paging of
         appropriate Desktop support upon receipt of a call to the Help Desk,
         and call back to the Executive End-User to close the call and determine
         satisfaction of the Executive End-User. [...***...].

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       1.
<PAGE>
                  PERIPHERAL shall mean approved Standard monitors, keyboard and
         mouse associated with the Platform where applicable, that is refreshed,
         acquired and supported by Supplier. Peripherals that are supported by
         Supplier and are not subject to refresh include IOMega Zip and JAZZ
         drives, external/internal modems, external CDROM/CDRW drives, scanners,
         Palm/IPAQ devices, pager cradles and Blackberry devices.

                  PLATFORM shall mean a combination of approved Standard
         computer and communications Equipment and Software that Supplier is
         expected to refresh, acquire and support under the Agreement.
         [...***...]. The Peripherals, internal memory, hard drive size, and
         manufacture model number effects the quantity of Platforms.

                  PROBLEM MANAGEMENT shall mean the resolution and prevention of
         incidents that affect the normal running of PacifiCare's IT services.
         This includes ensuring that faults are corrected, preventing any
         recurrence of these faults, and the application of preventative
         maintenance to reduce the likelihood of these faults occurring in the
         first instance. The effective practice of Problem Management shall
         ensure that the availability of PacifiCare's IT services is maximized,
         and could also protect the integrity and confidentiality of information
         by identifying the root cause of a problem.

                  PROJECT MANAGEMENT shall mean a process defined by written
         project management procedures used by the Parties through which
         requested or suggested changes to Projects are controlled, which shall
         be set forth in the Policy and Procedures Manual.

                  QUALITY ASSURANCE shall mean the process used to ensure
         quality in the provision of the Services as further described in the
         Policy and Procedures Manual. Until such time as the Policy and
         Procedures Manual is complete, Quality Assurance shall mean that
         process used by PacifiCare as of the Effective Date of the Agreement,
         and in the case where there are no quality assurance processes in
         effect for a particular service as of the Effective Date, such quality
         assurance procedures as are standard in the relevant industry.

                  TOWER shall mean a logical set of services grouped around a
         particular function.

                  TRADING PARTNER shall mean external entities that are
         authorized to access PacifiCare networks and applications, including
         companies such as [...***...].

                  VIRUS shall mean any computer code having the effect of or
         designed to (a) disrupt, disable, harm or otherwise impede in any
         manner the proper operation of a computer program or computer system or
         (b) damage, destroy, hide or transmit any data residing on a computer
         or computer system without the appropriate End-User's consent.

         This SOW describes generally services, tasks, functions,
         responsibilities and projects that constitute the Base Services which
         Supplier must perform under the Agreement; this SOW does not describe
         in complete detail each action that is or may become necessary for
         Supplier to perform such services, tasks, functions, responsibilities
         and projects.

         The sections within this SOW entitled "Supplier's Solution Description"
         describe certain services, tasks, functions, responsibilities and
         projects to be performed by Supplier. For purposes of

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       2.
<PAGE>
         clarification, such descriptions add to, and do not replace, any of
         PacifiCare's Functional Requirements, and Supplier is in no way
         relieved from meeting or fulfilling such Functional Requirements to the
         extent a particular Supplier's Solution Description omits any action
         necessary to fulfill such Functional Requirements.

B.       DATA CENTER (MIDRANGE):

1.       GENERAL:

                  As of the Cutover Date, Supplier shall assume responsibility
         for the operation, management and support of PacifiCare's Corporate and
         Regional Data Center environment including Equipment of the types
         described in Schedule 3.8(a) Transferred Assets.

                  Supplier shall work with PacifiCare to minimize the number of
         Midrange processors [...***...], and to consolidate them or take other
         actions to run the Midrange environment as efficiently as is
         technically and commercially feasible, considering business needs of
         PacifiCare. Supplier must demonstrate its reasonable efforts to
         maximize Midrange Equipment efficiencies before PacifiCare approves any
         additional Midrange processors.

2.       OPERATIONS:

                  SUPPLIER'S SOLUTION DESCRIPTION:MASTER CONSOLE FUNCTIONS

                  AUTOMATION OF CONSOLE FUNCTIONS AND ANY PROCESSES, OR
         PROCEDURES IN USE: Supplier shall use existing PacifiCare processes,
         procedures, and tools in order to maintain continuity of service within
         the PacifiCare environment. Supplier shall review, supplement, and
         replace existing procedures with established Supplier procedures where
         there shall be a benefit for PacifiCare. For servers that are located
         in facilities that are not in the same physical locations as operations
         staff, Supplier shall utilize remote control tools.

                  SYSTEMS PERFORMANCE (MONITOR AND MAINTENANCE): Supplier shall
         analyze PacifiCare's existing tool sets and the functions they provide
         to the service being delivered and implement proven Supplier tools,
         which shall provide increased functionality and meet PacifiCare's
         needs. Supplier shall provide PacifiCare with the best suited tool set
         regardless of vendor. [...***...]. For most midrange platforms,
         Supplier shall deploy the Server Resource Manager toolset to monitor
         system resource consumption and monitor the performance of those
         systems on that basis. [...***...].

                  ALARM SYSTEMS AND ENVIRONMENTAL MALFUNCTIONS: Supplier shall
         augment PacifiCare's existing tools with Supplier's tool set to provide
         central monitoring of alerts and pro-active procedures to streamline
         and expedite problem determination and resolution. Supplier shall use
         existing PacifiCare processes, procedures, and tools to monitor and
         react to alarm systems and environmental malfunctions, installing new,
         or replacing tools during the Transition Period. In PacifiCare Service
         Locations, as well as in Supplier Service Locations, regardless of
         whether or not computer operators monitor the alarms directly, or if
         monitoring is performed by the facilities

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       3.
<PAGE>
         management group(s) and contracted to security, [...***...].

                  TRANSMISSION AND RECEPTION OF POLLING INFORMATION FROM OUTSIDE
         ORGANIZATIONS: Supplier shall use existing PacifiCare processes,
         procedures, and tools to monitor the transmission and reception of
         polling information from outside organizations; augmenting this with
         proven Supplier tools during the Transition Period, Term and
         Termination Assistance Period.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier responsibilities to perform processing operations
         Services on the data center Equipment shall include the following:

                  a.       Issue network operator commands, display, start,
                           stop, restart and reset devices and lines.

                  b.       Assume the responsibility for and perform all console
                           operations, including monitoring all PacifiCare
                           processing within PacifiCare's data center
                           environment, alarm systems and environmental controls
                           at the PacifiCare data center, and transmission and
                           reception of polling information from outside
                           organizations.

                  c.       Monitor performance of on-line interactive traffic
                           and take appropriate action to resolve on-line
                           system-related problems consistent with the Problem
                           Management process, including escalating, as
                           appropriate, the problem to the proper second level
                           support group. Monitor transmission of files between
                           PacifiCare Service Locations and other parties as
                           designated by PacifiCare.

                  d.       Manage, maintain, monitor, and control on-line and
                           batch process, both scheduled and unscheduled
                           (including a reasonable amount of on-request
                           processing, provided that PacifiCare gives Supplier
                           reasonable notice). [...***...]. The data shall be
                           usEd to formulate a recommendation to alleviate
                           bottlenecks and improve the production run times.
                           Recommended changes shall be implemented through the
                           Change Management Procedures.

                  e.       Complete PacifiCare-defined batch processing and
                           backups in the correct sequence and within the time
                           periods designated by PacifiCare.

                  f.       Maintain an emergency contact list and escalation
                           procedures to resolve system/application failures.

                  g.       Assess impact of system/application failures on
                           End-Users and report assessment to both the affected
                           End-Users and appropriate PacifiCare

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       4.
<PAGE>
                           Client Relationship Manager, take appropriate
                           corrective action and perform job restarts in
                           accordance with operational procedures.

                  h.       On an ongoing basis, enhance processing capabilities
                           and efficiencies through system tuning and other run
                           time improvements. Supplier shall perform regular
                           monitoring of utilization needs and efficiencies and
                           report on tuning initiatives regularly.

                  i.       Perform ID assignment.

                  j.       Perform proactive failure trend analysis.

                  k.       Perform load balancing.

                  l.       Where practicable, provide for automated scheduling
                           of batch work and processes including backups.

                  m.       Coordinate and process special processing requests.

                  n.       Schedule batch jobs to achieve maximum performance as
                           long as requested batch completion times are met.

                  o.       Produce trend reports to highlight production
                           problems, and establish predetermined action and
                           escalation procedures when batch window problems are
                           encountered.

                  p.       Monitor, verify and make appropriate adjustments to
                           support proper applications executions. Notify
                           PacifiCare in accordance with the notification
                           procedures set forth in Section F, Customer Support
                           Department (Help Desk), Problem Management process
                           and the Policy and Procedures Manual, in the event
                           that applications do not execute properly.

                  q.       Perform weekly and emergency systems maintenance in
                           accordance with procedures established by Supplier
                           and approved by PacifiCare or as applicable, in
                           accordance with existing procedures, to minimize the
                           impact to PacifiCare's business.

                  r.       Perform computer shutdowns and restarts as required,
                           and execute customary data center utility functions.

                  s.       Assimilate new work into the operational environment.

                  t.       Maintain, administer, and provide necessary automated
                           tools and processes (i.e., to the extent available in
                           the PacifiCare-selected tool suite or required to be
                           delivered by the Supplier elsewhere in the Agreement,
                           maintain tables, calendars, parameters, definitions
                           for tools used to automate manual procedures or
                           automate and improve the quality of the operations
                           Service Levels) for systems management. With respect
                           to Equipment not located at the Supplier operated
                           data center, provide remote monitoring and
                           management.

                  u.       Check job outputs and print queues, change job
                           priorities, take printers in and out of service, and
                           start, spool and drain printers.

                                       5.
<PAGE>
                  v.       Resolve system/application failures caused by
                           conditions external to production programs. Repair
                           system/application failures when possible and perform
                           job restarts.

                  w.       Force off End-Users in accordance with procedures
                           developed and documented with PacifiCare's input and
                           approval.

                  x.       Provide operational support for data transmission
                           (send / receive) consistent with regulatory,
                           commercial or PacifiCare standards.

                  y.       Maintain and update the operational documentation for
                           all operations procedures and services.

                  z.       Provide feedback to PacifiCare regarding the impact
                           of potential architecture and design changes.

                  aa.      Identify opportunities to PacifiCare to reduce
                           Equipment and Software costs and/or improve Midrange
                           system performance.

                  bb.      Develop standards for system configurations,
                           operations, and metrics collection and reporting.

                  cc.      Analyze system performance metrics and respond
                           proactively to potential problem areas.

                  dd.      Identify requirements for System Upgrades and other
                           configuration design changes, and coordinate these
                           changes with PacifiCare.

                  ee.      Work with PacifiCare to plan the deployment and
                           retirement of the computing systems.

                  ff.      Provide operational support for computing systems
                           [...***...] located in the data centers.

                  gg.      Operate system consoles.

                  hh.      Run or terminate utilities upon Technical Support or
                           PacifiCare approval depending upon the impact to
                           End-Users.

                  ii.      Perform changes per System Activity Requests
                           (SARs)/Change Request Authorizations.

                  jj.      Proactively prepare for End-User deadlines per
                           customized user requirements.

                  kk.      Perform regular storage backups on all systems.

         3.       PRODUCTION CONTROL AND SCHEDULING:

                  SUPPLIER'S SOLUTION DESCRIPTION:PRODUCTION CONTROL-BATCH
                  MONITORING

                  Supplier shall monitor Supplier or PacifiCare scheduled,
         originated and/or initiated jobs and take specific documented actions
         in the event of an abnormal condition. Supplier's

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       6.
<PAGE>
         application support personnel are responsible for creating and
         maintaining documented recovery procedures to be used by the data
         center in the event of an abnormal job termination. [...***...]. This
         does not include the development of application-automated controls.
         Supplier shall use the current production contROL system until
         transitioned to a Supplier recommended system approved by PacifiCare.

                  PACIFICARE USER INITIATED JOB MONITORING

                  Supplier shall provide monitoring for PacifiCare initiated
         jobs and take specific documented actions in the event of an abnormal
         condition. [...***...], defining conditions under which Supplier shall
         notify PacifiCare and /or Application SuppliEr, and documenting actions
         to be taken by Supplier in the event that an abnormal condition arises.
         This does not include the development of application-automated
         controls.

                  Supplier is required to provide job recovery documentation as
         part of the production request process. Supplier's production control
         shall work with all requesting parties to ensure that appropriate
         documentation is provided. [...***...].

                  JOB SCHEDULING AND AUTOMATION

                  Supplier shall provide platform automation and job scheduling.
         Included are:

           -        Review and comment on PacifiCare's current batch job
                  procedures

           -        Administer the automation of batch jobs and repetitive
                  procedures

           -        Send automated alerts on critical application jobs to the
                  PacifiCare via pager

           -        Send automated alerts on system critical events to Supplier

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall be responsible for integrating all production
         control and scheduling functions in conformity with PacifiCare's
         End-User requirements. Supplier's responsibilities shall include the
         following:

                  a.       Establish, document and maintain standards for
                           production jobs.

                  b.       Identify job dependencies, create and maintain job
                           dependencies on the master scheduling database,
                           prioritize and schedule batch jobs and report
                           distribution systems in accordance with PacifiCare's
                           schedule parameters to optimize use of processing
                           windows and scheduled availability of on-line
                           applications dependent on batch processing; provided,
                           however that batch completion times and Service
                           Levels are met. Take other

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       7.
<PAGE>
                           necessary steps to prepare applications job streams
                           for production scheduling and execution. Develop,
                           distribute, and obtain PacifiCare's approval of
                           schedules prior to implementation.

                  c.       Coordinate and modify schedules for special requests
                           and follow PacifiCare's priorities. Respond
                           expeditiously to requests from PacifiCare for
                           priority job execution.

                  d.       Resolve scheduling conflicts.

                  e.       Promptly notify PacifiCare if special requests shall
                           affect the timely completion of other tasks.

                  f.       Provide schedule status updates.

                  g.       Enter program control specifications into application
                           job streams as directed by End-Users. Document system
                           job streams indicating file usage, job
                           dependencies/priorities and program options
                           available.

                  h.       Resolve system/application failures or interruptions
                           caused by conditions external to production programs,
                           such as disk or media problems. Execute re-runs as
                           requested by PacifiCare and restart jobs according to
                           Supplier-developed operational procedures (e.g.,
                           procedures for successful back-outs, etc.). Create
                           problem reports for job abnormalities using a single
                           integrated problem management application in
                           accordance with Supplier's problem management
                           obligations pursuant to Section F, Customer Support
                           Department (Help Desk), of this Statement of Work.

                  i.       Monitor production scheduling cycles.

                  j.       Perform documentation control on all operational
                           documentation.

         4.       OPERATION SUPPORT FOR NEW SERVICES:

                  SUPPLIER'S SOLUTION DESCRIPTION: INTERFACE BETWEEN THE GROUPS
                  IMPLEMENTING CHANGES AND THE PRODUCTION SUPPORT FUNCTION

                  Supplier's Change Management Procedures are a complete process
         that includes key process metrics and shall fully integrate with
         PacifiCare's process. Change management involves planning,
         coordinating, monitoring, and communicating changes that affect
         PacifiCare's systems environment. Supplier uses change management's
         (described below) standardized procedures to minimize the negative
         impact of changes to Service Level commitments. The Change Management
         Procedures cover any change that can alter service delivery, including:

                  -        Equipment - installations, discontinuances, and
                           relocation of Equipment in the data center or remote
                           locations. This includes miscellaneous Equipment
                           specifications (MES) activities and engineering
                           changes (ECs) that involve standalone time or those
                           that could impact availability or access to data.

                  -        Software - Software changes including modifications
                           to the system operating code, access methods, program
                           products, or common system support modules.

                  -        Application - application changes being phased into
                           the production system.

                                       8.
<PAGE>
                           [...***...]. This would include required
                           update/changes to production databases.

                  -        Procedure - changes to procedures that may affect
                           systems availability or accessibility.

                  All changes to the production environment follow a defined
         Change Management Procedure. Change management's objectives are:

                  -        Provide a change management system that reduces or
                           eliminates disruptions caused by change
                           implementation

                  -        Implement changes on schedule

                  -        Eliminate or reduce the number of change back-outs
                           caused by ineffective change planning or
                           implementation

                  -        Eliminate or reduce the number of problems caused by
                           change

                  -        Eliminate or reduce the system outages caused by
                           change

                  Key indicators of success in change management are:

                  -        Changes become operational on the first installation
                           attempt and do not need to be backed out, bypassed,
                           or modified

                  -        Changes are installed according to the scheduled time
                           commitments

                  COMPLIANCE WITH STANDARD DOCUMENTATION

                  The Supplier Program Office has accountability for verifying
         compliance with standard documentation for in-scope services. Standard
         documentation is interpreted to mean either PacifiCare specific
         documentation or Supplier specific documentation.

                  ORDERLY TURNOVER

                  Supplier shall use a dedicated transition manager and
         transition team and the information that is acquired during the due
         diligence period, along with Supplier's working knowledge of
         PacifiCare; to provide an efficient, thorough, and orderly turnover and
         transition of services.

                  SERVICE LEVEL STANDARDS

                  Supplier shall use its Service Level management approach,
         which is based on Supplier's standardized processes, including the
         following activities:

                  -        Developing and maintaining service performance
                           standards for new and existing contracts

                  -        Collecting and analyzing data to determine the
                           appropriate Service Level measurements

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       9.
<PAGE>
                  -        Developing Service Level document(s) that contain
                           Service Level commitments

                  -        Reviewing service operations on a daily, weekly, and
                           monthly basis

                  -        Addressing service delivery issues

                  -        Gathering information/feedback from and communicating
                           pertinent information to PacifiCare, the account team
                           and the delivery team

                  -        Processing Service Level billing impacts

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall interface between the groups implementing
         changes and the production support function, assuring compliance with
         standard documentation and orderly turnover. Supplier's
         responsibilities for operations support for New Services shall include:

                  a.       Obtain formal approvals of production testing and
                           installation timetables.

                  b.       Assimilate new applications and batch jobs into the
                           environment.

                  c.       Develop comprehensive operational documentation.

                  d.       Facilitate orderly turnover for Equipment and
                           applications to include developing fallback
                           procedures.

                  e.       Use standard platforms.

                  f.       Support for the introduction of new platforms and
                           applications in accordance with the Change Management
                           Procedures and PacifiCare architectural standards,
                           and in a controlled manner by, among other things:
                           interfacing with the groups implementing the change
                           and the production support function; notifying
                           PacifiCare of incompatibilities believed by Supplier
                           to occur with other planned changes or business
                           events; facilitating the orderly turnover of systems,
                           platforms and applications; enforcing documentation
                           standards; updating task list and run sheets;
                           informing appropriate Supplier and PacifiCare staff
                           of the changes to the environment; and providing
                           coordination of the implementation, integration,
                           testing and acceptance of the new platforms and
                           applications into the production environment
                           properly.

         5.       EXTERNAL STORAGE MEDIA OPERATIONS AND ADMINISTRATION:

                  SUPPLIER'S SOLUTION DESCRIPTION: PROCESSES, TOOLS AND
                  PROCEDURES

                  [...***...] PacifiCare media library operations and media
         management system responsibilities, including the shipping and
         receiving of media to and from off-site facilities. Beginning on the
         Effective Date, Supplier shall use current PacifiCare media operations
         and administration processes, tools, and procedures shall. During the
         Transition Period, Supplier shall evaluate these processes, tools, and
         procedures for effectiveness; [...***...].

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                      10.
<PAGE>
                  Supplier shall also develop and utilize processes and
         procedures to take advantage of new technology as it becomes available.
         [...***...]. Supplier shall be responsible for the backup and restore
         of data according to the Policies and Procedures Manual, and as
         necessary to meet the Service Levels.

                  Supplier shall product reports of storage media [...***...].
         Until Supplier and PacifiCare determine which reports best keep
         PacifiCare informed of its storage media, [...***...].

                  MAINTAIN AND VERIFY AVAILABILITY DURING AGREED UPON ACCESS
                  TIMES

                  Maintenance and availability shall be verified through the
         establishment of Service Levels.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  a.       Supplier shall assume operational and financial
                           responsibilities for all external storage media
                           management functions, both on- and off-site, for
                           external storage media library operations and
                           administration performed in the data center
                           environment. Supplier's responsibilities for the
                           foregoing shall include the following:

                  b.       Define off-site storage requirements.

                  c.       Perform external storage media mounts as necessary to
                           support operational activities at sites staffed by
                           Supplier personnel. At sites not staffed by Supplier
                           personnel, Supplier shall direct PacifiCare personnel
                           performing external storage media mounts.

                  d.       Operate and support the media library and library
                           management system.

                  e.       Maintain a database cataloging the archival system
                           for the media library and maintain the library
                           management system.

                  f.       Follow off-site external storage media storage
                           procedures, [...***...].

                  g.       Monitor external storage media Equipment for
                           malfunction and initiate corrective action in
                           accordance with established procedures. Properly
                           clean and maintain Equipment at intervals established
                           to minimize problems and outages.

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                      11.
<PAGE>
                  h.       Maintain the integrity of the external storage media
                           library system. Monitor external storage media for
                           reliability and minimizing of read/write errors
                           during the entire period of retention.

                  i.       Monitor and report external storage media usage.

                  j.       Recopy external storage media as necessary to support
                           minimizing of read/write errors.

                  k.       Monitor PacifiCare's external storage media to comply
                           with PacifiCare and government requirements and
                           report on a monthly basis. Maintain adequate supplies
                           for the external storage media environment and
                           sufficient scratch media.

                  l.       Retrieve archived external storage media from on-site
                           and off-site storage as requested by PacifiCare or as
                           required in an emergency and restore required files
                           and datasets in a timely manner.

                  m.       Perform Equipment maintenance in accordance with the
                           manufacturer's specifications.

                  n.       Prepare and ship media as requested by PacifiCare or
                           otherwise as required to off-site storage Suppliers
                           or third parties retained to provide off-site storage
                           services or to other third parties as requested by
                           PacifiCare.

                  o.       Initialize new external storage media.

                  p.       Perform backup procedures as required by the Business
                           Continuity Plan and as detailed in PacifiCare
                           Production Services Operations Documentation.

                  q.       Follow, maintain and update procedures in the Policy
                           and Procedures Manual governing cycling/rotation of
                           external storage media, external storage media
                           management and external storage media retention
                           periods (including for auditing purposes) in
                           accordance with the Safety and Security Procedures
                           (Schedule 10.2). Dispose of retired media in an
                           environmentally sound manner.

                  r.       Permit and provide adequate data to enable PacifiCare
                           to monitor compliance with retention and storage
                           requirements as defined in Schedule 10.2.

                  s.       Periodically [...***...], retrieve a randomly
                           selected data file and application as a test and
                           verify that the data and application can be restored
                           in a usable fashion.

                  t.       Maintain an inventory control system in place to
                           properly manage external storage media in storage and
                           prepare them for shipment to the contingency site.

                  u.       Recycle media regularly, manage media replacement,
                           and recopy media to provide Data integrity and
                           quality.

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                      12.
<PAGE>
                  6. Off-Site Media Storage:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall leverage as much of the current PacifiCare
         investment as possible regarding the processes, tools, and procedures
         PacifiCare uses to perform off-site removable data storage media
         responsibilities. Additionally, Supplier shall employ a bonded vaulting
         service to provide secure, recoverable data management capability.

                  Supplier shall conduct the media library processes and
         procedures at PacifiCare or Supplier Service Locations shall in
         accordance with required security and audit controls and shall comply
         with specific regulations for media management.

                  Supplier shall produce reports of off-site removable data
         storage media [...***...]. Until Supplier and PacifiCare determine
         which reports best keep PacifiCare informed of its off-site removable
         data storage media, [...***...].

                  [...***...].

                  Supplier shall continue to use the products currently deployed
         in the PacifiCare environment to the greatest extent possible.
         [...***...].

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall assume operational and financial
         responsibility for off-site media storage, including integrity
         checking, defining storage requirements, and assuring compliance with
         PacifiCare or government requirements. Supplier's support for off-site
         media storage Services shall include the following:

                  a.       Develop, in consultation with PacifiCare's individual
                           business units and the PacifiCare Business Continuity
                           coordinator, requirements, procedures, and standards
                           for off-site storage.

                  b.       Store external storage media and business-recovery
                           related paper documentation at secure off-site vault
                           storage in a physically and environmentally
                           controlled and protected area with appropriate fire
                           protection and multiple layers of physical security
                           designed to prevent unauthorized access.

                  c.       Execute off-site storage procedures, including
                           logging, shipping to, and receiving media from the
                           off-site Supplier.

                  d.       Return media as required to the originating Service
                           Location.

                  e.       Transport the materials to and from off-site storage
                           in unmarked, environmentally controlled vehicles
                           operated by bonded personnel.

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                      13.
<PAGE>
                  f.       Grant authorized PacifiCare representatives access to
                           inspect off site storage areas.

                  g.       Maintain integrity of data shipped to off-site
                           storage.

                  h.       Manage third party off-site storage suppliers and
                           notify PacifiCare of any problems. Advise PacifiCare
                           of any modifications to agreements with such third
                           party suppliers that would improve the efficiency of
                           the Services or otherwise benefit PacifiCare.

                  i.       Pack and ship media for off-site storage.

                  j.       Manage an inventory of off-site media.

                  k.       Provide an emergency media return process.

                  l.       Comply and review compliance with physical
                           specifications, retention periods, and security.

         7.       EQUIPMENT MAINTENANCE AND SUPPORT:

                  SUPPLIER'S SOLUTION DESCRIPTION: ENTERPRISE SYSTEMS MANAGEMENT
                  ARCHITECTURE (ESMA)

                  Supplier shall assume responsibility for [...***...], Supplier
         shall begin implementing Supplier's standard service delivery practices
         [...***...]. Modifications to both PacifiCare and Supplier processes
         shall be done to leverage the best of both service delivery models in
         order to meet PacifiCare's business needs. As each business is to some
         degree unique, each Information Technology implementation is also
         unique. [...***...]. The Exhibit 1 to this Statement of Work describes
         [...***...].

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall provide, or arrange for qualified third parties
         to provide maintenance for data center Equipment for which Supplier is
         otherwise responsible hereunder as necessary to keep such Equipment in
         good operating condition and in accordance with manufacturer's
         specifications or other agreements as applicable, so that such
         Equipment shall qualify for the manufacturer's standard maintenance
         plan upon sale or return to a lessor. [...***...]. Such maintenance
         shall be performed in accordance with the System Activity Request
         (SAR)/Change Management Procedures, so as to minimize the disruption to
         PacifiCare's normal business processes. Supplier's responsibility for
         such functions shall also include the following:

                  a.       Manage the third party service providers that provide
                           Equipment support.

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                      14.
<PAGE>
                  b.       Plan, order, install, test and maintain all Equipment
                           at Supplier-operated data center and work with third
                           parties to resolve Equipment problems. Supplier's
                           responsibilities include tracking configurations of
                           Equipment and peripherals and maintaining complete
                           configuration documentation of the Supplier-operated
                           data center using CAD Software tools. In addition,
                           Supplier is expected to provide complete
                           Supplier-operated data center support for all
                           environmental Equipment at the Supplier data center.

                  c.       With respect to distributed Equipment for which
                           Supplier is otherwise responsible hereunder, Supplier
                           shall provide break/fix, support, advice and
                           assistance to End-Users. Supplier shall correct all
                           problems associated with failure or maintenance of
                           such Equipment. Supplier shall install upgrades for
                           such distributed computing-related Equipment at the
                           Service Locations. Supplier shall maintain a level of
                           documentation that reflects the complexity and
                           diversity of the environment and facilitates the
                           Equipment support process.

                  d.       Coordinate rollouts and upgrades of Equipment.
                           Supplier shall be responsible for coordinating any
                           testing, scheduling, and installation integration of
                           these products including any third parties if
                           required. Supplier shall also perform full testing
                           after installation and provide proper back-out
                           procedures. If installation occurs after hours,
                           Supplier shall also make available on-site support,
                           including required third party service providers, the
                           next working business day in order to provide the
                           necessary support.

                  e.       Maintain an effective inventory of all spare parts
                           and Equipment used to support the Equipment for which
                           Supplier has maintenance responsibility, and track
                           such inventory in an inventory management database
                           system. This inventory shall be adequate to allow
                           Supplier to meet or exceed the PacifiCare Service
                           Levels.

                  f.       Perform all operations required to support the
                           refresh and cascading of Equipment associated with
                           providing the Services throughout PacifiCare's
                           operations. This shall include: planning, associated
                           change management and problem management,
                           de-installation, reinstallation, configuration,
                           staging, and user orientation as otherwise specified
                           hereunder.

                  g.       Provide complete documentation of the Data Center
                           using CAD Software tools.

                  h.       Perform the design, installation, termination, and
                           documentation of all cabling for the Midrange
                           environments.

                  i.       Planning installation of computer and environmental
                           Equipment in Data Center environment.

                  j.       Resolve Equipment-related problems in the Data Center
                           environment.

                  k.       Monitor Equipment leases in the Data Center
                           environment.

8.       DATA CENTER PLANNING AND OPERATIONS:

                                      15.
<PAGE>
                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall work with the site's facilities department and
         PacifiCare to verify continued and comprehensive Physical Access
         Control from the Effective Date through the completion of the
         Transition Period and as applicable during the Term and Termination
         Assistance Period. Supplier shall comply with and enforce PacifiCare's
         Data Center Building Security Procedure policies that are within
         Supplier's control. This includes identification of badge controls, as
         well as the monitoring of security alarms, security video systems, and
         alarm responses for all Supplier owned facilities. Supplier shall grant
         approved PacifiCare personnel access to Service Locations in which the
         Supplier is providing support for PacifiCare's services. Supplier shall
         provide logical security for PacifiCare's intellectual and physical
         property that is within Supplier's control.

                  Supplier shall comply with PacifiCare's Data Center Building
         Security Procedures [...***...]. PacifiCare and Supplier shall
         implement jointly agreed to procedures whereby Supplier shall respond
         to alarms and abnormal conditions with the appropriate level of
         intervention and corrective action and document such occurrences
         sufficiently, in accordance with PacifiCare's Data Center Building
         Security Procedures.

                  The Supplier Program Office shall work with PacifiCare's
         Facilities Management team to proactively plan [...***...] by Supplier
         as modifications are warranted.

                  TYPE OF GUIDANCE AND COORDINATION SUPPLIER SHALL PROVIDE
         DURING EQUIPMENT INSTALLATIONS, ROUTINE MAINTENANCE, PROBLEM, AND
         CRISIS MANAGEMENT

                  Supplier shall provide comprehensive guidance and coordination
         through the Program Office in accordance with the Problem Management
         process and Change Management Procedures in order to minimize
         disruption to End-Users, [...***...]. Supplier shall monitor and
         maintain the electrical power system, as well as the system for
         controlling the temperature and humidity that are primary support for
         the computer room(s) and any backups, secondary power, standby systems,
         or excess capacity that is available for use in case of failure.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall provide physical access strategies and
         standards for the Supplier Data Center environment, working with
         PacifiCare's Facilities department as required. The Supplier shall
         develop procedures with adequate controls, audit trails and shall
         respond to security violations. The Supplier shall also initiate and
         track requests for space, power and other Data Center modifications in
         support of Equipment installations. The Supplier shall provide guidance
         and coordination for all platforms activities during Equipment
         installations, routine maintenance, problem and crisis management. The
         Supplier shall manage and maintain the building and property electrical
         systems, heating, ventilation, and air conditioning (HVAC) systems,
         physical security services, and general custodial/landscape services.
         Other specific Supplier responsibilities include:

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                      16.
<PAGE>
                  a.       Monitor and maintain the Uninterruptible Power Supply
                           (UPS) system, air handlers and water chillers that
                           are primary support for the computer room(s).

                  b.       Manage and maintain the employee badge, security
                           video and fire alarm systems.

                  c.       Provide physical access strategies and standards for
                           the Data Center environment.

                  d.       Keep security devices in working order, develop
                           procedures using adequate controls, audit trails,
                           respond to security violations and breeches in a
                           timely manner and resolve security breaches in
                           collaboration with and with the approval of
                           PacifiCare.

                  e.       Initiate and track requests for space, power and
                           other Data Center modifications in support of
                           Equipment installations.

                  f.       Maintain Equipment and cabinets.

                  g.       Provide input into the design of contingency plans
                           from a physical aspect.

                  h.       Provide guidance and coordination for all platforms
                           activities during Equipment installations, routine
                           maintenance, problem and crisis management including
                           interfacing with facilities and technology groups,
                           Suppliers and trades.

                  i.       Maintain building electrical systems.

                  DEVELOPMENT LAB

                  [...***...]. Supplier shall maintain the development lab for
         such use and shall not allow the installation or use of any Software
         for which there is not a valid license. [...***...]. The Critical
         Deliverable referred to as "Creation of New Development Lab" in
         Schedule 8 to the Agreement states the measured level of performance
         associated with the development lab. Supplier shall provide the
         infrastructure Software and shall be responsible for the licenses and
         maintenance thereof. Supplier shall implement the procedures for
         providing access to the development lab provided or approved by
         PacifiCare.

         9.       ENTERPRISE STORAGE SUBSYSTEM MANAGEMENT:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall monitor and control storage performance,
         initialize storage volumes, establish and maintain storage standards,
         and perform catalogue management and data migration management.
         Supplier shall perform capacity planning for all storage Equipment and
         shall maintain and publish capacity plans [...***...].

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                      17.
<PAGE>
                  Storage management encompasses [...***...]. This process
         produces useful information for analyzing trends in performance,
         capacity, availability, and load balancing as they are related to data
         storage. [...***...].

                  This support includes the following:

                  -        Identifying and maintaining the appropriate threshold
                           levels to reduce potential space constraints

                  -        Communicating disk space availability, space-related
                           problems, and areas of potential problems

                  -        Data movement

                  -        Creating and maintaining plans for system and user
                           catalogue and for incremental and full-volume backup
                           and recovery

                  Supplier's processes utilize monitoring and data analysis to
         look for proactive changes that could be made to improve the
         environment. PacifiCare support teams are part of Supplier's global
         team so they shall be able to compare notes from other accounts that
         may be useful in the support of the PacifiCare account.

                  Supplier shall allocate storage pools as required by
         PacifiCare for production, development and testing. [...***...].
         Supplier shall report on storage utilization, allocation, and the
         historical usage of datasets on direct access storage [...***...].

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier's responsibilities to protect the availability,
         performance, and integrity of all PacifiCare data shall include the
         following:

                  OPERATIONS AND PROCESSING.

                  a.       Define off-site storage requirements. Supplier Global
                           Services shall follow offsite media storage
                           requirements at the Pacific Care Data Center. Offsite
                           media storage shall follow Pacific Care established
                           standards.

                  b.       Remain current in knowledge of data storage
                           technology and management products.

                  c.       Perform enterprise storage system tuning.

                  d.       Assign and initialize storage as required for the
                           performance of the Services.

                  e.       Determine file/data set and volume placement.

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                      18.
<PAGE>
                  f.       Monitor End-User directories for file inactivity and
                           report monthly.

                  g.       Initiate and complete required processing management
                           functions to preserve the integrity of PacifiCare
                           data.

                  h.       Conduct routine monitoring via the use of Software
                           tools to measure the efficiency of storage access and
                           take corrective action [...***...].

                  i.       Establish and perform verification procedures to
                           monitor the successful receipt of incoming production
                           files and the successful transmission of outgoing
                           production files.

                  BACKUP AND RESTORE.

                  a.       Perform routine backup (both full and incremental)
                           and recovery procedures in accordance with the
                           requirements of applications or of the Disaster
                           Recovery Plan and so as not to adversely impact
                           scheduled operations, including regular backups on
                           all storage systems. Utilize automated backup
                           procedures wherever appropriate.

                  b.       Provide recommendations to PacifiCare regarding
                           backup and recovery considerations, such as improved
                           levels of protection, efficiencies and cost
                           reductions.

                  c.       Retrieve and return off-site stored data.

                  ADMINISTRATION.

                  a.       Advise PacifiCare of file space required to meet
                           PacifiCare's forecast business and operational needs.
                           Establish and document storage and usage thresholds
                           and standards that optimize storage space and monitor
                           over-utilization of storage space.

                  b.       Monitor PacifiCare's disk space utilization and
                           requirements and report on a monthly basis in
                           addition to reasonable numbers of on-demand
                           reporting.

                  c.       Monitor the performance of storage and retrieval
                           tasks.

                  d.       Monitor and maintain file directories and catalogs.

                  e.       Monitor End-User directories for file inactivity and
                           report monthly.

                  f.       Provide disk and file management and reorganization,
                           as reasonably requested by PacifiCare [e.g.,
                           disk-to-tape, disk to disk].

                  g.       Provide data migration management.

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                      19.
<PAGE>
                  h.       Maintain PacifiCare data and records in accordance
                           with regulatory requirements applicable to
                           PacifiCare, as identified to Supplier from time to
                           time in sufficient detail to enable Supplier to
                           fulfill its obligations.

                  MAINTENANCE.

                  a.       Monitor storage systems for reliability and
                           malfunction.

                  b.       Perform recovery procedures from disk failures.

                  c.       Maintain established storage standards.

                  d.       Maintain space requirements according to PacifiCare
                           business forecasts.

         10.      END-USER SUPPORT:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier's help desk solution for PacifiCare results in a
         single-point-of-contact (SPOC) for all End-User problems. End-Users
         shall submit problems to the help desk by placing a call to an Supplier
         provided 1-800 number [...***...].

                  Supplier's [...***...]. A voice response unit (VRU) shall
         receive End-User calls and utilize skill based routing, directing calls
         to the most qualified and available help desk agent. The help desk
         agent shall resolve the call if possible, otherwise the agent shall
         pass non-resolvable problem tickets to the appropriate resolver group.
         The help desk agent shall also maintain ownership for the problem
         through problem resolution. Supplier shall implement this solution by
         leveraging existing PacifiCare procedures, combined with proven
         Supplier processes and procedures.

                  The help desk shall support [...***...].

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall provide support, advice and assistance to
         End-Users in a manner consistent with current practices. Services shall
         include the following:

                  a.       Perform analysis to provide optimal use of production
                           resources.

                  b.       Carry out mass job control changes for programmers,
                           data center and users.

                  c.       Enforce job control and job naming standards.

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                                      20.
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                  d.       Provide technical support and administration for
                           various Data Center products and application
                           rollouts.

         11.      ADMINISTRATION:

                  SUPPLIER'S SOLUTION DESCRIPTION: COSTS AND VALUE

                  Supplier shall implement and follow the following processes in
         managing the operation environments.:

                  -        Problem Management

                  -        Change Management

                  -        Crisis Management

                  -        Quality Assurance

                  [...***...]

                  The tools and strategies Supplier shall bring to PacifiCare
         are also included. Based on the strategies, processes, and tools
         Supplier expects to:

                  -        Reduce cost and improve manageability in high-growth
                           environments

                  -        Achieve Equipment price performance gains [...***...]

                  -        Gain more efficient resource use through automation
                           for system maintenance

                  MAINTAINING INVENTORIES

                  [...***...]. As machines are purchased and deployed, or old
         machines are decommissioned or redeployed, [...***...].

                  SECURITY ACCESS AND CONTROL

                  Supplier has established security and access policies and
         practices that protect the data of each Supplier PacifiCare.
         [...***...]. Supplier shall work with PacifiCare Security to verify
         that the appropriate touch points are established to meet PacifiCare's
         and Supplier's requirements. Supplier shall provide access to all
         PacifiCare data in accordance with mutually agreed to policies and
         standards that meet both of Supplier's objectives.

                  AUDITS

                  In addition to Section 19 of the Agreement, Suppliers Program
         Office process owner is responsible and accountable for verifying that
         the appropriate controls are in existence and

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                      21.
<PAGE>
         operating effectively for their process. Metrics and inspections are
         examples of ongoing activities to determine that controls are operating
         effectively. Audits are used as further validation that controls are in
         place and operating as intended.

                  The approach for responding to audits is the same for internal
         and external audits, [...***...]. This includes performing the
         following activities:

                  -        Assigning a focal point to coordinate the audit
                           activities with the staff

                  -        Providing communication announcing the audit

                  -        Engaging the appropriate staff of the process being
                           audited

                  -        Providing logistical support for the audit team

                  -        Providing the initial information requests in the
                           pre-audit phase to the audit team

                  -        Providing data as requested during the audit and
                           tracking information requests

                  -        Scheduling meetings and providing management updates
                           through the focal point

                  Supplier's Program Office process owner is also responsible
         for understanding the control issues that were identified in the audit.
         Such process owner is required to assess the issues that are identified
         and provide concurrence on them to the audit team. Supplier shall
         communicate audit results to the appropriate management and staff.
         Supplier's Program Office process owner is responsible for
         understanding the root cause of the issues and developing the
         appropriate action plans.

                  Supplier's Program Office process owner is responsible for
         revising processes and procedures and implementing process improvements
         to address issues that are identified through audits. Such process
         owner shall respond to audit recommendations [...***...]. Such action
         plans include assigned responsibilities and specific target dates to
         verify that the audit recommendations are implemented on a timely
         basis.

                  Supplier shall use management reviews and metrics are used to
         determine that recommendations are implemented on a timely basis.
         Supplier shall post audit inspections, to validate that all identified
         issues, are closed and recommendations are implemented. In addition,
         Supplier's Internal Audit and Business Controls have a follow up
         process to verify that all recommendations and action plans have been
         fully implemented.

                  SAFETY ISSUES

                  Supplier shall respond to all potential and actual safety
         issues within Supplier Service Locations. Supplier shall interface with
         PacifiCare's Real Estate Property Services organization for all safety
         issues within PacifiCare Service Locations.

                  ETHICAL STANDARDS

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                  Supplier's Business Conduct Guidelines outline the ethical
         standards which all Supplier employees are expected to meet and detail
         the manner in which Supplier shall conduct business. Each year, all
         Supplier employees certify that they have read and understood these
         ethical standards. Supplier's Business Conduct Guidelines are expected
         to be comparable with PacifiCare's employee guidelines.

                  [...***...]

                  Supplier shall manage all existing vendors and Equipment,
         [...***...] and coordinate all installations and upgrades. [...***...].

                  PROJECT MANAGEMENT REPORTS

                  During the Transition Period Supplier shall begin to work with
         PacifiCare to prioritize all initiatives through the Supplier Program
         Office and an ongoing process shall be developed for us to jointly set
         the priorities on all project work. Once initiatives and their
         associated schedules are agreed to, Supplier shall manage such
         initiatives and schedules shall using the Project Management
         methodology and Change Management Procedures.

                  PERSONNEL PERFORMANCE REVIEWS

                  Supplier's delivery team shall implement a process that shall
         allow PacifiCare's businesses to provide personnel performance
         assessment input. Supplier shall work with PacifiCare to solicit input
         from the employee, project, and overall perspective.

                  [...***...]. For those employees who are servicing the
         PacifiCare account, Supplier shall implement Supplier's performance
         assessment process (Personal Business Objectives) shall. [...***...]:

                  [...***...]

                  At the project level, the Supplier team shall:

                  -        Clearly identify PacifiCare's conditions of
                           satisfaction for each specific project

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                                      23.
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                  -        Monitor PacifiCare's expectations in a regular and
                           normalized manner, rather than relying on intuition
                           or assumptions about the quality of the services
                           Supplier is providing

                  -        Measure PacifiCare's level of satisfaction with
                           Supplier service delivery

                  At the overall level, Supplier shall solicit from PacifiCare
         [...***...] specific conditions of satisfaction. [...***...]. In
         addition, Supplier shall ask PacifiCare to provide an overall
         satisfaction rating upon completion of the project. [...***...].

                  [...***...].

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall perform all administrative activities
         associated with managing the Data, maintaining inventories of hard and
         soft assets, responding to audits, responding to safety issues,
         conforming to ethical standards, negotiating contracts, prioritizing
         initiatives, producing management reports and conducting personnel
         performance reviews. Such services shall include the following:

                  a.       Respond to internal and external audits.

                  b.       Acquire and manage human resources and conducting
                           periodic personnel performance reviews.

                  c.       Negotiate and manage contracts with Suppliers.

                  d.       Produce management reports.

                  e.       Maintain inventories of hard and soft assets.

                  f.       Manage Data Center costs and value.

                  g.       Monitor performance internally and benchmark
                           activities.

                  h.       Manage, prioritize and coordinate improvement
                           initiatives throughout the technology organization so
                           that they are consistent, achievable and are not
                           competing for scarce resources.

                  12.      SOFTWARE CURRENCY, REFRESH, AND RELEASE CONTROL:

                  SUPPLIER'S SOLUTION DESCRIPTION:

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                                      24.
<PAGE>
                  Supplier shall install, maintain, and upgrade Software for
         which Supplier is responsible. [...***...]. However, should Supplier be
         made aware of problems that have not been corrected in the Software
         release, or if Supplier has reason to believe that the Software release
         could adversely affect PacifiCare's or Supplier's ability to meet
         Service Level targets, Supplier would notify PacifiCare of the concern
         and work with PacifiCare to provide an appropriate course of action,
         [...***...]. This would also include problems that are encountered
         during system and integration testing.

                  [...***...]. The Supplier shall fully test any new release of
         system Software before installing it for production use. Supplier shall
         also fully test operating systems Software for PacifiCare and
         coordinate with applications personnel and End-Users in accordance with
         the Change Management Procedures methodology (Policy and Procedures
         Manual. and the test plan for each Software modification.

                  PROCEDURES AND OR PROCESSES THAT ARE USED TO INSTALL SOFTWARE
         CHANGES, UPGRADES, OR NEW RELEASES

                  When implementing changes, upgrades, or enhancements to the
         PacifiCare Software environment, Supplier shall observe the Change
         Management Procedures and shall perform installation planning, product
         installation, testing, and verification. In addition, for any Software
         changes, upgrades, or enhancements proposed to PacifiCare, Supplier
         shall advise PacifiCare of any additional Equipment, LAN, or
         environmental requirements, which are observed during integration
         testing and/or are otherwise known to be necessary for implementation
         of the changes, upgrades, or enhancements. As requested by PacifiCare,
         Supplier shall provide the installation of department or End-User
         specific Software in accordance with the Supplier Change Management
         Procedures methodology. Supplier shall report to PacifiCare the
         installation of such [...***...].

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Services shall include the following:

                  a.       Unless otherwise directed by PacifiCare, Supplier
                           shall install, maintain and upgrade Software for
                           which Supplier is otherwise responsible hereunder so
                           that such Software remains within one generation of
                           the current release and remains on a supported
                           release. [...***...].

                  b.       Coordinate, test, customize, install, maintain and
                           support systems and systems program products.

                  c.       Test operating Systems Software, coordinating with
                           applications personnel and End-Users.

                  d.       In implementing changes, upgrades, or enhancements to
                           the PacifiCare Software environment, Supplier shall
                           observe the Change Management Procedures and

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                                      25.
<PAGE>
                           shall perform installation planning, product
                           installation, testing and verification. In addition,
                           Supplier shall, for any Software changes, upgrades,
                           or enhancements proposed to PacifiCare advise
                           PacifiCare of any additional Equipment, LAN,
                           environmental, etc. requirements observed during
                           integration testing and/or otherwise known to be
                           necessary for implementation of the changes, upgrades
                           or enhancement. Supplier shall also:

                  e.       Demonstrate compliance with PacifiCare Corporate
                           Information Technology Architecture and Technical
                           Standards, if applicable.

                  f.       Demonstrate compliance with data security policies
                           and standards as required hereunder.

                  g.       Provide installation of department or
                           End-User-specific Software as requested by
                           PacifiCare. Supplier shall periodically (at least
                           monthly) report to PacifiCare the installation of
                           such Software.

                  h.       Supplier shall provide support, advice and assistance
                           to End-Users for Software for which Supplier is
                           responsible hereunder.

                  i.       [...***...].

                  j.       To the extent enabled in the PacifiCare approved
                           enterprise management system provided by Supplier,
                           Supplier shall monitor use of licensed Software,
                           including license metering and tracking.

                  k.       Administer and maintain the development-to-production
                           system.

                  l.       Install and support interactive systems Software and
                           database Software.

         13.      BACK-UP AND RECOVERY SERVICES:

                  SUPPLIER'S SOLUTION DESCRIPTION: OFF-SITE VAULTING

                  [...***...]. Supplier shall continue to review processes with
         PacifiCare as technology changes to provide PacifiCare with vaulting
         processes that preserve data in a reliable, secure way. PacifiCare's
         involvement is not required to verify that critical information is
         being protected, but PacifiCare may need to assist with some of the
         steps of recovery.

                  CATALOGUING OFF-SITE CONTENT

                  [...***...]. While Supplier does have a product that can
         perform off-

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                      26.
<PAGE>
         site cataloguing (both remote and local), Supplier believes the most
         prudent course of action shall be to work with PacifiCare to determine
         if an alternative or supplemental product is required.

                  RETRIEVING BACK-UP MEDIA AND RESTORING DATA FROM BACK-UPS

                  Control backup and recovery is the process of planning,
         testing, and implementing the recovery procedures and standards that
         are required to resume normal IT services in the event of a failure.

                  The Supplier storage management team handles both scheduled
         and unscheduled requests for pre-authorized services. When a requester
         is not on the pre-authorized list provided by PacifiCare, Supplier
         shall contact PacifiCare to establish entitlement.

                  For unscheduled backup requests, Supplier must clearly
         understand the nature of the request for backup before Supplier shall
         execute the backup. Once a change record has been established, the
         requester and other effected parties may receive a phone call for
         clarification and/or approval to go ahead if the request for backup
         conflicts with a previously scheduled backup. Supplier shall work with
         PacifiCare to understand what activities shall need to be performed
         once a backup completes successfully and what steps shall need to be
         taken when the backup is unsuccessful.

                  In the case of a request for recovery, Supplier shall analyze
         the request for recovery [...***...]. A problem record shall be
         required to identify the recovery request and a change record shall
         need to be approved to restore the Software to a previous state.
         [...***...]. Supplier shall only be responsible for restoring data that
         has been backed up by Supplier. All data that is backed up by
         PacifiCare shall be PacifiCare's responsibility to restore. Upon
         successful completion of a requested recovery, a member of the Supplier
         Service Delivery team shall contact the requester to provide status.
         Once concurrence from the requester is gained, the request shall be
         closed. The Help Desk shall provide status to the End-User for the
         request number that is provided.

                  Consideration for change and service requests is included in
         the backup and recovery procedures. [...***...]. Supplier shall review
         the proposed plan with all appropriate parties. Change or service
         requests [...***...] need to be reviewed and approved by PacifiCare and
         Supplier. If the plan is approved, it shall be implemented. If the plan
         is not approved, then changes shall be made in an attempt to gain
         approval for the plan, the request shall be deferred pending
         resolution, or it shall be withdrawn.

                  [...***...].

                  [...***...] DAY-TO-DAY VAULTING PROCESS

                  The following is the vaulting process:

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                  [...***...]

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall assume responsibility for PacifiCare's data
         back-up requirements, which includes daily off-site vaulting of data on
         media, cataloging off-site content, retrieving back-up media and
         restoring data from the back-ups. Services shall include the following:

                  [...***...]

         14.      HOURS OF OPERATION:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  All systems operation functions of the Services described in
         this Section shall be provided 24 hours per day, 7 days per week as
         appropriate (except for scheduled maintenance windows and non-scheduled
         maintenance windows agreed to in advance by PacifiCare).

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         15.      PHYSICAL SECURITY ADMINISTRATION:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall monitor the security compliance of Service
         Locations under Supplier's control through internal audits, reviews,
         and key process control measurements. Additional precautions beyond
         those provided for in the standard are generally implemented to take
         into account special local conditions. Supplier's physical security
         process includes the following:

                  [...***...]

                  During the Transition Period, Supplier shall be holding a
         series of workshops with PacifiCare's information security and control
         [...***...]. The result of these workshops shall be a document that is
         structured on the standard Supplier information security controls, but
         customized to account for PacifiCare's specific requirements.

                  [...***...]. Prior to the completion of the Transition Plan,
         Supplier shall occupy and utilize the current PacifiCaRe data center
         facilities and PacifiCare shall retain the costs for supporting those
         facilities. For the duration of the time that processing is performed
         in the current facilities:

                  [...***...]

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<PAGE>

                  Supplier shall comply with and enforce all of PacifiCare's
         physical security policies that are within its control. [...***...].
         Supplier shall grant approved PacifiCare personnel access to all
         Service Locations in which Supplier Is providing support for
         PacifiCare's services. Supplier shall safeguard PacifiCare's assets by
         continually monitoring the physical environment for such things as
         temperature and humidity. Supplier shall provide physical and logical
         security for the data center and PacifiCare's physical and intellectual
         property as provided in the Safety and Security Procedures, , Schedule
         10.2.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier's responsibilities to provide physical security
         administration shall include the following:

                  At PacifiCare Service Locations, Supplier shall comply with
                  all PacifiCare physical security policies, standards and
                  procedures, as they may be revised or updated.

                  Supplier's responsibility for physical security at Service
                  Locations under Supplier's control shall include:

                  Provide appropriate Equipment and system Software to implement
                  security standards that are no less stringent than those
                  customarily maintained by well-managed large outsourcing
                  organizations providing services similar to the Services.

                  Provide access upon request to PacifiCare or its designees,
                  [...***...].

                  Establish security processes that shall be no less rigorous
                  than those in effect at those Service Locations as of the Cut
                  Over Date and meet or exceed PacifiCare's security
                  requirements then practiced by PacifiCare, shall be at a
                  minimum consistent with standards at well-managed operations
                  performing functions similar to the Services, and shall
                  provide the necessary physical security to support Supplier's
                  obligations to provide Data security under the Agreement.

                  Perform all physical security functions [...***...] at
                  facilities under Supplier's control.

                  The Supplier shall also describe how it shall design, print,
                  and assemble employee, contractor and visitor badges.

                  Supplier shall assume full responsibility for the design,
         print, and assembly of contractor and visitor badges as described in
         the Physical Security Standards and practices/policies. These
         procedures are based on the Supplier Global Standards, directed by
         SECMAN (Supplier Security Requirements Manual) and ITCS 204 (Security
         Standards For providers of Network and Computing Services) with
         specific focus on data center operations. [...***...]:

                  [...***...]

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<PAGE>

                  [...***...]

                  In addition, the following topics are reviewed and procedures
         for timely, accurate, and acceptable responses are developed to
         minimize risk or loss to both Supplier and PacifiCare.

               SUPPLIER INTERNAL PROCESSES

                    -        Emergency planning

                    -        Incident management

                    -        Information protection

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<PAGE>

                 Verification and Audit Of Functions

                  To verify that the security practices/policies and procedures
         are consistently followed, Supplier shall complete the following
         internal audits/activities and necessary resolution follow-up as
         indicated:

                Daily Audits

                     [...***...]

                Weekly Audits: [...***...]

                     [...***...]

                Access Review

                     [...***...]

                Asset Protection

                     [...***...]

                Information Protection

                     [...***...]

                Life Safety

                     [...***...]

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<PAGE>

                     [...***...]

                  Verification of Process/Procedures

                  Supplier's [...***...] verify Supplier's compliance of the
                  physical security functions (based on Standards).
                  Recommendations shall be made based on the business need or
                  possible exposure and submitted for correction/resolution. In
                  addition, [...***...].

         16.      LICENSE MANAGEMENT AND COMPLIANCE:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall deploy consistent and uniform standards in
         managing and maintaining license compliance. [...***...].

                PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall monitor, audit, and advise PacifiCare
         concerning Software license compliance. Supplier is responsible for
         providing Software for Supplier-provided applications development tools
         and systems Software for running the PacifiCare servers, distributed,
         and in-scope LAN infrastructure. Supplier shall be responsible to
         acquire the correct number of the foregoing licenses to be compliant.
         PacifiCare shall be responsible to acquire the appropriate number of
         Software licenses used for distributed applications, and for
         third-party End-User tools. Supplier shall advise PacifiCare of the
         number of users that Supplier has become aware are using the licenses
         for which PacifiCare is responsible and Supplier shall notify
         PacifiCare if such number exceeds the number of End-User as provided by
         PacifiCare. When Supplier becomes aware of the presence of unauthorized
         Software on the Equipment, Supplier shall promptly notify PacifiCare.
         Supplier shall monitor the servers and, to the extent enabled by the
         Supplier-provided enterprise management system, Supplier shall monitor
         the other Equipment for the presence of unauthorized Software.
         Supplier's responsibilities shall include the following:

                  a.       Provide periodic reporting of such license
                           information to PacifiCare, as required.

                  b.       File and track Software license agreements.

                  c.       Ensure compliance with Software licenses.

                  d.       Proactively scan for pirated Software.

                  e.       Report Software license anomalies.

                  17.      TECHNICAL SUPPORT:

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<PAGE>

                  SUPPLIER'S SOLUTION DESCRIPTION: CAPACITY PLANNING

                  [...***...] the scope of the Supplier capacity planning
         process includes and involves the following:

                     [...***...]

                  [...***...]. Supplier shall work with PacifiCare to solicit
         input from the business regarding potential performance and capacity
         impacts.

                  The objectives of the capacity planning process are to
         [...***...]. Many factors must be considered in the development of the
         optimal solution and each factor must be weighed in terms of its
         overall business impact. An optimal solution attempts to arrive at the
         best counterbalance of factors. Two of the key factors that must be
         considered, which may be mutually exclusive, are minimizing the cost of
         providing sufficient resources, and maximizing the utilization of
         resources.

                  PERFORMANCE MONITORING

                  The objectives of Supplier's performance monitoring process
         are to optimize the response time and throughput of existing IT
         resources, take corrective actions to alerts and problem requests, and
         automate performance tuning and alerts. Supplier's process includes the
         following capabilities:

                  [...***...]

                  [...***...]. During presentation of these performance reports,
         Supplier shall provide recommendations as required tO manage the
         resolution of performance issues.

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<PAGE>

                  Requests to change performance measurements, thresholds, and
         alerts are submitted via Change Management Procedures or a change order
         (if outside the scope of the contract). For any performance request,
         the appropriate calling process dictates the requirements needed from
         the PacifiCare and the procedural steps performed by Supplier when
         interfacing with the PacifiCare.

                  Supplier shall analyze the performance impact and handle
         alerts as required, and shall invoke the Problem Management process to
         resolve issues.

                  MAINTAIN SURVEILLANCE OF SYSTEM OPERATIONS AND PROVIDE
         IMMEDIATE RESPONSE TO PROBLEMS WITH CONSTANT SUPPORT THROUGH RESOLUTION

                  The [...***...] operations process, developed by Supplier, is
         an ongoing process throughout the life of the contract. [...***...].
         Supplier's objectives of its run and monitor operations process are to:

                     [...***...]

                  Supplier shall perform the activities [...***...] support the
         following operations:

                     -        Systems Operations

                     -        Batch Operations

                     -        Tape Operations

                     -        Network Operations

                     -        Online Business Applications

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<PAGE>

                  Supplier shall [...***...] process including the following
         activities:

                     [...***...]

                  For Systems Operations Supplier shall:

                     [...***...]

                  For Batch Operations Supplier shall:

                     [...***...]

                  For Media Operations Supplier shall:

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<PAGE>

                     [...***...]

                  For Network (LANs/MANs/WANs) Operations in-scope or as may be
         required to provide the requested services Supplier shall:

                     [...***...]

                  For Online Business Applications Supplier shall:

                     [...***...]

                PROVIDING CONFIGURATION MANAGEMENT:

                  Supplier shall work with PacifiCare to verify that a common
         philosophy and definition are implemented specifically for PacifiCare
         in the area of configuration management. Supplier's generic objectives
         for the control configurations process are to:

                     [...***...]

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<PAGE>

                  [...***...]

                  Supplier shall utilize four primary roles to execute the
         control configurations process.

                  [...***...]

                  These roles are included in Supplier's Base Fees and shall be
         performed by Supplier's staff.

                  [...***...]

                  [...***...]

                PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall provide all technical system support for
         operations, including storage management, system programming,
         teleprocessing systems, capacity planning, performance tuning, and
         installation and maintenance of all system Software products. The
         Supplier shall

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<PAGE>

         provide regular monitoring and reporting of system performance,
         utilization and efficiency. The Supplier shall provide technical advice
         and support to the applications maintenance and development staffs, as
         may be required. Supplier's responsibilities to provide technical
         support Services for the PacifiCare Data Center and Remote Server
         environment shall include:

                  GENERAL TECHNICAL SUPPORT.

                    a.       [...***...]

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<PAGE>

                  [...***...]

                PERFORMANCE.

                  [...***...]

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<PAGE>

                  CAPACITY PLANNING.

                  [...***...]

                  CONFIGURATION PLANNING.

                  [...***...]

         18.      DATABASE SUPPORT AND MANAGEMENT:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall provide physical data and database management
         for the PacifiCare environment. [...***...]

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<PAGE>

         [...***...]. Supplier's database system support staff shall be
         available for consultation with the application development aNd
         maintenance staff to assist in the logical design of databases for
         maximum performance and utility, and other logical database management
         issues as required.

                  Supplier's physical database management support for PacifiCare
         shall include the following:

                PHYSICAL DBA

                DESCRIPTION OF STANDARD SERVICES

                [...***...]

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<PAGE>

               [...***...]

               This applies to IDC databases both in the Data Center and in
               the IDC.

               Logical DBA services shall be provided by the Applications
               Supplier.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall be responsible for performing physical database
         administration functions, including storage management services,
         installation, maintenance, tailoring and monitoring of Database
         Software products, backup and recovery, standards, and support for the
         databases required by PacifiCare. Supplier's responsibilities to
         provide such database support and file management for Data Center and
         Remote Server Services shall include the following:

                DATABASE MANAGEMENT.  Supplier's responsibilities to provide
                physical database management planning shall include the
                following:

                Perform physical database management system ("DBMS") database
                control functions to support systems existing as of the Cut Over
                Date and planned new systems development.

                Plan for changes in the size of databases due to business growth
                and project implementation based on information supplied by
                PacifiCare, and review plans with PacifiCare on a regular basis
                for PacifiCare's comment and approval.

                Maintain, operate, and upgrade, as necessary. Automated
                monitoring tools to monitor database performance.

                Perform database shutdowns and restarts, as necessary.

                Perform reorganizations when required to optimize performance.

                DATABASE MAINTENANCE AND SUPPORT. Supplier's responsibilities to
                maintain the databases as necessary to meet the performance
                standards, maximize efficiency, and minimize outages for Data
                Center and Remote Server Services shall include the following:

                Provide physical database management support including providing
                backups and restores of data in a timely manner.

                Install, maintain and support database Software products.

                Test and implement database environment changes as approved by
                PacifiCare.

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                                       43

<PAGE>

                Maintain, update, and implement database archive processes and
                procedures to recover from an outage or corruption in a timely
                manner so as to meet PacifiCare's business requirements.

                Provide capacity planning and correct situations caused by lack
                of capacity (e.g. dataset or table space capacity events, full
                log files) in a timely manner.

                ADMINISTRATIVE SUPPORT.  Supplier's responsibilities to provide
                administrative support for Data Center and Remote Server
                Services shall include the following:

                Employ database performance analysis to confirm physical
                database requirements to support PacifiCare's business systems.

                On request, provide PacifiCare with documentation of files
                generated by the file management system, including name and
                utilization statistics.

                Provide technical advice to the application development and DBA
                staffs and assist applications development and maintenance staff
                in performing stress testing and operating system and database
                performance tuning.

                Develop, document, and maintain physical database standards and
                procedures, including database tuning.

                  Participate in determining physical database changes and
         impact of applications development and maintenance work, and implement
         necessary changes to relevant databases after PacifiCare's review and
         approval.

C.       NETWORK:

         1.       GENERAL:

                  Supplier shall assume operational and management
         responsibility for the network Services which [...***...] are described
         herein. Except as otherwise expressly provided in this Statement of
         Work, Supplier responsibilities shall [...***...] perform network
         Services in accordance with the Service Levels. Supplier shall be
         responsible for coordinating tHe network Services and [...***...] to
         perform the network Services in accordance with the Service Levels.
         Supplier shall use commercially reasonable measure to protect the
         network against unauthorized access and fraudulent use. Supplier shall
         provide Electronic Data Interchange ("EDI") support as specified herein
         and interface with PacifiCare's selected Value Added Network ("VAN")
         services providers. Supplier's operational and management
         responsibility for the [...***...].

         2.       NETWORK MANAGEMENT:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       44

<PAGE>

                  Supplier shall implement the five system management control
         (SMC) principles (availability, performance, capacity, problem, and
         change management) to manage PacifiCare's networks. Supplier shall
         utilize PacifiCare sniffers and network management tools, with the
         Supplier provided network management tools, to monitor and manage the
         WAN and LAN networks.

                  Supplier shall track each service activity through a change
         management record. Supplier shall review the approved change record in
         the context of other planned changes to verify that there are no
         scheduling or other conflicts. [...***...]. Supplier shall remain in
         contact with all involved parties until resolution is achieved. When
         the activity is completed, Supplier shall perform standard testing
         shall be performed to verify that there are no outstanding issues or
         problems. Supplier shall update the original change management and
         problem management records through the testing phase and shall be
         closed only when PacifiCare notifies Supplier of final approval.

                  Supplier shall analyzes of the PacifiCare WAN traffic and
         utilization early within the Open Enrollment period. Supplier shall
         work with the PacifiCare WAN engineers and review network data
         available [...***...] and PacifiCare tools to understand the bandwidth
         requirements for the PacifiCare network. The Open Enrollment period
         shall provide Supplier adequate time to install required WAN
         connectivity, which includes the IDC.

                  Supplier shall [...***...] within the scope of the Base Fees.

                  Supplier shall supply maintenance support contracts in line
         with agreed-to SLAs for site availability.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier's responsibilities to provide network management
         Services shall include the following:

                Manage and report on the capacity and configuration of the
                network. Act as a single point of contact for the management of
                the network. Supplier shall maintain Equipment inventories,
                locations lists, and other network documentation and
                information. Supplier shall provide such information to
                PacifiCare upon request.

                Perform the design, installation, termination, and documentation
                of all intra-building copper and fiber optic cabling for
                Ethernet, FDDI, ATM, and WAN environments.

                For new PacifiCare Service Locations, Supplier shall manage the
                physical survey of each such PacifiCare Service Location to
                determine site features, implementation readiness, and specific
                network installation needs. Physical surveys shall include:
                current services; demarcations; demarcation extensions;
                power/UPS requirements; Equipment issues; cabling and wiring.

                Install and maintain WAN connections and upgrades.

                Monitor WAN and leveraged LAN bandwidth.

                Implement network strategies.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       45

<PAGE>

                Analyze and propose more cost effective network alternatives.

                Provide management of Remote Access Service devices and
                associated transport connected to WAN / LAN environments.

                Proactively monitor routers supporting the RAS network
                components.

                Install all Remote Access Services Software in accordance with
                the Change Management Procedures.

                Conduct on-site visits to the Service Locations to review
                condition of RAS Network Components at intervals agreed to by
                both Parties.

                Provide provisioning as following:

                Order components and Transport Services per PacifiCare's
                direction.

                Configure components.

                Test and install components.

                Uninstall components.

                Manage Managed Agreements.

                Verify that components meet the design specifications.

                Affix asset tag, register incremental component, and update
                asset databases, as required.

                Install System Software at component manufacturer supported
                release levels or PacifiCare-specified release levels.

                Provide regular status information on orders, as agreed.

                At PacifiCare's expense and approval, manage spare inventory.

                Supplier to provide [...***...] for purposes of out of band
                management.

                Handle return authorization of failed items.

         3.       NETWORK OPERATIONS:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall perform centralized network monitoring at the
         Network Operations Center (NOC), which is located [...***...]. The NOC
         shall utilize a simple network management protocol (SNMP)-based tool to
         monitor the status of all LAN ANd WAN devices and connections
         throughout the PacifiCare network on a 7x24x365 basis. [...***...] The
         Network Operations CentER shall interface with the problem management
         system and with on-site network support staff to resolve problems.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       46

<PAGE>

                  Supplier shall utilize its problem management system to track
         problems; coordinate resources, including third parties; and drive
         problems to resolution. In the event that a network problem occurs,
         [...***...]. When the repair activiTY is completed, Supplier shall
         update and close the problem management record shall be updated and
         closed with PacifiCare's final approval. Supplier shall also forward
         this information to the Change Management Procedures and asset
         management process to document any resulting premise configuration
         changes.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall support in scope network operations
         functions for the LAN and WAN networks. This includes production
         monitoring, performance monitoring and problem resolution. Network
         operations and monitoring shall include support through to the end user
         device. [...***...]. Supplier's responsibilities to provide network
         operations Services shALl include the following:

                Perform operational management of PacifiCare's [...***...].

                Provide network connectivity at PacifiCare Service Locations.

                [...***...].

                Perform the following in respect of installing, upgrading and
                maintaining the network Equipment:

                [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       47

<PAGE>

                [...***...]

         4.       SNA, DECNET, AND TCP/IP TECHNICAL SUPPORT:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall provide logical design and connectivity to
         PacifiCare and PacifiCare [...***...]. Supplier shall woRK with
         communication carriers to monitor communications line usage and
         capacity to verify that sufficient bandwidth is provided to support
         PacifiCare's business and IS projects. As part of Supplier's long-range
         plan, all aspects of this environment shall be evaluated [...***...] to
         address PacifiCare's overall requirements. Changes and upgrades shall
         be coordinated by the Supplier change management team following
         established the Change Management Procedures, including presentation to
         PacifiCare IT for review and sign-off prior to implementation.

                  [...***...].

                PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall provide logical design and connectivity to
         PacifiCare and external client locations for the PacifiCare SNA and
         TCP/IP network, including support of all front-end processors and third
         party protocol conversion boxes. The Supplier shall monitor capacity,
         implement upgrades, and make SNA and TCP/IP modifications through the
         Change Management Procedures. [...***...]:

                [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       48

<PAGE>

                [...***...]

         5.       END-USER SUPPORT:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall work with PacifiCare and other vendors on
         behalf of PacifiCare to support End-Users. Supplier's help desk shall
         provide a single point of contact (SPOC) for supporting End-Users.

                  End-Users shall submit problems to the Help Desk by placing a
         call to a Supplier provided 1-800 number [...***...].

                  Supplier shall deliver the support consistent with current
         practices. This shall include resource, problem, and requirements
         analysis; and technical support for End-Users.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall provide support, advice and assistance to
         End-Users in a manner consistent with current practices in effect as of
         the Cutover Date. [...***...]:

                [...***...]

         6.       NETWORK ENGINEERING:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       49

<PAGE>

                  Supplier shall use [...***...] to monitor PacifiCare's premise
         environment and gather system responsiveness and resource utilization
         data to determine particular trends and patterns in Equipment
         performance.

                  [...***...]

                  Supplier has developed metrics that assist in determining when
         configuration and/or architecture changes are needed to create a more
         efficient network design and when Equipment upgrades are necessary.
         When Supplier identifies Equipment that is malfunctioning, is
         over-utilized, or which experiences poor response time and
         availability, Supplier shall take steps are taken to fix the network
         configuration or the Equipment.

                  To more accurately assess the growth potential of PacifiCare's
         current premise environment, Supplier's network engineers shall develop
         a plan for analysis [...***...]. This plan shall be updated through the
         Termand as applicable the Termination Assistance Period. [...***...].
         At the conclusion of the effort, Supplier shall provide PacifiCare with
         a recommendation of the Equipment, design, and connectivity
         requirements necessary to sustain optimum performance levels.

                  Supplier shall recommend the appropriate changes or upgrades
         to the network for PacifiCare's final approval. If approved, the
         recommendations shall be implemented by Supplier through the standard
         Supplier Change Management Procedures and tracked until completion.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall provide network engineering functions as
         required to meet PacifiCare's communications needs during the Term and
         during the Termination Assistance Period, including network design,
         capacity and configuration management, network optimization, efficiency
         tuning, third-party Supplier coordination, ordering and installing
         circuits and Equipment, conducting site surveys, and performing
         upgrades for network Equipment. Supplier's responsibilities to provide
         such network engineering functions shall include the following:

                Supplier shall monitor and tune the Network for efficiency and
                cost-effectiveness, intra-location Network bandwidth sizing,
                configuring requirements and coordinate with other suppliers.
                With respect to these requirements, Supplier is expected to work
                cooperatively with the third parties and PacifiCare staff to
                facilitate effective communication and implementation of the
                Services. Supplier shall coordinate all Network technical issues
                with such third parties and PacifiCare staff.

                Perform engineering functions in accordance with the Change
                Management Procedures.

                Evaluate and test network, terminal and interface Equipment.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       50

<PAGE>

                Develop acceptance test procedures for installation and changes
                to the networks, and for verifying restoration of availability
                following problems with network circuits (premise cabling) or
                Equipment. [...***...].

                Provide adequate technical resources to support the development
                of a clear, concise, strategic direction for the voice and data
                networks within the scope of the Services.

                Supplier shall implement performance management and monitoring
                tools to be used in conjunction with the trouble ticketing
                system and the asset management database to monitor the
                performance of the data network. [...***...].

                Tune and manage the network to meet requirements and Service
                Levels. [...***...].

                Perform, on an on-going basis, regular network optimization
                analyses. [...***...].

                Identify future loads on the network as requested by PacifiCare
                (but at a minimum annually) that could impact performance and to
                develop forecasts of network growth and other changes in
                response to the projected business and operational needs of
                PacifiCare. [...***...].

                Conduct network performance sampling, to include peak and
                average hour periods, as reasonably requested by PacifiCare.

                Develop network implementation plan.

                Carry out additional network design activities.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       51

<PAGE>

         7.       NETWORK CONTROL AND CONNECTIVITY RESPONSIBILITY:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall [...***...]. Upon approval from PacifiCare,
         Supplier shall order and coordinate the installation of bandwidth from
         either PacifiCare or Supplier's suppliers, depending on the procurement
         relationship that is in place. Supplier [...***...], Supplier shall
         perform acceptance testing and turnover to PacifiCare's production
         network.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier is responsible for maintenance and support of all
         network communications related Equipment and connectivity used to
         provide the Services. [...***...]. PacifiCare's review and approval
         shall be required prior to SupplieR establishing connections to
         Supplier's facilities or external networks. Supplier shall identify
         bandwidth requirements to provide the services. Supplier shall
         coordinate network technical issues with other third party suppliers.
         Supplier's responsibilities to provide network control Services shall
         include the following:

                Perform Network planning, design and supervision of local
                Service Location network backbone circuits, Networks, office
                cabling, network circuit layout and cable plant integration.

                Provide PacifiCare with single point-of-contact for PacifiCare's
                network inquiries and requests.

                Provide protocol conversion and translation as reasonably
                requested by PacifiCare.

                Install, configure, and maintain dial-up Equipment.

                Verify operation and connectivity of PC Network adapters, and
                all other directly network-connected devices. Supplier shall
                assist and support PacifiCare in specifying the appropriate
                configuration and installation process for in-scope PacifiCare
                premises Equipment that shall be attached to, and shall
                communicate over, the network. Supplier also shall perform
                configuration testing of in-scope systems.

                Provide network management services to proactively monitor
                PacifiCare's network for service degradation, [...***...].

                Coordinate network addressing. Supplier shall manage
                PacifiCare's Network address scheme and notify PacifiCare of
                limitations or capacity issues.

                Monitor physical and logical connections.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       52

<PAGE>

                Provide redundant connections as required.

         8.       NETWORK PROVISIONING:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall provide technology refresh [...***...]
         Equipment listed in Schedule 3.8(a), Transferred Assets. [...***...].
         Supplier shall provide procurement services through Supplier's standard
         procurement procedure and provide thE necessary retirement and
         replacement through standard IMAC process.

                  Supplier shall create a database of all in-scope premise
         Equipment and associated peripherals. Supplier shall then update this
         database to reflect all on-going IMAC and preventive maintenance
         activity.

                  Supplier shall also track PacifiCare's premise assets
         [...***...].

                  [...***...].

                 PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall be responsible for Equipment procurement,
         Equipment retirement and asset management support. Included is
         troubleshooting and repair of network devices at all PacifiCare
         locations at the level provided by PacifiCare as of the Cutover Date,
         [...***...]. Other Supplier responsibilities include:

                Procure network Equipment and identifying bandwidth
                requirements.

                Maintain network Equipment.

                Troubleshoot new network devices.

                Track and manage network assets.

                Perform network Equipment installations.

         9.       SOFTWARE CURRENCY, REFRESH, AND RELEASE CONTROL:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall use its standard system management control
         (SMC) processes and procedures in working with third party suppliers to
         maintain equal or better services and minimize business interruptions.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       53

<PAGE>

                  [...***...]

                  Supplier shall leverage its established working relationships
         with PacifiCare's existing vendors and suppliers with their change and
         problem management disciplines, to coordinate IMAC and maintenance
         activity. [...***...]. Supplier shaLl also provide a test plan that
         shall be used to verify the expected operation and results.

                 PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier's responsibilities shall include installing,
         maintaining, upgrading and supporting all network Software (including
         for network, routers and bridges), including firmware. Supplier shall
         interface with third party suppliers to promote compatibility of such
         connectivity products. Supplier's responsibilities to provide Software
         currency for network Services shall include the following:

                Unless otherwise directed by PacifiCare, Supplier shall install,
                maintain and upgrade Software [...***...]. Prior to the start of
                each calendar quarter, Supplier shall give notice to PacifiCare
                of all upgrades of Software that are planned to occur in the
                quarter for which notice is being given. [...***...].

                Coordinate, test, install, and support Systems and systems
                program products.

                Test operating Systems Software, coordinating with applications
                personnel and End-Users.

                In implementing changes, upgrades, or enhancements to the
                PacifiCare Software environment, Supplier shall observe the
                Change Management Procedure and shall perform installation
                planning, product installation, testing and verification. In
                addition, Supplier shall, for any Software changes, upgrades, or
                enhancements proposed to PacifiCare advise PacifiCare of any
                additional Equipment, LAN, environmental, etc. requirements
                observed during integration testing and/or otherwise known to be
                necessary for implementation of the changes, upgrades or
                enhancement. Supplier shall also:

                Demonstrate compliance with PacifiCare Corporate Information
                Technology Architecture and Technical Standards, if applicable,
                and as may be revised by PacifiCare from time to time.

                Demonstrate compliance with data security policies and standards
                as required hereunder.

                Supplier shall be responsible for network Software, [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       54

<PAGE>

                [...***...].

                Provide installation of department or End-User-specific Software
                as requested by PacifiCare. Supplier shall periodically (at
                least monthly) report to PacifiCare the installation of such
                Software.

                Supplier shall provide support, advice and assistance to
                End-Users for Software for which Supplier is responsible
                hereunder.

                [...***...].

                [...***...].

                Negotiate site license for network Software.

                Answer level 2 and 3 Software questions and problems. The Help
                Desk shall answer all level 1 support questions and problems.

         10.      REGULATORY CHANGES:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  As part of the ongoing management of PacifiCare's overall
         network services environment, [...***...].

                  As part of this process, Supplier shall:

                  [...***...]

                  Evaluate and recommend options for responding to the changes

                  Perform required voice network modifications by managing
                  PacifiCare's local and long distance as well as Equipment
                  service providers

                  Any large-scale network changes that are required [...***...]
                  shall be handled and managed on an individual project basis.
                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       55

<PAGE>

                  Supplier shall identify, evaluate and recommend network
         modifications as required to maintain compliance with local, regional
         and international regulatory changes applicable to telecommunications.
         Supplier shall perform, if requested by PacifiCare such network
         modifications and shall be responsible for performing such network
         modifications within proposed timeframes. Where third party suppliers
         must make modifications to their service or technology platform to
         achieve compliance, Supplier shall upon PacifiCare's request, and
         oversee these activities, and verify that they are performed within
         acceptable timeframes, and provide progress reports to PacifiCare at
         regular intervals. Supplier's responsibilities to regulator change
         Services shall include the following:

                Stay current on emerging governmental regulations.

         11.      TELECOMMUNICATIONS BILLING AND FINANCIAL ADMINISTRATION:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall work with PacifiCare during the Transition
         Period to understand PacifiCare's specific requirements, processes, and
         procedures that are in place; and the number of invoices that
         PacifiCare manages at this time. Once this has been accomplished,
         Supplier shall work with PacifiCare management to establish and provide
         the required processes and procedures for Supplier to follow in
         handling these bills. [...***...].

                  As part of transition, Supplier shall review the existing
         leased circuits, and work with PacifiCare to determine requirements for
         consolidating the billing of leased circuits.

                  [...***...]. During the Transition Period Supplier shall set
         up a process that is consistent with the PacifiCare requirement for the
         administration and payment of these bills.

                  [...***...]. Supplier shall also advise PacifiCare of any
         known fraudulent billing caused by improper calling or abusive use of
         telephone Equipment or the network.

                  Supplier shall not be responsible for any charges caused by
         fraudulent calling by PacifiCare.

                  Supplier shall maintain a database that shall include all
         information relating to the PacifiCare Service Locations. Supplier
         shall do the following:

                     [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       56

<PAGE>

                     [...***...]

                TELECOMMUNICATIONS FINANCIAL REPORTS

                  Supplier shall maintain all invoice information in a database.
         [...***...]. Supplier shall provide exception reports.

                  Using Supplier's vendor, Supplier shall review [...***...].

                PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  If requested by PacifiCare, Supplier shall establish and
         follow telecommunications procedures, including receipt of invoices,
         verification of charges by PacifiCare Service Location, research and
         resolution of billing discrepancies, preparation of internal chargeback
         documents and electronic files for accounting and preparation of
         invoices for approval and payment. Supplier shall support the
         technology chargeback process within PacifiCare by providing all
         necessary information to support usage/demand based technology
         charging. Supplier's responsibilities to billing and financial
         administration Services shall include the following:

                Consolidate billing for leased circuits utilizing existing
                PacifiCare tools.

                Provide information to support PacifiCare chargeback system.

         12.      TOLL / LINE CHARGES:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  The initial plan for the provisioning of telecommunications
         services shall be through the current PacifiCare carriers using the
         agreements that are in place.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  PacifiCare currently receives an aggressively discounted rate
         for toll service, frame relay, ATM, and dedicated line facilities from
         telecommunications carriers. The Supplier may elect to provide these
         services on its own or through a third party telecommunications
         carrier, provided that there is a benefit to PacifiCare. Due to the
         agreements already in place, the Supplier may continue to provide toll
         service, frame relay, ATM, and dedicated line charges through
         PacifiCare's agreements on a pass through basis with the mutual
         agreement of PacifiCare. Other Supplier responsibilities include:

                Review long distance charges.

                Review and report abuses of long distance services.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       57

<PAGE>

         13.      PREMISE VOICE SYSTEMS:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  During the Transition Period, Supplier shall work with
         PacifiCare to understand the processes and procedures in place to
         support premise voice systems. During the Transition Period and during
         the Term and Termination Assistance Period, [...***...].

                  Supplier's Help Desk solution for PacifiCare results in a
        single-point-of-contact (SPOC). The SPOC shall provide support for voice
        service and trouble requests from End-Users who are calling on behalf of
        the employees as defined by PacifiCare. For example, these callers may
        be reporting a repair problem, requesting a change in their phones or
        features, or requesting information on the use of a feature or new
        technology.

                  Supplier shall manage maintenance and installation activities,
         including changes on these systems. This shall include managing the
         process to complete the IMACs. PacifiCare shall be responsible for
         charges incurred with these vendors and for any New Equipment. Supplier
         shall respond to all IMAC work orders and shall submit them to the
         appropriate vendors for work order completion.

                  [...***...]

                  Supplier shall manage the maintenance,  [...***...].

                  Supplier shall help evaluate site improvements and system
         replacements based on a cooperatively developed priority list. System
         replacements shall be approved and paid for by PacifiCare.

                  Supplier shall manage the [...***...].

                  Supplier shall interface with all telecom vendors [...***...].
         The Supplier voice team shall help PacifiCare evaluaTe new technologies
         from the perspective of solving business problems, not changing
         technology for its own sake. [...***...].

                  Supplier shall work with the required personnel to continue
         support of PacifiCare's voice response systems environment.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       58
<PAGE>

                  Division of responsibilities between the Supplier and
         PacifiCare is described in the following table:

<TABLE>
<CAPTION>
                  --------------------------------------------------------------
                                        SUPPLIER             PACIFICARE RETAINED
                  --------------------------------------------------------------
<S>                                  <C>                     <C>
                  ASPECT ACD         [...***...]                  [...***...]

                  --------------------------------------------------------------
</TABLE>

                PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall be responsible for the planning,
          installation and maintenance of all premise voice systems.
          [...***...]. Other Supplier responsibilities include:

                Plan, implement, and administer voice systems [...***...].

                [...***...].

                Manage and maintain voice mailboxes.

                Manage cellular phone assets and third party providers.

                Manage calling card providers.

                Administer calling card distribution.

                Manage pager assets and third party providers.

                [...***...].

                [...***...].

                Document changes to the Network topology during the Term and
                during the Termination Assistance Period as the Network changes
                as a result of change activities;

                [...***...];

                Plan Voice Systems and transport provisioning [...***...].

                Perform the following Voice Systems and transport order
                management functions: ordering, installation, scheduling,
                tracking, delivery and acceptance

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       59

<PAGE>

                Use existing tools and processes to perform capacity planning
                for the voice Components and voice transport as requested by
                PacifiCare.

                Notify PacifiCare of unusual traffic patterns.

                Use existing tools and processes to provide PacifiCare with
                reports as agreed upon on performance trends.

                [...***...].

                Identify capacity related troubles [...***...].

                Develop recommendations to resolve capacity related troubles;

                Provide PacifiCare with timely notification of performance
                related troubles.

                For remote system maintenance, PacifiCare shall provide, as
                mutually agreed and at its expense, telephone lines [...***...].

         14.      WIRELESS TELECOMMUNICATION:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall work with PacifiCare to project manage the
         [...***...] pilot project for wireless electronic mail AND pager
         communications. This project is currently being managed by PacifiCare
         voice head count, which shall be transferred to Supplier for voice
         support. Supplier would use in-scope resource to continue management of
         this project.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Support covers engineering, design, procurement, programming,
         burn-in, installation, preventative maintenance, and upgrades for the
         following: hand-held radios, mobiles (including trunked), radio
         repeaters, associated Equipment (antennas, coax, duplexers, combiners,
         power supplies, etc.), peripherals (batteries, chargers, microphones,
         etc.), etc. Other Supplier responsibilities include:

                Provide wireless communication engineering and design.

                Procure, at PacifiCare's expense, install and maintain wireless
                communication Equipment and Peripherals (batteries, chargers,
                etc.).

                Program wireless communication Equipment.

                Perform burn-in of wireless communication Equipment.

                Provide preventive maintenance on wireless communications
                Equipment

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       60

<PAGE>

Comply with RF regulations.

                Perform maintenance on connecting Equipment (antennas, coax,
                duplexers, combiners, towers, etc.)

         15.      AUDIO AND VIDEOCONFERENCING:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall [...***...]. The Supplier needs to understand
         PacifiCare's current processes and procedures for auDIo and video
         conferencing support. This would need to be accomplished during the
         Transition period.

                PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  On a daily basis, Supplier shall be responsible for the
         availability and functionality of all Video Conference Equipment.
         Supplier's responsibility shall include call set-up, testing, and
         implementation of changes, bridge operation, problem determination,
         repair dispatch, and escalation of problems. Over the Term and during
         the Termination Assistance Period, as applicable, and with PacifiCare's
         approval, Supplier shall recommend automated procedures to improve on
         the processes in place as of the Cutover Date and implement these
         procedures as approved by PacifiCare. Supplier responsibilities to
         provide Video Conference services shall include:

                Interface and assist with all End-User requests for scheduling
                facilities, support, or any special needs including premises
                testing, public conference room assistance, or help with adjunct
                conference Equipment. [...***...]. SupplIEr shall provide user
                training as appropriate and approved by PacifiCare.

                To the extent available from the current systems, provide
                monthly utilization reports showing usage by location.

                Coordinate with PacifiCare's videoconference scheduler personnel
                and performing the following: call set-up, testing, monitoring,
                first level problem determination and repair dispatch for the
                videoconferencing network. Equipment and connectivity testing,
                using testing procedures, shall be performed on a daily basis to
                validate that the individual video components are working
                correctly.

                Provide capacity planning, traffic analysis (to the extent
                traffic analysis data is available from the current
                videoconferencing systems), interfacing with third party video
                suppliers and providing the services of a videoconferencing
                operations team. This shall include engineering design/support,
                managing second-level problem determination, providing on-site
                support to supervise and support Video Conferences,
                coordination, testing, problem management policies and process,
                documentation of new or changed procedures and installation of
                vendor supplied fixes to video problems.

                Set up and monitor network bridge.

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                Perform daily testing.

                Dispatch repair teams.

                Perform engineering and design support for
                audio/videoconferencing.

                Manage third party product suppliers.

                Perform daily operations of audio/videoconferencing Equipment.

                Perform maintenance and problem management to ensure all
                videoconference rooms are fully functional on a daily basis.

                Schedule audio and videoconferences.

                During transition, the Supplier shall document PacifiCare's
                processes, procedures, tools in place, and staffing for video
                and audio conferencing support. [...***...].

         16.      NETWORK ADMINISTRATION:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  During the Transition Period, Supplier shall work with
         PacifiCare to understand the network administration environment. This
         includes PacifiCare's specific requirements, tools, processes, and
         procedures currently in place for support of network administration.
         Once this is completed, Supplier shall support network administration;
         [...***...].

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall administer all network requirements and
          activities including processing change requests, administering
          passwords, monitoring performance, and supplier invoices. The Supplier
          shall administer the issuance and tracking of calling cards for
          PacifiCare. Other Supplier responsibilities include:

                Perform Data Network Software upgrades.

                Administer passwords.

                  Perform weekly back up.            [...***...]

                Monitor performance.

                Perform capacity management.

                Monitor and test Private Lines.

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                Interface with third party suppliers.

                [...***...].

                Perform trunk testing.

                Coordinate home access.

                Administer remote access card distribution.

         17.      TOLL FRAUD:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  During the Transition Period, Supplier shall work with
         PacifiCare to understand the current toll fraud environment. This shall
         include PacifiCare's specific requirements and the tools, processes,
         and procedures that are currently in place for monitoring toll fraud.
         Once this is completed, Supplier shall continue monitoring toll fraud
         at the current levels.

                  [...***...]. These service providers design their networks to
         reduce the fraudulent use of the services they provide to PacifiCare,
         including:

                     -        Outbound long distance

                     -        Inbound toll-free

                     -        Calling card

                [...***...]

                The fraud protection program shall include Supplier's management
                of monitoring and reporting for the following:

                [...***...]

                The Supplier fraud protection program shall include the
                following:

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                [...***...]

                Due to the fact that Supplier does not know the capabilities of
                all of the switches, which are in place at PacifiCare Service
                Locations, and to what extent toll fraud can be limited,
                [...***...].

                PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall monitor toll fraud. Investigations shall
         occur whenever PacifiCare exceeds a threshold and is made aware of this
         by the long distance supplier. Escalation within PacifiCare shall occur
         based upon existing standards. [...***...]. Other Supplier
         responsibilities include:

                Monitor toll usage.

                Monitor and report on calling card usage.

                Report toll abuses.

         18.      PHONE DIRECTORIES:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  During the Transition Period, the Supplier team shall work
         with PacifiCare to understand the current systems, tools, processes,
         and procedures in use to support the PacifiCare online directory
         application. Once this has been accomplished, the Supplier team shall
         maintain the current online directory as it is currently being
         supported. [...***...]. In order to maintain the online directory, the
         Supplier team shall require that the necessary PacifiCare demographic
         and HR information be supplied in an electronic form via a programming
         interface or similar mechanism. As part of the process of maintaining
         the online directory, the Supplier team shall require PacifiCare to
         validate the accuracy of the directory information being supplied.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The supplier shall provide daily updates to the directory
         database for access through the PacifiCare Intranet. Other Supplier
         responsibilities include:

                Perform directory updates and support the HR [...***...]
                interface.

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         19.      EQUIPMENT SUPPORT:

                 SUPPLIER'S SOLUTION DESCRIPTION:

                  During the Transition Period, Supplier shall work with
         PacifiCare to understand the current systems, tools, processes, and
         procedures that support the compatibility and reliability of
         connectivity products. [...***...].

                  Supplier shall review PacifiCare's current telecommunications
         related databases and bills, as well as the procurement of customer
         service records (CSRs) from all telecommunications service providers
         for all locations. [...***...].

                  [...***...]. The plan shall establish relationships and
         monitor service level agreements (SLAs) with current solutIon
         administration service providers.

                  Supplier shall cooperate with existing vendors to optimize the
         voice infrastructure at PacifiCare Service Locations.

                  STEADY STATE

                  The established telecommunications services baseline shall be
         managed by Supplier at a central PacifiCare Service Location. All
         telecommunications services shall be reviewed against the
         telecommunications baseline, approved by the Supplier billing
         specialist, and presented to PacifiCare Accounts Payable for payment to
         the telecommunications service providers. Supplier shall implement a
         centralized Change Management Procedure, and be responsible for
         ordering and terminating all telecommunications services. The
         centralized Change Management Procedure shall enable Supplier to
         maintain the telecommunications baseline on an ongoing basis. The
         telecommunications baseline shall allow Supplier to create trend
         reports for monitoring the misuse of long distance services.

                  Supplier shall research new offerings to identify the quality
         of proposed products and services from existing vendors.

                  In addition, Supplier shall project manage each system change
         out and shall monitor the testing and early working state of new
         systems.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall be responsible for all network Equipment.
         Supplier shall interface with other PacifiCare suppliers to insure the
         compatibility and reliability of connectivity products. The Supplier
         shall be responsible for preventive maintenance and shall supply a test
         plan and conform

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         to all existing change management policies and procedures before
         implementation including a complete fallback scenario. Other specific
         Supplier responsibilities include:

                Plan installation of network and environmental Equipment.

                Support and train account staff on New Equipment and scheduling
                installation.

                Resolve Equipment-related problems.

                Interface with Equipment Suppliers for planning and problem
                resolution.

                Monitor Equipment leases.

                Perform regular maintenance on network Equipment.

         20.      ELECTRONIC DATA INTERCHANGE (EDI):

                SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall manage PacifiCare's existing network
         connectivity for EDI services, [...***...].

                  Electronic EDI transmissions, both to and from external
         Trading Partners, shall be [...***...] scripting shall be developed and
         maintained by the EDI application team. Where appropriate, magnetic
         media and diskettes shall be received at a centralized location.
         Supplier understands that currently most tapes and diskettes are
         received by the IDC. Supplier shall review this process and suggest
         changes to enhance data security and integrity. [...***...]. Some
         diskettes may be handled by PacifiCare's Regional EDI teams.

                  [...***...]. Data translation shall be done by a standard
         translation Software package. This function, as well as all Trading
         Partner Communications, shall be the responsibility of the Regional EDI
         departments. [...***...]. Maintenance Of the scripts that move this
         data to and from the transaction applications is the responsibility of
         the application support teams.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall process all Electronic Data Interchange
         (EDI) tapes and communications. This includes sending/receiving data
         to/from Value Added Networks (VANs), direct connects and other regional
         PacifiCare EDI processing centers, [...***...]. Other Supplier
         responsibilities include:

                Process EDI tapes.

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<PAGE>

                Manage bandwidth and line speeds for effective EDI transfers.

         21.      CIRCUIT AND TRANSPORT COSTS:

                PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall act as PacifiCare's agent to obtain
         long-distance in-bound/out-bound telephone service, credit card
         services, 800 services, and cellular phones. As such, Supplier shall
         monitor Supplier staff to preclude toll charges unrelated to provision
         of Services and also obtain:

                Long-distance in-bound and out-bound telephone service.

                Credit card services.

                800 services.

                Cellular phone services.

                Pager services.

         22.      HOURS OF OPERATION:

         ALL SYSTEMS OPERATION FUNCTIONS OF THE SERVICES DESCRIBED IN THIS
         SECTION SHALL BE PROVIDED 24 HOURS PER DAY, 7 DAYS PER WEEK AS
         APPROPRIATE (EXCEPT FOR SCHEDULED MAINTENANCE WINDOWS AND NON-SCHEDULED
         MAINTENANCE WINDOWS AGREED TO IN ADVANCE BY PACIFICARE).

D.       DISTRIBUTED COMPUTING:

         1.       GENERAL:

                  As of the Cutover Date, Supplier shall assume responsibility
         for the operation, management and support of PacifiCare's Distributed
         Computing and LAN environments, including [...***...]. Supplier shall
         participate in and support PacifiCare's project management and
         technology planning and management operations.

         2.       END-USER SUPPORT:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  The Help Desk shall be Supplier's single-point-of- contact
         (SPOC). This Help Desk shall be the primary focal point for
         PacifiCare's End-Users to access all services provided by Supplier,

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<PAGE>

         whether from Campus, Remote, or home office locations. These calls
         include proprietary applications, voice, data, problems, and requests,
         as required.

                PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall utilize a [...***...]. Supplier's
         responsibilities to provide End-User support Services shall include the
         following:

                Monitor system operations (24x7) and provide appropriate
                response to problems and continue support through resolution as
                required to meet scheduled availability.

                Provide problem management, including second-level support
                through the Help Desk and dispatch of support specialists to the
                End-User location as necessary to identify and resolve problems.

                Perform maintenance on Equipment and Software as necessary for
                the Equipment and Software to operate in accordance with its
                specifications

                Supplier shall perform trouble shooting in the appropriate
                manner to effectively identify the problem and its scope.

                [...***...].

                Manage Supplier subcontractors responsible for problem
                resolution.

                Provide support for End-Users (including End-Users who are
                traveling or remotely accessing LAN-based services or a
                non-connected site), including access to the Help Desk second
                level technical support.

                Provide End-User support and problem resolution for standard
                (approved list) and non-standard Software as defined in Schedule
                14.2(a) and 14.2(b).

                Coordinate with Managed Agreements suppliers to resolve
                Equipment and Software problems.

                [...***...]

         3.       INSTALLATION AND REMOVAL:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall provide the requested Services as defined via
         the Supplier IMAC processes/services detailed in Schedule 17 of the
         Agreement. Supplier shall coordinate LAN cabling and wiring projects.

                                              * CONFIDENTIAL TREATMENT REQUESTED

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<PAGE>

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall deploy new file servers, print servers,
      infrastructure Equipment and related Software as required under the
      Agreement. [...***...]. Supplier shall configure the Equipment within tHe
      pre-defined technology standards for the business, transport the Equipment
      to the location where it shall be installed, coordinate with the
      appropriate departments (internal. and/or external to PacifiCare) to
      validate that proper network connectivity is obtained, install the
      necessary Software and Data, test the Equipment after implementation to
      include file open and print routing capabilities, install/connect
      associated Peripherals, implement an appropriate backup mechanism and
      coordinate the installation with the designated PacifiCare personnel.
      Supplier shall affix an asset identifier tag to the asset and enter the
      asset management information as described in Section H.27, Asset Inventory
      Management and Maintenance, of this Statement of Work. Supplier's
      responsibilities for installation and removal shall include the following:

            [...***...].

            [...***...].

            [...***...].

      4.    INFRASTRUCTURE MAINTENANCE:

            SUPPLIER'S SOLUTION DESCRIPTION:

            As of Cutover Date, the Supplier shall be responsible for the
      performance of the following activities:

            -     Supplier shall keep the Software current [...***...] based on
                  PacifiCare standards.

            -     As part of the problem management process, if a Software
                  problem is detected in one area of the Enterprise that may be
                  applicable to others, Supplier shall work with PacifiCare to
                  schedule Software fixes to all appropriate copies of that
                  Software in an effort to avoid future issues. [...***...]

            -     Supplier shall monitor the distributed computing
                  infrastructure to keep track of problems within it. Through
                  monitoring, [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       69.
<PAGE>
            [...***...]. The physical cable plant can be monitored BY analyzing
            LAN capacity and performance. Non-intelligent hubs can be monitored
            by checking for devices on either side of the Hub.

            -     Supplier shall use [...***...] for the LAN/Desktop distributed
                  computiNg environment that shall aid in problem identification
                  and resolution activities.

            -     Supplier shall provide PacifiCare with Equipment maintenance
                  services. Equipment/Break/Fix problems shall be logged by the
                  Help Desk and an Supplier dispatch/coordinator shall schedule
                  with PacifiCare user.

            -     During the Transition Period, Supplier shall work with
                  PacifiCare to identify and document the mix of Software
                  products and versions currently running within the
                  organization. Following this data collection process, Supplier
                  shall work with PacifiCare to define a subset of those
                  products that shall form the approved list of Software
                  products and shall be documented in Schedules 14.2(a) and
                  14.2(b).

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall recommend solutions and implement mutually agreed
      upon processes and procedures to improve the efficiency and reliability of
      the Distributed Computing and to optimize the overall infrastructure and
      to monitor network/server/workstation parameters. Supplier shall be
      responsible for correction of Distributed Computing problems resulting
      from malfunctions in system Software and/or Equipment. [...***...].
      Supplier's responsibilities for installation and removal shall include the
      following:

            Coordinate maintenance services for network LAN server wiring with
            Managed Agreement.

            Providing maintenance services for user Equipment wiring.

                  Analyze expected life of the Equipment versus technology
            refresh.

      5.    EQUIPMENT MAINTENANCE AND SUPPORT:

            SUPPLIER'S SOLUTION DESCRIPTION:

            Through the problem determination process, the Help Desk agent shall
      determine support required for the Equipment. A ticket shall be opened by
      Supplier and a Supplier technician dispatched to the End-User's location.
      The technician shall contact the End-User and verify the

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       70.
<PAGE>
      problem through documented processes and available tools. When necessary,
      the technician shall coordinate a visit to the End-User's workstation to
      resolve the problem. After problem resolution, the technician shall
      complete the problem ticket and update its status.

           PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall provide maintenance for Equipment for which Supplier
       is otherwise responsible hereunder as necessary to keep such Equipment in
       good operating condition and in accordance with manufacturer's
       specifications or other agreements as applicable, so that such Equipment
       shall qualify for the manufacturer's standard maintenance plan upon sale
       or return to a lessor. [...***...]. Such maintenance shall be performed
       in accordance with the Change Management Procedures, so as to minimize
       the disruption to PacifiCare's normal business processes. Supplier's
       responsibility for such functions shall also include the following:

            Supplier shall manage the third party service providers that provide
            support.

            With respect to distributed Equipment for which Supplier is
            otherwise responsible hereunder, Supplier shall provide break/fix,
            support, advice and assistance to End-Users. Supplier shall correct
            all problems associated with failure or maintenance of such
            Equipment. Supplier shall install PacifiCare-supplied upgrades for
            such distributed computing-related Equipment at the Service
            Locations. Supplier shall maintain a level of documentation that
            reflects the complexity and diversity of the environment and
            facilitates the Equipment support process.

            Supplier shall be responsible for coordinating rollouts and upgrades
            of Equipment. Supplier shall be responsible for coordinating any
            testing, scheduling, and installation integration of these products.
            Supplier shall also perform full testing after installation and
            provide proper back-out procedures. If installation occurs after
            hours, Supplier shall also make available on-site support the next
            working business day in order to provide the necessary support.

            Supplier shall procure in accordance to the Change Control
            Procedures or Change Management Procedures as appropriate (if
            requested by PacifiCare), install and maintain Equipment,
            Peripherals, file servers, gateways, and network / communications
            Equipment. With respect to Equipment connected to the network,
            Supplier shall maintain Equipment, Peripherals, file servers, and
            gateways.

            [...***...].

            Supplier shall maintain an effective inventory of all spare parts
            and Equipment used to support the Equipment for which Supplier has
            maintenance responsibility, and track such inventory in an inventory
            management database system. This inventory shall be adequate to
            allow Supplier to meet or exceed the Service Levels.

            Supplier shall perform in scope operations required to support the
            cascading of Equipment associated with providing the Services
            throughout PacifiCare's operations in accordance with the Refresh
            Schedule. [...***...].

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       71.
<PAGE>
            [...***...]
            Supplier shall monitor and report on Equipment leases to the extent
            the current lease information is supplied by PacifiCare.

      6.    SOFTWARE SUPPORT:

            SUPPLIER'S SOLUTION DESCRIPTION:

            The Supplier team's Software support is initiated through the
      single-point-of-contact (SPOC) Help Desk.

            As necessary, the Supplier's or PacifiCare's level 2 Software
      support technicians shall be engaged if more in-depth support is required.
      [...***...] for support of in-scope PacifiCare developed applications. If
      there are [...***...] from PacifiCare, as these shall be borne by
      PacifiCare.

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            The Supplier shall provide infrastructure support including level 1
      Help Desk for PacifiCare Software, distributed computing productivity tool
      development, NOS support for all environments, server-based application
      support, and computing Software infrastructure support (e.g., shared
      resources, menu systems, etc.). Supplier's responsibilities for Software
      support include the following :

            Provide Software support and install third-party supplied
            corrections for third party Software problems, install third party
            provided Software patches as required. Provide support for
            PacifiCare Software, distributed computing productivity tools, NOS
            (Network Operating System) support and firmware for all Services,
            server-based application support, and computing Software
            infrastructure support (e.g., shared resources, menu systems, etc.).

            With respect to PacifiCare-developed applications, this shall
            include installing upgrades, distributing Software and providing
            first level support from the Help Desk.

            Install Software for which Supplier is responsible according to the
            applicable specifications as well as PacifiCare Standards.

            To the extent enabled by the PacifiCare-approved enterprise
            management system provided by Supplier, define and check for
            particular Software signatures, to monitor the use of Software
            developed by the applications development and maintenance group, and
            to check the presence and version of Software present on a
            particular device.

            [...***...].

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       72.
<PAGE>
            Coordinate any testing, scheduling, or systems integration on the
            Supplier-controlled systems of PacifiCare Software, which have been
            unit tested but not integration tested. Supplier shall coordinate
            rollouts and upgrades and provide proper back-out procedures of all
            Supplier- introduced third party Software as well as for all
            upgrades and new releases of any internally developed applications.
            Supplier, with PacifiCare's cooperation, shall fully test the
            applications before rollout.

            Recommend appropriate methods and tools to improve and increase
            automation in PacifiCare's distributed computing environments, and
            work with PacifiCare to research, evaluate and implement such tools
            and methods. Supplier shall utilize productivity tools, utilities,
            and create batch file.

            Maintain master copies of the PacifiCare Standard Software suite in
            a secure, central location.

            Support PacifiCare Software.

            Support the network operating system and server-based applications.

            Develop productivity tools and utilities.

            Test for compatibility between third party products and LAN NOS.

            Coordinate and implement application rollouts and /or upgrades of
            PacifiCare Software. This includes: documentation of application
            roll-out in change control system, coordination of proper testing
            for given environment, scheduling implementation times and on-site
            support after the release has been accomplished.

      7.    SOFTWARE CURRENCY, REFRESH, AND RELEASE CONTROL:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier's responsibilities shall include installing, maintaining,
      upgrading and supporting all distributed systems Software including
      firmware. Supplier shall interface with third party suppliers to promote
      compatibility of such distributed systems products. Supplier's
      responsibilities to provide Software currency Services shall include the
      following:

            Unless otherwise directed by PacifiCare, Supplier shall install,
            maintain and upgrade Software for which Supplier is otherwise
            responsible hereunder so that such Software remains within one
            generation of the current release and remains on a supported
            release. Prior to the start of each calendar quarter, Supplier shall
            give notice to PacifiCare of all upgrades of Software that are
            planned to occur in the quarter for which notice is being given. The
            Parties shall mutually agree on the timing for implementation of
            upgrades.

            Coordinate, test, install and support Systems and systems program
            products.

            Test operating Systems Software, coordinating with Application
            Supplier and End-Users.

            In implementing changes, upgrades, or enhancements to the PacifiCare
            Software environment, Supplier shall observe the Change Management
            Procedures and shall perform installation planning, product
            installation, testing and verification. In addition,

                                       73.
<PAGE>
            Supplier shall, for any Software changes, upgrades, or enhancements
            proposed to PacifiCare advise PacifiCare of any additional
            Equipment, LAN, environmental, etc. requirements observed during
            integration testing and/or otherwise known to be necessary for
            implementation of the changes, upgrades or enhancement. Supplier
            shall also:

            Adhere to PacifiCare Corporate Information Technology Architecture
            and Technical Standards, if applicable.

            Adhere to data security policies and standards as required
            hereunder.

            In the telecommunications environment for which Supplier is
            responsible, Supplier shall be responsible for network Software,
            including those Software products required for connectivity.
            Supplier shall interface with other PacifiCare suppliers to promote
            compatibility of connectivity products, and shall manage the
            subcontractors that provide Software support to network products for
            which Supplier is otherwise responsible hereunder. Unless otherwise
            directed by PacifiCare, Supplier shall manage its upgrades to be at
            the current level or one generation below the current level for each
            Software component for which Supplier is responsible, provided that
            such components that are at such level as of the Effective Date
            shall, at PacifiCare's option, be upgraded to that level of
            currency.

            Provide installation of department or End-User-specific Software as
            requested by PacifiCare. [...***...].

            Supplier shall provide support, advice and assistance to End-Users
            for Software for which Supplier is responsible hereunder.

            [...***...].

            To the extent enabled in the PacifiCare approved enterprise
            management system provided by Supplier, Supplier shall monitor use
            of licensed Software, including license metering and tracking.

      8.    OPERATIONS SUPPORT FOR NEW SERVICES:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            The Supplier shall interface between the groups implementing changes
      and the production support function in accordance with the Change
      Management Procedures, assuring compliance with standard documentation,
      necessary scheduling, and orderly turnover. Supplier's responsibilities
      for operations support for New Services shall include:

            Obtaining approvals of production testing and installation
            timetables from designated PacifiCare representatives.

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                                       74.
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            Develop comprehensive operational documentation.

            Facilitate orderly turnover for Distributed Systems and applications
            to include developing fallback procedures.

            Support for the introduction of new Platforms and applications in
            accordance with the Change Management Procedures: [...***...].

            Interface between the groups implementing changes and the production
            support function and designated PacifiCare support groups.

            Facilitate orderly turnover for servers and applications to
            designated PacifiCare representatives.

            Maintain documentation standards, task lists and run sheet updates.

            Inform all affected operations staff and designated PacifiCare
            representatives of changes to the environment.

            Provide project management and technical expertise to optimize
            available resources.

            Provide coordination and integration of New Services.

      9.    SERVER OPERATIONS:

            SUPPLIER'S SOLUTION DESCRIPTION:

            Supplier shall implement a standard set of tools across the LAN
      server environment that shall allow for server up/down monitoring (24x7),
      performance and capacity management, and remote control. This standard
      toolset shall be based on the [...***...], which ties into the Help Desk
      process for sending system status and error alerts.

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall be responsible for server operations Services. The
      Supplier shall assume all LAN server operations responsibilities. This
      includes monitoring all LAN processes, alarms, environmental controls, and
      transmissions/reception of polling information to and from outside
      organizations. [...***...]. Supplier's responsibility for server Services
      shall include the following:

            Maintain PacifiCare-supplied spare servers to be properly
            configured, fully functional and operationally ready for use when
            needed.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       75.
<PAGE>
            Install new LAN Equipment (including the LAN and file servers) based
            on a PacifiCare-specified refresh cycle and Software, as requested
            or approved by PacifiCare. [...***...].

            Maintain, install upgrades, configure and fine-tune LAN network
            operating system Software.

            Repair problems in a manner consistent with the problem management
            process and provide repair and performance reports.

            Install PacifiCare-provided backup server, gateway, tape, disk and
            other Equipment required to maintain a LAN support level as
            necessary to meet PacifiCare's business requirements and in
            accordance with applicable Service Levels.

            Update and maintain shared-use file server libraries of PacifiCare's
            DOS, Windows, and NT Software.

            Install and provide operational support for PacifiCare's standard
            office applications Software as [...***...].

            Install and support sufficient data storage and processing capacity
            provided by PacifiCare to facilitate the use of such applications
            Software.

            To the extent enabled by the PacifiCare-approved enterprise
            management system provided by Supplier, monitor use of licensed
            Software, including metering and license tracking.

            [...***...].

            Provide routine administrative services, such as End-User and print
            queue setup, print table setup, rights, administration and password
            administration, to enable shared use of departmental data and
            applications.

            Audit LAN file server rights and privileges on at least a quarterly
            basis, and report the results to PacifiCare. Supplier shall
            facilitate audits by PacifiCare's internal and/or external auditors.

            Assist individual departments and End-Users in lost or damaged file
            recovery from the file server backups, if the End-User's backup is
            corrupted or unavailable. Reset, or, with respect to Service
            Locations where Supplier is not obligated to provide on-site
            personnel, assist PacifiCare's on-site staff to reset, security
            passwords for End-Users according to security procedures approved by
            PacifiCare.

            [...***...]

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       76.
<PAGE>
            Deploy new distributed computing and LAN services, on a project
            basis, including providing Services to support distributed computing
            environment initiatives, remote computing, and Internet / Intranet
            usage.

            Continue automating the operational environment in an effort to
            reduce errors and increase efficiency. Supplier shall cooperate with
            PacifiCare to research and implement automated tools to improve
            Service Levels and/or performance of the distributed computing
            environment. Tool selection shall be influenced by PacifiCare
            standards and technical direction. [...***...].

            Maintain and update the operational documentation for in scope
            operations procedures and services.

            Proactively prepare for user deadlines per customized user
            requirements.

            Operate contingency servers at contingency sites and support
            contingency tests.

            Provide node/host information to Suppliers, check and reset ports.

            Reset modems.

            Perform LAN traffic measurements.

            Interface with other networks and Suppliers to provide problem
            resolution.

            Analyze and correct in scope distributed computing and/or LAN
            problems.

            Develop tools and processes to provide automated systems management.

            Provide remote control Software distribution.

            SYSTEMS MANAGEMENT:PACIFICARE'S FUNCTIONAL REQUIREMENT:

            The Supplier shall develop tools and processes to allow automated
      and remote systems management of the distributed computing environment.
      Processes shall include Software distribution, backups, performance
      measurement, tuning, license and asset management, etc. The Supplier may
      adopt/adapt any of PacifiCare's existing management tools. The Supplier
      shall maintain servers, as well as monitor for and control Viruses.
      Supplier's responsibility for systems management Services shall include
      the following:

            Consistent with the Transition Plan and during the Term and during
            the Termination Assistance Period, evaluate (when requested)
            implement and maintain tools and processes for automated and remote
            systems management and restoration of LAN servers and client
            distributed computing machines. [...***...]

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       77.
<PAGE>
            [...***...].

            Measure LAN traffic and make load-balancing recommendations.

                  Install, update, operate and maintain Virus protection
                  Software as described in the Section H.19, Virus Protection of
                  this SOW.

                  Provide level two and three network management support.

            Provide technical assistance on communication protocols and systems.

            Monitor in scope network devices, including file servers, bridges,
            and communications servers.

            Provide tuning to improve performance and utilization.

      10.   ADMINISTRATION AND DOCUMENTATION:

      SUPPLIER'S SOLUTION DESCRIPTION:

            Supplier shall establish and then maintain documentation, with
      PacifiCare's concurrence.

            During the Transition Period, transfer of knowledge relating to
      procedures that are specific to PacifiCare shall be merged with current
      Supplier procedures and then documented for use in support of PacifiCare.
      [...***...]. During this time Supplier shall also produce documentation
      that shall detail the processes for [...***...].

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            The Supplier is responsible for supporting in scope aspects of
      administration and documentation for the distributed computing
      environment. This includes ID and password administration for the LAN,
      electronic mail and applications environment, setting up new user accounts
      and groups with appropriate security access, synchronizing electronic mail
      accounts, assigning/resetting passwords, modifying accounts, deleting
      accounts, and assigning and maintaining network addresses. Supplier's
      responsibilities for administration and documentation shall include the
      following:

            Perform LAN administration functions, including: development,
            establishment, installation, and maintenance of directories,
            directory structures and naming conventions; purging records, file
            and old user accounts, as appropriate, and restoration of deleted
            files upon PacifiCare's request.

            Perform user-ID administration for the LAN, electronic mail, and the
            database applications and applications environment for which
            Supplier is otherwise responsible hereunder, setting up of new user
            accounts with appropriate security access, synchronization of

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       78.
<PAGE>
            electronic mail accounts, assigning/resetting of passwords,
            modification of accounts, deletion of accounts, the dial-up access
            to the LAN, and assignment of IP addresses.

            As soon as practicable, create and maintain reasonable documentation
            for in scope applications and End-User procedures that affect
            operations.

            Support in-scope network operations functions, [...***...].

            Perform in-scope network administration and documentation functions,
            [...***...].

            Interface between the groups implementing changes and the production
            support function, to support compliance with standard documentation
            processes and orderly turnover.

            Maintain and update on an on-going basis, and deliver to PacifiCare,
            in-scope network Equipment inventories, logical topology diagrams,
            and other network documentation and information.

            Maintain a comprehensive network management cross-reference
            database.

            Manage, prioritize and coordinate improvement initiatives throughout
            the technology organization so that they are consistent, achievable
            and are not competing for scarce resources.

      11.   DISASTER RECOVERY SERVICES:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Refer to same named section in the Cross Functional Services portion
            of this SOW.

      12.   MEDIA OPERATIONS AND ADMINISTRATION:

            SUPPLIER'S SOLUTION DESCRIPTION:

            Supplier shall leverage as much of the current PacifiCare investment
      as possible regarding the processes, tools, and procedures PacifiCare uses
      to perform off-site removable data storage media responsibilities. In
      addition, Supplier shall [...***...].

            The media library processes and procedures at PacifiCare or Supplier
      locations shall be conducted in accordance with required security and
      audit controls and shall comply with the specific regulations for media
      management.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       79.
<PAGE>
            Reports of off-site removable data storage media shall be produced
      [...***...], as mutually agreed to by PacifiCare and Supplier. [...***...]
      informing PacifiCare of its off-site removable data storage media,
      Supplier shall use the respective tools of the vendor tape storage
      products to produce reports.

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            The Supplier shall assume in scope media management system, and
      media library operations responsibility. The Supplier shall be responsible
      for operating and supporting a media management system, media library
      operations, shipping and receiving media to and from off-site facilities.
      The Supplier shall assume operational and financial responsibility for
      off-site media storage, [...***...]. Other specific Supplier
      responsibilities include:

            Respond to media mount requests.

            Maintain integrity of media library system.

            Monitor media Equipment for malfunction.

            Monitor media usage.

            Perform daily media Equipment maintenance.

            Prepare and mail media.

            Initialize new media.

            Perform backups and restores.

            Execute off-site storage procedures.

            Define off-site storage requirements.

            Coordinate off-site storage functions.

            Comply with physical specifications, retention periods, and
            security.

            Review compliance with physical specifications, retention periods
            and security.

            Assure compliance with PacifiCare or government requirements.

      13.   ORDER FULFILLMENT:

            Refer to same named section in the Cross Functional Services portion
            of this SOW.

      14.   TECHNOLOGY (EQUIPMENT) REFRESH:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       80.
<PAGE>
            The Supplier shall refresh the distributed computing environment
      according to the Refresh Schedule.

            The Supplier shall deploy new distributed computing technology and
      services to meet PacifiCare's business requirements as required, requested
      and approved by PacifiCare on a project basis. Supplier shall perform such
      technology refresh functions in accordance with the Refresh Schedule and
      in general accordance with the following:

            Upgrade, maintain, and support Supplier's distributed computing
            Equipment.

            Coordinate comprehensive technology refresh.

            Deploy new distributed computing Equipment and LAN services to meet
            business requirements.

            Analyze emerging distributed computing and LAN Equipment.

      15.   STANDARD EQUIPMENT AND SOFTWARE:

            SUPPLIER'S SOLUTION DESCRIPTION:

            As a transition activity, Supplier shall work with PacifiCare to
      define and deploy PacifiCare standard images. Images shall be maintained
      by Supplier using a pool of dedicated resources to verify both their
      currency and validity. Changes to the defined images shall be addressed
      through the Change Management Procedures.

            Supplier staff shall distribute image changes according to a
      mutually agreed to Software distribution process.

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall work with PacifiCare to design standard Equipment and
      Software configurations for the Distributed Computing environment, and
      assume responsibility for collecting necessary input from PacifiCare
      personnel. The PacifiCare Standard in effect as of the Effective Date and
      may be modified and amended as approved or requested by PacifiCare and
      there may be more than one standard in effect at the same time. Once
      approved by PacifiCare, Supplier shall document, implement and communicate
      the standard throughout the supported environment. The implementation plan
      shall include the necessary Supplier and PacifiCare testing and systems
      integration with in-scope applications in the current environment.
      Supplier shall perform such standard Equipment and Software functions in
      accordance with the following:

            Identify areas of non-compliance.

            Evaluate new and emerging standards and business requirements.

      16.   LAB TESTING:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

                                       81.
<PAGE>
            The Supplier shall be responsible for thorough testing of new
      versions of Equipment and Software prior to recommending the
      implementation of these products. This includes the construction and
      maintenance of laboratory systems that simulate PacifiCare's production
      environment. Supplier shall provide results of testing upon request.
      Supplier shall perform such laboratory testing functions in accordance
      with the following:

            Provide laboratory environments that simulate PacifiCare's
            production environment.

            Provide unit testing, systems integration testing, LAN/WAN
            connectivity testing, load testing and application interconnectivity
            testing on new versions of Equipment and Software.

            Provide a test plan for New Equipment.

      17.   SPARES INVENTORY:

            SUPPLIER'S SOLUTION DESCRIPTION:

            Supplier shall populate its inventory database with PacifiCare's
      current Equipment and Software inventory. Supplier shall update and verify
      this inventory through calls to the Help Desk (information about the end
      user's workstation shall be verified), auto discovery, and the IMAC
      process.

            [...***...], Supplier shall use existing spare inventory, if
      available.

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier's responsibilities include maintaining an inventory of
      spare parts for in scope Equipment (which includes printers, desktops,
      laptops and servers) for which Supplier is otherwise responsible to
      maintain hereunder in a quantity that is sufficient to provide replacement
      Equipment and associated Peripherals as required and provide periodic
      reports on same.

E.    DESKTOP

      1.    GENERAL:

            [...***...], Supplier shall assume responsibility for the operation,
      management and support of PacifiCare's Desktop environment, including
      PacifiCare's Desktop / Laptop PC Equipment and Software. [...***...],
      Supplier shall be responsible for Services relating to Desktop
      environment.

      2.    END-USER SUPPORT:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       82.
<PAGE>
            The Supplier shall provide services that are tailored to the
      individual needs of internal clients in a Campus, Remote and home office
      environment. [...***...]. Supplier's responsibilities to provIDe End-User
      support Services shall include the following:

            Monitor system operations and provide appropriate response to
            problems and continue support through resolution as required to meet
            scheduled availability.

            Provide problem management, including second-level support through
            the Help Desk and dispatch of support specialists to the End-User
            location as necessary to identify and resolve problems.

            Supplier shall provide quotes for desktop Equipment to PacifiCare
            customers, as requested per specified Service Levels. Manage the
            fulfillment process, including order receipt, order entry, order
            procurement, order status, and reporting. Oversee the services of
            the value added reseller, who, under a separate agreement, fills the
            order, images the system, installs any additional Equipment or
            Software and delivers the system to the customer. Supplier will
            utilize current Standard technology and desktops to be replaced
            according to the Refresh Schedule.

            Perform maintenance on Equipment and Software as necessary for the
            Equipment and Software to operate in accordance with its
            specifications.

            Supplier shall perform trouble shooting in the appropriate manner to
            effectively identify the problem and its scope. In the event
            Supplier must replace a PC in order to conduct a repair, the
            Supplier shall be responsible for copying data from the hard drive
            of the malfunctioning PC and updating the asset management system
            accordingly.

            Provide break-fix field service at the PacifiCare Service Locations
            and home office environments. [...***...].

            Supplier shall be responsible for problem resolution.

            Provide support for End-Users (including End-Users who are traveling
            or remotely accessing LAN-based services or a non-connected site),
            including access to the Help Desk second level technical support.

            Supplier shall provide that, at a minimum, LAN-connected PCs,
            [...***...].

            Provide End-User support and problem resolution for standard and
            non-standard Software, listed in Schedules 14.2(a) and 14.2(b).

            Coordinate with third party suppliers to resolve Equipment and
            Software problems.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       83.
<PAGE>
            Perform End-User reporting - including feedback on problem tracking,
            request tracking, project updates and chargeback information and
            technology budget planning (provide capital expense plans in
            anticipation of upgrades)

      3.    INSTALLATION AND REMOVAL:

            SUPPLIER'S SOLUTION DESCRIPTION:

            Supplier shall provide the requested services as described in the
      IMAC process, Schedule 17 of the Agreement.

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall deploy new PCs, related Software, file servers, print
      servers and infrastructure Equipment, per the Agreement, to meet
      PacifiCare's business and Application requirements and otherwise in
      accordance with the Service Levels, requested and approved by PacifiCare.

            These activities shall include the design (where appropriate) and
      installation of Supplier-owned new desktop, laptop and printer
      environments.

            These activities also shall include the implementation of a single
      workstation for a new End-User, installation of PacifiCare-supplied
      replacements for workstations for an entire department, implementation of
      a single network (segment, ring) for a new Application or user community,
      installation of PacifiCare-supplied upgrades, upgrades to a new networking
      environment, or installations/upgrades (as provided by PacifiCare) to
      other synchronous and asynchronous network services. Installation of the
      upgrades that are outside the scope of the Services as described in the
      Agreement, Section 3.1. shall be considered a new project.

            For each PC that replaces an existing PC, Supplier shall copy
      applications and data from the existing PC's internal hard drive onto the
      internal hard drive of the replacement PC. Supplier shall configure the
      Equipment within the pre-defined technology standards for the business,
      transport the Equipment to the location where it shall be installed,
      coordinate with the appropriate departments (internal. and/or external to
      PacifiCare) to validate that proper network connectivity is obtained,
      install the necessary Software and Data, test the Equipment after
      implementation to include file open and print routing capabilities,
      install/connect associated Peripherals, implement an appropriate backup
      mechanism and coordinate the installation with the designated PacifiCare
      personnel.

            Supplier shall affix an asset identifier tag to the asset and enter
      the asset management information as described in Section H.27 of this
      Statement of Work.

            [...***...]. Supplier's responsibilities for installation and
      removal shall include the following

            Arrange for non-network Remote site installation and install
      non-network Software for the users in Remote sites.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       84.
<PAGE>
            Coordinate the installation of personal computers, Peripherals, and
      LAN-based Equipment.

            Provide a channel to dispose or cascade Supplier Equipment and
      Software no longer required.

      4.    EQUIPMENT MAINTENANCE AND SUPPORT:

            SUPPLIER'S SOLUTION DESCRIPTION:

            To obtain desktop support, End-Users shall place calls to the
      Supplier Help Desk for problems or service requests.

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall provide, or arrange for qualified third parties to
      provide maintenance for Equipment for which Supplier is otherwise
      responsible hereunder as necessary to keep such Equipment in good
      operating condition and in accordance with manufacturer's specifications
      or other agreements as applicable, so that such Equipment shall qualify
      for the manufacturer's standard maintenance plan upon sale or return to a
      lessor. PacifiCare shall be responsible for additional costs and expenses,
      if any, to bring PacifiCare-supplied Equipment up to such standards if
      such Equipment doesn't meet such standards on the Effective Date. Such
      maintenance shall be performed in accordance with the Change Management
      Procedures, so as to minimize the disruption to PacifiCare's normal
      business processes. Supplier's responsibility for such functions shall
      also include the following:

            Supplier shall manage the third party service providers that provide
            support until termination of Managed Agreement.

            With respect to distributed Equipment for which Supplier is
            otherwise responsible hereunder, Supplier shall provide break/fix,
            support, advice and assistance to End-Users. Supplier shall correct
            problems associated with failure or maintenance of such Equipment.
            Supplier shall install PacifiCare-supplied upgrades for such
            distributed computing-related Equipment at the Service Locations.
            Supplier shall maintain a level of documentation that reflects the
            complexity and diversity of the environment and facilitates the
            Equipment support process.

            Supplier shall be responsible for coordinating rollouts and upgrades
            of Equipment. Supplier shall be responsible for coordinating any
            testing, scheduling, and installation integration of these products.
            Supplier shall also perform testing after installation and provide
            proper back-out procedures. If installation occurs after hours,
            Supplier shall also make available on-site support the next working
            business day in order to provide the necessary support.

            Supplier shall procure in accordance with the Change Control
            Procedures or Change Management Procedures as appropriate (if
            requested by PacifiCare), install and maintain Equipment,
            Peripherals, file servers, gateways, and network / communications
            Equipment. With respect to Equipment connected to the network,
            Supplier shall maintain Equipment, Peripherals, file servers, frame
            relay circuits, gateways, network / communications Equipment.

                                       85.
<PAGE>
            [...***...].

            Supplier shall maintain an effective inventory of spare parts and
            Equipment used to support the Equipment for which Supplier has
            maintenance responsibility, and track such inventory in an inventory
            management database system. This inventory shall be adequate to
            allow Supplier to meet or exceed the Service Levels.

            Supplier shall perform operations required to support the refresh
            and cascading of Supplier's Equipment associated with providing the
            Services throughout PacifiCare's operations in accordance with the
            Refresh Schedule. This shall include: planning, associated change
            management and problem management, de-installation, reinstallation,
            configuration, staging, and user orientation as otherwise specified
            hereunder.

            Supplier shall monitor and report on Equipment leases.

      5.    SOFTWARE SUPPORT:

            SUPPLIER'S SOLUTION DESCRIPTION:

            The Supplier team's Software support is initiated through the
      single-point-of-contact (SPOC) Help Desk.

            As necessary, the Supplier team [...***...] expertise and support iN
      order to resolve the Software problem, or the application management team
      for support of in-scope PacifiCare developed applications. [...***...].

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            The Supplier shall provide Software support, correct Software
      problems, provide support for PacifiCare Software, distributed computing
      productivity tool development, NOS support, and computing Software
      infrastructure support (e.g., shared resources, menu systems, etc.).
      Supplier's responsibilities for Software support include the following:

            [...***...]

            [...***...]

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       86.
<PAGE>
            Install Software for which Supplier is responsible according to the
            applicable specifications as well as PacifiCare standards.

            To the extent enabled by the PacifiCare-approved enterprise
            management system provided by Supplier, define and check for
            particular Software signatures, to monitor the use of Software
            developed by the applications development and maintenance group, and
            to check the presence and version of Software present on a
            particular device.

            Install upgrade, provide maintenance and support for in-scope
            Desktop related Software. Supplier shall also maintain a list of
            documentation that reflects the complexity and diversity of the
            environment and enhances the Software support process. Supplier
            shall maintain a library of Supplier-supplied and Supplier-developed
            documentation.

            Coordinate any testing, scheduling, or systems integration on the
            Supplier-controlled systems of PacifiCare Software, which have been
            unit tested but not integration tested. Supplier shall coordinate
            rollouts and upgrades and provide proper back-out procedures of
            Supplier-introduced third party Software as well as for Supplier
            upgrades and new releases of any internally developed applications.
            Supplier shall test PacifiCare Software products before
            implementation. Supplier, shall assist in testing the applications
            before rollout

            Recommend appropriate methods and tools to improve and increase
            automation in PacifiCare's distributed computing environments, and
            work with PacifiCare to research, evaluate and implement such tools
            and methods. Supplier shall utilize productivity tools, utilities,
            and create batch files.

            Perform the installation of a Software refresh for the PacifiCare
            standard Software suite (including operating systems, Virus
            protection Software and browser) for desktop and laptop systems as
            required by PacifiCare approved projects. [...***...].

            Maintain master copies of the PacifiCare standard Software suite in
            a secure, central location with back-up copies stored in a separate
            location.

            Support PacifiCare Software and provide technical assistance for
            developed applications.

            Support productivity tools/utilities/batch files in support of
            providing desktop services.

            Maintain compatibility between third party products and LAN NOS and
            test them.

            Coordinate and implement application rollouts and /or upgrades of
            PacifiCare Software. This includes: documentation of application
            roll-out in Change Management Procedures, coordination of proper
            testing for given environment, scheduling implementation times and
            on-site support after the release has been accomplished.

      6.    SOFTWARE CURRENCY, REFRESH, AND RELEASE CONTROL:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       87.
<PAGE>
            Supplier's responsibilities shall include installing, maintaining,
      upgrading and supporting in-scope distributed systems Software including
      firmware. Supplier shall interface with third party suppliers to promote
      compatibility of such distributed systems products. Supplier's
      responsibilities to provide Software currency Services shall include the
      following:

            Unless otherwise directed by PacifiCare, Supplier shall install,
            maintain and upgrade Software for which Supplier is otherwise
            responsible hereunder [...***...].

            Coordinate, test, install and support Systems and systems program
            products.

            Test operating Systems Software, coordinating with applications
            personnel and End-Users.

            In implementing changes, upgrades, or enhancements to the PacifiCare
            Software environment, Supplier shall observe the Change Control
            Procedures and shall perform installation planning, product
            installation, testing and verification. In addition, Supplier shall,
            for any Software changes, upgrades, or enhancements proposed to
            PacifiCare advise PacifiCare of any additional Equipment, LAN,
            environmental, etc. requirements observed during integration testing
            and/or otherwise known to be necessary for implementation of the
            changes, upgrades or enhancement. Supplier shall also:

            Demonstrate compliance with PacifiCare Corporate Information
            Technology Architecture and Technical Standards, if applicable.

            Demonstrate compliance with data security policies and standards as
            required hereunder.

            In the telecommunications environment for which Supplier is
            responsible, Supplier shall be responsible for network Software,
            including those Software products required for connectivity.
            Supplier shall interface with other PacifiCare suppliers to promote
            compatibility of connectivity products, and shall manage the
            subcontractors that provide Software support to network products for
            which Supplier is otherwise responsible hereunder. Unless otherwise
            directed by PacifiCare, Supplier shall manage its upgrades to be at
            the current level or one generation below the current level for each
            Software component for which Supplier is responsible, provided that
            such components that are at such level as of the Effective Date
            shall, at PacifiCare's option, be upgraded to that level of
            currency.

            Provide installation of department or End-User-specific Software as
            requested by PacifiCare. Supplier shall periodically (at least
            monthly) report to PacifiCare the installation of such Software.

            Supplier shall provide support, advice and assistance to End-Users
            for Software for which Supplier is responsible hereunder.

            [...***...]

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       88.
<PAGE>
            [...***...].

            To the extent enabled in the PacifiCare approved enterprise
            management system provided by Supplier, Supplier shall monitor use
            of licensed Software, including license metering and tracking.

      7.    OPERATIONS SUPPORT FOR NEW SERVICES:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            The Supplier shall interface between the groups implementing changes
      and the production support function, assuring compliance with standard
      documentation, necessary scheduling, and orderly turnover. Supplier's
      responsibilities for operations support for New Services shall include:

            Obtaining formal approvals of production testing and installation
            timetables.

            Develop comprehensive operational documentation.

            Facilitate orderly turnover for Desktop Equipment and applications
            to include developing fallback procedures.

            Support for the introduction of new Platforms and applications in
            accordance with the Change Control Procedures and in a controlled
            manner by, among other things: [...***...]

            Interface between the groups implementing changes and the production
            support function.

            Maintain documentation standards, task lists and run sheet updates.

            Inform affected operations staff of changes to the environment.

            Provide project management and technical expertise to optimize
            available resources.

            Provide coordination and acceptance of New Services.

      8.    SYSTEMS MANAGEMENT:

            SUPPLIER'S SOLUTION DESCRIPTION:

            [...***...]

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       89.
<PAGE>
      [...***...].

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            The Supplier shall develop tools and processes to allow automated
      and remote systems management of the distributed computing environment.
      Processes shall include Software distribution, backups, performance
      measurement, tuning, license and asset management, etc. The Supplier may
      adopt/adapt any of PacifiCare's existing management tools. The Supplier
      shall install Virus Software on PCs and maintain its currency. Supplier's
      responsibility for systems management Services shall include the
      following:

            Consistent with the Transition Plan and during the Term and during
            the Termination Assistance Period, evaluate (when requested)
            implement and maintain tools and processes for automated and remote
            systems management and restoration of client desktop computing
            machines. Such tools and processes shall include broadcast Software
            distribution, license management tools, performance measurement,
            tuning, backup/Business Continuity, and automatic alerting. During
            the Term and Termination Assistance Period, as applicable, Supplier
            shall implement tools with the goal of moving PacifiCare's
            environment from reactive to proactive monitoring and management
            tools to enhance the stability and function of the environment.

            Install, update, operate and maintain Virus protection Software.

            Provide tuning to improve performance and utilization.

      9.    TECHNOLOGY (EQUIPMENT) REFRESH:

            SUPPLIER'S SOLUTION DESCRIPTION:

            Supplier shall provide technology (Equipment) refresh per the
      Refresh Schedule.

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            The Supplier shall refresh the desktop environment according to the
      Refresh Schedule.

            The Supplier shall cascade new desktop technology and services to
      meet PacifiCare's business requirements as required, requested and
      approved by PacifiCare. Supplier shall perform such technology refresh
      functions in accordance with the following:

            Upgrade, maintain, and support in-scope desktop computers,
            Peripherals, and LAN based Equipment.

            Coordinate comprehensive technology refresh.

            Deploy new desktop Equipment and services to meet business
            requirements.

            Analyze emerging desktop Equipment.

      10.   STANDARD EQUIPMENT AND SOFTWARE:

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       90.
<PAGE>
            SUPPLIER'S SOLUTION DESCRIPTION:

            As a transition activity, Supplier shall work with PacifiCare to
      define and deploy PacifiCare standard images. These images shall be
      maintained by Supplier using a pool of dedicated resources to manage their
      currency and validity. Changes to the defined images shall be addressed
      through the Change Management Procedures and shall be processed as
      follows:

            [...***...].

            [...***...]. Exceptions must be jointly approved.

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall work with PacifiCare to design standard Equipment and
      Software configurations for the PCs, and assume responsibility for
      collecting necessary input from PacifiCare departments. The basis of such
      standardization shall be the PacifiCare standard office environment. The
      PacifiCare standard in effect as of the Effective Date and may be modified
      and amended as approved or requested by PacifiCare and there may be more
      than one standard in effect at the same time. Once approved by PacifiCare,
      Supplier shall document, implement and communicate the standard throughout
      the supported environment. The implementation plan shall include the
      necessary Supplier and PacifiCare testing and systems integration with
      applications in the current environment. Supplier shall perform such
      standard Equipment and Software functions in accordance with the
      following:

            Identify areas of non-compliance.

            Evaluate new and emerging standards and business requirements.

11.   LAB TESTING:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            The Supplier shall be responsible for thorough testing of
      Supplier-installed new versions of Equipment and Software prior to
      recommending the implementation of these products. This includes the
      construction and maintenance of laboratory systems that simulate
      PacifiCare's production environment. Supplier shall provide results of
      testing upon request. Supplier shall perform such laboratory testing
      functions in accordance with the following:

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       91.
<PAGE>
            Provide laboratory environments that simulate PacifiCare's
            production environment.

            Provide unit testing, systems integration testing, LAN/WAN
            connectivity testing, load testing and application interconnectivity
            testing on Supplier-installed new versions of Equipment and
            Software.

            Provide a test plan for Supplier-installed Equipment.

12.   SPARES INVENTORY:

            SUPPLIER'S SOLUTION DESCRIPTION:

            Supplier shall populate its inventory database with PacifiCare's
      current Equipment and Software inventory. Supplier shall update and verify
      this inventory via calls to the Help Desk (information about the end
      user's workstation shall be verified), auto discovery, and the IMAC
      process. [...***...].

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier's responsibilities include maintaining an inventory of
      spare parts for in-scope Equipment (including associated Peripherals) for
      which Supplier is otherwise responsible to maintain hereunder in a
      quantity that is sufficient to provide replacement Equipment and
      associated Peripherals as required and provide periodic reports on same.
      PacifiCare is responsible for providing a sufficient number of Laptop PCs
      to be used in support of the "mail in" repair of Laptop PCs when the
      End-User requires an interim Laptop PC while their Laptop PC is being
      repaired.

F.    CUSTOMER SUPPORT DEPARTMENT (HELP DESK)

1.    Help Desk Support:

            SUPPLIER'S SOLUTION DESCRIPTION:

            As of the Cutover Date and the expiration or early termination of
      the current Managed Agreement, Supplier shall provide Customer Support
      Department Services in accordance to Schedule 13.3, Policy and Procedures
      Manual and as defined below. The Policy and Procedures Manual shall
      describe level 1, level 2 and level 3 Help desk.

            The Help Desk solution for PacifiCare results in a
      single-point-of-contact (SPOC) for End-User Service Requests relating to
      in-scope Services. [...***...]. Supplier shall implement this solution by

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       92.
<PAGE>
      leveraging the experience and proficiency of PacifiCare's current
      processes and procedures combined with Supplier's experience; and by
      implementing an integrated Service Request management tool, and
      introducing greater efficiencies through Web-enablement and automation.

            Furthermore, the Help Desk shall enhance end user satisfaction and
      realize significant efficiencies [...***...] to receive, close, and update
      tickets.

            [...***...]. Supplier shall validate use of the system by
      implementing PacifiCare approved end user authentication procedures.

            HELP DESK ARCHITECTURE

            Supplier shall utilize Supplier's shared network infrastructure
      (SNI) to be used to connect the SPOC and Service Delivery Center
      infrastructure to PacifiCare's network.

            SHARED NETWORK INFRASTRUCTURE

            In order to provide global capabilities in support of commercial
      customers, Supplier has designed a network infrastructure that securely
      links individual customer networks to Supplier's delivery centers.

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall be responsible for management and resolution of
      Service Requests to the extent they involve Services.

            Supplier shall be responsible to provide reactive and proactive Help
            Desk support. The Help Desk shall be located in a Supplier Data
            Center or other Supplier location. This multi-disciplinary Help Desk
            function shall, upon completion of the Transition Plan, provide both
            reactive and proactive Service Request determination, resolution
            and /or tracking, as applicable, with respect to applications
            functions or Equipment within Supplier's scope of responsibility.

            The Service Request management process implemented by Supplier shall
            be flexible and shall facilitate effective coordination/
            communication across Service Request management groups, Service
            Locations, regions and other Suppliers providing service to
            PacifiCare. Supplier shall be responsible for maintaining Service
            Request ownership throughout the resolution process with regular and
            timely progress updates communicated back to the End-User in an
            effective manner. Ownership of the Service Request should revolve
            around the client's needs and to minimize handoffs.

            Provide improved control and tracking of IS service requests,
            including consolidation of IT service requests and streamlined and
            automated process methodologies to reduce labor and administrative
            costs. In respect of the Equipment, Software and functions for which

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       93.
<PAGE>
            Supplier is otherwise responsible hereunder, Supplier's
            responsibilities shall include the following:

            Establish a virtual single point of contact (SPOC), including one
            telephone number, email account, and Intranet access for the
            End-User to report a Service Request or for questions relating to
            Help Desk Services. The Help Desk shall provide assistance for
            End-User Service Requests acting as the initial point-of-contact and
            coordinating Service Request tickets. [...***...]

            As described in detail elsewhere in this Statement of Work, Supplier
            shall implement acceptable policies and procedures for proactive
            monitoring, escalation, review and reporting (historical and
            predictive) of all Service Requests. [...***...] If existing
            procedures need to be refined, or in the case where none exist, the
            Supplier shall develop and PacifiCare shall approve the procedures.
            Until such procedures are established and agreed to (using the
            format set forth in Policy and Procedures Manual, Schedule 13.3),
            Supplier shall follow PacifiCare's policies and procedures
            [...***...] in effect as of the Effective Date.

            Supplier's approach to this responsibility shall reflect a client
            service focus. [...***...] Supplier shall align resources and skilL
            sets with business unit requirements by balancing continuity of
            staffing with assignment rotation.

            The Help Desk Services described in this Agreement shall be provided
            24 hours per day, seven days per week through a toll-free
            Supplier-provided telephone number. [...***...] Provide appropriatE
            second level Service Request resolution and support to End-User
            Service Locations.

            Provide on-site field service to Service Locations as required
            during normal business hours, End User local time, and during other
            hours through on-call availability of field service personnel.
            [...***...]. Upon identification of a Service Request requiring
            on-site field service, Supplier personnel shall follow the notice
            and verification procedures set forth in Schedule 13.3 Policy and
            Procedures Manual, Schedule 13.3 and as otherwise required to meet
            the Service Levels. [...***...]

            [...***...]

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       94.
<PAGE>
            [...***...]

            As of the Effective Date, Supplier has such a tool installed and in
            use and provides similar support to its other customers. In an
            appropriate and timely manner, communicate pertinent information
            regarding Service Requests and associated progress and communicate
            such information to affected End Users on a proactive and timely
            basis. Implement processes to record and track Service Requests
            reported directly to on-site personnel in high service areas.

            Provide PacifiCare and its designees access to [...***...]

            Provide appropriate Supplier [...***...]training for PacifiCare's
            Information Services staff, as needed.

            Log reported Service Requests upon receipt from End-User or
            automated alarm and monitor, control and report on each Service
            Request until it is resolved and PacifiCare confirms such resolution
            and completeness. Implement methodologies to prevent recurrence of
            problems. Perform problem root cause analysis, identify preventive
            measures, and make recommendations to fix root causes.

            With respect to calls that relate to functions within Supplier's
            scope of responsibility, [...***...]

            With respect to calls that do not relate to functions within
            Supplier's scope of responsibility, [...***...]

            In all cases, Supplier shall provide initial Service Request
            determination and tracking, even with respect to calls that do not
            relate to functions within Supplier's scope of responsibility. In
            such instances, Supplier shall cooperate with other internal or
            external parties to resolve the Service Request.

            Support End-Users by providing a timely and clear indication of the
            nature of the Service Request, the estimated time to completion, and
            potential short-term alternatives.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       95.
<PAGE>
            Subject to PacifiCare's review and approval, develop and
            periodically update Service Request escalation procedures and
            distribute such procedures to End-Users.

            [...***...]

            Develop and maintain common Service Requests and resolutions guide.

                  [...***...]

            Strive toward the automation of processes to facilitate Service
            Request management with third parties.

            Implement a process for tracking and reporting Help Desk activity,
            including, at a minimum, [...***...]. In this regard, Supplier shalL
            perform the following functions:

            [...***...]. Reports shall be calculated in accordance with requireD
            Service Levels and stated in Schedule 3.8(b).

            [...***...]

            Supplier's Help Desk personnel shall possess appropriate Service
            Request management capabilities and qualifications to support the
            Help Desk functions. Supplier shall provide the Help Desk personnel
            with adequate training on new products and services as may become
            part of Supplier's responsibilities from time to time.

            For failures reported to the Help Desk or known to Supplier that
            affect provision of the Services, Supplier shall comply with the
            notification procedures and contacts set forth in Policy and
            Procedures Manual, Schedule 13.3.

            Develop and document processes regarding interfaces and interaction
            between second-level support groups and the Help Desk.

            Proactively identify potential Service Requests and take appropriate
            action to report occurrence of Service Requests so identified.

            Measure Help Desk performance and report the results to PacifiCare
            in accordance with Schedule 3.8(b).

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       96.
<PAGE>
            Conduct random surveys of End-Users immediately after using the Help
            Desk services and report the results to PacifiCare.

            Provision of Help Desk support in English.

            Coordinate tours of the Help Desk with PacifiCare for PacifiCare's
            End-Users, provided that such tours shall be (i) reasonable in
            frequency; and (ii) subject to reasonable prior notice.

            2.    Problem Management:

                  Escalate unresolved Service Requests according to established
            procedures and automatically prioritize high-impact systems and
            Equipment such that, when outages occur, they are treated with the
            highest priority. For all classes of Service Requests that are or
            become problems, such escalation procedure must reflect (1) the
            severity of the problem and (2) the complexity of the environment.
            The escalation procedure shall describe [...***...]. If existing
            procedures need to be refined, or in the case where none exist, the
            Supplier shall develop and PacifiCare shall approve the procedures.
            Until such procedures are established and agreed to (using the
            format set forth in Policy and Procedures Manual, Schedule 13.3),
            Supplier shall follow PacifiCare's definition of Severity Levels and
            Problem Management escalation procedures in effect as of the
            Effective Date.

            Provide a mechanism for expedited handling and immediate
            notification to PacifiCare of system outages on critical systems
            that are of high business priority to PacifiCare, and provide
            progress updates as set forth in Policy and Procedures Manual,
            Schedule 13.3. Provide appropriately trained systems personnel for
            outage resolution and provide appropriate personnel back-ups.

            Correct problems within the scope of Supplier's responsibility.
            Correction may include modification or restoration of a file,
            procedure, or program. Corrections shall be subject to verification
            by the PacifiCare affected End-User or control person.

            [...***...]

            Provide troubleshooting and 1st/2nd level Service Request resolution
            for system and network devices including bridges, file servers,
            communications servers, mail servers, workstation interface boards,
            cabling, and telecommunications.

            Provide temporary on-site support to resolve repetitive problems of
            an extended nature that cannot be resolved remotely.

            Conduct, at PacifiCare's request, meetings to address Supplier's
            Problem Management and resolution activities in the event that there
            is a recurrent problem.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       97.
<PAGE>
            Provide reports on problems including statistics on total number of
            problems, outstanding problems and resolution time. Investigate,
            verify, record and report Equipment and system non-performance or
            downtime, and Software errors.

            Coordinate reported problems between third party telecommunications
            providers and internal PacifiCare teams to resolve issues escalated
            by the Help Desk. This may include coordination of on-site meetings
            between appropriate third-party Suppliers.

G.    INFORMATION DISTRIBUTION CENTER

            Supplier shall [...***...] in Supplier's operation of the IDC.

      1.    PRINT AND MEDIA OPERATIONS:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall assume responsibility for high-speed production
      print, media (fiche, diskettes, microfilm, CD ROM), and encounter
      operations services as they exist as of the Cutover Date, during the Term
      and over the Termination Assistance Period. Supplier's responsibilities
      shall include:

            Assist PacifiCare in providing secure environment in accordance with
            Schedule 10.2. Provide assistance in the testing of UPS and building
            generator(s) for power availability during power outages.

            Maintain job procedures for PacifiCare's IDC and Disaster Recovery
            locations in accordance with Managed Agreements.

            [...***...].

            For print/disk duplicating/CD burning and storage, tape mounting,
            microfilm indexing, media processing and backup generator Equipment:

            Coordinate with external third party providers.

            Identify and manage third-party supplier relationships to correct
            problems with Equipment

            Schedule preventive maintenance on Equipment based on reviews,
            analysis of Equipment performance records, and original equipment
            manufacturer recommendations .

            For IDC print/disk duplicating/CD burning and storage:

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       98.
<PAGE>
            Support, maintain, coordinate and deliver output (print/disk
            duplicating/CD burning) activities. Current environment includes:
            [...***...] check printing.

            Provide 7 x 24 print operation to meet business needs.

            Deliver output per production schedule.

            Operate output devices, including high speed color, black/white,
            MICR printers with laser cut sheet printed output, impact printers,
            CD burners and disk duplicating.

            Manage print/disk duplicating/CD burning queues.

            Perform QC of output.

            Maintain audit logs/chain of custody recording.

            Prepare printed output (e.g. checks, reports, ID cards, letters, and
            other documents: EOBs, EOPs) for distribution and distribute them.

            Prepare diskettes and CDs for distribution and distribute them.

            Perform weekly backups of fileshares to CD-ROM.

            Develop, maintain and store via Change Management Procedures print
            output forms libraries and required printer fonts.

            Identify and correct problems with forms, fonts, fileshare output.

            Maintain, order and store print, CD, diskette inventories and
            supplies

            Proactively monitor and maintain appropriate level of production
            support materials (e.g. paper, forms, toner, etc.) and office
            supplies needed to accomplish job duties.

            Design and store laser print and standard output forms.

            Provide testing for new or changed applications and stock (e.g.
            check or ID card stock) t for compatibility with standards and
            technical environment.

            For Microfilm/Microfiche services:

            Support, maintain, coordinate and deliver microfilm and microfiche
            activities.

            Coordinate and interface with users and outside providers, as
            needed, to support the production of microfiche and microfilm.

            [...***...]

            [...***...]

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       99.
<PAGE>
            Receive and send boxes of paper to vendor for filming , and manage
            document destruction certificates.

            Identify problems with microfilm application to technical support.

            [...***...]

            Receive and log CD, diskettes, tapes and paper.

            Load and validate encounter data media for Data Center processing.

            Return media with reports to source.

            [...***...]

                  Load and/or schedule incoming enrollment data from diskette,
            CD or tape media to production server location for access during
            nightly batch Data Center processing.

            [...***...]

            Coordinate and interface with the Managed Agreements suppliers to
            support DR plan and readiness to meet recovery time objectives.

            Prepare for, and participate in [...***...]

            [...***...]

            Participate with DR plan coordinator [...***...] to maintain Print
            Operations DR Plan.

            Create and maintain Media Operations and encounters processing DR
            Plan.

            Proactively maintain sufficient capacity to meet business needs and
            changes in business model per the Change Management Procedures.
            [...***...]

            Consult on related Equipment and technology investments across
            PacifiCare.

            [...***...]

            Provide (combined with Finishing and Account Management) functional
            subject matter expertise on business applications for which output
            is provided. [...***...]

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                      100.
<PAGE>
            Gather, maintain and report key metrics.

            Manage in-scope projects to support the business output needs or
            improve the environment.

      2.    FINISHING OPERATIONS:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall assume responsibility for finishing (manual and
       automated, production, scheduled-ad-hoc and ad-hoc) services as they
       exist as of the Cutover Date during the Term and during the Termination
       Assistance Period. Supplier's responsibilities shall include:

            Assist PacifiCare in providing secure environment in accordance with
            Schedule 10.2. Provide assistance in the testing of UPS and building
            generator(s) for power availability during power outages.

            Maintain job procedures for 'PacifiCare's IDC and Disaster Recovery
            locations in accordance with Disaster Recovery Managed Agreement.

            [...***...].

            Support, maintain, coordinate and deliver activities and Equipment
            to support manual assembly and automated inserting/mailing for
            production, scheduled ad-hoc and ad-hoc work.

            Maintain audit logs/chain of custody recording.

            For finishing Equipment (includes automated mailing/inserters,
            tabletop printers, envelope labelers, folders, etc.):

            Coordinate with Managed Agreement suppliers.

            Identify problems with automated mailing/inserter Equipment Software
            interface application to technical support.

            Manage responsibility through appropriate vendors for Equipment and
            associated Software repairs.

            Schedule preventive maintenance on finishing Equipment based on
            reviews, analysis of Equipment performance records, and original
            equipment manufacturer recommendations.

            Provide traceable communication method and time frames to interface
            with customer to process manual or automated exceptions (custom
            groups, pulls, special handling).

            Quality Control input and output:

            Verify print quality and completeness of information.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                      101.
<PAGE>
            Identify missing information, investigate and re-order print or
            other.

            Route output (e.g. for manual assembly, automated mailing and/or
            distribution).

            Provide for testing new or changed applications, stock and
            procedures for compatibility with standards and technical
            environment.

            For manual assembly and processing:

            For production output [...***...]

            Coordinate, collate, insert, verify materials against reports, sort,
            audit, cross-check; identify discrepancies; request required
            assistance from customer and/or IDC source of input.

            Create fulfillment packets.

            Prepare output (e.g. tray/bucket envelopes) for distribution and
            route

            For automated mailing - production, scheduled ad-hoc and ad-hoc
            output:

            [...***...]

            Manage work queues.

            Perform QC of output from Equipment (e.g. address readable in
            window, insert folded properly, postmark readable, sheet(s)
            insertion correct etc.)

            Prepare output (e.g. tray envelopes) for distribution and route.

            Develop, maintain and store [...***...] following Change Management
            Procedures.

            Accurate and timely processing and mailing per Service Levels or
            individual commitment.

            Research and track " customer inquiry requests" related to
            production jobs.

            Proactively monitor, order, maintain/store appropriate level of
            production support materials and office supplies, on the production
            floor and readily accessible, needed to accomplish job duties.

            Maintain time and materials for daily billing data for each job.

            Identify and implement Equipment solutions to improve cost,
            productivity and quality per the Change Management Procedures.

            Manage output (e.g. feed paper, collate and/or distribute output)
            from physically co-located, but customer owned printers; report
            technical problems to customer.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                      102.
<PAGE>
            [...***...]

            Coordinate and interface with the Disaster Recovery Managed
            Agreement to support DR plan and readiness to meet recovery time
            objectives.

            Prepare for, and participate in, a minimum of 2 tests at Hot
            Site/year.

            Maintain synchronization of DR site in accordance with IDC Change
            Management Procedures.

            [...***...]

            Proactively maintain sufficient capacity and staffing to meet
            production, scheduled [ad-hoc] and [ad-hoc] business needs and
            changes in business model per the Change Management Procedures.
            [...***...]

            Consult on related Equipment and technology investments across
            PacifiCare.

            Provide subject matter expertise to PacifiCare re: assembly and
            automated mailing.

            Provide (combined with Print Operations and Account Management)
            functional subject matter expertise on business applications for
            which output and finishing is provided. [...***...]

            Gather, maintain and report key metrics.

            Manage in-scope projects to support the business output needs or
            improve the environment.

      3.    ACCOUNT MANAGEMENT:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall assume responsibility for account management services
      as they exist as of the Cutover Date during the Term and over the
      Termination Assistance Period. Supplier's responsibilities shall include:

            Interface with customers regarding billing, validate cost centers
            for billing.

            Interface with IDC End-Users to:

            Write customer agreements, and production / scheduled ad-hoc
            procedures.

            Gain PacifiCare approval per Schedule 13.3, Policy and Procedures
            Manual of customer agreements and procedures.

            Update and maintain customer agreements and procedures.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                       103.
<PAGE>
            Coordinate IDC in-scope business projects; manage projects to
            support the business output needs or improve the environment.

            Coordinate and monitor start up or changes to production activities,
            including materials.

                  Participate in testing, implementation and post-implementation
            review for new and major revisions production and schedule ad-hoc
            jobs.

            Coordinate in-scope projects with IDC production schedule.

            Create and publish IDC production print and finishing schedule.

            Perform as primary customer "front end" liaison for each
            region/application.

            Provide (combined with Print Operations and Finishing) key
            application focus and subject matter expertise for business
            applications for which output is provided. (Currently Account
            Management is SME for system's ID cards and correspondence -
            [...***...]

            Coordinate and communicate with third party suppliers, PacifiCare
            and business users regarding the design, inventory re-order points,
            approvals, testing (Membership Accounting, Marketing, Member
            Services, Legal/Regulatory) and purchasing of ID card inventory.

            Prepare ID card cycle time reports

            Perform audits of IDC procedures

      4.    DEMAND PRINT:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall assume responsibility for demand print (scheduled
      ad-hoc and ad-hoc) services as they exist as of the Cutover Date during
      the Term and over the Termination Assistance Period. Supplier's
      responsibilities shall include:

            [...***...].

            Support, maintain, coordinate and deliver activities and Equipment
            to support production, scheduled ad-hoc and ad-hoc demand print
            services.

            Coordinate jobs to be reproduced with PacifiCare customers.

            Data correct and merge letters.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                      104.
<PAGE>
            Provide demand print accounting and monthly reporting for chargeback
            by PacifiCare

            Prepare artwork for Business Reply Mail (BRM) envelopes and
            interface with U.S. Postal Service on PacifiCare's behalf for
            approval..

            For ad-hoc, provide customer interface and job monitoring for ad-hoc
            mailing jobs from order, materials and job setup, file merges,
            through delivery and QC.

            Operate demand print related Equipment. [...***...]

            For demand print Equipment:

            Coordinate with third party suppliers, as appropriate.

            Identify and correct problems with production Equipment.

            Schedule preventive maintenance with appropriate third party
            suppliers as required on Equipment based on reviews, analysis of
            Equipment performance records, and original equipment manufacturer
            recommendations.

            Provide reprographics/demand printing for:

            Digital, black and white, and color,

            Electronic receipt of files across network,

            Electronic offline storage and edit/reformat before print,

            Company standard note pads,

            Mylar or paper tabs for notebooks or reports.

            Provide full service bindery for:

            Machine folding (e.g. letters and brochures).

            Labeling (e.g. envelopes and flyers).

            Notebook collation, tab placement and assembly.

            Comb (plastic) binding of printed documents.

            Heat/cloth binding of reports and documents.

            Machine collating and saddle-stitching (e.g. pamphlets, booklets,
            brochures).

            Drilling, cutting and shrink wrapping.

            Coordinate and interface with third party suppliers to provide
            offset printing.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                      105.
<PAGE>
            Record necessary information in time accounting work flow system for
            daily billing data for each job and monthly reporting for chargeback
            by PacifiCare.

            For Demand Print Disaster Recovery (DR):

            Coordinate and interface with third party suppliers to support DR
            plan and readiness to meet recovery time objectives.

            Prepare for, and participate in, a minimum of 1 test per year.

            [...***...]

            Proactively monitor and maintain appropriate level of production
            support materials and office supplies needed to accomplish job
            duties.

            Consult on related Equipment and technology investments across
            PacifiCare.

            Provide subject matter expertise to PacifiCare re: demand print and
            mailing functions.

            Gather, maintain and report key metrics.

            Maintain sufficient capacity and staffing to meet business needs per
            the Change Management Procedures.

            Manage in-scope projects to support the business output needs or
            improve the environment.

      5.    MAIL PROCESSING

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall assume responsibility for mail processing/
            distribution services [...***...] as they exist as of the Cutover
            Date, during the Term and over the Termination Assistance Period.
            Supplier's responsibilities shall include:

            Assist PacifiCare in providing secure environment in accordance with
            Schedule 10.2., Provide assistance in the testing of UPS and
            building generator(s) for power availability during power outages.

            Maintain job procedures for 'PacifiCare's IDC and Disaster Recovery
            locations in accordance with Disaster Recovery Managed Agreements.

            [...***...].

            Provide mail stop coordination and administration for the
            enterprise.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                      106.
<PAGE>
            Support, maintain, coordinate and deliver activities and Equipment
            to service mail and distribution needs [...***...]

            For mail processing Equipment and delivery vehicles:

            Coordinate with third party maintenance suppliers and third party
            suppliers.

            Identify and correct problems with Equipment/vehicles

            Schedule preventive maintenance on Equipment/vehicles based on
            reviews, analysis of Equipment performance records, and original
            Equipment manufacturer recommendations.

                  Operate mail/distribution Equipment and delivery vehicles,
                  including: manifest system, mail metering Equipment,
                  accountable mail system, mail management system, scale,
                  carrier van and step van. Maintain audit logs/chain of custody
                  recording.

            Package for shipping and/or deliver reports.

            Sort and manage special internal distributions.

            Obtain mail from Post Office.

            Receive courier/pouches, overnight/[...***...] mail and parcels.

            Maintain accountable mail manifests (overnights, airline tickets,
            certifieds, checks).

            Sort mail and deliver mail per Policy and Procedures Manual.

            Deliver accountable mail with tracking.

            Perform mystery (mis-addressed) mail lookup and coding.

            Monitor, track and report returned mail.

            Process outbound pouch, [...***...]for the Campuses.

            Manage postage accounts for the enterprise.

            Manage postage meters for IDC functions (Finishing and Mail
            Processing meters).

            Validate with PacifiCare the mail screening policy on a regular
            basis, at minimum annually and respond accordingly. Additional
            activity relating to mail screening may be considered a New Service.

            [...***...] based PO Box and Business Reply accounts per Managed
            Agreements.

            For Mail Processing Disaster Recovery (DR):

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                      107.
<PAGE>
            Coordinate and interface with PacifiCare facilities to support DR
            plan and readiness to meet recovery time objectives

            Prepare for, and participate in, [...***...] at alternate location.

            Maintain synchronization and currency of Equipment designated for DR
            and supporting materials, and keep track, in accordance with IDC
            Change Management Procedures and/or Change Control Procedures.

            Participate with DR Plan coordinator (currently IDC Account
            Management function) to maintain Mail Processing DR Plan.

            Provide subject matter expertise to PacifiCare re: optimal mail and
            distribution practices.

            Gather, maintain and report key metrics.

            Maintain sufficient capacity and staffing to meet business needs per
            the Change Management Procedures.

            Manage in-scope projects to support the business output needs or
            improve the environment.

      6.    ADMIN SUPPORT SERVICES

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall assume responsibility for administrative, chargeback,
      warehouse, inventory management, materials ordering ([...***...])
      processes, to include:

            Coordinate financial/admin tasks and processes in support of the IDC
            operation, including:

            Complete chargeback tasks [...***...] and reporting per schedule
            fRoM PacifiCare IS Finance.

            Prepare and distribute custom postage reports, contra summary report
            preliminary and final, as well as preparation of business
            graphs/statistics/metrics for monthly book.

            [...***...]

            Coordinate inventory management and warehouse tasks and processes in
            support of the IDC production and ad-hoc finished goods output.

            Operate systems, and warehouse Equipment with certified operators.

            For warehouse Equipment and systems:

            Coordinate with third party suppliers.

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                      108.
<PAGE>
            Identify and correct problems with Equipment.

            Schedule preventive maintenance per on Equipment based on reviews,
            analysis of Equipment performance records, and original equipment
            manufacturer recommendations.

            Maintain and effectively manage inventory per Change Control
            Procedures and/or Change Management Procedures as applicable.

            Receive and input materials shipments into inventory management
            system, perform physical inventories and cycle counts

            Monitor climate controlled ([...***...]) warehouse for select
            inventory to meet production needs available [...***...].

            Pull, pick, deliver and/or pack orders for distribution.

            Provide PacifiCare access to current inventory information.

            Provide notification of low stock to customers.

            Maintain sufficient IDC supplies inventory.

            Coordinate and interface with third party suppliers to provide and
            receive materials.

            Gather, maintain and report key metrics.

      7.    CUSTOMER SERVICE:

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall assume responsibility for customer service as they
      exist as of the Cutover Date, during the Term and over the Termination
      Assistance Period. Supplier's responsibilities shall include:

            Answer and service incoming customer service calls for IDC.

            Set up same day courier services (per request).

            Provide IDC [...***...].

                  Gather, maintain and report key metrics.

                  [...***...]

      8.    STRATEGIC INITIATIVES AND SUPPORT:

                                            * CONFIDENTIAL TREATMENT REQUESTED

                                      109.
<PAGE>
         PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall assume responsibility for technical project
         management, and technical project delivery, enhancements, integration
         and support services for IDC solutions as they exist as of the Cutover
         Date in the IDC, during the Term and over the Termination Assistance
         Period. Supplier's responsibilities shall include:

                  Act as the technical resource and subject matter expert
                  representing the IDC for any IS Development or Methodology
                  projects/enhancements/ maintenance.

                  Provide technical support for the IDC applications (not
                  systems or network operating systems) production environment
                  in PacifiCare and at DR Hot Site.

                  Receive and resolve production issues related to:

                           Reports on fileshares.

                                    Electronic distribution of reports

                                    Automated change of address processing

                           Equipment or Software in any of the IDC functional
                           areas.

                  Schedule, communicate and perform upgrades to existing
                  systems.

                  Troubleshoot problems associated with changes or upgrades.

                  Document policies and procedures.

                  Provide input/feedback to PacifiCare management on existing
                  procedures.

                  Participate in the development of enterprise standards and
                  procedures for output.

                  Monitor Software application and production Equipment, and
                  notify PacifiCare of new capacity requirements.

                  Coordinate and interface with third party suppliers to support
                  Software and solutions.

                  Initiate, drive, manage and deliver solutions via all phases
                  of the development life cycle for any output related strategic
                  initiative projects ([...***...]) or projects to improve the
                  environment.

                  Work with PacifiCare Architecture Review Board to define
                  technical architecture for IDC print and finishing
                  environments.

                  Consult with IS functions and customers regarding
                  centralization and automation of output processes,
                  optimizations, and efficiency opportunities.

                  Provide subject matter expertise to PacifiCare re: output
                  architectures and standards.

                  Maintain IDC Change Management Procedures.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      110.
<PAGE>
                  Gather, maintain and report key metrics.

H.       CROSS FUNCTIONAL SERVICES:

                  The Services described in this portion of the Statement of
         Work apply to all of the Towers. Supplier shall contribute to general
         IT effectiveness in addition to the specific areas listed above. Such
         services include:

                  1.       CHANGE MANAGEMENT:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  The Supplier Program Office shall control changes to the IT
         environment through the Change Management Procedures, which shall
         include complete PacifiCare involvement. The process to be used is
         documented in Schedule 13.3 Policy and Procedures Manual, and an
         overview of the process is described in Exhibit 1 hereto.

                  The Supplier Program Office shall coordinate all change
         activities regardless of the Service delivery area or company
         responsible for delivering the service.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall perform change management functions in
         accordance with the agreed-upon Change Management Procedures to control
         and manage changes in the operation of the Services, including any such
         changes requested by PacifiCare. [...***...]. Supplier shall employ
         standard procedures for change coordination, review and reporting that
         are designed to minimize the business impact and risk to PacifiCare of
         any change activity, as described in Exhibit 1 hereto.

                  The Supplier shall provide an effective Change Management
         Procedure that shall facilitate effective coordination, communication
         and approval across groups, Service Locations and regions. Clear
         ownership for individual changes must be maintained throughout the
         process, with regular and appropriate progress updates (status reports)
         communicated back to those affected. Supplier's responsibilities to
         provide change management shall include the following:

                  Control changes to Services and PacifiCare's environment,
                  implement changes only in accordance with the standard
                  agreed-upon Change Management Procedures.

                  Review, schedule, communicate and obtain approvals on all
                  proposed Services changes with PacifiCare and all related
                  third parties to minimize disruption of normal business
                  process. Supplier must provide an impact assessment, back-out
                  plan (with specific criteria associated to executing the
                  back-out plan identified), end-to-end test plan where
                  appropriate, and clear change acceptance criteria identified.

                  [...***...], conduct change management meetings with
                  PacifiCare or its designee's participation.

                  [...***...]. This data shall be summarized and reported to
                  PacifiCare [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      111.
<PAGE>
                  [...***...] Provide an audit trail of any and all changes to
                  the production environment made according to the Change
                  Management Procedures.

                  Test changes to the environment and resolve problems prior to
                  production implementation, including inter-operability
                  testing. The results of the testing effort must be approved by
                  the appropriate PacifiCare personnel.

                  Schedule outages for system maintenance, expansions and
                  modifications during hours that meet PacifiCare's operational
                  needs and minimize disruption.

                  Supplier shall, in accordance with Schedule 4.1, Transition
                  Plan, and to the extent enabled in the PacifiCare approved and
                  Supplier provided enterprise management system, [...***...]

                  Include representatives at Service Locations designated by
                  PacifiCare as part of the change review, approval, scheduling,
                  communication and approval process. To facilitate
                  communications, Supplier shall (1) submit proposed changes for
                  review regularly in advance to PacifiCare and the End-Users
                  ([...***...]), and (2) provide a schedule of implementation
                  dates to PacifiCare for determination of any existing conflict
                  with business events. At a minimum, each change request shall
                  includE A description of the change, purpose and
                  justification, risk analysis, schedule, implementation
                  procedure, back-out procedure, and test plan.

                  Coordinate all changes to the Services with affected third
                  parties. The Change Management Procedures shall involve
                  applicable PacifiCare retained organizations and Application
                  Suppliers, and change management tools shall be made available
                  to them.

                  Define clearly the roles and responsibilities of all
                  individuals and areas involved in the change process, as well
                  as formalize the communication process between all affected
                  parties.

                  Avoid any change that (i) adversely affects the function or
                  performance of, or decreases to any significant degree the
                  resource efficiency of, the Services, (ii) increases
                  PacifiCare's costs or fees, or (iii) impacts the way in which
                  PacifiCare conducts its business or operations, without first
                  obtaining PacifiCare approval. Supplier may make temporary
                  changes required by an emergency if it has been unable to
                  contact PacifiCare to obtain such approval after making
                  reasonable attempts. Supplier shall document and promptly
                  report such emergency changes to PacifiCare. For the purposes
                  of this section, "emergency" means an event that would result
                  in financial impact to PacifiCare, an event that shall impact
                  the delivery of Critical Service Levels in real time, or any
                  event where PacifiCare's assets are at risk, e.g. data loss or
                  corruption

                  Implement a standard Change Management Procedure (as approved
                  by PacifiCare) that achieves a set of clearly defined goals,
                  including: efficient implementation of changes, minimize risk
                  and business systems.

                  Integrate changes across in-scope Platforms and Service
                  Locations.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      112.
<PAGE>
                  Develop a comprehensive contingency plan for each change that
                  presents a potentially high risk or high impact to
                  PacifiCare's operations or business, including: [...***...].

                  Perform routine maintenance during regular periods scheduled
                  in advance and approved by PacifiCare. At PacifiCare's request
                  and upon reasonable notice, Supplier shall change scheduled
                  maintenance windows. [...***...]. In the event that there iS a
                  need for emergency systems maintenance, Supplier shall provide
                  PacifiCare with as much notice as reasonably practicable, and
                  shall perform such maintenance so as to minimize interference
                  with the business and operational needs of PacifiCare. Systems
                  shall be unavailable during maintenance windows only to the
                  extent necessary for systems maintenance purposes.

                  Control system changes and activities required by moves,
                  upgrades, replacements, migrations, etc.

                  Report status of scheduled changes including maintaining a
                  comprehensive list of changes or activities and dates.

                  2.       QUALITY ASSURANCE:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  SERVICE LEVEL REQUIREMENTS

                  Supplier provides reporting on Supplier's attainment of
                  Service Level requirements (refer to Schedule 8) on a regular
                  and scheduled basis.

                  ANNUAL THIRD PARTY SURVEY

                  -        The Annual Survey shall be conducted as stated in the
                           Agreement.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall employ a quality assurance program designed to
         promote performance of the Services at a level consistent with the
         highest professional standards of care. Supplier shall write and
         maintain procedures on all quality assurance activities. Supplier shall
         provide an environment for PacifiCare to execute audits of quality.
         Supplier shall in consultation with PacifiCare, [...***...]. Supplier
         shall take steps to increase the productivity of information technology
         professionals, improve the quality of deliverables produced and
         increase PacifiCare's satisfaction levels, as required to meet or
         exceed the Service Levels. Supplier's Quality Assurance
         responsibilities shall include the following:

                  Maintain compliance with a published and agreed-upon Quality
                  Assurance Manual.

                  Maintain Equipment and Software in accordance with this
                  Agreement.

                  Document and implement process improvements.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      113.
<PAGE>
                  Identify best practices, where applicable.

                  3.       TRAINING AND EDUCATION:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  SKILLS MANAGEMENT:

                  Provide training, which shall vary by individual and by job,
         and shall take many forms including computer-based, multimedia,
         instructor-led, and self-study courses as well as seminars and
         workshops.

                  The primary form of in-scope education support shall be
         provided through the Help Desk and level 2 support. The Web enabled
         product can offer another avenue for advice and support, which shall
         allow End-Users to get solutions and or assistance for computer related
         problems via the Internet with customized sections for End-Users.

                  The level of support and skills that are required to complete
         the activity for PacifiCare shall be defined through the problem
         management process and tracked through the Help Desk and level 2 and 3
         support.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  At no additional cost, Supplier shall provide the following
                  training and education:

                  NEW END-USER TRAINING. Supplier shall [...***...] of
                  instructor-led group training for new End-Users. Such training
                  shall, include the following:

                  [...***...]

                  END-USER TRAINING. Supplier shall investigate the needs for
                  training. Supplier shall provide [...***...] of instructor-led
                  group training per month for individual products either on a
                  requested basis or as a proactive step as a part of an
                  implementation project of a new technology /product. Such
                  training shall be customized so that it is specific to the
                  End-Users for the Services within PacifiCare's environment.
                  Supplier shall provide user

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      114.
<PAGE>
                  training and associated user guide documentation for all
                  Services. Supplier's End-User training responsibilities shall
                  include the following:

                  [...***...]

                  4.       PROJECT SUPPORT:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  As of the Cutover Date, Supplier shall use its standard
         project methodology to provide consistent results for each
         infrastructure project. Supplier's project support responsibilities are
         described in Exhibit 1 hereto and shall include the following:

                  Manage all Supplier tasks across the Services and Service
                  Locations, coordinating with appropriate PacifiCare personnel.

                  Prepare project proposals as appropriate.

                  Develop functional and /or technical requirements and project
                  plans to include cost, ongoing maintenance and support
                  requirements, risks, alternatives, recommendations, with
                  specific references to any variances to PacifiCare standards.

                  Develop, build, buy or reuse technology components that shall
                  meet functional requirements with PacifiCare approval.

                  Test, and as appropriate, pilot, integrate and install
                  technology components to verify that the new installation does
                  not cause unexpected negative impact to the existing
                  infrastructure or environment. Also, include PacifiCare
                  personnel in the testing of new products, when appropriate,
                  and/or changes to existing systems. PacifiCare personnel shall
                  also be required to approve all testing results.

                  Facilitate standardization to comply with PacifiCare technical
                  requirements.

                  Manage all Supplier and third party supplier tasks across
                  service families, coordinating with appropriate PacifiCare
                  personnel.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      115.
<PAGE>
                  Use project management tools (i.e. MS Project) for all
                  projects, and employ a regular reporting mechanism to identify
                  project tasks, present current status reports (utilizing
                  PacifiCare's Project Summary form), and identifying potential
                  bottlenecks and problems.

                  [...***...]

                           Monitor the project process and report on progress.

                           [...***...]

                  5.       BUSINESS METRICS:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Supplier shall provide quantitative and qualitative
         metrics for all functions aligned with business requirements in
         accordance with Service Level Schedule 8.

                  6.       NEW TECHNOLOGY AND AUTOMATION:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  The Supplier Program Office shall work with the appropriate
         Supplier technical staff and architects to provide recommendations and
         evaluation of new technology and of automation tools [...***...]

                  The Supplier Program Office shall work with the PacifiCare
         Architectural Review Board to provide:

                  -        A forum for cross-functional communication to develop
                           strategies and integrated solutions based on
                           PacifiCare requirements. These solutions shall be
                           focused on the delivery of increased value in a
                           cost-effective manner.

                  -        Cross team and platform communication of technology
                           strategies.

                  -        Monitoring of leading edge technology and an
                           evaluation of the reliability and application to
                           PacifiCare's environments.

                  -        Participation in the development of proof of concepts
                           [...***...].

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      116.
<PAGE>
                  -        Participation in architecture governance processes
                           [...***...]

                  -        Participation in updating PacifiCare architecture
                           documentation [...***...]

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Working with the retained PacifiCare staff, the Supplier shall
         support new technology and automation, including emerging Equipment,
         Software, methodologies, techniques, and various Platforms within
         existing baselines being provided by [...***...]. Services shall
         include investigation, evaluation, selection, training, implementation,
         and consulting on new technology and automation of manual tasks.
         Supplier's responsibilities for new technology and automation shall
         include the following:

                  -        Support PacifiCare in the management and
                           representation of technology product and service
                           offerings to its internal clients. Supplier shall
                           work with PacifiCare as required to identify new
                           products and services that reflect evolving
                           technology and /or client demands.

                  -        Facilitate and encourage active cross-functional,
                           cross-group and cross-location coordination and
                           communication. This working practice shall be a key
                           element in most functions and processes, but
                           especially Problem Management, Change Management and
                           Project Management.

                  -        Provide, on the schedule specified by PacifiCare in
                           support of PacifiCare's annual budget development
                           cycle, the input, assistance, comment and review
                           support for [...***...]

                  -        Participate, from time to time, in evaluations
                           involving other third party suppliers.

                  -        Make available its facilities where new third party
                           products are evaluated and provide, upon PacifiCare's
                           request, any reports, summaries, or results of such
                           evaluation and testing.

                  -        Define requirements for automation.

                  -        Automate manual monitoring functions.

                  -        Automate alerts to system operators.

                  -        Automate generation and routing of problem tickets to
                           technical support groups (irrespective of location).

                  -        Research tools to improve Service Levels or
                           performance of operating environments.

                  7.       PHYSICAL SECURITY ADMINISTRATION:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier's responsibilities to provide physical security
         administration shall be in accordance with the Agreement, Section 10.2.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      117.
<PAGE>
                  8.       LOGICAL SECURITY ADMINISTRATION:

                  SUPPLIER'S SOLUTION DESCRIPTION: Supplier's responsibilities
         to provide logical security administration shall be in accordance with
         the Agreement and as described in Safety and Security Procedures
         Schedule 10.2. Supplier realizes that system security is a major
         concern with PacifiCare and Supplier shall work with PacifiCare to
         validate that PacifiCare's security policies and standards are being
         strictly adhered to.

                  [...***...]. In addition, Supplier shall work with PacifiCare
         to validate that the system security Software is implemented in such a
         manner as to allow PacifiCare to perform PacifiCare's functions
         effectively and protect PacifiCare's systems anD data.

                  In conjunction with PacifiCare, the Supplier Security
         Compliance team shall develop and maintain an overall IT Security
         architecture to address PacifiCare's requirements for a secure and
         effective corporate and operational environment. [...***...].

                  [...***...].

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  In accordance with the Safety and Security Procedures,
         Schedule 10.2. Supplier shall adhere and demonstrate compliance to an
         information security approach [...***...]. Supplier shall manage and
         administer access to [...***...]. PacifiCarE SHALL retain authority for
         approval of all data and system access requirements and notify Supplier
         what entities and personnel are to be granted access to the
         Supplier-operated systems and the level of security access granted to
         each. Supplier management shall authorize access for their employees
         based on current security procedures. PacifiCare security shall retain
         oversight accountability. PacifiCare business management shall retain
         authority for approval of all data and system access requirements for
         their employees. Supplier shall follow PacifiCare's instructions and
         shall follow the procedures regarding such access as designated by
         PacifiCare. [...***...]

                  Review all documented information security procedures with
                  PacifiCare pertaining to the Supplier-operated systems.
                  Develop, maintain, update, and implement security procedures
                  with PacifiCare's review and approval, including physical
                  access strategies and standards, and a breach of security
                  action plan. Implement, maintain and update PacifiCare's
                  security policies.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      118.
<PAGE>
                  Develop, implement, and maintain a set of automated and manual
                  processes designed to enforce PacifiCare's data access rules.
                  Supplier shall also provide commercially available, third
                  party tools designed to prevent un-deleting or recovering of
                  file and data deleted by certain individuals identified by
                  PacifiCare.

                  Establish procedures for resetting passwords.

                  Maintain security rules.

                  Provide security policy implementation.

                  Supplier shall assign and reset passwords as approved by
                  PacifiCare.

                  Follow up with End-Users to clarify ID administration
                  requests.

                  Supplier shall be responsible for the implementation (and
                  maintenance of an online database) of all access requests,
                  access rights lists, and for password management.

                  Supplier shall be responsible for user ID administration and
                  shall conduct such administration in accordance with the
                  Safety and Security Procedures, Schedule 10.2. Supplier's
                  responsibilities shall include the following:

                  [...***...]

                  Monitor users of the processing environment for authorized
                  access. Monitor, review and respond in a timely and
                  appropriate manner to access violations. Conduct periodic
                  reviews as appropriate to validate that individual employee
                  access to programs and libraries is appropriate.

                  Capture data regarding routine access and exceptions for audit
                  trail purposes, and make such data available to PacifiCare
                  upon request.

                  Establish and administer violation and access attempts report
                  mechanisms. Promptly provide written reports of all
                  information security breaches discovered or made known to
                  Supplier. Initiate corrective actions to minimize and prevent
                  further breaches to the extent within Supplier's control.
                  Prepare and retain documentation of breach investigations and
                  provide copies to PacifiCare.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      119.
<PAGE>
                  Provide application development security support and advice.

                  Where there is a security violation or unauthorized attempt to
                  access data, immediately bring such incident to the attention
                  of PacifiCare Corporate Information Security.

                  Provide security access control tools for data, databases,
                  applications, operating systems, and networks in compliance
                  with PacifiCare security policies, standards and procedures,
                  and maintain such security and access control devices in
                  proper working order.

                  Install, maintain and administer security databases.

                  Perform backup and recovery procedures in response to security
                  violations that result in lost/damaged information.

                  Perform security audits to verify that appropriate security
                  procedures are in place. [...***...]

                  Report logical security violations to PacifiCare's Corporate
                  Information Security.

                  At the level appropriate for Supplier's performance of
                  day-to-day security functions, consult with PacifiCare to
                  identify security risks and, subject to PacifiCare's approval,
                  recommend and implement procedures to minimize such risks.

                  Establish and maintain safeguards against the unauthorized
                  access, destruction, loss or alteration or PacifiCare data in
                  the possession of Supplier that are no less rigorous than the
                  most rigorous practices actually performed by PacifiCare or
                  Supplier as of the Effective Date in connection with the
                  respective PacifiCare-owned or Supplier-owned systems.

                  Supplier and its subcontractors shall provide PacifiCare with
                  evidence of a successful SAS 70 audit and an action plan and
                  timeline for any required remediation activities on an annual
                  basis.

                  Maintain current application security architecture,
                  [...***...]

                  Provide an environment where computing resources are
                  firewalled from all of the other Suppliers' customers as well
                  as from external threats.

                  Place all PacifiCare data on dedicated resources and
                  specifically not co-mingle PacifiCare data with the data of
                  other Supplier customers.

                  Conduct regular penetration tests and vulnerability
                  assessments of PacifiCare's network security and remediate
                  weaknesses within [...***...].

                  Implement all security patches within a [...***...].

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      120.
<PAGE>
                  Define and implement processes and protocols for interfacing
                  with Corporate Information Security to ensure consistency in
                  the protection of PacifiCare information and computing assets.

                  9.       ON-GOING BUSINESS DIVESTITURES AND ACQUISITIONS:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall support PacifiCare Included Affiliates per
         Exhibit C in accordance with the Agreement. Supplier shall provide
         services to additional business units in accordance with the Agreement.

                  10.      CONSOLIDATION AND RELOCATION SERVICES:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  To minimize disruption to PacifiCare in the event of any work
         consolidation or relocation, Supplier shall work with PacifiCare to
         initiate a project to plan for this event. [...***...]. Supplier shall
         work with PacifiCare to provide complete ANd accurate communication on
         the project and to obtain PacifiCare's concurrence.

                  The Project Manager shall be responsible for validating that
         all services (i.e. IMACs, infrastructure changes) being provided by
         Supplier are addressed and planned appropriately to manage a smooth
         transition. In addition, [...***...].

                  Supplier shall also review [...***...]. Adjustments to these
         plans shall be made to verify that PacifiCare's requirements continue
         to be met.

                  11.      LICENSE MANAGEMENT AND COMPLIANCE:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Each Party shall comply with the terms and conditions of the
         Consents applicable to such Party under Section 3.4, Third Party
         Consents, of the Agreement. Supplier shall deploy consistent and
         uniform standards in managing and maintaining license compliance.

                  For Desktop and Distributed, [...***...].

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier's responsibilities shall include the following, as
         applicable:

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      121.
<PAGE>
                  Provide periodic reporting of such license information to
         PacifiCare, as required.

                  File and track Software license agreements.

                  Proactively scan for pirated Software.

                  Report any known Software license anomalies.

                  12.      INSTALLS, MOVES, ADDS, AND CHANGES:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Installs, moves, adds, and changes shall be executed through
         the install, move, add, and change (IMAC) process described in the Fee
         Schedule to the Agreement hereto.

                  13.      CRISIS MANAGEMENT:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier shall provide IT services required in response to a
         Corporate Crisis. Resources and requirements shall be determined at the
         time of the crisis. Other specific Supplier responsibilities include:

                  Provide appropriate support when a crisis is declared.

                  Report crisis events.

                           Perform root cause analysis of problems.

                  14.      COLLABORATIVE APPLICATIONS:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall support the [...***...] e-mail servers and
         [...***...]. Supplier shall provide recommendations for improving the
         [...***...] environment, as appropriate. The client portion of the
         e-mail environment is [...***...]. [...***...] is considered part of
         the PacifiCare Software that is supported by the Help Desk. The
         End-Users shall be supported by either remote control from the
         PacifiCare Help Desk, on-line knowledge base, or a desk-side visit from
         a technician.

                  Supplier shall advise PacifiCare on the effective use of
         [...***...]. As opportunities arise that can contribute to PacifiCare's
         business environment or improve productivity, they shall be brought to
         the attention of PacifiCare through THE Supplier. If PacifiCare agrees,
         a New Service request shall be prepared and presented to PacifiCare for
         approval.

                  For intranet/Internet, Supplier shall manage the [...***...].

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      122.
<PAGE>
                  Supplier shall automatically [...***...], as directed by
         PacifiCare, or advised on a regular basis. This is included in the Base
         Fees.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  For all PC End-Users, Supplier shall install electronic mail
         to include mail directory service, database management, Remote user
         access, access to dissimilar mail system (e.g. Internet, etc.),
         performance/systems tuning, and electronic mail applications services.
         Supplier shall be responsible for maintaining version levels consistent
         with Policy and Procedures Manual, Schedule 13.4.

                  Supplier shall be responsible for deploying and supporting the
         collaborative applications defined in Schedule 14.2(b) within
         PacifiCare. The collaborative applications environment includes such
         applications and functions [...***...]

                  Administering and maintaining Outlook services.

                  Administering and maintaining electronic mail services.

                  Administering and maintaining Internet IDs, passwords, etc.

                  15.      CHARGEBACK:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall provide sufficient invoice charge details to
         support PacifiCare's chargeback system. This shall include invoicing
         details but shall not include a chargeback application.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  [...***...]. Supplier shall provide lists of charges in both
         hard and soft copy. At a minimum, Supplier shall provide to PacifiCare
         invoice information by legal entity, by business unit, by site, by
         [...***...]. Supplier shall also provide PacifiCare on-line access to
         this information in a database that lends itself to searching and
         recurring reporting.

                  16.      EFFECTIVE USE OF THE EQUIPMENT:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall make recommendations on how Supplier believes
         the technical environment could be better utilized. Supplier shall work
         to consolidate systems where feasible

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      123.
<PAGE>
         [...***...] in support of PacifiCare. Where feasible, Supplier
         [...***...].

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier, [...***...], shall identify strategies and
         approaches for future information technology delivery within PacifiCare
         that Supplier believes shall provide PacifiCare with competitive
         advantages and identify and review with PacifiCare opportunities that
         the Supplier has observed during the course of providing the Services,
         that could result in increased efficiency, performance, or cost savings
         ([...***...]).

                  17.      REDEPLOYMENT AND DISPOSAL:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The functions of re-deploying, cascading, and disposing of
         Equipment shall be addressed by the IMAC process as described in
         Schedule 17.

                  18.      PROJECT MANAGEMENT:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  Supplier's responsibility for project management for projects
         other than applications projects is described in Exhibit 1 hereto and
         shall include the following:

                  Supplier shall implement Supplier management methodology
                  including the use of project management tools..

                  Supplier shall prepare and provide to PacifiCare periodically
                  [...***...] a series of performance, financial, utilization
                  and status reports, and those that PacifiCare reasonably
                  identifies or changes in the future.

                  Supplier shall provide PacifiCare with timely access to
                  information in an electronic format.

                  Supplier shall prepare annually and/or as requested and
                  provide to PacifiCare a scope of work definition.

                  Supplier representatives shall meet with representatives of
                  PacifiCare as necessary and appropriate to manage and deliver
                  the Services effectively. Supplier shall support and
                  participate in the various account management committees
                  called for by the Agreement and the procedures adopted by the
                  Parties to charter each such committee. Supplier shall
                  participate in related PacifiCare business and technology
                  planning meetings upon request to review operations and
                  business plans and recommend appropriate information
                  technology services to support plan execution.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      124.
<PAGE>
                  Supplier shall maintain appropriate levels of industry
                  knowledge in PacifiCare's business through, among other
                  activities, participation in industry meetings, forums and
                  conferences.

                  19.      VIRUS PROTECTION:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  For all Services, Supplier shall install, update, operate and
         maintain Virus protection Software on the Equipment. Supplier shall use
         reasonable efforts to prevent Virus introduction into the PacifiCare
         Systems, including the following:

                  Supplier shall monitor for, install, update, operate and
                  maintain Virus protection Software including protection
                  against worms, Trojan horses and other types of malicious
                  code. Updates to Virus protection Software shall be installed
                  on applicable servers and made available to End-Users of PCs
                  within five business (5) days of general release. [...***...].
                  Supplier shall automatically set Virus scans for desktops and
                  laptops on a [...***...] basis and on demand. Supplier shall
                  peRform Virus scans also on incoming (from external sources
                  including via the internet) and outgoing electronic mail.

                  Supplier shall actively monitor early warning alerts from
                  Virus vendors and their websites that broadcast
                  vulnerabilities and take proactive action to protect the
                  environment. Supplier shall utilize Software ([...***...]) to
                  block outbound internet access to web-based email sites.
                  Supplier shall utilize anti-Virus Software [...***...]on
                  workstations and laptops and make Software available for
                  in-scope home Equipment. Supplier shall utilize anti-Virus
                  Software [...***...] on all distributed computing servers.
                  Supplier shall utilize Software [...***...] on all groupware
                  ([...***...]) servers. In the event of a Virus incident,
                  Supplier shall follow PacifiCare's process whereby remote
                  users shall be disallowed from accessinG the network until
                  Virus level certification is demonstrated. Supplier shall
                  review and update such process on a periodic basis, subject to
                  PacifiCare's approval. [...***...]

                  Upon detection of a Virus, Supplier shall take immediate
                  action as outlined in PacifiCare's Infrastructure Continuity
                  Program Charter, which will be included as part of the Policy
                  and Procedures Manual, and work with PacifiCare Security/CIRT
                  (Computer Incident Response Team) to assess the scope of
                  damage, and arrest the spread and progressive damage from the
                  Virus. CIRT operating guidelines are outlined in PacifiCare's
                  Infrastructure Continuity Planning Program Charter, which will
                  be included as part of the Policy and Procedures Manual.
                  Supplier shall take steps to salvage or restore as much of the
                  impacted file server data and Software as possible. Supplier
                  shall verify that the Virus

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      125.
<PAGE>
                  protection Software supplied by PacifiCare has the capability
                  to do the above referenced activities.

                  Supplier shall take steps to reasonably ensure that Supplier,
                  non-Supplier, and non-PacifiCare personnel have the required
                  anti-Virus protection installed on their personal
                  computers/laptops before being allowed to connect to the
                  network. Supplier shall review and update such process on a
                  periodic basis, subject to PacifiCare's approval.

                  Supplier shall install and maintain commercially available
                  Virus protection Software on [...***...].

                  If PacifiCare engages a third party risk management,
                  advisory/alert consulting or subscription service, Supplier
                  agrees to implement an agreed upon project in a timely manner,
                  including the recommended security Equipment, Software,
                  patches, fixes, version upgrades, manual and/or automated
                  policies, procedures, processes, to proactively prepare for
                  and reduce the risk of Virus incidents.

                  Supplier shall maintain statistics on Virus incidents that
                  successfully infect the environment and provide those
                  statistics upon request to PacifiCare.

                  20.      PACIFICARE ONGOING PROJECTS AS OF EFFECTIVE DATE:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  The Change Control Procedures and/or Change Management
         Procedures as applicable shall be used to address any changes in scope,
         requirements, or schedules in respect of the ongoing projects.

                  21.      REPORTING:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  In addition to report requirements described in this
         PacifiCare Statement of Work, Supplier, after satisfying the PacifiCare
         Service Level requirements for initial production and delivery, shall
         publish and provide in an electronic format, suitable for use on a PC,
         reports described in Schedule 3.9.d Reports.

                  22.      MEETINGS BETWEEN PACIFICARE AND SUPPLIER:

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  In addition to meetings in the normal course of business to
         address the quality and timely provision of the Services, Supplier and
         PacifiCare shall meet on a regular basis to review operations controls,
         Service Level results, executive reviews, etc.

                  23.      LONG-RANGE INFORMATION SYSTEMS PLAN AND
                           EQUIPMENT/SOFTWARE ARCHITECTURE:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      126.
<PAGE>
                  In support of PacifiCare's strategic planning and architecture
         processes, Supplier shall assist PacifiCare in defining a strategy for
         information technology architectures and standards on an ongoing basis
         [...***...]. Supplier shall work wITH PacifiCare to support PacifiCare
         technical architecture review board. [...***...].

                  Supplier shall assist PacifiCare with preparing long-term
         strategic information technology plans and short-term implementation
         plans on an annual basis. [...***...].

                  Supplier shall work with PacifiCare to integrate its specific
         IT architecture strategy, Enterprise Systems Management Architecture
         (ESMA), described in Exhibit 1 hereto.

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  [...***...]. Supplier's responsibility for such functions
                  shall also include the following:

                  Assist PacifiCare in developing an understanding of and
                  confirm the business requirements.

                  Assist in identifying information and associated technology
                  needs.

                  Assist in identifying the projects to be performed along with
                  helping define schedules and high-level cost benefit analysis.

                  Assist in specifying the Equipment/Software architecture and
                  participate in continuously keeping PacifiCare's IS
                  Architecture current.

                  24.      POTENTIAL VALUE ADDS:

                  The following potential value adds are included in the Base
                  Fees.

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  PacifiCare has the opportunity to participate with the
         Supplier team in site visits, position papers, and recommendations.

                On an ongoing basis, consistent with the Agreement, [...***...].

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      127.
<PAGE>
                  The e-ESM tool supports and integrates all the service areas
                  within the PacifiCare solution. [...***...].

                  Project Management Methodology: The Supplier team shall use a
                  consistent project management approach across all of the
                  Services. [...***...].

                  Tools The system management tools that are utilized by
                  Supplier in the delivery of the base solution [...***...].
                  After Supplier assumes the transitioned Equipment and Software
                  from PacifiCare, the tools shall utilized to manage the
                  operatioNaL environment and to facilitate event correlation
                  and handling. [...***...].

                  Technology Methodology: Supplier shall implement a suite of
                  delivery standards and processes that have been proven in many
                  customer and Supplier delivery environments. These processes
                  are implemented at all Supplier delivery organizations
                  throughout the world. Formal systems management controls
                  (SMC), based on Supplier's experiences and the client's
                  business requirements, shall be implemented consisting of:

                  [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      128.
<PAGE>
                  [...***...]

                           [...***...]

                  PACIFICARE'S FUNCTIONAL REQUIREMENT:

                  MISCELLANEOUS TOOLS AND PROCESSES

                  Supplier shall utilize tools and processes, [...***...],
         during the performance of Services. A description of these tools and
         processes is set forth in Exhibit 1 hereto.

                  25.      DISASTER RECOVERY:

                  SUPPLIER'S SOLUTION DESCRIPTION:

                  Supplier shall manage the [...***...] PacifiCare IT Disaster
         Recovery Plan. Supplier shall provide a Disaster Recovery (DR)
         Coordinator for the overall Disaster Recovery Project Management of the
         DR service provider. The role of the Disaster Recovery Coordinator
         shall be as follows:

                  PRE-DISASTER RESPONSIBILITIES

                  Develop and maintain disaster process and documentation.
                  Supplier shall use the standard Supplier Service Delivery
                  Center Disaster Recovery Plan Template controlled document.
                  This document has been audited and found to be in compliance
                  with applicable [...***...].

                  Prepare for formal and informal disaster recovery reviews
                  (audits).

                  Conduct an annual DR Plan review.

                  Maintain a copy of the plan as a vital record.

                  [...***...].

                  POTENTIAL DISASTER RESPONSIBILITIES

                  Notify the Disaster Recovery Team Manager, DR service
                  provider, and off-site storage of Potential Disaster Alert
                  Status.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      129.

<PAGE>

            Await notice from the DR service provider as to which centers are
            currently available should an official disaster be declared.

            Act as an interface between Supplier, PacifiCare, and the DR service
            provider.

            DISASTER RESPONSIBILITIES

            Notify Disaster Recovery Team Leaders, the DR service provider, and
            off-site storage of Declared Disaster Alert Status.

            Act as an interface between Supplier, PacifiCare, and the DR service
            provider.

            Act as the focal point for recovery status and activity to the
            Supplier Crisis Management Team.

            POST-DISASTER RESPONSIBILITIES

            [...***...].

            Review recovery requirements and update existing PacifiCare DR
            service provider agreements when applicable.

            Review the recovery and update the plan.

            TESTING RESPONSIBILITIES

            Coordinate [...***...], or as otherwise specified by PacifiCare,
            [...***...].

            Develop a Disaster Recovery Test Plan. [...***...]. This document
            has been audited and found to be in compliance with applicable
            [...***...].

            Develop Disaster Recovery Test Success Criteria.

            Develop auditable Disaster Recovery Test Results. [...***...]. This
            document has been audited and found to be in compliance with
            applicable [...***...].

            Maintain a problem log and timeline during the test.

            Hold pre-test plan meetings with PacifiCare personnel and
            representatives as appropriate.

            Hold post-test review meetings to discuss and track problems to
            closure from each test.

            Verify that the Disaster Recovery Plan is updated as necessary.

            THE DISASTER RECOVERY PLAN

            The Disaster Recovery plan includes:

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      130.
<PAGE>
            [...***...]

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      131.
<PAGE>
            [...***...]

            [...***...] DISASTER RECOVERY SUPPORT

            Supplier shall:

            Direct development and maintenance [...***...].

            Coordinate and monitor the scheduling, planning and annual testing
            of [...***...].

            Prepare and distribute [...***...], outlining exercise results and
            action items.

            Track and monitor completion of action items from [...***...]
            Disaster Recovery tests.

            Train all members of [...***...] Disaster Recovery Teams.

            Participate in the design and implementation of [...***...]
            alternate/hot-site disaster recovery strategies.

            The Supplier shall manage, administer and maintain [...***...].

            During the Transition Period, Supplier shall work with PacifiCare to
            fully understand PacifiCare's specific requirements for disaster
            recovery and the current processes, procedures, systems, and tools,
            which are in place to react to and manage telecommunications
            disasters that cause crisis situations. Once this is completed,
            Supplier shall support disaster recovery as is currently supported.
            Supplier shall manage as Managed Agreements, PacifiCare's existing
            contracts relating to disaster recovery services.

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            The Supplier shall put plans in place and conduct periodic disaster
      recovery tests. [...***...]:

            Develop and maintain the Disaster Recovery Plan.

            Coordinate Disaster Recovery testing.

            Perform Disaster Recovery testing [...***...]. Supplier shall also
            be responsible to conduct testing of those plans, and shall retest
            within [...***...] if any disaster simulation(s) fail to achieve
            specified results due to Supplier's failure to perform

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      132.
<PAGE>
            its responsibilities. If the DRP testing encounters errors, Supplier
            shall develop procedures and retest as necessary to resolve such
            errors and update the DRP as necessary.

            Report and review with PacifiCare Disaster Test results.

            Maintain Disaster Recovery procedures manuals.

                  Implement the Disaster Recovery Plan upon the occurrence of a
            disaster.

            [...***...].

            The Supplier is responsible for providing operational and technical
            management support for disaster recovery telecommunications
            planning, testing, and execution in crisis situations. Supplier is
            responsible for training personnel in disaster recovery procedures
            and providing access to these procedures in a crisis situation. The
            Supplier shall also be responsible for making sure all contingency
            policies and procedures comply with PacifiCare standards and are
            current with no exceptions. Other Supplier responsibilities include:

            Perform back up and recovery.

            Perform contingency testing.

            Perform battery plant management.

            Identify single points of failure.

            Plan and propose redundancy support across multiple Call Centers to
            reduce chances of outages.

            Perform disaster recovery testing as stated in the Agreement,
            section 16.1 and in Schedule 8.

            Implement the Disaster Recovery Plan upon the occurrence of a
            disaster.

            Provide Disaster Recovery (DR) program management including:

            Coordination of the maintenance, planning, testing and reporting of
            IDC DR plans

            Coordination of IDC Change Management Procedures to DR Hot Site
            vendor per Managed Agreement for maintaining Equipment
            configurations, Software /forms modifications or additions and/or
            procedure changes.

      26.   BUSINESS CONTINUITY SERVICES:

            SUPPLIER'S SOLUTION DESCRIPTION: BUSINESS CONTINUITY AND RECOVERY
            SERVICES METHODOLOGY

            Supplier's business continuity and recovery services methodology
      shall contribute to the planning and implementation of a contingency and
      recovery process to meet PacifiCare's

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      133.
<PAGE>
      requirements for business continuity by using a phased approach that is
      based on industry best practices. [...***...]:

                  [...***...]

            PHASE 1

            [...***...]

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      134.
<PAGE>
            [...***...]

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      135.
<PAGE>
            [...***...]

            The impacts to PacifiCare's staff, for training and support

            PHASE 2

            [...***...]

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      136.
<PAGE>
            [...***...]

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      137.
<PAGE>
            [...***...]

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall be responsible to manage and maintain the Business
      Continuity Plans and associated resources in place as they are actually
      performed by PacifiCare as of the Cutover Date and as they pertain to
      Services for which Supplier is otherwise responsible, and to extend those
      capabilities to additional Equipment and applications over the Term and
      during the Termination Assistance Period. Supplier shall also be
      responsible to conduct testing of those plans, and shall retest
      [...***...] if any disaster simulation(s) fail to achieve specified
      results due to Supplier's failure to perform its responsibilities.
      Supplier's responsibilities in respect of business continuity services
      under this Statement of Work shall be limited to the business continuity
      services in effect (in respect of the Services) on the Cutover Date or to
      such enhancements to such responsibilities as Supplier and PacifiCare
      shall mutually agree. Whether a Business Continuity Plan exists or not,
      any recommendations made by Supplier must, at a minimum, provide
      capabilities for restoration of Services within the timeframes specified
      by PacifiCare.

            BUSINESS CONTINUITY - SERVICES.

            Supplier's responsibilities to provide Business Continuity Services
            to PacifiCare shall include the following:

            Plan and coordinate plans, operations, and technology requirements
            with third party contingency providers.

            With respect to the Application servers and LAN servers at
            facilities in which Supplier personnel are located, Supplier shall
            provide, and maintain on magnetic media or other media mutually
            agreed to by the Parties and accessible to PacifiCare, backup,
            [...***...]. Supplier shall perform such functions in accordance
            with standards and procedures specified in Schedule 16.1, Disaster
            Recovery Plan and which shall be no less stringent that the
            standards and procedures used at well-managed operations providing
            functions similar to the Services.

            Supplier shall back up (and verify that such back ups have been
            properly completed) the data and Software residing on the server
            Systems in accordance with Business Continuity Plan.

            When PacifiCare is conducting its Business Continuity test, Supplier
            shall participate, as necessary, to demonstrate to PacifiCare that
            the Business Continuity Plan is capable of recovering the PacifiCare
            applications and data.

            Perform, or with respect to the Remote sites where Supplier does not
            have on-site personnel, assist PacifiCare's on-site personnel to
            perform, [...***...] backup of all servers.

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      138.
<PAGE>
            Provide design and other consulting support for networking
            requirements at the contingency site, including such support for
            local connectivity to required servers and printers.

            Support connectivity to PacifiCare's mission critical production
            network and the production host systems or to the contingency
            network and the recovery sites as required by the Business
            Continuity Plan.

            Support connectivity from the contingency site to all external
            Suppliers and other organizations, as required by the Business
            Continuity Plan.

            In the event of a disaster, provide restoration of services as
            required of the Supplier by the Business Continuity Plan. Ensure
            that data is recovered to the appropriate point in time as required
            by each application and as defined by the Business Continuity Plan.

            Provide testing support services, which may include configuration
            maintenance, server restoration, and application testing support.

            Provide [...***...] training for appropriate PacifiCare Business
            Continuity teams.

            BUSINESS CONTINUITY PLAN.

            Supplier shall, with respect to the Services existing as of the
            Cutover Date, develop and maintain PacifiCare's Business Continuity
            plans, which describes (i) the manner in which Supplier shall
            perform backup and Business Continuity functions, and (ii)
            PacifiCare's priorities for backup and Business Continuity and
            methods for changing those priorities. PacifiCare's Business
            Continuity Plan as of the Cutover Date, as required to be expanded
            and improved by Supplier pursuant to this PacifiCare Statement of
            Work, shall be the "BUSINESS CONTINUITY PLAN." Supplier shall comply
            with the business continuity policies, standards and procedures in
            PacifiCare's Business Continuity Plan. During the Term and the
            Termination Assistance Period, Supplier shall incorporate any
            reasonable comments or suggestions by PacifiCare into the Plan,
            including evolving the Plan to fully cover new and evolving
            architectures. Notwithstanding the foregoing, PacifiCare shall
            retain the right to approve the Business Continuity Plan as Supplier
            may modify it from time to time. Without limiting the generality of
            the foregoing, Supplier's responsibilities with respect to the
            Business Continuity Plan shall include the following:

            Perform gap analysis of PacifiCare's Business Continuity Plan
            existing as of the Cutover Date, and develop plans to address any
            open issues as described in the Agreement.

            Develop a process that shall determine and modify the list of
            mission critical applications on an annual basis with PacifiCare's
            input and approval.

            Provide Business Continuity Plan input with respect to physical
            design considerations.

            Document Business Continuity standards and procedures subject to
            PacifiCare's final approval.

            Work with PacifiCare to incorporate security measures, as defined
            for normal operations, into the Business Continuity Plan.

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      139.
<PAGE>
            Assist PacifiCare in the development of technology strategies to
            meet PacifiCare business unit continuity requirements. Regularly
            ([...***...]) review such continuity requirements to update the
            Business Continuity Plan.

            Maintain and update the Business Continuity Plan to reflect addition
            of New Equipment for which Supplier is responsible.

            Assume responsibility for implementing, maintaining, evolving,
            upgrading and testing the plans.

            Assume coordination and administrative responsibility for third
            party Suppliers utilized by PacifiCare in the performance of
            testing.

            Propose Business Continuity Plan modifications and perform problem
            resolution and re-testing of all unsuccessful test components in
            timely manner. At PacifiCare's request, this may include additional
            tests.

            For PacifiCare and Supplier, maintain a list of key personnel
            contacts and notification procedures.

            Train Supplier and PacifiCare personnel in Business Continuity
            procedures and implement a process to obtain immediate access to
            such procedures in a crisis situation.

            Maintain current, without exception, all contingency policies and
            procedures for the Services for which Supplier is responsible.

            TESTING, DECLARATION, AND OTHER DUTIES.

            In addition to the responsibilities set forth in this Section,
            Supplier's responsibilities shall include the following:

            Establish joint test objectives with PacifiCare designed to verify
            that PacifiCare's systems for which Supplier is responsible shall be
            available within established timeframes.

            Subject to the availability of the PacifiCare-designated Business
            Continuity test site, schedule and conduct tests of the Business
            Continuity Plan at least annually in cooperation with PacifiCare and
            its designees and Business Continuity provider. Supplier shall
            schedule testing dates with PacifiCare's approval, which shall not
            be unreasonably withheld. PacifiCare and its representatives shall
            be given the opportunity to observe and participate in the tests.

            Operate the Services during periodic Business Continuity tests.

            Provide PacifiCare with a formal report of the test results within
            thirty days of each test and report feedback from End-Users as to
            the adequacy of backup for their respective areas. Such formal
            report shall include a plan and a schedule for implementing such
            plan to remedy any gaps revealed during testing. Supplier shall
            update the Business Continuity Plan to remedy defects identified
            during testing.

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      140.
<PAGE>
            For PacifiCare Service Locations, identify disasters to PacifiCare
            immediately upon identification and consult with PacifiCare for
            declaration. PacifiCare shall be responsible for declaration of
            disasters with respect to PacifiCare Service Locations.

            For all facilities for which Supplier has oversight responsibility,
            declare disasters in accordance with procedures existing at the time
            of declaration and notify PacifiCare of situations that may escalate
            to disasters as soon as practicable.

            Determine, in accordance with the Business Continuity Plan, what
            business continuity resources to deploy in the event of a disaster,
            and conduct, supervise, and administer the operation and
            implementation of such resources.

            In the event of a disaster, execute the Business Continuity Plan
            including assumption of the responsibility to operate the Equipment
            restoring the Software, and providing the functions in accordance
            with the Business Continuity Plan.

            Provide a single point of contact for Business Continuity related
            communications and activities that are Supplier's responsibility.

            [...***...]

            Identify opportunities for improvement and efficiencies in Business
            Continuity functions.

            Generate a report following each and any Business Continuity test or
            disaster measuring performance against the Business Continuity Plan
            and identification of problem areas and plans for resolution.

            Following any crisis, conduct a post-crisis meeting with PacifiCare
            to understand that cause of the crisis and develop plans to
            eliminate or mitigate future occurrences.

      27.   ASSET INVENTORY MANAGEMENT AND MAINTENANCE:

            SUPPLIER'S SOLUTION DESCRIPTION:

            The Supplier inventory tracking service shall address PacifiCare's
      requirements for Equipment and Software asset tracking and inventory
      tracking services. Tracking and making optimal use of the IT inventory is
      central to the effective management of any computing environment.
      [...***...].

            MAINTENANCE OF DATA

            The first step Supplier shall take is to [...***...] Combined with
            the enterprise operating procedures and

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      141.
<PAGE>
            processes that are used by the Supplier, Supplier shall [...***...].

            Supplier shall use two methods to maintain the accuracy of the
            inventory data: [...***...]. Supplier shall implement a manual entry
            process. Whether an IMAC has takeN place or a Equipment change has
            occurred as the result of a break/fix event, the changes shall be
            recorded within Supplier's asset management database. This shall
            assist the Help Desk agents [...***...]. The Help Desk agents shall
            receive an [...***...]:

            [...***...]

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            SUPPLIER AND/OR PACIFICARE DATA CENTER.

            Supplier's responsibilities to provide asset inventory management
      and maintenance for Supplier and PacifiCare Data Centers shall include the
      following:

            Establish and maintain proper and adequate facilities, Equipment
            (excluding Equipment to be supplied by PacifiCare) and supplies at
            the Supplier Data Center, and a properly trained and appropriately
            sized management and support staff.

            Properly manage, coordinate, oversee (and inform PacifiCare of the
            results) with respect to maintenance, testing and monitoring of
            facilities systems, air handlers and uninterruptible power supply
            systems at the Supplier Data Centers and PacifiCare Data Centers
            operated by Supplier.

            Provide physical security for the Supplier Data Center as more fully
            described in Section B.17 of this Statement of Work.

            Create, update and maintain complete documentation (e.g., of
            inventories, cabling and installed Equipment diagrams) of the
            PacifiCare Equipment that is part of Supplier's responsibilities.
            Use computer aided drafting (CAD) Software tools for changes to
            existing documentation and newly created documentation created by
            Supplier.

            Provide physical access strategies and standards for the Data
            Center, working with PacifiCare's Facilities department as required.

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      142.
<PAGE>
            Initiate and track requests for space, power and other Data Center
            modifications in support of Equipment installations.

            [...***...]

            SUPPLIER EQUIPMENT AND SUPPLIER SOFTWARE.

            In accordance with the Change Management Procedures, Supplier shall,
            at Supplier's cost, add, replace, and upgrade Supplier Equipment and
            Supplier Software that Supplier deems necessary to perform the
            Services and meet the Service Levels.

            Supplier shall create and maintain property removal passes for
            Equipment per the Policies and Procedures Guide.

            EQUIPMENT MAINTENANCE AND SUPPORT.

            Supplier shall provide, or arrange for qualified third parties to
            provide maintenance for Equipment for which Supplier is otherwise
            responsible hereunder as necessary to keep such Equipment in good
            operating condition and in accordance with manufacturer's
            specifications or other agreements as applicable, so that such
            Equipment shall qualify for the manufacturer's standard maintenance
            plan upon sale or return to a lessor. PacifiCare shall be
            responsible for additional costs and expenses, if any, to bring
            PacifiCare-supplied Equipment up to such standards if such Equipment
            doesn't meet such standards on the Cutover Date. Such maintenance
            shall be performed in accordance with the Change Management
            Procedures, so as to minimize the disruption to PacifiCare's normal
            business processes. Supplier's responsibility for such functions
            shall also include the following:

            Supplier shall manage the third party service providers that provide
            support.

            Supplier shall plan, order install, test and maintain all Equipment
            at Supplier-operated Data Center and work with third parties to
            resolve Equipment problems. Supplier's responsibilities include
            tracking configurations of Equipment and peripherals and maintaining
            complete configuration documentation of the Supplier-operated Data
            Center using CAD Software tools. In addition, Supplier is expected
            to provide complete Supplier-operated Data Center support for all
            environmental Equipment at the Supplier Data Center.

            With respect to distributed Equipment for which Supplier is
            otherwise responsible hereunder, Supplier shall provide break/fix,
            support, advice and assistance to End-Users. Supplier shall correct
            all problems associated with failure or maintenance of such
            Equipment. Supplier shall install PacifiCare-supplied upgrades for
            such distributed computing-related Equipment at the Service
            Locations. Supplier shall maintain a level of documentation that
            reflects the complexity and diversity of the environment and
            facilitates the Equipment support process.

            Supplier shall be responsible for coordinating rollouts and upgrades
            of Equipment. Supplier shall be responsible for coordinating any
            testing, scheduling, and installation integration of these products.
            Supplier shall also perform full testing after installation and
            provide proper back-out procedures. [...***...]

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      143.
<PAGE>
            With respect to the distributed computing environment, Supplier
            shall procure (if requested by PacifiCare), install and maintain
            Equipment, peripherals, file servers, gateways, and network /
            communications Equipment. With respect to Equipment connected to the
            network, Supplier shall maintain Equipment, peripherals, file
            servers, frame relay circuits, gateways, network/communications
            Equipment.

            Supplier shall perform the decommissioning and removal of
            distributed Equipment and shall coordinate with PacifiCare and
            advise on effective technology re-use when appropriate and feasible.
            Such decommissioning and removal shall be performed in an
            environmentally sound manner.

            Supplier shall maintain an effective inventory of all spare parts
            and Equipment used to support the Equipment for which Supplier has
            maintenance responsibility, and track such inventory in an inventory
            management database system. This inventory shall be adequate to
            allow Supplier to meet or exceed the PacifiCare Service Levels.

            Supplier shall perform all operations required to support the
            refresh and cascading of Equipment associated with providing the
            Services throughout PacifiCare's operations. This shall include:
            planning, associated change management and problem management,
            de-installation, reinstallation, configuration, staging, and user
            orientation as otherwise specified hereunder.

            ASSET INVENTORY/CONFIGURATION MANAGEMENT.

            Supplier shall conduct a wall-to-wall inventory of all Services
            Equipment and Software provided or managed by Supplier and deployed
            at the Service Locations as described below. Once PacifiCare
            approves the inventory pursuant to provisions of the PacifiCare
            Service Level Schedule, Supplier shall maintain the asset inventory
            management database for all Equipment and Software provided or
            managed by Supplier and deployed at the Service Locations pursuant
            to provisions of the PacifiCare Service Level Schedule. Supplier
            shall provide PacifiCare with online access to the asset inventory
            management database, produce periodic reports as necessary, and
            respond in a timely manner to queries and requests concerning the
            inventory data or supporting information. Supplier shall complete
            the Initial Inventory, and maintain the asset inventory database in
            accordance with and within the timeframes specified in the Service
            Level Schedule. This responsibility shall include the following:

            [...***...]

                  7. Resource Category identifier

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      144.
<PAGE>
                  8. Standard/Non-Standard designation

                  9. Mission critical designation - Provided by PacifiCare

                  10. Unique bar code identification number

                  11. Equipment manufacturer and model number

                  12. Peripherals

                  13. Upgrades

                  14. Operating system

                  15. Application Software

                  16. Protocol

                  17. Ownership and in-service date provided by PacifiCare for
                      existing assets

                  18. Lease holder and lease term. - Provided by PacifiCare

                  19. Maintenance provider and information

                  20. Physical location

                  21. PacifiCare customers

                  22. Business unit / Department Number- Provided by PacifiCare

                  23. Phone number - Provided by PacifiCare

                  24. Assigned IP address

                  25. Faceplate ID

                  26. Hub port

            On a periodic basis, update inventory database by, to the extent
            enabled in the PacifiCare approved enterprise management system
            provided by Supplier, electronically polling devices attached to
            LANs.

            Ongoing inventory reconciliation via random inventory verifications,
            verification of local inventories when performing Equipment
            installations, etc.

                  Verify inventory information upon request for on-site service

      28.   OPERATIONS DOCUMENTATION:

            SUPPLIER'S SOLUTION DESCRIPTION:

                                      145.
<PAGE>
            Supplier's standard delivery model for operational documentation
      includes maintaining and updating the existing operational documentation
      for all operations procedures and services that are in-scope. In addition,
      where operational documentation does not exist for in-scope services,
      Supplier shall establish and then maintain documentation, with
      PacifiCare's concurrence. During Transition Period, transfer of knowledge
      relating to procedures and policies that are specific to PacifiCare shall
      be merged with current Supplier procedures and then documented for use in
      support of PacifiCare. [...***...].

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            OPERATIONS DOCUMENTATION. Supplier shall develop all new systems
      documentation, and End-User based documentation so as to be accessible by
      soft copy. Supplier shall maintain current documentation in hard and soft
      copy on all operations procedures, services, Equipment and Software for
      which Supplier is responsible. Supplier's responsibilities shall include:

                  During the Transition Period Supplier shall review and update
                  operational procedures with the operations and PacifiCare
                  staff, as appropriate.

                  Document operations procedures and services. All old and new
                  applications operations instructions shall be created or
                  updated.

                  Document application procedures that affect operations.

                  Document End-User procedures that affect operations.

            all documentation for which Supplier is responsible, and subject to
            PacifiCare's review and approval, develop and enforce documentation
            standards. Supplier shall regularly audit documentation for
            completeness and accuracy in order to verify that all documentation
            is present, organized, readable, and updated. The resulting audit
            findings shall be reported to PacifiCare on a regular basis. Where
            it is determined that documentation is inaccurate (e.g., erroneous
            or out of date), Supplier shall correct such documentation. To the
            extent Supplier is otherwise responsible to provide support, advice
            and assistance to End-Users hereunder, Supplier shall do so
            consistent with current documentation. All documentation maintained
            by Supplier shall be subject approval by PacifiCare and shall
            conform to documentation standards agreed upon between PacifiCare
            and Supplier.

      29.   ORDER FULFILLMENT:

            SUPPLIER'S SOLUTION DESCRIPTION:

            [...***...]

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      146.
<PAGE>
            [...***...].

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Supplier shall provide pre-acquisition consulting including
      consulting on compatibility and infrastructure requirements. Supplier
      shall forecast PacifiCare Services processing requirements, process
      End-User requests, configure Equipment, and order (if requested by
      PacifiCare). Supplier shall be responsible for verifying that appropriate
      PacifiCare approvals have been obtained and scheduling installations, and
      PacifiCare Facilities preparation. Supplier shall perform such procurement
      functions in accordance with the following:

            Supplier shall procure in accordance with the Change Control
            Procedures PacifiCare standard (or other configurations as
            PacifiCare may request) Equipment in accordance with the following:

            Catalog Procedures. In order to facilitate PacifiCare's production
            of orders, Supplier shall provide a catalog of the PacifiCare
            Standard Equipment and Software, with current prices, in both an
            electronic and hard copy format.

            Delivery of Orders. PacifiCare shall send its orders for products to
            Supplier in accordance with procedures agreed to by the Parties in
            advance and set forth in Schedule 13.3, Policy and Procedures
            Manual.. Supplier shall not accept or place any order that is not
            pursuant to a PacifiCare Approved Request.

            Order Content. Each order shall be numbered or uniquely identified
            and shall include at least the following items whenever such item is
            applicable to the product items and related Services covered by such
            order: the date of the order; the delivery dates and dates of
            performance of required preparatory services; a complete list of the
            product items covered by the order, specifying, attaching or
            referencing the quantity, model number, name or identification
            number, and description; the charge for each product item; shipping
            instructions; the location to which the products shall be delivered
            and installed; and the scheduled installation date.

            Installation Date(s). Installation dates for servers shall be as
            specified in each order, or, if not specified, as mutually agreed
            upon. Installation dates for PCs shall be as specified in each
            order, or, if not specified, [...***...]. Supplier shall cause the
            Equipment to be delivered to PacifiCare's designated location
            required preparatory services on or before the dates specified.
            PacifiCare shall provide a secure location for the Equipment to
            reside at each designate location. Equipment and Software shall not
            be considered installed until the Equipment or Software operates in
            accordance with its documentation and PacifiCare guidelines.

            Order Terms. Supplier shall immediately acknowledge receipt of each
            order and shall be bound by such order to procure in accordance with
            the Change Control Procedures or Change Management Procedures as
            appropriate the product items and provide related Services provided
            therein, unless Supplier notifies PacifiCare of reasonable
            objections to the requirements of such order in writing within
            [...***...] of the receipt of such order.

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      147.
<PAGE>
            Order Changes. If PacifiCare cancels or withdraws an order for any
            non-Supplier product item after the time that such product is
            shipped to PacifiCare, Supplier may invoice PacifiCare for Out-of
            Pocket costs and reasonably related administrative expenses, as
            disclosed to PacifiCare prior to the cancellation or withdrawal and
            which Supplier cannot reasonably avoid or mitigate.

            Order Tracking. Supplier shall track technology orders, including
            verifying the technical integrity of the order, examining the order
            to verify that it constitutes a properly completed PacifiCare
            Approved Request, processing the order, and following through on
            delivery.

            [...***...]

            Upon order arrival, configure install, and test in scope distributed
            Equipment and Software.

            Maintain master Software diskettes or CDs in a central location.

            Maintain and upgrade in scope network Software i.e., the operating
            system, mail systems, gateway and communication Software.

            Plan installation of computer and environmental Equipment.

            Notify users of new Software availability.

                  Design, configure, install and test all new file servers and
                  Equipment. This includes proper coordination to provide that
                  connectivity is ready, data center or server room space has
                  been coordinated, as well as physical set up of associated
                  Equipment and Software.

      30.   DATA RETENTION

            PACIFICARE'S FUNCTIONAL REQUIREMENT:

            Notwithstanding the standard retention requirements, for any Data
      that shall be retained as required by law, by the order of a court or
      similar judicial or administrative body, pursuant to a settlement
      agreement, finding of a court, arbitrator, or mediator, in preparation for
      or use in a matter relating to litigation or upon the request of
      PacifiCare, upon notification by PacifiCare, Supplier shall retain the
      applicable Data, perform the appropriate Backup of Data and ship the
      relevant media to storage in compliance with the applicable retention
      notice provided by PacifiCare. The process of Backup and storage will be
      pursuant to the normal procedures for such Backup and shipment unless
      otherwise specified by PacifiCare. In the event Supplier's compliance with
      such non standard retention requirement will result in Supplier incurring
      an unreasonable expense or cost, the Parties shall mutually agree on the
      allocation of such expense or cost.

                                              *CONFIDENTIAL TREATMENT REQUESTED
                                      148.
<PAGE>
                                    EXHIBIT C
<PAGE>
                                    EXHIBIT C

                         PACIFICARE INCLUDED AFFILIATES

Antero Health Plans, Inc.
(an Colorado corporation)

FHP Reinsurance Limited
(a Bermuda corporation)

Health Maintenance Life, Inc.
(a Guam corporation)

PacifiCare of Arizona, Inc.
(an Arizona corporation)

PacifiCare Asia Pacific Insurance Brokers, Inc.
(a Guam corporation)

PacifiCare Behavioral Health of California, Inc.
(a Delaware corporation)

PacifiCare Behavioral Health, Inc.
(a Delaware corporation

PacifiCare of California
(a California corporation)

PacifiCare of Colorado, Inc.
(a Colorado corporation)

PacifiCare Dental of Colorado, Inc.
(a Colorado corporation)

PacifiCare Dental
(a California corporation)

PacifiCare eHoldings, Inc.
(a California corporation)

PacifiCare Health Insurance Company of Micronesia, Inc.
(a Guam corporation)

PacifiCare Health Plan Administrators, Inc.
(an Indiana corporation)

PacifiCare Health Systems Foundation
(a California nonprofit corporation)

PacifiCare Health Systems, Inc.
(a Delaware corporation)

                                       1
<PAGE>
PacifiCare International Limited
(an Irish Company)

PacifiCare Life Assurance Company
(a Colorado corporation)

PacifiCare Life and Health Insurance Company
(an Indiana corporation)

PacifiCare Life Insurance Company
(an Arizona corporation)

PacifiCare of Nevada, Inc.
(a Nevada corporation)

PacifiCare of Ohio, Inc.
(an Ohio corporation)

PacifiCare of Oklahoma, Inc.
(an Oklahoma corporation)

PacifiCare of Oregon, Inc.
(an Indiana corporation)

PacifiCare of Texas, Inc.
(an Oregon corporation)

PacifiCare Ventures, Inc.
(a California corporation)

PacifiCare of Washington, Inc.
(a Washington corporation)

RxConnect Acquisition Corporation
(a California corporation)

RxSolutions, Inc.
(a California corporation)

SecureHorizons USA, Inc.
(a California corporation)

SeniorCo, Inc.
(a Delaware corporation)

                                       2
<PAGE>
                               SCHEDULE 3.1(b)(i)

                              AFFECTED CONTRACTORS

For confidentiality purposes, the information in this schedule will only be
accessible to the PacifiCare Supplier Relationship Vice President, the IBM
Account Executive, and other personnel (e.g., Human Resources, Legal, etc.) as
deemed necessary.

[...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                              SCHEDULE 3.1(b)(ii)

                               AFFECTED EMPLOYEES

For confidentiality purposes, the information in this schedule will only be
accessible to the PacifiCare Supplier Relationship Vice President, the IBM
Account Executive, and other personnel (e.g., Human Resources, Legal, etc.) as
deemed necessary.

[...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 3.5

             TECHNICAL ARCHITECTURE AND PRODUCT STANDARDS PROCEDURES
<PAGE>
[PACIFICARE LOGO]

                                 ENTERPRISE-WIDE
                             TECHNICAL ARCHITECTURE
                                       FOR
                            PACIFICARE HEALTH SYSTEMS

                               [PACIFICARE LOGO]

                          DOMAIN ARCHITECTURE DOCUMENT

                                GOVERNANCE DOMAIN

                                  [...***...]

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                                     Page 1
<PAGE>
TABLE OF CONTENTS

<TABLE>
<S>                                                                                 <C>
GOVERNANCE DOMAIN ARCHITECTURE..................................................     3

  About This Document...........................................................     3
  Document History..............................................................     3
  Related Documents.............................................................     3
  Governance Domain Participants................................................     3
  Governance Domain Definition..................................................     5
  Governance Domain Vision......................................................     5
  Governance Domain Executive Summary...........................................     5
  Governance Principles.........................................................     7
  Governance Organizations......................................................     8
    Key Architecture Entities...................................................     9
    Architecture Oversight Bodies...............................................    12
  Governance Processes..........................................................    15
    Management Processes........................................................    16
    Consulting Processes........................................................    23
    Communication Processes.....................................................    25
  Gap Analysis..................................................................    29
  Appendices....................................................................    32
    Appendix 1. Roles and Responsibilities for Enterprise Architecture Processes    32
    Appendix 2. EWTA Domain Ratification and Maintenance Process................    32
    Appendix 3. EWTA Exception Management and Compliance Process................    32
</TABLE>

                                     Page 2

<PAGE>
                         GOVERNANCE DOMAIN ARCHITECTURE

ABOUT THIS DOCUMENT

The Governance Domain details the principles, organizations, roles and
responsibilities, services, processes and the workflow for the PacifiCare Health
Systems (PacifiCare) Enterprise Architecture (EA).

DOCUMENT HISTORY

<TABLE>
<CAPTION>
Version        Date           Team Member               Reason
<S>            <C>            <C>                       <C>
[...***...]    [...***...]    [...***...]               [...***...]
</TABLE>

RELATED DOCUMENTS

<TABLE>
<CAPTION>
Document Title       Relevance         Owner             How to obtain
<S>                  <C>               <C>               <C>
[...***...]          [...***...]       [...***...]       [...***...]
</TABLE>

GOVERNANCE DOMAIN PARTICIPANTS

      DOMAIN TEAM LEADER: [...***...]

      DOMAIN PARTICIPANTS: [...***...]

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      CORE TEAM COORDINATOR: [...***...]

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GOVERNANCE DOMAIN DEFINITION

Te Governance Architecture details the overall governance process for
PacifiCare's Enterprise Architecture (EA), including the various oversight
committees and their roles/responsibilities. Governance is the framework for
defining who is responsible for what and how decisions are made related to the
evolution of PacifiCare's Enterprise-Wide Technical Architecture (EWTA). It is
also the mechanism for ensuring compliance with the principles set forth in the
conceptual architecture and various domain architectures.

The terms EWTA and EA are utilized extensively throughout this document. EWTA
refers to the principles, standards and technology elements that make up
PacifiCare's architecture, i.e., "the What". EA refers to the governance of the
processes, touchpoints, and organizations that determine how the architecture
operates at PacifiCare, i.e., "the Who, What, Where and When."

GOVERNANCE DOMAIN VISION

PacifiCare facilitates the evolution of its technology infrastructure via
proactive and unified governance of the EWTA by all stakeholders. The conceptual
and domain design principles, which make up the EWTA, are the primary criteria
for decisions related to evolution of the EWTA and will be employed by all
stakeholders.

GOVERNANCE DOMAIN EXECUTIVE SUMMARY

EA Governance consists of four key elements: the EWTA, governance principles,
organizations and processes that must be established and maintained to insure
effective and sustainable governance and evolution of the ETWA. The following
describes each of these key EA Governance elements:

   -  EWTA - Consists of the Common Requirements Vision (CRV), Conceptual
      Architecture principles (CA), Domain Architecture design principles,
      standards, products, design patterns and technology roadmaps that guide
      PacifiCare's IT investments. [...***...]

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[...***...]

   -  GOVERNANCE PRINCIPLES - Guiding principles for governance of the evolution
      of PacifiCare's EA. The principles provide a context for consistent
      architecture and program management decision-making.

   -  ORGANIZATION - The organizations that make up PacifiCare's EA function,
      their roles and responsibilities and the services they provide.

   -  PROCESSES - The processes and workflow for the services that make up EA at
      PacifiCare. These include strategy, EWTA maintenance, EWTA compliance,
      administration, project architecture, communications, knowledge
      management, and training processes.

Figure 1 graphically depicts the elements EA Governance:

                             FIGURE 1. EA GOVERNANCE

                           [GRAPHIC OF EA GOVERNANCE]

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GOVERNANCE PRINCIPLES

The following governance principles will guide the establishment and evolution
of PacifiCare's EA governance process:

      1. UNIFIED. [...***...]

      2. INCLUSIVE. [...***...]

      3. COMPREHENSIVE. [...***...]

      4. EVOLUTIONARY. [...***...]

      5. COLLABORATIVE. [...***...]

      6. ACCESSIBLE. [...***...]

      7. EFFICIENT. [...***...]

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GOVERNANCE ORGANIZATIONS
(ARCHITECTURE ORGANIZATIONS, ROLES AND RESPONSIBILITIES)

There are a number of entities that are critical to the management of the
PacifiCare EA. In addition there is a hierarchy of architecture oversight bodies
responsible for the maintenance of and compliance to the EWTA. These are
depicted and described below:

[...***...]

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[...***...]

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[...***...]

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[...***...]

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[...***...]

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[...***...]

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[...***...]

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GOVERNANCE PROCESSES
(ARCHITECTURE PROCESSES AND WORKFLOW)

There are eight EA core processes. [...***...]

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MANAGEMENT PROCESSES

Management processes define, develop, evolve and manage the EA for the
enterprise.

   -  STRATEGY - As business direction and IT strategy of PacifiCare evolve, the
      IT Executive and EA Teams work to ensure that the vision and strategic
      intent of EA evolve to meet these changing business needs.

[...***...]

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   -  ADMINISTRATION - Administration encompasses the day-to-day EA governance
      activities performed by the EA Team to ensure effective operation of the
      EWTA at PacifiCare.

[...***...]

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[...***...]

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   -  MAINTENANCE - The ARB governs evolution of the EWTA to ensure that it is
      responsive to changes in PacifiCare's business environment and the
      technology market. The ARB authorizes the EA Team to update the EWTA to
      continually align PacifiCare's technology standards and products with the
      goals and objectives of the business and the changing technology
      marketplace. Appendix 2. EWTA Domain Ratification and Maintenance Process
      flowcharts the EWTA Maintenance process and responsibilities.

[...***...]

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[...***...]

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   -  COMPLIANCE - Compliance is crucial to the long-term success of the EA
      because it details the means by which the EWTA technology standards and
      products will be adhered to throughout the enterprise.

[...***...]

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[...***...]

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CONSULTING PROCESSES

Consulting processes support the application and utilization of the EWTA
standards and EA methodology throughout the enterprise.

   -  PROJECT ARCHITECTURE - The EA Team provides support to Project Architects
      on large Technology and Application Software projects to assist them with
      their architecture needs. The Project Architect position is both strategic
      and tactical in nature. From the strategic perspective, the Project
      Architect provides alignment with the EWTA and overall architectural
      leadership and vision for the project team. From the tactical perspective,
      the Project Architect must transform conceptual architectural vision into
      concrete deliverables used by the project, program, development,
      infrastructure, logistics, and business teams.

[...***...]

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TRAINING - The EA Team establishes an architecture training framework to align
training offerings with architectural principles and standards and promote
overall architecture education within the IT community.

[...***...]

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COMMUNICATION PROCESSES

Communication processes support the means for EA information dissemination and
sharing throughout the enterprise and promote awareness and understanding of the
EA process and guidelines.

   -  KNOWLEDGE MANAGEMENT - The EA Team provides a readily accessible and
      useable EA knowledge base that stores, manages and makes available the
      EWTA principles, standards, methodologies, templates, tools and other
      resources that comprise the EA.

[...***...]

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[...***...]

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   -  COMMUNICATIONS - A consistent, broadly shared and readily available view
      of the EA is critical to building organizational understanding and
      adoption of EA processes within PacifiCare. Promoting a shared
      understanding requires a focused and ongoing communications effort.

[...***...]

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[...***...]

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GAP ANALYSIS

The Gap Analysis provides a description of the gaps between current state of EA
Governance and the ideal state as outlined in this document as of September of
2001. [...***...]

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[...***...]

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[...***...]

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APPENDICES

APPENDIX 1. ROLES AND RESPONSIBILITIES FOR ENTERPRISE ARCHITECTURE PROCESSES

[...***...]

APPENDIX 2. EWTA DOMAIN RATIFICATION AND MAINTENANCE PROCESS

[...***...]

APPENDIX 3. EWTA EXCEPTION MANAGEMENT AND COMPLIANCE PROCESS

[...***...]

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                                   APPENDIX 1
                   ROLES AND RESPONSIBILITIES FOR ENTERPRISE
                             ARCHITECTURE PROCESSES

[...***...]

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                                   APPENDIX 2

                EWTA DOMAIN RATIFICATION AND MAINTENANCE PROCESS

[...***...]

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                                   APPENDIX 3
                EWTA EXCEPTION MANAGEMENT AND COMPLIANCE PROCESS

[...***...]

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                                 SCHEDULE 3.8(a)
<PAGE>
                                                              New York, New York
                                                               December 31, 2001

                                 PROMISSORY NOTE

                  The undersigned, International Business Machines Corporation,
a New York corporation having offices at Route 100, Somers, New York 10589 (the
"Maker"), for value received and in consideration of the execution of a certain
Information Technology Services Agreement, dated December 31, 2001 (the
"Agreement"), between the Maker and Pacificare Health Systems, Inc., a Delaware
corporation with its principal place of business at 3120 West Lake Center Drive,
Santa Anna, California 92704 ("PHS"), promises to provide to PHS credits for the
latter's payment for the services specifically described and delineated in the
Agreement (respectively the "Credits" for the "Services"), commencing with the
payment of the first monthly invoice under the Agreement for Base Services (as
defined in the Agreement), and continuing thereafter for a period of forty two
(42) consecutive months, subject to the conditions precedent set forth below.

                  The provision by the Maker of such Credits for payment for
such Services by PHS is expressly subject to, and conditioned upon the
following: (i) PHS is not in breach of its material obligations under the
Agreement at the time that any such Services are to be provided and (ii) the PHS
monthly fee payment due to Maker under the Agreement for Base Services is timely
made in accordance with Sections 17.2 and 17.7 of the Agreement . Provided that
the foregoing conditions precedent have been fulfilled, Maker will provide such
Credits provided pursuant to this Note and the Agreement in accordance with the
following schedule:

<TABLE>
<S>                                                               <C>
                      Year One (1):                               [...***...]
                      Year Two (2):                               [...***...]
                      Year Three (3):                             [...***...]
                      First Six (6) months of year Four (4):      [...***...]
</TABLE>

                  The Maker and PHS agree that, to the extent that the Maker and
PHS determine that the actual net book value of the assets purchased pursuant to
Section 3.8 of the Agreement (the "Assets") is less than forty-two million
dollars ($42,000,000.00), then the Credits issuable pursuant to this Note shall
be reduced proportionately by the amount of the difference between forty-two
million dollars ($42,000,000.00) and the actual net book value of the Assets, as
determined by the Maker and PHS. The Maker and PHS will cooperate with one
another and shall use all reasonable efforts to make a final determination as to
such net book value as soon as reasonably practicable following the date hereof.

                  This Note evidences obligations incurred under, and is subject
to, secured by and entitled to the benefits provided by the terms and conditions
of the Agreement, to which Agreement reference is hereby made for a statement of
said terms and provisions. The terms and provisions of the Agreement are
incorporated herein, to the extent applicable.

                  PHS agrees that it will look solely to the Credits for the
payment of this Note, and no other property or assets of the Maker or of any
person, firm or entity, disclosed or undisclosed, shall be subject to any
enforcement procedure for the satisfaction of the remedies of PHS under this
Note.

                  In the event that the Maker fails to provide the Services as
provided in the Agreement, or if the Maker is in default under any other
provision of the Agreement, PHS shall be entitled to those remedies specifically
afforded to it and provided by in the Agreement or at law or in equity.

                  Subject to the next sentence, in the event of the termination
of the Agreement, this Note will be of no further force or effect, and IBM's
obligations under this Note shall be deemed fully satisfied without any further
provision of Credits for Services or otherwise. In the event of the termination
of the Agreement by PHS pursuant to

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
Section 24.3 (a) of the Agreement, any outstanding Credits issuable hereunder
may, at the option of PHS, be used to reduce (i) the aggregate purchase price
for the re-purchase of the Assets from the Maker in accordance with Section 25.2
of the Agreement; and (ii) fees for Termination Assistance Services payable
pursuant to Section 26.2 of the Agreement.

                  Presentment, notice of dishonor, protest and notice of protest
are hereby waived.

                  This Note may not be changed or terminated orally and no
waiver of any provision hereof shall be valid unless in writing signed by the
Maker and PHS.

                                             INTERNATIONAL BUSINESS MACHINES
                                             CORPORATION

                                             By:______________________________

                                                     Title:
<PAGE>
                                 SCHEDULE 3.8(b)
<PAGE>
                                 SCHEDULE 3.8(b)

                       GENERAL ASSIGNMENT AND BILL OF SALE

THIS GENERAL ASSIGNMENT AND BILL OF SALE, dated as of December 31, 2001, is
between PACIFICARE HEALTH SYSTEMS, INC., a Delaware corporation with its
principal place of business at 3120 W. Lake Center Drive, Santa Ana, California,
92704 ("SELLER"), and INTERNATIONAL BUSINESS MACHINES CORPORATION, a New York
corporation with its principal place of business at Route 100, Somers, New York
10589 ("PURCHASER").

                                   WITNESSETH:

WHEREAS, Purchaser and Seller are entering into an agreement of even date
herewith whereby Purchaser will provide Seller with various information
technology services (the "Services Agreement"); (capitalized terms not defined
herein shall have the meanings ascribed to them in the Services Agreement);

WHEREAS, pursuant to the Services Agreement, Seller has agreed to sell, and
Purchaser has agreed to purchase, on the Effective Date, the assets described in
Exhibit 1 to this General Assignment and Bill of Sale (the "ASSETS"); and

WHEREAS, Seller desires to transfer and assign the Assets and Purchaser desires
to accept the transfer and assignment thereof.

NOW, THEREFORE, in consideration of the mutual covenants contained herein and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Seller hereby irrevocably sells, transfers, conveys,
and assigns to Purchaser all of Seller's right, title, and interest in the
Assets, free of all liens except Permitted Liens, to have and to hold the same
unto Purchaser, its successors, and assigns, forever.

Purchaser hereby accepts the sale, transfer, conveyance, and assignment of the
Assets.

At any time or from time to time after the date hereof, at Purchaser's request
and without further consideration, Seller shall execute such other instruments
of transfer, conveyance, assignment, and confirmation, provide such materials
and information and take such other actions as Purchaser may reasonably deem
necessary or desirable in order more effectively to transfer, convey, and assign
to Purchaser, and confirm Purchaser's title to, all of the Assets, and to the
full extent permitted by law, to permit Purchaser to exercise all rights with
respect thereto. Seller represents that it owns, and has good and valid title
to, the Assets, and Seller shall indemnify and defend Purchaser from i) all
claims that the Assets infringe upon the intellectual property rights of any
third party, ii) all claims by third parties with respect to Seller's valid
title to the Assets, and iii) and all claims by third parties demanding the
satisfaction of Permitted Liens with respect to the Assets, provided that, in
each case, Purchaser complies with the indemnification procedures set forth in
Section 27.3 of the Agreement.

This General Assignment and Bill of Sale may be executed in any number of
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.

The rights and obligations of the Parties under this General Assignment and Bill
of Sale shall be governed in all respects by the laws of the State of California
exclusively, as such laws apply to

                                       1.
<PAGE>
contracts between California residents performed entirely within California.
Supplier agrees that it shall only bring any action or proceeding arising from
or relating to this Agreement in a federal court in the Central District of
California or in state court in Los Angeles, California, and Supplier
irrevocably submits to the personal jurisdiction and venue of any such court in
any such action or proceeding or in any action or proceeding brought in such
courts by PacifiCare.

IN WITNESS WHEREOF, the undersigned have caused their duly authorized officers
to execute this General Assignment and Bill of Sale on the date first written
above.

PACIFICARE HEALTH SYSTEMS, INC.         INTERNATIONAL BUSINESS MACHINES
                                        CORPORATION

By:                                     By:
   --------------------------------        -------------------------------------
         [NAME]                               [NAME]

Title:                                  Title:
      -----------------------------           ----------------------------------

                                       2.
<PAGE>
                EXHIBIT 1 TO GENERAL ASSIGNMENT AND BILL OF SALE

The "Assets" are the information-technology-related assets used in connection
with Seller's provision of internal information technology services prior to the
Effective Date, which assets Purchaser will use to provide Services pursuant to
the Services Agreement, as such assets are contemplated by the RFP issued by
Seller in connection with the transactions contemplated by the Services
Agreement and as described in materials previously provided by Seller to
Purchaser.

                                       3.
<PAGE>
                                 SCHEDULE 3.9(b)
<PAGE>
PacifiCare / IBM Confidential

                                 SCHEDULE 3.9(b)

                                     REPORTS

Without limiting or altering Supplier's responsibility to provide any reports,
updates, invoices or similar documentation to PacifiCare as set forth in the
Agreement or any exhibit, schedule or attachment thereto, and without limiting
any of Supplier's other responsibilities as set forth in the Agreement or any
exhibit, schedule or attachment thereto, Supplier shall provide PacifiCare the
reports set forth in this Schedule 3.9(b) (the "REPORTS") in accordance with the
terms of this Schedule 3.9(b) and Appendix 1 hereto.

Supplier shall not change or discontinue producing any Report without the
approval of PacifiCare.

Supplier shall work with PacifiCare to determine the best means and formats by
which to provide Reports, including options such as Web access, online graphical
reports, and file transfer. For any Reports not set forth herein or otherwise
described in the Agreement or any exhibit, schedule or attachment thereto,
PacifiCare and Supplier shall mutually determine the content, format and
frequency of such Reports.

All Reports and all contents thereof shall be PacifiCare Data.

1. PRODUCTION REPORTS. Supplier shall produce all reports [...***...]
(individually and collectively, "PRODUCTION REPORTS") anD deliver such
Production Reports to [...***...].

2. OPERATIONAL REPORTS.

Supplier shall produce operational reports for PacifiCare that describe the
operations and Services performed by Supplier ("OPERATIONAL REPORTS"). The
Operational Reports shall include:

         (a) SECURITY BREACH REPORT. As set forth in Section 10.4 of the
Agreement, Supplier shall deliver to PacifiCare Reports of all security breaches
and potential breaches discovered by or made known to Supplier. Supplier shall
deliver such Reports regarding security breaches and potential breaches
immediately following such breach or the discovery of such breach or potential
breach by Supplier.

         (b) ANNUAL SECURITY AUDIT. As set forth in Section 10.2 of the
Agreement, Supplier shall provide PacifiCare a Report of each annual security
audit performed by Supplier promptly following the completion of such security
audit.

         (c) DISASTER RECOVERY TEST SUMMARY. As set forth in Section 16.1 and
elsewhere, Supplier shall provide PacifiCare Reports of disaster recovery test
and retest results as required pursuant to Section 16.1 of the Agreement and as
otherwise conducted by Supplier, which such Reports shall be delivered promptly
following any such disaster recover test or retest ("DISASTER RECOVERY TEST
SUMMARY REPORTS").

         (d) VARIABLE FEES REPORT AND RELATED REPORTS. During the Term and
Termination Assistance Period Supplier shall provide PacifiCare a monthly
Variable Fees Report as set forth in Section 17.4 of the Agreement.

         (e) [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                  Page 1 of 8
<PAGE>
[...***...]

         (f) [...***...].

3. SERVICE LEVEL REPORTS. Supplier shall provide PacifiCare a monthly Service
Level Report (as defined in Schedule 8 to the Agreement), as set forth in
Section I.G.1 of Schedule 8 to the Agreement ("SERVICE LEVEL REPORTS").
[...***...].

4. SERVICE LEVEL MANAGEMENT REPORTS.

         [...***...].

5. PROBLEM MANAGEMENT REPORTS. Supplier shall produce a monthly Report
containing number and types of problems [...***...].

6. CHANGE MANAGEMENT REPORTS. Supplier shall produce a monthly Report detailing
all changes, modifications, updates, revisions and other functions relevant to
Change Management Process (as defined in the Policy & Procedures Manual),
[...***...].

7. BILLING RESOLUTION REPORTS. As requested by PacifiCare, Supplier shall
provide to PacifiCare Reports that shall provide detailed summaries of issues
with respect to billing [...***...].

8. PROJECT MANAGEMENT REPORTS. Supplier shall provide Reports regarding the
status of all current and planned Projects as set forth in Section H.21 of
Exhibit B to the Agreement ("PROJECT STATUS REPORTS").

9. IMAC REPORTS. On a monthly basis, Supplier shall provide PacifiCare a Report
that shall detail IMAC (as defined in EXHIBIT B) activity during the preceding
month ("IMAC STATUS REPORTS"). [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                  Page 2 of 8
<PAGE>
[...***...]

10. ASSET MANAGEMENT REPORTS. Beginning ninety (90) days after the Effective
Date Supplier completes the inventory pursuant to Section 3.8 of the Agreement,
Supplier shall calculate statistics and publish Reports quarterly on all
physical assets (including the Assets as set forth in Schedule 3.8 to the
Agreement) leased, managed, purchased, or otherwise used by Supplier to perform
the Services, including all Equipment and New Equipment acquired by or for
Supplier or PacifiCare pursuant to the Agreement, which such Reports shall
include a current list of all Service Locations and identify what assets are
located or used at each Service Location ("ASSET MANAGEMENT REPORTS").

11. CUSTOMER SATISFACTION REPORTS. Supplier shall provide PacifiCare a monthly
Report with respect to the customer satisfaction surveys, results and other
related functions as set forth in Exhibit B ("CUSTOMER SATISFACTION AND
INITIATIVE Reports").

12. TRANSITION REPORTS.

         (a) TECHNICAL TRANSITION PLAN UPDATE. On the last day of each month
during the Transition Period, Supplier shall provide PacifiCare with an updated
hard copy Gantt chart detailing the current status of all technical transition
tasks ("TECHNICAL TRANSITION PLAN UPDATE").

         (b) TRANSITION STATUS REPORT. On the last day of each month during the
Transition Period, Supplier shall provide PacifiCare with a written Report
detailing Supplier's status with respect to the Transition Services and
Transition Plan ("TRANSITION STATUS REPORTS"), which shall include the
following:

                  (i) STATUS SUMMARY - Each Transition Status Report shall
include an executive-level summary of transition progress to-date, including an
updated summary with respect to the Transition Plan and relevant accomplishments
and failures of Supplier with respect thereto.

                  (ii) CRITICAL MILESTONE STATUS - Each Transition Status Report
shall include a listing of all Critical Milestones as set forth in Section 4.2
of the Agreement, along with: estimated time to completion of such Critical
Milestones, days that each Critical Milestone is overdue, anticipated completion
date for each Critical Milestone and related comments.

                  (iii) CRITICAL ISSUES LIST - Each Transition Status Report
shall include a listing of all unresolved issues related to the Transition Plan
and Transition Services, including those for which PacifiCare has primary
responsibility, including due dates, priority lists, identification of the
responsible Party for tasks and projects related to the Transition Plan,
potential and actual business and Transition Plan execution impact assessment.

13. SYSTEM MONITORING/CAPACITY PLANNING REPORTS. The Supplier shall produce a
monthly Report that provides computer resources system monitoring information,
to facilitate the PacifiCare capacity planning and risk management process
("SYSTEM MONITORING/CAPACITY PLANNING REPORTS"), which such Reports shall
include the following Reports in support of the purposes set forth below:

                  [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                  Page 3 of 8
<PAGE>
[...***...]

14. CAPACITY AND PERFORMANCE REPORT. In conjunction with Keane, Supplier shall
publish a monthly capacity and performance report[...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                  Page 4 of 8
<PAGE>
[...***...]

15. AD HOC REPORTS. Supplier shall produce other reports requested by PacifiCare
("AD HOC REPORTS") as set forth in Exhibit B to the Agreement.

16. SECURITY REPORTS. Supplier shall produce monthly reports for PacifiCare that
describe various functions that impact on security ("SECURITY REPORTS").
[...***...]

[...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                  Page 5 of 8
<PAGE>

[...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                  Page 6 of 8
<PAGE>
                          APPENDIX 1 TO SCHEDULE 3.9(b)

The following is a summary of the Reports described in Schedule 3.9(b), the
frequency and timing of such Reports and the date Supplier shall begin to
deliver such Reports to PacifiCare. Unless otherwise indicated, (1) any Report
that is described as "Monthly" shall be due within five (5) days of the
beginning of each month of the Term and shall address the appropriate
information for the immediately preceding month, (2) any Report that is
described as [...***...] (3) any Report that is described as "Weekly" shaLl be
due on the Monday immediately following the week for which such Report is
provided.

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------
NO.       REPORT TITLE                           FREQUENCY AND TIMING        COMMENCEMENT DATE FOR REPORTING
------------------------------------------------------------------------------------------------------------
<S>       <C>                                    <C>                         <C>
1.        Production Reports                     [...***...]                 Effective Date
------------------------------------------------------------------------------------------------------------
2.        Operational Reports                    [...***...]                 As noted below or as otherwise
                                                                             agreed by the Parties
------------------------------------------------------------------------------------------------------------
2(a)      Security Breach Report                 [...***...]                 Cutover Date
------------------------------------------------------------------------------------------------------------
2(b)      Annual Security Audit                  [...***...]                 Cutover Date
------------------------------------------------------------------------------------------------------------
2(c)      Disaster Recovery Test Summary         [...***...]                 Cutover Date
          Reports
------------------------------------------------------------------------------------------------------------
2(d)      Variable Fees Report and               [...***...]                 Cutover Date
          Related Reports
------------------------------------------------------------------------------------------------------------
2(e)      [...***...]                            [...***...]                 [...***...]
------------------------------------------------------------------------------------------------------------
2(f)      [...***...]                            [...***...]                 [...***...]
------------------------------------------------------------------------------------------------------------
3.        Service Level Reports                  [...***...]                 As provided Schedule 8
------------------------------------------------------------------------------------------------------------
4.        Service Level Management Reports       [...***...]                 As noted below
------------------------------------------------------------------------------------------------------------
4(a)      Annual Earnback Report                 [...***...]                 Cutover Date
------------------------------------------------------------------------------------------------------------
</TABLE>

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
<TABLE>
<S>       <C>                                    <C>                         <C>
------------------------------------------------------------------------------------------------------------
4(b)      Annual Automatic Adjustment            [...***...]                 Cutover Date
          Report
------------------------------------------------------------------------------------------------------------
5.        Problem Management Reports             [...***...]                 Cutover Date
------------------------------------------------------------------------------------------------------------
6.        Change Management Reports              [...***...]                 Cutover Date
------------------------------------------------------------------------------------------------------------
7.        Billing Resolution Report              [...***...]                 Effective Date
------------------------------------------------------------------------------------------------------------
8.        Project Management Reports             [...***...]                 Cutover Date
------------------------------------------------------------------------------------------------------------
9.        IMAC Reports                           [...***...]                 Cutover Date
------------------------------------------------------------------------------------------------------------
10.       Asset Management Reports               [...***...]                 Cutover Date
------------------------------------------------------------------------------------------------------------
11.       Customer Satisfaction and              [...***...]                 Cutover Date
          Initiative Reports
------------------------------------------------------------------------------------------------------------
12.       Transition Reports                     [...***...]                 Effective Date
------------------------------------------------------------------------------------------------------------
12(a)     Technical Transition Plan Update       [...***...]                 Effective Date
------------------------------------------------------------------------------------------------------------
12(b)     Transition Status Report               [...***...]                 Effective Date
------------------------------------------------------------------------------------------------------------
13.       System Monitoring/ Capacity            [...***...]                 Cutover Date
          Planning Reports
------------------------------------------------------------------------------------------------------------
14.       Capacity and Performance Report        [...***...]                 Cutover Date
------------------------------------------------------------------------------------------------------------
15.       Ad Hoc Reports                         [...***...]                 Effective Date
------------------------------------------------------------------------------------------------------------
16.       Security Reports                       [...***...]                 Effective Date
------------------------------------------------------------------------------------------------------------
</TABLE>

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 4.1

                                   PACIFICARE
                            DRAFT TRANSITION SCHEDULE

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------------------
 ID      WBS            Task Name                   Owner      Assisting    Duration        Start         Finish     Predecessors
---------------------------------------------------------------------------------------------------------------------------------
<S>      <C>            <C>                       <C>          <C>         <C>          <C>          <C>           <C>
   1     1              PacifiCare Integrated     IBM/Keane       PHS      [...***...]   [...***...]   [...***...]   [...***...]
                        Transition Schedule
---------------------------------------------------------------------------------------------------------------------------------
         [...***...]    [...***...]               [...***...]   [...***...][...***...]   [...***...]   [...***...]   [...***...]
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 4.2

                         CRITICAL TRANSITION MILESTONES

Solely for the purposes of Section 4.2 of the Agreement, the following
milestones constitute the Critical Transition Milestones and the specific
allowable cure period associated with each such milestone:

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------
NO.     CRITICAL MILESTONE           COMPLETION DATE --    CURE PERIOD    COMPLETION CRITERIA
                                     NO LATER THAN THE
                                     IDENTIFIED DATE*
---------------------------------------------------------------------------------------------
<S>     <C>                          <C>                   <C>            <C>
1.      Hire All Affected            [...***...]           [...***...]      [...***...]
        Employees
---------------------------------------------------------------------------------------------
2.      Migration of NOC to an       [...***...]           [...***...]      [...***...]
        IBM facility
---------------------------------------------------------------------------------------------
3.      Migration of Help Desk       [...***...]           [...***...]      [...***...]
        to an IBM facility
---------------------------------------------------------------------------------------------
4.      Migration of the Data        [...***...]           [...***...]      [...***...]
        Center to an IBM
        facility
---------------------------------------------------------------------------------------------
</TABLE>

*Completion dates are subject to any changes in the detailed Transition Plan
which are mutually agreed by the Parties.

Limitations.  [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                 SCHEDULE 6.3(a)
<PAGE>
                                 SCHEDULE 6.3(a)

              FACILITIES SPACE REQUIREMENTS AND RULES & REGULATIONS

A. INTRODUCTION

This Schedule defines the use of PacifiCare Service Locations by Supplier in
order to provide Services as well as the Rules and Regulations that must be
followed for use of the facilities.

B. FACILITIES PLAN

Initial space requirements will include space that is currently being used by
the "in-scope" personnel as of the Effective Date. Within [...***...] of
Transition start, Steady State facilities plans and space requirements will be
documented.

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------------
ITEM #            PACIFICARE       SUPPLIER                    SPACE REQUIREMENTS                    SERVICE(S)      DATES REQUIRED
                 BUILDING AND      PERSONNEL                                                         PROVIDED
                   ADDRESS                          OFFICES        CUBICLES        WAR ROOM/
                                                                                  CONFERENCE
                                                                                     ROOM
-----------------------------------------------------------------------------------------------------------------------------------
<S>              <C>              <C>             <C>             <C>             <C>               <C>             <C>
[...***...]      [...***...]      [...***...]     [...***...]     [...***...]     [...***...]       [...***...]       [...***...]
-----------------------------------------------------------------------------------------------------------------------------------
[...***...]      [...***...]      [...***...]     [...***...]     [...***...]                       [...***...]       [...***...]
-----------------------------------------------------------------------------------------------------------------------------------
[...***...]      [...***...]      [...***...]     [...***...]     [...***...]                       [...***...]       [...***...]
-----------------------------------------------------------------------------------------------------------------------------------
[...***...]      [...***...]      [...***...]     [...***...]     [...***...]     [...***...]       [...***...]       [...***...]
-----------------------------------------------------------------------------------------------------------------------------------
[...***...]      [...***...]      [...***...]     [...***...]     [...***...]     [...***...]       [...***...]       [...***...]
-----------------------------------------------------------------------------------------------------------------------------------
[...***...]      [...***...]      [...***...]     [...***...]     [...***...]     [...***...]       [...***...]       [...***...]
-----------------------------------------------------------------------------------------------------------------------------------
[...***...]      [...***...]      [...***...]     [...***...]     [...***...]     [...***...]       [...***...]       [...***...]
-----------------------------------------------------------------------------------------------------------------------------------
[...***...]      [...***...]      [...***...]     [...***...]     [...***...]     [...***...]       [...***...]       [...***...]
-----------------------------------------------------------------------------------------------------------------------------------
[...***...]      [...***...]      [...***...]     [...***...]     [...***...]     [...***...]       [...***...]       [...***...]
-----------------------------------------------------------------------------------------------------------------------------------
[...***...]      [...***...]                      [...***...]     [...***...]     [...***...]       [...***...]       [...***...]
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
C. RULES, REGULATIONS AND RESTRICTIONS AT PACIFICARE SERVICE LOCATIONS

         Supplier agrees to comply with all of the rules, regulations and
restrictions set forth below, and with any reasonable amendments or additions
thereto as PacifiCare or its landlord may deem necessary from time to time in
accordance with Section 6.4 of the Agreement.

         (1) Except in emergency situations, supplier shall refrain from
contacting any landlord of PacifiCare for any reason or purpose whatsoever.
Whenever any matter provided for herein requires that any such landlord be
contacted for approval, consent, or otherwise, Supplier shall so advise
PacifiCare and PacifiCare will contact the landlord.

         (2) Except in emergency situations, supplier shall refrain from going
onto the roof of any building or building complex in which a PacifiCare Service
Location is situated for any purpose without first having obtained the prior
written consent of PacifiCare and its landlord.

         (3) General office hours and the business hours of operation in
relation to truck dock activity shall be limited to 7:00 a.m. to 9:00 p.m.
daily.

         (4) Each of the Supplier's employees and other personnel shall at all
times while at any PacifiCare Service Location wear and display a standard
identification badge issued to them in a manner that allows easy identification
of the employee or personnel. PacifiCare may deny an employee or other Supplier
personnel access to any PacifiCare Service Location if current and proper
identification is not presented and worn while entering and working at any
PacifiCare Service Location.

         (5) Any and all loading and unloading of goods shall be done only at
such times, in the areas and through the entrances designated for such purpose
by PacifiCare or its landlord.

         (6) Supplier shall not, without first having obtained PacifiCare's and
its landlord's prior written consent, make any structural or non-structural
interior or exterior alterations, additions, improvements or utility
installations (including without limitation, alterations to the plumbing,
electrical and other building systems, the boring, cutting or stringing of
wires, the laying of linoleum or other floor coverings, the attachment to or
suspension from floors, walls or ceilings of curtains, blinds, shades,
sunscreens, planters, television sets, telephones, call boxes and other office
equipment,) in, on or about any PacifiCare Service Location.

         (7) Supplier shall (a) promptly pay for all costs of alterations or
other work done or permitted to be done by it or caused by it to be done on or
about any PacifiCare Service Location unless otherwise agreed; (b) keep each
PacifiCare Service Location free and clear of any liens arising out of any such
alterations or work; and (c) in the event any lien is filed against any
PacifiCare Service Location in connection with any alterations or other work
done, permitted or caused to be done by Supplier, Supplier shall, at its sole
cost and expense, obtain a release bond in the statutorily required amount and
issued by a surety approved by PacifiCare and its landlord, immediately after
written request to do so from PacifiCare.

         (8) Any and all garbage, trash and refuse shall be kept in the type of
container specified by PacifiCare's landlord, and shall be placed in the
designated trash enclosures for collection. Supplier shall not burn any trash or
garbage of any kind in or about the building or building complex housing any
PacifiCare Service Location.

         (9) No satellite dish, antenna or other telecommunications equipment
shall be erected in or outside of any PacifiCare Service Location, without in
each instance the written consent of PacifiCare and
<PAGE>

its landlord. Any such equipment so installed without such written consent shall
be subject to removal without notice at any time by PacifiCare or its landlord,
at the sole cost of Supplier. In the event any such equipment, installed by or
at the request of Supplier within any PacifiCare Service Location or elsewhere
within the building which houses a PacifiCare Service Location causes
interference with or to equipment used by PacifiCare or another tenant within
said building, Supplier shall assume and pay or discharge all liability arising
from or related to such interference and shall take all necessary actions to
eliminate such interference.

        (10) Supplier shall not make or permit to be made any unseemly or
disturbing noises, sounds or vibrations or disturb or interfere with occupants
of the building housing any PacifiCare Service Location or any building complex
which includes such building (collectively, the "Development") by the use of any
musical instrument, radio, phonograph, unusual noise, or in any other way. No
loudspeakers, televisions, phonographs, radios or other devices shall be used in
a manner so as to be heard or seen outside of the PacifiCare Service Location
without the prior written consent of PacifiCare and its landlord. Supplier shall
conduct its business in a quiet and orderly manner so as not to create
unreasonable or unrelated noise.

         (11) Supplier shall not solicit business within the Development by
circulars or otherwise, or take any action which would interfere with the rights
of other persons to use such facilities without the written consent of Landlord,
and shall cooperate with PacifiCare and its landlord to prevent same.

         (12) Supplier shall not place or permit any obstruction in the common
areas immediately adjoining any building housing a PacifiCare Service Location
without the written consent of PacifiCare and its landlord. Supplier shall not
display or sell merchandise, or allow carts, portable signs, signed vehicles,
devices or other objects to be stored or to remain outside of any building
housing a PacifiCare Service Location without the written consent of PacifiCare
and its landlord.

         (13) Supplier and its employees shall be required to park their
vehicles in an area designated by PacifiCare and its landlord for such parking.
Supplier shall not permit any parking by its employees, agents, subtenants,
customers, invitees, concessionaires or visitors on the streets surrounding such
building in violation of any ordinances or postings of any public authorities
having jurisdiction.

         (14) Supplier shall not cause or permit the existence of any obnoxious
or foul odors that disturb the public or other tenants. Should such odors be
evident, Supplier shall be required to take immediate steps to remedy same at
Supplier's expense.

         (15) Supplier shall not obstruct the sidewalks, entrances, passages,
corridors or halls, nor use same for any purpose other than ingress and egress.
The halls, passages, entrances and roof are not for the use of the general
public, and PacifiCare and its landlord shall in all cases retain the right to
control and prevent access thereto by all persons whose presence in the judgment
of PacifiCare or its landlord shall be prejudicial to the safety, character,
reputation or interests of the Development and its tenants, provided that
nothing contained herein shall be construed to prevent such access by persons
with whom the Supplier normally deals in the ordinary course of its business
unless such persons are engaged in illegal activities.

         (16) PacifiCare and its landlord shall have the right to determine and
prescribe the weight and proper position of any unusually heavy equipment,
including, but not limited to, equipment, libraries, safes, large files, and the
like that are to be placed in a PacifiCare Service Location, and only those
which in the opinion of PacifiCare or its landlord will not do damage to the
floors, structure and/or elevators may be moved into a PacifiCare Service
Location. Any damage occasioned in connection with the moving or installing of
such aforementioned articles in a PacifiCare Service Location or the existence
of same therein shall be paid for by Supplier.
<PAGE>
         (17) Any telephone mainline and all cabling and gas lines shall be run
only with the prior written approval of PacifiCare and its landlord, and only in
accordance with detailed plans which have been submitted to and approved by
PacifiCare and its landlord.

         (18) The plumbing facilities installed in any PacifiCare Service
Location shall be used only for the purpose for which they were constructed. No
foreign substance shall be deposited in any toilet or sink, and the cost of
repair from any breakage, stoppage or damage resulting therefrom shall be borne
by Supplier.

         (19) Supplier shall not overload the electrical circuit breaker panels.

         (20) When cleaning the glass windows and/or aluminum framing, Supplier
must use only mild soap and water and apply with a sponge. No abrasive materials
shall be used. If the window frames are aluminum, ammonia must not be used to
clean the windows.

         (21) No signs, advertisements or notices shall be exhibited, painted or
affixed by Supplier to any PacifiCare Service Center so as to be seen from the
outside of such location without the prior written consent of PacifiCare and its
landlord. In the event Supplier violates the foregoing, PacifiCare and its
landlord may remove same without any liability and may charge Supplier for the
cost of such removal.

         (22) Supplier shall not mark, paint, drill into, or in any way deface
any part of any PacifiCare Service Location or the rest of the Development.

         (23) The PacifiCare Service Locations shall not be used for
manufacturing or for storage of merchandise except as such storage may be
incidental to the use of such locations for those uses contemplated by the
Agreement. Supplier shall not occupy or permit any portion of any PacifiCare
Service Location to be occupied for the manufacture of any illegal substance.
The PacifiCare Service Locations shall not be used for any illegal purposes.

         (24) PacifiCare and its landlord shall have the right to prohibit any
advertising by Supplier which, in PacifiCare or its landlord's opinion, tends to
impair the reputation of any Development, and upon written notice from
PacifiCare or its landlord, Supplier shall refrain from or discontinue such
advertising.

         (25) Canvassing, soliciting and peddling in any Development are
prohibited and Supplier shall cooperate to prevent same.

         (26) All parking ramps and areas, pedestrian walkways, plazas and other
public areas forming a part of any Development shall be under the sole and
absolute control of PacifiCare's Landlord, who has the exclusive right to
regulate and control these areas.

         (27) Suppler shall not place anything or allow anything to be placed
near the glass of any window, door, partition or wall which may appear unsightly
from outside the PacifiCare Service Locations, nor shall Supplier sunscreen any
window without the prior written consent of PacifiCare and its landlord.

         (28) Suppler shall not alter any lock or install any new or additional
locks or bolts on any doors or windows of the PacifiCare Service Locations
without the written consent of PacifiCare and its landlord; provided that in the
event such consent is given, Supplier shall provide PacifiCare with keys to such
locks or bolts.

         (29) Supplier shall see that the windows and doors of the PacifiCare
Service Locations are closed and securely locked, that all water faucets and
other apparatus are entirely shut off, and that, when feasible, all lights and
electrical equipment are entirely shut off before leaving, so as to prevent
waste or damage.
<PAGE>
         (30) Supplier shall exercise due care to protect the PacifiCare Service
Locations from theft, robbery or pilferage.

         (31) Supplier shall not place any live load exceeding fifty (50) pounds
per square foot on the floor of any PacifiCare Service Location.

         (32) No animals (except for service animals for persons with
disabilities) or birds may be brought or kept in or about any PacifiCare Service
Location or any building housing a PacifiCare Service Location.

         (33) Supplier shall not use or keep in any PacifiCare Service Location
or any building housing a PacifiCare Service Location any kerosene, gasoline or
other flammable or combustible fluid or material, or use any method of heating
or air conditioning other than that supplied by PacifiCare or its landlord,
except in such quantities and in such containers as are commonly found in
offices and are in compliance with all applicable governmental laws, statutes,
rules, regulations, ordinances and life, safety and fire codes.

         (34) No commercial cooking for sale to the public shall be done or
permitted in any PacifiCare Service Location; nor shall any PacifiCare Service
Location be used for the storage of merchandise, for washing clothes or for
lodging.

         (35) PacifiCare and its landlord shall have the right to exclude or
expel from any PacifiCare Service Location and the building housing any
PacifiCare Service Location any person who, in the judgment of PacifiCare or its
landlord, is intoxicated or under the influence of liquor or drugs, or who shall
in any manner do any act in violation of any of the rules or regulations of the
building housing a PacifiCare Service Location.

         (36) No vending machine or machines of a similar type shall be
installed, maintained or operated at any PacifiCare Service Location without the
prior written consent of PacifiCare and its landlord, provided that any such
consent may be conditioned on Supplier's written undertaking and agreement to
indemnify, defend and hold PacifiCare and its landlord harmless from and against
any and all liability arising out of or resulting from the acts or omissions of
persons supplying goods or services in connection therewith.

         (37) PacifiCare or its landlord shall have the right to control and
operate the public portions of the building housing any PacifiCare Service
Location, any the public facilities, and heating and air conditioning, as well
as any facilities furnished for the common use of all tenants, in such manner as
it deems best for the benefit of such tenants.

         (38) All entrance doors in a PacifiCare Service Location shall be left
locked when such PacifiCare Service Location is not in use, and all doors
opening to public corridors shall be kept closed except for normal ingress and
egress thereto and therefrom.

         (39) Supplier shall, upon termination of its possession of any
PacifiCare Service Location, surrender all keys thereto to PacifiCare and shall
make known to PacifiCare the combination of all combination locks and safes,
cabinets and vaults in such PacifiCare Service Location.

         (40) Supplier shall not employ any person for the purpose of cleaning
or taking care of such location without the written consent of PacifiCare and
its landlord. The janitor of the building housing the PacifiCare Service
Location may at all times keep a pass key, and such janitor or other agents of
PacifiCare and its landlord shall at all times be allowed admittance to said
location.
<PAGE>
         (41) Bicycles and other vehicles shall not be permitted in the offices,
halls, corridors and elevators in the building housing any PacifiCare Service
Location, nor shall any obstruction of sidewalks or entrances of such building
by such vehicles be permitted.

         (42) All right, title and interest in and to any alternations made by
Supplier to any PacifiCare Service Location shall belong to PacifiCare or its
landlord, free and clear of any claim or interest of Supplier.

         (43) Supplier shall not continue to occupy or conduct business in any
PacifiCare Service Location beyond the expiration or termination of the lease
under which PacifiCare holds such PacifiCare Service Location.

         (44) Supplier shall not use any PacifiCare Service Location for any
purpose or activity which has not been specifically provided for or authorized
under the Agreement or these Rules and Regulations.

         (45) Supplier shall not cause or permit any hazardous materials to be
brought upon, kept or used in or about any PacifiCare Service Location.

         (46) To prevent the generation, growth, or deposit of any mold, mildew,
bacillus, virus, pollen or other micro-organisms (collectively, "Biologicals")
and the deposit, release or circulation of any indoor contaminants, including
emissions from paint, carpet and drapery treatments, cleaning, maintenance and
construction materials and supplies, pesticides, pressed wood products,
insulation, and other materials and products (collectively with Biologicals,
"Contaminants"), that could adversely affect the health, safety or welfare of
any tenant, employee or other occupant of the Building or their invitees,
Supplier shall, at Supplier's sole cost and expense, at all times (i) operate
the Premises in a manner consistent with preventing or minimizing the
generation, growth, circulation, release or deposit of any Contaminants, and
(ii) maintain, operate and repair each PacifiCare Service Location in such a
manner to prevent or minimize the accumulation of stagnant water and moisture in
planters, kitchen appliances and vessels, carpeting, insulation, water coolers
and any other locations where stagnant water and moisture could accumulate, and
(iii) otherwise maintain, operate and repair the Premises to prevent the
generation, growth, deposit, release or circulation of any Contaminants.

         (47) Supplier shall permit PacifiCare or its landlord to enter any
PacifiCare Service Location at reasonable times upon prior notice (except that
in the case of emergencies no prior notice shall be required) to examine such
location, and to show the same to prospective purchasers, lenders or tenants, to
make such repairs, alterations, additions or improvements as may be required in
connection with the development or maintenance of said location, without the
same constituting an eviction of Supplier or a trespass.
<PAGE>
                                  SCHEDULE 7.1

                               ASSIGNED AGREEMENTS
                                       IBM

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
     NO.                        SUPPLIER:                        DESCRIPTION:
--------------------------------------------------------------------------------
<S>                 <C>                                    <C>
[...***...]         [...***...]                            [...***...]
--------------------------------------------------------------------------------
</TABLE>

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       2.
<PAGE>
                                  SCHEDULE 7.2

                               MANAGED AGREEMENTS

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
      NO.                     SUPPLIER:                       DESCRIPTION:
--------------------------------------------------------------------------------
<S>                  <C>                                 <C>
[...***...]          [...***...]                         [...***...]
--------------------------------------------------------------------------------
</TABLE>

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                   SCHEDULE 8

                            SERVICE LEVEL AGREEMENT
<PAGE>
                                   SCHEDULE 8

--------------------------------------------------------------------------------
                             SERVICE LEVEL SCHEDULE
                                      IBM
--------------------------------------------------------------------------------

                                [PACIFICARE LOGO]

Confidential                      Page 1 of 51                           3/15/02
<PAGE>
Confidential

                                TABLE OF CONTENTS

I.    GENERAL PROVISIONS:......................................................4

   A.    General:..............................................................4

   B.    Attachments:..........................................................4

   C.    Reporting:............................................................5

   D.    Definitions:..........................................................5

   E.    Notice Requirements for Additions, Deletions and Modifications:.......7

   F.    Service Level Credits:................................................8

   G.    Earn back:............................................................9

   H.    Additions and Deletions of Performance Categories:...................10

   I.    Additions and Deletions of Service Levels:...........................10

   J.    Modifications of Service Level Credit Allocation Percentages for
         Critical Service Levels:.............................................12

   K.    Critical Deliverables:...............................................12

   L.    Commencement of Obligations:.........................................12

   M.    Cooperation:.........................................................12

   N.    [...***...] - Critical Service Levels:...............................13

   O.    Root-Cause Analysis:.................................................13

   P.    Measuring & Monitoring Tools:........................................14

   Q.    Exceptions:..........................................................14

   R.    Exclusions:..........................................................14

II.   CRITICAL SERVICE LEVELS:................................................16

   A.    Performance Category  - Critical Application Availability:...........16

   B.    Performance Category -  Application Availability:....................16

   C.    Performance Category Critical Application Response Time..............16

   D.    Performance Category  - Application Response Time:...................16

   E.    Performance Category  Critical Processes:............................16

   F.    Performance Category - Infrastructure Services Levels:...............16

   G.    Other Service Levels.................................................17

III.     CRITICAL DELIVERABLES:...............................................18

   A.    Policy and Procedure Manual Draft:...................................18

   B.    Report Format Draft:.................................................18

   C.    Annual Plan..........................................................18

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   D.    PacifiCare IS Customer Satisfaction Survey Draft Questions...........18

   E.    PacifiCare IS Customer Satisfaction Survey Key Measurements Plan.....18

   F.    Completion of Physical Inventory:....................................18

   G.    Creation of New Development Lab:.....................................18

IV.      KEY MEASUREMENTS:....................................................19

   A.    Performance Category -  Application Availability:....................19

   B.    Performance Category Application Response Time:......................19

   C.    Performance Category  -  Application Performance Degradation:........19

   D.    Performance Category Critical Processes:.............................19

   E.    Other Service Levels.................................................19

   F.    Performance Category - Applications Performance:.....................20

   G.    Performance Category - Desktop:......................................20

   H.    Performance Category -  Infrastructure Availability..................23

   I.    Performance Category  - Voice Services...............................24

   J.    Performance Category  - Video Conferencing Services..................25

   K.    Performance Category  - Help Desk:...................................26

   L.    Performance Category - Account Administration:.......................28

   M.    Performance Category - Supplier Staffing.............................30

   N.    Performance Category  - Change Management:...........................31

   O.    Performance Category - Project Management and Delivery:..............31

   P.    Performance Category - Disaster Recovery:............................33

   Q.    Performance Category - IDC Critical Outputs..........................35

V.    DEFINITION OF TERMS USED IN SERVICE LEVELS..............................41

                                  Page 3 of 51                 [PACIFICARE LOGO]
<PAGE>
                             SERVICE LEVEL SCHEDULE

I.       GENERAL PROVISIONS:

A.       GENERAL:

         1.   This Service Level Schedule, including any attachments hereto,
              (the "Schedule") is a schedule to that certain Information
              Technology Services Agreement entered into and made to be
              effective as of ____________, 2001 by and between PacifiCare and
              Supplier (the "Agreement").

         2.   In the event of any conflict, confusion or ambiguity between this
              Schedule and the Agreement, the Agreement shall control.

         3.   This Schedule sets forth certain quantitative Critical Service
              Levels, Key Measurements and Critical Deliverables against which
              Supplier's performance shall be measured and does not replace any
              requirements or obligations on Supplier to provide the Service or
              any subset thereof. Supplier shall perform the Services at or
              above the levels of performance indicated in this Schedule.
              Critical Service Levels are identified in Section II below.
              Critical Deliverables are identified in Section III below. Key
              Measurements are described in Section IV below.

         4.   As of the Cutover Date, Supplier shall perform the Services
              consistent with the documented levels of performance, measured for
              [...***...] consecutive months from [...***...] of 2001 that have
              been achieved by PacifiCare. In the event that PacifiCare does not
              have documented levels of performance, Supplier shall perform the
              measurements in accordance with Section I.I.1. During such
              measurement period, Service Level Credits shall not apply.

         5.   In the case of Services that do not have corresponding Service
              Levels specified in this Schedule as of the Cutover Date, Supplier
              shall provide such Services to PacifiCare Entities at least at the
              same level of performance (including the degree of accuracy,
              quality, completeness, responsiveness, etc.) as such Service was
              provided by or for PacifiCare prior to the Cutover Date or at the
              appropriate Service Level as shall be determined in accordance
              with the process set forth herein.

         6.   New Performance Categories, Critical Service Levels and Key
              Measurements may be added or substituted by PacifiCare as
              specified in this Schedule during the Term and during the
              Termination Assistance Period in order to achieve a fair, accurate
              and consistent measurement of Supplier's performance of the
              Services. For example, such additions or substitutions may occur
              in conjunction with changes to the environment and the
              introduction of New Equipment or means of service delivery; the
              Parties agree that in the event such New Equipment or such means
              of service delivery is a replacement or upgrade of existing
              technology, there shall be a presumption of equivalent or improved
              performance.

B.       ATTACHMENTS:

         The following Service Level Attachments are attached hereto and are
         hereby incorporated by reference:

         SLA-1 Service Level Matrix;

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         SLA-2 Service Level Outcome Examples;

         SLA-3 Pre-approved Measuring Tools and Methodologies for Critical
               Service Level Measurements;

         SLA-4 Application Summaries;

         SLA-5 PacifiCare Disaster Recovery Program Charter.

C.       REPORTING:

         Unless otherwise specified in this Service Level Schedule, Supplier
         shall measure and report Supplier's performance with respect to each
         Critical Service Level and Key Measurement on a monthly basis. On or
         before the fifteenth (15th) of each month of the Term and the
         Termination Assistance Period, Supplier shall provide to PacifiCare a
         Service Level Report of Supplier's performance with respect to the
         applicable Service Levels for the preceding month, including Supplier's
         actual performance, any Service Level Defaults that occurred and
         Service Level Credits that accrued during the month. Supplier shall
         provide the Service Level Reports in hard copy and soft-copy formats;
         formats can include Microsoft Office Word, Excel and any other format
         as reasonably requested by PacifiCare. Supplier shall include in the
         Service Level Reports sufficient details of Supplier's performance of
         the Services to allow verification of Supplier's performance and
         compliance with the Critical Service Levels, Key Measurements and
         Critical Deliverables, which such information shall be in
         machine-readable form, as specified by PacifiCare, suitable for use on
         a personal computer. All information supplied as part of and in
         connection with the Service Level Reports shall be Confidential
         Information of PacifiCare. Each Service Level Report shall include
         total invoice costs (including Base Fees and Variable Fees), for the
         month to which the Service Level Report applies, which may be in
         summary form. For example, the Service Level Report for Supplier's
         performance in August shall include a summary of the invoice for the
         Base Fees and Variable Fees applicable to August. Each Service Level
         Performance Report shall contain a summary page that indicates the
         total amount of Service Level Credits incurred during the previous
         month and a running total of all Service Level Credits and Deliverable
         Credits accrued or incurred during the then-current Contract Year.

D.       DEFINITIONS:

         Terms used herein with initial capital letters shall have the
         respective meanings set forth in the Agreement, or, for those terms
         that are not defined in the Agreement, the meanings set forth in this
         Schedule in Section V and as follows:

              a.     ALLOCATION OF POOL PERCENTAGE shall have the meaning set
                     forth in Section I.F.1 of this Service Level Schedule. The
                     total of all Allocation of Pool Percentages shall not
                     exceed the Pool Percentage Available for Allocation.

              b.     APPLICATION means PacifiCare Software, or any particular
                     component thereof, as applicable.

              c.     AT RISK AMOUNT shall mean, for any month during the Term
                     and Termination Assistance Period, [...***...] percent
                     ([...***...]%) of the monthly Fees, which is the amount
                     that Supplier shall have At risk for Service Level Credits
                     as set forth in Service Level Attachment SLA-1.

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<PAGE>
              d.     CHANGE MANAGEMENT PROCEDURES shall mean those procedures
                     that govern the process by which Supplier will manage
                     changes, modifications, additions, deletions and other
                     alterations of the configurational and operational aspects
                     of the Systems, as set forth in the Policy and Procedures
                     Manual.

              e.     CONTRACT YEAR shall mean each year from the anniversary of
                     the Effective Date.

              f.     CRITICAL DELIVERABLES shall mean those deliverables
                     performed on a one-time basis, for which a Deliverable
                     Credit shall be payable in accordance with Section I.K of
                     this Service Level Schedule and described in Section III of
                     the Service Level Schedule if Supplier fails to deliver
                     such deliverables. Critical Deliverables are identified in
                     Service Level Attachment SLA-1. Critical Deliverables are
                     not Critical Service Levels.

              g.     CRITICAL SERVICE LEVELS shall mean those Service Levels
                     established under this Service Level Schedule for which a
                     Service Level Credit shall accrue as set forth in Section
                     I.F, subject to earnback provisions of Section I.G.
                     Critical Service Levels are identified in Service Level
                     Attachment SLA-1 and are described in Section II of this
                     Service Level Schedule. Each Critical Service Level has an
                     Expected Service Level and a Minimum Service Level
                     associated with it unless otherwise specified.

              h.     DELIVERABLE CREDITS shall have the meaning set forth in
                     Section I.K of this Service Level Schedule.

              i.     EXPECTED SERVICE LEVEL shall mean the desired level of
                     performance for a Critical Service Level or a Key
                     Measurement, as set forth in Service Level Attachment
                     SLA-1.

              j.     EXPECTED SERVICE LEVEL DEFAULT shall mean Supplier's level
                     of performance for a particular Critical Service Level
                     fails to meet the applicable Expected Service Level (but
                     does not fail to meet the applicable Minimum Service Level)
                     as specified in this Service Level Schedule, and has failed
                     to meet such Expected Service Level [...***...]

              k.     KEY MEASUREMENTS shall mean those Service Levels for which
                     no Service Level Credit is payable, but which are
                     meaningful to PacifiCare Entities' business operations, and
                     are described in Section IV of this Service Level Schedule.
                     Each Key Measurement has an Expected Service Level and a
                     Minimum Service Level associated with it unless otherwise
                     specified. It is the intent of the Parties that all Key
                     Measurement shall be quantifiable, measurable and
                     objective.

              l.     MEASUREMENT WINDOW shall mean the time during which
                     performance of a Service Level, Application, or other
                     element of the Services shall be measured, which such time
                     shall exclude approved Scheduled Downtime.

              m.     MINIMUM SERVICE LEVEL shall mean the minimum level of
                     performance set forth in Service Level Attachment SLA-1
                     with respect to each Critical Service Level or Key
                     Measurement.

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              n.     MINIMUM SERVICE LEVEL DEFAULT shall mean Supplier's level
                     of performance for a particular Critical Service Level
                     fails to meet the applicable Minimum Service Level at any
                     time.

              o.     MONTHLY FEES shall mean the Base Fees and Variable Fees for
                     a calendar month.

              p.     OTHER SUPPLIER(S) shall mean and other third parties,
                     excluding Keane, contracted by PacifiCare.

              q.     PERFORMANCE CATEGORY shall mean a grouping of Critical
                     Service Levels as set forth on Service Level Attachment
                     SLA-1. Critical Deliverables do not constitute a
                     Performance Category.

              r.     POOL PERCENTAGE AVAILABLE FOR ALLOCATION shall mean
                     [...***...] percent ([...***...]%) of the At Risk Amount.

              s.     SERVICE LEVEL CREDIT shall have the meaning set forth in
                     Section I.F.1 of this Schedule.

              t.     SERVICE LEVEL CREDIT ALLOCATION PERCENTAGE shall have the
                     meaning set forth in Section I.F.1 of this Service Level
                     Schedule. The sum of the Service Level Credits Allocation
                     Percentages shall not exceed one hundred percent (100%) for
                     each Performance Category.

              u.     SERVICE LEVEL DEFAULT shall mean a Minimum Service Level
                     Default or an Expected Service Level Default.

              v.     SERVICE LEVEL REPORT shall mean the monthly report of
                     Supplier's performance with respect to the Service Levels
                     set forth in this Service Level Schedule and any Service
                     Level Defaults and Service Level Credits attributable to
                     Supplier's performance during the preceding month, as set
                     forth in Section I.C. of this Service Level Schedule.

              w.     SIX-MONTH MEASUREMENT PERIOD shall mean, if Section I.I.1
                     of this Schedule is used to establish the Expected Service
                     Level and Minimum Service Level commitments, the six (6)
                     consecutive months of measurements immediately preceding
                     the month in which PacifiCare provided notice to Supplier.

              x.     UNRELIEVED SERVICE LEVEL CREDITS shall have the meaning set
                     forth in Section I.G.4 of this Service Level Schedule.

              y.     YEARLY PERFORMANCE AVERAGE shall have the meaning set forth
                     in Section I.G.1.b of this Service Level Schedule.

E.       NOTICE REQUIREMENTS FOR ADDITIONS, DELETIONS AND MODIFICATIONS:

         PacifiCare shall send notice to Supplier at least ninety (90) days
         prior to the date that additions or deletions to Performance
         Categories, or additions or deletions to Service Levels (which include
         Critical Service Levels and Key Measurements), or modifications to
         Service Level Credit Allocation Percentages for any Critical Service
         Levels are to be effective, provided that

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<PAGE>
         PacifiCare may send only one (1) such notice (which notice may contain
         multiple changes) each calendar quarter.

F.       SERVICE LEVEL CREDITS:

         In the event of a Service Level Default, Supplier shall provide
         PacifiCare credits as calculated below.

         1.   Service Level Attachment SLA-1 sets forth the information required
              to calculate the credits that shall accrue to PacifiCare (and that
              Supplier shall credit to PacifiCare as set forth in Section I.G.4)
              in the event of a Service Level Default ("SERVICE LEVEL CREDIT").
              For each Service Level Default, subject to Section I.G below, a
              Service Level Credit that shall accrue to PacifiCare and shall be
              computed in accordance with the following formula:

              SERVICE LEVEL CREDIT = A   x   B   x   C

              Where:

              A = The Allocation of the Pool Percentage specified for the
              Performance Category in which the Service Level Default occurred
              as shown in Service Level Attachment SLA-1 (the "ALLOCATION OF
              POOL PERCENTAGE").

              B = The percentage of the Allocation of Pool Percentage allocated
              to the Critical Service Level in which the Service Level Default
              occurred as shown in Service Level Attachment SLA-1 (the "SERVICE
              LEVEL CREDIT ALLOCATION PERCENTAGE")

              C = At Risk Amount

              For example, assume that Supplier fails to meet the Minimum
              Service Level for a Critical Service Level, and that the
              Supplier's total Monthly Fees for the month in which the Service
              Level Default occurred were $100,000.

              Additionally, assume that the Allocation of Pool Percentage for
              the Performance Category of such Critical Service Level is
              [...***...]% and that its Service Level Credit Allocation
              Percentage is [...***...]%. The Service Level Credit due to
              PacifiCare for such Service Level Default would be computed as
              follows:

              A = [...***...]% (the Allocation of Pool Percentage),

              Multiplied by

              B = [...***...]% (the Service Level Credit Allocation Percentage),

              Multiplied by

              C = [...***...] percent [...***...] of $100,000, Supplier's Fees
              for the month during which the Service Level Default occurred).

              = [...***...] (the amount of the Service Level Credit)

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         2.   If one (1) or more than one (1) Service Level Default has occurred
              in a single month where the Supplier has failed to meet more than
              one (1) Minimum Service Level, the sum of the corresponding
              Service Level Credit(s) shall accrue to PacifiCare.

         3.   In no event shall the amount of Service Level Credits that accrue
              to PacifiCare with respect to all Service Level Defaults occurring
              in a single month exceed, in total, the At Risk Amount.

         4.   Supplier shall notify PacifiCare if PacifiCare accrues a Service
              Level Credit, which notice shall be included in the Service Level
              Reports described in Section I.C. The Service Level Reports shall
              also describe any failure to meet Key Measurements for the month.

G.       EARN BACK:

         Supplier shall have earn back opportunities with respect to Service
         Level Credits as follows:

         1.   Within fifteen (15) days after the last day of each Contract Year,
              Supplier shall provide a report to PacifiCare that shall include,
              with respect to each Critical Service Level for which there was a
              Service Level Default during the preceding Contract Year, the
              following:

              a.     Statistics on Supplier's monthly performance during the
                     preceding Contract Year;

              b.     The average of Supplier's monthly performances in that
                     Critical Service Level during the preceding Contract Year
                     ("YEARLY PERFORMANCE AVERAGE"); and

              c.     The total amount of Service Level Credits accrued to
                     PacifiCare for Service Level Defaults.

         2.   If during the preceding Contract Year Supplier achieved a Yearly
              Performance Average in a Critical Service Level that was greater
              than or equal to the Expected Service Level in effect for such
              Critical Service Level during the preceding year, then Supplier
              shall be relieved from paying any Service Level Credits that
              accrued during the preceding Contract Year for such Critical
              Service Level.

         3.   If during the preceding Contract Year PacifiCare deletes a
              Critical Service Level, then Supplier shall be relieved from
              paying Service Level Credits assessed during the preceding
              Contract Year for Service Level Defaults in that Critical Service
              Level only for the time period for which the deletion was
              effective.

         4.   Supplier shall pay to PacifiCare the amounts of any Service Level
              Credits accrued to PacifiCare for which Supplier is not relieved
              pursuant to Section I.G.2 or I.G.3 above for each Contract Year
              ("UNRELIEVED SERVICE LEVEL CREDITS") as a credit to PacifiCare on
              the monthly invoice reflecting charges to PacifiCare for the first
              month of the Contract Year immediately following the Contract Year
              in which such Service Level Credits accrued. In the case where
              there shall be no further invoices, Supplier shall pay the accrued
              amount of the Unrelieved Service Level Credits to PacifiCare
              within fifteen (15) days after the end of the last month of the
              Term.

         5.   If the Agreement is terminated prior to the end of the Initial
              Term, any Extension Period or any Renewal Term, the foregoing
              process shall be undertaken with respect to the portion of the
              Contract Year during which the Agreement was in effect.

                                  Page 9 of 51                 [PACIFICARE LOGO]

<PAGE>
H.       ADDITIONS AND DELETIONS OF PERFORMANCE CATEGORIES:

         PacifiCare may add or delete Performance Categories by sending notice
         as described in Section I.E above. In no event may: (1) the sum of the
         Allocations of Pool Percentage for all the Performance Categories
         exceed the Pool Percentage Available for Allocation, or (2) the sum of
         the Service Level Credit Allocation Percentages for all Critical
         Service Levels within a Performance Category exceed one hundred percent
         (100%).

I.       ADDITIONS AND DELETIONS OF SERVICE LEVELS:

          PacifiCare may add or delete Service Levels pursuant to the following
         provisions. PacifiCare may require the addition of Services Levels,
         including Service Levels required to address Supplier's performance
         with respect to New Services, Services for which a Service Level does
         not exist but for which PacifiCare requires a Service Level and for any
         changes in Supplier's performance that can reasonably be expected due
         to the addition or utilization of new, updated, upgraded or modified
         Equipment, Systems, Applications or other technology.

         1.   ADDITIONS:

                PacifiCare may add Service Levels in accordance with this
                Section I.I.1 and by providing notice in accordance with Section
                I.E. Expected Service Levels and Minimum Service Level
                commitments associated with added Service Levels shall be
                computed as follows:

                a.    Where measurements exist for at least [...***...] for a
                      particular Service that is being provided by Supplier, the
                      Parties agree that the Expected Service Level shall be
                      defined as the average performance indicated by such
                      measurements for [...***...] Measurement Period and that
                      the Minimum Service Level shall be defined as the
                      lowest(1) measurements achieved during [...***...]
                      Measurement Period, or

                b.    Where less than [...***...] of measurements (or no
                      measurements) exist for a particular Service that is being
                      provided by Supplier, the Parties shall attempt in good
                      faith to agree on an Expected Service Level and a Minimum
                      Service Level commitment using industry standard measures
                      or third party advisory services [...***...], or

                c.    Where less than [...***...] of measurements (or no
                      measurements) exist for a particular Service that is being
                      provided by Supplier, and the Parties fail to agree on an
                      Expected Service Level and a Minimum Service Level
                      commitment using Section I.I.1.b above, the Parties shall
                      do the following:

                      1)   Supplier shall begin providing monthly measurements
                           within [...***...]

------------------------------

(1) [...***...]

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                           [...***...]

                      2)   After [...***...] measurements have been taken (or
                           should have been taken per Section I.I.1.c(1) above
                           and if not so measured; constructed as described in
                           Section I.I.1.c(2)(a) below), PacifiCare may at any
                           time in writing request that Section I.I.1.a above be
                           used to establish the Expected Service Level and
                           Minimum Service Level commitments.

                                (a)  If Supplier is responsible for measuring
                                     actual service levels for [...***...] and
                                     fails to provide one (1) or more
                                     measurements during the [...***...]
                                     Measurement Period such that [...***...]
                                     consecutive measurements are NOt available,
                                     the missing measurement(s) shall be
                                     constructed according to the following;
                                     [...***...].

                                (b)  [...***...]

         2.   DELETIONS:

                      PacifiCare may delete Service Levels by sending notice to
                      Supplier in accordance with Section I.E.

         3.   IMPACT OF ADDITIONS AND DELETIONS OF CRITICAL SERVICE LEVELS ON
              SERVICE LEVEL CREDIT ALLOCATION PERCENTAGES:

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                      When adding or deleting a Critical Service Level,
                      PacifiCare shall modify the Service Level Credit
                      Allocation Percentages for the Critical Service Levels
                      within the Performance Category such that the total
                      Service Level Credit Allocation Percentages for all
                      Critical Service Levels within the Performance Category
                      equals one hundred percent (100%). If PacifiCare adds a
                      Critical Service Level in accordance with Section I.I.1
                      above, but does not modify the Service Level Credit
                      Allocation Percentages for the Critical Service Levels
                      within the applicable Performance Category under this
                      Section I.I.3, then, until such time as PacifiCare so
                      modifies such Service Level Credit Allocation Percentages,
                      the Service Level Credit Allocation Percentage for such
                      added Critical Service Level shall be zero (0).

J.       MODIFICATIONS OF SERVICE LEVEL CREDIT ALLOCATION PERCENTAGES FOR
         CRITICAL SERVICE LEVELS:

         PacifiCare may modify the Service Level Credit Allocation Percentages
         for any Critical Service Levels within the Performance Category by
         sending notice in accordance with Section I.E. PacifiCare shall modify
         the Service Level Credit Allocation Percentages for two (2) or more of
         the Critical Service Levels within the Performance Category such that
         the sum of the Service Level Credit Allocation Percentages for all
         Critical Service Levels within the Performance Category equals one
         hundred percent (100%).

K.       CRITICAL DELIVERABLES:

         Service Level Attachment SLA-1 sets forth the credits that shall be
         payable by Supplier to PacifiCare in the event Supplier fails to
         deliver any of the Critical Deliverable by the time specified for the
         delivery of such Critical Deliverable in Service Level Attachment SLA-1
         ("DELIVERABLE CREDITS"). [...***...]. The total amount of Deliverable
         Credits that Supplier incurs each month shall be reflected On the first
         monthly invoice after the month during which the Deliverable Credits
         accrued (e.g., the amount of Deliverable Credits payable for failure to
         deliver any Critical Deliverable(s) in August shall be credited against
         the September invoice for Base Fees). Unlike Service Level Credits,
         Deliverable Credits shall be shown in each monthly invoice as an actual
         credit to the charges [...***...].

L.       COMMENCEMENT OF OBLIGATIONS:

         The obligations set forth in this Service Level Schedule shall commence
         on the Effective Date or as otherwise specified in Service Level
         Attachment SLA-1 referencing the column "cutover + mos**". The number
         used in the column "cutover +mos**" are in the format X where "X"
         represents the number of months after Cutover Date that the Supplier
         shall be responsible to provide measurement data in support of the
         Critical Service Level and Supplier shall be responsible for Service
         Level Credits for any failures to attain the Critical Service Level. In
         the event any Service Levels are added pursuant to Section I.I.1 above,
         Supplier's obligations shall commence at the time that the Expected
         Service Level or Minimum Service Level, as applicable, has been defined
         for the added Service Level.

M.       COOPERATION:

         Without limiting or altering any of Supplier's obligations as set forth
         in Section 13.2. of the Agreement, Supplier shall provide a single
         point of contact for the prompt resolution of all

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         Service Level Defaults and all failures to provide high quality
         Services to PacifiCare, regardless of whether the reason for such
         Service Level Defaults, or failure to provide high quality outsourcing
         Services to PacifiCare, was caused by Supplier or Other Suppliers.

N.       AUTOMATIC ADJUSTMENT - CRITICAL SERVICE LEVELS:

         The Parties agree to the concept of [...***...]. Critical Service
         Levels shall be [...***...] each [...***...] period following the
         commencement of obligations dates specific to each Critical Service
         Level as described in Section I.L and below:

         1.   [...***...]

         2.   [...***...]

         3.   In any event, in the case of very high Service Levels, the
              cost-benefit of applying these [...***...] rules may not
              be present. In these cases the parties agree to discuss and reset
              the Expected Service Levels and Minimum Service Levels by mutual
              agreement.

         4.   [...***...]

         5.   In no event will any adjustment of any Critical Service Level
              result in any Expected Service Level or Minimum Service Level
              being reset below the level of the applicable Expected Service
              Level or Minimum Service Level prior to the adjustment.

O.       ROOT-CAUSE ANALYSIS:

         If a problem is defined as Severity Level 0 or 1 for any Service Level,
         then Supplier shall perform root-cause analysis for such failure as
         described in Section 8.4 of the Agreement.

         Without limiting or altering any of the Supplier's obligations pursuant
         to Section 8 of the Agreement, Supplier's root-cause analysis for each
         Service Level Default shall determine a single root-cause for each such
         Service Level Default. If a single root-cause incident results in more
         than one (1) Service Level Default, then PacifiCare shall select one
         (1) Service Level Default for which PacifiCare shall be entitled to
         receive a Service Level Credit. PacifiCare shall not be entitled to a
         Service Level Credit for each such Service Level Default attributable
         to each root-cause incident. [...***...].

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         [...***...].

         With regards to root cause analysis and Service Level Defaults, the
         term ILIAD refers to a group of applications consisting of ILIAD
         Claims, ILIAD Member Services and ILIAD Provider Services. The term
         NICE refers to a group of applications consisting of NICE Claims, NICE
         Membership - Commercial, NICE Membership - Secure and NICE Provider
         Contracts.

         PacifiCare reserves the right to add, delete or change the Applications
         within each grouping providing that the Application being substituted
         is part of the existing suite and currently exists in Key Measurements.

P.       MEASURING & MONITORING TOOLS:

         As of the Cutover Date, the measuring tools and methodologies set forth
         in Service Level Attachment SLA-3 to this Service Level Agreement
         represent acceptable tools and methodologies for measuring the Critical
         Service Levels. If there are any Critical Service Levels for which the
         measuring tools and methodologies have not been agreed upon by
         PacifiCare and Supplier and included in Attachment SLA-3 and Supplier
         fails to propose a measuring tool or methodology for such Critical
         Service Level that is acceptable to PacifiCare prior to the date upon
         which Supplier shall be responsible for measuring such Service Level
         performance and Service Level Credits due for applicable Service Level
         Defaults, then such failure to provide an acceptable measuring tool and
         methodology shall be deemed a Minimum Service Level Default for the
         applicable Critical Service Level until Supplier proposes and
         implements an acceptable measuring tool.

         Tools for new Critical Service Levels shall be implemented according to
         the Change Management Procedures. If after the Cutover Date or the
         implementation of measuring tools methodologies for new Critical
         Service Levels Supplier desires to use different measuring and tools or
         methodologies for a Critical Service Level, then Supplier shall provide
         notice to PacifiCare, in which event the Parties shall reasonably
         adjust the measurements as necessary to account for any increased or
         decreased sensitivity in such new tools or methodologies. If the
         Parties cannot agree on the required adjustment, Supplier shall
         continue to use the measuring tools and methodologies that had been
         initially agreed to by the Parties.

Q.       EXCEPTIONS:

         Supplier shall not be responsible for a failure to meet any Service
         Level solely to the extent that such failure is directly attributable
         to any of the following:

         1.     PacifiCare's breach of this Agreement, or the failure of a
                PacifiCare Agent to perform according to the terms of such
                PacifiCare Agent's agreement with PacifiCare, or the acts of
                PacifiCare or of a PacifiCare Agent that directly cause
                Supplier's failure to perform, provided that, in each case,
                Supplier used all reasonable efforts to meet the Service Levels
                as specified.

         2.     Service or resource reductions requested or approved by
                PacifiCare and agreed to by the Parties through the Change
                Control Procedures; provided that Supplier has previously
                notified PacifiCare in writing prior to the execution of such
                Change Control Procedures that the implementation of such
                request would result in such failure to meet the Service Level.

R.       EXCLUSIONS:

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         For purposes of calculating Availability, Scheduled Uptime and
         Unscheduled Downtime shall not include any period of Scheduled Downtime
         that is the result of scheduled time required to perform system
         maintenance (e.g., Preventive Maintenance (as defined in Exhibit B,
         Statement of Work), system upgrades, data center relocation, etc.),
         provided that such time has been mutually agreed between the Parties.

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II.      CRITICAL SERVICE LEVELS:

         This section sets forth descriptions of the Critical Service Levels.
         The Minimum Service Levels and the Expected Service Levels associated
         with the following Critical Service Levels are set forth in Service
         Level Attachment SLA-1.

A.       PERFORMANCE CATEGORY  - CRITICAL APPLICATION AVAILABILITY:

         Supplier shall measure and report the Availability of each Critical
         Application identified in Service Level Attachment SLA-1 ("CRITICAL
         APPLICATION AVAILABILITY"), which such Critical Application
         Availability shall constitute a Critical Service Level.

B.       PERFORMANCE CATEGORY -  APPLICATION AVAILABILITY:

         Supplier shall measure and report the Availability of each Application
         identified in Service Level Attachment SLA-1 ("APPLICATION
         AVAILABILITY"), which such Application Availability shall constitute a
         Critical Service Level.

C.       PERFORMANCE CATEGORY CRITICAL APPLICATION RESPONSE TIME

         Supplier shall measure and report the Response Time of each Critical
         Application identified in Service Level Attachment SLA-1 ("CRITICAL
         APPLICATION RESPONSE TIMe"), which such Critical Application Response
         Time shall constitute a Critical Service Level.

D.       PERFORMANCE CATEGORY  - APPLICATION RESPONSE TIME:

         Supplier shall measure and report the Response Time of each Application
         identified in Service Level Attachment SLA-1 ("APPLICATION RESPONSE
         TIMe"), which such Application Response Time shall constitute a
         Critical Service Level.

E.       PERFORMANCE CATEGORY  CRITICAL PROCESSES:

         The Batch Schedule Completion On-Time Rate calculation includes
         production of updated files and appropriate reports, produced in a
         calendar month.

         For avoidance of doubt, the list of all Critical Batch Jobs to be
         tracked in this performance category can be found on the Service Level
         Attachment SLA-1 1 under the title Critical Batch Jobs and shall herein
         be known as Scheduled Batch Jobs.

         [...***...].

         With respect to ongoing Scheduled Batch Job schedule requirements,
         Supplier shall be responsible to make updates to the job schedules as
         required and review such updates with PacifiCare no less frequently
         than [...***...].

F.       PERFORMANCE CATEGORY - INFRASTRUCTURE SERVICES LEVELS:

         1.       LAN AVAILABILITY:

         "AVAILABLE FOR USE" shall mean, with respect to each LAN Segment, that
         each End-User

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         connected to that LAN Segment is able to use the LAN Segment and all
         functionality that the LAN is intended to provide. If there is LAN
         Downtime with respect to a LAN Segment, which is then brought back up,
         except for the restoration of data that may have been lost, it is
         understood that such data restoration shall not prevent the LAN Segment
         from being deemed "Available for Use".

         [...***...].

         2.   ASPECT AUTOMATIC CALL DISTRIBUTION ("ACD") EQUIPMENT AVAILABILITY:

         [...***...].

G.       OTHER SERVICE LEVELS

         1.   NICE CLAIMS AVERAGE DAILY VOLUME

              [...***...]

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III.     CRITICAL DELIVERABLES:

         If Supplier fails to deliver to PacifiCare any Critical Deliverables as
         described below, in format and content acceptable to PacifiCare by the
         date identified for such Critical Deliverable, Supplier shall provide
         PacifiCare, each month, a credit as set forth in Service Level
         Attachment SLA-1 until such Critical Deliverable is provided to
         PacifiCare.

A.       POLICY AND PROCEDURE MANUAL DRAFT:

         Supplier shall deliver to PacifiCare the draft of the Policy and
         Procedures Manual in conformance with the requirements described in
         Section 13.3 of the Agreement.

B.       REPORT FORMAT DRAFT:

         Supplier shall deliver to PacifiCare the draft of the portion of the
         Policy and Procedures Manual that pertains to the Services and other
         functions and aspects of Supplier's performance, in conformance with
         the requirements described in Section 13.3 of the Agreement.

C.       ANNUAL PLAN.

         Supplier shall deliver the Annual Plan as set forth in Section 3. (b)
         of the Agreement.

D.       PACIFICARE IS CUSTOMER SATISFACTION SURVEY DRAFT QUESTIONS.

         Supplier will provide a draft of customer satisfaction survey questions
         with regards to the service the Supplier provides. This draft is due
         [...***...] following the Effective Date. The draft will be revieweD by
         PacifiCare and blended into the annual IS Customer Satisfaction Survey
         conducted by an independent third party.

E.       PACIFICARE IS CUSTOMER SATISFACTION SURVEY KEY MEASUREMENTS PLAN

         [...***...] after the results of the first annual IS Customer
         Satisfaction Survey are available the SupplIeR shall provide a Key
         Measurements plan to measure the applicable improvement of Supplier
         provided service identified in the IS Customer Satisfaction Survey as
         requiring improvement. Identified Key Measurements shall be approved by
         PacifiCare and reported on a monthly basis. Annually, these Key
         Measurements will be adjusted based on the latest IS Customer
         Satisfaction Survey results.

F.       COMPLETION OF PHYSICAL INVENTORY:

         Supplier shall provide to PacifiCare a physical inventory of all
         Equipment (except Desktop PC) and Software that is used in the
         performance of the Services provided by Supplier in support of
         PacifiCare as set forth in Section 3.8 of the Agreement.

G.       CREATION OF NEW DEVELOPMENT LAB:

         Supplier shall provide for PacifiCare's use the development lab as set
         forth in Exhibit B (Statement of Work) within [...***...] of the
         Effective Date, [...***...].

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IV.      KEY MEASUREMENTS:

         This section Sets forth qualitative descriptions of the Key
         Measurements. The Minimum Service Level and Expected Service Level
         targets associated with such Key Measurements are set forth in Service
         Level Attachment SLA-1. The column "Track and Report by Region" on the
         Key Measurement tab of Service Level Attachment SLA-1 indicates the
         region(s) in which these Key Measurements apply. As indicated, the
         monthly performance reports should contain the results for these Key
         Measurements by region.

A.       PERFORMANCE CATEGORY -  APPLICATION AVAILABILITY:

         Supplier shall measure and report the Availability of each Application
         identified in Service Level Attachment SLA-1 ("APPLICATION
         AVAILABILITY"), which such Application Availability shall constitute a
         Key Measurement.

B.       PERFORMANCE CATEGORY APPLICATION RESPONSE TIME:

         Supplier shall measure and report the Response Time of each Application
         identified in Service Level Attachment SLA-1 ("APPLICATION RESPONSE
         TIMe"), which such Application Response Time shall constitute a Key
         Measurement.

C.       PERFORMANCE CATEGORY  -  APPLICATION PERFORMANCE DEGRADATION:

         Supplier shall measure and report Application performance degradation
         (slow response) using information as reported by the End-Users via the
         problem management process ("APPLICATION PERFORMANCE DEGRADATION").
         [...***...].

D.       PERFORMANCE CATEGORY CRITICAL PROCESSES:

         The Batch Schedule Completion On-Time Rate calculation includes
         production of updated files and appropriate reports, produced in a
         calendar month.

         For avoidance of doubt, the list of all Critical Batch Jobs to be
         tracked in this performance category can be found on the Service Level
         Attachment SLA-1 under the title Critical Batch Jobs and shall herein
         be known as Scheduled Batch Jobs.

         [...***...].

         With respect to ongoing Scheduled Batch Job schedule requirements,
         Supplier shall be responsible to make updates to the job schedules as
         required and review such updates with PacifiCare no less frequently
         than [...***...].

E.       OTHER SERVICE LEVELS

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         1.   NICE CLAIMS AVERAGE DAILY VOLUME

              [...***...].

         2.   COMPUTER INCIDENT RESPONSE:

              [...***...].

F.       PERFORMANCE CATEGORY - APPLICATIONS PERFORMANCE:

         GENERAL.  Supplier shall manage applications performance as to meet or
         be better than the Service Levels set forth in Service Level Attachment
         SLA-1.

         1.   [...***...].

         2.   [...***...].

G.       PERFORMANCE CATEGORY - DESKTOP:

         1.   RCSC DESKTOP, LAPTOP & WINDOWS TERMINAL   BREAK FIX - RESPOND
              WITHIN 1 HOUR:

              [...***...]

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              [...***...].

         2.   RCSC DESKTOP,  LAPTOP & WINDOWS TERMINAL  BREAK FIX - RESOLVE
              WITHIN 2 BUSINESS HOURS:

              [...***...].

         3.   CAMPUS DESKTOP, LAPTOP AND WINDOWS TERMINAL BREAK FIX - RESPOND
              WITHIN 1 HOUR:

              [...***...].

         4.   CAMPUS DESKTOP, LAPTOP AND WINDOWS TERMINAL BREAK FIX - RESOLVE
              WITHIN 8 BUSINESS HOURS:

              [...***...].

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              [...***...].

         5.   REMOTE DESKTOP, LAPTOP PC AND WINDOWS TERMINAL BREAK FIX - RESPOND
              WITHIN 1 HOUR:

              [...***...].

         6.   REMOTE DESKTOP, LAPTOP PC AND WINDOWS TERMINAL BREAK FIX - RESOLVE
              BY THE NEXT BUSINESS DAY:

              [...***...].

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              [...***...].

         7.   ACQUISITIONS - STANDARD QUOTE:

              A standard quote is a quote for a PC configuration, software or
              peripheral that has been selected, tested and approved for use in
              the enterprise in order to meet a business requirement.

              [...***...].

H.       PERFORMANCE CATEGORY -  INFRASTRUCTURE AVAILABILITY

         1.   WAN AVAILABILITY:

              WAN AVAILABILITY shall mean the PacifiCare Wide Area Network,
              router to router, is operating properly and available to end users
              in the ordinary course of business on a 7x24 basis, excluding
              Scheduled Downtime.

              [...***...].

         2.   WAN VENDOR AVAILABILITY

              WAN VENDOR AVAILABILITY shall mean that the Wide Area Network,
              Network Circuits (i.e. ATM, Frame Relay, Point to Point) provided
              by Telecommunication Carriers, are operating properly and
              available to end users in the ordinary course of business on a
              7x24 basis. [...***...].

         3.   SQL SERVER AVAILABILITY (DATA BASE)

              AVAILABLE FOR USE shall mean that the Server, including the
              processor and associated storage devices, cabling, peripherals and
              other equipment, is running properly so as to enable database
              support from a workstation.

              [...***...].

         4.   EXCHANGE SERVER AVAILABILITY (MAIL)

              AVAILABLE FOR USE shall mean that the Server, including the
              processor and associated storage devices, cabling, peripherals and
              other equipment, is running properly so as to enable mail support
              from a workstation.

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         [...***...].

         5.   INFRASTRUCTURE SERVER AVAILABILITY (FILE/PRINT):

              AVAILABLE FOR USE shall mean that the server, including the
              processor and associated storage devices, cabling, peripherals and
              other equipment, is running properly so as to enable proper
              printer support and transfer of files to and from a Workstation.

              [...***...].

         6.   LAN AVAILABILITY:

              "AVAILABLE FOR USE" shall mean, with respect to each LAN Segment,
              that each End-User connected to that LAN Segment is able to use
              the LAN Segment and all functionality that the LAN is intended to
              provide. If there is LAN Downtime with respect to a LAN Segment,
              which is then brought back up, except for the restoration of data
              that may have been lost, it is understood that such data
              restoration shall not prevent the LAN Segment from being deemed
              "Available for Use".

              [...***...].

         7.   ASPECT AUTOMATIC CALL DISTRIBUTION ("ACD") EQUIPMENT AVAILABILITY:

              [...***...].

I.       PERFORMANCE CATEGORY  - VOICE SERVICES

         1.   PREMISE VOICE AVAILABILITY:

              [...***...].

         2.   VOICE MAIL AVAILABILITY:

              [...***...].

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J.       PERFORMANCE CATEGORY  - VIDEO CONFERENCING SERVICES

         [...***...].

         1.   VIDEO CONFERENCING RESERVATION SYSTEM AVAILABILITY:

         The availability of the Supplier Video Conferencing Reservation System
         is essential to PacifiCare Entities' ability to obtain the advantages
         of using Video Conferencing. Supplier shall ensure the availability and
         complete functioning of the Video Conferencing Reservation System
         including access to necessary data. [...***...].

         2.   COMPLETE SUPPORT PROVIDED:

         [...***...].

         3.   SUCCESSFUL VIDEO CONFERENCE START-UPS:

         [...***...].

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         [...***...].

K.       PERFORMANCE CATEGORY  - HELP DESK:

         1.   HELP DESK SPEED OF ANSWER AFTER AUTOMATED MENU SELECTION:

         [...***...].

         2.   HELP DESK ABANDON RATE:

         [...***...].

         3.   HELP DESK FIRST CALL PROBLEM RESOLUTION (RESOLVABLE CALLS):

         [...***...].

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         [...***...].

         4.   HELP DESK PERCENTAGE OF PROBLEMS RESOLVED WITHIN THREE (3) DAYS:

         [...***...].

         5.   HELP DESK TIME FOR FINAL RESOLUTION OF CRITICAL SEVERITY HELP DESK
              CALLS:

         [...***...].

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         [...***...].

         6.   INITIAL NOTIFICATION TO IMPACTED END-USERS ON CRITICAL SEVERITY
              HELP DESK CALLS

         [...***...].

         7.   CSD HELP DESK - SATISFACTION RATE:

         [...***...].

L.       PERFORMANCE CATEGORY - ACCOUNT ADMINISTRATION:

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         1.   REMOTE ACCESS ACCOUNT CREATIONS (DAYS TO CLOSE):

         [...***...].

         2.   SYSTEM AND APPLICATION LOGONS ID CREATIONS:

         [...***...].

         3.   EXCHANGE ACCOUNT CREATION (DAYS TO CLOSE)

         [...***...].

         4.   IMAC COMPLETION -- INCLUDING REMOVALS, COMPLETE WITHIN 5 BUSINESS
              DAYS OF APPROVED REQUEST:

         [...***...].

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         [...***...].

         5.   PASSWORD RESET DURING HELP DESK CALL

         [...***...].

M.       PERFORMANCE CATEGORY - SUPPLIER STAFFING

         1.   RETENTION RATE - DEDICATED STAFF:

         [...***...].

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         [...***...].

N.       PERFORMANCE CATEGORY  - CHANGE MANAGEMENT:

         GENERAL. The intent of the Critical Service Levels under this Section
         is to address PacifiCare's concern that Supplier's responsiveness to
         End-Users during outages is essential to the satisfactory provision of
         Services. Subject to the requirements of this Section, Supplier's
         performance shall be better than, or at least equal to, the Critical
         Service Levels set forth in PacifiCare Service Level Attachment SLA-1.

         [...***...].

O.       PERFORMANCE CATEGORY - PROJECT MANAGEMENT AND DELIVERY:

         General. The Critical Service Levels under this Section are important
         to address PacifiCare's concern that implementation of Projects are
         managed to ensure they conform to approved schedule and budgets as well
         as the quality standards agreed by PacifiCare and Supplier. Supplier
         shall manage all Projects with respect to Project Deliverables so as to
         meet or be better than the Service Levels set forth in Service Level
         Attachment SLA-1.

         1.   PERCENT OF  MEASURED PROJECT SCHEDULE OVERRUNS

         [...***...].

         2.   MILESTONES DELIVERED TO SCHEDULE (WITHIN [...***...]%)

         [...***...].

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         [...***...].

         3.   PROJECTS DELIVERED TO BUDGET WITHOUT VARIANCE

              [...***...].

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              [...***...].

P.       PERFORMANCE CATEGORY - DISASTER RECOVERY:

         GENERAL. The intent of this measurement is to address PacifiCare's
         concern that the ability to develop, document, and test Disaster
         Recovery capability for Critical Systems and, if needed, use the
         Disaster Recovery Plans to rapidly recover from catastrophic failures
         is critical to PacifiCare Entities' ability to conduct its business
         processes in the event of a loss of Supplier's ability to provide the
         Services. Additionally, the ability to Backup Data to rapidly recover
         from Equipment failures that generate the need to restore files
         (applications or user data) is critical to PacifiCare Entities'
         business requirements.

         Subject to the requirements of this Section, Supplier shall provide
         this service as described below so as to meet or exceed the Service
         Levels set forth in Service Level Attachment SLA-1 and in accordance
         with the PacifiCare Disaster Recovery Plan.

         1.   MAINTAIN DISASTER RECOVERY PLANS AND DOCUMENTATION:

         [...***...].

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         [...***...].

         2.   BACK-UPS FOR MEASURED SYSTEMS -- FULL AND INCREMENTAL / CRITICAL
              AND NON-CRITICAL:

         For all Measured Systems, Supplier shall, during the Scheduled Backup
         Windows, perform Measured Backups as described in Service Level
         Attachment. Supplier shall advise PacifiCare of changes required to
         Service Level Attachment [SLA-1] as PacifiCare Entities' system files
         are added or modified, and, as such changes are approved by PacifiCare,
         update Service Level Attachment SLA-1 and review such updates with
         PacifiCare no less frequently than monthly.

         [...***...].

         3.   CONDUCT SUCCESSFUL DISASTER RECOVERY TEST -- APPLICATIONS,
              DATABASES AND NETWORK.

         Supplier shall, on an annual basis, test the Disaster Recovery Plan
         designed to achieve all Disaster Recovery Milestones identified in the
         Disaster Recovery Plan as critical to PacifiCare Entities' ability to
         conduct its business processes in the event of a loss of Supplier's
         ability to provide the Services.

         [...***...].

         4.   DISASTER RECOVERY RE-TEST -- WITHIN [...***...] OF FAILURE.

         Should Supplier fail to achieve any Disaster Recovery Milestone(s)
         required to demonstrate recoverability as defined in the Conduct
         Successful Disaster Recovery Test Key Measurement, Supplier shall be
         obligated to re-test the failed Disaster Recovery Milestone(s)
         ("Retest") within [...***...] of ThE failure(s) until successfully
         achieved.

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         [...***...].

         5.   FILE RESTORATION RECOVERY  - FROM ON-SITE STORAGE < 3 HOURS:

         The ability to rapidly recover from Equipment failures that generate
         the need to restore files (applications or user data) is critical to
         PacifiCare Entities' business requirements. This service level applies
         to loss of Data resulting from an Equipment failure or other
         catastrophic event, and not to loss of Data resulting from an error
         resulting in deletion of Data by a user.

         [...***...].

         6.   FILE RESTORATION RECOVERY  - FROM OFF-SITE STORAGE < 8 HOURS:

         The ability to rapidly recover from Equipment failures that generate
         the need to restore files (applications or user data) is critical to
         PacifiCare Entities' business requirements. This service level applies
         to loss of Data resulting from an Equipment failure or other
         catastrophic event, and not to loss of data resulting from an error
         resulting in deletion of Data by a user.

         [...***...].

Q.       PERFORMANCE CATEGORY - IDC CRITICAL OUTPUTS

         1.   CHECKS

              CHECKS created by the various Applications must be mailed on time
              per the detailed outline below.

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              The Service Level per tracked PacifiCare Service Location is
              calculated as follows:

              [...***...].

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              [...***...].

         2.   ELIGIBILITY REPORTS

                ELIGIBILITY REPORTS for NICE, and RIMS are required to be mailed
                twenty-four (24) hours after they are created. The Service Level
                per tracked PacifiCare Service Location is calculated as
                follows:

                [...***...].

         3.   BILLING:

              BILLING OUTPUTS created by the various Applications must be mailed
              on time per the detailed outline in SLA-1. The Service Level per
              tracked PacifiCare Service Location is calculated as follows:

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              [...***...].

         4.   ID CARDS:

              ID CARDS created by the various Applications must be mailed on
              time

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              ID CARDS created by the various Applications must be mailed on
              time per the detailed outline in SLA-1. The Service Level per
              tracked PacifiCare Service Location is calculated as follows:

              [...***...].

         5.   NIGHTLY REPORTS AVAILABLE IN FILESHARES (OR ERD):

              NIGHTLY REPORTS AVAILABLE IN FILESHARES (OR ERD) need to be
              processed and made available by 8:00 a.m. local regional time in
              the USA.

         6.   INBOUND MEDIA

              a.      Paper

                      1)   [...***...].

              b.      Electronic

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                      1)   [...***...].

         7.   [...***...] MAIL PROCESSING:

              a.      Mail Processing - Incoming / Outgoing mail must be
                      delivered or sent on the same day as received in the
                      mail-processing center via couriers from or to the
                      Campuses located in [...***...].

              b.      [...***...].

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V.       DEFINITION OF TERMS USED IN SERVICE LEVELS

The following terms when used in the Service Level Schedule (including any
exhibits thereto) with initial capital letters shall have the respective
meanings set forth herein. Terms used with initial capital letters that are not
defined herein shall have the meaning set forth in the Agreement.

[...***...].

d    ACTUAL SCHEDULED UPTIME of a particular System, Application, Software,
     Equipment, Network or any other part of the Services shall mean the
     Scheduled Uptime that a particular System, Application, Software,
     Equipment, Network or any other part of the Services is actually available
     during the Measurement Window, as specified in the Attachment SLA-1, for
     normal business use.

[...***...].

g    BACKUP shall mean to copy a file or files and place them in an appropriate
     alternate location so that a safe, usable copy remains if the original is
     destroyed.

[...***...].

i    BILLING OUTPUTS shall mean invoices sent to vary constituents specifying
     payments due.

j    BILLING OUTPUTS shall mean invoices sent to varied constituents specifying
     payments due

k    BROKER CHECKS shall mean checks issued to Brokers in payment of Commissions

l    BROKER CHECKS shall mean checks issued to Brokers in payment of
     commissions.

m    BUSINESS CONTINUITY PLAN shall mean Disaster Recovery Plan.

n    BUSINESS DAY shall mean Monday through Friday excluding national holidays
     and official PacifiCare holidays unless otherwise specified by PacifiCare
     Supplier Relationship Manager (or his / her designee).

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o    CALL shall mean a call to a Help Desk from an End-User requesting
     assistance that is related to the Services.

p    [...***...].

q    CAPITATION CHECKS shall mean checks covering monthly payment to Provider.

r    CAPITATION REPORTS shall mean reports supporting the monthly payment to
     Providers.

s    CERTIFIED BUSINESS CONTINUITY PLANNER is defined in Section IV.I.

t    CLAIM CHECKS are checks issued to providers or members for reimbursement of
     covered medical expenses.

u    [...***...].

v    COMPONENT shall mean any constituent part of a Product or Services, whether
     provided by Supplier or any other source.

w    CRITICAL APPLICATIONS are those applications that support critical business
     objectives within a specific reporting entity (region) and are tracked and
     measured using Online Hour Measurement Windows under the Critical Service
     Level Section of SLA-1.

x    CUSTOMER SUPPORT shall mean any effort required prior to establishing a
     development project or work on minor data changes, reports user questions,
     or training requests. Customer Support includes: Help Desk tickets not
     related to resolving production issues or bugs; minor user training;
     answering and addressing direct calls from business partners; business
     management requests for pre-project consultation (research, analysis,
     brainstorming, estimating); regular business partner/status meetings - not
     project related; business requested support for application demonstrations
     to customers; business requested support for generating presentation
     materials, not project related; meetings with employer groups/providers as
     requested by business partners; updates to production data or tables done
     outside of the normal application functionality.

y    DATA shall mean numbers, characters, images, or other PacifiCare Entities'
     information recorded in a form that can be input into a CPU, stored and
     processed there, or transmitted on some digital channel.

z    DEDICATED STAFF is defined in Section IV.E.1.

aa   DESKTOP PC shall mean an End-User PC configuration, including Standard
     Equipment (e.g., keyboard, monitor, CPU, mouse, peripherals, printers,
     plotters, video adapters, etc.), core system and user Software (i.e.,
     Operating System Software, memory manager, device drivers, configuration
     scripts, e-mail, productivity tools, etc.) A Desktop PC may have Standard
     or Non-Standard Equipment or Software.

bb   [...***...]

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     [...***...].

cc   DISASTER RECOVERY PLAN shall mean a PacifiCare or Supplier-developed and
     PacifiCare-approved plan (developed and maintained with appropriate
     PacifiCare-provided input) to perform Disaster Recovery. [NOTE: TO BE
     CONFORMED TO THE AGREEMENT AND SCHEDULE 16.1.]

dd   DISASTER RECOVERY shall mean the ability to recover those services
     designated as Critical Services by PacifiCare within PacifiCare specified
     time frames and sequences specified by PacifiCare (when changes to existing
     plans are required such changes shall be processed through the Change
     Management Procedure) via the use of an off-Campus recovery capability
     provided by Supplier or other facility provided by PacifiCare.

ee   DOCUMENTATION shall mean the user manuals and any other completed (as
     opposed to works in progress) materials in any form or medium related to
     the Services provided by Supplier to PacifiCare Entities as required by the
     Agreement or, provided by PacifiCare to Supplier (to the extent such
     materials exist, PacifiCare is aware of the existence, PacifiCare has
     reasonable access to the materials and PacifiCare has legal authority to
     access and provide such materials to an outsourcing company of the related
     Services).

ff   DOWNTIME shall mean the time that a particular System, Application,
     Product, Software, Equipment or any other part of the Services is not
     available during the Measurement Window as specified in this Schedule, for
     normal business use by the End-User.

gg   ENHANCEMENT - Any approved effort required to meet standards for
     Application availability, to provide adequate performance of the PacifiCare
     Software, and to enhance PacifiCare Software as required and necessary to
     accommodate the evolution of PacifiCare Entities' environments and
     `business requirements, Supplier shall develop, test and introduce changes
     to the PacifiCare Software that modify or add functionality to existing
     Applications.

hh   EQUIPMENT REPAIR CALL shall mean a call by an End-User notifying the Help
     Desk of degradation in functionality or performance for Equipment.
     Equipment Repair Calls shall not include calls relating to degradation in
     performance resulting from problems other than the Equipment or Software
     (such as Network problems), provided that if Supplier mistakenly diagnoses
     a problem as something other than Equipment or Software, and such diagnosis
     is wrong, and the problem is actually Equipment-related or
     Software-related, such call shall be counted as a Equipment Repair Call at
     the time such call was originally made.

ii   EXCHANGE ACCOUNT shall mean shall mean a Microsoft Outlook email account
     created or maintained by the Supplier for an End User.

jj   EXISTING SYSTEM - Any PacifiCare Proprietary Systems as listed in Schedule
     14.2. (a) or Schedule 14.2(b) of the Agreement.

kk   FILE RESTORATION RECOVERY is defined in Section IV.I.5.

ll   FILE/PRINT SERVER shall mean a server [...***...] that is limited in
     function to storing end user data, acting as a repository for applications
     to be executed on the Workstation, and support

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     of attached printers.

mm   FINAL RESOLUTION is defined as the application meets the business
     requirements in place prior to the error that resulted in the call to the
     Help Desk, and the End-User that reported the problem has been contacted by
     the Help Desk representative and agrees that it has been resolved.

nn   FULL TIME PERSON OR ("FTP") [...***...].

oo   HELP DESK shall mean a Supplier-managed help desk function that provides
     reactive and proactive problem determination, resolution and /or tracking,
     as applicable, under the Agreement. The Help Desk functions with respect to
     Software or Equipment within Supplier's scope of responsibility.

pp   HELP DESK - SUPPLIER APPLICATIONS SUPPORT personnel shall mean those
     personnel and facilities through which Supplier shall Respond to all calls
     and contacts concerning ongoing production Applications Maintenance
     problems. Calls and contacts from End-Users shall come through the Help
     Desk.

qq   HELP DESK SPEED OF ANSWER AFTER AUTOMATED MENU SELECTION shall mean the
     time between the caller's selection of the option on the Help Desk voice
     response unit's menu that leads to a live person and the time that a live
     person answers ready to start working on the Call.

rr   HIGH OR CRITICAL-RISK VIRUS shall mean a Virus reported often or very often
     in the field that has a payload that can cause serious damage which can
     spread rapidly on common operating systems using a common platform. If the
     Virus causes very serious damage, high risk might be assigned even with a
     lower level of prevalence.

ss   ID CARDS are cards issued to members identifying key member data.

tt   IMAC is defined in Schedule 17 to the Agreement, the Fee Schedule.

uu   IS CUSTOMER SATISFACTION SUMMARY shall mean of survey of End-Users opinions
     regarding the services provided.

vv   IT shall mean Information Technology.

ww   LAN SEGMENT AVAILABILITY is defined in Section II.G.

xx   LAN SEGMENT shall mean a separate PacifiCare infrastructure that connects
     desktop and workstation computers to server resources within a building or
     Campus environment including the management of switches, hubs, DNS servers,
     DHCP servers, IMAC requests, and connectivity up to the LAN port of the
     Wide Area Network (Wan) access router, but excludes PCs, the installation
     or repair of the building and Campus wiring plan, and any international
     locations.

yy   LAPTOP PC shall mean an End-User Laptop PC configuration, including
     Standard Equipment (e.g.,

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     docking station, monitor, PCMCIA modem, keyboard, CPU, mouse, peripherals,
     printers, plotters, video adapters, etc.), core system and user Software
     (e.g., Operating System Software, memory manager, device drivers,
     configuration scripts, e-mail, productivity tools, etc.). A Laptop PC may
     have Standard or Non-Standard Equipment or Software.

zz     LOCAL AREA NETWORK (LAN) shall mean a data network (typically within a
       building or Campus), which utilizes one of several data protocols and to
       which Equipment, such as PCs and printers, is attached such that
       End-Users can access or share Equipment and other resources.

aaa    LOOPING / RUNAWAY PROCESS is a process that has lost communication with
       it's control mechanism. Without a control mechanism, the process
       continues to execute.

bbb    MAIL, for IDC Critical Output purposes, is defined as the completion of a
       post-print processing function. Post-print processing may be automated or
       manual, may include collation, insertion, verification, and/or Quality
       Control. Stated time commitments for mail exclude weekends and holidays.

ccc    MEASURED BACKUP shall mean a Backup of applicable Data files and Software
       for a Measured System during the Scheduled Backup Window that includes
       the completion of the following:

              -   For applications, jobs that Backup application Data files,
                  Software and databases according to the Application Disaster
                  Recovery Plan or other agreed upon Documentation for the
                  Application.

              -   For infrastructure Components used in connection with an
                  Application, jobs that Backup operating systems, Software and
                  user data (where appropriate).

              -   For cases in which technology solutions or methodologies
                  selected do not execute a full Backup (e.g., ADSM),
                  incremental or revisional Backups.

              -   For the avoidance of doubt, in no event shall the Measured
                  Backups occur less frequently than current practice (as of the
                  Cutover Date) between PacifiCare and Supplier or as required
                  in any existing Agreement(s).

ddd    MEASURED IMAC REQUEST shall mean a completed and approved request for an
       IMAC that is submitted to Supplier through the Supplier Service Request
       Management System and is related to the Services. [...***...].

eee    MEASURED PROJECT shall mean any project which PacifiCare requires to be
       measured by Supplier.

fff    MODULE shall mean a separately defined Software Component of a Sub-system
       where similar functions generally are contained within the same unit of
       programming code and separate functions generally are developed as
       separate units of code.

ggg    NETWORK shall mean the telecommunications circuits, and the LAN/WAN
       equipment supporting these circuits, between the End-User's Desktop PC,
       Laptop PC, Windows Terminal, the

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       PacifiCare Site Equipment, and the Supplier Data Center Equipment.

hhh    NEW SERVICES are defined in Section 5.1 of the Agreement

iii    NON-STANDARD shall mean that Equipment or Software that has not been
       approved by PacifiCare as Standard.

jjj    ONLINE HOURS shall means all hours within a daily 24-hour period minus
       the Batch Window and Schedule Downtime. Online hours shall mean that
       period of time (days of the week and hours per day) during which a
       particular System, Application, Software, Equipment or any other part of
       the Services is expected to be available to PacifiCare Entities for
       normal business use.

kkk    OPERATING SYSTEM SOFTWARE shall mean the Software control program in a
       CPU that provides the interface to the CPU and its associated Equipment,
       and the usage and allocation of memory resources, processor resources,
       input/output resources, and security resources.

lll    PACIFICARE APPROVED REQUEST shall mean a PacifiCare request that is
       formatted properly in accordance with the then current format that has
       been approved by the PacifiCare Contract PC shall mean an End-User
       personal computer or Workstation forming a part of the Hardware including
       all PacifiCare specified Software installed thereon, and all PacifiCare
       specified Hardware attached or connected thereto (including display
       monitors, keyboards, mice and printers, but excluding non-office Hardware
       e.g., robotics, environmental control devices, etc.), and all PacifiCare
       funded network attachments, provided, however, any PacifiCare specified
       Hardware item connected with more than one personal computer or
       Workstation shall be deemed to be a part of only one personal computer as
       selected by PacifiCare in its discretion. A PC may have Standard or
       Non-Standard Hardware or Software.

mmm    PACIFICARE SERVICE LOCATIONS shall mean any PacifiCare service location
       set forth in Schedule 10.1 and any other service location owned or leased
       by PacifiCare from which Supplier has been authorized by PacifiCare to
       provide the Services.

nnn    PASSWORD RESET shall mean using appropriate Software commands to restore
       a Password to usable status.

ooo    PASSWORD shall mean a code identified with an End-User to enable access
       to PacifiCare Entities' Systems.

ppp    PC AND LAPTOP SYSTEMS REPAIR CALL shall mean a call by an End-User
       notifying the Help Desk of degradation in functionality or performance
       for a PC or Laptop. This includes End-Users working from a Home Office
       reporting degradation in functionality or performance for a Home PC.

       [...***...].

qqq    PC shall mean an End-User personal computer or Workstation forming a part
       of the Equipment including all PacifiCare specified Software installed
       thereon, and all PacifiCare specified Equipment attached or connected
       thereto (including display monitors, keyboards, mice and

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       printers, but excluding non-office Equipment e.g., robotics,
       environmental control devices, etc.), and all PacifiCare funded Network
       attachments, provided, however, any PacifiCare specified Equipment item
       connected with more than one personal computer or Workstation shall be
       deemed to be a part of only one personal computer as selected by
       PacifiCare in its discretion. A PC may have Standard or Non-Standard
       Equipment or Software.

rrr    PLAN COMPLIANCE CRITERIA is defined in Section IV.I.1.

sss    PRESCRIPTION SOLUTIONS CLAIMS REPORTS AKA - RX CLAIMS REPORTS - Are
       reports created from PacifiCare's Prescription Solutions specialty
       product company and printed on their behalf.

ttt    PRODUCT shall mean any Equipment, Software or supply item provided by
       Supplier or PacifiCare pursuant to the Agreement.

uuu    REGIONAL CUSTOMER SERVICES CENTERS (RCSCS) - which include the following
       business functions: Customer Services; Claims; Membership Accounting;
       Medical/Clinical Management; Regional Information Services; Provider
       Network Management; and Selected PacifiCare Executives and Executive
       Associates.

vvv    REMOTE ACCESS ACCOUNT shall mean those accounts requiring access from
       remote location via remote access technology such as RAS or VPN.

www    REMOTE shall mean an End-User not on a Campus location.

xxx    REPAIR CALL shall mean a call by an End-User notifying the Help Desk of
       degradation in functionality or performance in Equipment or System.

       [...***...].

yyy    RESPOND shall mean notification may be via telephone or in person to the
       End User when the End-User reports a problem to Help Desk.

zzz    RESPONSE TIME shall be the value at the [...***...] percentile of a
       series of end-to-end measurements using the agreed-to tools, which are
       used to assess the processing speed of an Application's operation within
       the environment.

aaaa   SCHEDULED BACKUP WINDOW shall mean the scheduled time to complete Backups
       of Applications and infrastructure Components according to the agreed
       upon Documentation for the Application or infrastructure Components.

bbbb   SCHEDULED BATCH JOB shall mean a sequence of computer programs that are
       assigned/sent to a

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       computer to run without further user interaction and are scheduled, in
       connection with the Services, by an End-User or Supplier to run
       automatically at a certain time.

cccc   SCHEDULED DOWNTIME of a particular System, Application, element of
       hardware, network or any other part of the Services shall mean the amount
       of time that a particular System, Application, element of hardware,
       network or any other part of the Services is not available for normal
       business use by the End-User that has been agreed to in advance by
       PacifiCare (e.g. planned schedule maintenance activities). The Parties
       intend to schedule such time so as to minimize the impact to PacifiCare
       Entities' business operations. Supplier shall maintain Availability
       during such periods to the extent reasonably practicable.

dddd   SERVICE MEASUREMENT a measurement of service based on the report
       frequency established in SLA-1 of the Schedule 8.

eeee   SERVICE REQUEST shall mean a PacifiCare Approved Request that Supplier is
       responsible for logging and tracking, including via a service management
       tool (including Tivoli Service Desk and Help Now!).

ffff   SEVERITY LEVEL assigned to a particular problem shall mean the value 0,
       1, 2, 3 or 4 determined by the Infrastructure Supplier Help Desk
       technician when a problem occurs by referring to the following table:

<TABLE>
<CAPTION>
       LEVEL                    DESCRIPTION              STATUS UPDATE/ TARGET      RESPONSIBLE GROUP
                                                              RESOLUTION            STATUS REPORTING
-----------------------------------------------------------------------------------------------------
<S>                      <C>                             <C>                        <C>
Severity 0               COMPANY AND OR ENTERPRISE -     [...***...].               [...***...].
[...***...]            WIDE

                                                         STATUS UPDATE
                         [...***...].

                                                         [...***...].

                                                         TARGET RESOLUTION

                                                         [...***...].

-----------------------------------------------------------------------------------------------------

Severity 1               MAJOR OPERATIONAL IMPACT        [...***...].               [...***...].
                         WITH NO WORKAROUND
                         AVAILABLE
                                                         STATUS UPDATE

                         [...***...].
                                                         [...***...].

-----------------------------------------------------------------------------------------------------
</TABLE>

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<TABLE>
<CAPTION>
       LEVEL                    DESCRIPTION              STATUS UPDATE/ TARGET      RESPONSIBLE GROUP
                                                              RESOLUTION            STATUS REPORTING
-----------------------------------------------------------------------------------------------------
<S>                      <C>                             <C>                        <C>
                         [...***...].                    [...***...].               [...***...].

                                                         TARGET RESOLUTION

                                                         [...***...].

-----------------------------------------------------------------------------------------------------

Severity 2               MAJOR OPERATIONAL IMPACT-       TARGET STATUS              [...***...].
                         PRE-EXISTING WORKAROUND
                         IN PLACE.
                                                         [...***...].

                         [...***...].
                                                         TARGET RESOLUTION

                         EXAMPLE:  [...***...].
                                                         [...***...].

-----------------------------------------------------------------------------------------------------

Severity 3               -    Individual is Down and     TARGET STATUS              [...***...].
                              there is no work around

                                                         [...***...].
                         -    One individual customer
                              is unable to work within
                              an application.

-----------------------------------------------------------------------------------------------------
</TABLE>

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<TABLE>
<CAPTION>
       LEVEL                    DESCRIPTION              STATUS UPDATE/ TARGET      RESPONSIBLE GROUP
                                                              RESOLUTION            STATUS REPORTING
-----------------------------------------------------------------------------------------------------
<S>                      <C>                             <C>                        <C>
                         EXAMPLES:                       TARGET RESOLUTION

                         [...***...].                    [...***...].

-----------------------------------------------------------------------------------------------------

Severity 4               -    Individual is              TARGET STATUS              [...***...].
                              experiencing a
                              problem and a
                              workaround does exist      [...***...].

                         -    Individual has a           TARGET RESOLUTION:
                              non-urgent question
                              regarding application,
                              report or other IS         [...***...].
                              related assistance.

                         EXAMPLES:

                         [...***...].

-----------------------------------------------------------------------------------------------------
</TABLE>

gggg   SHIP, for IDC Critical Output purposes, is defined as print and bundle
       for distribution with no post-print processing function.

hhhh   STANDARD shall mean (collectively and individually) that hardware and
       Software that has been approved by the PacifiCare and certified by the
       SUPPLIER.

iiii   SUB-SYSTEM shall mean any collection or aggregation of one (1) or more
       Applications that are designed to perform, are performing, or capable of
       PERFORMING, in accordance with the applicable functional specifications
       (development only) and Statement of Work.

jjjj   SUPPLIER RE-TEST shall mean a re-test of the RECOVERABILITY of Critical
       Services required because of failed Disaster Recovery Milestones.

kkkk   SYSTEM AND APPLICATION LOGON ID shall mean a user id and password
       granting an End User access to any of PacifiCare's systems, applications
       or networks, as created and maintained by the Supplier.

llll   SYSTEM CRITICAL SCHEDULED UPTIME shall mean the AMOUNT of minutes within
       the applicable Measurement Window for the System as set forth in Service
       Level Attachment SLA-1.

mmmm   SYSTEM DOWNTIME shall mean the total time per calendar month out of the
       System Critical Scheduled Uptime, as measured in minutes, that the System
       for which Availability is being computed is not Available for Use.

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nnnn   SYSTEM shall mean any collection or aggregation of two (2) or more
       Products that are designed to perform, or are represented by Supplier as
       performing or being capable of performing, as a functional entity.

oooo   SYSTEM SOFTWARE shall mean those programs, including Documentation and
       materials, that perform tasks basic to the functioning of the Equipment
       and which are required to operate the Application or otherwise support
       the provision of Services by Supplier. Systems Software includes
       Operating Systems Software and systems utilities.

pppp   TIME TO RESOLVE shall mean the elapsed time between registration of the
       problem to Supplier's Help Desk and the successful resolution (i.e.,
       repair or bypass, not escalation) of the problem as accepted by the
       End-User.

qqqq   TURNOVER shall mean each case in which a Supplier employee leaves the
       employ of Supplier in a voluntary / involuntary manner or otherwise
       ceases to provide support to PacifiCare Entities, except (i) in the case
       of death, disability, retirement or extended leave of the employee or,
       (ii) in the case that the employee ceases to provide support as a result
       of a planned reduction in force or, (iii) because the employee's position
       is eliminated due to the conclusion of a PacifiCare-specific work effort
       (e.g., at the conclusion of a project) or, (iv) the Services provided by
       the employee are determined not to be needed to provide the Services
       according to the Agreement and PacifiCare accepts Supplier's proposal to
       reduce the Supplier personnel.

rrrr   UNSCHEDULED DOWNTIME shall mean the time that a particular System,
       Application, element of hardware or any other part of the Services is not
       available for normal business use during the Batch Window or Online
       Hours. If the duration of unavailability for Scheduled Downtime event
       exceeds the agreed-to time interval for the event and extends into the
       Online Hours, the time unavailable which extends into the Online Hours
       shall be considered Unscheduled Downtime in the Application Availability
       calculation.

ssss   VIDEO CONFERENCE (VIDEO CONFERENCE SESSION) shall mean any scheduled
       meeting that involves at least two locations connected by
       telecommunications and involving video service provided from a full time,
       part time, or temporarily set up or rented room that has audio and video
       transmission capabilities.

tttt   VIDEO CONFERENCE ROOMS shall mean any room set up for and used regularly
       for Video Conference sessions even if the room may be used for other
       purposes when not in use for Video Conferences.

uuuu   VIDEO CONFERENCING RESERVATION SYSTEM shall mean the system used by
       End-Users to schedule Video Conference Sessions and Video Conference
       Rooms.

vvvv   WIDE AREA NETWORK (WAN) shall mean a collection of computers connected
       (or networked) to each other over a geographic area.

wwww   WINDOWS TERMINAL shall mean a windows desktop with limited or no local
       processing capability accessing the operating system and Applications via
       a link to a server running terminal server operating software.

xxxx   WORKSTATION shall mean a setup composed of a computer and peripheral
       devices that enable someone to do work.

                                 Page 51 of 51                 [PACIFICARE LOGO]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                   SCHEDULE 8

                      SERVICE LEVEL AGREEMENT ATTACHMENT 1

                              SERVICE LEVEL MATRIX

                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                   SCHEDULE 8

                      SERVICE LEVEL AGREEMENT ATTACHMENT 2

                         SERVICE LEVEL OUTCOME EXAMPLES

                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                   SCHEDULE 8

                      SERVICE LEVEL AGREEMENT ATTACHMENT 3

           PRE-APPROVED MEASURING TOOLS AND METHODOLOGIES FOR CRITICAL
                           SERVICE LEVEL MEASUREMENTS

                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                   SCHEDULE 8

                      SERVICE LEVEL AGREEMENT ATTACHMENT 4

                              APPLICATION SUMMARIES

                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                   SCHEDULE 8

                      SERVICE LEVEL AGREEMENT ATTACHMENT 5

                        DISASTER RECOVERY PROGRAM CHARTER

                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 8.7
<PAGE>
                                    AGREEMENT
                                     BETWEEN
                             PACIFICARE AND SUPPLIER

                                  SCHEDULE 8.7

                    SERVICE LEVELS APPLICABLE TO TERMINATION

INTRODUCTION

Failures to meet the Service Levels set forth below may result in termination of
the Agreement by PacifiCare as provided in Section 8.7 of the Agreement.

<TABLE>
<CAPTION>
         SLA SUBJECT TO SECTION 8.7                   MINIMUM SLA
         --------------------------                   -----------
<S>                                                   <C>
         1.       [...***...]                         [...***...]
         2.       [...***...]                         [...***...]
         3.       [...***...]                         [...***...]
         4.       [...***...]                         [...***...]
         5.       [...***...]                         [...***...]
         6.       [...***...]                         [...***...]
         7.       [...***...]                         [...***...]
         8.       [...***...]                         [...***...]
         9.       [...***...]                         [...***...]
         10.      [...***...]                         [...***...]

</TABLE>

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                SCHEDULE 9.2 (a)

                          APPROVED BENCHMARK PROVIDERS

1.        [...***...]
2.        [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 10.1

                               Service Locations

<TABLE>
<CAPTION>

        BUSINESS
 STATE    UNIT                                ADDRESS                                      PEOPLE      BREAKROOMS       AKA
---------------------------------------------------------------------------------------------------------------------------------
<S>       <C>     <C>                                      <C>                          <C>            <C>            <C>
  AZ
          PCAZ    410 N. 44th Street                        Phoenix, AZ 85008           [...***...]    [...***...]    [...***...]
          PCAZ    4601 E. Hilton Avenue                     Phoenix, AZ 85034           [...***...]    [...***...]    [...***...]
          PCAZ    6245 E. Broadway                          Tucson, AZ 85711            [...***...]    [...***...]    [...***...]
  CA
          PCCA    29219 Canwood St. #200                    Agoura Hills, CA 91301-     [...***...]    [...***...]
          PCDV    2099 S. State College                     Anaheim, CA 92806-          [...***...]    [...***...]
          PCDV    2099 S. State College                     Anaheim, CA 92806           [...***...]    [...***...]
          PCDV    2165 S. Dupont #G (Storage)               Anaheim, CA 92806           [...***...]
          RXSL    2858 Loker East                           Carlsbad, CA 92008-         [...***...]    [...***...]    [...***...]
          PCCA    2300 Clayton Road                         Concord, CA 92108           [...***...]    [...***...]
          RXSL    3515 Harbor Blvd.                         Costa Mesa, CA              [...***...]    [...***...]
          PHPA    3515 Harbor Blvd.                         Costa Mesa, CA 92626        [...***...]    [...***...]    [...***...]
          RXCN    3515 Harbor Blvd.                         Costa Mesa, CA 92626-       [...***...]    [...***...]
          PCCA    10700 Valley View                         Cypress, CA 90630           [...***...]    [...***...]    [...***...]
           PIS    10803 Hope Street                         Cypress, CA 90630           [...***...]    [...***...]    [...***...]
          PCCA    10833 Valley View                         Cypress, CA 90630           [...***...]    [...***...]    [...***...]
          PCCA    5701 Katella Avenue                       Cypress, CA 90630           [...***...]    [...***...]    [...***...]
          PCCA    5757 Plaza Drive (Parking)                Cypress, CA 90630           [...***...]
          PCCA    5995 Plaza Drive                          Cypress, CA 90630           [...***...]    [...***...]    [...***...]
           PIS    6100 Gateway                              Cypress, CA 90630           [...***...]    [...***...]    [...***...]
           PIS    6251 Katella                              Cypress, CA                 [...***...]    [...***...]    [...***...]
          PHPA    6330 Gateway Drive, Bldg A                Cypress, CA 90630           [...***...]    [...***...]    [...***...]
           PIS    6400 Gateway Drive, Bldg C                Cypress, CA 90630           [...***...]    [...***...]    [...***...]
          PCCA    325 East Sierra Ave                       Fresno, CA 93710            [...***...]    [...***...]
          PHPA    11642 Knott Ave  - Units 3 & 20           Garden Grove, CA 92841-     [...***...]    [...***...]    [...***...]
          PCCA    11642 Knott Ave  - Units 3 & 20           Garden Grove, CA 92841-     [...***...]    [...***...]    [...***...]
           ACD    17500 Redhill Avenue, Ste 220             Irvine, CA 92701-           [...***...]    [...***...]    [...***...]
          PBHI    23046 Avenida de la Carlota               Laguna Hills, CA 92653      [...***...]    [...***...]
          PBHI    23046 Avenida de la Carlota #300          Laguna Hills, CA
          PCCA    4961 Katella Avenue (Parking)             Los Alamitos, CA 90720-     [...***...]    [...***...]    [...***...]
          PCCA    3280 E. Foothill Blvd                     Pasadena, CA 91107          [...***...]    [...***...]
          PCCA    3400 Central Avenue                       Riverside, CA 92506         [...***...]    [...***...]
          PCCA    2180 Harvard Street                       Sacramento, CA 95815        [...***...]    [...***...]
          PCCA    4365 Executive Drive                      San Diego, CA 92121         [...***...]    [...***...]
          RXSL    9401 Waples Street, Suite 120             San Diego, CA 92121         [...***...]    [...***...]
          PCCA    2077 Gateway Place                        San Jose, CA 95110          [...***...]    [...***...]
</TABLE>

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
<TABLE>
<S>       <C>     <C>                                       <C>                         <C>            <C>            <C>
          LIFE    3100 Lake Center Drive                    Santa Ana, CA 92401-        [...***...]    [...***...]
          PHPA    3100,3110,3120 Lake Center Dr             Santa Ana, CA 92704         [...***...]    [...***...]
          PBHI    5990 Sepulveda Blvd                       Van Nuys, CA 91411          [...***...]    [...***...]
                                                            West Los Angeles, CA
          PCCA    3415 S. Sepulveda Blvd, Ste 800           90034                       [...***...]    [...***...]
  CO
                                                            Colorado Springs, CO
          PCCO    5755 Mark Dabling Blvd                    80919                       [...***...]    [...***...]    [...***...]
          PBHI    6455 S. Yosemite                          Englewood, CO               [...***...]    [...***...]
          PCCO    6455 S. Yosemite                          Englewood, CO 80111         [...***...]    [...***...]    [...***...]
          PCCO    6455 S. Yosemite, Suite 800               Englewood, CO 80111-        [...***...]    [...***...]
          PCCO    3030 South College, Ste 100               Fort Collins, CO 80525      [...***...]    [...***...]
  GU
          GUAM    759 South 759 Marine Drive (CenTam Admn)  Dededo, GU 96911-           [...***...]
          GUAM    Blessco Warehouse                         Dededo, GU                  [...***...]    [...***...]
          GUAM    Hafa Adai Theatre Parking                 Dededo, GU                  [...***...]    [...***...]    [...***...]
          GUAM    231 Guerrero Street                       Tamuning, GU 96911-         [...***...]                   [...***...]
          GUAM    548 South Marine Drive (Med. Center)      Tamuning, GU 96911-         [...***...]
          GUAM    548 South Marine Drive (Parking)          Tamuning, GU                [...***...]
          GUAM    761 South Marine Drive (Annex)            Tamuning, GU                [...***...]
          GUAM    EMI Warehouse #3, Unit D                  Tamuning, GU                [...***...]    [...***...]    [...***...]
          GUAM    Lot 6, Blk 6, E T Calvo Memorial Pkway    Tamuning, GU                [...***...]    [...***...]    [...***...]
  IR
          PLIC    Letterkenney Bus. Park, Lisenan           Letterkenney, IR            [...***...]    [...***...]
  NV
          PCNV    3941 E. Sunset (Storage)                  Las Vegas, NV 89119         [...***...]
          PCNV    700 Warm Springs Road                     Las Vegas, NV 89119         [...***...]    [...***...]
  OK
          PCOK    525 Central Park Drive                    Oklahoma City, OK 73105     [...***...]    [...***...]
          PCOK    7766 E. 61st Street, Suite 500            Tulsa, OK 74133             [...***...]    [...***...]
  OR
          PCOR    20510 N.W. Evergreen Pkwy                 Hillsboro, OR 97124         [...***...]    [...***...]    [...***...]
          PBHI    20510 N.W. Evergreen Pkwy                 Hillsboro, OR 97124-        [...***...]
          PCOR    Five Centerpointe Drive                   Lake Oswego, OR 97035       [...***...]    [...***...]    [...***...]
  SP
          GUAM    211 Oleai Business Ctr                    San Jose, SP 96950-         [...***...]                   [...***...]
  TX
          PCTX    611 Ryan Plaza Drive                      Arlington, TX 76011-        [...***...]    [...***...]    [...***...]
           COV    12401 Research Blvd.,   Bldg 1, #210      Austin, TX 78759-           [...***...]    [...***...]    [...***...]
          PCTX    14205 Burnet Road, Suite 360              Austin, TX 78728-           [...***...]    [...***...]
          PCTX    5001 LBJ Freeway,Sts 400, 500, 600        Dallas, TX 75244            [...***...]    [...***...]
          PBHI    5001 LBJ Freeway,Suites 500 & 600         Dallas, TX                  [...***...]    [...***...]
</TABLE>

                                             * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
<TABLE>
<S>       <C>     <C>                                     <C>                         <C>            <C>            <C>
          PCTX    1800 West Loop South, Ste 350           Houston, TX 77027           [...***...]    [...***...]
                                                          San Antonio, TX
          PCTX    6200 Northwest Parkway                  78249-3348                  [...***...]    [...***...]    [...***...]
          PCTX    8200 IH 10 West, Ste 1000               San Antonio, TX 78230       [...***...]    [...***...]    [...***...]
  WA
          PCWA    2511 Colby Ave.                         Everett, WA 98201           [...***...]    [...***...]
          PCWA    4313 6TH Avenue S. E.                   Lacey, WA 98503-            [...***...]    [...***...]    [...***...]
          PCWA    7525 S.E. 24th                          Mercer Island, WA 98040     [...***...]    [...***...]
</TABLE>

<TABLE>
<CAPTION>
                  Group                     State   City             Address
--------------------------------------------------------------------------------
<S>                                         <C>     <C>              <C>
[...***...]
                                             CO     Englewood        333 S. Inverness
                                             TX     San Antonio      1303 McCullough Ave
                                             TX     San Antonio      13909 Nacogdoches
                                             TX     San Antonio      1402 S.W. Military
                                             TX     San Antonio      315 North San Saba

[...***...]
                                             CA     Cypress          5757 Plaza Drive
                                             IR     Letterkenny

[...***...]
                                             CA     Santa Barbara    351 Paseo Nuevo
                                             CO     Englewood        7887 Belleview, Suite 200
                                             CO     Englewood        7887 Belleview, Suite 325
                                             SP     Saipan           Chalan Kiya Circle Apt A-1
</TABLE>

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 10.2

                         SAFETY AND SECURITY PROCEDURES

The PacifiCare Safety and Security Procedures can be found via pull-down menus
at the following URL on PacifiCare's intranet:

[...***...]

                                             * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                   SCHEDULE 11

                                 HUMAN RESOURCES

         For purposes of this Schedule 11 (this "Schedule"), all capitalized
terms not otherwise defined herein shall have the meanings ascribed to them in
the Agreement

1.       Employment Offers. Supplier shall extend offers of employment according
         to the terms of this Schedule and in accordance with the procedures
         described in this Schedule to those PacifiCare employees set forth in
         Exhibit A hereto (collectively, the "Affected Employees"; each, an
         "Affected Employee"). [...***...]

2.       Hiring Requirements.  Supplier shall hire those Affected Employees who:

                  (1)      are listed in Exhibit A hereto;

                  (2)      [...***...]

                  (3)      [...***...]

         [...***...].

3.       Terms of Employment. Supplier's offer of employment to each Affected
         Employee shall include the following:

                  (1)      Base Salary. [...***...].

                  (2)      Positions. [...***...]

                                          1. * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                  [...***...].

                  (3)      Work Hours. [...***...].

                  (4)      Health Care Benefits and Employee Benefit Plans.
                           [...***...].

                  (5)      Vacation. [...***...].

                  (6)      Savings Plans. [...***...].

                  (7)      Length of Service Credit. [...***...].

                  (8)      Adjustments Related to Benefit Plans. [...***...]

                                          2. * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                           [...***...].

                  (9)      Tuition Aid. [...***...].

                  (10)     Location. [...***...].

                  (11)     Bonuses/Compensation Programs.

                           (a)      [...***...].

                           (b)      [...***...].

                  (12)     [...***...].

4.       Severance Benefits.

                  (1)      [...***...]

                                          3. * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                           [...***...].

                  (2)      [...***...].

5.       Financial and Administrative Responsibilities After Effective Date
         and Prior to Cutover Date.

                  (1)      [...***...].

                  (2)      [...***...].

                  (3)      [...***...].

                  (4)      [...***...].

6.       Human Resources Representative. [...***...].

                                          4. * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
7.       Conditions for Working on PacifiCare Accounts.

                  (1)      Supplier agrees to [...***...].

                  (2)      Supplier shall be responsible for [...***...].

                  (3)      Supplier will implement an employee training program
                           that will complement, further develop and maintain
                           the requisite skills and technical knowledge of
                           Supplier personnel assigned to the PacifiCare account
                           in anticipation of PacifiCare's needs for the
                           products and services in its business units.
                           [...***...]:

                           a.       [...***...].
                           b.       [...***...].
                           c.       [...***...].
                           d.       [...***...].

8.       Conditions for Rehire.  [...***...].

                                          5. * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                    EXHIBIT A

                               AFFECTED EMPLOYEES

NAME

POSITION

BASE SALARY

SHIFT

AMOUNT OF SIGN ON BONUS

AUTOMOBILE ALLOWANCE

FLEX PLAN ALLOWANCE

RELOCATION PACKAGE
<PAGE>
                                    EXHIBIT B

                          RELEASE AND WAIVER OF CLAIMS

          [TO BE EXECUTED UPON TERMINATION OF EMPLOYMENT WITH SUPPLIER]

         I understand that my last day of employment with International Business
Machines Corp. ("Supplier") will be ______________. In exchange for and in
consideration of the promises and covenants stated in this Release and Waiver
("Release and Waiver") , [...***...].

         [...***...].

                                          1. * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
[...***...].

         This Release and Waiver constitute the complete, final and exclusive
embodiment of the entire agreement between PacifiCare and me and the Supplier
and me with regard to the subject matter hereof. I am not relying on any promise
or representation by PacifiCare or the Supplier that is not expressly stated
herein. This Release and Waiver may only be modified by a writing signed by both
me and a duly authorized officer of PacifiCare and the Supplier.

Date: __________________                 By:_________________________________
                                             [EMPLOYEE]

                                          2. * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                   EXHIBIT B-1

            DISCLOSURE UNDER TITLE 29 U.S. CODE SECTION 626(F)(1)(H)

CONFIDENTIALITY PROVISION:      The information contained in this document
                                is private and confidential.  You may not
                                disclose this information to anyone except your
                                professional advisors.

1.       The following departments have been selected for the severance package
         program:

         a.
                  ----------------------------
         b.
                  ----------------------------
         [ADD MORE IF NECESSARY]

2.       In the [two] departments listed above, employees whose job positions
         will be eliminated on [DATE OF TERMINATION] are eligible to participate
         in the severance package program.

3.       An eligible employee will have up to forty-five (45) days to review the
         terms and conditions of the severance package.

<TABLE>
<CAPTION>
              EMPLOYEES ELIGIBLE FOR THE SEVERANCE PACKAGE PROGRAM
       JOB TITLE                                                AGE
<S>                                                  <C>

</TABLE>

                                       1.
<PAGE>
<TABLE>
<CAPTION>
            EMPLOYEES NOT ELIGIBLE FOR THE SEVERANCE PACKAGE PROGRAM
JOB CLASSIFICATION/ORGANIZATION UNIT                          AGE
<S>                                                  <C>

</TABLE>

                                       2.
<PAGE>
                                  SCHEDULE 12.2

                                  KEY PERSONNEL

For confidentiality purposes, the information in this schedule will only be
accessible to the PacifiCare Supplier Relationship Vice President, the IBM
Account Executive, and other personnel (e.g., Human Resources, Legal, etc.) as
deemed necessary.

[...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 12.4

                             APPROVED SUBCONTRACTORS

INTRODUCTION

This Schedule defines the Supplier Subcontractors that are approved by
PacifiCare for use in performing the Services. Approved Subcontractors shall
also include those subcontractors performing work for PacifiCare as of the
Effective Date including the Assigned Agreement subcontractors.

APPROVED SUBCONTRACTORS

         [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 13.2

                        Oversight and Management Process

                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 13.3
<PAGE>
                                  INITIAL DRAFT
                               IBM GLOBAL SERVICES
                                    AGREEMENT
                                     BETWEEN
                               PACIFICARE AND IBM

                                  SCHEDULE 13.3

                 POLICY AND PROCEDURES MANUAL TABLE OF CONTENTS

INTRODUCTION

This Schedule defines the table of contents that will evolve into the Policy and
Procedures Manual to be developed during Transition.

POLICY AND PROCEDURES MANUAL TABLE OF CONTENTS

*Document Control (How to execute changes to policies and procedures guide)

*Document Overview (High level overview of manual 's content)

*Services Overview (High level contract overview)

Process Specifications

         *Change Management

         *Control Backup and Recovery

         Control Batch Operations

         Control Capacity

         Control Inventory

         *Control IT Security

         *Control Service Levels

         Control Tape Operations

         Coordinate IMACs

         *Application Delivery

                  Application Management and Support Operations

            AM Support Services

         *Handle Customer Satisfaction

         Handle Entitlement Failure

         Handle Inventory Logistics

         Handle Procurement

         *Handle User Requests

                                       1.
<PAGE>
         Network Services

         *Perform Escalation

         Perform User Administration

         *Perform Asset Inventory

         *Problem Management

         *Provide Request Status

         *Reassign Request

         *Situation Management

         Support Desktop

         Support Hardware Facilities

         *Support Performance

         *Support Software

         *Track Inventory

         *Update Configuration Information

*Acronyms

INDEX

Note:

-    This table of contents is representative of the topics that need to be
     included in the Policies and Procedures Manual. PacifiCare and IBM/Keane
     will agree on the final version of the document. These Policies and
     Procedures will address where the client and supplier need to interface.

-    This Policy and Procedures Manual will be a comprehensive document and
     refer to other relevant policies and procedures by name or location of the
     living document as they are updated over time.

-    It is not necessary to modify this Schedule via a contract amendment if the
     Table of Contents change in the draft or final document.

-    The sections where Keane will provide information are indicated with an
     "*". The Application Delivery Section is provided solely by Keane while the
     remaining sections are IBM's responsibility with Keane contributing to
     reviewing content. This will be true for the version of Schedule 13.3 that
     will be attached to the Keane and PacifiCare Agreement.

                                       2.
<PAGE>
                                SCHEDULE 14.2(a)

                         PACIFICARE PROPRIETARY SOFTWARE

INTRODUCTION

This Schedule lists the PacifiCare Proprietary Software as defined in Exhibit A
of the Agreement.

PACIFICARE PROPRIETARY SOFTWARE

           PROPRIETARY SOFTWARE NAME

[...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                SCHEDULE 14.2(b)

                         PACIFICARE THIRD PARTY SOFTWARE

<TABLE>
<CAPTION>
             SUPPLIER                                   DESCRIPTION
---------------------------------        --------------------------------------
<S>                                                     <C>
           [...***...]                                  [...***...]

</TABLE>

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 14.3

                                SUPPLIER SOFTWARE

INTRODUCTION

This Schedule lists the Software.

SUPPLIER SOFTWARE

<TABLE>
<CAPTION>
Item #     Vendor        Application Name and Description     Financial Responsibility   Operational Responsibility
-----------------------------------------------------------------------------------------------------------------
<S>       <C>            <C>                                  <C>                         <C>
   1      [...***...]    [...***...]                                        Supplier                    Supplier
   2      [...***...]    [...***...]                                        Supplier                    Supplier
   3      [...***...]    [...***...]                                        Supplier                    Supplier
   4      [...***...]    [...***...]                                        Supplier                    Supplier
   5      [...***...]    [...***...]                                        Supplier                    Supplier
   6      [...***...]    [...***...]                                        Supplier                    Supplier
   7      [...***...]    [...***...]                                        Supplier                    Supplier
   8      [...***...]    [...***...]                                        Supplier                    Supplier
   9      [...***...]    [...***...]                                        Supplier                    Supplier
  10      [...***...]    [...***...]                                        Supplier                    Supplier
  11      [...***...]    [...***...]                                        Supplier                    Supplier
  12      [...***...]    [...***...]                                        Supplier                    Supplier
  13      [...***...]    [...***...]                                        Supplier                    Supplier
  14      [...***...]    [...***...]                                        Supplier                    Supplier
  15      [...***...]    [...***...]                                        Supplier                    Supplier
  16      [...***...]    [...***...]                                        Supplier                    Supplier
  17      [...***...]    [...***...]                                        Supplier                    Supplier
  18      [...***...]    [...***...]                                        Supplier                    Supplier
  19      [...***...]    [...***...]                                        Supplier                    Supplier
</TABLE>

[...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 16.1

                                CRITICAL SERVICES

APPLICATION:                                   RECOVERY
-----------
                                               TIME-FRAME
                                               -----------------------------

[...***...]                                  [...***...]

CUSTOMER SUPPORT SYSTEMS:                    APPLICATION RUNNING IN REGION
------------------------                     -------------------------------

[...***...]                                  [...***...]     [...***...]

LIMITATIONS.  [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                   SCHEDULE 17
<PAGE>
                    INFORMATION TECHNOLOGY SERVICES AGREEMENT
                                     BETWEEN
                        PACIFICARE HEALTH SYSTEMS AND IBM

                                  FEE SCHEDULE

                                   SCHEDULE 17

                                       1.
<PAGE>
This schedule describes the methodology for calculating the Fees. In the event
of any conflict, confusion or ambiguity between this Schedule and the Agreement,
the Agreement shall control.

ATTACHMENTS

The following Attachments are attached hereto and are hereby incorporated by
reference:

Attachment 17.1   Fees

Attachment 17.2   Resource Unit Rates

Attachment 17.3   Resource Unit Descriptions

Attachment 17.4   Resource Unit Baselines

Attachment 17.5   Early Termination Fees

Attachment 17.6   Retained Contractors

Attachment 17.7   Funds Transfer Information

Attachment 17.8   Rates for Application Project Services

Attachment 17.9   Wire Instructions for Asset Charges

1.       DEFINITIONS

         Terms used herein with initial capital letters shall have the
respective meanings set forth in the Agreement, or, for those terms that are not
defined in the Agreement, the meanings set forth in this Schedule.

         1.1 "ACTUAL RESOURCE UNITS" has the meaning set forth in Section 4.3(a)
(Calculation of ARCs for Resource Units) of this Schedule.

         1.2 "ADD" has the meaning set forth in Section 5.2(a)(iii) (Install,
Move, Add, and Change Services) of Attachment 17.3 to this Schedule.

         1.3 "ARC(S)" or "ADDITIONAL RESOURCE CHARGE(S)" is defined in the
Agreement.

         1.4 "ARC DEADBAND" means the percentage above the Baseline within which
ARCs will not apply but, when exceeded, ARCs will apply. Each Resource Unit has
an ARC Deadband associated with it, as set forth in Section 4.3(a)(i) below.

         1.5 "ARC DEADBAND BASELINE" has the meaning set forth in Section 4.3(a)
(Calculation of ARCs for Resource Units) of this Schedule.

         1.6 "ARC RATE" means the per Resource Unit rate at which PacifiCare is
charged for use of additional resources.

                                       2.
<PAGE>
         1.7 "BASELINE" means the quantity of a particular Resource Unit that
constitutes the volume of that Resource Unit included in the Base Fees. The
parties have established the initial Baselines for each Resource Unit as of the
Effective Date, which are described in Attachment 17.3 to this Schedule and
enumerated in Attachment 17.4 to this Schedule. Baselines may be adjusted during
the Term pursuant to the processes established in the Agreement.

         1.8 "CALLS" has the meaning set forth in Section 6.2(e) below of
Attachment 17.3 to this Schedule.

         1.9 "CHANGE SERVICE" has the meaning set forth in Section 5.2(a)(4)
(Install, Move, Add, and Change Services) of Attachment 17.3 to this Schedule.

         1.10 "CONSUMABLES" mean items used in the normal course of business
(including the IDC Tower) at the PacifiCare Service Locations, through the
utilization of information technology resources, including, for example, paper,
toner, printer cartridges, diskettes, compact disks, tapes, batteries, and other
such consumable items that comply with original equipment manufacturer
specifications. Other than as stated above, Consumables do not include office
supplies, hard disks or other capital equipment.

         1.11 "CPI-U" has the meaning set forth in Section 11.1(b) below.

         1.12 "ECA FACTOR" has the meaning set forth in Section 11.1(a) below.

         1.13 "ECONOMIC CHANGE ADJUSTMENT" or "ECA" has the meaning set forth in
Section 11.1(a) below.

         1.14 "FTP" is defined in Schedule 8 to the Agreement (Service Level
Schedule).

         1.15 "INSTALL, MOVE, ADD, CHANGE SERVICE" and "IMAC" means Install,
Move, Add, Change Service events as set forth in Section 5.2 (Install, Move,
Add, and Change Services) of Attachment 17.3 to this Schedule.

         1.16 "INSTALL" has the meaning set forth in Section 5.2(a)(i) (Install,
Move, Add, and Change Services) of Attachment 17.3 to this Schedule.

         1.17 "MOVE" has the meaning set forth in Section 5.2(a)(ii) (Install,
Move, Add, and Change Services) of Attachment 17.3 to this Schedule.

         1.18 "PERIPHERALS" is defined in the Statement of Work.

         1.19 "PROJECT" means projects performed by Supplier at PacifiCare's
request, which projects are included in the Base Services to the extent that 1)
the Supplier can perform such projects using the skills of the Project Staff,
including skills related to the examples set forth below, and 2) the aggregate
amount of resources (measured in FTPs) required to perform such projects
underway at any given time does not exceed the aggregate amount of resources
(measured in FTPs) allotted for Projects as described in Attachment 17.3 to this
Schedule and enumerated in Attachment 17.4 to this Schedule. To the extent any
Project requires skills different from the skills referenced above in this
paragraph, or to the extent any Project requires

                                       3.
<PAGE>
more resources (measured in FTPs) than are allotted for Projects at that time,
the Parties will agree on the fees applicable to the provision of such different
skills and/or additional resources prior to commencing work on such Project. The
scope of work for each Project and the fees described in the immediately
preceding sentence, if any, for each Project will be set forth in a project plan
in a form to be mutually agreed to by the parties. The terms and conditions of
the Agreement will apply to all Projects, except to the extent expressly amended
by the applicable project plan. The following list includes examples of
Projects:

                  -        PacifiCare-requested upgrades impacting schedules set
                           forth in the Statement of Work, the Agreement or as
                           approved by PacifiCare;

                  -        Extension of network to a new building or location
                           not currently occupied by PacifiCare;

                  -        PacifiCare-requested support that is outside the
                           scope of the Statement of Work and not inherent to
                           the Base Services;

                  -        Any new pilot and proof-of-concept activity;

                  -        Any work by the IDC "programming group" that exceeds
                           eight (8) FTPs

         1.20 "PROJECT PLAN" means the project plan to be agreed by the parties
as described in the definition of "Project" above.

         1.21 "REGION" means delineated business units within PacifiCare
including Corporate, Central, Desert, Northwest, Southwest and Western. The
Regions may be revised by PacifiCare from time to time during the Term.

         1.22 "RESOURCE UNIT" means the applicable unit of measurement for usage
of the specified resource.

         1.23 "RRC(S)" or "Reduced Resource Charge(s)" means the resource
charges for the use of Services below the resource Baselines enumerated on
Attachment 17.4 hereto.

         1.24 "RRC DEADBAND" means the percentage below the Baseline within
which RRCs will not apply but, when exceeded, RRCs will apply. Each Resource
Unit has a RRC Deadband associated with it, as set forth in Section 4.3(b)(i)
below.

         1.25 "RRC DEADBAND BASELINE" has the meaning set forth in Section
4.3(b) (Calculation of RRCs for Resource Units) of this Schedule.

         1.26 "RRC RATE" means the rate at which PacifiCare is credited for its
reduced use of resources.

         1.27 "START UP FEES" mean all one-time costs associated with the
transition of Services from PacifiCare to Supplier.

         1.28 "STATEMENT OF WORK" or "SOW" means the Statement of Work attached
as Exhibit B to the Agreement.

                                       4.
<PAGE>
         1.29 "SUPPORTED DESKTOP RESOURCE" means a Desktop PC, Laptop PC or
Printer that is subject to support and service under the Agreement, and that is
operational, as described in Section 5.1(c) of Attachment 17.3 to this Schedule.

         1.30 "SUPPORTED SERVER" means a server that is subject to support and
service under the Agreement, and that is operational as described in Section
7.1(c) of Attachment 17.3 to this Schedule.

         1.31 "TOWER" is defined in the Statement of Work.

2.       GENERAL

         2.1 All pricing is based on the Supplier's responsibilities as set
forth in the Agreement including, in particular the Statement of Work. For
clarity, this pricing does not include expenses associated with responsibilities
of PacifiCare under the Agreement.

         2.2 All periodic charges will be computed on a calendar-month basis and
will be prorated for any partial month, unless this Agreement expressly states
otherwise.

         2.3 INVOICES. All Fees will be invoiced to PacifiCare. Supplier
acknowledges that PacifiCare desires certain levels of detail in such invoices
in order to facilitate tracking and payment. The invoices will set forth the
details (i.e., as line-item entries) as agreed to by the parties within thirty
(30) days after the Effective Date. In accordance with Section 17.15 of the
Agreement (Funds Transfer), PacifiCare will pay amounts to Supplier to the
account specified on Attachment 17.7 hereto.

3.       NON-VARIABLE FEES

         3.1 BASE FEES. Base Fees are the Operational Fees set forth in
Attachment 17.1 to this Schedule. PacifiCare shall pay the Base Fees in
accordance with Section 17.2 of the Agreement.

                  (a) OPERATIONAL FEES. Operational fees include the management
service fees, equipment and software costs, and other fees and costs that are
listed for each Tower on Attachment 17.1 to this Schedule.

         3.2 START UP FEES include transition costs for each Tower (Data Center,
Network, Desktop, Help Desk, Distributed Computing and IDC), as well as costs
for Key Hiring Bonus, Sign on Bonus, Enhanced Severance and HR Compensation and
Benefits true-up, all as enumerated on Attachment 17.1 to this Schedule.

         3.3 ASSET CHARGES. Supplier will purchase the Assets as set forth in
Section 3.8 of the Agreement. The instructions applicable to the wire transfer
discussed in Section 3.8 of the Agreement are set forth on Attachment 17.9
hereto.

         3.4 BILLING. [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
                                       5.
<PAGE>
         3.5 SPECIAL NOTE. Start Up Fees and Asset Charges are included on the
Fees matrix as set forth as Attachment 17.1 hereto, and will be invoiced along
with and as part of the Base Fees in accordance with Section 17 of the
Agreement.

4.       VARIABLE FEES

         4.1 GENERAL. As of the Effective Date and each month thereafter,
Supplier will measure, track and report on PacifiCare's usage of Resource Units
(as described on Attachment 17.3 hereto) as compared with the applicable
Resource Unit Baseline set forth in Attachment 17.4 to this Schedule. To the
extent that Resource Unit descriptions are not reflected in this Schedule or the
Attachment, the parties agree to determine the measurement methodology within
thirty (30) days of the Effective Date. Rates for Resource Units on a per-unit
basis are set forth on Attachment 17.2 hereto. In the event the that PacifiCare
exceeds or underutilizes a Resource Unit, or if PacifiCare requests a New
Service that is an additional incremental service to a current service (i.e., an
increase in a service that is currently provided by Supplier for PacifiCare at
the time the New Service is requested), Supplier will, in accordance with
Section 17.3 of the Agreement (Variable Fees and Baseline Adjustments),
calculate Supplier's prospective fee for such additional incremental service
using the methodology set forth in this Section 4 and the charges set forth for
the applicable Resource Units in Attachment 17.2 to this Schedule. Any requests
for New Services are subject to the terms of the Agreement, including the terms
of Section 3.10 (Right to Use Third Parties).

         4.2 BASELINES. The quantity of Resource Units for each category of
resources provided to PacifiCare under the Agreement for the applicable
measurement period as of the Effective Date will be specified in Attachment 17.4
to this Schedule as a Baseline. Supplier may, with PacifiCare's prior approval,
and at Supplier's expense, implement technological advancements relative to
providing the Services, provided Supplier performs the Services according to the
Service Levels. If such technological advancements will have an effect on a
Baseline, Supplier will normalize such affected Baseline, and the ARC Rate
and/or RRC Rate so that PacifiCare receives the same or improved level of
performance and the same or improved price performance as PacifiCare received
under the methodology applicable to such Baseline, ARC Rate or RRC Rate.
Supplier will review with PacifiCare the conversion methodology (for example,
historical data) that Supplier used to support such adjustments.

         4.3 METHODOLOGY. PacifiCare's increased or decreased resource usage
within a Resource Unit Baseline may result in either an ARC or RRC. After the
completion of each month during the Term, following the first month after the
Effective Date, Supplier will calculate ARCs and RRCs as set forth in this
Section 4 (Variable Fees), and provide the reports described in Section 4.4
below.

                  (a) CALCULATION OF ARCS FOR RESOURCE UNITS. For each Resource
Unit, Supplier will compare the quantity of Resource Units used during the
applicable measurement period ("ACTUAL RESOURCE UNITS") with the product of the
Baseline for that Resource Unit, multiplied by the sum of 1.00 plus the ARC
Deadband (the "ARC DEADBAND BASELINE") for that Resource Unit. The ARC Deadbands
are set forth in the ARC Summary Chart below. There will be no increase of the
charges otherwise payable to Supplier for such period if the Actual Resource
Units do not exceed the applicable ARC Deadband Baseline for such period. If the

                                       6.
<PAGE>
Actual Resource Units exceed the applicable ARC Deadband Baseline for such
period, PacifiCare will pay Supplier an ARC with the current or future charges
(or, if no future charges will be due, make payment to Supplier) equal to the
product of the ARC Rate for the applicable Resource Unit, as set forth in
Attachment 17.2 to this Schedule, multiplied by the difference between the
Actual Resource Units for that Resource Unit and the applicable ARC Deadband
Baseline.

                  (i) ARC SUMMARY CHART.

<TABLE>
<CAPTION>
              REF. NUMBER++           RESOURCE UNIT                        ARC DEADBAND
<S>                                   <C>                                 <C>
                 [...***...]          [...***...]                          [...***...]
                 [...***...]          [...***...]                          [...***...]
                 [...***...]          [...***...]                          [...***...]
                 [...***...]          [...***...]                          [...***...]
                 [...***...]          [...***...]                          [...***...]
                 [...***...]          [...***...]                          [...***...]
                 [...***...]          [...***...]                          [...***...]
                 [...***...]          [...***...]                          [...***...]
                 [...***...]          [...***...]                          [...***...]
                 [...***...]          [...***...]                          [...***...]
</TABLE>

-------------

++From Attachment 17.4 to this Schedule.

                  (ii) EXAMPLE. Assuming the following variables, the ARC
calculation would be as follows below:

                           (1) [...***...]

                           (2) [...***...]

                           (3) [...***...]

                           (4) [...***...].

                                     ARC CALCULATION

ARC   =   [...***...]
ARC   =   [...***...]
ARC   =   [...***...]
ARC   =   [...***...]
ARC   =   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       7.
<PAGE>
ARC   =   [...***...]

In this example, the ARCs for IMACs for the month would be [...***...].

                  (b) CALCULATION OF RRCS FOR RESOURCE UNITS. For each Resource
Unit, Supplier will compare the quantity of Actual Resource Units used during
the applicable measurement period with the product of the Baseline for that
Resource Unit multiplied by the sum of 1.00 minus the RRC Deadband (the "RRC
DEADBAND BASELINE") for that Resource Unit. The RRC Deadbands are set forth in
the RRC Summary Chart below. There will be no decrease of the charges otherwise
payable to Supplier for such period if the Actual Resource Units do not fall
below the applicable RRC Deadband Baseline for such period. If the Actual
Resource Units fall below the applicable RRC Deadband Baseline for such period,
PacifiCare will be credited an RRC with the current or future charges (or, if no
future charges will be due, Supplier will make payment to PacifiCare) equal to
the product of the RRC Rate for the applicable Resource Unit, as set forth in
Attachment 17.2 to this Schedule, multiplied by the difference between the
applicable RRC Deadband Baseline and the Actual Resource Units. [...***...].

(i)      RRC SUMMARY CHART.

<TABLE>
<CAPTION>

              REF. NUMBER++           RESOURCE UNIT            RRC DEADBAND
<S>                                  <C>                       <C>
                 [...***...]          [...***...]              [...***...]
                 [...***...]          [...***...]              [...***...]
                 [...***...]          [...***...]              [...***...]
                 [...***...]          [...***...]              [...***...]
                 [...***...]          [...***...]              [...***...]
                 [...***...]          [...***...]              [...***...]
                 [...***...]          [...***...]              [...***...]
                 [...***...]          [...***...]              [...***...]
                 [...***...]          [...***...]              [...***...]
                 [...***...]          [...***...]              [...***...]
</TABLE>

-----------

++From Attachment 17.4 to this Schedule.

                  (ii) EXAMPLE. Assuming the following variables, the RRC
calculation would be as follows below:

                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       8.
<PAGE>
                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                       9.
<PAGE>
                                     RRC CALCULATION

RRC   =   [...***...]
RRC   =   [...***...]
RRC   =   [...***...]
RRC   =   [...***...]
RRC   =   [...***...]
RRC   =   [...***...]
RRC   =   [...***...]

In this example, the RRCs for IMACs for the month would be [...***...].

         4.4 REPORTING. Each month after the Effective Date, Supplier will
provide PacifiCare with a report detailing the calculations made by Supplier
pursuant to Section 4.3 above for each Resource Unit. Based upon these monthly
reports, the parties will reconcile payments and/or credits with other amounts
paid or payable every month, [...***...], which wIlL be reported monthly but
reconciled and invoiced (if necessary) quarterly.

         4.5 ASSETS. Supplier shall be responsible for securing the assets
associated with committed scheduled refreshes, as specified in the Statement of
Work. [...***...].

         4.6 PERIPHERALS. Supplier will acquire, receive, install and support
PacifiCare with Peripherals as defined and set forth in the Statement of Work.
Within thirty (30) days of the Effective Date, the parties will agree on the
procedures necessary to implement a structured procurement plan for Peripherals,
which will include an approval process for all non-standard configuration
equipment. The parties agree to discuss the possibility of creating a catalog of
pre-approved materials. Peripherals subject to refresh are included in the Base
Fees and will be provided at the time of the scheduled refresh. The cost of
other Peripherals that are not subject to refresh and of upgrades to assets out
of the refresh cycle will be permitted to be charged to PacifiCare. The
procurement plan will not permit Supplier to mark-up the cost of any Peripherals
or refresh materials, although IMACs will apply and there may be a separate
charge for procurement, receiving, and asset management.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      10.
<PAGE>
5.       FINANCIAL ASSUMPTIONS.

         5.1 If Supplier arrives at a Facility to perform a scheduled or agreed
onsite Service after appropriate notice to PacifiCare, but is unable to perform
the Service because of PacifiCare's action or inaction, the visit will be
counted and/or charged in accordance with this Schedule.

         5.2 PacifiCare will be financially responsible for all Consumables used
in the performance of all services.

         5.3 No inflation protection has been included in Supplier's price.

         5.4 HR Compensation and Benefits true-ups will occur as described
Schedule 11 to the Agreement (Human Resources Provisions).

         5.5 The operating software and tools capitalized as PacifiCare assets
will be provided to Supplier for its use at no additional cost to Supplier.

         5.6 PacifiCare will permit the Supplier the use of PacifiCare Service
Location and support services (fax, telephone, mail, etc.) by Supplier support
personnel for the purposes of performing the Services under this Agreement at no
cost to Supplier. This does not include individual office supplies, including
writing implements, paper, notepads, binders, and personal communication
devices, including pagers, PDAs, cell phones and Blackberrys. Supplier will
terminate use of, and manage the transfer of, the assets listed in the preceding
sentence from Affected Employees and Affected Contractors beginning on the
Effective Date, and continuing through no later than six (6) months after the
Effective Date.

         5.7 As of the Effective Date, Affected Employee and Affected
Contractors may be using an item of capital equipment (including the Desktop and
Distributed Computing Towers) that is subject to a lease from a third-party
vendor. [...***...].

         5.8 [...***...].

         5.9 Supplier will be PacifiCare's authorized agent to manage and
maintain the Managed Agreements. No fees will be charged for PacifiCare
Proprietary Software used in performance of the data center mission.

         5.10 [...***...].

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      11.
<PAGE>
[...***...]

         5.11 In addition to Service Levels described in the Agreement for Data
Center transition, downtime for all applications, including [...***...].

         5.12 Replacement Services for the [...***...] agreement will be deemed
New Services pursuant to and in accordance with the Agreement, including Section
3.10 (Right to Use Third Parties).

         5.13 Within five (5) days of the Effective Date, PacifiCare will
include as Attachment 17.6 a list of up to fifteen (15) contractors whose
services PacifiCare believes it is required to retain under its existing
agreements. For so long as Supplier retains the services of these contractors,
PacifiCare will be responsible for compensation to them under the existing
agreements. Supplier will credit against invoiced amounts the actual costs of
PacifiCare associated with compensating these contractors. When completed,
Attachment 17.6 will be integrated with and become a part of this Schedule.

6.       ADDITIONAL SERVICE FEES

         If Supplier provides Services to additional PacifiCare Included
Affiliates in accordance with Section 3.1 of the Agreement, then PacifiCare will
pay and fees or expenses related to the provision of such Services as negotiated
by the parties in accordance with that section.

7.       NEW SERVICES

         In the event that PacifiCare requests that Supplier perform a New
Service as described in Section 5.1 of the Agreement, Supplier shall calculate
Supplier's prospective fees for such New Service as follows:

         7.1 NEW SERVICE. In the event a New Service is not currently being
provided by Supplier for PacifiCare at the time the New Service is requested,
but is a service for which Supplier has a standard fee, Supplier shall calculate
Supplier's prospective fee for such New Service using Supplier's standard fee,
as described in Section 5.1 of the Agreement (New Services), and subject to
Section 17.14 of the Agreement [...***...]. In the event the New Service is not
currently being provided by Supplier for PacifiCare at the time the New Service
is requested, and is not a service for which Supplier has a standard fee,
Supplier shall calculate Supplier's prospective fee for such New Service using
its best available data, as described in Section 5.1 of the Agreement (New
Services) and subject to Section 17.14 of the Agreement [...***...].

         7.2 PROJECTS AND PROJECT PLANS. If PacifiCare requests that Supplier
undertake a Project, then, if required as described in the definition of Project
set forth above, the parties will mutually agree on a Project Plan prior to the
commencement of work. The Project Plan will include provisions for any
additional fees and/or expenses that may be agreed upon in connection with the
Project. Such fees may be calculated on a basis to be agreed by the parties, and
may, for

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      12.
<PAGE>
example, include hourly service fees, a fixed fee, an increase to the Base Fees,
or as otherwise agreed, subject in all cases to the terms of the Agreement
(including Section 5.1 of the Agreement (New Services) and Section 17.14
[...***...].

8.       APPLICATION PROJECT SERVICES

         If PacifiCare requests Supplier to perform application development or
maintenance services which are not part of the Agreement as of the Effective
Date, then such application development or maintenance services will be
considered to be New Services. The parties have agreed on the applicable rates
for such services, which are set forth on Attachment 17.8 to this Schedule.

9.       TERMINATION FEES

         9.1 EARLY TERMINATION FEE. In the event PacifiCare terminates the
Agreement pursuant to Section 24.1 of the Agreement and triggers payment of the
Early Termination Fee as set forth in Section 25.1 of the Agreement, PacifiCare
shall pay the applicable Early Termination Fee as set forth in Attachment 17.5
to this Schedule pursuant to the payment terms set forth in Section 25.1 of the
Agreement.

         9.2 TERMINATION ASSISTANCE SERVICES FEE. In the event any Termination
Assistance Services provided by Supplier cannot be provided through resources
included in the Fees, PacifiCare shall pay the Termination Assistance Services
Fee as provided in Section 26.2 of the Agreement.

10.      WIND-DOWN COSTS.

         PacifiCare will pay Wind Down Costs, if any, in accordance with the
terms of the Agreement.

11.      COST OF LIVING ADJUSTMENT

         11.1 ECONOMIC CHANGE ADJUSTMENT

         (a) Supplier will calculate and apply an adjustment to all Fees other
than Asset Charges (i.e., Operational Fees and Start Up Fees) based upon
economic changes (an "ECONOMIC CHANGE ADJUSTMENT" or "ECA") as described below
beginning in January 2003. The ECA will be payable on a prospective basis (for
example, the actual inflation for December 2002 will determine the ECA for the
year 2003) on the Fees (other than Asset Charges) and ARCs payable by
PacifiCare, minus the RRCs creditable to PacifiCare. The ECA will be determined
as soon as practicable after the end of each calendar year using the formula
below (the "ECA FACTOR").

         (b) Supplier will invoice PacifiCare for the ECA, if any, beginning in
January 2003 and monthly thereafter. PacifiCare and Supplier agree to use the
December unadjusted Consumer Price Index (national average), as published in the
Summary Data from the Consumer Price Index News Release by the Bureau of Labor
Statistics, US. Department of Labor, For All Urban Consumers ("CPI-U"), for
purposes of determining actual inflation. In the event the

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      13.
<PAGE>
Bureau of Labor Statistics stops publishing the CPI-U or substantially changes
its content and format, PacifiCare and Supplier will substitute another
comparable index published at least annually by a mutually agreeable source. If
the Bureau of Labor Statistics merely redefines the base year for the CPI-U from
1982-84 to another year, PacifiCare and Supplier will continue to use the CPI-U,
but will convert the Base Year Index to the new base year by using an
appropriate conversion formula.

         11.2 ACTUAL INFLATION. Supplier will calculate the ECA by comparing the
change in the year-to-year CPI-U with the CPI-U for December before the
Effective Date (the "BASE YEAR INDEX"). For each calendar year of the Term, the
actual CPI-U for December before the year for which the ECA is being calculated
("ACTUAL INFLATION") will be compared to the Base Year Index in Exhibit C-1 (for
example, the December 2002 CPI-U will be used to determine the ECA for the year
2003). If Actual Inflation is equal to or less than the Base Year Index, then no
ECA is due. If, however, Actual Inflation is greater than the Base Year Index,
then Supplier will apply the ECA to the Fees (other than Asset Charges) and ARCs
less RRCs due Supplier for the year for which Supplier is calculating the ECA.

         11.3 INFLATION SENSITIVITY. A percentage has been established that
reflects the inflationary impact on Supplier's delivery of the Services
(Inflation Sensitivity). The Inflation Sensitivity will apply to all Fees other
than the Asset Charges. The Inflation Sensitivity agreed by the parties is equal
to [...***...]%.

         11.4 ECA FACTOR. The ECA is equal to the ECA Factor times the sum of
the Base Fees plus ARCs due Supplier, less RRCs creditable to PacifiCare, for
each month of the calendar year succeeding the calendar year during which Actual
Inflation is greater than the Base Year Index.

                  (a) ECA FACTOR. The ECA Factor is calculated as follows:

ECA Factor                 =   [...***...];
Actual Inflation           =   [...***...];
Base Year Index            =   [...***...];
Inflation Sensitivity      =   [...***...].

                  (b) ECA CALCULATION. The example below calculates the ECA
based on the following assumptions:

         -        an Effective Date in 2001;

         -        a Base Year Index of the CPI-U for December 2000;

         -        ECA calculation begins in January 2002;

         -        Inflation Sensitivity of [...***...] percent; and

         -        the following Actual Inflation examples:

Base Year Index 2000 = [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      14.
<PAGE>
<TABLE>
<CAPTION>
Year                  2001             2002              2003              2004             2005
<S>                  <C>               <C>              <C>               <C>              <C>
Actual Inflation     [...***...]       [...***...]      [...***...]       [...***...]      [...***...]
</TABLE>

In this example, there will be an ECA for calendar years 2002 through 2005
because the Actual Inflation for the year preceding each year is greater than
the Base Year Index.

In this example, to determine the ECA amounts due in addition to the other
charges for February 2003, further assume:

         -        the monthly prorated portion of the Fees (other than Asset
                  Charges) for February is $[...***...],

         -        there are VMS ARCs of $[...***...] due for that month; and

         -        there are Database Instances RRCs of $[...***...] due
                  PacifiCare for that same month.

Then, the calculation is as follows:

ECA Calculation Example
ECA   =   [...***...]
ECA   =   [...***...]
ECA   =   [...***...]
ECA   =   [...***...]
ECA   =   [...***...]
ECA   =   [...***...]

         The ECA for each month of each year in which the ECA is due is
calculated as above (substituting the appropriate monthly amounts and the ECA
Factor based upon the actual information).

12.      ADJUSTMENTS RELATED TO SCHEDULES 7.1 (ASSIGNED AGREEMENTS) AND 7.2
(MANAGED AGREEMENTS).

         12.1 BACKGROUND. As described in Section 7 of the Agreement (Third
Party Agreements), Supplier will be responsible for payments pursuant to the
Assigned Agreements, and PacifiCare will remain responsible for payments
pursuant to the Managed Agreements. [...***...]:

         [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      15.

<PAGE>
         [...***...]

[...***...]

         12.2 ADJUSTMENT TO SCHEDULES 7.1 AND 7.2. The parties agree that on a
mutually agreeable date [...***...] (the "ADJUSTMENT DATE"), the parties will
revise Schedules 7.1 and 7.2 to:

         [...***...]

         12.3 ADJUSTMENTS TO PRICING. Concurrent with the adjustment to
Schedules 7.1 and 7.2 described above, and in accordance with those procedures:

         [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      16.
<PAGE>
[...***...].

         [...***...].

         12.4 PROVISIONS RELATED TO CERTAIN AGREEMENTS BETWEEN PACIFICARE AND
[...***...].

              (a) During the period between the Effective Date and the
Adjustment Date, the parties will review documentation related to four (4)
[...***...] agreements [...***...]:

                           [...***...]

         12.5 CUMULATIVE CHANGES. [...***...].

         12.6 SUPPLIER MONITORING. Supplier will monitor and manage agreements
in order to identify potential cost-efficiencies or agreements that could be
terminated without negative effects on the provision of Services. As Supplier
identifies such potentially beneficial circumstances, Supplier will present
recommendations to PacifiCare. Any changes to be made to

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      17.
<PAGE>
Schedules 7.1 or 7.2 after the Adjustment Date, including as the result of
PacifiCare accepting such recommendations, will be made, if at all, pursuant to
the Change Control Procedures in the Agreement.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      18.
<PAGE>
                                 ATTACHMENT 17.1

                                    BASE FEES

                                      19.
<PAGE>
                                ATTACHMENT 17.1

                                    BASE FEES

<TABLE>
<CAPTION>
              Category of Services                                            Year 1 *        Year 2         Year 3     Year 4
-----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                        <C>             <C>            <C>          <C>
OPERATIONAL FEES (K$)                                                      [...***...]     [...***...]    [...***...]  [...***...]

              DATA CENTER

              [...***...]

                                 DATA CENTER TOTAL

              NETWORK

              [...***...]

                                 NETWORK TOTAL

              DISTRIBUTED COMPUTING

              [...***...]

                                 DISTRIBUTING COMPUTING TOTAL

              DESKTOP

              [...***...]

                                 DESKTOP TOTAL

              HELP DESK          TOTAL

              PROJECT FTPs       TOTAL

              INFORMATION DISTRIBUTION CENTER

              [...***...]

                                 INFORMATION DISTRIBUTION CENTER TOTAL

TOTAL OPERATIONAL FEES

START-UP FEES

              TRANSITION COSTS (itemize):

              DATA CENTER TRANSITION

              NETWORK TRANSITION

              DESKTOP, HELP DESK AND DISTRIBUTED TRANSITION

              IDC TRANSITION

              PROJECT OFFICE TRANSITION

              ASSET PURCHASE FMV

              ASSET PURCHASE NBV

              [...***...]

              [...***...]

              [...***...]

TOTAL START-UP FEES

GRAND TOTAL FEES

</TABLE>

<TABLE>
<CAPTION>
              Category of Services                                              Year 5        Year 6        Year 7      Year 8
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                            <C>          <C>           <C>          <C>
OPERATIONAL FEES (K$)                                                          [...***...]  [...***...]   [...***...]  [...***...]

              DATA CENTER

              [...***...]

                                 DATA CENTER TOTAL

              NETWORK

              [...***...]

                                 NETWORK TOTAL

              DISTRIBUTED COMPUTING

              [...***...]

                                 DISTRIBUTING COMPUTING TOTAL

              DESKTOP

              [...***...]

                                 DESKTOP TOTAL

              HELP DESK          TOTAL

              PROJECT FTPs       TOTAL

              INFORMATION DISTRIBUTION CENTER

              [...***...]

                                 INFORMATION DISTRIBUTION CENTER TOTAL

TOTAL OPERATIONAL FEES

START-UP FEES

              TRANSITION COSTS (itemize):

              DATA CENTER TRANSITION

              NETWORK TRANSITION

              DESKTOP, HELP DESK AND DISTRIBUTED TRANSITION

              IDC TRANSITION

              PROJECT OFFICE TRANSITION

              ASSET PURCHASE FMV

              ASSET PURCHASE NBV

              [...***...]

              [...***...]

              [...***...]

TOTAL START-UP FEES

GRAND TOTAL FEES

</TABLE>

<TABLE>
<CAPTION>
              Category of Services                                             Year 9       Year 10       Total
------------------------------------------------------------------------------------------------------------------
<S>                                                                         <C>           <C>           <C>
OPERATIONAL FEES (K$)                                                       [...***...]   [...***...]   [...***...]

              DATA CENTER

              [...***...]

                                 DATA CENTER TOTAL

              NETWORK

              [...***...]

                                 NETWORK TOTAL

              DISTRIBUTED COMPUTING

              [...***...]

                                 DISTRIBUTING COMPUTING TOTAL

              DESKTOP

              [...***...]

                                 DESKTOP TOTAL

              HELP DESK          TOTAL

              PROJECT FTPs       TOTAL

              INFORMATION DISTRIBUTION CENTER

              [...***...]

                                 INFORMATION DISTRIBUTION CENTER TOTAL

TOTAL OPERATIONAL FEES

START-UP FEES

              TRANSITION COSTS (itemize):

              DATA CENTER TRANSITION

              NETWORK TRANSITION

              DESKTOP, HELP DESK AND DISTRIBUTED TRANSITION

              IDC TRANSITION

              PROJECT OFFICE TRANSITION

              ASSET PURCHASE FMV

              ASSET PURCHASE NBV

              [...***...]

              [...***...]

              [...***...]

TOTAL START-UP FEES

GRAND TOTAL FEES

</TABLE>

-------------------

*
          [...***...]
**
          [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
                                 ATTACHMENT 17.2

                               RESOURCE UNIT RATES

                                      20.
<PAGE>
                                 ATTACHMENT 17.2

                           UNIT RATES - INFRASTRUCTURE
<TABLE>
<CAPTION>
     UNIT RATES                             YEAR 1          YEAR 2            YEAR 3              YEAR 4           YEAR 5
----------------------------------------------------------------------------------------------------------------------------
<S>                                       <C>             <C>              <C>                 <C>              <C>
    Project FTPs
       [...***...]                         [...***...]    [...***...]      [...***...]         [...***...]      [...***...]

    DATA CENTER
       [...***...]                         [...***...]    [...***...]      [...***...]         [...***...]      [...***...]

    NETWORK
       [...***...]                         [...***...]    [...***...]      [...***...]         [...***...]      [...***...]

    CUSTOMER SUPPORT DESK (CSD)
       [...***...]                         [...***...]    [...***...]      [...***...]         [...***...]      [...***...]

DESKTOP SUPPORT
       [...***...]                         [...***...]    [...***...]      [...***...]         [...***...]      [...***...]
</TABLE>

<TABLE>
<CAPTION>
     UNIT RATES                            YEAR 6                 YEAR 7             YEAR 8        YEAR 9         YEAR 10
--------------------------------------------------------------------------------------------------------------------------
<S>                                     <C>                  <C>                  <C>           <C>           <C>
    Project FTPs
       [...***...]                       [...***...]           [...***...]         [...***...]   [...***...]   [...***...]

    DATA CENTER
       [...***...]                       [...***...]           [...***...]         [...***...]   [...***...]   [...***...]

    NETWORK
       [...***...]                       [...***...]           [...***...]         [...***...]   [...***...]   [...***...]

    CUSTOMER SUPPORT DESK (CSD)
       [...***...]                       [...***...]           [...***...]         [...***...]   [...***...]   [...***...]

DESKTOP SUPPORT
       [...***...]                       [...***...]           [...***...]         [...***...]   [...***...]   [...***...]
</TABLE>

                                 (continued on next page)

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                      Attachment 17.2 (continued from previous page)

                                Unit Rates - INFRASTRUCTURE

<TABLE>
<CAPTION>
  UNIT RATES                                   Year 1              Year 2          Year 3              Year 4           Year 5
---------------------------------------------------------------------------------------------------------------------------------
<S>                                           <C>               <C>              <C>                  <C>             <C>
DISTRIBUTED COMPUTING
       [...***...]                            [...***...]       [...***...]      [...***...]          [...***...]     [...***...]

INFORMATION DISTRIBUTION CENTER - MONTHLY
       [...***...]                            [...***...]       [...***...]      [...***...]          [...***...]     [...***...]
</TABLE>

<TABLE>
<CAPTION>
  UNIT RATES                                       Year 6         Year 7        Year 8             Year 9         Year 10
----------------------------------------------------------------------------------------------------------------------------
<S>                                              <C>            <C>           <C>               <C>              <C>
DISTRIBUTED COMPUTING
       [...***...]                               [...***...]    [...***...]   [...***...]       [...***...]      [...***...]

INFORMATION DISTRIBUTION CENTER - MONTHLY
       [...***...]                               [...***...]    [...***...]   [...***...]       [...***...]      [...***...]
</TABLE>

[...***...]

[...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                 ATTACHMENT 17.3

                           RESOURCE UNIT DESCRIPTIONS

1.       GENERAL.

         1.1 PROFILE ADJUSTMENTS. Certain pricing assumptions contained in this
Attachment contain profiles (e.g., average call time will be [...***...]
minutes). To the extent that an assumption contains a profile, and the actual
numbers or amounts deviate from the numbers or amounts specified in that profile
by more than [...***...] percent ([...***...]%) over any [...***...]month period
during the Term, then the parties agree to discuss adjustments to the profile or
any other provision (including price), as appropriate. No adjustments will be
made except by mutual agreement of the parties.

         1.2 MEASUREMENT. As noted in Section 4.1 of Schedule 17 (to which this
Attachment is attached), to the extent that Resource Unit descriptions are not
reflected in this Attachment, the parties agree to determine the measurement
methodology within thirty (30) days of the Effective Date.

2.       PROJECT SERVICES BASELINE RESOURCE UNITS.

         2.1 RESOURCE UNITS. The Resource Unit for a Project is a Project FTP,
which consists of a monthly charge for an experienced technician (exclusive of
travel). A technician has skills in hardware, software, problem management or
physical database management and administration, as required to perform the
applicable Project services, and may be responsible for activities including
evaluating, installing, configuring, troubleshooting and supporting equipment
and software products.

         2.2 MANAGEMENT OF PROJECT FTPs. The Project FTPs will be tasked by
PacifiCare through a Project authorization process that will be developed by
Supplier and approved by PacifiCare during the first 60 days after the Effective
Date. [...***...].

         2.3 MEASUREMENT AND RECONCILIATION. Use of Project FTPs will be
measured, tracked and reported to PacifiCare by Supplier on a monthly basis, and
will be reconciled and invoiced (if applicable) on a quarterly basis.

         2.4 SPECIAL CONSIDERATIONS FOR PROJECT FTPs. With respect to the
utilization of Project FTPs:

                  (a) notwithstanding Section 3.10 of the Agreement (Right to
Use Third Parties), PacifiCare [...***...].

                  (b) notwithstanding Section 4.3(b) of Schedule 17 (to which
this Attachment is attached), there will be RRCs for resource usage of Project
FTPs below [...***...] percent ([...***...]%) of the Baselines as of the
Effective Date.

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      21.
<PAGE>
3.       DATA CENTER SERVICES BASELINE RESOURCE UNITS

         3.1 SERVER RESOURCE UNITS. Supplier will categorize each of the servers
based on the server size (small, medium and large) for UNIX. VMS servers are not
categorized based on server size. Each category of server, including categories
based on the server size, will have a separate baseline associated with the
server category. [...***...]. As the standards are updated or as new
requirements that deviate from the standards are established, the standard
configuration will provide the Baseline for measuring change. The installed
Baselines and charges will not be subject to adjustment when a standard is
updated, however, when such Resource Unit Baseline is refreshed, then it will be
refreshed with the then current standard.

         3.2 DATABASE RESOURCE UNITS. A database Resource Unit is any
[...***...] database, supported by Supplier personnel, residing on PacifiCare
production and development systems.

         3.3 STORAGE RESOURCE UNITS. A storage Resource Unit equals [...***...]
of storage.

         3.4 ASSUMPTIONS. Supplier's charges for Resource Units are based on the
following assumptions:

                  (a) Hours of operations support (as described in the Statement
of Work, in particular Sections B(2) and B(4)) are 24x7.

                  (b) System hardware moves for the production and ILIAD
clusters must be accomplished within a 24 hour window. The remaining system
hardware moves can be performed during weekends and three (3) day holidays with
reduced impact to PacifiCare processing requirements and with PacifiCare's prior
approval, in accordance with Schedule 16.1 to the Agreement (Critical Services).

                  (c) Consolidation, relocation, and migration from the
PacifiCare data center to the IBM data center in St. Louis, MO. will occur as
identified in Schedule 4.1 of the Agreement (Transition Plan).

4.       NETWORK SERVICES BASELINE RESOURCE UNITS

         4.1 DATA NETWORK SERVICES RESOURCE UNITS. Resource Units for this
category means the number of devices used (as categorized by routers, switches,
hubs, and CSUs) to connect the Data Center to the Data NETWORK locations in
Schedule 6.3(a) to the Agreement (Facilities Space Requirements and Rules &
Regulations). This Schedule 6.3(a) lists the data communications lines with
their capacities and addresses of the from and to locations. The Base Fee
includes the frame relay based connection charges for these locations. "DATA
NETWORK" means the machines, associated attachments, features and accessories,
Software, lines and cabling used to connect, transmit and receive data between
the Data Center(s) and PacifiCare locations listed in Schedule

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      22.
<PAGE>
         10.1 to the Agreement (Service Locations), including routers, network
switches, circuits and DSUs/CSUs, but excluding Desktop PCs and Laptop PCs.

                  (a) ROUTERS. A router Resource Unit is measured by number of
physical machines.

                  (b) NETWORK SWITCHES. A Network Switch Resource Unit is
measured by number of physical machines.

                  (c) CIRCUITS. A Circuit Resource Unit is measured by number of
billed circuits.

                  (d) Digital Service UNITS (DSUs)/CHANNEL SERVICE UNITS (CSUs).
Resource Units for DSUs/CSUs are measured by number of physical machines.

         4.2 VOICE NETWORK SERVICES RESOURCE UNITS.

                  (a) PBX MAINTENANCE. Resource Units for the maintenance of
PacifiCare's Avaya and Siemens PBX telephone systems are based on the specified
number of each type, model, version and software release of PBXs, and the total
number of ports for each type of system. Maintenance charges are based on
coverage from 8 AM to 5 PM (local time) from Monday through Friday. Maintenance
charges do not cover telephone stations and specified adjunct equipment. These
costs do not include the costs of the telephone lines for connectivity to these
systems which will be paid for by PacifiCare.

                  (b) ASPECT ASD MAINTENANCE. Resource Units for the maintenance
of PacifiCare's Aspect ASD systems are based on the number of ASD licenses
currently in force on these systems. These costs do not include the costs of the
telephone lines for connectivity to these systems which will be paid for by
PacifiCare.

                  (c) VOICE MAIL MAINTENANCE. Resource Units for the maintenance
of PacifiCare's [...***...] voice mail systems are based on the specified number
of each type, model, version and software release of voice mail systems.
Maintenance charges are based on coverage from 8 AM to 5 PM (local time) from
Monday through Friday. Maintenance charges for [...***...] voice mail systems
are for base voice mail units only, and do not cover connectivity and peripheral
equipment costs.

                  (d) VIDEO CONFERENCING MAINTENANCE. Resource Units for video
conferencing systems are based on the specified number of each type, model,
version and software release of video conferencing systems. Maintenance charges
are based on coverage from 8 AM to 5 PM (local time) from Monday through Friday.
Maintenance charges are for base voice mail units only, and do not cover
connectivity and peripheral equipment.

                  (e) VOICE MAIL INSTALLS, MOVES, ADDS AND CHANGE SERVICE
ACTIVITY ("IMAC") charges. [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED

                                      23.
<PAGE>

      4.3 ASSUMPTIONS. Supplier's charges for Resource Units are based on the
following assumptions:

            [...***...]

                                      24.      *CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
[...***...].

5. DESKTOP SERVICES BASELINE RESOURCE UNITS

      5.1 SUPPORTED DESKTOP PCS, LAPTOP PCS, AND PRINTERS

            (d) Resource Units for this category will be measured as the number
of supported Desktop Resources (on a Desktop PC, Laptop PC, or Printer basis)
operational at the Facilities based on information provided by PacifiCare during
the Transition Period. One supported Desktop PC equals one Resource Unit, one
Laptop PC equals one Resource Unit and one printer equals one Resource Unit.

            (e) There are 3 classifications of supported Desktop Resources:
Desktop PCs, Laptop PCs and Printers (as enumerated in Attachment 17.4 to this
Schedule, Reference Numbers 501 through 503), each having a separate Baseline
and an associated ARC Rate and RRC Rate. Such classifications reflect the
differences in the allocation of shared or required infrastructure, equipment
and software, maintenance and support costs, infrastructure design or Service
Level commitments.

            (f) A Supported Desktop Resource will be considered operational:

                  (i) when Supplier or PacifiCare install it according to the
criteria for a completed installation, set forth in the Policy and Procedures
Manual (Schedule 13.3 to the Agreement) or as Supplier discovers or is otherwise
notified by PacifiCare;

                  (ii) until Supplier deinstalls it as an IMAC event or as
Supplier is otherwise notified that it is a deinstalled unit; or

                  (iii) until it is classified as unserviceable in accordance
with the Policy and Procedures Manual, which is set forth as Schedule 13.3 to
the Agreement.

      5.2 INSTALL, MOVE, ADD, AND CHANGE SERVICES. IMAC services encompass the
coordination and performance of Installation, Move, Add, Change Services and
Remove activities.

            (a) RESOURCE UNITS. Resource Units for this category will be
measured as the aggregate number of Install, Move, Add, and Change Service
events Supplier performs during the applicable measurement period. IMAC events
are defined as follows:

                  (i) INSTALL means the setup and connection of standard
equipment. The source of the equipment can be either through the procurement
process or from a storage location containing unused equipment. An Install
includes unpacking, connecting the system unit and associated Peripherals,
adding an asset tag and testing to verify that the system is functional with
network connectivity, as applicable. Supplier will migrate End User data from
the existing system onto the new standard system, if applicable.

                                       25.    * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                  (ii) MOVE means relocating a system unit and associated
peripherals from its current location and relocating it to a new location
requiring no modification to the system software other than minor configuration
changes to operate in a new location (e.g. new IP address). A Move includes
disconnecting the system unit and peripherals, packing, unpacking, reconnecting
the system unit and associated peripherals, and testing to verify that the
system is functional with network connectivity, as applicable. Transportation is
not included as part of the Move activity. "Move" also includes system units
that are disconnected from a current location and relocated to a storage or
staging area for future development.

                  (iii) ADD means the installation of new hardware or Software
to an existing device. A hardware add includes the installation of an external
device and the appropriate device driver. A Software add includes an
installation of up to five applications using a server-based distribution
process or via media.

                  (iv) CHANGE SERVICE means a modification to an existing
system/unit. It may consist of a hardware upgrade or downgrade (remove
functionality), a Software application upgrade, a Software system upgrade, or a
end user requested configuration change.

Software upgrades or changes that represent significant functional enhancements
and require changes to data structure (for example, Windows 3.1 to Windows 95)
may be handled, at PacifiCare's option, as:

                        a. an IMAC (i.e., as a Change Service to the software)
per end-user upgrade;

                        b. charged as hourly services; or

                        c. as a Project.

                  (v) CASCADE means the combination of a Refresh event and a
Move event. The device being replaced by the Refresh unit is moved to another
location and that replaced device is the unit that is disposed. No more than one
(1) Cascade will be scheduled in conjunction with a single Refresh installation.
All Cascade events will be billed in accordance with the IMAC process.

                  (vi) REDEPLOY means the installation of previously used
equipment that has been in storage. This is the equivalent of and charged as an
Install event. To be eligible for Redeploy, the equipment must meet the minimum
hardware standards as defined for the PacifiCare environment.

                  (vii) DISPOSE means removal of equipment at the end of its
life. Supplier will validate data is removed from the hard drive, if applicable.
Equipment that is owned by Supplier will be disposed of in accordance with the
Policy and Procedures Manual. The cost for disposing of PacifiCare-owned
equipment is not covered in the Base Fees.

                  (viii) IMAC PROJECT means requests for IMAC services which
contain [...***...] or more IMAC events on a single request. All IMAC Projects
shall have mutually

                                       26.    * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
agreed to implementation schedules outside the normal SLA requirements. There
are no additional costs for IMAC Projects outside the normal IMAC event costs.

                  (ix) EXPEDITED IMAC SERVICE means:

                        (1) requests for IMAC service that must be completed in
less time than the stated SLA requirement; or

                        (2) PacifiCare requested cancellations of service
[...***...];

                        (3) [...***...].

      Based on the total IMAC event counts for a given calendar month, the first
three percent (3%) of Expedited IMAC Service events in the same calendar month
will not have any additional costs. All Expedited IMAC Service events above
[...***...] will count as one (1) additional IMAC event.

            (b) VIRUS INCIDENTS. In the event of a Virus incident:

                  (i) activities necessary to redress the Virus incident,
including those resulting from virus definition installs or upgrades (to desktop
or to server), will not be counted as IMAC events and will not be coordinated
through the IMAC process; and

                  (ii) activities related to the redress of the Virus incident
(including installs or upgrades) will proceed as required under the Agreement;
and

                  (iii) the parties will discuss and agree to (A) any
adjustments to the Service Level commitments during the period in which the
redress activities take place and (B) supplementary costs or expenses, or both,
that may be occasioned by
the undertaking of activities that are necessary to redress a Virus incident.

            (c) MEASUREMENT. Each IMAC event described above will be counted in
accordance with the following IMAC events chart. The IMAC Baseline set forth in
Attachment 17.4 reflects the agreed quantity of IMAC events included in the Base
Fees.

      As described above in Sections 4.3(a) and (b), respectively, ARCs apply to
IMAC event resources above [...***...] percent ([...***...]%) of the IMAC
Baseline, and RRCs apply to IMAC event resources below [...***...] percent
([...***...]%) of the IMAC Baseline.

                            IMAC EVENTS

             IMAC                              NUMBER OF IMAC EVENTS

            Install                              [...***...]

                                      27.     * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                   IMAC EVENTS

                Move

                  -  within a Facility               [...***...]
                  -  between Facilities              [...***...]

                Add

                  -  hardware                        [...***...]
                  -  Software                        [...***...]
                Change Service

                  -  hardware                        [...***...]
                  -  software                        [...***...]
                Dispose                              [...***...]

            (d) EXAMPLES. IMAC Charging examples:

                  (i) New device ordered to replace existing device that is
disposed of: (1 Install and 1 Dispose).

                  (ii) End user requests new hard drive, memory upgrade, and new
network card. (1 Change Service as long as all new equipment is installed on a
single trip. If end user requests that multiple trips be done, each trip will
count as 1 Change Service event).

                  (iii) Move PC along with person's telephone number to new
office. (1 Move and 1 Voice).

                  (iv) Application is electronically pushed/pulled to end user
outside the scope of the Statement of Work (Not an IMAC event resulting in an
adjustment to the baselines. This would be a Project subject to the procedures
set forth in the Statement of Work.).

                  (v) Install a new printer (1 Install).

                  (vi) Install external CD-RW device to existing PC (1 Change
Service).

                  (vii) Take memory out of one PC and install it into another PC
(2 Change Services).

                  (viii) A new PC is ordered. The PC that is being replaced is
to be moved to another user who does not have a PC. (1 Install and 1 Move).

                  (ix) An end user leaves the business and his/her PC is put
into storage until needed. (1 Move to put in storage, 1 Redeploy when needed).

                  (x) Area is recarpeted over weekend and entire department (50
users) needs to be removed and re-installed afterwards (worked as IMAC Project
and would count as

                                      28.     * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
50 Moves. Because the event is continuous, there is no additional fee for the
temporary storage of equipment).

                  (xi) New device is ordered and existing device is moved to
another user and his/her device is to be disposed of. (1 Install, 1 Move, and 1
Dispose).

                  (xii) End user wants to add a new printer to printer folder
(If done via Help Desk call, no IMAC. If end user requests that someone come to
his/her work area, 1 Change Service).

                  (xiii) PacifiCare requests that all desktops be upgraded to
Window XP (This would be treated as a Project).

                  (xiv) Move a local attached printer from one desktop to
another (1 Move).

                  (xv) Install scanner to PC and add an application that comes
with scanner (1 Add, there is no additional cost for the application install as
long as it is done at the same time as the scanner install).

      5.3 ASSUMPTIONS. Supplier's charges for Resource Units for Desktop and
Distributed Computing Management are based on the following assumptions

            [...***...].

                                      29.     * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
            [...***...].

6. CUSTOMER SUPPORT DESK (CSD) SERVICES BASELINE RESOURCE UNITS

      6.1 RESOURCE UNIT. After the Transition Period, Resource Units for this
category will be measured as described below.

            (a) END USERS. The Baseline for this category will be measured as
the total number of end users. One end user will equal one Resource Unit.

                                      30.     * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
            (b) EXCHANGE ACCOUNT SERVICES. Resource usage for this category will
be measured as the number of Exchange Accounts created per year. One Exchange
Account will equal one Resource Unit.

            (c) REMOTE ACCESS SERVICES. The Baseline for this category will be
measured as the number of initial remote administration creations per year. One
initial remote administration creation will equal one Resource Unit.

            (d) SECURITY ACCOUNT SERVICES. The Baseline for this category will
be measured as the number of security accounts created per year (logon
requests). One security account creation will equal one Resource Unit.

      6.2 ASSUMPTIONS. Supplier's charges for Resource Units are based on the
following assumptions:

            [...***...].

7. DISTRIBUTED COMPUTING SERVICES BASELINE RESOURCE UNITS

      7.1 SUPPORTED DISTRIBUTED SERVERS.

            (a) RESOURCE UNITS. Resource Units for this category will be
measured as the number of Supported Servers operational in distributed
environment. One Supported Server equals one Resource Unit.

                                      31.     * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
            (b) There are four (4) classifications of Supported Servers: small,
medium, large and NT Storage, each having a separate Baseline and associated ARC
Rate and RRC Rate.

            (c) A Supported Server will be considered operational:

                  (i) when Supplier or PacifiCare install it according to the
criteria for a completed installation, set forth in the Policy and Procedures
Manual or as Supplier discovers or is otherwise notified by PacifiCare;

                  (ii) until Supplier or PacifiCare deinstall it, or Supplier is
otherwise notified that it is a deinstalled unit; or

                  (iii) until it is classified as unserviceable in accordance
with the Policy and Procedures Manual, which is set forth as Schedule 13.3 to
the Agreement.

8. INFORMATION DISTRIBUTION SERVICES RESOURCES

      8.1 BASELINES. The Baselines for this resource category will be based upon
PacifiCare's estimates provided in the Attachments to this Schedule as of the
Effective Date.

            (a) Each single image or one-sided page will equal one (1) print
hardcopy Resource Unit.

            (b) Online print image or screen of online printed output will be
measured in gigabytes. A Resource Unit will be one (1) gigabyte.

            (c) Each page of output automatically inserted into an envelope will
equal one (1) auto insert flat Resource Unit.

            (d) Each hour of time spent performing automated insertion of pages
into an envelope will equal one (1) Resource Unit.

            (e) The average monthly number of inserts included per item of
output (standard size) will equal one (1) Resource Unit.

            (f) Each hour of time spent performing manual output assembly will
equal one (1) manual assembly Resource Unit.

            (g) Each image or one-sided page of color print will equal one (1)
demand print color Resource Unit.

            (h) Each image or one-sided page of black and white print will equal
one (1) demand print black/white Resource Unit.

            (i) Each hour of time spent creating any other print processing
and/or output will equal one (1) demand print special processing Resource Unit.

            (j) Each mail stop located within the Cypress and Lake Center
facilities will equal one (1) mail stop Resource Unit.

                                      32.
<PAGE>
            (k) The total of all pieces of inbound and output US mail and
interoffice mail processed from the Cypress and Lake Center facilities in one
month will equal one (1) mail Resource Unit.

            (l) The total of all pieces of inbound/output accountable
(certified, registered, etc.) mail processed from the Cypress and Lake Center
facilities in one month will equal one (1) accountable mail Resource Unit.

            (m) Each item stocked in the IDC warehouse will equal one (1)
warehouse Resource Unit.

            (n) Each item ordered for the IDC warehouse will equal one (1)
warehouse order item Resource Unit.

            (o) Each service call physically handled by the IDC personnel will
equal one (1) customer support call Resource Unit.

            (p) As described above in Sections 4.3(a) and (b), respectively,
ARCs apply to Information Distribution Center resources above [...***...]
percent ([...***...]%) of the Baselines, and RRCs apply to Information
Distribution Center resources below [...***...] percent ([...***...]%) of the
Baselines.

            (q) NON-PRINT MEDIA PROCESSING FTP. The Resource Unit for an FTP for
Non-Print Media Processing (see Attachment 17.4, Reference Number 707) is a
Non-Print Media Processing FTP, which consists of a monthly charge for an
onsite, experienced technician (exclusive of travel). The technician has skills
in non-print media processing, as required.

            (r) INFORMATION DISTRIBUTION CENTER ACCOUNT MANAGER FTP. The
Resource Unit for an Information Distribution Center Account Manager (see
Attachment 17.4, Reference Number 708) is an Information Distribution Center
Account Manager FTP, which consists of a monthly charge for an onsite,
experienced project manager (exclusive of travel). An account manager has skills
in either account management, records management, or print output management, as
required.

            (s) INFORMATION DISTRIBUTION CENTER TECHNICAL FTP. The Resource Unit
for an Information Distribution Center Technician (see Attachment 17.4,
Reference Number 709) is an Information Distribution Center Technical FTP, which
consists of a monthly charge for an onsite, experienced technician (exclusive of
travel). A technician has skills in print, mail, or document management and
administration, as required.

                                      33.     * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                 ATTACHMENT 17.4

                             RESOURCE UNIT BASELINES

                         [SEE REDACTED ATTACHMENT 17.4]
<PAGE>
                                ATTACHMENT 17.4

                    RESOURCE UNIT BASELINES - INFRASTRUCTURE

<TABLE>
<CAPTION>
              RESOURCE UNITS                      BASE YEAR       YEAR 1        YEAR 2        YEAR 3        YEAR 4        YEAR 5
<S>                                              <C>           <C>           <C>            <C>           <C>           <C>
 Ref Project FTPs

        [...***...]                              [...***...]   [...***...]   [...***...]    [...***...]   [...***...]   [...***...]

     DATA CENTER

        [...***...]                              [...***...]   [...***...]   [...***...]    [...***...]   [...***...]   [...***...]

     NETWORK

        [...***...]                              [...***...]   [...***...]   [...***...]    [...***...]   [...***...]   [...***...]

     CUSTOMER SUPPORT DESK (CSD)

        [...***...]                              [...***...]   [...***...]   [...***...]    [...***...]   [...***...]   [...***...]

     DESKTOP SUPPORT

        [...***...]                              [...***...]   [...***...]   [...***...]    [...***...]   [...***...]   [...***...]

     DISTRIBUTED COMPUTING

        [...***...]                              [...***...]   [...***...]   [...***...]    [...***...]   [...***...]   [...***...]

     INFORMATION DISTRIBUTION CENTER - MONTHLY

        [...***...]                              [...***...]   [...***...]   [...***...]    [...***...]   [...***...]   [...***...]

</TABLE>

<TABLE>
<CAPTION>
              RESOURCE UNITS                        YEAR 6         YEAR 7          YEAR 8        YEAR 9         YEAR 10
<S>                                               <C>            <C>            <C>            <C>            <C>
 Ref Project FTPs

        [...***...]                               [...***...]    [...***...]    [...***...]    [...***...]    [...***...]

     DATA CENTER

        [...***...]                               [...***...]    [...***...]    [...***...]    [...***...]    [...***...]

     NETWORK

        [...***...]                               [...***...]    [...***...]    [...***...]    [...***...]    [...***...]

     CUSTOMER SUPPORT DESK (CSD)

        [...***...]                               [...***...]    [...***...]    [...***...]    [...***...]    [...***...]

     DESKTOP SUPPORT

        [...***...]                               [...***...]    [...***...]    [...***...]    [...***...]    [...***...]

     DISTRIBUTED COMPUTING

        [...***...]                               [...***...]    [...***...]    [...***...]    [...***...]    [...***...]

     INFORMATION DISTRIBUTION CENTER - MONTHLY

        [...***...]                               [...***...]    [...***...]    [...***...]    [...***...]    [...***...]

</TABLE>

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                 ATTACHMENT 17.5

                            TERMINATION FEE SCHEDULE

<TABLE>
<CAPTION>
         CATEGORY OF SERVICES             YEAR 1        YEAR 2      YEAR 3        YEAR 4       YEAR 5       YEAR 6       YEAR 7
<S>                                     <C>          <C>          <C>          <C>          <C>          <C>
TERMINATION FOR CAUSE

              [...***...]

TOTAL TERMINATION  FEES

TERMINATION FOR CHANGE OF CONTROL

              [...***...]               [...***...]  [...***...]  [...***...]  [...***...]  [...***...]  [...***...]  [...***...]

TOTAL  TERMINATION  FEES

TERMINATION FOR CONVENIENCE

              [...***...]               [...***...]  [...***...]  [...***...]  [...***...]  [...***...]  [...***...]  [...***...]

TOTAL  TERMINATION  FEES
</TABLE>

<TABLE>
<CAPTION>
         CATEGORY OF SERVICES                    YEAR 8          YEAR 9           YEAR 10
<S>                                            <C>             <C>              <C>
TERMINATION FOR CAUSE

              [...***...]

TOTAL TERMINATION  FEES

TERMINATION FOR CHANGE OF CONTROL

              [...***...]                      [...***...]     [...***...]      [...***...]

TOTAL  TERMINATION  FEES

TERMINATION FOR CONVENIENCE

              [...***...]                      [...***...]     [...***...]      [...***...]

TOTAL  TERMINATION  FEES
</TABLE>

ALGORITHM FOR CALCULATING FEES ON ANY DATE OTHER THAN THE ANNIVERSARY OF THE
EFFECTIVE DATE
<TABLE>
<S>                                             <C>
TERMINATION FOR CAUSE

TERMINATION FOR CHANGE OF CONTROL               [...***...]

TERMINATION FOR CONVENIENCE                     [...***...]
</TABLE>

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                ATTACHMENT 17.6

                              RETAINED CONTRACTORS

                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                 ATTACHMENT 17.7

                           FUNDS TRANSFER INFORMATION

                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                 ATTACHMENT 17.8

                     RATES FOR APPLICATION PROJECT SERVICES

                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                 ATTACHMENT 17.9

                       WIRE INSTRUCTIONS FOR ASSET CHARGES

                                   [...***...]

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 24.4

                      FAILURE TO PROVIDE CRITICAL SERVICES

Solely for the purposes of Section 24.4 of the Agreement, the following sets
forth the Critical Services and the specific allowable cure periods:

<TABLE>
<CAPTION>
        CRITICAL SERVICE                             CURE PERIOD
<S>                                                  <C>
        [...***...]                                  [...***...]
        [...***...]                                  [...***...]
        [...***...]                                  [...***...]
        [...***...]                                  [...***...]
        [...***...]                                  [...***...]
        [...***...]                                  [...***...]
        [...***...]                                  [...***...]
</TABLE>

Limitations.  [...***...].

                                              * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
                                  SCHEDULE 26.1
<PAGE>
                                  SCHEDULE 26.1

                         TERMINATION ASSISTANCE SERVICES

1.    INTRODUCTION AND OBJECTIVES

        During the Termination Assistance Period, in addition to its obligations
        under Section 26 of the Agreement, Supplier shall provide PacifiCare or
        its Designee the Termination Assistance described in this Schedule 26.1.

        Any capitalized terms used herein, and not otherwise defined, shall have
        the meanings ascribed to such terms in the Agreement.

        Supplier shall, by the end of the Termination Assistance Period, provide
        existing applicable documentation and facilitate a knowledge transfer
        regarding the Services to PacifiCare or, at PacifiCare's option, its
        Designee.

2.    DURING THE TERMINATION ASSISTANCE PERIOD:

      (a)   If PacifiCare is to assume primary responsibility for the Services
            after the end of the Termination Assistance Period, Supplier shall,
            upon PacifiCare's request, provide assistance with the development
            of a plan for the transition of Services from Supplier to PacifiCare
            (the "PLAN"), which shall be no less detailed than the Transition
            Plan, and shall address each process, schedule, and milestone listed
            therein. A "skeleton" transition plan describing, in general, the
            components to be included in the Plan shall be delivered to
            PacifiCare within thirty (30) days after the "Termination Assistance
            Start Date." Termination Assistance Start Date shall mean the
            earlier of (1) upon the delivery of notice of termination, or (2)
            the day after either Party notifies the other Party of its intent
            not to extend the term pursuant to Section 2.2 of the Agreement.

            The Plan shall specify:

            i.    The resources necessary to provide transition assistance;

            ii.   The details regarding Supplier responsibilities and PacifiCare
                  responsibilities that are necessary to permit execution of the
                  transition; and

            iii.  A timetable and process for executing Supplier's and
                  PacifiCare's responsibilities for the transition. Such
                  timetable and process must deal with each of the issues set
                  out in this Schedule 26.1.

      (b)   If PacifiCare's Designee is to assume primary responsibility for the
            Services, Supplier shall assist PacifiCare and its Designee with the
            preparation and implementation of a transition plan by providing, in
            a timely manner upon PacifiCare's request, the Designee with
            sufficient information regarding the Services, that may be required
            in connection with the plan. Supplier shall assist in preparing the
            portion of the
<PAGE>
            transition plan detailing Supplier's responsibilities, including
            schedules and resource commitments.

      (c)   Subject to Section 20 of the Agreement, Supplier shall provide
            reasonable cooperation and information to PacifiCare, or its
            Designee, upon PacifiCare's request, to assist PacifiCare, or its
            Designee, in assuming responsibility for, the Services in an orderly
            manner.

      (d)   Subject to Section 20 of the Agreement, Supplier shall, upon
            PacifiCare's request, provide procedures, processes, and information
            to PacifiCare and/or its Designee and such other reasonable
            cooperation and assistance, to assist in the execution of the
            transition. To the extent that such procedures, processes and
            information are Supplier Confidential Information, PacifiCare shall
            have a right to use such procedures, processes and information as
            set forth in the Agreement.

      3.    TERMINATION ASSISTANCE PERIOD SERVICES
            During the Termination Assistance Period, Supplier shall:

      (a)   Provide and coordinate the assistance to PacifiCare in notifying
            relevant third parties of the procedures to be followed prior to,
            during, and after the Termination Assistance Period.

      (b)   Provide a current listing of the full time dedicated personnel
            (third-party contractors and employees) used to provide the Services
            to determine their applicability to the transition process and
            ongoing operation and support of PacifiCare systems.

      (c)   Provide access as requested by PacifiCare to current Supplier
            personnel (employees and third-party contractors) performing the
            Services.

      (d)   Review and explain the Policies and Procedures Manual to
            PacifiCare's, or Designee's, operations staff as requested.

      (e)   Provide a copy of the security guidelines and procedures used in
            providing the Services.

      (f)   Provide applicable Service logs, reporting back twelve (12) months
            prior to the Expiration Date or Termination Date.

      (g)   Provide a copy of documentation and diagrams as maintained by
            Supplier in support of the PacifiCare Entities IT environment to the
            extent required to assist in the execution of the transition.

      (h)   Provide for the transfer of ongoing projects (including a listing of
            current and planned projects and current status, as well as all
            Supplier Equipment and Software ordered or in process).

      (i)   Cooperate with PacifiCare's transition plans and procedures.
<PAGE>
      (j)   Upon PacifiCare's request, provide PacifiCare or Designee access to
            Equipment and Software, third parties, and other resources that
            Supplier uses to provide Services, provided that, i) any such access
            does not materially interfere with Supplier's ability to provide the
            Services, including the Termination Assistance Services; and ii) the
            Designee complies with Supplier's security and confidentiality
            requirements, including execution of a confidentiality agreement
            reasonably acceptable to Supplier.

      4.    OPERATIONAL TRANSFER

      Supplier shall provide the following assistance to execute a transition of
      operational responsibility for the Services to PacifiCare or the Designee:

      a)    Identifying work volumes, current staffing levels (if transition is
            back to PacifiCare), service levels, and information on historical
            performance for the Equipment and Software over the preceding twelve
            (12) months or the longest available time such information has been
            reported to the extent that the Services were not being delivered
            for twelve months or twelve months of information is not available
            to report.

      b)    Identifying work and Projects expected to be in progress as of the
            end of the Term. With respect to such work, Supplier shall document
            current status, stabilize for continuity during transition, and
            provide a transfer of knowledge to achieve effective transfer of
            responsibilities.

      c)    Providing reasonably requested assistance to PacifiCare, or the
            Designee, in the execution of parallel monitoring, servicing, and
            testing.

      5.    RETURN OF PROPERTY

      Without limiting Supplier's obligations pursuant to Section 15.4 of the
      Agreement, upon the expiration or termination of the Agreement, Supplier
      shall return to PacifiCare any property of PacifiCare in Supplier's
      possession or under Supplier's control.

      6.    TRANSITION OF EQUIPMENT, SOFTWARE AND THIRD PARTY SERVICE CONTRACTS
            Supplier shall provide PacifiCare or Designee with:

      a)    A list of all, the Software and Equipment, third party service
            contracts, and related supplier personnel contacts used by Supplier
            solely to perform the Services;

      b)    In relation to the Software and Equipment, a brief description of
            its functionality, the applicable supplier, and estimate of the cost
            to PacifiCare of continuing to use: i) the Software and Equipment,
            and ii) related third party service contracts.

      c)    Any other relevant information related to the Services as reasonably
            requested by PacifiCare.
<PAGE>
      7.    DISASTER RECOVERY TRANSFER

      Supplier shall, to the extent that disaster recovery coverage is
      contracted under the Agreement:

      (a)   Supply documentation used by Supplier to provide disaster recovery
            services for PacifiCare based on the PacifiCare Disaster Recovery
            Plan, including the most current version of disaster recovery plans,
            passwords, access codes, testing procedures and frequencies,
            redundancy programs and plans.

      8.    PAYMENT

      Payment for all services in this Schedule 26.1 shall be as set forth
      within the following framework:

      (a)   With respect to any Supplier Equipment that is owned or leased by
            Supplier and which on the date of expiration or termination Supplier
            is using on a dedicated basis to perform the Services, Supplier
            shall, or shall permit PacifiCare to (as applicable), do the
            following: (i) with respect to Supplier Equipment that is owned by
            Supplier, PacifiCare shall have the option to purchase such
            dedicated Equipment from Supplier, and if PacifiCare elects to
            purchase the Supplier-owned Equipment, PacifiCare shall pay Supplier
            the fair market value for such Equipment, as determined by an
            appraisal conducted by a mutually agreed-upon appraiser.; and (ii)
            with respect to leased Supplier Equipment, PacifiCare may, at its
            option, assume the leases associated with certain leased Supplier
            Equipment (including the financial and administrative responsibility
            associated with such leases) to the extent allowed by such leases,
            and Supplier shall use reasonable efforts to assist Supplier in
            assuming such leases.

      (b)   Without limiting Supplier's obligations pursuant to Section 26.3(e),
            upon PacifiCare's request, with respect to any generally available
            one-time charge Software which on the date of expiration or
            termination of this Agreement Supplier is using solely to provide
            the Services to PacifiCare, Supplier shall assign to PacifiCare
            Supplier's license to the Software subject to the recovery of any
            un-amortized costs (in accordance with GAAP) of the one-time
            license. Upon PacifiCare's request with respect to any generally
            available Software Supplier is using to provide Services to
            PacifiCare and other customers in a shared environment on the date
            of expiration or termination of this Agreement, Supplier shall
            provide reasonable assistance to PacifiCare in obtaining licenses
            for such Software.

      (c)   Upon PacifiCare's request, and without limitation of any other
            Supplier obligations under this Agreement, Supplier shall provide to
            PacifiCare copies of software licenses and maintenance agreements
            entered into by Supplier with respect to Software which Supplier
            acquired during the Term and is used in the delivery of the
            Services.

      (d)   The appraisals described in this Section shall be paid for by
            PacifiCare; provided, however, if the Termination Assistance
            Services are being performed as a result of a termination by
            PacifiCare for cause as described in Section 24.3(a) of this
            Agreement, the appraisal shall be paid for by Supplier.<PAGE>
                                                                   EXHIBIT 10.28
                                           *** TEXT OMITTED AND FILED SEPARATELY
                                                CONFIDENTIAL TREATMENT REQUESTED
                                              UNDER 17 C.F.R.SS.SS.200.80(b)(4),
                                                            200.83 AND 240.24b-2

                    INFORMATION TECHNOLOGY SERVICES AGREEMENT

                                     BETWEEN

                         PACIFICARE HEALTH SYSTEMS, INC.

                                       AND

                                   KEANE, INC.

                                JANUARY 11, 2002

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                            PAGE
<S>                                                                         <C>
1.       DEFINITIONS AND CONSTRUCTION ...................................     1

         1.1      Definitions ...........................................     1

         1.2      Interpretation ........................................     1

         1.3      Order of Precedence ...................................     2

2.       TERM ...........................................................     2

         2.1      Initial Term ..........................................     2

         2.2      Renewal Term; Extension Period ........................     2

3.       SERVICES .......................................................     3

         3.1      Base Services .........................................     3

         3.2      Improved Technology ...................................     3

         3.3      Governmental Approvals; Changes in Laws ...............     4

         3.4      Third Party Consents ..................................     5

         3.5      Technical Architecture and Product Standards ..........     6

         3.6      Knowledge Sharing .....................................     6

         3.7      Procurement ...........................................     6

         3.8      Reports ...............................................     6

         3.9      Right to Use Third Parties ............................     8

4.       TRANSITION .....................................................     8

         4.1      Transition Services ...................................     8

         4.2      Milestones ............................................     8

5.       NEW SERVICES ...................................................     9

         5.1      New Services ..........................................     9

         5.2      Third Party Services in Connection with
                  New Services ..........................................    10

6.       PACIFICARE RESPONSIBILITIES ....................................    10

         6.1      PacifiCare Supplier Relationship Manager ..............    10

         6.2      PacifiCare Resources ..................................    10

         6.3      Use of PacifiCare Facilities ..........................    11

         6.4      Retained Staff ........................................    11

7.       THIRD PARTY AGREEMENTS .........................................    12

         7.1      Assigned Agreements ...................................    12

         7.2      Managed Agreements ....................................    12

         7.3      Performance Under Agreements ..........................    13
</TABLE>

                                       i.
<PAGE>

                                TABLE OF CONTENTS
                                   (CONTINUED)

<TABLE>
<CAPTION>
                                                                            PAGE
<S>                                                                         <C>
8.       SERVICE LEVELS .................................................    13

         8.1      Initial Base Service Levels ...........................    13

         8.2      Service Levels for New Services .......................    13

         8.3      Adjustment of Service Levels ..........................    13

         8.4      Root-Cause Analysis ...................................    14

         8.5      Measurement Tools .....................................    14

         8.6      Continuous Improvement and Best Practices .............    14

         8.7      Service Level Credits .................................    14

         8.8      Excused Performance ...................................    15

9.       PACIFICARE SATISFACTION AND BENCHMARKING .......................    15

         9.1      Satisfaction Survey ...................................    15

         9.2      Benchmarking ..........................................    15

10.      SERVICE LOCATIONS ..............................................    15

         10.1     Service Locations .....................................    15

         10.2     Safety and Security Procedures ........................    16

         10.3     Data Security .........................................    16

         10.4     Security Relating to Competitors ......................    16

11.      HUMAN RESOURCES ................................................    17

12.      SUPPLIER STAFF .................................................    17

         12.1     Supplier Client Relationship Manager ..................    17

         12.2     Key Personnel .........................................    17

         12.3     Project Staff .........................................    18

         12.4     Subcontractors ........................................    18

         12.5     Conduct of Supplier Personnel .........................    19

         12.6     Non-Competition .......................................    19

         12.7     Non-Solicitation ......................................    19

13.      MANAGEMENT AND CONTROL .........................................    20

         13.1     Steering Committee ....................................    20

         13.2     Oversight and Management Process; Relationship
                  with Infrastructure Supplier ..........................    20

         13.3     Policy & Procedures Manual ............................    22

         13.4     Change Control Procedures .............................    23
</TABLE>

                                       ii.
<PAGE>

                                TABLE OF CONTENTS
                                   (CONTINUED)

<TABLE>
<CAPTION>
                                                                            PAGE
<S>                                                                         <C>
14.      PROPRIETARY RIGHTS .............................................    23

         14.1     Background Technology .................................    23

         14.2     PacifiCare Software ...................................    23

         14.3     Supplier Software .....................................    24

         14.4     Supplier Tools ........................................    24

         14.5     Developed Software ....................................    24

         14.6     Web Development .......................................    25

         14.7     Upgrades to Software ..................................    25

15.      DATA ...........................................................    25

         15.1     Ownership of PacifiCare Data ..........................    25

         15.2     Use of PacifiCare Data ................................    25

         15.3     Correction and Reconstruction .........................    25

         15.4     Return of Data ........................................    26

16.      CONTINUED PROVISION OF SERVICES ................................    26

         16.1     Disaster Recovery Plan ................................    26

         16.2     Force Majeure .........................................    27

         16.3     Alternate Source ......................................    27

         16.4     No Payment for Unperformed Services ...................    27

         16.5     Allocation of Resources ...............................    27

17.      PAYMENTS AND INVOICING .........................................    27

         17.1     Base Fees .............................................    27

         17.2     Base Fees .............................................    28

         17.3     Variable Fees and Adjustment of Baselines .............    28

         17.4     Variable Fee Report ...................................    28

         17.5     Time of Payment .......................................    28

         17.6     Detailed Invoices .....................................    28

         17.7     Fee Dispute ...........................................    29

         17.8     Substantial Changes ...................................    29

         17.9     Adjustments to Fees ...................................    29

         17.10    Expenses ..............................................    29

         17.11    Rights of Set-Off .....................................    29

         17.12    Proration .............................................    29
</TABLE>

                                      iii.
<PAGE>

                                TABLE OF CONTENTS
                                   (CONTINUED)

<TABLE>
<CAPTION>
                                                                            PAGE
<S>                                                                         <C>
         17.13    Unused Credits ........................................    29

         17.14    [...***...] ...........................................    29

18.      TAXES ..........................................................    30

19.      AUDITS .........................................................    31

         19.1     Services ..............................................    31

         19.2     Fees ..................................................    31

         19.3     Omnibus Reconciliation Act ............................    32

         19.4     Record Retention ......................................    32

         19.5     Facilities ............................................    32

         19.6     Audit Software ........................................    32

         19.6     Relief ................................................    32

20.      CONFIDENTIALITY ................................................    33

         20.1     General Obligations ...................................    33

         20.2     Exceptions ............................................    33

         20.3     Attorney-Client Privilege .............................    33

         20.4     Unauthorized Acts .....................................    34

         20.5     Injunctive Relief .....................................    34

21.      REPRESENTATIONS AND WARRANTIES .................................    35

         21.1     By PacifiCare .........................................    35

         21.2     By Supplier ...........................................    35

         21.3     Disclaimer ............................................    36

22.      ADDITIONAL COVENANTS ...........................................    36

         22.1     By PacifiCare .........................................    36

         22.2     By Supplier ...........................................    36

23.      DISPUTE RESOLUTION .............................................    37

         23.1     Resolution Procedures .................................    37

         23.2     Exclusions ............................................    38

         23.3     Continuity of Services ................................    38

24.      TERMINATION ....................................................    38

         24.1     Termination for Convenience ...........................    38

         24.2     Termination for Change in Control .....................    38

         24.3     Termination for Cause .................................    38
</TABLE>

                                       iv.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                TABLE OF CONTENTS
                                   (CONTINUED)

<TABLE>
<CAPTION>
                                                                            PAGE
<S>                                                                         <C>
         24.4     Termination for Failure to Provide Critical Services...    39

         24.5     Insolvency ............................................    39

         24.6     Other Terminations ....................................    39

25.      TERMINATION FEES ...............................................    39

         25.1     Early Termination Fee .................................    39

         25.2     No Other Fees .........................................    39

26.      TERMINATION ASSISTANCE .........................................    40

         26.1     Termination Assistance Services .......................    40

         26.2     Termination Services Fees .............................    41

         26.3     Exit Duties and Exit Rights ...........................    41

27.      INDEMNITIES ....................................................    43

         27.1     Indemnity by PacifiCare ...............................    43

         27.2     Indemnity by Supplier .................................    43

         27.3     Indemnification Procedures ............................    45

28.      DAMAGES ........................................................    45

         28.1     Consequential Damages .................................    45

         28.2     Direct Damages ........................................    45

         28.3     Basis of the Bargain ..................................    45

         28.4     Exclusions ............................................    46

29.      INSURANCE ......................................................    46

         29.1     Types and Amounts .....................................    46

         29.2     Supplier Agents .......................................    47

         29.3     Documentation .........................................    47

         29.4     Self Insurance ........................................    47

         29.5     Intentions ............................................    48

30.      MISCELLANEOUS PROVISIONS .......................................    48

         30.1     Amendments ............................................    48

         30.2     Assignment ............................................    48

         30.3     Bankruptcy ............................................    48

         30.4     Conflict of Interest ..................................    48

         30.5     Consents, Approvals and Requests ......................    49

         30.6     Corporate Integrity ...................................    49
</TABLE>

                                       v.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                TABLE OF CONTENTS
                                   (CONTINUED)

<TABLE>
<CAPTION>
                                                                            PAGE
<S>                                                                         <C>
         30.7     Counterparts ..........................................    49

         30.8     Covenant of Further Assurances ........................    49

         30.9     Entire Agreement ......................................    49

         30.10    Export ................................................    49

         30.11    Good Faith and Fair Dealing ...........................    49

         30.12    Governing Law and Venue ...............................    50

         30.13    Notices ...............................................    50

         30.14    Publicity .............................................    51

         30.15    Relationship ..........................................    51

         30.16    Severability ..........................................    51

         30.17    Survival ..............................................    51

         30.18    Third Party Beneficiaries .............................    52

         30.19    Timing and Cumulative Remedies ........................    52

         30.20    Waivers ...............................................    52
</TABLE>

                                       vi.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                    INFORMATION TECHNOLOGY SERVICES AGREEMENT

      THIS INFORMATION TECHNOLOGY SERVICES AGREEMENT (the "AGREEMENT"), dated as
of January 11, 2002 (the "EFFECTIVE DATE"), is between PACIFICARE HEALTH
SYSTEMS, INC., a Delaware corporation with its principal place of business at
3120 W. Lake Center Drive, Santa Ana, California, 92704 ("PACIFICARE"), and
KEANE, INC., a Massachusetts corporation with its principal place of business at
Ten City Square, Boston, Massachusetts 02129 ("SUPPLIER").

                                    RECITALS

      WHEREAS, the PacifiCare Entities (as defined below) currently receive
information technology ("IT"), data processing and related services from
internal staff and certain third party providers;

      WHEREAS, the PacifiCare Entities desire to centralize the delivery of IT
services to maximize efficiency, improve the speed of delivering IT solutions
for new business opportunities and improve IT service levels;

      WHEREAS, PacifiCare desires for the PacifiCare Entities to obtain from
Supplier and International Business Machines Corporation, a New York corporation
(the "INFRASTRUCTURE SUPPLIER"), and Supplier desires to provide to the
PacifiCare Entities, in cooperation with the Infrastructure Supplier, certain
IT, data processing and related services whereby the PacifiCare Entities shall
be provided with a stable and robust operating environment with sufficient
capacity and scalability to meet business objectives on a proactive, rather than
reactive, basis, in accordance with the terms and conditions of this Agreement;
and

      WHEREAS, PacifiCare and Supplier have engaged in extensive negotiations
and discussions that have culminated in the formation of the relationship
described in this Agreement whereby Supplier shall provide to PacifiCare
Entities certain IT, data processing and related services, in accordance with
the terms and conditions of this Agreement.

      NOW, THEREFORE, for and in consideration of the agreements set forth
below, PacifiCare and Supplier agree as follows:

                                    AGREEMENT

1.    DEFINITIONS AND CONSTRUCTION.

      1.1 DEFINITIONS. Capitalized terms used in this Agreement shall have the
meanings set forth in EXHIBIT A.

      1.2 INTERPRETATION.

            (a) The schedules and exhibits attached to this Agreement are hereby
incorporated into and deemed part of this Agreement and all references to
"Agreement" include the schedules and exhibits to this Agreement.

<PAGE>

            (b) The headings preceding the text of sections, the headings to
schedules and exhibits, the table of contents and the table of schedules
included in or attached to this Agreement are used for convenience only and are
not to be considered in construing or interpreting this Agreement.

            (c) The use of the terms "including," "include" or "includes" shall
in all cases herein mean "including without limitation," "include without
limitation" or "includes without limitation," respectively.

            (d) Words importing the singular include the plural and words
importing the masculine include the feminine and vice versa where the context so
requires.

            (e) References to any Law shall mean references to the Law as it
exists on the Effective Date as well as in changed or supplemented form or to a
newly adopted Law.

            (f) The Parties acknowledge and agree that they have mutually
negotiated the terms and conditions of this Agreement and that any provision
contained herein with respect to which an issue of interpretation or
construction arises shall not be construed to the detriment of the drafter on
the basis that such Party or its professional advisor was the drafter, but shall
be construed according to the intent of the Parties as evidenced by the entire
Agreement.

      1.3 ORDER OF PRECEDENCE. Except as otherwise expressly set forth in the
body of this Agreement or in any schedules or exhibits, in the event of a
conflict, ambiguity or inconsistency between the provisions in the body of this
Agreement and any schedule or exhibit, the provisions in the body of this
Agreement shall prevail.

2.    TERM.

      2.1 INITIAL TERM. The initial term of this Agreement (the "INITIAL TERM")
shall commence on the Effective Date and continue until 23:59 (Pacific Time) on
March 9, 2012 (the "INITIAL TERM EXPIRATION DATE"), or such earlier date upon
which this Agreement may be terminated in accordance with the provisions hereof.

      2.2 RENEWAL TERM; EXTENSION PERIOD.

            (a) Unless this Agreement is terminated in accordance with the
provisions hereof, PacifiCare shall notify Supplier at least one hundred eighty
(180) days prior to the Initial Term Expiration Date as to whether or not
PacifiCare desires to renew this Agreement. If PacifiCare provides Supplier with
notice that PacifiCare desires to renew this Agreement for a specified period
(the "RENEWAL TERM") and the Parties agree on the terms and conditions
applicable to the Renewal Term at least sixty (60) days prior to the Initial
Term Expiration Date, then this Agreement shall continue in effect beyond the
Initial Term Expiration Date in accordance with the terms and conditions agreed
upon by the Parties for the Renewal Term. If PacifiCare provides Supplier with
notice that PacifiCare does not desire to renew this Agreement, this Agreement
shall expire on the Initial Term Expiration Date, subject to Supplier's
obligation to provide Termination Assistance Services as set forth in this
Agreement.

                                       2.
<PAGE>

            (b) If PacifiCare provides Supplier with notice that PacifiCare
desires to renew this Agreement and the Parties have not agreed on the terms and
conditions applicable to a Renewal Term at least sixty (60) days prior to the
Initial Term Expiration Date, then the term of this Agreement shall extend for a
period determined by PacifiCare of up to twelve (12) months beyond the Initial
Term Expiration Date (the "EXTENSION PERIOD"), at the charges, terms and
conditions in effect as of the Initial Term Expiration Date subject to a cost of
living adjustment as set forth in Schedule 17. If, during the Extension Period,
the Parties are able to reach agreement on the terms and conditions applicable
to a Renewal Term, then this Agreement shall continue in effect beyond the end
of the Extension Period in accordance with the terms and conditions agreed upon
by the Parties for the Renewal Term, and agreed upon pricing for the Renewal
Term will be applied retroactively to the Extension Period. If, during the
Extension Period, the Parties are unable to reach agreement on the terms and
conditions applicable to a Renewal Term, this Agreement shall expire at the end
of the Extension Period, subject to Supplier's obligation to provide Termination
Assistance Services as set forth in this Agreement.

3.    SERVICES.

      3.1 BASE SERVICES. Commencing on the Cutover Date and continuing
throughout the Term, Supplier shall be responsible for providing to PacifiCare
Entities (with respect to each PacifiCare Entity, as requested by PacifiCare)
the following services (collectively, the "BASE SERVICES"):

            (a) the services, functions and responsibilities described in this
Agreement (including the services, functions, responsibilities and projects
described in EXHIBIT B);

            (b) the application systems maintenance and enhancement services,
functions and responsibilities being performed during the twelve (12) month
period prior to the Cutover Date by the Affected Contractors set forth in
Schedule 3.1(b)(i) and the Affected Employees set forth in Schedule 3.1(b)(ii),
even if the service, function or responsibility is not specifically described in
this Agreement;

            (c) any application systems maintenance and enhancement services,
functions or responsibilities that are not specifically described in this
Agreement, but that are required for the proper performance and delivery of the
Services; and

            (d) those services otherwise identified in this Agreement as part of
the Base Services.

      Subject to Section 17.3 and Section 17.8, Supplier shall increase or
decrease the amount of the Base Services according to PacifiCare's request for
the Base Services. With respect to additional business units or entities that
PacifiCare may designate as PacifiCare Included Affiliates, PacifiCare and
Supplier shall negotiate in good faith any applicable transition fees, if any,
to compensate Supplier for any material costs associated with Supplier's
provision of the Services to such PacifiCare Included Affiliates, and to the
extent the provision of the Services to such additional PacifiCare Included
Affiliates requires a material change in the delivery of the Services,
PacifiCare and Supplier shall negotiate in good faith applicable adjustments to
the Fees and Service Levels. Notwithstanding the foregoing, PacifiCare shall not
be obligated to obtain

                                       3.
<PAGE>

any Services from Supplier with respect to any additional entity or business
unit or in connection with any acquisition or corporate combination.

      3.2 IMPROVED TECHNOLOGY. Commencing on the Cutover Date and continuing
throughout the Term and, if applicable, in accordance with the Change Control
Procedure, Supplier shall: (a) provide the Services using application management
methodologies and processes that (i) allows the PacifiCare Entities to take
advantage of technological advances in order to facilitate PacifiCare's goal to
remain competitive in the markets that the PacifiCare Entities serve, (ii) are
at least current with the methodologies and processes that Supplier uses in
providing services to its other customers who receive services substantially
comparable to the Services, and (iii) are consistent with the current level of
technology generally adopted from time to time in the PacifiCare Entities'
industries; (b) jointly, with PacifiCare, continually identify and evaluate the
least cost/highest benefit methods to implement technology advancements and
improved application management methodologies and processes that represent
advancements, improved methods, and processes in addition to the level of
technology evolution, advancement and improvement otherwise contemplated by this
Agreement (collectively, "IMPROVED TECHNOLOGY"); (c) implement such Improved
Technology after obtaining PacifiCare's consent thereto (implementation of which
shall be effectuated pursuant to Section 5.1, as agreed by the Parties); and (d)
meet with PacifiCare, upon PacifiCare's request and at least once during every
ninety (90)-day period, in accordance with the procedures agreed upon by the
PacifiCare Supplier Relationship Manager and the Supplier Client Relationship
Manager, to inform PacifiCare of any Improved Technology Supplier is developing
or technology and application management trends or directions Supplier, in the
ordinary course of its business, is aware of, that could reasonably be expected
to have an impact on PacifiCare Entities' business, taking into consideration
the PacifiCare Entities' use of the Services; provided that if the disclosure of
any such Improved Technology are subject to binding nondisclosure agreements
between Supplier and a third party, Supplier shall comply with such agreements
and only provide information regarding such Improved Technology to the extent
permitted by such agreements.

      3.3 GOVERNMENTAL APPROVALS; CHANGES IN LAWS.

            (a) GOVERNMENTAL APPROVALS. PacifiCare shall, at its own cost and
expense, obtain and maintain all licenses, approvals, permits, consents and
authorizations of any Governmental Authority, and provide any notice to any
Governmental Authority, that PacifiCare is required by Law to obtain, maintain,
or provide, other than Supplier Governmental Approvals ("PACIFICARE GOVERNMENTAL
APPROVALS"). Supplier shall, at its own cost and expense, obtain and maintain
all licenses, approvals, permits, consents and authorizations of any
Governmental Authority, and provide any notice to any Governmental Authority,
that Supplier is required by Law to obtain, maintain, or provide, together with
any licenses, approvals, permits, consents, authorizations and notices required
by Law in connection with or as a result of the provision or receipt of the
Services ("SUPPLIER GOVERNMENTAL APPROVALS").

            (b) CHANGES IN SUPPLIER LAWS AND PACIFICARE LAWS. PacifiCare shall
monitor and promptly identify and notify Supplier of all changes in Laws
applicable to

                                       4.
<PAGE>

PacifiCare that affect the provision or receipt of the Services, other than
Supplier Laws ("PACIFICARE LAWS"). Supplier shall monitor and promptly identify
and notify PacifiCare of (i) all changes in Laws applicable to Supplier that
affect the provision or receipt of the Services, together with (ii) any changes
in Laws applicable to either Party that apply to the provision or receipt of
information technology outsourcing services and that affect the PacifiCare
Entities or the provision or receipt of the Services ("SUPPLIER LAWS").

            (c) EFFECT OF CHANGES IN LAWS. Supplier and PacifiCare shall work
together to identify the effect of changes in Laws on the provision or receipt
of the Services. PacifiCare shall notify Supplier of changes in PacifiCare Laws
and the Parties shall discuss modifications to the Services, if any, necessary
to comply with such changes in PacifiCare Laws. Supplier shall promptly
thereafter propose any adjustment to the applicable Fees associated with such
modifications. Upon PacifiCare's consent, Supplier shall implement such
modifications to the Services in a timely manner subject to the Change Control
Procedures. Supplier shall notify PacifiCare of changes in Supplier Laws and
Supplier shall implement in a timely manner, at its own cost and expense, any
changes in the Services required to comply with such changes in Supplier Laws,
provided, however, that if a change in the Services required to comply with a
Supplier Law will have a material effect on the provision or receipt of the
Services, Supplier shall obtain PacifiCare's consent before implementing such
change. Notwithstanding the foregoing, if a Supplier Law referenced in Section
3.3(b)(ii) above requires changes to the applications functionality provided as
part of the Services, then Supplier shall propose to PacifiCare a plan to
implement such changes to the applications functionality (including the cost and
expense of such changes), and upon PacifiCare's consent, Supplier shall
implement the plan and PacifiCare shall pay the cost and expense of such plan.

      3.4 THIRD PARTY CONSENTS.

            (a) PacifiCare shall obtain the Front-End Consents, and Supplier
shall cooperate with PacifiCare in obtaining any Front-End Consent upon
PacifiCare's request. [...***...] In the event that PacifiCare is unable to
obtain a Front-End Consent, Supplier shall, at PacifiCare's expense, develop and
implement a workaround that shall enable Supplier to perform Supplier's
obligations under this Agreement. Each Party shall comply with the terms and
conditions of the Consents that are applicable to such Party.

            (b) Before providing any Supplier Software subject to a Back-End
Consent to PacifiCare, Supplier shall have used commercially reasonable efforts
to obtain from the provider of such Supplier Software the right to provide such
Supplier Software to PacifiCare in

                                       5.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

accordance with this Agreement, and, if applicable, the right to assign such
Supplier Software to PacifiCare in accordance with Section 26.3. If Supplier has
not obtained the rights set forth in the preceding sentence, Supplier shall
first notify and obtain the consent of the PacifiCare Supplier Relationship
Manager before providing such Supplier Software to PacifiCare pursuant to this
Agreement.

      3.5 TECHNICAL ARCHITECTURE AND PRODUCT STANDARDS. Supplier shall comply
with PacifiCare's information management technical architecture and product
standards set forth in Schedule 3.5, as the same may be modified through the
Change Control Procedures by PacifiCare from time to time during the Term and
the Termination Assistance Period.

      3.6 KNOWLEDGE SHARING. At least once every Contract Year, or upon request
after at least fifteen (15) days notice from PacifiCare, Supplier shall provide,
at mutually-agreeable times and locations, knowledge sharing assistance to
PacifiCare, including meeting with representatives of PacifiCare in order to
explain how the Systems work and should be operated and how the Services are
provided. Supplier shall also provide, at mutually agreeable times and
locations, such training and documentation as PacifiCare may require for
PacifiCare to understand, operate, maintain and enhance the Systems and
understand and provide the Services.

      3.7 PROCUREMENT.

            (a) BREAK/FIX AND TECHNOLOGY REFRESH. As part of the Base Services,
Supplier is responsible for procurement activities and charges for break/fix and
technology refresh, in each case, as described in EXHIBIT B.

            (b) NEW SERVICES AND PROJECTS. Whenever PacifiCare agrees to engage
Supplier to provide New Services that include any projects requiring the
procurement and deployment of any New Software that is not included in the Base
Services, then, at PacifiCare's request and in accordance with the Policy &
Procedures Manual, Supplier shall (i) identify suppliers with the most favorable
terms (including the lowest cost) available to Supplier for any New Software and
(ii) upon PacifiCare's request, (x) purchase the New Software on behalf of
PacifiCare, (y) lease, or arrange for a third party to lease, such New Software
to PacifiCare or (z) license, or arrange for a third party to license, such New
Software to PacifiCare. PacifiCare shall pay to Supplier, the supplier, third
party lessor or third party licensor, as applicable, the purchase, lease or
license fees, as applicable, in respect of the New Software. Except as otherwise
agreed in writing by the Parties or as otherwise provided in this Agreement, all
rights in and title to any New Software purchased by Supplier on behalf of
PacifiCare and paid for by PacifiCare shall belong to PacifiCare and all New
Software shall be new.

      3.8 REPORTS.

            (a) ANNUAL PLAN.

                  (i) In a mutually agreeable timeframe consistent with
PacifiCare's iterative budgeting process, PacifiCare shall provide to Supplier a
list of PacifiCare's projected projects for the subsequent calendar year (the
"PACIFICARE PROJECTED PROJECT LIST"). After

                                       6.
<PAGE>

receipt of the PacifiCare Projected Project List, Supplier shall provide to
PacifiCare a written response to the PacifiCare Projected Project List in a
mutually agreed upon timeframe detailing the Resource Units (for example
Billable Hours and FTPs) necessary for Supplier to meet the PacifiCare Projected
Project List ("SUPPLIER'S PROJECTED RESOURCE UNITS"). After receipt of
Supplier's Projected Resource Units, PacifiCare shall provide to Supplier in a
timeframe consistent with PacifiCare's budgeting process a projected development
plan for projected PacifiCare projects for the subsequent calendar year
including a high level description of the proposed projects and the scheduling
of the proposed projects (the "PACIFICARE PROJECTED DEVELOPMENT PLAN").

                  (ii) Supplier shall provide to PacifiCare its written response
to the PacifiCare Projected Development Plan in mutually agreed upon timeframe
("SUPPLIER'S REPLY"). Where appropriate, Supplier's Reply shall address:
technology strategies, operational plans (as necessary) and any program
management changes; changes to standard configurations for hardware, software,
networks and systems; changes within the organization, including new employees
and new subcontractors; changes in geographical location of subcontractors;
updates to the Fees including any retained expenses, Base Fees, ARC Rates and
RRC Rates; changes in the Base Services; changes in Service Levels and Service
Level Credits; changes to the Baselines; proposed performance changes, hardware
or software procurement in support of the proposed projects, costs associated
with such hardware or software procurement (including maintenance costs) and new
or added value projects.

                  (iii) In a mutually agreed upon timeframe, and after
PacifiCare's receipt of Supplier's Reply, the Parties shall formulate a written
plan to meet PacifiCare's anticipated needs for the subsequent calendar year
(the "ANNUAL PLAN"). The Parties shall use good faith efforts to review, approve
and adopt the Annual Plan prior to the end of each calendar year. After the
Annual Plan is adopted, the Parties may negotiate in good faith to make
equitable adjustments as necessary. Such equitable adjustments shall be in
writing and signed by both Parties.

                  (iv) In conjunction with PacifiCare's budgeting process and in
a mutually agreed upon timeframe, Supplier shall provide the following proposals
to PacifiCare.

                        (1) Supplier may provide a proposal to PacifiCare that
recommends relocation of particular functions or Services to one or more
Supplier ADCs, in order to improve quality or cost-effectiveness of the delivery
of Services. Such Supplier ADCs may be Near-Shore ADCs, Offshore ADCs, or
Domestic ADCs. Supplier's proposal will provide, to the extent applicable, (i)
any revised Base Fees that account for the impact of delivery at such Supplier
ADC; (ii) ARC and RRC setting forth pricing differences among current and
proposed delivery locations; (iii) any proposed transition fees for the
migration of applicable functions or Services to the Supplier ADC; and (iv) any
other fees, expenses, or costs to PacifiCare related to the relocation to or the
provision of Services from the applicable Supplier ADC. PacifiCare may, in its
sole discretion, approve or reject any proposal submitted pursuant to this
Section. For purposes of this Agreement, "DOMESTIC ADC" means any Supplier ADC
located in the United States, "NEAR-SHORE ADC" means any Supplier ADC located in
Canada, and "OFFSHORE ADC" means any Supplier ADC not located in the United
States or Canada.

                                       7.
<PAGE>

                  (v) Supplier shall provide a proposal to PacifiCare that
recommends New Development, the implementation of new technology, automation,
improvements in productivity, technology or application enhancements or changes
and other enhancements relating to the Services or the Applications ("PROPOSED
DEVELOPMENT"). Such proposal shall include for each Proposed Development
descriptions of and rationales for the Proposed Development, estimates of
related Resource Units necessary for Supplier to perform the Proposed
Development, any new or non-standard resources necessary for Supplier to perform
the Proposed Development, hardware or software procurement in support of the
Proposed Development and impacts of the Proposed Development on any Fees
including ARC Rates and RRC Rates. Supplier shall discuss the Proposed
Development with PacifiCare using an iterative process and shall provide
additional information as reasonably necessary for PacifiCare to adequately
review the Proposed Development. PacifiCare may in its sole discretion approve
or reject any Proposed Development.

            (b) In addition to the Annual Plan, Supplier shall provide to
PacifiCare, in a format approved by PacifiCare, a set of reports, including
performance, billing and status reports, as set forth in Schedule 3.8(b) and as
otherwise reasonably available to Supplier. Supplier shall provide all reports
as set forth in Schedule 3.8(b) or as PacifiCare reasonably requires.

      3.9 RIGHT TO USE THIRD PARTIES. PacifiCare may perform itself, or contract
with one or more third parties to perform all or any portion of the Services,
subject to appropriate adjustments to the Base Fees in accordance with and
subject to the provisions of Sections 17.3 and 17.8. If PacifiCare performs
itself, or engages a third party to provide, Services under this Agreement,
Supplier agrees, in accordance with the Change Control Procedures, to cooperate
in good faith with PacifiCare and/or any such third party to the extent
reasonably required by PacifiCare, including provision of (a) written
requirements, standards, and procedures for PacifiCare systems maintained by
Supplier so that the enhancements or developments of such third party may be
operated in conjunction with Services, (b) assistance and support services to
such third party at competitive market prices and (c) access to the Software as
may be reasonably required by such third party and PacifiCare in connection with
Services.

4.    TRANSITION.

      4.1 TRANSITION SERVICES. Supplier shall perform all application systems
maintenance and enhancement functions identified as Supplier's responsibility on
Schedule 4.1 on or before the last day of the Transition Period (the "TRANSITION
SERVICES"). The Transition Services shall be performed in accordance with and as
defined in the Transition Plan attached hereto as Schedule 4.1 and without
causing a material disruption to the PacifiCare Entities' business. The
Transition Services shall commence on the Cutover Date and shall continue for
the period specified in the Transition Plan (the "TRANSITION PERIOD"). Supplier
shall designate one of its Key Personnel (as defined in Section 12.2), and
notify PacifiCare of the identity of such individual, for each of the PacifiCare
Entities' facilities and functions being transitioned in accordance with this
Agreement who shall be responsible for managing and implementing the Transition
Services with respect to such functions or services. Until the completion of the
applicable Transition Services and as often as may be requested by the
PacifiCare Supplier

                                       8.
<PAGE>

Relationship Manager, each such individual shall review with the PacifiCare
Supplier Relationship Manager the status of the Transition Services for which
that individual is responsible.

      4.2 MILESTONES. The Transition Plan and Schedule 4.2 includes a list of
milestones and deliverables that Supplier is responsible to perform and deliver
to PacifiCare and which relates to Supplier's obligations pursuant to this
Section 4, together with, for each such milestone or deliverable, (a) a
description of the applicable triggering event from which achievement of such
milestone or delivery of such deliverable shall be measured, (b) the time period
after the triggering event in which Supplier must complete such milestone or
deliver such deliverable, (c) the criteria against which to determine whether
Supplier has completed such milestone or delivered the deliverable, and (d) an
amount of the Base Fees subject to Service Level Credits in relation to such
milestone or deliverable. PacifiCare's right to receive Service Level Credits
under the Transition Plan shall not limit PacifiCare's right to recover other
damages incurred by PacifiCare as a result of the performance failure by
Supplier with regard to those Transition Services set forth in the Transition
Plan which are designated as Supplier primary responsibilities and that caused
the Service Level Credit to be incurred [...***...]

5.    NEW SERVICES.

      5.1 NEW SERVICES. Commencing on the Cutover Date PacifiCare may, from time
to time during the Term, request that Supplier perform a New Service. Promptly
upon receipt of such a request from PacifiCare, Supplier shall provide, and to
the extent applicable, shall cooperate with the Infrastructure Supplier to
jointly provide, a written proposal to PacifiCare for such New Service that
shall include:

            (a) a description of the services, functions and responsibilities
Supplier anticipates performing in connection with such New Service;

            (b) a schedule for commencing and completing such New Service;

            (c) Supplier's prospective fees for such New Service, including a
detailed breakdown of such fees, together with proposed corresponding Service
Levels for such New Services ("NEW SERVICES SERVICE LEVELS");

            (d) when appropriate, a description of any new Software or Equipment
to be provided by Supplier, Infrastructure Supplier or PacifiCare in connection
with such New Service;

                                       9.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

            (e) when appropriate, the Software and Equipment and run-time
requirements necessary to develop and operate any new Software;

            (f) a description of the human resources necessary to provide the
New Service;

            (g) when appropriate, a list of any existing Software or Equipment
included in or to be used in connection with such New Service;

            (h) when appropriate, acceptance test criteria and procedures for
any New Software or any products, packages or services; and

            (i) such other information requested by PacifiCare.

            PacifiCare shall not be obligated to pay for any New Service and
Supplier shall not be obligated to perform any New Service until the PacifiCare
Supplier Relationship Manager has provided Supplier with the authorization to
perform the New Service.

      5.2 THIRD PARTY SERVICES IN CONNECTION WITH NEW SERVICES. Notwithstanding
any request made by PacifiCare to Supplier pursuant to Section 5.1 or any other
provision in this Agreement, PacifiCare shall have the right to perform itself,
or to contract with a third party to perform, any New Service. Upon PacifiCare's
request, Supplier shall assist PacifiCare in identifying qualified third party
suppliers to provide New Services. In the event PacifiCare performs itself, or
contracts with a third party to perform, any New Service, Supplier shall
cooperate in good faith with PacifiCare and/or any such third party to the
extent reasonably required by PacifiCare. If such cooperation related to third
parties is not subject to a Managed Agreement and requires Supplier to utilize
resources not included within the Fees, then Supplier shall, prior to providing
such cooperation and in accordance with the Change Control Procedures, notify
PacifiCare that Supplier believes that Supplier is entitled to additional
compensation for providing such cooperation and advise PacifiCare of any
proposed additional compensation for Supplier. The amount of any such additional
compensation applicable to such cooperation shall be based on, and in accordance
with, the Fees, and agreed to by the Parties. Without prejudice to PacifiCare's
right to source any New Service to third parties, PacifiCare will consider
Supplier to provide the maintenance of future new applications under the
Agreement, provided that PacifiCare does not elect to source the maintenance of
such new applications to the third party who developed the applications.

6.    PACIFICARE RESPONSIBILITIES.

      6.1 PACIFICARE SUPPLIER RELATIONSHIP MANAGER. PacifiCare shall appoint the
PacifiCare Supplier Relationship Manager who, from the Effective Date, shall
serve as the primary PacifiCare representative under this Agreement ("PACIFICARE
SUPPLIER RELATIONSHIP MANAGER"). The PacifiCare Supplier Relationship Manager
shall (a) have overall responsibility for managing and coordinating the
performance of PacifiCare's obligations under this Agreement and (b) be
authorized to act for and on behalf of the PacifiCare Entities with respect to
all matters relating to this Agreement. Notwithstanding the foregoing, the
PacifiCare Supplier

                                      10.
<PAGE>

Relationship Manager may, upon notice to Supplier, delegate such of his or her
responsibilities to other PacifiCare employees as the PacifiCare Supplier
Relationship Manager deems appropriate.

      6.2 PACIFICARE RESOURCES. Commencing on the Effective Date and continuing
during the Term, PacifiCare shall provide to Supplier, at no charge to Supplier
and subject to Section 6.3, the same or similar access to and use of certain
space in PacifiCare's premises, together with reasonable office furnishings,
janitorial services, land-line telephones, workstations, computers, parking,
access to servers, printers, systems, utilities, and reasonable office supplies,
in each case, to the same extent that PacifiCare otherwise provides to its
employees and subcontractors performing similar work for PacifiCare at such
facilities. Supplier's use of such premises shall be in accordance with
PacifiCare's policies and procedures in effect from time to time.

      6.3 USE OF PACIFICARE FACILITIES.

            (a) Except as expressly provided in this Agreement, Supplier shall
use the PacifiCare Service Locations for the sole and exclusive purpose of
providing the Services. Use of such facilities by Supplier does not constitute a
leasehold interest in favor of Supplier or any of Supplier's customers. Use of
PacifiCare Service Locations shall be subject to the Facilities Space
Requirements and Rules & Regulations attached as Schedule 6.3(a).

            (b) Supplier shall use the PacifiCare Service Locations in an
efficient manner. To the extent that Supplier operates the space in a manner
that unnecessarily and materially increases facility costs incurred by
PacifiCare, PacifiCare shall notify Supplier of such costs and Supplier shall
implement corrective action, provided, however, that PacifiCare reserves the
right to set-off such excess costs if Supplier fails to take prompt corrective
action.

            (c) Supplier and Supplier Agents shall keep the PacifiCare Service
Locations in good order, not commit or permit waste or damage to such
facilities, not use such facilities for any unlawful purpose or act and shall
comply with the PacifiCare Entities' standard and site-specific policies and
procedures (including physical security procedures) as in effect from time to
time and made available to Supplier at the URL designated by PacifiCare for such
purpose.

            (d) Supplier shall permit PacifiCare Entities and PacifiCare Entity
Agents to enter into those portions of the PacifiCare Service Locations occupied
by Supplier's staff at any reasonable time to perform facilities-related
services.

            (e) Supplier shall not make any improvements or changes involving
structural, mechanical or electrical alterations to the PacifiCare Service
Locations without PacifiCare's prior consent. Any additions, improvements or
changes made by Supplier shall be deemed the property of PacifiCare without
further consideration.

            (f) When the PacifiCare Service Locations are no longer required for
performance of the Services, Supplier shall return such locations to PacifiCare
in substantially

                                      11.
<PAGE>

the same condition as when Supplier began using such locations, ordinary wear
and tear excepted.

      6.4 RETAINED STAFF. Commencing upon the Cutover Date and continuing for
three (3) months thereafter, PacifiCare and the PacifiCare Entities shall
provide Supplier with reasonable access to certain members of PacifiCare's or
the PacifiCare Entities' retained staff who were responsible for performing the
Base Services prior to the Effective Date for the purpose of knowledge transfer
from PacifiCare to Supplier, as reasonably requested by Supplier and at mutually
agreed upon times and locations. In addition, commencing upon the Cutover Date
and continuing for twelve (12) months thereafter, PacifiCare will assist
Supplier by providing Supplier with reasonable access to the retained Affected
Contractors who were responsible for performing the Base Services prior to the
Cutover Date and who remain engaged by PacifiCare for the purpose of knowledge
transfer from PacifiCare to Supplier.

7.    THIRD PARTY AGREEMENTS.

      7.1 ASSIGNED AGREEMENTS. As of Cutover Date, Supplier shall assume all
responsibility (including all obligations and post assignment liability) for the
Assigned Agreements as set forth in Schedule 7.1.

            (a) Ongoing Responsibilities. Supplier may, to the extent permitted
by any Assigned Agreement, renew, modify, terminate or cancel, or request or
grant any consents or waivers under, any such Assigned Agreement. Supplier shall
have financial and administrative responsibility with respect to the Assigned
Agreements, including responsibility for performance of all obligations under
the Assigned Agreements.

            (b) Assigned Agreement Invoices. Supplier shall be responsible for
payment of invoiced amounts submitted by third parties for expenses incurred on
or after the Cutover Date pursuant to the Assigned Agreements, including any
late fees in respect of such third party invoices. If PacifiCare receives any
invoices for amounts incurred under the Assigned Agreement invoices after the
Cutover Date, PacifiCare shall provide those invoices to Supplier within a
reasonable time period to permit timely payment by Supplier. PacifiCare shall be
responsible for any late fees attributable to PacifiCare's failure to provide
such invoices to Supplier within a reasonable time period to permit timely
payment by Supplier. If, prior to the Cutover Date, PacifiCare prepaid any
amounts under any Assigned Agreements that are attributable to amounts incurred
on or after the Cutover Date, then Supplier shall reimburse or credit PacifiCare
for such amounts on the next invoice delivered by Supplier for the Services. In
the event Supplier receives during the Term any refund, credit or other rebate
(including deposits) in connection with any Assigned Agreement that is
attributable to periods prior to the Cutover Date, then Supplier shall promptly
notify PacifiCare of such refund, credit or rebate and shall promptly pay to
PacifiCare the full amount of such refund, credit or rebate.

                                      12.
<PAGE>

      7.2 MANAGED AGREEMENTS. At all times on or after the Cutover Date and
during the Term, Supplier shall manage, administer and maintain the Managed
Agreements set forth in Schedule 7.2. Supplier's responsibilities shall include
receipt of invoices and coordination of third party services under the Managed
Agreements.

            (a) ONGOING RESPONSIBILITIES. Supplier shall have administrative
(but not financial) responsibility at all times on or after the Cutover Date and
during the Term with respect to the Managed Agreements, and Supplier shall
provide PacifiCare with reasonable notice of all renewal, termination or
cancellation dates and fees with respect to the Managed Agreements. Supplier
shall not renew, modify, terminate or cancel, or request or grant any consents
or waivers under, any Managed Agreements without the consent of the PacifiCare
Supplier Relationship Manager. Supplier shall pay or discharge, as applicable,
any fees or charges or other liability or obligation imposed upon PacifiCare in
connection with (i) any such renewal, modification, termination or cancellation
of, or consent or waiver under, the Managed Agreements, obtained or given
without PacifiCare's consent as required under the foregoing sentence or (ii)
Supplier's failure to comply with the terms of the Managed Agreements.

            (b) MANAGED AGREEMENT INVOICES. Supplier shall (i) receive all
Managed Agreement Invoices, (ii) review and correct any errors in any such
Managed Agreement Invoices in a timely manner and (iii) submit such Managed
Agreement Invoices to PacifiCare within a reasonable period of time prior to the
due date or, if a discount for payment is offered, the date on which PacifiCare
may pay such Managed Agreement Invoice with a discount. PacifiCare shall pay the
Managed Agreement Invoices received and approved by Supplier. PacifiCare shall
only be responsible for payment of the Managed Agreement Invoices and shall not
be responsible to Supplier for any management, administration or maintenance
fees of Supplier in connection with the Managed Agreement Invoices. PacifiCare
shall be responsible for any late fees in respect of the Managed Agreement
Invoices, provided that Supplier submitted the applicable Managed Agreement
Invoices to PacifiCare for payment within a reasonable period of time prior to
the date any such Managed Agreement Invoice is due, but in any event within
three (3) business days of Supplier's receipt of such Managed Agreement Invoice.
If Supplier fails to submit a Managed Agreement Invoice to PacifiCare for
payment in accordance with the preceding sentence, Supplier shall be responsible
for any discount not received or any late fees in respect of such Managed
Agreement Invoice.

      7.3 PERFORMANCE UNDER AGREEMENTS. Supplier and PacifiCare shall promptly
notify each other of any breach of, or misuse or fraud in connection with, any
PacifiCare Third Party Contracts of which such Party becomes aware, or should
reasonably be aware, and shall cooperate with the other Party to prevent or stay
any such breach, misuse or fraud. Supplier shall pay all amounts due for any
penalties or charges (including amounts due to a third party as a result of
Supplier's failure to promptly notify PacifiCare pursuant to the preceding
sentence), associated taxes, legal expenses and other incidental expenses
incurred by PacifiCare as a result of Supplier's non-performance of its
obligations under this Agreement with respect to the PacifiCare Third Party
Contracts.

                                      13.
<PAGE>

8.    SERVICE LEVELS.

      8.1 INITIAL BASE SERVICE LEVELS. Commencing on the Cutover Date and
continuing throughout the Term and Termination Assistance Period, Supplier shall
perform the Services in accordance with the applicable Service Levels. The
initial Base Service Levels shall be specified in Schedule 8, or, for Base
Service Levels not specified in Schedule 8 as of the Effective Date, determined
according to the process set forth in Schedule 8 for determining Service Levels.

      8.2 SERVICE LEVELS FOR NEW SERVICES. Supplier shall provide New Services
in accordance with the New Services Service Levels as established by the Parties
in accordance with Section 5.1 and as adjusted pursuant to Section 8.3.

      8.3 ADJUSTMENT OF SERVICE LEVELS. Without limitation of the automatic
adjustment process specified in Section 1.N. of Schedule 8, the Steering
Committee (a) shall review the Service Levels for the preceding twelve (12)
months during the last calendar quarter of every Contract Year, (b) with respect
to any Service Levels that require periodic adjustment pursuant to this
Agreement or are no longer appropriate because of an increase, decrease or
change to the Services, shall, as appropriate, increase or modify the Service
Levels for the subsequent Contract Year in accordance with the Change Control
Procedures and (c) with respect to all other Service Levels, may modify or
increase the Service Levels for the subsequent Contract Year in accordance with
the Change Control Procedures. In addition, either Party may, at any time upon
notice to the other Party, initiate negotiations to review and, upon agreement
by the Steering Committee, adjust any Service Level that such Party in good
faith believes is inappropriate at the time.

      8.4 ROOT-CAUSE ANALYSIS. With respect to Supplier's failure to provide the
Services in accordance with the applicable Service Levels, Supplier shall, as
soon as reasonably practicable, but not later than five (5) days after such
failure (except as provided below in this Section 8.4), (a) perform a root-cause
analysis to identify the cause of such failure, (b) provide PacifiCare with a
report detailing the cause of, and procedure for correcting, such failure, (c)
implement such corrective procedure, including obtaining PacifiCare's consent to
such implementation where such procedure has a material effect on the PacifiCare
Entities' receipt of the Services, and (d) provide PacifiCare with a written
action plan satisfactory to PacifiCare that specifies the steps Supplier has
taken, or shall take, to prevent such failures following the implementation of
the procedure. If Supplier, using best efforts, cannot complete its obligations
under clauses (a), (b), (c) or (d) above within the five (5) day-period,
Supplier shall, on a regular basis until such obligations are completed, review
with PacifiCare Supplier's progress in completing such obligations (and provide
written summaries thereof and a schedule for completion). Supplier shall address
and resolve any concerns raised by PacifiCare in connection with such reviews.

      8.5 MEASUREMENT TOOLS. As of the Cutover Date, Supplier shall implement
the Measurement Tools and procedures required to measure and report (as
contemplated by this Section 8.5 and Section 3.8) Supplier's performance of the
Services against the applicable Service Levels. Such Measurement Tools and
procedures shall (a) permit reporting at a level of detail sufficient to verify
compliance with the Service Levels and (b) be subject to audit by

                                      14.
<PAGE>

PacifiCare or its designee pursuant to Section 19. Supplier shall provide
PacifiCare and its designees with information concerning access to such
Measurement Tools and procedures upon request for inspection and verification
purposes.

      8.6 CONTINUOUS IMPROVEMENT AND BEST PRACTICES. Supplier shall, on a
continual basis, (a) identify ways to improve the Service Levels and (b)
identify and apply, in accordance with the Change Control Procedures, proven
techniques and tools from other installations within its operations that would
benefit PacifiCare either operationally or financially. Supplier shall, from
time to time, include updates with respect to such improvements, techniques and
tools in the reports provided to PacifiCare pursuant to Section 3.8 and shall
discuss its progress in identifying and applying such improvements techniques
and tools in the knowledge sharing discussions with PacifiCare pursuant to
Section 3.6.

      8.7 SERVICE LEVEL CREDITS. In the event of Supplier's failure to provide
the Services in accordance with the applicable Critical Service Levels, Supplier
shall incur the Service Level Credits identified in and according to Schedule 8.
The Service Level Credits shall not limit PacifiCare's right to recover, in
accordance with this Agreement, other damages incurred by PacifiCare as a result
of such failure. Where (a) Service Level Credits are incurred (i) [...***...]
consecutive months for the same measured Critical Service Level or (ii)
[...***...] out of any twelve (12) months for the same measured Critical Service
Level [...***...] PacifiCare may, upon notice to Supplier, terminate this
Agreement, in whole or in part, without regard to Section 24.3(a). Nothing in
this Section shall be deemed to limit or obviate PacifiCare's right to terminate
this Agreement pursuant to Section 24.3(a). In addition to the foregoing, within
ten (10) days following the completion of root-cause analysis as required in
Section 8.4, at PacifiCare's option, following the incurrence of a Service Level
Credit, a Group Vice President of Supplier shall meet (in person or by
telephone) with the PacifiCare Supplier Relationship Manager and other members
of PacifiCare's management at a mutually agreeable time, date and location, to
summarize and present the results of the root-cause analysis required by Section
8.4 and specify the steps Supplier has taken or shall take to prevent the
further incurrence of Service Level Credits.

      8.8 EXCUSED PERFORMANCE. Supplier's requirement to perform the Services
shall be excused in accordance the principles set forth in Section I.Q. of
Schedule 8 for the following Sections of the Agreement: Section 4.1 and 4.2.

9.    PACIFICARE SATISFACTION AND BENCHMARKING.

      9.1 SATISFACTION SURVEY. Supplier shall conduct baseline and ongoing
customer satisfaction surveys.

      9.2 BENCHMARKING.

            (a) BENCHMARKER. Commencing on the Cutover Date and continuing
throughout the Term, to ensure that PacifiCare is obtaining competitive pricing,
PacifiCare reserves the right, at PacifiCare's cost and expense, to designate an
independent third party (the

                                      15.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

"BENCHMARKER") from among the list of mutually agreed upon prospective Benchmark
providers set forth in Schedule 9.2(a) to measure Supplier's performance and
pricing under this Agreement in accordance with the Benchmarking Process against
competitive providers providing services which are substantially similar in
terms of scope, volume, environment, geographic area, technologies in use
(including skill sets), and contractual terms, generally, and any other mutually
agreeable factors ([...***...]) (each a "BENCHMARK").

            (b) BENCHMARKING PROCESS. Upon PacifiCare's request, the Benchmarker
shall conduct Benchmarks, [...***...]. After receiving the results of each
Benchmark, PacifiCare shall share the results of such Benchmark with Supplier
and, within thirty (30) days of PacifiCare's sharing such results, the Parties
shall complete their review of such results (the "REVIEW PERIOD"). If any
Benchmark shows that Supplier's performance is below or Supplier's pricing is
higher than that of competitive providers, then applicable prices or service
levels (or both) under this Agreement shall be promptly adjusted such that
Supplier's performance and pricing are competitive; provided, however, that the
Parties shall, during the five (5) day period following the Review Period,
discuss the Benchmark in good faith to determine if such variances are due to
Supplier's non-competitive prices or service levels or the unique requirements
of this Agreement.

10.   SERVICE LOCATIONS.

      10.1 SERVICE LOCATIONS. The Services shall be provided to PacifiCare
Entities from (a) the PacifiCare Service Locations, (b) the Supplier Service
Locations and (c) any other location for which Supplier has received
PacifiCare's consent, to be given in PacifiCare's sole discretion, provided
however that for Base Services Supplier may, upon prior notice to PacifiCare,
elect to provide up to a maximum of forty (40) Project Staff members from an
alternate Service Location, which may be a Domestic ADC, Near-Shore ADC, or
Offshore ADC. Any incremental expenses incurred by PacifiCare as a result of a
relocation to, or use of, any location other than the locations set forth on
Schedule 10.1 shall, at PacifiCare's sole discretion, be paid by Supplier or
reimbursed to PacifiCare by Supplier, unless the provision of Services at such
other location has been requested or otherwise directed by PacifiCare or is due
to a Force Majeure Event that precludes PacifiCare from providing a PacifiCare
Service Location, in which case PacifiCare shall be solely responsible for the
costs associated with the relocation to, or use of, such other location.
Supplier and Supplier Agents may not provide or market services to a third party
from a PacifiCare Service Location without PacifiCare's consent, to be given in
PacifiCare's sole discretion.

      10.2 SAFETY AND SECURITY PROCEDURES. Supplier shall maintain and enforce
at the Service Locations safety and security procedures that are at least equal
to the most stringent of the following: (a) best practices for locations similar
to the Supplier Service Locations; (b) those procedures provided to Supplier and
applicable to the PacifiCare Service Locations, as amended by PacifiCare from
time to time during the Term; and (c) any higher standard otherwise agreed upon
by the Parties. Supplier shall comply with the safety and security procedures
that are applicable to the PacifiCare Service Locations, including the safety
and security procedures set

                                      16.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

forth in Schedule 10.2. Supplier shall, [...***...], provide the results of an
annual SAS 70 security audit to PacifiCare.

      10.3 DATA SECURITY. Supplier shall comply with the environmental,
security, and other PacifiCare data security policies and safeguards against the
destruction, loss or alteration of PacifiCare Data in the possession of Supplier
and during Supplier's electronic transmission, storage, and shipping thereof
(the "DATA SAFEGUARDS") that shall comply with and be no less rigorous than (i)
those data security policies in effect as of the Cutover Date at each applicable
PacifiCare Service Location in respect of such PacifiCare Service Location and
Supplier Service Location, and (ii) may be required by Supplier Laws and other
Laws identified to Supplier from time to time and implemented in accordance with
the Change Control Procedures. The Data Safeguards will be incorporated into the
Policies and Procedures Manual. Supplier shall revise and maintain the Data
Safeguards at PacifiCare's request. In the event Supplier intends to implement a
Change to the Data Safeguards (including pursuant to PacifiCare's request),
Supplier shall notify PacifiCare and, upon PacifiCare's consent, implement such
Change. In the event Supplier or Supplier Agents discovers or is notified of a
breach or potential breach of security relating to PacifiCare Data, Supplier
shall immediately notify the PacifiCare Supplier Relationship Manager and the
PacifiCare Director of Information Security of such breach or potential breach
and, if the applicable PacifiCare Data was in the possession of Supplier or
Supplier Agents at the time of such breach or potential breach, Supplier shall
investigate and remediate the effects of the breach or potential breach and
provide PacifiCare with a written action plan satisfactory to PacifiCare that
specifies the steps Supplier has taken, or shall take, to prevent such breaches
or potential breaches from recurring.

      10.4 SECURITY RELATING TO COMPETITORS. If (a) Supplier intends to provide
the Services from a Service Location that is shared with a third party or third
parties or (b) any part of the business of Supplier or any such third party is
now or in the future competitive with PacifiCare Entities' business, then, prior
to providing any of the Services from such a Service Location, Supplier shall
develop a process, subject to PacifiCare's prior consent, to restrict access in
any such shared environment to PacifiCare's Confidential Information so that
Supplier's employees or Supplier Agents providing services to such competitive
business do not have access to PacifiCare Confidential Information.

11.   HUMAN RESOURCES.

      Supplier shall offer employment to the Affected Employees set forth in
Schedule 3.1(b)(ii) , and the transitioning to Supplier of such Affected
Employees who accept such offers (the "TRANSITIONED PERSONNEL") shall be
effected in accordance with the terms and conditions set forth in Schedule 11.

12.   SUPPLIER STAFF.

      12.1 SUPPLIER CLIENT RELATIONSHIP MANAGER. Supplier shall appoint an
individual (the "SUPPLIER CLIENT RELATIONSHIP MANAGER") who from the Effective
Date shall serve, on a full-time basis, as the primary Supplier representative
under this Agreement. Supplier's appointment of any Supplier Client Relationship
Manager shall be subject to PacifiCare's prior consent. The

                                      17.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

Supplier Client Relationship Manager shall (a) have overall responsibility for
managing and coordinating the performance of Supplier's obligations under this
Agreement and (b) be authorized to act for and on behalf of Supplier with
respect to all matters relating to this Agreement.

      12.2 KEY PERSONNEL. With respect to the Key Personnel set forth in
Schedule 12.2, except as otherwise agreed by PacifiCare, the Parties agree as
follows:

            (a) All Key Personnel shall be dedicated to the PacifiCare account
on a full-time basis.

            (b) Before assigning an individual to a Key Personnel position,
whether as an initial assignment or as replacement, Supplier shall (i) notify
PacifiCare of the proposed assignment, (ii) introduce the individual to
appropriate representatives of PacifiCare Entities, (iii) subject to applicable
Law, provide PacifiCare with any information regarding the individual that may
be reasonably requested by PacifiCare and (iv) obtain PacifiCare's consent for
such assignment. Upon Supplier's request, PacifiCare shall discuss with
Supplier, in reasonable detail, its basis for its refusal to grant such consent
and the Parties shall in good faith seek to resolve the matter in a mutually
agreeable manner, provided that in any event, Supplier shall only assign an
individual to a Key Personnel position who is approved by PacifiCare.

            (c) Supplier shall not replace or reassign (i) the Supplier Client
Relationship Manager for [...***...] from the date on which such individual is
designated as the Supplier Client Relationship Manager, or (ii) any other Key
Personnel assigned as of the Effective Date for [...***...] from the Effective
Date (provided that if any Key Personnel has duties in connection with a
particular discrete project that has not been completed as of the date that is
[...***...], such Key Personnel may not be replaced or reassigned until the
completion of such project), unless PacifiCare consents in its sole discretion
to such reassignment or replacement, or such Key Personnel (1) voluntarily
resigns from Supplier, (2) is dismissed by Supplier for misconduct, (3) fails to
perform his or her duties and responsibilities pursuant to this Agreement or (4)
dies or is otherwise unable to work due to his or her disability or legally
protected leave taken pursuant to Law.

            (d) If PacifiCare in good faith decides that any Key Personnel
should not continue in that position, then PacifiCare may, in its sole
discretion and upon notice to Supplier, require immediate removal of such Key
Personnel from the Project Staff; provided that, upon Supplier's request,
PacifiCare shall, prior to requiring such removal, discuss with Supplier, in
reasonable detail, its basis for requesting such removal. Supplier shall, as
soon as reasonably practicable following PacifiCare's required removal of any
Key Personnel from the Project Staff, replace such Key Personnel in accordance
with this Section 12.2.

            (e) Supplier shall maintain backup procedures and conduct the
replacement procedures for any Key Personnel in such a manner so as to assure an
orderly succession for any Key Personnel who is replaced.

                                      18.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

      12.3 PROJECT STAFF. Supplier shall appoint to the Project Staff
individuals with suitable training and skills to perform the Services. Supplier
shall provide PacifiCare with a list of all Supplier personnel dedicated
full-time to the Project Staff at the end of every ninety (90)-day period after
the Cutover Date. Except as otherwise approved by PacifiCare (in its sole
discretion), those Supplier personnel located on PacifiCare's premises may only
provide services on such premises that support PacifiCare's operations. Supplier
shall notify PacifiCare as soon as possible after dismissing or reassigning any
member of the Project Staff whose normal work location is at a PacifiCare
Service Location.

      12.4 SUBCONTRACTORS.

            (a) With the exception of those subcontractors who meet the criteria
for approval set forth in Sections 12.4(e) and 12.4(f), prior to subcontracting
the Services or any portion thereof, Supplier shall: (i) notify PacifiCare of
the proposed subcontract; (ii) provide the name of the proposed subcontractor, a
description of the work to be subcontracted, an explanation of why that work is
to be subcontracted and descriptive information about each subcontractor's
ability to perform the work; (iii) obtain PacifiCare's consent of such
subcontract. PacifiCare Entities shall not be bound by the provisions of any
agreements entered into between Supplier and its subcontractors. Prior to
amending, modifying or otherwise supplementing any subcontract relating to the
Services, the effect of which would materially increase the scope or nature of
the services provided by such subcontractor, Supplier shall notify PacifiCare of
the proposed amendment, modification or supplement and shall obtain PacifiCare's
consent thereof.

            (b) No subcontracting shall release Supplier from its responsibility
for its obligations under this Agreement. Supplier shall be responsible for the
work and activities of its subcontractors, including compliance with the terms
of this Agreement.

            (c) Any third party chosen by Supplier to develop products or
deliver services shall be required to adhere to PacifiCare's standards, policies
and procedures in effect at the time.

            (d) Supplier shall be responsible for all payments to its
subcontractors. Supplier shall promptly pay for all services, materials,
equipment and labor used in providing the Services and Supplier shall keep
PacifiCare Entities' premises free of all liens.

            (e) Those subcontractors who, as of the Effective Date, have been
pre-approved by PacifiCare are set forth in Schedule 12.4(e) attached hereto.

            (f) For non-critical services for which Supplier wishes to engage
subcontractors under a contract having an annual value of Two Hundred Fifty
Thousand Dollars ($250,000) or less, Supplier may comply with this Section 12.4
by providing PacifiCare with notice as soon as practicable after engaging such
subcontractor, provided that all other provisions of this Section 12.4 shall
apply and PacifiCare's consent shall be deemed given subject to revocation for
good cause.

                                      19.
<PAGE>

            (g) If PacifiCare in good faith objects to the continued use of a
subcontractor or the scope of the duties of a particular subcontractor, even if
such subcontractor has been previously approved pursuant to Section 12.4(a),
then, upon notice from PacifiCare of such objection (including reasonable
details concerning the basis of such objection), PacifiCare and Supplier shall
in good faith attempt to resolve such objections as soon as possible. If the
Parties have not resolved such objections within five (5) business days of
Supplier's receipt of PacifiCare's notice thereof, then Supplier shall cause
such subcontractor to cease providing services in connection with this Agreement
and shall as soon as reasonably practicable replace such subcontractor with a
replacement acceptable to PacifiCare.

      12.5 CONDUCT OF SUPPLIER PERSONNEL. While at the PacifiCare Service
Locations, Supplier and Supplier Agents agree at all times to, and shall cause
the Project Staff to (a) comply with the requests, standard rules and
regulations of PacifiCare regarding safety and health, personal and professional
conduct (including adhering to general safety practices or procedures) generally
applicable to such PacifiCare Service Locations, (b) otherwise conduct
themselves in a businesslike manner and (c) maintain and enforce Section 20 of
this Agreement. If PacifiCare notifies Supplier that a particular member of the
Project Staff is not conducting himself or herself in accordance with this
Section, Supplier shall promptly: (y) investigate the matter and take
appropriate action that may include (i) removing the applicable person from the
Project Staff, (ii) providing PacifiCare with prompt notice of such removal and
(iii) replacing the applicable person with a similarly qualified individual; or
(z) take other appropriate disciplinary action to prevent a recurrence. In the
event of multiple violations of this Section by a particular member of the
Project Staff, Supplier shall promptly remove the individual from the Project
Staff.

      12.6 NON-COMPETITION. Supplier shall not assign any Key Personnel to the
account of any PacifiCare Competitor without PacifiCare's prior consent for
[...***...] following the last date on which such Key Personnel ceases to
provide Services to PacifiCare pursuant to this Agreement.

      12.7 NON-SOLICITATION. It is the intention of the Parties not to solicit
each other's employees, and as such each Party agrees that if it offers
employment to, employs, engages as an independent contractor, or otherwise
obtains the services of any person who is employed or was employed within
[...***...] by the other Party, and who performed duties for the other Party
pursuant to this Agreement during the Term, ("RESTRICTED EMPLOYEE"), such Party
must pay the other Party damages in an amount equal [...***...]. Notwithstanding
anything in this Section to the contrary, either Party may directly or
indirectly solicit and hire any employee of the other Party at any time after
such employee is terminated by the other Party without penalty of any kind.

13.   MANAGEMENT AND CONTROL.

      13.1 STEERING COMMITTEE. Prior to the Cutover Date, the PacifiCare
Supplier Relationship Manager and the Supplier Client Relationship Manager shall
determine the composition of a steering committee and each shall appoint an
equal number of representatives to serve on such committee (the "STEERING
COMMITTEE"). PacifiCare shall designate one of its representatives on the
Steering Committee to act as the chairperson of the Steering Committee.

                                      20.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

The Steering Committee shall be authorized and responsible for (a) advising with
respect to PacifiCare's tactical decisions regarding the establishment,
budgeting and implementation of PacifiCare's priorities and plans for the
Services; (b) reviewing, on a quarterly basis, and revising, as directed by the
Steering Committee, Schedules 12.6(a) and 12.6(b); and (c) monitoring and,
without limitation of the dispute resolution procedures set forth in Section 23
(Dispute Resolution), resolving disagreements regarding the provision of the
Services and the Service Levels. A Party may change any of its representatives
on the Steering Committee upon notice to the other Party; provided that such
change may be effected without causing any delays in completing the dispute
resolution procedures set forth in Section 23.

      13.2 OVERSIGHT AND MANAGEMENT PROCESS; RELATIONSHIP WITH INFRASTRUCTURE
SUPPLIER. Supplier shall perform the Services in accordance with this Section
13.2.

            (a) RELATIONSHIP WITH INFRASTRUCTURE SUPPLIER; OPERATIONAL
AGREEMENT. Supplier and the Infrastructure Provider shall cooperate and interact
with each other to the extent necessary for the PacifiCare Entities to receive
the Services and the Infrastructure Services in accordance with the terms and
conditions of this Agreement and the Infrastructure Agreement, respectively.
PacifiCare shall, as PacifiCare deems appropriate, control and be the primary
interface for the PacifiCare Entities with Supplier, the Infrastructure Provider
and third parties. Supplier and the Infrastructure Provider shall take all steps
necessary to deliver the Services and the Infrastructure Services in a
consolidated manner and as an integrated service delivery team in accordance
with the Operational Agreement, including, for example, through the utilization
of integrated tools, processes and methodologies, where applicable. In
furtherance of the foregoing, prior to the Cutover Date, Supplier and
Infrastructure Supplier shall execute an agreement acceptable in form and
substance to PacifiCare (the "OPERATIONAL AGREEMENT"), which shall include,
among other things, provisions that set forth the following terms:

                  (i) Supplier and the Infrastructure Provider shall establish
an integrated Program Office (the "PROGRAM OFFICE") and procedures (e.g., the
customer satisfaction methodology described on Schedule 13.2) acceptable to
PacifiCare for use by the Infrastructure Provider and Supplier to (1) prevent
problems with, or any interruptions (other than in connection with scheduled
downtime contemplated by the Policy and Procedures Manual) or degradation to,
the Services and the other services, (2) promptly resolve any such problems,
interruptions or degradation that occur and (3) determine the accountability as
between themselves for such problems, interruptions or degradation. The initial
Program Office shall consist of the individuals and positions in accordance with
Schedule 13.2. Members of the Program Office shall be deemed to be Key Personnel
for purposes of this Agreement.

                  (ii) With respect to (1) Supplier's failure to provide the
Services in accordance with the applicable Service Levels or (2) the
Infrastructure Provider's failure to provide the Infrastructure Services in
accordance with applicable service levels, the Supplier shall perform, in
accordance with Section 8.4 of this Agreement and shall cooperate with
Infrastructure Supplier to perform in accordance with Section 8.4 of the
Infrastructure Agreement, an integrated root cause analysis to implement
correction procedures and provide PacifiCare with the reports and action plans
as required by Section 8.4 of this Agreement. The Infrastructure Provider shall
implement measurement and monitoring tools and procedures that

                                      21.
<PAGE>

permit integrated reporting of compliance with applicable service levels, and
the incurrence of service level credits, with respect to the Services and the
Infrastructure Services. In the event that such service level failures result in
the incurrence of a service level credit (as provided in Section 8.8 of this
Agreement or in Section 8.8 of the Infrastructure Agreement, as applicable),
service level credits shall be apportioned among, or incurred by each of,
Supplier and the Infrastructure Provider, in accordance with the Operational
Agreement.

                  (iii) Supplier and the Infrastructure Provider shall establish
efficient means of communication, including through a governance structure
incorporating executive and operational committees described on Schedule 13.2,
for use by Supplier, the Infrastructure Provider and PacifiCare, such that both
routine operational information and information relating to any issue or
problems with, or any interruptions (other than in connection with scheduled
downtime contemplated by the Policy and Procedures Manual) or degradation to,
the Services and any other services flow between Supplier, the Infrastructure
Provider and PacifiCare without material delay and without requiring
coordination by, or intervention of, PacifiCare, except as PacifiCare otherwise
requires.

                  (iv) Supplier and the Infrastructure Provider, working with
PacifiCare to the extent PacifiCare deems appropriate, shall in good faith
attempt to resolve all disputes between Supplier and the Infrastructure Provider
relating to the provision of the Services and the Infrastructure Services or any
other services, as soon as possible and without involving PacifiCare; provided
that in the event that Supplier and the Infrastructure Provider do not resolve
such disputes themselves, Supplier and the Infrastructure Provider may, jointly,
request that PacifiCare, at no cost or expense to PacifiCare, resolve such
dispute and, if so requested, such resolution shall be final and binding on
Supplier and the Infrastructure Provider. Supplier and Infrastructure Supplier
shall indemnify PacifiCare from, and defend and hold PacifiCare harmless from
and against, any Losses suffered, incurred or sustained by PacifiCare in
connection with the resolution of any such dispute by PacifiCare, in accordance
with the terms and conditions of the Operational Agreement.

                  (v) Supplier and the Infrastructure Provider shall provide for
the integration of tools, processes and methodologies where applicable in
accordance with the Operational Agreement.

                  (vi) [...***...]

                  (vii) PacifiCare, Supplier and the Infrastructure Provider
shall provide for any other provisions necessary for Supplier and Infrastructure
Supplier to provide PacifiCare with the Services (including the Termination
Assistance Services) and the Infrastructure Services in an integrated manner.

Supplier shall not modify or amend the Operational Agreement in a manner that
would materially affect PacifiCare, the provision of the Services, the provision
of the Infrastructure

                                      22.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

Services or PacifiCare's ability to enforce its rights and remedies under this
Agreement, without PacifiCare's prior consent.

            (b) [...***...]

      13.3 POLICY & PROCEDURES MANUAL. An initial outline of an application
systems maintenance and enhancements management Policy & Procedures Manual for
the Services is set forth on Schedule 13.3 which specifies those activities
which Supplier has primary responsibility to deliver to PacifiCare as well as
those activities where Supplier will cooperate with Infrastructure Supplier in
its performance of certain Infrastructure Services. Within [...***...]
after the Cutover Date, Supplier shall deliver to PacifiCare, for PacifiCare's
review, comment and consent, an application systems maintenance and enhancements
management Policy & Procedures Manual based on the outline set forth in Schedule
13.3 for those activities designated as Supplier's primary responsibility (the
"POLICY & PROCEDURES MANUAL"). Supplier shall periodically prepare and provide
to PacifiCare, for PacifiCare's review, comment and consent, updates to such
Policy & Procedures Manual to reflect any changes in the procedures described
therein as soon as practicable after such changes are made at PacifiCare's
request or with PacifiCare's consent.

      13.4 CHANGE CONTROL PROCEDURES. Supplier and Infrastructure Provider shall
establish the integrated Change Control Procedures. Within thirty (30) days of
receipt of Infrastructure Supplier's Change Control Procedures, Supplier shall
deliver to PacifiCare, for its review, comment and consent, the Change Control
Procedures. The Change Control Procedures shall provide, at a minimum, that:

            (a) no Change shall be implemented without PacifiCare's consent
(which may be given in an e-mail or other electronic format), except as may be
necessary on a temporary basis to maintain the continuity of the Services, and
any projected adverse effect of any Change

                                      23.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

with respect to the Services, Service Levels or Fees shall be a reasonable basis
for disapproval of such proposed Change;

            (b) with respect to all Changes, Supplier shall (i) schedule
Changes, other than those Changes made on a temporary basis, to maintain the
continuity of the Services so as not to unreasonably interrupt PacifiCare
Entities' business operations, (ii) prepare and deliver to PacifiCare each month
a rolling schedule for ongoing and planned Changes for the next twelve (12)
month period and (iii) monitor the status of Changes against the applicable
schedule; and

            (c) with respect to any Change made on a temporary basis to maintain
the continuity of the Services, Supplier shall document and provide to
PacifiCare notification of the Change no later than the next business day after
the Change is made.

            Supplier shall update the Change Control Procedures as necessary and
shall provide such updated Change Control Procedures to PacifiCare for its
consent.

14.   PROPRIETARY RIGHTS.

      14.1 BACKGROUND TECHNOLOGY. Supplier shall have and retain exclusive
ownership of all of Supplier's Background Technology and intellectual property
rights therein. Prior to including any Supplier Background Technology in any
Developed Software or Work Product that Supplier shall use or deliver to any
PacifiCare Entities in connection with the Services, Supplier must set forth in
writing such Background Technology to be included and obtain PacifiCare's
consent. PacifiCare Entities shall have and retain exclusive ownership of all of
PacifiCare Entities' Background Technology and intellectual property rights
therein. All rights not expressly granted herein with respect to Background
Technology are reserved to the owner thereof.

      14.2 PACIFICARE SOFTWARE. PacifiCare shall provide Supplier with access to
and Use of the PacifiCare Software required to render the Services, current
lists of which are attached hereto as Schedules 14.2(a) and 14.2(b). Subject to
the terms and conditions of this Agreement, PacifiCare hereby grants to
Supplier, during the Term and the Termination Assistance Period and solely to
provide the Services to PacifiCare Entities, a non-exclusive, non-transferable,
royalty-free limited license to have access to and (a) Use the PacifiCare
Proprietary Software (and Related Documentation in PacifiCare's possession), and
(b) Use, to the extent permissible under the applicable third party agreements,
the PacifiCare Third Party Software (and Related Documentation in PacifiCare's
possession). Supplier may sublicense, to the extent permissible under any
applicable third party agreements, to Supplier Agents the right to have access
to and Use the PacifiCare Software solely to provide those Services that such
Supplier Agents are responsible for providing. All rights not expressly granted
to Supplier in this Agreement with respect to the PacifiCare Software are
reserved to PacifiCare.

      14.3 SUPPLIER SOFTWARE. Supplier shall provide PacifiCare Entities with
access to and Use of the Supplier Software. Supplier shall obtain PacifiCare's
consent prior to using any Supplier Software (and any of Supplier's Background
Technology included in the Supplier Software) to provide the Services. A current
list of Supplier Software is attached hereto as

                                      24.
<PAGE>

Schedule 14.3. Subject to the terms and conditions of this Agreement, Supplier
hereby grants to PacifiCare, for itself and on behalf of the PacifiCare
Entities, during the Term and for a period of eighteen (18) months after
termination or expiration of this Agreement, a global, fully paid-up, royalty
free, non-exclusive, non-transferable, and continuing license to Use, and
sublicense and to permit third parties to Use, solely to the extent required to
utilize the Services, (a) the Supplier Proprietary Software (and any of
Supplier's Background Technology included in the Supplier Software) and (b) to
the extent permissible under the applicable third party agreements, the Supplier
Third Party Software being used to provide the Services as of the date of
expiration or termination of this Agreement. Upon PacifiCare's request, Supplier
shall provide PacifiCare with a list of all Supplier Software being used to
provide the Services as of the date of such request. All rights not expressly
granted to PacifiCare Entities in this Agreement with respect to the Supplier
Software are reserved to Supplier.

      14.4 SUPPLIER TOOLS. Supplier shall obtain PacifiCare's consent prior to
using any Tools (and any of Supplier's Background Technology included in the
Tools) to provide the Services. Subject to the terms and conditions of this
Agreement, Supplier hereby grants to PacifiCare, for itself and on behalf of the
PacifiCare Entities, during the Term and for a period of eighteen (18) months
after termination or expiration of this Agreement, a global, fully paid-up,
royalty free, non-exclusive, non-transferable, and continuing license to Use,
and sublicense and to permit a third party to Use, solely to the extent required
to utilize the Services , Supplier's proprietary Tools (and any of Supplier's
Background Technology included in Supplier's proprietary Tools) to provide the
Services. Furthermore, to the extent permissible under the applicable third
party agreements, Supplier hereby grants to PacifiCare Entities, during the Term
and for a period of eighteen (18) months after the termination or expiration of
this Agreement, a global, fully paid-up, royalty free, non-exclusive,
non-transferable, and continuing license to Use, and sublicense and to permit a
third party to Use, solely to the extent required to utilize the Services, any
third-party Tools used by Supplier in furtherance of its duties pursuant to this
Agreement. All rights not expressly granted to PacifiCare Entities in this
Agreement with respect to the Tools are reserved to Supplier and its suppliers.

      14.5 DEVELOPED SOFTWARE. Subject to Section 14.1, all Developed Software
and Work Product shall be owned by PacifiCare. PacifiCare shall have all right,
title and interest, including worldwide ownership of copyright, patent, trade
secret or other proprietary rights in and to the Developed Software and Work
Product and all copies made from it. Subject to Section 14.1, Supplier hereby
irrevocably assigns, transfers and conveys, and shall cause Supplier Agents to
assign, transfer and convey, to PacifiCare without further consideration all of
its right, title and interest in and to such Developed Software and Work
Product, including all worldwide rights of patent, copyright, trade secret or
other proprietary rights in such materials. Supplier acknowledges that
PacifiCare and the successors and permitted assigns of PacifiCare shall have the
right to obtain and hold in their own names any intellectual property rights in
and to the Developed Software and Work Product. Supplier agrees to obtain any
consents, authorizations, permits or assignments and to execute any documents or
take any other actions (including requiring any Supplier Agents to execute any
documents or take other actions) as may reasonably be necessary, or as
PacifiCare may reasonably request, to perfect PacifiCare's ownership of any such
Developed Software and Work Product.

                                      25.
<PAGE>

      14.6 WEB DEVELOPMENT. In the event that Supplier performs any work in
connection with the development of Web pages or other online content under this
Agreement, PacifiCare shall have sole control over the Web pages and the
appearance, design, layout, look-and-feel, branding, advertising (if any),
content and URLs of such Web pages or other online content (collectively, "WEB
CONTENT"). All Web Content that is developed by Supplier and/or Supplier Agents
shall be Work Product. Supplier shall ensure that all URLs for any Web pages or
online content developed or hosted by Supplier shall be owned by PacifiCare and
registered in PacifiCare's name.

      14.7 UPGRADES TO SOFTWARE. Supplier shall upgrade Software in accordance
with EXHIBIT B.

15.   DATA.

      15.1 OWNERSHIP OF PACIFICARE DATA. All PacifiCare Data is, or shall be,
and shall remain the property of PacifiCare. Supplier hereby irrevocably
assigns, transfers and conveys, and shall cause Supplier Agents to assign,
transfer and convey, to PacifiCare without further consideration all of its and
their right, title and interest in and to PacifiCare Data.

      15.2 USE OF PACIFICARE DATA. Without PacifiCare's consent (subject to
PacifiCare's sole discretion), PacifiCare Data shall not be (a) used, disclosed,
monitored, analyzed, individualized, anonymized, aggregated, stored, copied, or
otherwise provided to third parties by Supplier or Supplier Agents other than as
required to provide the Services, (b) sold, assigned or leased, or (c)
commercially exploited in any form (including any individualized, anonymized or
aggregated form) by or on behalf of Supplier or Supplier Agents. Supplier shall
at all times comply with all PacifiCare data retention, use and privacy
standards and all Laws relating to Supplier's access to PacifiCare Data.

      15.3 CORRECTION AND RECONSTRUCTION.

            (a) Supplier shall, [...***...], promptly correct any errors or
inaccuracies in the reports delivered to PacifiCare under this Agreement that
are attributable to Supplier or Supplier Agents.

            (b) Supplier shall develop and maintain procedures for the
reconstruction of lost PacifiCare Data, and Supplier shall, [...***...], correct
any errors in, or destruction, loss or alteration of, any PacifiCare Data that
are attributable to Supplier or Supplier Agents. At PacifiCare's request and
expense, Supplier shall promptly correct any errors in, or destruction, loss or
alteration of, PacifiCare Data that are not attributable to Supplier or Supplier
Agents.

      15.4 RETURN OF DATA. Upon request by PacifiCare at any time during the
Term and upon expiration or termination of this Agreement, or at any time when
Supplier no longer requires any portion of the PacifiCare Data to provide the
Services, Supplier shall (a) promptly return to PacifiCare, in the format and on
the media requested by PacifiCare, all PacifiCare Data (or such portion as
requested by PacifiCare or that is no longer necessary to provide the Services)

                                      26.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

and (b) erase or destroy all PacifiCare Data (or such portion of PacifiCare Data
as requested by PacifiCare or that is no longer necessary to provide the
Services) in Supplier's possession. Supplier and Supplier Agents shall use any
archival tapes containing PacifiCare Data solely for back-up purposes and shall
maintain such back-up copies of PacifiCare Data as Confidential Information of
PacifiCare. [...***...]

16.   CONTINUED PROVISION OF SERVICES.

      16.1 DISASTER RECOVERY PLAN. PacifiCare will provide to Supplier a copy of
its then-current disaster recovery plans (collectively, the "DRP"), which DRP
shall be effective under this Agreement until PacifiCare approves of any
successor DRP to be developed pursuant to the Infrastructure Agreement. Promptly
following the Cutover Date, Supplier shall cooperate with Infrastructure
Supplier, to the extent that Infrastructure Supplier performs and provides the
necessary infrastructure support services to PacifiCare and Supplier, to: (a)
evaluate PacifiCare's current DRP and submit recommended DRP improvements
related to the Services for PacifiCare's review and approval and, if PacifiCare
approves of the DRP improvements, implement a revised DRP acceptable to
PacifiCare in accordance with the Change Control Procedures and within
[...***...], or such other date as may be agreed upon by PacifiCare, Supplier,
and Infrastructure Provider; (b) update and test the operability of the DRP as
it relates to the Services [...***...] during the Term; and (c) certify in
writing to PacifiCare [...***...] during the Term that the DRP is fully
operational as it relates to the Services. Subject to the foregoing sentence, if
the DRP testing encounters errors, Supplier shall develop procedures and retest
as necessary to resolve such errors and update the DRP as necessary. Supplier
shall immediately implement the DRP upon the occurrence of a disaster (as such
term is defined in the DRP) as it relates to the Services and subject to the
provisions contained herein. In the event of an interruption in services
described as "critical" in Schedule 16.1 ("CRITICAL SERVICES"), Supplier shall
use its best efforts to reinstate the Critical Services as promptly as possible,
but in any event within the number of hours identified in Schedule 16.1 with
respect to each of the Critical Services, provided that Supplier's failure to
reinstate the Critical Services shall be excused to the extent that
Infrastructure Supplier's failure to perform or provide the necessary
infrastructure support services to PacifiCare and Supplier prevents Supplier
from doing so. In the event of a disaster (as such term is defined in the DRP),
Supplier shall not increase its Fees under this Agreement or charge PacifiCare
usage fees in addition to the Base Fees or the Variable Fees.

      16.2 FORCE MAJEURE. If and to the extent that a Party's performance of any
of its obligations pursuant to this Agreement is prevented, hindered or delayed
by fire, flood, earthquake, elements of nature or acts of God, acts of war,
terrorism, riots, civil disorders, rebellions or revolutions, or any other
similar cause beyond the reasonable control of such Party (but specifically
excluding [...***...]) (each, a "FORCE MAJEURE EVENT"), and such
non-performance, hindrance or delay could not have been prevented by reasonable
precautions, then the non-performing, hindered or delayed Party shall be excused
for such non-performance, hindrance or delay, as applicable, of those
obligations affected by the

                                      27.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

Force Majeure Event for as long as such Force Majeure Event continues and such
Party continues to use its best efforts to recommence performance whenever and
to whatever extent possible without delay, including through the use of
alternate sources, workaround plans or other means. The Party whose performance
is prevented, hindered or delayed by a Force Majeure Event shall immediately
notify the other Party of the occurrence of the Force Majeure Event and describe
in reasonable detail the nature of the Force Majeure Event. The occurrence of a
Force Majeure Event does not excuse, limit or otherwise affect Supplier's
obligation to provide either normal recovery procedures or any other disaster
recovery services described in Section 16.1.

      16.3 ALTERNATE SOURCE. If any Force Majeure Event prevents, hinders or
delays Supplier's performance of any Services, other than a Force Majeure Event
that precludes PacifiCare from providing a PacifiCare Service Location, for the
time identified on Schedule 16.1 in the case of any Critical Service or more
than [...***...] in the case of all other Services, Supplier shall, [...***...],
procure such Services from an alternate source. PacifiCare shall continue to pay
Supplier the Fees established hereunder for Services provided during such
period.

      If any Force Majeure Event precludes PacifiCare from providing a
PacifiCare Service Location, PacifiCare shall provide to Supplier substantially
similar substitute facilities in reasonably practicable geographic proximity and
as soon as reasonably possible in order to render the Services, and will pay
Supplier's costs to relocate to such substitute facilities. Supplier shall
provide reasonable assistance and support to PacifiCare during this period and
will mitigate any costs associated therewith to the extent reasonably
practicable. PacifiCare shall continue to pay Supplier the Fees in accordance
with the terms of this Agreement during such period. If the Force Majeure Event
continues to prevent, hinder, or delay performance of the Services for more than
[...***...] in the case of Critical Services, or more than [...***...] in the
case of all other Services, PacifiCare may terminate this Agreement in whole or
in part, as of the date specified by PacifiCare in a termination notice to
Supplier without regard to Section 24.4.

      16.4 NO PAYMENT FOR UNPERFORMED SERVICES. Subject to Section 16.3 above,
if Supplier fails to provide the Services in accordance with this Agreement due
to the occurrence of a Force Majeure Event, the Fees shall be adjusted in a
manner such that PacifiCare is not responsible for the payment of any Fees for
Services that Supplier fails to provide.

      16.5 ALLOCATION OF RESOURCES. Whenever a Force Majeure Event or a disaster
causes Supplier to allocate limited resources between or among Supplier's
customers, Supplier shall not provide to any other customers of Supplier
priority over PacifiCare. In addition, in no event shall Supplier redeploy or
reassign any Key Personnel to another account in the event of a Force Majeure
Event without the prior consent of PacifiCare.

17.   PAYMENTS AND INVOICING.

      17.1 BASE FEES. In consideration of Supplier providing the Base Services,
and in accordance with Section 17.2, PacifiCare shall pay to Supplier the Base
Fees. Except as expressly set forth in this Agreement, there shall be no charge
or fees payable by PacifiCare in respect of Supplier's performance of its
obligations pursuant to this Agreement.

                                      28.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

      17.2 BASE FEES. Within ten (10) days after the first day of each month of
the Term, Supplier shall invoice PacifiCare for the Base Services to be
performed in accordance with this Agreement during that month. The Base Fees for
each month during the Term shall be due and payable to Supplier by the last day
of the month in which Supplier provided the Services. Undisputed Base Fees not
paid when due shall accrue Interest as set forth in Schedule 17.

      17.3 VARIABLE FEES AND ADJUSTMENT OF BASELINES. At the end of every month,
Supplier shall review the amount of the Base Services used by PacifiCare during
the preceding month. In the event PacifiCare's use of such services (a)
increases above the resource baselines set forth in Schedule 17, PacifiCare
shall pay to Supplier, in addition to the Base Fees, an amount equal to the
Additional Resource Charges in connection with the services set forth in
Schedule 17 or (b) subject to Section 17.8, decreases below the resource
baselines set forth in Schedule 17, Supplier shall credit PacifiCare an amount
equal to Reduced Resource Credits in connection with the services set forth in
Schedule 17. All such payments and credits shall be made in accordance with
Section 17.5. Subject to Section 17.8, upon ninety (90) days advance notice to
Supplier, and no more than once each Contract Year, PacifiCare may adjust the
resource baselines set forth in Schedule 17 and PacifiCare and Supplier shall
implement an appropriate adjustment to the Fees to reflect the adjustment of the
resource baselines in accordance with Schedule 17.

      17.4 VARIABLE FEE REPORT. Within ten (10) days after the last day of each
month of the Term, beginning after the first month after the Cutover Date,
Supplier shall provide PacifiCare with the Variable Fee Report and an invoice
for payment of the Additional Resource Charges. PacifiCare shall pay such
invoice within thirty (30) days after PacifiCare's receipt of such invoice or,
in the event the Reduced Resource Credits are in excess of the Additional
Resource Charges, Supplier shall provide PacifiCare with a credit as set forth
in the invoice for the Base Fees for the following month. In the event
PacifiCare disapproves of any of the Variable Fees set forth in the Variable Fee
Report, PacifiCare shall provide Supplier with a list of any Variable Fees of
which PacifiCare disapproves (and, with reasonable detail, the basis for such
disapproval) and Supplier shall adjust the Variable Fee Report to reflect the
changes indicated by PacifiCare and agreed to by Supplier.

      17.5 TIME OF PAYMENT. Except as otherwise provided in this Section 17, any
undisputed sum due Supplier pursuant to this Agreement, including reasonable
pass-through expenses, for which payment is not otherwise specified shall be due
and payable [...***...] after receipt by PacifiCare of an invoice from Supplier.
If any payments or portion thereof are not received by Supplier within
[...***...] business days after the date by payment is due, PacifiCare shall pay
Supplier Interest on such overdue amount in accordance with Schedule 17.

      17.6 DETAILED INVOICES. Supplier shall provide invoices with varying
degrees of detail (e.g., per End-User, PacifiCare Entity, department, project or
site), in accordance with the requirements set forth in Schedule 17, or as
requested by PacifiCare.

      17.7 FEE DISPUTE. PacifiCare may withhold invoiced amounts that PacifiCare
disputes in good faith. PacifiCare shall notify Supplier of all such disputes
within thirty (30) days of receipt of Supplier's invoice therefor, and any such
notice shall be in writing and shall provide in

                                      29.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

reasonable detail an explanation of each such dispute. PacifiCare shall pay the
amount of any invoice not in dispute in accordance with the terms of this
Agreement.

      17.8 SUBSTANTIAL CHANGES. Notwithstanding anything in this Agreement or
its Schedules to the contrary, in the event that PacifiCare's use of the Base
Services decreases to less than [...***...] of the resource baselines set forth
in Attachment 2 of Schedule 17, PacifiCare and Supplier shall negotiate and
implement an appropriate adjustment to the Fees.

      17.9 ADJUSTMENTS TO FEES. There shall be no periodic adjustments to the
Fees except as set forth in Schedule 17.

      17.10 EXPENSES. Except as expressly set forth in this Agreement or the
Schedules, all costs and expenses relating to the Services are included in the
Fees and shall not be charged to or reimbursed by PacifiCare.

      17.11 RIGHTS OF SET-OFF. With respect to any amount that (a) should be
reimbursed to PacifiCare or (b) is otherwise payable to PacifiCare pursuant to
this Agreement, PacifiCare may deduct the entire amount owed to PacifiCare
against the Fees or against the expenses owed by PacifiCare to Supplier under
this Agreement.

      17.12 PRORATION. All periodic Fees under this Agreement are to be computed
on a calendar month basis and shall be prorated on a per diem basis for any
partial month.

      17.13 UNUSED CREDITS. Any unused credits against future payments owed to
either Party by the other pursuant to this Agreement shall be paid to the
applicable Party within thirty (30) days after the earlier of the expiration or
termination of this Agreement.

      17.14 [...***...]

                                      30.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

[...***...]

18.   TAXES.

      18.1 Subject to Section 18.2, each Party shall be responsible for any
personal property taxes on property it owns or leases, for franchise and
privilege taxes on its business, and for taxes based on its net income or gross
receipts.

      18.2 The Fees paid to Supplier are inclusive of, and Supplier shall be
responsible for, any applicable sales, use, gross receipts, excise, value-added,
services, consumption, withholding or other taxes attributable to periods on or
after the Cutover Date based upon or measured by Supplier's cost in acquiring or
providing equipment, materials, supplies or services furnished or used by
Supplier in performing or furnishing the Services.

      18.3 [...***...]

      18.4 Any taxes assessed, as determined by PacifiCare, including a gross-up
thereon, on the provision of the Services for a particular site resulting from
Supplier's relocating or rerouting the delivery of Services for Supplier's
convenience to, from or through a location other than the Service Location used
to provide the Services as of the Cutover Date shall be Supplier's
responsibility; provided that, PacifiCare may pay such taxes and PacifiCare
shall receive a credit with respect to the Fees invoiced under this Agreement
equal to such payments made pursuant to this Section 18.4.

      18.5 Where applicable, PacifiCare and Supplier shall cooperate to
segregate the Fees into the following separate payment streams: (a) those for
taxable Services; (b) those for non-taxable Services; (c) those for which a
sales, use or other similar tax has already been paid; and (d) those for which
Supplier functions merely as a paying agent for PacifiCare in receiving goods,
supplies or services (including leasing and licensing arrangements) that
otherwise are nontaxable or have previously been subject to tax. In addition,
each of PacifiCare and Supplier shall reasonably cooperate with the other to
more accurately determine a Party's tax liability and to minimize such
liability, to the extent legally permissible. Each of PacifiCare and Supplier
shall provide and make available to the other any resale certificates,
information regarding out-of-state sales or use of equipment, materials or
services, and any other exemption certificates or information requested by a
Party.

                                      31.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

19.   AUDITS.

      19.1 SERVICES. Upon notice from PacifiCare, Supplier and Supplier Agents
shall provide PacifiCare, PacifiCare Agents and any of PacifiCare Entities'
regulators or other reviewing bodies (including the Joint Commission on
Accreditation of Health Care Organizations (JCAHO)) with access to and any
assistance that they may require with respect to the Service Locations and the
Systems for the purpose of performing audits or inspections of the Services and
the business of PacifiCare Entities relating to the Services, provided that
Supplier shall not be required to provide access or assistance to any PacifiCare
Agents who are Supplier Competitors. PacifiCare Agents who request access to
Supplier Service Locations or Supplier Confidential Information, including
Supplier Background Technology and Supplier Tools, shall first sign and deliver
to Supplier a confidentiality agreement in a form substantially similar to
Schedule 19.1. Upon receipt of notification from PacifiCare that PacifiCare
Agents request such access, Supplier shall furnish the confidentiality agreement
to PacifiCare Agents for signature. If any audit by an auditor designated by
PacifiCare, a PacifiCare Agent or a regulatory authority results in Supplier
being notified that Supplier or Supplier Agents are not in compliance with any
Law or audit requirement, Supplier shall, and shall cause Supplier Agents to,
promptly take actions to comply with such Law or audit requirement. Supplier
shall bear the expense of any such response that is (a) required by a Supplier
Law or audit requirement relating to Supplier's business or (b) necessary due to
Supplier's noncompliance with any Law or audit requirement imposed on Supplier
as set forth in this Agreement. To the extent the expense is not payable by
Supplier pursuant to the preceding sentence, PacifiCare shall bear the expense
of any such compliance that is required by any Law or audit requirement relating
to PacifiCare Entities' business or that is necessary due to PacifiCare
Entities' noncompliance with any Law or audit requirement imposed on PacifiCare
Entities.

      19.2 FEES. Upon notice from PacifiCare, Supplier shall provide PacifiCare
and PacifiCare Agents with access to such financial records and supporting
documentation as may be requested by PacifiCare, provided that Supplier shall
not be required to provide access to any financial records or supporting
documentation to any PacifiCare Agents who are Supplier Competitors, and
PacifiCare and PacifiCare Agents may audit the Fees charged to PacifiCare to
determine if such Fees are accurate and in accordance with this Agreement
(including Section 17.11). PacifiCare Agents who request access to such
financial records and supporting documentation or Supplier Confidential
Information, including Supplier Background Technology and Supplier Tools, shall
first sign and deliver to Supplier a confidentiality agreement in a form
substantially similar to Schedule 19.1. Upon receipt of notification from
PacifiCare that PacifiCare Agents request such access, Supplier shall furnish
the confidentiality agreement to PacifiCare Agents for signature.

            (a) If, as a result of such audit, PacifiCare determines that
Supplier has overcharged PacifiCare, PacifiCare shall notify Supplier of the
amount of such overcharge and Supplier shall promptly pay to PacifiCare the
amount of the overcharge, plus Interest calculated from the date of receipt by
Supplier of the overcharged amount until the date of payment to PacifiCare.

                                      32.
<PAGE>

            (b) In addition to PacifiCare's rights set forth in Section 19.2, in
the event any such audit reveals an overcharge to PacifiCare of [...***...] or
more of the total Fees during the applicable period covered by the audit,
Supplier shall, at PacifiCare's option, issue to PacifiCare a credit against the
Base Fees or reimburse PacifiCare for the cost of such audit.

      19.3 OMNIBUS RECONCILIATION ACT. Without limiting the foregoing, until the
expiration of four (4) years after the End Date, Supplier agrees that the
Secretary of the Department of Health and Human Services (the "SECRETARY") and
the Comptroller General of the United States, or the designee or duly authorized
representative of either of them, shall have access to all books and records of
Supplier directly pertaining to the subject matter of this Agreement and the
provision of Services under it, in accordance with the criteria presently or
hereafter developed by the Department of Health and Human Services as provided
in Section 1861(v)(1)(I) of the Social Security Act, 42 U.S.C. ss.
1395x(v)(1)(I). Upon request of the Secretary, the Comptroller General, the
designee oR the authorized representative of either of them, Supplier shall make
available (at reasonable times and places during normal business hours) this
Agreement, and all books, documents, and records of Supplier that are necessary
to verify the nature and extent of the costs of the Services provided by
Supplier and furnished in connection with this Agreement. Supplier further
agrees that if Supplier carries out any of the duties of this Agreement through
a subcontract with a value or cost of [...***...] or more, such subcontract
shall contain a clause to the effect that until the expiration of four (4) years
after the furnishing of such services pursuant to such subcontract, the
subcontracting party shall make available, upon written request of the
Secretary, or upon request of the U.S. Comptroller General or any of their duly
authorized representatives, the subcontract, and the books, documents and
records of such organization that are necessary to verify the nature and extent
of such costs of the Services provided by such subcontracting party and
furnished in connection with this Agreement, provided that the foregoing shall
not apply with regard to the Affected Contractors and subcontractors referenced
in Sections 12.4(e) and 12.4(f) engaged by Supplier pursuant to this Agreement.
Supplier shall promptly inform PacifiCare of any requests for information made
pursuant to this provision.

      19.4 RECORD RETENTION. Supplier shall retain records and supporting
documentation sufficient to satisfy the requirements set forth in this Section
19 and to document the Services and the Fees paid or payable by PacifiCare under
this Agreement in accordance with PacifiCare's retention policies and procedures
which PacifiCare adheres to as of the Effective Date and set forth in Schedule
19.4, and as in effect from time to time.

      19.5 FACILITIES. Supplier shall provide to PacifiCare and PacifiCare
Agents, on Supplier's premises (or, if the audit is being performed of a
Supplier Agent, the Supplier Agent's premises if necessary), space, office
furnishings (including lockable cabinets) and utilities as PacifiCare or such
PacifiCare Agents may reasonably require to perform the audits described in this
Section.

      19.6 AUDIT SOFTWARE. Supplier shall operate and maintain such audit
software as PacifiCare may request from time to time during the Term.

                                      33.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

      19.7 RELIEF. In the event that the frequency or scope of PacifiCare's
audits of Supplier's records under Sections 19.1 and 19.2 above are such that
Supplier can demonstrate to PacifiCare that Supplier's compliance with the
requirements of the aforesaid sections will have a material adverse effect on
Supplier's ability to provide the Services in accordance with the applicable
Service Levels, the Parties will negotiate in good faith to determine an
appropriate duration and level of applicable Service Level relief for Supplier
to be able to comply with its obligations under Sections 19.1 and 19.2.
PacifiCare and PacifiCare Entities shall reimburse Supplier its actual and
reasonable costs and expenses in excess of five thousand dollars ($5,000) per
audit associated with an audit of Supplier's records pursuant to Sections 19.1
and 19.2.

20.   CONFIDENTIALITY.

      20.1 GENERAL OBLIGATIONS. All Confidential Information relating to or
obtained from PacifiCare Entities or Supplier shall be held in strict confidence
by the recipient to the same extent and in at least the same manner as the
recipient protects its own confidential information of similar importance.
Neither PacifiCare nor Supplier shall disclose, publish, release, transfer or
otherwise make available Confidential Information of, or obtained from, the
other Party in any form to, or for the use or benefit of, any person or entity
without the disclosing Party's consent.

      20.2 EXCEPTIONS. Notwithstanding the foregoing, each of PacifiCare and
Supplier shall be permitted to disclose relevant aspects of the other's
Confidential Information to its officers, directors, agents, professional
advisors, contractors (including the Benchmarker), subcontractors and employees
and to the officers, directors, agents, professional advisors, contractors,
subcontractors and employees of its affiliates, to the extent such disclosure is
not restricted under any Assigned Agreements, any Managed Agreements, any
Consents or any Laws or Governmental Approvals and only to the extent that such
disclosure is reasonably necessary for the performance of its duties and
obligations or the determination, preservation or exercise of its rights and
remedies under this Agreement; provided, however, that the recipient shall take
all reasonable measures to ensure that Confidential Information of the
disclosing Party is not disclosed or duplicated in contravention of the
provisions of this Agreement by such officers, directors, agents, professional
advisors, contractors, subcontractors and employees and Confidential Information
shall not be disclosed to PacifiCare Competitors or Suppler Competitors. Third
parties who request access to Supplier Confidential Information or PacifiCare
Confidential Information shall first sign and deliver to the disclosing party a
confidentiality agreement containing terms substantially similar to Schedule
19.1. Furthermore, nothing in this Agreement shall limit the ability of a Party
in possession of the Confidential Information of the other Party to disclose
such Confidential Information, and such Party shall have no liability for such
disclosure, if such disclosure is: (a) required to be made pursuant to Law,
government authority, duly authorized subpoena or court order, whereupon the
receiving Party shall provide prompt notice to the disclosing Party and give
such Party an opportunity to respond prior to such disclosure; (b) required to
be made to a court or other tribunal in connection with the enforcement of such
Party's rights under this Agreement; or (c) is approved by the prior consent of
the disclosing Party.

      20.3 ATTORNEY-CLIENT PRIVILEGE. Supplier recognizes that it may obtain
access to client documents, data and databases created by and for PacifiCare
Entities and associated

                                      34.
<PAGE>

communications related thereto that are marked "privileged" or contain a similar
marking or are otherwise identified by PacifiCare as privileged (collectively,
"PRIVILEGED WORK PRODUCT") that are confidential attorney work product or
subject to the attorney-client privilege. Supplier shall not intentionally
reveal Privileged Work Product to third parties and Supplier shall institute
adequate safeguards to prevent the unintentional disclosure of Privileged Work
Product to third parties. The only Project Staff who may have access to
Privileged Work Product shall be those for whom such access is necessary for the
purpose of providing services to PacifiCare Entities as provided in this
Agreement. All Project Staff who shall need access to Privileged Work Product
shall first sign and deliver to PacifiCare a confidentiality agreement
satisfactory to PacifiCare. Supplier recognizes that Privileged Work Product has
been prepared in anticipation of litigation and that Supplier is performing the
Services in respect of Privileged Work Product as an agent of PacifiCare, and
that all matter related thereto is protected from disclosure by Rule 26 of the
United States Federal Rules of Civil Procedure (or any similar Law in other
local jurisdictions). Should Supplier ever be notified of any judicial or other
proceeding seeking to obtain access to Privileged Work Product, Supplier shall
(a) immediately notify PacifiCare and (b) take such reasonable actions as may be
specified by PacifiCare to resist providing such access. PacifiCare shall have
the right and duty to represent Supplier in such resistance or to select and
compensate counsel to so represent Supplier or to reimburse Supplier for
reasonable attorneys' fees and expenses incurred in resisting such access.

      20.4 UNAUTHORIZED ACTS. Without limiting either Party's rights in respect
of a breach of this Section, each Party shall:

            (a) promptly notify the other Party of any unauthorized possession,
use or knowledge, or attempt thereof, of the other Party's Confidential
Information by any person or entity that may become known to such Party;

            (b) promptly furnish to the other Party full details of the
unauthorized possession, use or knowledge, or attempt thereof, and assist the
other Party in investigating or preventing the recurrence of any unauthorized
possession, use or knowledge, or attempt thereof, of Confidential Information;

            (c) cooperate with the other Party in any litigation and
investigation against third parties deemed necessary by the other Party to
protect its proprietary rights (provided that the other Party shall pay such
Party's reasonable costs and expenses arising out of its cooperation with any
litigation hereunder); and

            (d) promptly use its best efforts to prevent a recurrence of any
such unauthorized possession, use or knowledge, or attempt thereof, of
Confidential Information.

            Except as otherwise noted, each Party shall bear the cost it incurs
as a result of compliance with this Section.

      20.5 INJUNCTIVE RELIEF. The Parties acknowledge and agree that monetary
damages may be inadequate to compensate for a breach of the provisions contained
in this Section 20 or other confidentiality provisions of this Agreement. In the
event of such breach, the injured Party

                                      35.
<PAGE>

may be entitled to seek injunctive relief and any and all other remedies
available at law or in equity. This Section in no way limits the liability or
damages that may be assessed against a Party in the event of a breach by the
other Party of any of the provisions of this Section.

21.   REPRESENTATIONS AND WARRANTIES.

            21.1 BY PACIFICARE. PacifiCare represents and warrants that:

                  (a) PacifiCare is a corporation duly incorporated, validly
existing and in good standing under the Laws of the State of Delaware;

                  (b) PacifiCare has all requisite corporate power and authority
to execute, deliver and perform its obligations under this Agreement;

                  (c) the execution, delivery and performance of this Agreement
by PacifiCare (i) has been duly authorized by PacifiCare and (ii) shall not
conflict with, result in a breach of or constitute a default under any other
agreement to which PacifiCare is a party or by which PacifiCare is bound;

                  (d) PacifiCare is duly licensed, authorized or qualified to do
business and is in good standing in every jurisdiction in which a license,
authorization or qualification is required for the ownership or leasing of its
assets or the transaction of business of the character transacted by it, except
where the failure to be so licensed, authorized or qualified would not have a
material adverse effect on PacifiCare's ability to fulfill its obligations under
this Agreement;

                  (e) PacifiCare has obtained all applicable permits and
licenses required of PacifiCare in connection with its obligations under this
Agreement except where the failure to obtain such permits and licenses would not
have a material adverse effect on PacifiCare's ability to fulfill its
obligations under this Agreement; and

                  (f) the PacifiCare Proprietary Software and, to the best of
PacifiCare's knowledge, the PacifiCare Third Party Software, does not infringe
upon the proprietary rights of any third party.

      21.2 BY SUPPLIER. Supplier represents and warrants that:

            (a) Supplier is a corporation duly incorporated, validly existing
and in good standing under the Laws of the Commonwealth of Massachusetts;

            (b) Supplier has all requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement;

            (c) the execution, delivery and performance of this Agreement by
Supplier (i) has been duly authorized by Supplier and (ii) shall not conflict
with, result in a breach of or constitute a default under any other agreement to
which Supplier is a party or by which Supplier is bound;

                                      36.
<PAGE>

            (d) Supplier is duly licensed, authorized or qualified to do
business and is in good standing in every jurisdiction in which a license,
authorization or qualification is required for the ownership or leasing of its
assets or the transaction of business of the character transacted by it, except
where the failure to be so licensed, authorized or qualified would not have a
material adverse effect on Supplier's ability to fulfill its obligations under
this Agreement;

            (e) Supplier is in compliance with all Supplier Laws applicable to
Supplier's obligations under this Agreement and has obtained all applicable
permits and licenses required of Supplier in connection with its obligations
under this Agreement;

            (f) there is no outstanding litigation, arbitrated matter or other
dispute to which Supplier is a party that, if decided unfavorably to Supplier,
would reasonably be expected to have a material adverse effect on Supplier's
ability to fulfill its obligations under this Agreement; and

            (g) the Supplier Software does not infringe upon the proprietary
rights of any third party (except as may have been caused by a modification by
PacifiCare Entities or PacifiCare Entity Agents).

      21.3 DISCLAIMER. EXCEPT AS SPECIFIED IN SECTION 21.1 AND SECTION 21.2,
NEITHER PACIFICARE NOR SUPPLIER MAKES ANY OTHER WARRANTIES WITH RESPECT TO THE
SERVICES OR THE SYSTEMS AND EACH EXPLICITLY DISCLAIMS ALL OTHER WARRANTIES,
EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS
FOR A SPECIFIC PURPOSE, TITLE, AND NONINFRINGEMENT OF THIRD PARTY RIGHTS.

22.   ADDITIONAL COVENANTS.

      22.1 BY PACIFICARE. PacifiCare covenants and agrees with Supplier that
during the Term and the Termination Assistance Period:

            (a) PacifiCare shall comply with all Laws applicable to PacifiCare,
except where the failure to comply would not have a material adverse effect on
PacifiCare's ability to fulfill its obligations under this Agreement; and

            (b) the PacifiCare Proprietary Software set forth in Schedule
14.2(a) shall not infringe upon the proprietary rights of any third party
(except as may have been caused by a modification by Supplier or Supplier
Agents).

      22.2 BY SUPPLIER. Supplier covenants and agrees with PacifiCare that
during the Term and the Termination Assistance Period:

            (a) in addition to meeting or exceeding all Service Levels, Supplier
shall at all times render the Services promptly and diligently and perform in a
professional and workmanlike manner;

            (b) Supplier shall at all times use qualified individuals with
suitable training, education, competence and skill to perform the Services;

                                      37.
<PAGE>

            (c) Supplier shall comply with all Supplier Laws;

            (d) subject to Section 3.3(b), from and after the Effective Date, in
providing the Services, Supplier shall comply with Medical Confidential
Information Laws, including Medical Confidential Information Laws that
PacifiCare, as a Covered Entity, is required to require Supplier to comply with
as a Business Associate, and in the event that the requirements of any Medical
Confidential Information Laws are more restrictive or protective of information
than the confidentiality and nondisclosure provisions of this Agreement, the
Medical Confidential Information Laws shall control;

            (e) none of the Services, the Developed Software, the Work Product
(including Web Content, if any), the Supplier Software, any enhancements or
modifications to the PacifiCare Software performed by Supplier or Supplier
Agents or any other resources or items provided to PacifiCare by Supplier or
Supplier Agents shall infringe upon the proprietary rights of any third party
(except as may have been caused by a modification by PacifiCare Entities or
PacifiCare Entity Agents);

            (f) Supplier shall use commercially reasonable efforts to prevent
the introduction or coding of viruses or similar items into the Systems, and, in
the event a virus or similar item is introduced into the Systems, Supplier shall
use commercially reasonable efforts to assist PacifiCare Entities in reducing
the effects of the virus or similar item and, if such virus or similar item
causes a loss of operational efficiency or loss of data, to assist PacifiCare
Entities to the same extent to mitigate and restore such losses; and

            (g) without the consent of PacifiCare, Supplier shall not insert
into the Software used to provide the Services any code that would have the
effect of disabling or otherwise shutting down all or any portion of the
Services. Supplier further covenants that, with respect to any disabling code
that may be part of the Software used to provide the Services, Supplier shall
not invoke such disabling code at any time, including upon expiration or
termination of this Agreement, without PacifiCare's consent.

23.   DISPUTE RESOLUTION.

      23.1 RESOLUTION PROCEDURES. Except as otherwise provided below, the
Parties shall attempt to resolve any dispute arising under or related to this
Agreement (a "DISPUTE") in accordance with the procedures set forth in this
Section 23.1.

            (a) RELATIONSHIP MANAGERS. Within [...***...] after either Party
notifies the other Party of a Dispute, the PacifiCare [...***...] and the
Supplier [...***...] shall consider the Dispute in person or by telephone and
shall attempt in good faith to resolve the Dispute for a period of [...***...]
in the event of a Dispute regarding any Fees. If the Dispute is not resolved, as
agreed by the Parties in writing, within such [...***...] (or, in the case of a
Dispute regarding Fees, [...***...] period, the Dispute shall be escalated in
accordance with Section 23.1(b) below.

                                      38.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

            (b) SENIOR EXECUTIVES. If a Dispute is not resolved in accordance
with Section 23.1(a) above in the case of PacifiCare, a Senior Executive-level
executive, and in the case of Supplier, a Group Vice President (each, a "SENIOR
EXECUTIVE"), shall consider the Dispute in person at a mutually agreeable time
and date and at a PacifiCare Service Location or other mutually agreeable
location and shall attempt in good faith to resolve the Dispute for a period of
[...***...] in the event of a Dispute regarding Fees. Unless such Senior
Executives otherwise agree in writing, either Party may pursue its rights and
remedies under this Agreement after the expiration of [...***...] period.

      23.2 EXCLUSIONS. Notwithstanding the foregoing, no Dispute relating to
Section 15.4, Section 20 or Section 26 shall be subject to Section 23.1. In
addition, nothing in this Agreement shall limit either Party's right to seek
immediate injunctive or other equitable relief whenever the facts or
circumstances would permit a Party to seek such relief in a court of competent
jurisdiction.

      23.3 CONTINUITY OF SERVICES. Supplier acknowledges that the timely and
complete performance of its obligations pursuant to this Agreement is critical
to the business and operations of PacifiCare Entities. In the event of a dispute
between PacifiCare and Supplier, each of the Parties shall continue to perform
its respective obligations under this Agreement in good faith during the
resolution of such dispute unless and until this Agreement is terminated in
accordance with the provisions hereof.

24.   TERMINATION.

      24.1 TERMINATION FOR CONVENIENCE. [...***...], PacifiCare may terminate
this Agreement, [...***...] by giving Supplier notice of the termination at
least one hundred eighty (180) days prior to the termination date specified in
the notice.

      24.2 TERMINATION FOR CHANGE IN CONTROL. In the event of a Change in
Control of Supplier, PacifiCare or either Party's respective parent companies,
PacifiCare may terminate this Agreement, at its sole discretion, by giving
Supplier notice of the termination at least one hundred eighty (180) days prior
to the termination date specified in the notice.

      24.3 TERMINATION FOR CAUSE.

            (a) If Supplier defaults in the performance of any of its material
obligations (including by repeatedly defaulting in the performance of any of its
obligations which, when combined, constitute a breach of a material obligation)
under this Agreement (except as provided in Section 24.4), and does not cure
such default within [...***...] days (the "SUPPLIER DEFAULT CURE PERIOD") after
receipt of a notice of default from PacifiCare (the "SUPPLIER DEFAULT NOTICE"),
then PacifiCare may, without limiting PacifiCare's other rights or remedies
under this Agreement, by giving notice to Supplier, terminate this Agreement, in
whole or in part, as of the termination date specified in the Supplier Default
Notice.

                                      39.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

            (b) If PacifiCare fails to make undisputed payments due to Supplier
under this Agreement and does not pay such undisputed amounts within [...***...]
days (the "PACIFICARE DEFAULT CURE PERIOD") of receipt of Supplier's notice of
PacifiCare's failure to pay such undisputed amounts (the "PACIFICARE DEFAULT
NOTICE"), then Supplier may, by giving notice to PacifiCare, terminate this
Agreement in whole as of the termination date specified in the PacifiCare
Default Notice. If PacifiCare disputes any amounts that are the subject of the
PacifiCare Default Notice and fails to pay such amounts in accordance with
Section 17.7 (Fee Dispute) during the PacifiCare Default Cure Period (subject to
resolution of such dispute), then Supplier may, by giving notice to PacifiCare,
terminate this Agreement in whole as of the termination date specified in the
PacifiCare Default Notice.

      24.4 TERMINATION FOR FAILURE TO PROVIDE CRITICAL SERVICES. If Supplier
fails to provide any Critical Service and does not, within [...***...] after
such failure identified on Schedule 24.4 with respect to such Critical Service,
cure such failure or, if such failure cannot be cured within [...***...]
identified on Schedule 24.4 with respect to such Critical Service, provide
PacifiCare with a workaround that allows PacifiCare to receive such Critical
Service.

      24.5 INSOLVENCY. Either Party may, by giving notice thereof to the Party,
terminate this Agreement in whole as of the date specified in such termination
notice if the other Party:

            (a) admits in writing its inability to pay its debts as such debts
become due;

            (b) applies for or consent to the appointment of, or the taking of
possession by, a receiver, custodian, trustee, examiner or liquidator of itself
or of all or a substantial part of its property or assets;

            (c) makes a general assignment for the benefit of its creditors;

            (d) commences a voluntary case under the Bankruptcy Code (11
U.S.C.ss.101 et seq., as amended);

            (e) files a petition seeking to take advantage of any other law
relating to bankruptcy, insolvency, reorganization, liquidation, dissolution,
arrangement or winding-up, or composition or readjustment of debts; or

            (f) fails to controvert in a timely and appropriate manner, or
acquiesce in writing to, any petition filed against it in an involuntary case
under the Bankruptcy Code, or takes any corporate, partnership or other action
for the purpose of affecting any of the foregoing.

      24.6 OTHER TERMINATIONS. In addition to the provisions of this Section,
this Agreement may be terminated as provided in Section [...***...] and Section
16.3.

25.   TERMINATION FEES.

      25.1 EARLY TERMINATION FEE. If PacifiCare terminates this Agreement for
any reason, then PacifiCare shall pay Supplier the applicable early termination
fees in accordance with

                                      40.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

Schedule 17 (the "EARLY TERMINATION FEES"), provided, however, that PacifiCare
shall not pay any Early Termination Fees if PacifiCare terminates this Agreement
pursuant to Section 24.1 with such Termination to be effective, commencing at
any time during the eighth (8th), ninth (9th), or tenth (10th) Contract Year of
this Agreement. PacifiCare shall pay the Early Termination Fee within thirty
(30) days of the last day of the month in which Supplier is providing
Termination Services following termination.

      25.2 NO OTHER FEES. Except as expressly set forth in this Section 25 and
Section 26 below, PacifiCare shall have no obligation to pay any termination fee
or other fees to Supplier in connection with the termination of this Agreement,
and any recovery or remedy sought by Supplier for such termination shall be
limited to the Early Termination Fee set forth in this Section 25 and the
Termination Services Fees (as defined in Section 26.2).

26.   TERMINATION ASSISTANCE.

      26.1 TERMINATION ASSISTANCE SERVICES.

            (a) Commencing up to six (6) months before the expiration or earlier
termination of this Agreement, upon the request of and as specified by
PacifiCare, and continuing through the effective date of expiration or
termination of this Agreement, Supplier shall provide, at no additional charge
to PacifiCare to the extent that such assistance can be provided through
resources included in the Fees, all information and assistance necessary to
ensure the smooth transition of the Services (and other functions being
performed by Supplier and Supplier Agents at the time of such expiration or
termination) to PacifiCare or another service provider of PacifiCare's choosing,
which such assistance shall include, if applicable, capacity planning,
consulting services, facilities planning, telecommunications planning, Software
configuration, reviewing all system Software with a new service provider or its
agents, generating machine readable listings of source code, uploading
production databases, providing parallel processing, testing and, where
applicable, providing Equipment (individually and collectively, the "TERMINATION
SERVICES").

            (b) PacifiCare may also (i) upon the request of and as specified by
PacifiCare, require Supplier to provide Base Services and the Termination
Services for an extension period of up to twelve (12) months following the
effective date of expiration or termination of this Agreement and (ii) at the
end of the first extension period and upon the request of and as specified by
PacifiCare, require Supplier to provide the Base Services and Termination
Services for an additional extension period of up to six (6) months following
the end of the first extension period (collectively, the period of Termination
Services prior to the effective date of expiration or termination of this
Agreement together with any extension periods referred to as the "TERMINATION
ASSISTANCE PERIOD"). PacifiCare will provide Supplier with written notice of its
intent to request assistance under this Section at least ninety (90) days prior
to the expiration or termination of this Agreement or the first extension
period, as appropriate.

            (c) During the Termination Assistance Period, Supplier shall
continue to provide the Base Services in addition to the Termination Services
until PacifiCare, in its sole discretion, provides Supplier notice that the Base
Services have been satisfactorily transferred to

                                      41.
<PAGE>

PacifiCare or another service provider, at which time Supplier shall cease
providing any Base Services or Termination Services.

            (d) The quality and level of Termination Services and other Service
performed during the Termination Assistance Period shall not be degraded from
the Service Levels provided by Supplier and Supplier Agents for similar Services
prior to such termination.

            (e) After the expiration of the Termination Assistance Period,
Supplier shall (i) answer questions from PacifiCare Entities regarding the
Services on an "as needed" basis at Supplier's then-standard billing rates and
(ii) deliver to PacifiCare any remaining PacifiCare Entity-owned reports and
documentation still in Supplier's possession.

      26.2 TERMINATION SERVICES FEES.

            (a) With respect to Termination Services that were Services
performed under this Agreement prior to the Termination Assistance Period:

                  (i) During the Termination Assistance Period prior to the
expiration or termination of this Agreement, Supplier shall provide Termination
Services at no additional charge to PacifiCare to the extent that such
assistance can be provided through resources included in the Fees. To the extent
that any Termination Services cannot be so provided, PacifiCare shall pay
Supplier at the rates then applicable under this Agreement for such Services.

                  (ii) During the Termination Assistance Period after the
expiration or termination of this Agreement, if applicable, PacifiCare shall pay
Supplier at the ARC rates then applicable and set forth in Attachment 3 of
Schedule 17 under this Agreement for such Services.

            (b) With respect to Termination Services that were not Services
performed under this Agreement prior to the Termination Assistance Period,
PacifiCare shall pay Supplier the New Services Fees set forth in Attachment 4 of
Schedule 17.

            (c) The fees paid for Termination Services (the "TERMINATION
SERVICES FEES") are to be paid in accordance with the payment terms for Base
Fees set forth in Section 17.2.

      26.3 EXIT DUTIES AND EXIT RIGHTS. Upon the later of the expiration or
termination of this Agreement and the last day of the Termination Assistance
Period (the "END DATE"):

            (a) The rights granted to Supplier and Supplier Agents in Section
14.2 shall immediately terminate and Supplier shall, and shall cause Supplier
Agents to, (i) deliver to PacifiCare, at no cost to PacifiCare, a current copy
of the PacifiCare Software in the form in use as of the End Date and (ii)
destroy or erase all other copies of the PacifiCare Software in Supplier's or
Supplier Agents' possession. Supplier shall, upon PacifiCare's request, certify
to PacifiCare that all such copies have been destroyed or erased.

            (b) Subject to Sections 14.3 and 14.4 herein, Supplier shall
promptly deliver to PacifiCare a copy of the Supplier Proprietary Software and
Supplier proprietary Tools in the

                                      42.
<PAGE>

form in use for performance of the Services as of the End Date. Supplier shall
also provide to PacifiCare Entities support and maintenance services for such
Software and Tools on terms, conditions and prices agreed upon by the Parties,
which shall in no event [...***...]

            (c) Subject to Sections 14.3 and 14.4 herein, upon PacifiCare's
request, with respect to Supplier Third Party Software and the Tools that
Supplier has licensed from a third party and is using to provide the Services as
of the End Date, Supplier shall, to the extent permissible under Supplier's
agreements with such third parties, transfer, assign or sublicense such Supplier
Third Party Software and Supplier Third Party Tools to PacifiCare or its
designee. Upon PacifiCare's request and expense, Supplier shall assist
PacifiCare Entities in obtaining directly from third parties any Third Party
Software and/or Tools for which PacifiCare does not elect to assume the
applicable third party agreements.

            (d) Subject to the license terms set forth in Sections 14.3 and 14.4
above, upon PacifiCare's request, for a period of [...***...], with respect to
any Supplier Software or Tools, to the extent permissible under Supplier's
agreements with any third parties, that Supplier is using to provide the
Services as of the date of termination or expiration of this Agreement and that
Supplier operates on equipment located at one or more Supplier Service
Locations, Supplier shall provide to PacifiCare Entities or PacifiCare's
designees remote access to and use of such Supplier Software and Tools, together
with all hosting, maintenance, support and other services required for
PacifiCare Entities or PacifiCare's designees to Use such Supplier Software and
Tools solely to the extent required to continue the Services after the End Date,
all on terms, conditions and prices agreed upon by the Parties, which shall in
no event [...***...]. Supplier shall provide such additional assistance as may
be necessary to permit PacifiCare to establish the same or similar functions on
equipment at PacifiCare's or another service provider's locations at
PacifiCare's cost.

            (e) Supplier shall (i) deliver to PacifiCare a copy of all of the
Developed Software and Work Product, in the form in use as of the End Date, and
(ii) destroy or erase all other copies of the Developed Software and the Work
Product in Supplier's possession.

            (f) Upon PacifiCare's request and to the extent permissible by the
applicable third party agreements, with respect to (i) any agreements for
maintenance or other third party services, and (ii) any Assigned Agreements not
otherwise covered by the preceding subsection, Supplier shall, and shall cause
Supplier Agents to, transfer or assign such agreements to PacifiCare Entities or
PacifiCare's designees, on terms and conditions acceptable to all applicable
parties. Upon PacifiCare's request and cost, Supplier shall assist PacifiCare
Entities in obtaining directly from third parties any third party services for
which PacifiCare does not elect to assume the applicable third party agreements.

            (g) Upon PacifiCare's request, Supplier shall return to PacifiCare
or its designee any assets transferred by PacifiCare Entities to Supplier or
Supplier Agents not covered by the preceding subsection, free and clear of all
liens, security interests or other encumbrances.

                                      43.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

Supplier shall also return to PacifiCare Entities all user and other
documentation in its possession that relates to such assets.

            (h) Commencing on the End Date, or such earlier date that Supplier
is no longer required to meet Service Levels, PacifiCare shall have the right to
extend offers of employment to all Supplier and Supplier Agent personnel who
have been or are assigned to or have or are performing any Services or other
work on behalf of Supplier or Supplier Suppliers with respect to PacifiCare.
Supplier and Supplier Suppliers shall provide reasonable access to such
personnel and shall not interfere with any such solicitation by PacifiCare.

            Where any of the foregoing rights under this Section 26.3 may be
requested by PacifiCare, PacifiCare may request such rights before the End Date.

27.   INDEMNITIES.

      27.1 INDEMNITY BY PACIFICARE. PacifiCare shall indemnify Supplier from,
and defend and hold Supplier harmless from and against, any Losses suffered,
incurred or sustained by Supplier or to which Supplier becomes subject,
resulting from, arising out of or relating to any claim:

            (a) that the PacifiCare Proprietary Software infringes upon the
proprietary rights of any third party (except as may have been caused by a
modification by Supplier or Supplier Agents or by written directions or
specifications provided to PacifiCare by Supplier or Supplier Agents);

            (b) relating to the inaccuracy, untruthfulness or breach of any
representation or warranty made by PacifiCare under this Agreement;

            (c) relating to (i) a violation by PacifiCare or PacifiCare Agents
of Law for the protection of persons or members of a protected class or category
of persons, including unlawful discrimination, (ii) work-related injury (except
as may be covered by PacifiCare's workers' compensation plan) or death caused by
PacifiCare or PacifiCare Agents, (iii) accrued employee benefits not expressly
assumed by Supplier, (iv) any representations, oral or written, made by
PacifiCare or PacifiCare Agents to the Affected Employees and (v) any other
aspect of the Affected Employees' employment relationship with PacifiCare or
termination of such employment relationship with PacifiCare (including claims
for breach of an express or implied contract of employment);

            (d) relating to any amounts, including taxes, interest and
penalties, assessed against Supplier that are the obligation of PacifiCare
pursuant to Section 18;

            (e) relating to personal injury (including death) or property loss
or damage resulting from PacifiCare's acts or omissions;

            (f) relating to a breach of Section 20;

                                      44.
<PAGE>

            (g) relating to PacifiCare's failure to comply with the Governmental
Approvals applicable to PacifiCare, and PacifiCare's failure to obtain and
maintain the PacifiCare Government Approvals;

            (h) relating to a breach of any of the covenants in Section 22.1.

            [...***...]

      27.2 INDEMNITY BY SUPPLIER. Supplier shall indemnify PacifiCare Entities
from, and defend and hold PacifiCare Entities harmless from and against, any
Losses suffered, incurred or sustained by PacifiCare Entities or to which
PacifiCare Entities become subject resulting from, arising out of or relating to
any claim:

            (a) that the Developed Software, Work Product, Supplier Tools,
Supplier Software, any enhancements or modifications to the PacifiCare Software
performed by Supplier or Supplier Agents or any other resources or items
provided to PacifiCare Entities by Supplier or Supplier Agents infringe upon the
proprietary or other rights of any third party (except as may have been caused
by a modification by PacifiCare Entities or PacifiCare Entity Agents, or by
written directions or specifications provided to Supplier by PacifiCare or
PacifiCare Entities);

            (b) relating to any duties or obligations of Supplier or Supplier
Agents in respect of a third party or any subcontractor of Supplier;

            (c) by a third party arising from services or systems provided by
Supplier or Supplier Agents from a Supplier Service Location that is shared with
other customers of Supplier;

            (d) relating to the inaccuracy, untruthfulness or breach of any
representation, warranty or covenant set forth in Section 21.2 made by Supplier
under this Agreement;

            (e) relating to Supplier's failure to obtain, maintain, and comply
with the Supplier Governmental Approvals;

            (f) relating to (i) a violation by Supplier or Supplier Agents of
Law for the protection of persons or members of a protected class or category of
persons, including unlawful discrimination, (ii) work-related injury (except as
may be covered by Supplier's workers' compensation plan) or death caused by
Supplier or Supplier Agents, (iii) accrued employee benefits not expressly
retained by PacifiCare Entities, (iv) any representations, oral or written, made
by Supplier or Supplier Agents to PacifiCare Entities' employees, including the
Affected Employees and (v) any other aspect of the Transitioned Personnels'
employment relationship with Supplier or the termination of the employment
relationship with Supplier (including claims for breach of an express or implied
contract of employment);

            (g) relating to Supplier's breach of Section 10.2, 10.3, 10.4 or
15.4;

                                      45.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

            (h) relating to any amounts, including taxes, interest and
penalties, assessed against PacifiCare Entities that are the obligation of
Supplier pursuant to Section 18;

            (i) relating to personal injury (including death) or property loss
or damage resulting from Supplier's or Supplier Agents' acts or omissions;

            (j) relating to a breach of Supplier obligations with respect to
PacifiCare Data (in Section 15);

            (k) relating to a breach of Section 20; and

            (l) relating to a breach of any of the covenants in Section 22.2(c),
(d), (f), and (g).

            [...***...]

      27.3 INDEMNIFICATION PROCEDURES. If any claim is commenced against a
person or entity entitled to indemnification under Section 27.1 or Section 27.2
(the "INDEMNIFIED PARTY"), notice thereof shall be given to the Party that is
obligated to provide indemnification (the "INDEMNIFYING PARTY") as promptly as
practicable. If, after such notice, the Indemnifying Party shall acknowledge
that this Agreement applies with respect to such claim, then the Indemnifying
Party shall be entitled, if it so elects, in a notice promptly delivered to the
Indemnified Party, but in no event less than ten (10) days prior to the date on
which a response to such claim is due, to immediately take sole control of the
defense and investigation of such claim and to employ and engage attorneys
reasonably acceptable to the Indemnified Party to handle and defend the same, at
the Indemnifying Party's sole cost and expense. The Indemnified Party shall
cooperate, at the cost of the Indemnifying Party in all reasonable respects with
the Indemnifying Party and its attorneys in the investigation, trial and defense
of such claim and any appeal arising therefrom. The Indemnified Party may, at
its own cost and expense, participate, through its attorneys or otherwise, in
such investigation, trial and defense of such claim and any appeal arising
therefrom, provided that such participation does not unreasonably interfere with
the Indemnifying Party's ability to defend such claim. No settlement of a claim
that involves a remedy other than the payment of money by the Indemnifying Party
shall be entered into without the consent of the Indemnified Party. After notice
by the Indemnifying Party to the Indemnified Party of its election to assume
full control of the defense of any such claim, the Indemnifying Party shall not
be liable to the Indemnified Party for any legal expenses incurred thereafter by
such Indemnified Party in connection with the defense of that claim. If the
Indemnifying Party does not assume full control over the defense of a claim
subject to such defense as provided in this Section, the Indemnifying Party may
participate in such defense, at its sole cost and expense, and the Indemnified
Party shall have the right to defend the claim in such manner as it may deem
appropriate, at the cost and expense of the Indemnifying Party.

                                      46.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

28.   DAMAGES.

      28.1 CONSEQUENTIAL DAMAGES. In no event shall either PacifiCare Entities
or Supplier be liable for any indirect, incidental, special or consequential
damages, arising out of or relating to its performance or failure to perform
under this Agreement, even if advised of the possibility of such damages.

      28.2 DIRECT DAMAGES. Each of the Parties shall be liable to the other for
any direct damages arising out of or relating to its performance or failure to
perform under this Agreement; [...***...]

      28.3 BASIS OF THE BARGAIN. Each Party acknowledges that the foregoing
limitations are an essential element of this Agreement between the Parties and
that in the absence of such limitations the pricing and other terms set forth in
this Agreement would be substantially different.

      28.4 EXCLUSIONS. The limitations or exculpations of liability set forth in
Section 28.1 and Section 28.2 shall not apply to [...***...]

29.   INSURANCE.

      29.1 TYPES AND AMOUNTS. During the term of this Agreement, Supplier shall
procure and maintain, at Supplier's sole cost and expense, the following
insurance coverages:

            (a) COMMERCIAL GENERAL LIABILITY INSURANCE, including premises,
products (if products are being provided) /completed operations (if services are
being provided) and contractual liability with limits of not less than
[...***...] per occurrence and [...***...] annual aggregate for bodily injury
and property damage. Said insurance shall be provided on an "occurrence" form.

            (b) AUTOMOBILE LIABILITY INSURANCE (if performing any activities on
PacifiCare's premises) with limits of not less than [...***...] per occurrence,
combined single limit for bodily injury and property damage, covering owned
non-owned and hired vehicles.

                                      47.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

            (c) WORKERS COMPENSATION AND EMPLOYERS LIABILITY. If the Supplier is
an employer of one or more employees, workers compensation and employers
liability coverage with minimum limits of:

                  (i)   Workers Compensation - statutory as required by law

                  (ii)  Employers Liability-

                        bodily injury by accident: [...***...] each accident

                        bodily injury by disease: [...***...] each employee

                        bodily injury by disease: [...***...] policy limit

            (d) CONSULTANT'S ERRORS AND OMISSIONS LIABILITY INSURANCE in an
amount of not less than [...***...] per occurrence and annual aggregate. The
aggregate limit shall apply separately to the liabilities arising out of this
Agreement.

            (e) If Supplier has a claims-made based policy (or policies) and
such policy (or policies) are cancelled or not renewed, Supplier agrees to
exercise any option contained in said policy (or policies) to extend the
reporting period to the maximum period permitted; provided, however, that
Supplier need not exercise such option if the superseding insurer shall accept
all prior claims.

            (f) Supplier may satisfy the coverage minimums set forth in
29.1(a)-(d) by any combination of primary or umbrella coverage, provided that
any umbrella coverage used to meet the coverage minimums set forth in
29.1(a)-(d) must meet or exceed the aggregate coverage minimums for all claims
required to be covered by such umbrella coverage.

      29.2 SUPPLIER AGENTS. Supplier shall require that each Supplier Agent
carry Commercial General Liability insurance, including premises, products,
completed operations and contractual liability insurance, and in addition, carry
Automobile Liability insurance (if performing on PacifiCare's premises), Workers
Compensation and Employers Liability insurance, Consultant's Errors and
Omissions and Internet Errors and Omissions insurance. Except with regard to the
Affected Contractors and subcontractors referenced in Sections 12.4(e) and
12.4(f) engaged by Supplier pursuant to this Agreement, Supplier shall require
that all Supplier Agents shall carry the aforementioned insurance with the same
minimum limits as required for Supplier in Section 29.1 above.

      29.3 DOCUMENTATION. Each of Supplier's and Supplier Agents' insurance
policies shall:

            (a) be issued by companies that are admitted insurers in the
jurisdiction in which the services or products are being provided;

                                      48.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

            (b) be issued by companies that have an A. M. Best rating of not
less than "A-", and are in a size category which is not lower than "VIII";

            (c) be primary and noncontributory with any of PacifiCare's
insurance;

            (d) name PacifiCare as an additional insured; (except Workers
Compensation, Employers Liability and Errors and Omissions coverages) and

            (e) provide PacifiCare with thirty (30) days prior notice of
cancellation, non-renewal or material change in the form or limits of coverage.

            (f) Supplier and Supplier Agents shall cause its insurance carriers,
brokers or agents to issue to PacifiCare certificates of insurance evidencing
all insurance coverages, and any renewals thereof, required by this Section.

            (g) Notwithstanding any other provision of this Agreement, failure
to provide the certificates of insurance shall be considered a default by
Supplier subject to termination of this Agreement pursuant to Section 24.3.

      29.4 SELF-INSURANCE. If any of the required coverages are provided by a
self-insurance arrangement, a wholly owned insurance subsidiary (captive) or a
risk retention group, the above requirement may be waived at the sole discretion
of PacifiCare, but only after review of the self-insured's, captive's or risk
retention group's most current audited financial statement and actuarial report.
In addition Supplier agrees, during the Term of this Agreement, to provide
PacifiCare with updated financial statements and actuarial reports within a
reasonable time after the close of each of the self-insurance program's plan
year.

      29.5 INTENTIONS. None of the foregoing requirements as to the type and
limits of insurance to be maintained by Supplier and Supplier Agents are
intended to and shall not in any manner limit or qualify the liabilities and
obligations assumed by Supplier under this Agreement.

30.   MISCELLANEOUS PROVISIONS.

      30.1 AMENDMENTS. No amendment to, or change, waiver or discharge of, any
provision of this Agreement shall be valid unless in writing and signed by, in
the case of PacifiCare, the PacifiCare Supplier Relationship Manager, and in the
case of the Supplier, the Supplier Client Relationship Manager.

      30.2 ASSIGNMENT.

            (a) Neither Party shall, without the consent of the other Party,
assign this Agreement or any amounts payable pursuant to this Agreement, except
that PacifiCare may assign this Agreement to an affiliate or another entity or
business unit of PacifiCare or pursuant to a reorganization or Change in Control
of PacifiCare without such consent. Upon PacifiCare's assignment of this
Agreement to an affiliate or another PacifiCare entity or business unit or
pursuant to a reorganization or Change in Control of PacifiCare, PacifiCare
shall be released from any obligation or liability under this Agreement,
provided that, except with respect to a

                                      49.
<PAGE>

Change in Control of PacifiCare, Supplier consents to such release (which
consent may only be withheld based solely on reasonable good faith
considerations relating to the assignee's ability to perform PacifiCare's
financial obligations under this Agreement). The consent of a Party to any
assignment of this Agreement shall not constitute such Party's consent to
further assignment. This Agreement shall be binding on the Parties and their
respective successors and permitted assigns. Any assignment in contravention of
this Section 30.2(a) shall be void.

            (b) In the event that PacifiCare divests an entity or business unit
of PacifiCare, Supplier shall, for a period of up to two (2) years from the
effective date of such divestiture, at PacifiCare's request, continue to provide
the Services to such divested PacifiCare entity or business unit at the
applicable Fees then in effect. The applicable Fees attributable to that portion
of the Services of such divested PacifiCare entity or business unit shall be
paid to Supplier, at PacifiCare's discretion, by the successor entity owning or
controlling such divested entity or business unit and the same amount shall be
deducted for the Fees payable by PacifiCare to Supplier.

      30.3 BANKRUPTCY. The Parties acknowledge and agree that this Agreement
constitutes a license of an intellectual property right by Supplier to
PacifiCare Entities as such term is used in Section 365(n) of Title 11 of the
United States Code.

      30.4 CONFLICT OF INTEREST. Supplier shall not pay any salaries,
commissions, fees or make any payments or rebates to any employee of PacifiCare
Entities, or to any designee of such employee, or favor any employee of
PacifiCare Entities, or any designee of such employee, with gifts or
entertainment of significant cost or value or with services or goods sold at
less than full market value. Supplier agrees that its obligation to PacifiCare
Entities under this Section shall also be binding upon Supplier Agents. Supplier
further agrees to insert the provisions of this Section in each contract with a
Supplier Agent.

      30.5 CONSENTS, APPROVALS AND REQUESTS. Except as specifically set forth in
this Agreement, all consents and approvals to be given by either Party under
this Agreement shall not be unreasonably withheld or delayed and each Party
shall make only reasonable requests under this Agreement.

      30.6 CORPORATE INTEGRITY. Supplier acknowledges that PacifiCare operates
under a compliance program known as the "PACIFICARE ETHICS AND INTEGRITY
PROGRAM"). Supplier further acknowledges that, notwithstanding anything
contained herein, PacifiCare shall not be required to engage in any conduct that
may violate any policies, procedures or directives of the PacifiCare Ethics and
Integrity Program or its Medical Confidential Information Laws-related policies
and procedures. Supplier further represents that it neither has been, nor
currently is, excluded from participation in government funded healthcare
programs, including Medicare, Medicaid, CHAMPUS and FEHP.

      30.7 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one single agreement between the Parties.

                                      50.
<PAGE>

      30.8 COVENANT OF FURTHER ASSURANCES. PacifiCare and Supplier covenant and
agree that, subsequent to the execution and delivery of this Agreement and
without any additional consideration, each of PacifiCare and Supplier shall
execute and deliver any further legal instruments and perform any acts that are
or may become necessary to effectuate the purposes of this Agreement.

      30.9 ENTIRE AGREEMENT. This Agreement and the Schedules and Exhibits to
this Agreement represent the entire agreement between the Parties with respect
to its subject matter, and there are no other representations, understandings or
agreements between the Parties relative to such subject matter. Notwithstanding
the foregoing, neither Party shall be relieved of any of its respective
obligations with regard to information subject to any confidentiality agreement
entered into by the Parties prior to the Effective Date.

      30.10 EXPORT. Supplier shall not knowingly export or re-export any
personal computer system, part, technical data or sub-elements under this
Agreement, directly or indirectly, to any destinations prohibited by the United
States Government. The term "technical data" in this context, means such data as
is defined as technical data by applicable United States export regulations.

      30.11 GOOD FAITH AND FAIR DEALING. PacifiCare and Supplier acknowledge and
agree that all aspects of the business relationship and dealings between
PacifiCare and Supplier contemplated by this Agreement, including the
performance of all obligations and the exercise of all rights hereunder, shall
be governed by the fundamental principle of good faith and fair dealing.

      30.12 GOVERNING LAW AND VENUE. The rights and obligations of the parties
under this Agreement shall be governed in all respects by the laws of the State
of [...***...] exclusively, as such laws apply to contracts between [...***...]
residents performed entirely within [...***...]. Supplier agrees that it shall
only bring any action or proceeding arising from or relating to this Agreement
in a federal court in the [...***...] or in state court in [...***...], and
Supplier irrevocably submits to the personal jurisdiction and venue of any such
court in any such action or proceeding or in any action or proceeding brought in
such courts by PacifiCare.

      30.13 NOTICES. Except as otherwise specified in this Agreement, all
notices, requests, consents, approvals, agreements, authorizations,
acknowledgements, waivers and other communications required or permitted under
this Agreement shall be in writing. Wherever under this Agreement one Party is
required to give notice to the other, such notice shall be deemed effective: (a)
five (5) calendar days after deposit in the United States Mail, postage prepaid,
certified or registered mail, return receipt requested; (b) three (3) calendar
days after deposit with a national overnight courier; (c) if given by telex,
telegraph or facsimile, one (1) day after transmission, provided confirmation of
such notice is also sent by national overnight courier or delivered in person;
or (d) upon delivery if delivered in person or by messenger, in each case,
addressed to the following addresses (or such other address as either party may
be notified of as described above):

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                      51.
<PAGE>

      To PacifiCare:          Attention - Chief Information Officer
                              PacifiCare Health Systems, Inc.
                              3120 W. Lake Center Drive
                              Santa Ana, California  92704

      With a copy to:         Attention - Chief Financial Officer
                              PacifiCare Health Systems, Inc.
                              3120 W. Lake Center Drive
                              Santa Ana, California  92704-6917

                              Attention - Daniel R. Mummery
                              Cooley Godward LLP
                              Five Palo Alto Square, 3000 El Camino Real
                              Palo Alto, CA 94306

                              Attention - Scott J. Moore, Esq.
                              Konowiecki & Rank LLP
                              350 South Grand Avenue, Suite 2100
                              Los Angeles, CA  90071

      To Supplier:            Attention - Senior Vice President  & CFO
                              Keane, Inc.
                              Ten City Square
                              Boston, MA 02129

      With a copy to:         Attention - Managing Director
                              Keane, Inc.
                              300 Oceangate, Suite 300
                              Long Beach, CA 90802

      Either Party may change its address or telecopy number for notification
purposes by giving the other Party ten (10) days notice of the new address or
telecopy number and the date upon which it shall become effective.

      30.14 PUBLICITY. Each Party shall (a) submit to the other all advertising,
written sales promotions, press releases and other publicity matters relating to
this Agreement in which the other Party's name or mark is mentioned or that
contain language from which the connection of said name or mark may be inferred
or implied and (b) not publish or use such advertising, sales promotions, press
releases or publicity matters without the other Party's consent.

      30.15 RELATIONSHIP. The Parties intend to create an independent contractor
relationship and nothing contained in this Agreement shall be construed to make
either PacifiCare Entities or Supplier partners, joint venturers, principals,
agents (except as expressly set forth in Section 7) or employees of the other.
No officer, director, employee, agent, affiliate or contractor retained by
Supplier to perform work on PacifiCare Entities' behalf under this Agreement
shall be deemed to

                                      52.
<PAGE>

be an employee, agent or contractor of PacifiCare Entities. Neither Party shall
have any right, power or authority, express or implied, to bind the other.

      30.16 SEVERABILITY. If any provision of this Agreement is held by a court
of competent jurisdiction to be contrary to Law, then the remaining provisions
of this Agreement, if capable of substantial performance, shall remain in full
force and effect.

      30.17 SURVIVAL. The terms of Section 14, Section 15.1, Section 15.2,
Section 15.4, Section 17.1, Section 17.5, Section 17.6, Section 17.7, Section
17.10, Section 17.11, Section 17.12, Section 17.13, Section 18, Section 19.3,
Section 19.4, Section 19.5, Section 20, Section 21, Section 23, Section 25,
Section 26, Section 27, Section 28 and Section 30 shall survive the expiration
or termination of this Agreement.

      30.18 THIRD PARTY BENEFICIARIES. Each Party intends that this Agreement
shall not benefit, or create any right or cause of action in or on behalf of,
any person or entity other than the Parties and the PacifiCare Entities.

      30.19 CUMULATIVE REMEDIES. No right or remedy herein conferred upon or
reserved to either Party is intended to be exclusive of any other right or
remedy, and each and every right and remedy shall be cumulative and in addition
to any other right or remedy under this Agreement, or under applicable Law,
whether now or hereafter existing, provided, that through the exercise of its
rights and remedies under this Agreement, a Party shall not be entitled to any
financial recovery which is duplicative of any other financial recovery
hereunder.

      30.20 WAIVERS. No delay or omission by either Party to exercise any right
or power it has under this Agreement shall impair or be construed as a waiver of
such right or power. A waiver by any Party of any breach or covenant shall not
be construed to be a waiver of any succeeding breach or any other covenant. All
waivers must be signed by the Party waiving its rights.

                                      53.
<PAGE>

      IN WITNESS WHEREOF, each of PacifiCare and Supplier has caused this
Agreement to be executed and delivered by its duly authorized representative.

                       PACIFICARE HEALTH SYSTEMS, INC.

                       By:      /s/ Maria Fitzpatrick
                          ------------------------------------------------------
                       Name:    Maria Fitzpatrick
                       Title:   Senior Vice President/Chief Information Officer

                       By:      /s/ Bary Bailey
                          ------------------------------------------------------
                       Name:    Bary Bailey
                       Title:   Executive Vice President/Chief Strategic Officer

                       KEANE, INC.

                       By:      /s/ John Leahy
                          ------------------------------------------------------
                       Name:    John Leahy
                       Title:   Chief Financial Officer

<PAGE>

                                    EXHIBIT A

                                   DEFINITIONS

      "ADDITIONAL RESOURCE CHARGES" or "ARC" means the resource charges
specified in Schedule 17 for the use of Services above the resource baselines
set forth in Schedule 17.

      "AFFECTED CONTRACTORS" means those PacifiCare contractors identified in
Schedule 3.1(b)(i).

      "AFFECTED EMPLOYEES" means those PacifiCare employees identified in
Schedule 3.1(b)(ii).

      "AGREEMENT" means this Information Technology Services Agreement between
PacifiCare and Supplier, including all schedules and exhibits attached hereto.

      "ANNUAL PLAN" means the plan described in Section 3.8(a)(iii).

      "ASSIGNED AGREEMENTS" means the third party agreements that are assigned,
in whole or in part, to Supplier and that are set forth in Schedule 7.1.

      "BACK-END CONSENTS" means all third party licenses, approvals, permits,
consents and authorizations that are necessary to allow: (a) the PacifiCare
Entities and PacifiCare Entity Agents (i) to use the Supplier Third Party
Software and Supplier third party Tools, and (ii) to assign any contracts with
respect to third party services used by Supplier or Supplier Agents to provide
the Services to the extent requested by PacifiCare (and to the extent Supplier
is able to obtain such assignments using all reasonable efforts), in each case
for PacifiCare's use after the expiration or termination of this Agreement; and
(b) necessary for Supplier and Supplier Agents to assign to PacifiCare the
Developed Software and Work Product.

      "BACKGROUND TECHNOLOGY" of a Party means all algorithms, designs,
drawings, formula, know-how, protectable business methods, practices,
methodologies, inventions, software, materials, works of authorship, tools, and
other technology that (a) is owned by such Party and is in existence in
electronic or written form on or prior to the Effective Date or (b) is
developed, acquired or licensed by such Party after the Effective Date
excluding, as it relates to Supplier, Developed Software and Work Products.

      "BASE FEES" means the fees for the Base Services, as set forth in Schedule
17.

      "BASE SERVICE LEVELS" means the service levels and standards for the
performance of the Base Services as described in, or determined in accordance
with, Schedule 8.

      "BASE SERVICES" has the meaning set forth in Section 3.1.

      "BENCHMARKER" has the meaning specified in Section 9.2(a).

<PAGE>

      "BENCHMARKING PROCESS" means the objective measurement and comparison
process established by the Parties utilizing baselines and standards agreed upon
by PacifiCare and Supplier, which, in any case provides for a comparison of
Supplier's performance and pricing under this Agreement against competitive
providers providing services which are substantially similar in terms of scope,
volume, environment, geographic area, technologies in use (including skill
sets), contractual terms generally, and any other factors mutually agreed upon
by the Parties (e.g., agreed upon amortization of expenses and start-up costs
during the Term).

      "BUSINESS ASSOCIATE" has the meaning given in 45 C.F.R. 160.103.

      "CHANGE(S)" means any change to (a) the Services, (b) the Software used to
provide the Services or (c) the Equipment used to provide the Services, that
would materially alter the functionality, performance standards or technical
environment of the Software used to provide the Services or the Equipment used
to provide the Services, the provision of the Services, the Service Levels, the
composition of the Services, or the cost to PacifiCare of the Services.

      "CHANGE CONTROL PROCEDURES" has the meaning specified in Section 13.4.

      "CHANGE IN CONTROL" means any event or series of events that results
directly or indirectly in a change in the management or Control of a Party.
Without limiting the generality of the foregoing, each of the following shall be
considered a Change in Control: (a) the consolidation or merger of a Party with
or into any entity where the management of such Party is not in control of the
surviving entity; (b) the sale, transfer or other disposition of all or
substantially all of the assets of a Party; (c) any change in the beneficial
ownership of fifty percent (50%) or more (or such lesser percentage that
constitutes Control) of the outstanding voting securities or other ownership
interests of a Party; or (d) the resignation, removal appointment or election of
a majority of a Party's board of directors or management team within a six (6)
month period.

      "CONFIDENTIAL INFORMATION" of PacifiCare Entities or Supplier means all
information and documentation of PacifiCare Entities and Supplier, respectively,
whether disclosed to or accessed by PacifiCare Entities or Supplier in
connection with this Agreement, including (a) with respect to PacifiCare
Entities, all PacifiCare Data and all information of PacifiCare Entities or
their respective customers, suppliers, contractors and other third parties doing
business with PacifiCare Entities, (b) with respect to PacifiCare Entities all
IIHI, PHI and all other data and information of or relating to patients, (c)
with respect to PacifiCare Entities and Supplier, the terms of this Agreement
and (d) any information developed by reference to or use of PacifiCare Entities'
or Supplier's Confidential Information; provided, however, that except to the
extent otherwise provided by Law, the term "Confidential Information" shall not
include information that (w) is already known by the recipient at the time of
disclosure (other than through unauthorized disclosure), as demonstrated by the
recipient's written records, and the recipient has no obligation of
confidentiality other than pursuant to this Agreement or any confidentiality
agreements between PacifiCare Entities and Supplier entered into before the
Effective Date, (x) is independently developed by the recipient, as demonstrated
by the recipient's written records, without violating the disclosing Party's
proprietary rights, (y) is or becomes publicly known (other than through
unauthorized disclosure) or (z) is rightfully received by a Party free of any
obligation of confidentiality.

<PAGE>

      "CONSENTS" means Back-End Consents and Front-End Consents, collectively.

      "CONTRACT YEAR" means each twelve (12) month period commencing, in the
case of the first Contract Year, on the Cutover Date and thereafter upon the
completion of the immediately preceding Contract Year.

      "CONTROL" means, with respect to any entity, the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such entity, whether through the ownership of voting securities (or
other ownership interest), by contract or otherwise.

      "COVERED ENTITY" has the meaning given in 45 C.F.R. 160.103.

      "CRITICAL SERVICES" means those services described as Critical Services in
Schedule 16.1.

      "CUTOVER DATE" means [...***...]

      "DATA SAFEGUARDS" has the meaning set forth in Section 10.3.

      "DEFAULT CURE PERIOD" means the PacifiCare Default Cure Period or the
Supplier Default Cure Period, as applicable.

      "DEFAULT NOTICE" means the PacifiCare Default Notice or the Supplier
Default Notice, as applicable.

      "DEVELOPED SOFTWARE" means any Software, modifications or enhancements to
Software and Related Documentation developed pursuant or incident to this
Agreement by or on behalf of (a) Supplier, (b) Supplier Agents, (c) Supplier and
PacifiCare or PacifiCare Agents jointly, (d) Supplier Agents and PacifiCare
Entities or PacifiCare Entity Agents jointly or (e) Supplier, Supplier Agents,
PacifiCare and PacifiCare Entity Agents jointly.

      "DISASTER RECOVERY PLAN" or "DRP" means the disaster recovery plan
described in Section 16.1.

      "DISPUTE" has the meaning set forth in Section 23.1.

      "DOMESTIC ADC" has the meaning set forth in Section 3.8(a)(ii)(1).

      "EFFECTIVE DATE" means January 11, 2002.

      "END DATE" has the meaning set forth in Section 26.3.

      "END-USER" means a user of the Services, as specified by PacifiCare.

      "EQUIPMENT" means computers and related equipment, including central
processing units and other processors, controllers, moderns, communications and
telecommunications equipment (voice, data and video), cables, storage devices,
printers, terminals, other peripherals and input and output devices, and other
tangible mechanical and electronic equipment intended for the

                                               *CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

processing, input, output, storage, manipulation, communication, transmission
and retrieval of information and data.

      "EXTENSION PERIOD" has the meaning set forth in Section 2.2(b).

      "FEES" means the Base Fees, the Additional Resource Charges and any other
amounts payable by PacifiCare to Supplier pursuant to this Agreement.

      "FORCE MAJEURE EVENT" means a force majeure event as defined in Section
16.2.

      "FRONT-END CONSENTS" means all third party licenses, approvals, permits,
consents and authorizations that are necessary to allow: (i) Supplier and
Supplier Agents to use (1) PacifiCare Entities' owned and leased assets, (2) the
services provided for the benefit of PacifiCare Entities under PacifiCare's
third party services contracts (other than PacifiCare Third Party Contracts),
(3) the PacifiCare Software and PacifiCare Tools, (4) the Supplier Software and
Supplier Tools and (5) any assets owned or leased by Supplier and used to
provide the Services; (ii) PacifiCare to assign the Assigned Agreements to
Supplier pursuant to Section 7.1 and Supplier to manage and administer the
Managed Agreements pursuant to Section 7.2; (iii) Supplier and Supplier Agents
to use any third party services required by Supplier to provide the Services
during the Term and the Termination Assistance Period; and (iv) PacifiCare
Entities and PacifiCare Entity Agents to Use the Supplier Third Party Software
and Tools.

      "GOVERNMENTAL AUTHORITY" means any Federal, state, municipal, local,
territorial, or other governmental department, regulatory authority, judicial or
administrative body, whether domestic, foreign or international.

      "GOVERNMENTAL APPROVALS" means all PacifiCare Governmental Approvals and
Supplier Governmental Approvals.

      "HIPAA" means the Health Care Insurance Portability and Accountability Act
of 1996, as amended and as may be further amended, including all rules and
regulations promulgated thereunder.

      "INDIVIDUALLY IDENTIFIABLE HEALTH INFORMATION" or "IIHI" has the meaning
specified in Section 1171 of HIPAA.

      "IMPROVED TECHNOLOGY" has the meaning set forth in Section 3.2.

      "INDEMNIFIED PARTY" has the meaning set forth in Section 27.3.

      "INDEMNIFYING PARTY" has the meaning set forth in Section 27.3.

      "INFRASTRUCTURE AGREEMENT" means the agreement between PacifiCare and
Infrastructure Supplier that governs Infrastructure Supplier's provision of
information technology services to PacifiCare, and is dated as of December 31,
2001.

      "INFRASTRUCTURE SERVICES" the services provided by Infrastructure Supplier
pursuant to the Infrastructure Agreement.

<PAGE>

      "INFRASTRUCTURE SUPPLIER" means International Business Machines
Corporation, a New York corporation with its principal place of business at
Route 100, Somers, New York 10589.

      "INITIAL TERM" means the initial term of this Agreement, as set forth in
Section 2.1.

      "INITIAL TERM EXPIRATION DATE" has the meaning set forth in Section 2.1.

      "INTEREST" has the meaning set forth in Schedule 17.

      "KEY PERSONNEL" means the individuals and positions identified by
PacifiCare as Key Personnel in Schedule 12.2, as such schedule is updated from
time to time by the Parties , including the Supplier Client Relationship
Manager.

      "LAW" means any applicable law, statute or other legislative enactment,
declaration, decree, directive, order, ordinance, regulation, rule or other
binding restriction of or by any Governmental Authority, including any Medical
Confidential Information Laws.

      "LOSSES" means any and all damages, fines, penalties, deficiencies,
losses, liabilities (including settlements and judgments) and expenses
(including interest, court costs, reasonable fees and expenses of attorneys,
accountants and other experts and professionals or other reasonable fees and
expenses of litigation or other proceedings or of any claim, default or
assessment).

      "MANAGED AGREEMENT INVOICE(S)" means any invoice submitted by third
parties in connection with the Managed Agreements.

      "MANAGED AGREEMENTS" means all agreements to be retained by PacifiCare,
but managed by Supplier, including those listed in Schedule 7.2.

      "MEASUREMENT TOOL" means [...***...], or any additional or replacement
measurement tool implemented by Supplier pursuant to the Change Control
Procedures, used in connection with Supplier's provision of Services.

      "MEDICAL CONFIDENTIAL INFORMATION LAWS" means all Laws applicable to the
provision of healthcare services, including the HIPAA and all Laws governing
medical confidentiality, including disclosure of AIDS or human immunodeficiency
virus-related information.

      "NEAR-SHORE ADC" has the meaning set forth in Section 3.8(a)(ii)(1).

      "NEW SERVICES" means any service that is outside of the scope of the Base
Services.

      "NEW SERVICES SERVICE LEVELS" means the service levels and standards for
the performance of any New Services.

      "NEW SOFTWARE" means any Software obtained by Supplier on behalf of
PacifiCare, as requested by PacifiCare pursuant to Section 3.7.

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

      "NEW TAXES" means any sales, use, gross reciepts, excise, value-added,
services, consumption, withholding or other taxes assessed on the provision of
any of the Services by a taxing authority of competent jurisdiction on or after
the Cutover Date.

      "OFFSHORE ADC" has the meaning set forth in Section 3.8(a)(ii)(1).

      "OPERATIONAL AGREEMENT" means the agreement between Supplier and
Infrastructure Supplier as set forth in Section 13.2(a).

      "PACIFICARE AGENTS" means the agents, contractors and representatives of
PacifiCare, other than Supplier and Supplier Agents.

      "PACIFICARE COMPETITOR" means any competitor of PacifiCare Entities set
forth or described in Schedule 12.6(a).

      "PACIFICARE DATA" means (a) any data and information that is provided or
submitted to Supplier or Supplier Agents by or on behalf of PacifiCare Entities
or PacifiCare Entities' respective suppliers, clients or patients, (b) any data
and information that is obtained, generated, developed, collected, processed or
produced by Supplier or Supplier Agents in connection with this Agreement, (c)
any data and information to which Supplier or Supplier Agents have access in
connection with the provision of the Services and (d) any derivatives of
subsections (a)-(c) of this definition. PacifiCare Data includes reports,
service level data, patterns of service requirements and other data and
information with respect to the businesses, operations, facilities, suppliers,
clients, patients, products, services, assets and finances of PacifiCare
Entities, or their respective suppliers, clients or patients.

      "PACIFICARE DEFAULT CURE PERIOD" has the meaning set forth in Section
24.3.

      "PACIFICARE DEFAULT NOTICE" has the meaning set forth in Section 24.3.

      "PACIFICARE ENTITIES" means PacifiCare and the PacifiCare Included
Affiliates, collectively.

      "PACIFICARE ENTITY AGENTS" means agents, subcontractors and
representatives of PacifiCare Entities, other than Supplier and Supplier Agents.

      "PACIFICARE ESTIMATED BASELINE REQUIREMENTS" has the meaning set forth in
Section 3.9(a)(i).

      "PACIFICARE GOVERNMENTAL APPROVALS" has the meaning set forth in Section
3.3(a).

      "PACIFICARE INCLUDED AFFILIATES" means any person, firm, corporation,
partnership, associate, or other entity that agrees to be bound by the terms of
this Agreement and who (a) now or in the future is Controlling, Controlled by or
under common Control with PacifiCare, (b) is managed or operated by PacifiCare,
(c) is owned through stock ownership or membership interest, in whole or in
part, by a shareholder or member of PacifiCare or (d) is listed on EXHIBIT C as
the same may be updated from time to time by PacifiCare.

<PAGE>

      "PACIFICARE PROPRIETARY SOFTWARE" means the Software set forth in Schedule
14.2(a), and Related Documentation, that is owned, acquired or developed by
PacifiCare and used in connection with the provision of the Services.

      "PACIFICARE SERVICE LOCATION(S)" means any PacifiCare service location set
forth in Schedule 10.1 and any other service location owned or leased by
PacifiCare from which Supplier has been authorized by PacifiCare to provide the
Services.

      "PACIFICARE SOFTWARE" means the PacifiCare Proprietary Software and the
PacifiCare Third Party Software.

      "PACIFICARE SUPPLIER RELATIONSHIP MANAGER" has the meaning specified in
Section 6.1.

      "PACIFICARE THIRD PARTY CONTRACTS" means the Managed Agreements and the
Assigned Agreements, collectively.

      "PACIFICARE THIRD PARTY SOFTWARE" means the Software set forth in Schedule
14.2(b), and Related Documentation, that is licensed or leased to PacifiCare
from a third party and used in connection with the provision of the Services.

      "PARTIES" means PacifiCare and Supplier, collectively.

      "PARTY" means either PacifiCare or Supplier, as the case may be.

      "PRIVILEGED WORK PRODUCT" has the meaning set forth in Section 20.3.

      "POLICY & PROCEDURES MANUAL" means a listing of policies and procedures
that governs the delivery and receipt of the Services and that is based on the
outline set forth in Schedule 13.3.

      "PROJECT STAFF" means the personnel of Supplier, including Transitioned
Personnel, and Supplier Agents who provide the Services.

      "PROTECTED HEALTH INFORMATION" or "PHI" has the meaning given in 45 C.F.R.
164.501.

      "REDUCED RESOURCE CREDITS" or "RRC" means the credits in the amounts equal
to the Additional Resource Charges specified in Schedule 17 for the use of
Services below the resource baselines set forth in Schedule 17.

      "REGULATORY REQUIREMENTS" means the Laws to which PacifiCare Entities are
required to submit or voluntarily submit from time to time.

      "RELATED DOCUMENTATION" means, with respect to Software, Equipment, and
Tools, all materials, documentation, specifications, technical manuals, user
manuals, flow diagrams, file descriptions and other written information that
describes the function and use of such Software or Tools, as applicable.

      "SERVICE LEVEL CREDITS" means the performance credits set forth in
Schedule 8.

<PAGE>

      "SERVICE LEVELS" means the Base Service Levels and the New Services
Service Levels, collectively.

      "SERVICE LOCATION(S)" means any PacifiCare Service Location or Supplier
Service Location, as applicable.

      "SERVICES" means, collectively, the Base Services, the New Services being
provided by Supplier pursuant to this Agreement, and, during the Termination
Assistance Period, the Termination Assistance Services.

      "SOFTWARE" means the source code and object code versions of any
applications programs, operating system software, computer software languages,
utilities, other computer programs and Related Documentation, in whatever form
or media, including the tangible media upon which such applications programs,
operating system software, computer software languages, utilities, other
computer programs and Related Documentation are recorded or printed, together
with all corrections, improvements, updates and releases thereof.

      "STEERING COMMITTEE" has the meaning set forth in Section 13.1.

      "SUPPLIER ADC" means a Supplier application development center.

      "SUPPLIER AGENTS" means the agents, subcontractors and representatives of
Supplier.

      "SUPPLIER CLIENT RELATIONSHIP MANAGER" has the meaning specified in
Section 12.1.

      "SUPPLER COMPETITOR" means any competitor of Supplier set forth or
described in Schedule 12.6(b).

      "SUPPLIER DEFAULT CURE PERIOD" means the Supplier default cure period
defined in Section 24.3.

      "SUPPLIER DEFAULT NOTICE" means the means the Supplier default notice
defined in Section 24.4.

      "SUPPLIER GOVERNMENTAL APPROVALS" has the meaning set forth in Section
3.3(a).

      "SUPPLIER PROPRIETARY SOFTWARE" means the Software, including the Software
set forth in Schedule 14.3, and Related Documentation owned, acquired or
developed by or on behalf of Supplier, excluding in each case the Developed
Software, and used in connection with the Services or with any Supplier Software
or PacifiCare Software.

      "SUPPLIER'S REPLY" has the meaning specified in Section 3.8(a)(ii).

      "SUPPLIER SERVICE LOCATION(S)" means any Supplier service location set
forth in Schedule 10.1 and any other service location owned or leased by
Supplier from which Supplier has been authorized by PacifiCare to provide the
Services.

<PAGE>

      "SUPPLIER SOFTWARE" means the Supplier Proprietary Software and the
Supplier Third Party Software (excluding PacifiCare Software), collectively, of
which a current list is attached hereto as Schedule 14.3.

      "SUPPLIER THIRD PARTY SOFTWARE" means the Software and Related
Documentation licensed, leased or otherwise obtained by Supplier from a third
party that is used in connection with the Services or with any Supplier Software
or PacifiCare Software.

      "SYSTEMS" means the Software and the Equipment, collectively, used to
provide the Services.

      "TERM" means the Initial Term and, if applicable, any Renewal Term or
Extension Period.

      "TERMINATION ASSISTANCE PERIOD" has the meaning specified in Section
26.1(b).

      "TERMINATION ASSISTANCE SERVICES" has the meaning specified in Section
26.1(a).

      "TOOLS" means any Software development and performance testing tools, know
how, processes, technologies or algorithms and Related Documentation used by
Supplier in providing the Services.

      "TRANSITION PERIOD" has the meaning specified in Section 4.1.

      "TRANSITIONED PERSONNEL" has the meaning set forth in Section 11.

      "TRANSITION PLAN" means the transition plan set forth in Schedule 4.1.

      "TRANSITION SERVICES" has the meaning specified in Section 4.1.

      "USE" means the right-to-load, execute, store, transmit, display, copy,
maintain, modify, enhance, create derivative works, make and have made.

      "VARIABLE FEE REPORT" means the detailed invoice provided to PacifiCare by
Supplier on a monthly basis describing the Variable Fees incurred by PacifiCare
and Supplier during the preceding month.

      "VARIABLE FEES" means the Additional Resource Charges and the Reduced
Resource Credits, collectively.

      "WEB CONTENT" shall have the meaning specified in Section 14.6.

      "WORK PRODUCT" means any literary work or other work of authorship created
under this Agreement, including the Policy & Procedures Manual, other manuals,
application training materials and documentation, but excluding Software and
Related Documentation.

<PAGE>

                         TABLE OF EXHIBITS AND SCHEDULES

<TABLE>
<S>                     <C>
Exhibit A               Definitions
Exhibit B               Statement of Work
Exhibit C               PacifiCare Included Affiliates

Schedule 3.1(b)(i)      Affected Contractors
Schedule 3.1(b)(ii)     Affected Employees
Schedule 3.5            Technical Architecture Governance Document
Schedule 3.8(b)         Reports
Schedule 4.1            Transition Plan
Schedule 4.2            Critical Transition Milestones
Schedule 6.3(a)         Facilities Space Requirements and Rules & Regulations
Schedule 7.1            Assigned Agreements
Schedule 7.2            Managed Agreements
Schedule 8              Service Level Agreement
Schedule 9.2(a)         Approved Benchmark Providers
Schedule 10.1           Service Locations
Schedule 10.2           Safety and Security Procedures
Schedule 11             Human Resources Provisions
Schedule 12.2           Key Personnel
Schedule 12.4(e)        Approved Subcontractors for Keane
Schedule 12.6(a)        PacifiCare Competitors
Schedule 12.6(b)        Supplier Competitors
Schedule 13.2           Oversight and Management Process
Schedule 13.3           Policy & Procedures Manual
Schedule 14.2(a)        PacifiCare Proprietary Software
Schedule 14.2(b)        PacifiCare Third Party Software
Schedule 14.3           Supplier Software
Schedule 16.1           Critical Services
Schedule 17             Charges Schedule
Schedule 19.1           Form of Nondisclosure Agreement
Schedule 19.4           PacifiCare Records Retention Policies
Schedule 24.4           Failure to Provide Critical Services
</TABLE>

<PAGE>

PACIFICARE CONFIDENTIAL

                 SERVICES AGREEMENT BETWEEN PACIFICARE AND KEANE

                                    EXHIBIT B

--------------------------------------------------------------------------------
                                STATEMENT OF WORK
--------------------------------------------------------------------------------

                                   PACIFICARE(R)
                              INFORMATION SERVICES

<PAGE>

PACIFICARE CONFIDENTIAL

<TABLE>
<S>                                                                                                                <C>
I.       GENERAL PROVISIONS.....................................................................................    1

         A.       General.......................................................................................    1

         B.       Attachments...................................................................................    1

         C.       Definitions...................................................................................    1

         D.       Business Terms................................................................................    1

         E.       PacifiCare Resource Pool......................................................................    1

         F.       Account Approach..............................................................................    2

         G.       Scope of Services.............................................................................    2

         H.       Assumptions...................................................................................    2

II.      APPLICATIONS, PROJECT, APPLICATION MAINTENANCE AND CUSTOMER SUPPORT - SERVICE DESCRIPTIONS.............    4

         A.       Projects......................................................................................    4

         B.       Applications Maintenance......................................................................    4

                  1.       Correction...........................................................................    4

                  2.       Preventive Maintenance...............................................................    6

                  3.       Customer Support.....................................................................    6

                  4.       Other Services.......................................................................    6

                  5.       Infrastructure Support...............................................................    7

III.     SUPPLIER'S APPROACH TO PROJECT SERVICE REQUIREMENTS....................................................    8

         A.       General Services..............................................................................    8

         B.       Management of the Integration of Retained Systems with Outsourced Systems:....................    8

         C.       Development Services:.........................................................................    9

                  1.       Project, Customer Support and Application Maintenance Services.......................    9

                  2.       Database Services:...................................................................    9

                  3.       Development and Testing Environments:................................................   10

         D.       Oversight of Application Change Management:...................................................   10

         E.       Testing:......................................................................................   10

         F.       Software Quality Assurance Program:...........................................................   10

         G.       Release Management:...........................................................................   11

         H.       Production Control, Monitoring and Scheduling:................................................   12

         I.       Application Documentation:....................................................................   12

         J.       Training and Education:.......................................................................   12

         K.       Data Security:................................................................................   13

         L.       Retained Data:................................................................................   13
</TABLE>

<PAGE>

PACIFICARE CONFIDENTIAL

<TABLE>
<CAPTION>
<S>                                                                                                                <C>
         M.       Data Interfaces:..............................................................................   13

         N.       Logical Database Administration:..............................................................   13

         O.       Transition to Production:.....................................................................   14

         P.       Architecture and Standards:...................................................................   14

         Q.       Software Development Methodology, Tools and Practices:........................................   14

         R.       Problem Management:...........................................................................   14

         S.       Help Desk:....................................................................................   15

         T.       Project Management:...........................................................................   15

         U.       Capacity Planning and Configuration Management:...............................................   16

         V.       Application Response Time Measurement and Analysis............................................   16

         W.       Crisis Management:............................................................................   17

         X.       Continuity of Business Services:..............................................................   17

         Y.       License Management and Compliance:............................................................   18

         Z.       Asset Management:.............................................................................   18

         AA.      Systems Administration, Development Lab:......................................................   19

IV.      CROSS FUNCTIONAL SERVICES..............................................................................   20

         A.       New Technology and Automation:................................................................   20

         B.       Logical Security Administration:..............................................................   20

         C.       On-going Business Divestitures and Acquisitions:..............................................   23

         D.       Long-range Information Systems Plan and Equipment/Software Architecture:......................   23

V.       DEFINITION OF TERMS USED IN STATEMENT OF WORK:.........................................................   24

ATTACHMENT A  SUPPLIER WORK PRODUCT FUNCTIONAL DESCRIPTION MATRIX...............................................   27

ATTACHMENT B  SOFTWARE DEVELOPMENT METHODOLOGY ROLES AND RESPONSIBILITIES.......................................   30

ATTACHMENT C  PACIFICARE PRIORITIZATION AND GOVERNANCE AND SERVICE REQUEST PROCESSES............................   36
</TABLE>

<PAGE>

PACIFICARE CONFIDENTIAL

                                STATEMENT OF WORK

I.    GENERAL PROVISIONS:

A.    GENERAL:

      This Exhibit B to the Agreement, including all attachments hereto,
      ("STATEMENT OF WORK" or "SOW") describes specific Services, functions and
      responsibilities of Supplier in the areas of (a) Applications Maintenance,
      (b) Project, (c) Customer Support and (d) Cross Functional Services
      support for PacifiCare (the "PROJECT, CUSTOMER SUPPORT AND APPLICATION
      MAINTENANCE SERVICES"). For the purposes of this SOW, references to
      "PacifiCare" shall mean "PacifiCare Entities." Supplier shall provide the
      Services set forth in this Statement of Work as they may evolve during the
      Term and the Termination Assistance Period. In the event of any
      inconsistency, ambiguity or conflict, the terms and conditions of the
      Agreement shall govern unless specifically superseded in this Statement of
      Work.

B.    ATTACHMENTS:

      The following Attachments to this Statement of Work provide supporting
      details and are referenced in this Statement of Work:

      a.    Attachment A Supplier Work Product Functional Description Matrix;

      b.    Attachment B Software Development Methodology Roles and
            Responsibilities; and

      c.    Attachment C PacifiCare Prioritization and Governance and Service
            Request Processes.

C.    DEFINITIONS:

      Capitalized terms used herein shall have the meanings provided in the
      Agreement, and, for capitalized terms not defined in the Agreement, such
      capitalized terms shall have the applicable meanings set forth herein or
      in other schedules, exhibits or attachments to the Agreement, as
      applicable.

D.    BUSINESS TERMS:

      Beginning on the Cutover Date, Supplier shall provide the services
      described herein, including the FTPs defined in Schedule 17, as part of
      the Base Services. Attachment A to this Statement of Work contains
      additional details of PacifiCare and Supplier work responsibilities. All
      Supplier tasks described within this Statement of Work shall be included
      in the Resource Baseline set forth in Schedule 17 of the Agreement.

E.    PACIFICARE RESOURCE POOL:

      Supplier shall manage the Project Staff and any other staff responsible
      for the Services so that an individual's unavailability due to holidays,
      vacation or sick time shall not degrade Supplier's provision of the
      Services. Supplier shall prepare reports on the basis agreed upon by the
      Parties in the Policy and Procedures Manual and as otherwise provided in
      Schedule 3.8(b) or elsewhere in the Agreement detailing the work efforts
      by project or work activities with sufficient detail to identify the hours
      and activities directly associated with PacifiCare-related work. Supplier
      shall

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      require all personnel to track their respective daily time entries into
      the ABT tool (time keeping system) or an alternative method approved by
      PacifiCare.

F.    ACCOUNT APPROACH:

      Supplier shall provide the Services set forth in this Statement of Work
      through the implementation of several key disciplines, processes and
      organizational elements including:

            a.    Establishment of a project office to manage consistency of
                  project disciplines across the Applications and to establish,
                  implement and monitor project accountabilities using
                  Supplier's methodology (in alignment with PacifiCare's SDM
                  process as described in Attachment B of this Statement of
                  Work);

            b.    Resource allocation as necessary to support PacifiCare's
                  identified business objectives and as approved or directed by
                  PacifiCare;

            c.    Implementation of performance and quality management practices
                  as set forth by the Parties during the Transition Period in an
                  approach for providing reports to enable PacifiCare to confirm
                  that resources are appropriately concentrated on PacifiCare
                  initiatives;

            d.    Access to specialized skill sets to assist PacifiCare in
                  meeting its development needs; and

            e.    Provide for additional resources as requested by PacifiCare in
                  accordance with the Agreement and the terms described in
                  Schedule 17.

      To objectively monitor and measure the effective use of processes and
      deployment of resources in support of PacifiCare's identified business
      objectives, Supplier shall comply with Schedule 8 to the Agreement
      (Service Level Agreement).

G.    SCOPE OF SERVICES:

      Supplier shall provide support functions required for performing the
      Services, functions and responsibilities described in this Statement of
      Work and in the Agreement.

      The scope of Project, Customer Support and Application Maintenance
      Services is as follows:

            a.    Application Maintenance and support of the Applications;

            b.    Application Projects; and

            c.    Customer Support of the Applications.

H.    ASSUMPTIONS:

      Services shall be governed following PacifiCare's current processes and
      procedures, including PacifiCare's change management procedure, until such
      date as the Policy and Procedures Manual described in Section 13.3 of the
      Agreement is in effect, in which case the Services shall be governed by
      the processes and procedures described in the Policy and Procedures
      Manual.

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      Supplier shall deliver Services using Supplier's methodologies and
      procedures, called Suppliers Application Management Methodology (the
      "AMM").

      Supplier acknowledges that regardless of any tests or other procedures
      performed by PacifiCare or any other PacifiCare organization on the
      Applications, Supplier shall remain responsible for the performance of,
      and for correcting any errors in, such Applications (regardless of whether
      such performance issues or errors are discovered during such tests or
      other procedures) and for meeting all Service Levels as described in
      Schedule 8 to the Agreement.

      PacifiCare may retire, replace or add Applications throughout the Term and
      Termination Assistance Period.

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II.   APPLICATIONS, PROJECT, APPLICATION MAINTENANCE AND CUSTOMER SUPPORT -
      SERVICE DESCRIPTIONS:

A.    PROJECTS

      In order to implement, to develop and to enhance Applications as required
      and necessary to accommodate the evolution of PacifiCare's environments
      and business requirements, Supplier shall develop, test and introduce
      changes to the Applications that modify or add functionality to existing
      Applications and/or New Development ("PROJECT SERVICES"). Project Services
      shall be performed in accordance with the activities as set forth in the
      project requirements as set forth in Attachment A hereto. Project Services
      that require more than [...***...] of work to perform shall be performed
      as major projects ("MAJOR PROJECTS") and shall be performed according to
      the requirements for Major Projects as set forth in Attachment A. Project
      Services that require [...***...] of work or less to perform shall be
      performed as minor projects ("MINOR PROJECTS") and shall be performed
      according to the requirements for Minor Projects as set forth in
      Attachment A. All Project Services must be approved in accordance with the
      PacifiCare Prioritization and Governance and Service Request Processes.

      Supplier shall provide Project Services initiatives within the FTP
      authorized by PacifiCare through the PacifiCare Prioritization and
      Governance and Service Request Process and Supplier shall perform all
      Project Services according to the schedules established for individual
      projects in accordance with the PacifiCare Prioritization and Governance
      and Service Request Process.

      Supplier shall complete all Projects which are in progress as of the
      Cutover Date. Supplier shall complete these projects within the PacifiCare
      authorized FTPs and schedules. Supplier shall verify the FTP estimates and
      schedules associated with such projects during the Transition Period and
      report to PacifiCare any discrepancies. Such projects shall be measured
      from the Cutover Date. For Projects that are not on schedule as of the
      Cutover Date, Supplier and PacifiCare shall agree on new FTP estimates and
      schedules for such Projects.

      Supplier shall be responsible for End-User training on System Projects,
      modifications and new features to the Applications as described in the
      Training and Education section of this Statement of Work.

B.    APPLICATIONS MAINTENANCE:

      The Application Maintenance services to be provided by Supplier include
      [...***...]. Supplier shall have the discretion to utilize the portion of
      the budget allocated for Application Maintenance to perform the
      Application Maintenance services.

      1.    CORRECTION:

            Correction of production errors requires timely repair of
            Application code and operational modifications. Production errors
            include Severity Level 0, 1, 2 and 3 production problems that result
            in Application failures or non-conformance to the Application
            specifications. Application Maintenance requests are approved in
            accordance with current PacifiCare procedures until such date as
            such provisions are incorporated into the Policy and Procedures
            Manual.

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            For purposes of this Statement of Work, "ERROR CORRECTION" means the
            correction of any failure or error that results in non-conformance
            of an Application with applicable written baseline specifications.

            Supplier shall be responsible for resolution of all Application
            Maintenance problems that require either code or operational
            modifications (or both) as a result of Error Correction.

            With respect to PacifiCare Third Party Software, Supplier shall:

            a.    Identify Application problems;

            b.    Notify the applicable vendor;

            c.    Arrange for corrections to be made;

            d.    Coordinate the corrections;

            e.    Test the corrections - including the End-User acceptance test,
                  as necessary;

            f.    Schedule the installation of the corrections into production;
                  and

            g.    Submit the change to production.

            Supplier shall report Application problems in accordance with
            PacifiCare's problem management process for each Application, until
            such time as these procedures are set forth in the Policy and
            Procedures Manual.

            Supplier shall manage, resolve and escalate, as required, reported
            problems for the Applications.

            [...***...]

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      2.    PREVENTIVE MAINTENANCE:

            Supplier shall provide preventive Application Maintenance services,
            including monitoring production processing and results, application
            tuning, code restructuring and other efforts usually undertaken to
            improve the efficiency and reliability of Software ("PREVENTIVE
            MAINTENANCE").

            Supplier shall recommend for PacifiCare's approval any Preventive
            Maintenance that exceeds the Preventative Maintenance that can be
            accomplished within the portion of the budget allocated for
            Application Maintenance. Such Preventive Maintenance support efforts
            are subject to the PacifiCare Prioritization and Governance and
            Service Request Processes.

            Preventive Maintenance is performed to improve the efficiency and
            reliability of the Application and to help minimize ongoing
            Application Maintenance requirements, improve performance and
            prevent errors. Supplier shall monitor and analyze trends to
            identify potential problems and implement Preventative Maintenance
            to avoid and minimize such problems. PacifiCare may request
            Preventive Maintenance. [...***...] Supplier and Infrastructure
            Supplier shall evaluate and report the impact in terms of ARCs and
            RRCs to PacifiCare.

      3.    CUSTOMER SUPPORT

            Supplier shall provide Customer Support for End-Users.

            Requests for Customer Support may be initiated from the End-User
            community or special business requests.

            Supplier shall provide support, advice and assistance to End-Users
            in a manner consistent with PacifiCare practices prior to the
            Cutover Date. In addition, Supplier shall address requests that
            require immediate action, including [...***...] in accordance with
            the Change Management Procedures.

      4.    OTHER SERVICES

            Supplier shall:

            [...***...]

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            [...***...]

      5.    INFRASTRUCTURE SUPPORT

            All Equipment and Software conversions or refreshes or
            technology-mandated changes to support existing Services are
            categorized as Project Services. Supplier shall maintain a current
            Application environment in accordance with this Statement of Work.
            Supplier shall assess the need for upgrades to PacifiCare Third
            Party Software to maintain such Software within one (1) generation
            of currency and shall provide such assessment to PacifiCare for
            PacifiCare's approval. Supplier shall maintain all PacifiCare Third
            Party Software upgrades approved by PacifiCare. Certain Application
            changes shall require expedited implementation; for example, changes
            to include new clinical codes mandated by a regulatory change must
            be implemented as quickly as possible following the update by the
            regulatory body. These changes shall be identified, pre-approved by
            PacifiCare and documented in the Policy and Procedures Manual.
            Supplier shall perform all Application modification including test
            plan development, testing and Acceptance Testing needed to maintain
            this degree of currency. In conformance to the applicable Project
            plan and test plan, End-Users shall approve the Application testing,
            as necessary, to ensure that End-User functionality is maintained.
            Infrastructure support efforts are subject to the PacifiCare
            Prioritization and Governance and Service Request Processes.

            Prior to the start of each calendar quarter, Supplier shall provide
            to PacifiCare all planned Software for the upcoming quarter.
            Supplier shall fully test any new release of System Software before
            installing it for production use. Supplier shall coordinate with
            Infrastructure Supplier to fully test operating Systems Software for
            PacifiCare and perform coordination in accordance with the Change
            Management Procedure and the Test Plan (described in Schedule 13.3)
            for each Software modification.

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III.  SUPPLIER'S APPROACH TO PROJECT SERVICE REQUIREMENTS

A.    GENERAL SERVICES:

      Supplier shall identify opportunities to provide cost-effective support
      (including Application Maintenance, Customer Support and Project support)
      for the Applications.

      Supplier shall assist PacifiCare in developing high-level and long-range
      architecture migration plans for existing Applications and for any new
      and/or future Applications that may be added to Supplier's scope as New
      Services.

      Supplier representatives shall meet with representatives of PacifiCare as
      necessary and appropriate to manage and deliver the Services effectively.
      Supplier shall support and participate in the various account management
      committees called for by the Agreement and the procedures adopted by the
      Parties to charter each such committee. Supplier shall participate in
      related PacifiCare business and technology planning meetings upon request
      to review operations and business plans and recommend appropriate
      information technology services to support plan execution.

      Supplier shall maintain appropriate levels of industry knowledge in
      PacifiCare's business through, among other activities, participation in
      industry meetings, forums and conferences.

B.    MANAGEMENT OF THE INTEGRATION OF RETAINED SYSTEMS WITH OUTSOURCED SYSTEMS:

      Supplier shall provide appropriately skilled resources to support
      PacifiCare's business planning and strategic planning process, based upon
      PacifiCare's identified business requirements.

      Supplier shall provide resources to support integrated projects for
      PacifiCare retained Applications as directed and scheduled by PacifiCare
      for:

      [...***...]

      Supplier shall follow identified PacifiCare guidelines, where they exist
      within the Applications, for program turnover and acceptance.

      Supplier shall implement standard project reviews for all Projects as
      defined within each of the Applications' project plans and in accordance
      with Supplier's standards.

      Supplier shall recommend, with PacifiCare's approval, relevant technical
      architecture that is in compliance with PacifiCare's technical
      architecture.

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      Supplier shall provide access to performance data, project management
      information, project plans and status, cost estimates and information and
      service level performance in accordance with Service Levels specified in
      Schedule 8 of the Agreement.

C.    DEVELOPMENT SERVICES:

      1.    PROJECT, CUSTOMER SUPPORT AND APPLICATION MAINTENANCE SERVICES

            Supplier shall be responsible for performing services that support
            the functions and services performed as part of the Project,
            Customer Support and Application Maintenance Services, which support
            shall increase the efficiency and productivity of the Project,
            Customer Support and Application Maintenance Services and provide a
            single control point for the Project, Customer Support and
            Application Maintenance Services to insure that common standards and
            methodologies for Project, Customer Support and Application
            Maintenance Services are addressed and followed by personnel
            performing the Project, Customer Support and Application Maintenance
            Services ("DEVELOPMENT SERVICES"). Supplier's responsibilities with
            respect to Development Services shall include the following:

            a.    Administering the development and test environments for the
                  Project, Customer Support and Application Maintenance
                  Services, including administering and controlling access to
                  the development and test environment; and

            b.    Managing the development environment and Systems in
                  conjunction with the Infrastructure Supplier to ensure
                  efficient use, including ensuring that appropriate versions of
                  Software and code are being used, that the Systems are
                  available for use and providing first-level trouble shooting
                  for any problems with the Systems with respect to use for
                  Project, Customer Support and Application Maintenance
                  Services.

      2.    DATABASE SERVICES:

            With respect to Supplier's database setup and Application
            Maintenance functions, Supplier's responsibilities shall include the
            following:

            [...***...]

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            [...***...]

      3.    DEVELOPMENT AND TESTING ENVIRONMENTS:

            With respect to establishing development/testing environments,
            Supplier's responsibilities shall include the following:

            a.    Determine the requirements for the development/testing
                  environment;

            b.    Build and establish test environments in conjunction with the
                  Infrastructure Supplier; and

            c.    Administer the restoration of database required files required
                  to support the development/testing environment.

D.    OVERSIGHT OF APPLICATION CHANGE MANAGEMENT:

      Provide oversight for change management for Project, Customer Support and
      Application Maintenance Services (as set forth in the Change Management
      Procedure portion of the Policy and Procedures Manual) and report to
      PacifiCare on compliance with the Change Management Procedures.

      Supplier shall coordinate the transfer of all changes into the production
      environment to achieve continuity of operations, including risk
      assessment, communication of all scheduled changes to PacifiCare and the
      Infrastructure Supplier, back-out plans and contingencies.

      Supplier shall participate in the existing change management meetings with
      representatives of PacifiCare to identify impacts of and to coordinate
      changes to the Systems. Where the forums do not exist, Supplier shall
      conduct regular change management meetings with representatives of
      PacifiCare to identify the impacts of and to coordinate changes to the
      Systems.

E.    TESTING:

      Supplier shall provide testing including unit, System, integration,
      performance, load, stress and regression testing, as required by the
      Project plan, and, as appropriate, to the scale of the PacifiCare
      authorized work as determined by the PacifiCare Prioritization and
      Governance and Service Request Process. Test plans shall document test
      cases and expected results. This phase shall include testing of input and
      output interfaces. All Applications shall be production ready upon
      completion of the System test plan.

      End-User acceptance test results shall be used by Supplier to validate
      project deliverables. Software comprising the Applications shall be
      production quality at the conclusion of the End-User acceptance test.

F.    SOFTWARE QUALITY ASSURANCE PROGRAM:

      Supplier and PacifiCare shall establish a quality assurance program to
      apply to the Application Maintenance, Projects, management activities and
      products at a level consistent with best industry standards and practices.
      Supplier shall continuously improve the products and processes. In this

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      regard, Supplier shall use process maturity and process assessment
      concepts at CMM Level 3 within the timeframe established by the Service
      Level Schedule to the Agreement.

      As part of the quality assurance program, Supplier shall implement a
      delivery assurance process that includes reviews at key milestones,
      including design completion and code completion. Supplier shall ensure
      compliance with Supplier's established quality assurance procedures
      through such methods as quality audits.

G.    RELEASE MANAGEMENT:

      Supplier shall support PacifiCare's process for priority setting, planning
      and scheduling of Application releases. Supplier shall assume full
      responsibility for release packaging and project commitments for the
      Applications. Supplier shall support the feasibility sub-processes of
      concept proposal and definition.

      When implementing changes, upgrades or Projects to the Application
      environment, Supplier shall observe the Change Management Procedure and
      shall perform installation planning, product installation, testing and
      verification. In addition, for any Software changes, upgrades or Projects
      proposed to PacifiCare, Supplier shall advise PacifiCare and
      Infrastructure Supplier of any additional Equipment, LAN or environmental
      requirements, which are observed during integration testing and/or are
      otherwise known to be necessary for implementation of the changes,
      upgrades or Projects.

      Supplier shall provide the necessary interfaces during the development
      testing and implementation phases.

      Supplier shall monitor the release schedule and report all schedule
      exceptions to PacifiCare.

      Supplier shall coordinate the transfer of all changes into the production
      environment to ensure continuity of operations, including risk assessment,
      communication of all scheduled changes to PacifiCare and Infrastructure
      Supplier, back-out plans and contingencies.

      As requested by PacifiCare, Supplier shall support, in conjunction with
      the Infrastructure Supplier, the installation of department or End-User
      specific Software in accordance with the Change Management Procedures.
      Supplier shall report to PacifiCare the installation of such Software on a
      monthly basis.

      Should Supplier be made aware of problems that have not been corrected in
      the Software release, or if Supplier has reason to believe that the
      Software release could adversely affect PacifiCare's or Supplier's ability
      to meet Service Level targets, Supplier shall notify PacifiCare of the
      concern and work with PacifiCare to provide an appropriate course of
      action, regardless of whether it fell within the window of installation as
      requested. This shall also include problems that are encountered during
      System and integration testing.

      Prior to the start of each calendar quarter, Supplier shall provide to
      PacifiCare all planned releases for the upcoming quarter. Supplier shall
      fully test any new release of System Software before installing it for
      production use.

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H.    PRODUCTION CONTROL, MONITORING AND SCHEDULING:

      Supplier has responsibility for the integrity of the production output to
      include quality output and appropriate data results.

      Supplier shall coordinate with Infrastructure Supplier to define and
      support production schedules based on PacifiCare's requirements. Supplier
      shall use the existing PacifiCare production scheduling procedures until
      such time as Supplier's procedures are in place.

      Supplier shall coordinate with Infrastructure Supplier to determine and
      support specific production schedules within the context of PacifiCare
      approved release. Supplier shall support the integration of these specific
      release schedules into the data center and distributed computing
      production and control scheduling functions.

      Supplier shall create and maintain a list of jobs to be monitored and a
      list of PacifiCare contact names and phone numbers for each job, defining
      the conditions under which Supplier shall notify PacifiCare and document
      actions to be taken in the event an abnormal condition arises. This
      includes the development and Application Maintenance of
      application-automated tools.

      Supplier shall review production control reports, indicators and complete
      data integrity checks to ensure expected results. Supplier shall perform
      escalation procedures for the Applications to ensure resolution of
      production problems as required by the Severity Levels.

I.    APPLICATION DOCUMENTATION:

      Supplier shall maintain Application related procedures and Related
      Documentation unless it is agreed by the Parties not to do so. All
      Applications produced by Supplier shall be documented in form and content
      and consistent with that required by the CMM Level 3 practices.

      Supplier shall provide business analysts to develop and document business
      requirements for PacifiCare and its business units as budgeted and
      required by PacifiCare.

      Supplier shall produce System requirements and detailed design for each
      New Development or Project as required by the current PacifiCare
      development process.

      Supplier shall develop and maintain all Related Documentation and
      reference manuals for the Applications.

      Supplier shall provide documentation of database administration
      requirements and data definition as required.

      During the Transition Period, Supplier shall review the results of the
      Related Documentation assessment with PacifiCare and Supplier shall update
      the Related Documentation based on the approved results of the assessment.

J.    TRAINING AND EDUCATION:

      Without limiting or altering any of Supplier's obligations set forth in
      the Agreement, Supplier shall:

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[...***...]

K.    DATA SECURITY:

      In accordance with Section 10.2 of the Agreement, Supplier shall comply
      with PacifiCare's Safety and Security Procedures. Supplier shall
      demonstrate compliance with Information Security policies, procedures and
      standards where applicable. Supplier shall monitor these policies and keep
      PacifiCare informed of any recommended improvements in industry standards
      or in PacifiCare's internal policies.

      Supplier shall continuously review and refine data retention policies and
      practices to allow for compliance with external regulatory requirements
      identified by PacifiCare and PacifiCare data retention policies as
      approved by PacifiCare.

L.    RETAINED DATA:

      For any data, including PacifiCare Data, that shall be retained as
      required by law, by the order of a court or similar judicial or
      administrative body, pursuant to a settlement agreement, finding of a
      court, arbitrator or mediator, in preparation for or use in a matter
      relating to litigation or upon the request of PacifiCare, Supplier shall
      identify the Application that processes the relevant data and the relevant
      output files for the data and shall increase the retention period for such
      output files to comply with the applicable retention requirement.

M.    DATA INTERFACES:

      Supplier shall manage any changes to Application interfaces, data
      definition or content affecting out-of-scope PacifiCare Systems. These
      changes shall be approved by PacifiCare in accordance with the PacifiCare
      Prioritization and Governance and Service Request Process prior to
      implementation.

      Supplier shall maintain and update Application data interfaces unless
      PacifiCare agrees that an interface may be removed. Changes or additions
      to interfaces that are initiated by parties other than Supplier shall be
      prioritized and approved by PacifiCare in accordance with the Change
      Management Procedures.

N.    LOGICAL DATABASE ADMINISTRATION:

      Supplier shall perform logical database administration ("DATABASE
      ADMINISTRATION" or "DBA") for the Applications, including documentation
      requirements, data definition data administration and metadata management.
      Supplier shall maintain the data dictionary System, assist in design
      considerations, periodically review the database activity in conjunction
      with the Infrastructure

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      [...***...]

O.    TRANSITION TO PRODUCTION:

      In conjunction with the Infrastructure Supplier and following the Change
      Management Procedures, Supplier shall support implementation and
      installation of the appropriate technical, environment and data
      requirements to ensure a smooth migration of the new/enhanced System to
      production and to provide a basis for project closure. This includes
      supporting the migration of Application changes to production, including
      setting up production processes in the scheduler tools, converting code to
      production and monitoring production processes for the first month.
      Supplier shall provide operations documentation to the Infrastructure
      Supplier, perform final training and perform database and file conversions
      as necessary.

P.    ARCHITECTURE AND STANDARDS:

      Supplier's deliverables shall conform to the current PacifiCare Technical
      Architecture and Product Standards Procedures set forth in Schedule 3.5 of
      the Agreement and as set forth in the Agreement. Supplier may request
      exceptions as set forth in PacifiCare's defined process and PacifiCare may
      or may not grant such requests for exceptions.

Q.    SOFTWARE DEVELOPMENT METHODOLOGY, TOOLS AND PRACTICES:

      Supplier shall implement Supplier's preferred methodology. Supplier shall
      provide linkage to PacifiCare processes and provide for walk-through
      reviews of changes and Projects as required by the Change Management
      Procedures.

R.    PROBLEM MANAGEMENT:

      Supplier shall support existing PacifiCare problem management processes
      until such time as the Policy and Procedures Manual is completed. Supplier
      shall escalate problems and coordinate support groups as needed until
      problems are resolved for the Applications.

      Supplier shall implement, in collaboration with the Infrastructure
      Supplier, a process for problem identification and management. The process
      shall include:

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            a.    Key process metrics for establishing problem ownership, root
                  cause analysis, resolution and corrective action; and

            b.    Notification, escalation and closure-reporting procedures.

      Supplier shall identify preventive measures and corrective actions and
      conduct appropriate risk assessments in order to resolve problems for the
      Applications.

S.    HELP DESK:

      Infrastructure Supplier's help desk solution for PacifiCare results in a
      single-point-of-contact (SPOC) for all End-User Service Requests.
      End-Users shall submit Service Requests to the Help Desk including by
      placing a call to the Infrastructure Supplier-provided 1-800 number (for
      non-international calls), by submitting a Service Request ticket via
      Infrastructure Supplier's Web-based tool interface into the help desk or
      by submitting an e-mail if the primary avenues are unavailable.

      Supplier shall provide resources required to provide Application support
      and assistance to the Infrastructure Supplier and End-Users in a manner
      consistent with current practices, including providing the training and
      Related Documentation to the Infrastructure Supplier necessary for the
      Infrastructure Supplier to provide Level 1 Help Desk support. Supplier
      shall provide Level 2 Help Desk support for The Applications. Both Level 1
      Help Desk support and Level 2 Help Desk support collectively and
      individually, as applicable, shall be referred to as "HELP DESK SUPPORT."

      Supplier shall provide clearly defined points of contact, available
      24-hours-a-day, seven-days-a-week, to receive and appropriately respond to
      Service Request notifications from the Infrastructure Supplier Help Desk.

      Supplier shall inform the Infrastructure Supplier or applicable PacifiCare
      party, of the estimated time Supplier requires to resolve the Service
      Request at the time Supplier is notified thereof based on guidelines
      within the applicable production Severity Level.

      Supplier shall provide status updates during Service Request resolution as
      defined, with the existing escalation procedures.

T.    PROJECT MANAGEMENT:

      Supplier shall perform project management functions, including planning,
      organizing, monitoring and controlling of Software resources,
      functionality and quality of project activities for all Applications.

      Supplier shall coordinate with appropriate PacifiCare personnel or third
      party vendors as needed to perform project management functions and
      responsibilities. Supplier shall facilitate communication and coordination
      among parties relative to the Services.

      Supplier shall provide appropriately skilled resources to participate in
      the resolution of issues that cross Systems and between retained
      application Software and the Applications.

      Supplier shall establish detailed project plans as appropriate based upon
      the Policy and Procedures Manual and Supplier's AMM processes, which
      include: project scope, Equipment, Software and network selections,
      project acceptance criteria, project risk, constraints and

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      migration plan, implementation and migration plans, project plan (with
      dates, milestones, resources), description of deliverables, development,
      support and Application Maintenance costs and developing and/or assisting
      PacifiCare in developing business benefits and ROI.

      Supplier shall provide project control information, including time
      tracking, issue tracking, Change Management Procedures and status as
      defined in the Policy and Procedures Manual.

      Supplier shall be responsible for the support and maintenance of the time
      accounting Software [...***...].

      Supplier shall provide adhoc reporting on an as needed basis, but at a
      minimum shall provide [...***...] of effort per year. PacifiCare shall
      retain ownership of the data and shall have access to it.

      PacifiCare shall be responsible for the licensing of the time accounting
      application Software.

U.    CAPACITY PLANNING AND CONFIGURATION MANAGEMENT:

      Supplier shall support Infrastructure Supplier with capacity planning and
      configuration management.

      Supplier shall identify to PacifiCare opportunities for collaboration with
      the Infrastructure Supplier to help maximize capacity utilization and
      configuration management.

      [...***...]

V.    APPLICATION RESPONSE TIME MEASUREMENT AND ANALYSIS

      Supplier shall support Infrastructure Supplier with Application response
      time measurement and analysis.

      Supplier shall identify to PacifiCare opportunities for collaboration with
      the Infrastructure Supplier to help improve response time.

      In conjunction with the Infrastructure Supplier, Supplier shall:

            [...***...]

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            [...***...]

W.    CRISIS MANAGEMENT:

      Supplier shall provide increased support to address any crisis or
      emergency problem as approved by and funded by PacifiCare.

      Supplier understands that emergency support includes those things
      reasonably critical to End-Users or to provide critical support to the
      Infrastructure Supplier or to PacifiCare's information technology
      organization to comply with immediate and critical business directives of
      PacifiCare senior management.

X.    CONTINUITY OF BUSINESS SERVICES:

      Supplier shall assist in maintaining and upgrading existing PacifiCare
      procedures to support disaster recovery of the Applications and shall
      perform Disaster Recovery testing as stated in the Agreement, section 16.1
      and in Schedule 8. Other specific Supplier responsibilities include:

      Continuously review and refine retention policies and practices to comply
      with outside regulators' changes as provided to Supplier by PacifiCare in
      accordance with Section 3.3(b) of the Agreement;

      Identifying Equipment inventory, which simulates the production
      environment in support of the Applications and providing required data to
      secure capital budget for updated recovery site configuration; and

      Provide operational and technical management support for Disaster Recovery
      planning, testing and execution in crisis situations. Supplier is
      responsible for training personnel in Disaster Recovery procedures and
      providing access to these procedures in a crisis situation. Supplier shall
      also be responsible for making sure all contingency policies and
      procedures comply with PacifiCare standards and are current with no
      exceptions. Other Supplier responsibilities include:

            Identifying and training resources required to implement the
            Disaster Recovery Plan upon the occurrence of a disaster;

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            Develop and maintain Application recovery plans;

            Assisting in the set-up and performance of Application recovery
            testing as required for compliance with the Disaster Recovery Plan
            and the Business Continuity Plan;

            Perform Disaster Recovery testing as stated in the Agreement,
            section 16.1 and in Schedule 8. Supplier shall also be responsible
            to conduct testing of those plans and shall retest within ninety
            (90) days if any disaster simulation(s) fail to achieve specified
            results due to Supplier's failure to perform its responsibilities.
            If the DRP testing encounters errors, Supplier shall develop
            procedures and retest as necessary to resolve such errors and update
            the DRP as necessary;

            Report and review with PacifiCare disaster test results;

            Maintain Disaster Recovery procedures manuals;

            Implement the Disaster Recovery Plan upon the occurrence of a
            disaster; and

            In conjunction with the Infrastructure Supplier, identify single
            points of failure.

Y.    LICENSE MANAGEMENT AND COMPLIANCE:

      Supplier shall monitor, audit and advise PacifiCare concerning Software
      license compliance. Supplier is responsible for providing Software for
      Supplier-provided Applications development tools. Supplier shall be
      responsible to acquire the correct number of the foregoing licenses to be
      compliant. PacifiCare shall be responsible to acquire the appropriate
      number of Software licenses used for Applications and for third-party
      End-User tools. Supplier shall advise PacifiCare of the number of users
      that Supplier has become aware are using the licenses for which PacifiCare
      is responsible and Supplier shall notify PacifiCare if such number exceeds
      the number of users as provided by PacifiCare. When Supplier becomes aware
      of the presence of unauthorized Software, Supplier shall promptly notify
      PacifiCare.

            Supplier shall:

                  Provide periodic reporting of such license information to
                  PacifiCare, as required;

                  File and track Software license agreements;

                  Ensure compliance with Software licenses;

                  Proactively scan for pirated Software;

                  Proactively forecast Software license requirements; and

                  Report Software license anomalies.

Z.    ASSET MANAGEMENT:

      Supplier shall assist Infrastructure Supplier in tracking inventory of
      in-scope assets, Equipment, Software and Services in accordance with
      Schedules 3.8(a), 7.1, 7.2, 14.2(a), 14.2(b) and 14.3 of the Agreement.
      Supplier shall track and report Third Party Software inventory to include
      seat accountability.

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      Supplier inventory tracking service shall meet PacifiCare's requirements
      for Software asset tracking and inventory tracking services. Tracking and
      making optimal use of the Software inventory is central to the effective
      management of any computing environment. Supplier shall deliver the degree
      of accuracy necessary for sound business decision-making.

AA.   SYSTEMS ADMINISTRATION, DEVELOPMENT LAB:

      Infrastructure Supplier shall create a general-purpose development lab for
      PacifiCare's use. Prior to the time that such development lab is available
      for use, the intended utilization and the procedures governing the
      utilization of such lab shall be proposed by Supplier and agreed upon by
      the Parties in conjunction with the Infrastructure Supplier. Prior to the
      time that such lab is available for use and on an ongoing basis, Supplier
      shall propose to PacifiCare the extent to which approved Projects can
      benefit from the use of such lab as part of the Base Services.

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IV.   CROSS FUNCTIONAL SERVICES

A.    NEW TECHNOLOGY AND AUTOMATION:

      Working with the retained PacifiCare staff, Supplier shall support new
      application technology and automation, including emerging Equipment,
      Software, methodologies, techniques and various platforms. Services shall
      include investigation, evaluation, selection, training, implementation and
      consulting on new technology and automation of manual tasks. Supplier's
      responsibilities for new technology and automation shall include the
      following:

      -     Support PacifiCare in the management and representation of
            technology product and service offerings to its internal clients.
            Supplier shall work with PacifiCare as required to identify new
            products and services that reflect evolving technology and/or client
            demands;

      -     Facilitate and encourage active cross-functional, cross-group and
            cross-location coordination and communication. This working practice
            shall be a key element in most functions and processes, but
            especially Problem Management, Change Management and Project
            Management;

      -     Provide, on the schedule specified by PacifiCare in support of
            PacifiCare's annual budget development cycle, the input, assistance,
            comment and review support for preparation of the long-range
            Information Systems Plan and Equipment/Software Architecture Plan or
            as otherwise requested by PacifiCare;

      -     Participate, from time to time, in evaluations involving other third
            party suppliers;

      -     Evaluate new third party products and provide, upon PacifiCare's
            request, any reports, summaries or results of such evaluation and
            testing;

      -     Define requirements for automation;

      -     Automate manual monitoring functions;

      -     Automate Application alerts to System operators; and

      -     Research tools to improve Service Levels or performance of operating
            environments.

B.    LOGICAL SECURITY ADMINISTRATION:

      Supplier shall adhere and demonstrate compliance to an information
      security approach which protects PacifiCare information as prescribed by
      its data owners and complies with (1) all established PacifiCare security
      policies and standards and (2) applicable federal and state regulatory
      requirements. Supplier shall conduct [...***...] scheduled reviews of the
      Systems development methodology to ensure adequacy and effectiveness of
      security and control touch points with the reports to be reported to
      PacifiCare security personnel. Supplier shall:

            [...***...]

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                                  [...***...]

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                                   [...***...]

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                                   [...***...]

C.    ON-GOING BUSINESS DIVESTITURES AND ACQUISITIONS:

      Supplier shall support PacifiCare Included Affiliates per Exhibit C to the
      Agreement in accordance with the Agreement. Supplier shall provide
      services to additional business units in accordance with the Agreement.

D.    LONG-RANGE INFORMATION SYSTEMS PLAN AND EQUIPMENT/SOFTWARE ARCHITECTURE:

      PacifiCare internal staff shall be responsible for the development of and
      annual updates to a long-range information systems plan and
      equipment/software architecture plan. While PacifiCare shall be primarily
      responsible for this activity, Supplier shall serve as a key collaborator
      with PacifiCare. As such, Supplier shall provide reasonable access to
      specialists within its organization as needed to assist PacifiCare to
      develop and maintain the long-range information systems plan and
      equipment/software architecture plan. Supplier's responsibility for such
      functions shall also include the following:

            -     Assist PacifiCare in developing an understanding of and
                  confirm the business requirements;

            -     Assist in identifying information and associated technology
                  needs;

            -     Assist in identifying the projects to be performed along with
                  helping define schedules and high-level cost benefit analysis;
                  and

            -     Assist in specifying the Equipment/Software architecture and
                  participate in continuously keeping PacifiCare's information
                  systems architecture current.

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V.    DEFINITION OF TERMS USED IN STATEMENT OF WORK:

      The following terms when used in this Statement of Work with initial
      capital letters shall have the respective meanings set forth herein. Terms
      used with initial capital letters that are not defined herein shall have
      the meaning set forth in the Agreement.

            a.    ACCEPTANCE TEST means the process, as specified in the
                  Agreement through which the applicable Products, Services,
                  Software, Systems, Equipment, proposal or plan are subjected
                  to the applicable acceptance test.

            b.    AMM (APPLICATION MANAGEMENT METHODOLOGY) is defined in Section
                  I.H of this Statement of Work.

            c.    APPLICATIONS MAINTENANCE means any effort where modifications
                  to existing Systems are made to correct/fix code or processes
                  that are either no longer operational or shall cease to
                  function properly without the correction. Maintenance
                  activities include those described in Section II.B of this
                  Statement of Work and handling Help Desk tickets related to
                  resolving production issues or coding bugs; production
                  monitoring and trouble-shooting; routine capacity assessment
                  and tuning; SQM (Service Quality Metrics) reporting.

            d.    BUSINESS CONTINUITY PLAN means PacifiCare's business
                  continuity plan as of the Cutover Date as may be shared with
                  Supplier during the Transition Period and as required to be
                  expanded and improved by Infrastructure Supplier.

            e.    CALL means a call to the Help Desk from an End-User requesting
                  assistance that is related to the Services.

            f.    CHANGE MANAGEMENT PROCEDURE shall have the meaning set forth
                  in the Policy and Procedures Manual. This is the process that
                  controls day-to-day introduction of changes into the
                  environment.

            g.    CMM means the Capability Maturity Model from the Carnegie
                  Mellon Software Engineering Institute.

            h.    CUSTOMER SUPPORT means any effort required prior to
                  establishing a development project or work on minor data
                  changes, reports, End-User questions or training requests.
                  PacifiCare shall approve Customer Support work and prioritize
                  the activities, but not all Customer Support requests are
                  approved. Customer Support includes: Help Desk tickets not
                  related to resolving production issues or bugs; minor End-User
                  training; answering and addressing direct calls from business
                  partners; business management requests for pre-project
                  consultation (research, analysis, brainstorming, estimating);
                  regular business partner/status meetings - not project
                  related; business requested support for Application
                  demonstrations to customers; business requested support for
                  generating presentation materials, not project related;
                  meetings with employer groups/providers as requested by
                  business partners; updates to production data or tables done
                  outside of the normal Application functionality.

            i.    DATABASE ADMINISTRATION (DBA) is defined in Section III.N of
                  this Statement of Work.

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PACIFICARE CONFIDENTIAL

            j.    DEVELOPMENT SERVICES is defined in Section III.C.1 of this
                  Statement of Work.

            k.    DISASTER RECOVERY means the ability to recover those services
                  designated as Critical Services by PacifiCare within
                  PacifiCare specified time frames and sequences specified by
                  PacifiCare (when changes to existing plans are required such
                  changes shall be processed through the Change Management
                  Procedure) via the use of a recovery capability provided by
                  PacifiCare, the Infrastructure Supplier or other third party
                  suppliers.

            l.    ERROR CORRECTION is defined in Section II.B.1 of this
                  Statement of Work.

            m.    HELP DESK means a help desk that provides reactive and
                  proactive problem determination, resolution and/or tracking
                  and an initial response to End-Users as described in Section
                  III.S of this Statement of Work. The typical Help Desk
                  functions include call answer, Service Request tracking,
                  escalation to second or third-level support, dispatch of
                  support and problem management as applicable. [...***...]

            n.    HELP DESK SUPPORT is defined in Section III.S of this
                  Statement of Work.

            o.    MAJOR PROJECT is defined in Section II.A of this Statement of
                  Work.

            p.    METHODOLOGY is defined in Section 1.1 of Attachment B to this
                  Statement of Work.

            q.    MINOR PROJECT is defined in Section II.A of this Statement of
                  Work.

            r.    NEW DEVELOPMENT means any approved effort to develop or
                  implement new Applications. PacifiCare shall retain control
                  over awarding this New Development to Supplier or another
                  third party.

            s.    PACIFICARE PRIORITIZATION AND GOVERNANCE AND SERVICE REQUEST
                  PROCESSES means the existing PacifiCare processes used to
                  collect and filter proposals from the business and information
                  systems, estimate, prioritize and submit them for senior
                  management approval, then manage scope, schedule and budget
                  changes for the approved projects.

            t.    PREVENTATIVE MAINTENANCE is defined in Section II.B.2 of this
                  Statement of Work.

            u.    PROJECT means any approved effort to implement, to develop and
                  to enhance the Applications as required and necessary to
                  accommodate the evolution of PacifiCare's environments and
                  business requirements.

            v.    PROJECT, CUSTOMER SUPPORT AND APPLICATION MAINTENANCE SERVICES
                  is defined in Section I.A of this Statement of Work.

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      w.    PROJECT SERVICES is defined in Section II.A of this Statement of
            Work.

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                                  ATTACHMENT A

               SUPPLIER WORK PRODUCT FUNCTIONAL DESCRIPTION MATRIX

This attachment identifies the processes and deliverables required for services
for which the Supplier provides.

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------
                                          SUPPORT                                      PROJECTS
------------------------------------------------------------------------------------------------------------------------
<S>                               <C>                      <C>                <C>                  <C>
------------------------------------------------------------------------------------------------------------------------
                                                           END-USER           MINOR                MAJOR
  PROJECT TASKS                   MAINTENANCE              SUPPORT            (Less than or        (> 750 HOURS)
                                                                              equal to 750 HOURS)
------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------
  [...***...]                      [...***...]            [...***...]         [...***...]          [...***...]
------------------------------------------------------------------------------------------------------------------------
</TABLE>

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<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------
                                          SUPPORT                                            PROJECTS
------------------------------------------------------------------------------------------------------------------------
<S>                               <C>                      <C>                <C>                  <C>
------------------------------------------------------------------------------------------------------------------------
                                                           END-USER           MINOR                MAJOR
  PROJECT TASKS                   MAINTENANCE              SUPPORT            (Less than or        (> 750 HOURS)
                                                                              equal to 750 HOURS)
------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------
  [...***...]                      [...***...]            [...***...]         [...***...]          [...***...]
------------------------------------------------------------------------------------------------------------------------
</TABLE>

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<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------
                                          SUPPORT                                            PROJECTS
------------------------------------------------------------------------------------------------------------------------
<S>                               <C>                      <C>                <C>                  <C>
------------------------------------------------------------------------------------------------------------------------
                                                           END-USER           MINOR                MAJOR
  PROJECT TASKS                   MAINTENANCE              SUPPORT            (Less than or        (> 750 HOURS)
                                                                              equal to 750 HOURS)
------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------
  [...***...]                      [...***...]            [...***...]         [...***...]          [...***...]
------------------------------------------------------------------------------------------------------------------------
</TABLE>

      All items identified as "YES" are required, those as "No" are not
required. Those identified as Yes or No shall be tailored to the requirements
and revised periodically when the Policy and Procedures Manual is reviewed.

      For purposes of additional clarification selected project tasks are
      further described as follows:

      [...***...]

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                                  ATTACHMENT B

           SOFTWARE DEVELOPMENT METHODOLOGY ROLES AND RESPONSIBILITIES

1.1   DEFINITION OF PACIFICARE IS METHODOLOGY

      The development and deployment of information systems requires a common
      discipline framed by standard concepts and techniques.

      This framework (or METHODOLOGY) represents an integral part of the
      PacifiCare infrastructure that enables and enhances our ability to manage,
      develop, and deliver quality products. Methodology is a powerful tool that
      can deliver value to an organization by describing repeatable processes
      for building information systems. The intent of IS Methodology is to
      reduce risk by consistently applying proven processes to project
      development.

      The dynamics of the development effort demands a FLEXIBLE Methodology.
      Even though the Methodology appears to be linear, left to right, most
      projects actually return back to early phases to repeat some activities
      with more detail. [...***...]

      PRODUCT METHODOLOGY recommends appropriate phases, activities,
      deliverables, roles and Q/A, but does not prevent or imply the use of a
      specific style. Development style or approach selection is a Project
      Management decision based on the project's requirements along with
      adherence to IS standards and practices.

      The I.S. Methodology has been created to support the PacifiCare
      environment and designed to maximize efficiency and ensure consistency in
      the development, implementation, and maintenance of systems across
      Corporate IS.

            PACIFICARE I.S. METHODOLOGY COMPONENTS

            PacifiCare Information Services believes that a quality I.S.
            Methodology must include the following three components:

            1.    PRODUCT METHODOLOGY

                  [...***...]

            2.    PROJECT MANAGEMENT METHODOLOGY

                  Project Management is used to manage, track and control
                  project:

                  [...***...]

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            3.    QUALITY ASSURANCE (Q/A)

                  [...***...]

1.2   PURPOSE & APPROACH

      The purpose of this guide is to provide:

      -     GUIDELINES AND DEFINITIONS THAT ARE NEEDED TO CREATE AND EFFORT
            DEMANDS A FLEXIBLE MANAGE QUALITY APPLICATION SOFTWARE AND
            TECHNOLOGY SOLUTIONSRT DEMANDS A FLEXIBLE AT PACIFICARE. THIS GUIDE
            IS NOT DESIGNED TO PROVIDET DEMANDS A FLEXIBLE STEP-BY-STEP
            INSTRUCTIONS. IT IS DESIGNED TO PROVIDE A ROADMAP OF ACTIVITIES THAT
            WILL RESULT IN CONSISTENT RESULTS.P

      The following approach was used in constructing the Methodology :

            [...***...]

1.3   IMPORTANT METHODOLOGY ACCESS INFORMATION

      A. WHO NEEDS TO USE IT

            [...***...]

      B. REQUIRED ACCESS PRIVILEGES

            [...***...]

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                                   [...***...]

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                                  ATTACHMENT C

     PACIFICARE PRIORITIZATION AND GOVERNANCE AND SERVICE REQUEST PROCESSES

      [...***...]

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B.    PACIFICARE CURRENT PROJECT RANKING AND GOVERNANCE PROCESS

PacifiCare systems solutions are firmly integrated with our business processes
and are key to our success as a corporation. Information Services Systems
Development is working to implement standards and incorporate best practices in
developing and rolling out new and enhanced applications. These standards enable
us to better manage our IS resources and budgets, and allow us to repeat those
things that make projects successful while avoiding those that don't. The first
step in this process is to provide business teams with a template to capture
business requirements for all new projects.

[...***...]

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[...***...]

PRAG Fast Track Flowchart

[...***...]

[FLOWCHART]

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                                   [...***...]

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[...***...]

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[...***...]

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[...***...]

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[...***...]

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[...***...]

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[...***...]

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[...***...]

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[...***...]

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[...***...]

     ** ELECTRONIC FORM ** - TO BE COMPLETED ON-LINE AND ROUTED VIA E-MAIL

PACIFICARE(R)
HEALTH SYSTEMS

                                                    A. Date Submitted:__________

                              INFORMATION SERVICES

    NEW PROJECT PROPOSAL / SERVICE REQUEST (NPP / SR) - VALUATION WORKSHEET

[...***...]
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[...***...]

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[...***...]

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Information Services Priorities Worksheet

[...***...]

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                                  [...***...]

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                                    EXHIBIT C

                         PACIFICARE INCLUDED AFFILIATES

Antero Health Plans, Inc.
(an Colorado corporation)

FHP Reinsurance Limited
(a Bermuda corporation)

Health Maintenance Life, Inc.
(a Guam corporation)

PacifiCare of Arizona, Inc.
(an Arizona corporation)

PacifiCare Asia Pacific Insurance Brokers, Inc.
(a Guam corporation)

PacifiCare Behavioral Health of California, Inc.
(a Delaware corporation)

PacifiCare Behavioral Health, Inc.
(a Delaware corporation

PacifiCare of California
(a California corporation)

PacifiCare of Colorado, Inc.
(a Colorado corporation)

PacifiCare Dental of Colorado, Inc.
(a Colorado corporation)

PacifiCare Dental
(a California corporation)

PacifiCare eHoldings, Inc.
(a California corporation)

PacifiCare Health Insurance Company of Micronesia, Inc.
(a Guam corporation)

PacifiCare Health Plan Administrators, Inc.
(an Indiana corporation)

PacifiCare Health Systems Foundation
(a California nonprofit corporation)

PacifiCare Health Systems, Inc.
(a Delaware corporation)

PacifiCare International Limited

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(an Irish Company)

PacifiCare Life Assurance Company
(a Colorado corporation)

PacifiCare Life and Health Insurance Company
(an Indiana corporation)

PacifiCare Life Insurance Company
(an Arizona corporation)

PacifiCare of Nevada, Inc.
(a Nevada corporation)

PacifiCare of Ohio, Inc.
(an Ohio corporation)

PacifiCare of Oklahoma, Inc.
(an Oklahoma corporation)

PacifiCare of Oregon, Inc.
(an Indiana corporation)

PacifiCare of Texas, Inc.
(an Oregon corporation)

PacifiCare Ventures, Inc.
(a California corporation)

PacifiCare of Washington, Inc.
(a Washington corporation)

RxConnect Acquisition Corporation
(a California corporation)
RxSolutions, Inc.
(a California corporation)

SecureHorizons USA, Inc.
(a California corporation)

SeniorCo, Inc.
(a Delaware corporation)

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                              SCHEDULE 3.1 (b) (i)

                              AFFECTED CONTRACTORS

For confidentiality purposes, the information in this schedule will only be
accessible to the PacifiCare Supplier Relationship Vice President, the Keane
Account Executive, and other personnel (e.g., Human Resources, Legal, etc.) as
deemed necessary.

[...***...]

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                              SCHEDULE 3.1 (b) (ii)

                               AFFECTED EMPLOYEES

For confidentiality purposes, the information in this schedule will only be
accessible to the PacifiCare Supplier Relationship Vice President, the Keane
Account Executive, and other personnel (e.g., Human Resources, Legal, etc.) as
deemed necessary.

[...***...]

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                                  SCHEDULE 3.5

             TECHNICAL ARCHITECTURE AND PRODUCT STANDARDS PROCEDURES

<PAGE>

PACIFICARE (R)
HEALTHSYSTEMS

                                 ENTERPRISE-WIDE
                             TECHNICAL ARCHITECTURE
                                       FOR
                            PACIFICARE HEALTH SYSTEMS

                              [LOGO] PACIFICARE (R)

                          DOMAIN ARCHITECTURE DOCUMENT

                                GOVERNANCE DOMAIN

                                  [...***...]

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<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S>                                                                                                              <C>
GOVERNANCE DOMAIN ARCHITECTURE...................................................................................     3

   About This Document...........................................................................................     3
   Document History..............................................................................................     3
   Related Documents.............................................................................................     3
   Governance Domain Participants................................................................................     3
   Governance Domain Definition..................................................................................     5
   Governance Domain Vision......................................................................................     5
   Governance Domain Executive Summary...........................................................................     5
   Governance Principles.........................................................................................     7
   Governance Organizations......................................................................................     8
     Key Architecture Entities...................................................................................     9
     Architecture Oversight Bodies...............................................................................    12
   Governance Processes..........................................................................................    15
     Management Processes........................................................................................    16
     Consulting Processes........................................................................................    23
     Communication Processes.....................................................................................    25
   Gap Analysis..................................................................................................    29
   Appendices....................................................................................................    32
     Appendix 1. Roles and Responsibilities for Enterprise Architecture Processes................................    32
     Appendix 2. EWTA Domain Ratification and Maintenance Process................................................    32
     Appendix 3. EWTA Exception Management and Compliance Process................................................    32
</TABLE>

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<PAGE>

                         GOVERNANCE DOMAIN ARCHITECTURE

ABOUT THIS DOCUMENT

The Governance Domain details the principles, organizations, roles and
responsibilities, services, processes and the workflow for the PacifiCare Health
Systems (PacifiCare) Enterprise Architecture (EA).

DOCUMENT HISTORY
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
Version             Date            Team Member                 Reason
--------------------------------------------------------------------------------
<S>                 <C>             <C>                         <C>
[...***...]         [...***...]     [...***...]                 [...***...]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
RELATED DOCUMENTS
--------------------------------------------------------------------------------
Document Title      Relevance        Owner           How to obtain
--------------------------------------------------------------------------------
<S>                 <C>              <C>             <C>
[...***...]         [...***...]      [...***...]     [...***...]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
</TABLE>

GOVERNANCE DOMAIN PARTICIPANTS

          DOMAIN TEAM LEADER: [...***...]

          DOMAIN PARTICIPANTS:  [...***...]

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          CORE TEAM COORDINATOR:  [...***...]

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GOVERNANCE DOMAIN DEFINITION

Te Governance Architecture details the overall governance process for
PacifiCare's Enterprise Architecture (EA), including the various oversight
committees and their roles/responsibilities. Governance is the framework for
defining who is responsible for what and how decisions are made related to the
evolution of PacifiCare's Enterprise-Wide Technical Architecture (EWTA). It is
also the mechanism for ensuring compliance with the principles set forth in the
conceptual architecture and various domain architectures.

The terms EWTA and EA are utilized extensively throughout this document. EWTA
refers to the principles, standards and technology elements that make up
PacifiCare's architecture, i.e., "the What". EA refers to the governance of the
processes, touchpoints, and organizations that determine how the architecture
operates at PacifiCare, i.e., "the Who, What, Where and When."

GOVERNANCE DOMAIN VISION

PacifiCare facilitates the evolution of its technology infrastructure via
proactive and unified governance of the EWTA by all stakeholders. The conceptual
and domain design principles, which make up the EWTA, are the primary criteria
for decisions related to evolution of the EWTA and will be employed by all
stakeholders.

GOVERNANCE DOMAIN EXECUTIVE SUMMARY

EA Governance consists of four key elements: the EWTA, governance principles,
organizations and processes that must be established and maintained to insure
effective and sustainable governance and evolution of the ETWA. The following
describes each of these key EA Governance elements:

      -     EWTA - Consists of the Common Requirements Vision (CRV), Conceptual
            Architecture principles (CA), Domain Architecture design principles,
            standards, products, design patterns and technology roadmaps that
            guide PacifiCare's IT investments. [...***...]

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[...***...]

      -     GOVERNANCE PRINCIPLES - Guiding principles for governance of the
            evolution of PacifiCare's EA. The principles provide a context for
            consistent architecture and program management decision-making.

      -     ORGANIZATION - The organizations that make up PacifiCare's EA
            function, their roles and responsibilities and the services they
            provide.

      -     PROCESSES - The processes and workflow for the services that make up
            EA at PacifiCare. These include strategy, EWTA maintenance, EWTA
            compliance, administration, project architecture, communications,
            knowledge management, and training processes.

Figure 1 graphically depicts the elements EA Governance:

                            FIGURE 1. EA GOVERNANCE

                            [EA GOVERNMENT TRIANGLE]

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GOVERNANCE PRINCIPLES

The following governance principles will guide the establishment and evolution
of PacifiCare's EA governance process:

      1.    UNIFIED. [...***...]

      2.    INCLUSIVE. [...***...]

      3.    COMPREHENSIVE. [...***...]

      4.    EVOLUTIONARY. [...***...]

      5.    COLLABORATIVE. [...***...]

      6.    ACCESSIBLE. [...***...]

      7.    EFFICIENT. [...***...]

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GOVERNANCE ORGANIZATIONS

(ARCHITECTURE ORGANIZATIONS, ROLES AND RESPONSIBILITIES)

There are a number of entities that are critical to the management of the
PacifiCare EA. In addition there is a hierarchy of architecture oversight bodies
responsible for the maintenance of and compliance to the EWTA. These are
depicted and described below:

[...***...]

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                                  [...***...]

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                                  [...***...]

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                                  [...***...]

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                                  [...***...]

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                                  [...***...]

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                                  [...***...]

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GOVERNANCE PROCESSES

(ARCHITECTURE PROCESSES AND WORKFLOW)

There are eight EA core processes. [...***...]

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MANAGEMENT PROCESSES

Management processes define, develop, evolve and manage the EA for the
enterprise.

      -     STRATEGY - As business direction and IT strategy of PacifiCare
            evolve, the IT Executive and EA Teams work to ensure that the vision
            and strategic intent of EA evolve to meet these changing business
            needs.

[...***...]

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      -     ADMINISTRATION - Administration encompasses the day-to-day EA
            governance activities performed by the EA Team to ensure effective
            operation of the EWTA at PacifiCare.

[...***...]

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                                  [...***...]

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      -     MAINTENANCE - The ARB governs evolution of the EWTA to ensure that
            it is responsive to changes in PacifiCare's business environment and
            the technology market. The ARB authorizes the EA Team to update the
            EWTA to continually align PacifiCare's technology standards and
            products with the goals and objectives of the business and the
            changing technology marketplace. Appendix 2. EWTA Domain
            Ratification and Maintenance Process flowcharts the EWTA Maintenance
            process and responsibilities.

[...***...]

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                                  [...***...]

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      -     COMPLIANCE - Compliance is crucial to the long-term success of the
            EA because it details the means by which the EWTA technology
            standards and products will be adhered to throughout the enterprise.

[...***...]

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                                  [...***...]

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CONSULTING PROCESSES

Consulting processes support the application and utilization of the EWTA
standards and EA methodology throughout the enterprise.

      -     PROJECT ARCHITECTURE - The EA Team provides support to Project
            Architects on large Technology and Application Software projects to
            assist them with their architecture needs. The Project Architect
            position is both strategic and tactical in nature. From the
            strategic perspective, the Project Architect provides alignment with
            the EWTA and overall architectural leadership and vision for the
            project team. From the tactical perspective, the Project Architect
            must transform conceptual architectural vision into concrete
            deliverables used by the project, program, development,
            infrastructure, logistics, and business teams.

[...***...]

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TRAINING - The EA Team establishes an architecture training framework to align
training offerings with architectural principles and standards and promote
overall architecture education within the IT community.

[...***...]

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COMMUNICATION PROCESSES

Communication processes support the means for EA information dissemination and
sharing throughout the enterprise and promote awareness and understanding of the
EA process and guidelines.

      -     KNOWLEDGE MANAGEMENT - The EA Team provides a readily accessible and
            useable EA knowledge base that stores, manages and makes available
            the EWTA principles, standards, methodologies, templates, tools and
            other resources that comprise the EA.

[...***...]

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                                  [...***...]

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      -     COMMUNICATIONS - A consistent, broadly shared and readily available
            view of the EA is critical to building organizational understanding
            and adoption of EA processes within PacifiCare. Promoting a shared
            understanding requires a focused and ongoing communications effort.

[...***...]

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                                  [...***...]

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GAP ANALYSIS

The Gap Analysis provides a description of the gaps between current state of EA
Governance and the ideal state as outlined in this document as of September of
2001.
[...***...]

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                                  [...***...]

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                                  [...***...]

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APPENDICES

APPENDIX 1. ROLES AND RESPONSIBILITIES FOR ENTERPRISE ARCHITECTURE PROCESSES

The enclosed spreadsheet summarizes the involvement of the Governance
Organizations with each process.

APPENDIX 2. EWTA DOMAIN RATIFICATION AND MAINTENANCE PROCESS

The enclosed swimlane diagram flowcharts the workflow for this process.

APPENDIX 3. EWTA EXCEPTION MANAGEMENT AND COMPLIANCE PROCESS

The enclosed swimlane diagram flowcharts the workflow for this process.

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                                   APPENDIX 1

                    ROLES AND RESPONSIBILITIES FOR ENTERPRISE
                             ARCHITECTURE PROCESSES

                                   [...***...]

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<PAGE>

                                   APPENDIX 2

                            EWTA DOMAIN RATIFICATION
                             AND MAINTENANCE PROCESS

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                   APPENDIX 3

                EWTA EXCEPTION MANAGEMENT AND COMPLIANCE PROCESS

                                   [...***...]

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<PAGE>

                                 SCHEDULE 3.8(b)

<PAGE>

                                 SCHEDULE 3.8(b)

                                     REPORTS

Without limiting or altering Supplier's responsibility to provide any reports,
updates, invoices or similar documentation to PacifiCare as set forth in the
Agreement or any exhibit, schedule or attachment thereto, and without limiting
any of Supplier's other responsibilities as set forth in the Agreement or any
exhibit, schedule or attachment thereto, Supplier shall provide PacifiCare the
reports set forth in this SCHEDULE 3.8(b) (the "REPORTS") in accordance with the
terms of this SCHEDULE 3.8(b) and APPENDIX 1 hereto ("SCHEDULE 3.8(b)").

Supplier shall not change or discontinue producing any Report without the
approval of PacifiCare.

Supplier shall work with PacifiCare to determine the best means and formats by
which to provide Reports, including options such as Web access, online graphical
reports, and file transfer. For any Reports not set forth herein or otherwise
described in the Agreement or any exhibit, schedule or attachment thereto,
PacifiCare and Supplier shall mutually determine the content, format and
frequency of such Reports.

All Reports and all contents thereof shall be PacifiCare Data.

PRODUCTION REPORTS:

PRODUCTION REPORTS. [...***...]

OPERATIONAL REPORTS.

In addition to any Reports required above, Supplier shall produce operational
reports for PacifiCare that describe the operations and Services performed by
Supplier ("OPERATIONAL REPORTS"). The Operational Reports shall include:

1. SECURITY BREACH REPORT. As set forth in SECTION 10.4 of the Agreement,
Supplier shall deliver to PacifiCare Reports of all security breaches and
potential breaches discovered by or made known to Supplier. Supplier shall
deliver such Reports regarding security breaches and potential breaches
immediately following such breach or the discovery of such breach or potential
breach by Supplier.

2. DISASTER RECOVERY TEST SUMMARY. As set forth in SECTION 16.1 of the Agreement
and elsewhere, Supplier shall provide PacifiCare Reports of disaster recovery
test and retest results as required pursuant to SECTION 16.1 of the Agreement
and in Section III.X of Exhibit B and as otherwise conducted by Supplier, which
such Reports shall be delivered promptly following any such disaster recover
test or retest ("DISASTER RECOVERY TEST SUMMARY REPORTS").

3. VARIABLE FEES REPORT AND RELATED REPORTS. During the Term and Termination
Assistance Period Supplier shall provide PacifiCare a monthly Variable Fees
Report as set forth in SECTION 17 of the Agreement.

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4. APPLICATIONS SOFTWARE REPORT. Supplier shall provide PacifiCare a Report for
each calendar quarter during the Term and the Termination Assistance Period of
all Software subject to or used in connection with the Services, including all
modifications, enhancement, maintenance updates and other changes thereto (each,
an "APPLICATIONS SOFTWARE REPORT").

5. SERVICE LEVEL REPORTS. Supplier shall provide PacifiCare a monthly Service
Level Report as defined in SECTION I.C of SCHEDULE 8 to the Agreement ("SERVICE
LEVEL REPORTS"). [...***...]

6. SERVICE LEVEL MANAGEMENT REPORTS.

      a) [...***...]

      b) [...***...]

7. PROBLEM MANAGEMENT REPORTS. Supplier shall produce a monthly Report
containing number and types of problems [...***...]

8. CHANGE MANAGEMENT REPORTS. Supplier shall produce a monthly Report detailing
all changes, modifications, updates, revisions and other functions relevant to
Change Management Process (as defined in the Policy & Procedures Manual),
[...***...]

9. BILLING RESOLUTION REPORTS. As requested by PacifiCare, Supplier shall
provide to PacifiCare Reports that shall provide detailed summaries of issues
with respect to billing [...***...]

10. PROJECT MANAGEMENT REPORTS. Supplier shall provide Reports regarding the
status of all current and planned Projects as set forth in EXHIBIT B to the
Agreement ("PROJECT STATUS REPORTS").

11. CUSTOMER SATISFACTION REPORTS. Supplier shall provide PacifiCare a monthly
Report with respect to the customer satisfaction surveys, results and other
related functions as set forth in SCHEDULE 8 to the Agreement ("CUSTOMER
SATISFACTION REPORTS").

12. TRANSITION REPORTS.

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(a) TRANSITION GANTT CHART UPDATE. In conjunction with the Infrastructure
Supplier, on the last day of each month during the Transition Period, Supplier
shall provide PacifiCare with an updated hard copy Gantt chart detailing the
current status of all transition tasks ("TECHNICAL GANTT CHART UPDATE").

(b) TRANSITION STATUS REPORT. In conjunction with the Infrastructure Supplier,
on the last day of each month during the Transition Period, Supplier shall
provide PacifiCare with a written Report detailing Supplier's status with
respect to the Transition Services and Transition Plan ("TRANSITION STATUS
REPORTS"), which shall include the following:

            (i) STATUS SUMMARY - Each Transition Status Report shall include an
executive-level summary of transition progress to-date, including an updated
summary with respect to the Transition Plan and relevant accomplishments and
failures of Supplier with respect thereto.

            (ii) CRITICAL MILESTONE STATUS - Each Transition Status Report shall
include a listing of all Critical Milestones as set forth in SECTION 4.2 of the
Agreement, along with: estimated time to completion of such Critical Milestones,
days that each Critical Milestone is overdue, anticipated completion date for
each Critical Milestone and related comments.

            (iii) CRITICAL ISSUES LIST - Each Transition Status Report shall
include a listing of all unresolved issues related to the Transition Plan and
Transition Services, including those for which PacifiCare has primary
responsibility, including due dates, priority lists, identification of the
responsible Party for tasks and projects related to the Transition Plan,
potential and actual business and Transition Plan execution impact assessment.

13. CAPACITY AND PERFORMANCE REPORT. In conjunction with Infrastructure
Supplier, the Supplier shall publish a capacity and performance report,
[...***...]

14. AD HOC REPORTS. Supplier shall produce other reports requested by PacifiCare
("AD HOC REPORTS") as set forth in EXHIBIT B to the Agreement.

15. SECURITY REPORTS. In conjunction with the Infrastructure Supplier, the
Supplier shall produce monthly reports for PacifiCare that describe various
functions that impact on security ("SECURITY REPORTS"). [...***...]

            (a) [...***...]

16. AUDIT REPORTS. Supplier shall produce audit reports for PacifiCare for the
auditing functions described in EXHIBIT B Statement of Work ("AUDIT REPORTS").

17. CLAIMS PROCESSING REPORTS. Supplier shall produce reports for PacifiCare
relating to Claims Processing.

            (a) [...***...]

            (b) [...***...]

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18. SUPPLIER STAFFING REPORTS. Supplier shall review the following reports with
the PacifiCare Supplier Relationship Manager, or other applicable PacifiCare
personnel, each month and shall work with such PacifiCare personnel, to create
plans to address any problems or concerns resulting from the content of such
reports.

      (a)   [...***...]

      (b)   [...***...]

      (c)   [...***...]

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                          APPENDIX 1 TO SCHEDULE 3.8(b)

The following is a summary of the Reports described in Schedule 3.8(b), the
frequency and timing of such Reports and the date Supplier shall begin to
deliver such Reports to PacifiCare. Unless otherwise indicated, during the Term
and Termination Assistance Period (1) any Report that is described as "Monthly"
shall be due [...***...] and shall address the appropriate information for the
immediately preceding month, (2) any Report that is described as "Quarterly"
shall be due [...***...] and shall address the appropriate information for the
immediately preceding quarter, and (3) any Report that is described as "Weekly"
shall be due on the first Business Day immediately following the week for which
such Report is provided.

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
NO.            REPORT TITLE                      FREQUENCY AND TIMING                  COMMENCEMENT DATE FOR REPORTING
----------------------------------------------------------------------------------------------------------------------
<S>            <C>                               <C>                                  <C>
               Production Reports                [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
                                                                                       As noted below or as otherwise
               Operational Reports               [...***...]                           agreed by the Parties
----------------------------------------------------------------------------------------------------------------------
1              Security Breach Report            [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
               Disaster Recovery Test Summary
2              Reports                           [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
               Variable Fees Report and
3              Related Reports                   [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
4              [...***...]                       [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
5              Service Level Reports             [...***...]                           As provided Schedule 8
----------------------------------------------------------------------------------------------------------------------
6              Service Level Management Reports  [...***...]                           As noted below
----------------------------------------------------------------------------------------------------------------------
6(a)           [...***...]                       [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
6(b)           [...***...]                       [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
7              Problem Management Reports        [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
8              Change Management Reports         [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
</TABLE>

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<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
<S>            <C>                               <C>                                   <C>
9              Billing Resolution Report         [...***...]                           Effective Date
----------------------------------------------------------------------------------------------------------------------
10             Project Management Reports        [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
               Customer Satisfaction and
11             Initiative Reports                [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
12             Transition Reports
----------------------------------------------------------------------------------------------------------------------
12(a)          Technical Gantt Chart Update      [...***...]                           Effective Date
----------------------------------------------------------------------------------------------------------------------
12(b)          Transition Status Report          [...***...]                           Effective Date
----------------------------------------------------------------------------------------------------------------------
13             Capacity and Performance Report   [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
14             Ad Hoc Reports                    [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
15             Security Reports                  [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
16             Audit Reports                     [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
17             Claims Processing Reports
----------------------------------------------------------------------------------------------------------------------
17(a)          Daily Processing Times            [...***...]                           Cutover Date
----------------------------------------------------------------------------------------------------------------------
17(b)          Claims Processing Threshold       [...***...]                           Cutover Date
               Limit
----------------------------------------------------------------------------------------------------------------------
</TABLE>

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                                  SCHEDULE 4.1

                         PACIFICARE TRANSITION SCHEDULE

                                   [...***...]

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<TABLE>
<CAPTION>
                                                                         PACIFICARE
                                                                 DRAFT TRANSITION SCHEDULE
------------------------------------------------------------------------------------------------------------------------------------
 ID   WBS          Task Name                                    Owner    Assisting     Duration     Start       Finish  Predecessors
------------------------------------------------------------------------------------------------------------------------------------
<S>   <C>          <C>                                        <C>        <C>          <C>          <C>         <C>        <C>
 1    1            PacifiCare Integrated Transition Schedule  IBM/Keane    PHS          [...***...] [...***...] [...***...]
------------------------------------------------------------------------------------------------------------------------------------
      [...***...]  [...***...]                                 [...***...] [...***...]  [...***...] [...***...] [...***...]
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                   [...***...]

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                                  SCHEDULE 4.2

                         CRITICAL TRANSITION MILESTONES

<TABLE>
<CAPTION>
 ITEM #                    TRANSITION MILESTONE                          DUE DATE
-----------------------------------------------------------------------------------------
<S>      <C>                                                             <C>
    1     Contract Effective Date                                        [...***...]
-----------------------------------------------------------------------------------------
    2     Transition Team Key Personnel Secured                          [...***...]
-----------------------------------------------------------------------------------------
    3     Project Schedule Finalized                                     [...***...]
-----------------------------------------------------------------------------------------
    4     PacifiCare Employees Transitioned to Supplier(s)               [...***...]
-----------------------------------------------------------------------------------------
    5     SM&E CMM Processes defined                                     [...***...]
-----------------------------------------------------------------------------------------
    6     SME Transition Complete                                        [...***...]
-----------------------------------------------------------------------------------------
</TABLE>

Keane assumes that the Contract Effective Date of [...***...] and the Cutover
Date shall be [...***...]. If either the Contract Effective Date or Cutover Date
changes, the remaining Item #'s shall shift the appropriate number of days.

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                                 SCHEDULE 6.3(a)

              FACILITIES SPACE REQUIREMENTS AND RULES & REGULATIONS

A.   INTRODUCTION

This Schedule defines the use of PacifiCare Service Locations by Supplier in
order to provide Services as well as the Rules and Regulations that must be
followed for use of the facilities.

B.   FACILITIES PLAN

Initial space requirements will include space that is currently being used by
the "in-scope" personnel as of the Effective Date. Within [...***...] of
Transition start, Steady State facilities plans and space requirements will be
documented.

<TABLE>
<CAPTION>
                                                STAFFING PLAN AND SPACE REQUIREMENTS
------------------------------------------------------------------------------------------------------------------------
                                 Jan   Feb  Mar   Apr   May   Jun   Jul  Aug   Sep   Oct   Nov   Dec  2003  2004
                                  02    02   02    02    02    02   02    02    02    02    02    02
------------------------------------------------------------------------------------------------------------------------
<S>                              <C>   <C>  <C>   <C>   <C>   <C>  <C>   <C>   <C>   <C>   <C>   <C>  <C>   <C>

</TABLE>

<TABLE>
<S>                <C>                                                  <C>
Program Office     Employees

 (IBM/Keane)       Contractors

                           Total

Transition         Employees

 (IBM)             Contractors                                          [...***...]

                          Total

Transition         Employees

 (Keane)*          Contractors

                           Total

SM&E **            Employees

 (Keane)           Contractors

                           Total

Total              Employees

                   Contractors

                     Grand Total
------------------------------------------------------------------------------------------------------------------------
</TABLE>

PROGRAM OFFICE & TRANSITION - [...***...]

** SM&E ENGAGEMENT TRANSITION [...***...]

IBM HR TRANSITION - [...***...]

SM&E HR TRANSITION - [...***...]

* IBM - [...***...]

** SM&E - [...***...]

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C. RULES, REGULATIONS AND RESTRICTIONS AT PACIFICARE SERVICE LOCATIONS

Supplier agrees to comply with all of the rules, regulations and restrictions
set forth below, and with any reasonable amendments or additions thereto as
PacifiCare or its landlord may deem necessary from time to time in accordance
with Section 6.4 of the Agreement.

      (1) Except in emergency situations, supplier shall refrain from contacting
any landlord of PacifiCare for any reason or purpose whatsoever. Whenever any
matter provided for herein requires that any such landlord be contacted for
approval, consent, or otherwise, Supplier shall so advise PacifiCare and
PacifiCare will contact the landlord.

      (2) Except in emergency situations, supplier shall refrain from going onto
the roof of any building or building complex in which a PacifiCare Service
Location is situated for any purpose without first having obtained the prior
written consent of PacifiCare and its landlord.

      (3) General office hours and the business hours of operation in relation
to truck dock activity shall be limited to 7:00 a.m. to 9:00 p.m. daily.

      (4) Each of the Supplier's employees and other personnel shall at all
times while at any PacifiCare Service Location wear and display a standard
identification badge issued to them in a manner that allows easy identification
of the employee or personnel. PacifiCare may deny an employee or other Supplier
personnel access to any PacifiCare Service Location if current and proper
identification is not presented and worn while entering and working at any
PacifiCare Service Location.

      (5) Any and all loading and unloading of goods shall be done only at such
times, in the areas and through the entrances designated for such purpose by
PacifiCare or its landlord.

      (6) Supplier shall not, without first having obtained PacifiCare's and its
landlord's prior written consent, make any structural or non-structural interior
or exterior alterations, additions, improvements or utility installations
(including without limitation, alterations to the plumbing, electrical and other
building systems, the boring, cutting or stringing of wires, the laying of
linoleum or other floor coverings, the attachment to or suspension from floors,
walls or ceilings of curtains, blinds, shades, sunscreens, planters, television
sets, telephones, call boxes and other office equipment,) in, on or about any
PacifiCare Service Location.

      (7) Supplier shall (a) promptly pay for all costs of alterations or other
work done or permitted to be done by it or caused by it to be done on or about
any PacifiCare Service Location unless otherwise agreed; (b) keep each
PacifiCare Service Location free and clear of any liens arising out of any such
alterations or work; and (c) in the event any lien is filed against any
PacifiCare Service Location in connection with any alterations or other work
done, permitted or caused to be done by Supplier, Supplier shall, at its sole
cost and expense, obtain a release bond in the statutorily required amount and
issued by a surety approved by PacifiCare and its landlord, immediately after
written request to do so from PacifiCare.

      (8) Any and all garbage, trash and refuse shall be kept in the type of
container specified by PacifiCare's landlord, and shall be placed in the
designated trash enclosures for collection. Supplier shall not burn any trash or
garbage of any kind in or about the building or building complex housing any
PacifiCare Service Location.

      (9) No satellite dish, antenna or other telecommunications equipment shall
be erected in or outside of any PacifiCare Service Location, without in each
instance the written consent of PacifiCare and its landlord. Any such equipment
so installed without such written consent shall be subject to removal without
notice at any time by PacifiCare or its landlord, at the sole cost of Supplier.
In the event any such equipment, installed by or at the request of Supplier
within any PacifiCare Service Location or elsewhere within the building which
houses a PacifiCare Service Location causes interference with or to equipment
used by PacifiCare or another tenant within said building, Supplier shall assume
and pay or discharge all liability arising from or related to such interference
and shall take all necessary actions to eliminate such interference.

                                                                     Page 2 of 6
PacifiCare/Keane Confidential
<PAGE>

      (10) Supplier shall not make or permit to be made any unseemly or
disturbing noises, sounds or vibrations or disturb or interfere with occupants
of the building housing any PacifiCare Service Location or any building complex
which includes such building (collectively, the "Development") by the use of any
musical instrument, radio, phonograph, unusual noise, or in any other way. No
loudspeakers, televisions, phonographs, radios or other devices shall be used in
a manner so as to be heard or seen outside of the PacifiCare Service Location
without the prior written consent of PacifiCare and its landlord. Supplier shall
conduct its business in a quiet and orderly manner so as not to create
unreasonable or unrelated noise.

      (11) Supplier shall not solicit business within the Development by
circulars or otherwise, or take any action which would interfere with the rights
of other persons to use such facilities without the written consent of Landlord,
and shall cooperate with PacifiCare and its landlord to prevent same.

      (12) Supplier shall not place or permit any obstruction in the common
areas immediately adjoining any building housing a PacifiCare Service Location
without the written consent of PacifiCare and its landlord. Supplier shall not
display or sell merchandise, or allow carts, portable signs, signed vehicles,
devices or other objects to be stored or to remain outside of any building
housing a PacifiCare Service Location without the written consent of PacifiCare
and its landlord.

      (13) Supplier and its employees shall be required to park their vehicles
in an area designated by PacifiCare and its landlord for such parking. Supplier
shall not permit any parking by its employees, agents, subtenants, customers,
invitees, concessionaires or visitors on the streets surrounding such building
in violation of any ordinances or postings of any public authorities having
jurisdiction.

      (14) Supplier shall not cause or permit the existence of any obnoxious or
foul odors that disturb the public or other tenants. Should such odors be
evident, Supplier shall be required to take immediate steps to remedy same at
Supplier's expense.

      (15) Supplier shall not obstruct the sidewalks, entrances, passages,
corridors or halls, nor use same for any purpose other than ingress and egress.
The halls, passages, entrances and roof are not for the use of the general
public, and PacifiCare and its landlord shall in all cases retain the right to
control and prevent access thereto by all persons whose presence in the judgment
of PacifiCare or its landlord shall be prejudicial to the safety, character,
reputation or interests of the Development and its tenants, provided that
nothing contained herein shall be construed to prevent such access by persons
with whom the Supplier normally deals in the ordinary course of its business
unless such persons are engaged in illegal activities.

      (16) PacifiCare and its landlord shall have the right to determine and
prescribe the weight and proper position of any unusually heavy equipment,
including, but not limited to, equipment, libraries, safes, large files, and the
like that are to be placed in a PacifiCare Service Location, and only those
which in the opinion of PacifiCare or its landlord will not do damage to the
floors, structure and/or elevators may be moved into a PacifiCare Service
Location. Any damage occasioned in connection with the moving or installing of
such aforementioned articles in a PacifiCare Service Location or the existence
of same therein shall be paid for by Supplier.

      (17) Any telephone mainline and all cabling and gas lines shall be run
only with the prior written approval of PacifiCare and its landlord, and only in
accordance with detailed plans which have been submitted to and approved by
PacifiCare and its landlord.

      (18) The plumbing facilities installed in any PacifiCare Service Location
shall be used only for the purpose for which they were constructed. No foreign
substance shall be deposited in any toilet or sink, and the cost of repair from
any breakage, stoppage or damage resulting therefrom shall be borne by Supplier.

      (19) Supplier shall not overload the electrical circuit breaker panels.

      (20) When cleaning the glass windows and/or aluminum framing, Supplier
must use only mild soap and water and apply with a sponge. No abrasive materials
shall be used. If the window frames are aluminum, ammonia must not be used to
clean the windows.

                                                                     Page 3 of 6
PacifiCare/Keane Confidential
<PAGE>

      (21) No signs, advertisements or notices shall be exhibited, painted or
affixed by Supplier to any PacifiCare Service Center so as to be seen from the
outside of such location without the prior written consent of PacifiCare and its
landlord. In the event Supplier violates the foregoing, PacifiCare and its
landlord may remove same without any liability and may charge Supplier for the
cost of such removal.

      (22) Supplier shall not mark, paint, drill into, or in any way deface any
part of any PacifiCare Service Location or the rest of the Development.

      (23) The PacifiCare Service Locations shall not be used for manufacturing
or for storage of merchandise except as such storage may be incidental to the
use of such locations for those uses contemplated by the Agreement. Supplier
shall not occupy or permit any portion of any PacifiCare Service Location to be
occupied for the manufacture of any illegal substance. The PacifiCare Service
Locations shall not be used for any illegal purposes.

      (24) PacifiCare and its landlord shall have the right to prohibit any
advertising by Supplier which, in PacifiCare or its landlord's opinion, tends to
impair the reputation of any Development, and upon written notice from
PacifiCare or its landlord, Supplier shall refrain from or discontinue such
advertising.

      (25) Canvassing, soliciting and peddling in any Development are prohibited
and Supplier shall cooperate to prevent same.

      (26) All parking ramps and areas, pedestrian walkways, plazas and other
public areas forming a part of any Development shall be under the sole and
absolute control of PacifiCare's Landlord, who has the exclusive right to
regulate and control these areas.

      (27) Suppler shall not place anything or allow anything to be placed near
the glass of any window, door, partition or wall which may appear unsightly from
outside the PacifiCare Service Locations, nor shall Supplier sunscreen any
window without the prior written consent of PacifiCare and its landlord.

      (28) Suppler shall not alter any lock or install any new or additional
locks or bolts on any doors or windows of the PacifiCare Service Locations
without the written consent of PacifiCare and its landlord; provided that in the
event such consent is given, Supplier shall provide PacifiCare with keys to such
locks or bolts.

      (29) Supplier shall see that the windows and doors of the PacifiCare
Service Locations are closed and securely locked, that all water faucets and
other apparatus are entirely shut off, and that, when feasible, all lights and
electrical equipment are entirely shut off before leaving, so as to prevent
waste or damage.

      (30) Supplier shall exercise due care to protect the PacifiCare Service
Locations from theft, robbery or pilferage.

      (31) Supplier shall not place any live load exceeding fifty (50) pounds
per square foot on the floor of any PacifiCare Service Location.

      (32) No animals (except for service animals for persons with disabilities)
or birds may be brought or kept in or about any PacifiCare Service Location or
any building housing a PacifiCare Service Location.

      (33) Supplier shall not use or keep in any PacifiCare Service Location or
any building housing a PacifiCare Service Location any kerosene, gasoline or
other flammable or combustible fluid or material, or use any method of heating
or air conditioning other than that supplied by PacifiCare or its landlord,
except in such quantities and in such containers as are commonly found in
offices and are in compliance with all applicable governmental laws, statutes,
rules, regulations, ordinances and life, safety and fire codes.

      (34) No commercial cooking for sale to the public shall be done or
permitted in any PacifiCare Service Location; nor shall any PacifiCare Service
Location be used for the storage of merchandise, for washing clothes or for
lodging.

                                                                     Page 4 of 6
PacifiCare/Keane Confidential
<PAGE>

      (35) PacifiCare and its landlord shall have the right to exclude or expel
from any PacifiCare Service Location and the building housing any PacifiCare
Service Location any person who, in the judgment of PacifiCare or its landlord,
is intoxicated or under the influence of liquor or drugs, or who shall in any
manner do any act in violation of any of the rules or regulations of the
building housing a PacifiCare Service Location.

      (36) No vending machine or machines of a similar type shall be installed,
maintained or operated at any PacifiCare Service Location without the prior
written consent of PacifiCare and its landlord, provided that any such consent
may be conditioned on Supplier's written undertaking and agreement to indemnify,
defend and hold PacifiCare and its landlord harmless from and against any and
all liability arising out of or resulting from the acts or omissions of persons
supplying goods or services in connection therewith.

      (37) PacifiCare or its landlord shall have the right to control and
operate the public portions of the building housing any PacifiCare Service
Location, any the public facilities, and heating and air conditioning, as well
as any facilities furnished for the common use of all tenants, in such manner as
it deems best for the benefit of such tenants.

      (38) All entrance doors in a PacifiCare Service Location shall be left
locked when such PacifiCare Service Location is not in use, and all doors
opening to public corridors shall be kept closed except for normal ingress and
egress thereto and therefrom.

      (39) Supplier shall, upon termination of its possession of any PacifiCare
Service Location, surrender all keys thereto to PacifiCare and shall make known
to PacifiCare the combination of all combination locks and safes, cabinets and
vaults in such PacifiCare Service Location.

      (40) Supplier shall not employ any person for the purpose of cleaning or
taking care of such location without the written consent of PacifiCare and its
landlord. The janitor of the building housing the PacifiCare Service Location
may at all times keep a pass key, and such janitor or other agents of PacifiCare
and its landlord shall at all times be allowed admittance to said location.

      (41) Bicycles and other vehicles shall not be permitted in the offices,
halls, corridors and elevators in the building housing any PacifiCare Service
Location, nor shall any obstruction of sidewalks or entrances of such building
by such vehicles be permitted.

      (42) All right, title and interest in and to any alternations made by
Supplier to any PacifiCare Service Location shall belong to PacifiCare or its
landlord, free and clear of any claim or interest of Supplier.

      (43) Supplier shall not continue to occupy or conduct business in any
PacifiCare Service Location beyond the expiration or termination of the lease
under which PacifiCare holds such PacifiCare Service Location.

      (44) Supplier shall not use any PacifiCare Service Location for any
purpose or activity which has not been specifically provided for or authorized
under the Agreement or these Rules and Regulations.

      (45) Supplier shall not cause or permit any hazardous materials to be
brought upon, kept or used in or about any PacifiCare Service Location.

      (46) To prevent the generation, growth, or deposit of any mold, mildew,
bacillus, virus, pollen or other micro-organisms (collectively, "Biologicals")
and the deposit, release or circulation of any indoor contaminants, including
emissions from paint, carpet and drapery treatments, cleaning, maintenance and
construction materials and supplies, pesticides, pressed wood products,
insulation, and other materials and products (collectively with Biologicals,
"Contaminants"), that could adversely affect the health, safety or welfare of
any tenant, employee or other occupant of the Building or their invitees,
Supplier shall, at Supplier's sole cost and expense, at all times (i) operate
the Premises in a manner consistent with preventing or minimizing the
generation, growth, circulation, release or deposit of any Contaminants, and
(ii) maintain, operate and repair each PacifiCare Service Location in such a
manner to prevent or minimize the accumulation of stagnant water and moisture in
planters, kitchen appliances and vessels, carpeting, insulation, water coolers
and any other locations where stagnant water and moisture could accumulate, and
(iii) otherwise maintain, operate and repair the Premises to prevent the
generation, growth, deposit, release or circulation of any Contaminants.

         (47) Supplier shall permit PacifiCare or its landlord to enter any
PacifiCare Service Location at reasonable times upon prior notice (except that
in the case of emergencies no prior notice shall be required) to examine such
location, and to show the same to prospective purchasers, lenders or tenants, to
make such

                                                                     Page 5 of 6
PacifiCare/Keane Confidential
<PAGE>
repairs, alterations, additions or improvements as may be required in
connection with the development or maintenance of said location, without the
same constituting an eviction of Supplier or a trespass.

PacifiCare/Keane Confidential
                                                                     Page 6 of 6
<PAGE>

                                  SCHEDULE 7.1

                              Assigned Agreements

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                  SCHEDULE 7.2

                               Managed Agreements

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

CONFIDENTIAL

                     PACIFICARE AND KEANE SERVICES AGREEMENT

================================================================================
                             SERVICE LEVEL SCHEDULE
================================================================================

                                   SCHEDULE 8

                              [LOGO] PACIFICARE(R)
                                  Information Services

Confidential                         Page 1
<PAGE>

<TABLE>
<CAPTION>
                                TABLE OF CONTENTS
<S>                                                                           <C>
I.    GENERAL PROVISIONS:...................................................   4

   A.    GENERAL:...........................................................   4

   B.    ATTACHMENTS:.......................................................   5

   C.    REPORTING:.........................................................   5

   D.    DEFINITIONS:.......................................................   6

   E.    NOTICE REQUIREMENTS FOR ADDITIONS, DELETIONS AND MODIFICATIONS:....   8

   F.    SERVICE LEVEL CREDITS:.............................................   8

   G.    EARN BACK:.........................................................  10

   H.    ADDITIONS AND DELETIONS OF PERFORMANCE CATEGORIES:.................  11

   I.    ADDITIONS AND DELETIONS OF SERVICE LEVELS:.........................  11

   J.    MODIFICATIONS OF SERVICE LEVEL CREDIT ALLOCATION PERCENTAGES
          FOR CRITICAL SERVICE LEVELS:......................................  13

   K.    CRITICAL DELIVERABLES:.............................................  14

   L.    COMMENCEMENT OF OBLIGATIONS:.......................................  14

   M.    COOPERATION:.......................................................  14

   N.    [   ***   ] - CRITICAL SERVICE LEVELS:.............................  15

   O.    ROOT-CAUSE ANALYSIS:...............................................  15

   P.    MEASURING & MONITORING TOOLS:......................................  16

   Q.    EXCEPTIONS:........................................................  16

   R.    EXCEPTIONS - MISSING SOURCE CODE...................................  17

   S.    EXCLUSIONS:........................................................  18

   T.    BALANCED SCORECARD:................................................  18

   U.    VOLUME MEASUREMENT.................................................  18

II.   CRITICAL SERVICE LEVELS:..............................................  19

   A.    PERFORMANCE CATEGORY -CRITICAL APPLICATION AVAILABILITY:...........  19

   B.    PERFORMANCE CATEGORY- APPLICATION AVAILABILITY:....................  19

   C.    PERFORMANCE CATEGORY - CRITICAL APPLICATION RESPONSE TIME:.........  19

   D.    PERFORMANCE CATEGORY - APPLICATION RESPONSE TIME:..................  19

   E.    PERFORMANCE CATEGORY - CRITICAL PROCESSES:.........................  19

   F.    PERFORMANCE CATEGORY - PROJECTS:...................................  20

   G.    OTHER APPLICATION SERVICE LEVELS:..................................  21
</TABLE>

                                  Page 2 of 36              [LOGO] PACIFICARE(R)
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<TABLE>
<S>                                                                           <C>
III.  CRITICAL DELIVERABLES:................................................  22

   A.    POLICY AND PROCEDURE MANUAL DRAFT:.................................  22

   B.    REPORT FORMAT DRAFT:...............................................  22

   C.    ANNUAL PLAN:.......................................................  22

   D.    PACIFICARE IS CUSTOMER SATISFACTION SURVEY DRAFT QUESTIONS:........  22

   E.    PACIFICARE IS CUSTOMER SATISFACTION SURVEY KEY MEASUREMENTS PLAN:..  22

   F.    ACHIEVEMENT OF CMM LEVEL 3 FOR SUPPLIER SOFTWARE DEVELOPMENT
          ORGANIZATIONS:....................................................  23

IV.   KEY MEASUREMENTS:.....................................................  24

   A.    PERFORMANCE CATEGORY- APPLICATION AVAILABILITY:....................  24

   B.    PERFORMANCE CATEGORY APPLICATION RESPONSE TIME:....................  24

   C.    PERFORMANCE CATEGORY  - APPLICATION PERFORMANCE DEGRADATION:.......  24

   D.    PERFORMANCE CATEGORY CRITICAL PROCESSES:...........................  24

   E.    OTHER APPLICATION SERVICE LEVELS:..................................  25

   F.    PERFORMANCE CATEGORY - PROBLEM RESPONSE AND RESOLUTION:............  25

   G.    PERFORMANCE CATEGORY - APPLICATION MANAGEMENT:.....................  27

   H.    PERFORMANCE CATEGORY - APPLICATIONS PERFORMANCE:...................  28

   I.    PERFORMANCE CATEGORY - DISASTER RECOVERY:..........................  29

V.    DEFINITION OF TERMS USED IN SERVICE LEVELS............................  31
</TABLE>

                                  Page 3 of 36              [LOGO] PACIFICARE(R)
<PAGE>

                             SERVICE LEVEL SCHEDULE

I.    GENERAL PROVISIONS:

A.    GENERAL:

      This Service Level Schedule, including any attachments hereto, (this
      "SCHEDULE") is a schedule to that certain Information Technology Services
      Agreement entered into and made to be effective as of January 12, 2002 by
      and between PacifiCare and Supplier (the "AGREEMENT").

      In the event of any conflict, ambiguity or inconsistency between this
      Schedule and the provisions in the body of the Agreement, the provisions
      in the body of the Agreement shall prevail.

      This Schedule sets forth certain quantitative Critical Service Levels, Key
      Measurements and Critical Deliverables against which Supplier's
      performance shall be measured and does not replace any requirements or
      obligations of Supplier to provide the Services or any subset thereof.
      Supplier shall perform the Services at or above the levels of performance
      indicated in this Schedule. Critical Service Levels are identified in
      Section II below. Critical Deliverables are identified in Section III
      below. Key Measurements are described in Section IV below.

      As of the Cutover Date, Supplier shall perform the Services consistent
      with the documented levels of performance, measured for [...***...]
      consecutive full months that have been achieved by PacifiCare immediately
      prior to the Cutover Date. In the event that PacifiCare does not have
      documented levels of performance, Supplier shall perform the measurements
      in accordance with Section I.I.1. During such measurement period, Service
      Level Credits shall not apply.

      In the case of Services that do not have corresponding Service Levels
      specified in this Schedule as of the Cutover Date, Supplier shall provide
      such Services to PacifiCare Entities at least at the same level of
      performance (including the degree of accuracy, quality, completeness,
      responsiveness, etc.) as such Service was provided by or for PacifiCare
      prior to the Cutover Date or at the appropriate Service Level as shall be
      determined in accordance with the process set forth herein.

      New Performance Categories, Critical Service Levels and Key Measurements
      may be added or substituted by PacifiCare as specified in this Schedule
      during the Term and while Supplier retains responsibility for maintaining
      the PacifiCare Software during the Termination Assistance Period in order
      to achieve a fair, accurate and consistent measurement of Supplier's
      performance of the Services. For example, such additions or substitutions
      may occur in conjunction with changes to the environment and the
      introduction of New Equipment or means of service delivery; the Parties
      agree that in the event such New Equipment or such means of service
      delivery is a replacement or upgrade of existing technology, there shall
      be a presumption of equivalent or improved performance.

                                  Page 4 of 36              [LOGO] PACIFICARE(R)
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

B.    ATTACHMENTS:

      The following Service Level Attachments are attached hereto and are hereby
      incorporated by reference:

            SLA-1       Service Level Matrix

            SLA-2       Service Level Outcome Examples

            SLA-3       Balanced Scorecard

            SLA-4       Pre-approved Measuring Tools and Methodologies for
                        Critical Service Level Measurements

            SLA-5       Application Summaries

C.    REPORTING:

      Unless otherwise specified in this Service Level Schedule, Supplier shall
      measure and report Supplier's performance with respect to each Critical
      Service Level and Key Measurement on a monthly basis. On or before the
      fifteenth (15th) of each month of the Term and the Termination Assistance
      Period, Supplier shall provide to PacifiCare a Service Level Report of
      Supplier's performance with respect to the applicable Service Levels for
      the preceding month, including Supplier's actual performance, any Service
      Level Defaults that occurred and Service Level Credits that accrued during
      the month. Supplier shall provide the Service Level Reports in hard copy
      and soft-copy formats; formats can include Microsoft Office Word, Excel
      and any other format as reasonably requested by PacifiCare. Supplier shall
      include in the Service Level Reports sufficient details of Supplier's
      performance of the Services to allow verification of Supplier's
      performance and compliance with the Critical Service Levels, Key
      Measurements and Critical Deliverables, which such information shall be in
      machine-readable form, as specified by PacifiCare, suitable for use on a
      personal computer. All information supplied as part of and in connection
      with the Service Level Reports shall be Confidential Information of
      PacifiCare. Each Service Level Report shall include total invoice costs
      (including Base Fees and Variable Fees), for the month to which the
      Service Level Report applies, which may be in summary form. For example,
      the Service Level Report for Supplier's performance in August shall
      include a summary of the invoice for the Base Fees and Variable Fees
      applicable to August. Each Service Level Report shall contain a summary
      page that indicates the total amount of Service Level Credits incurred
      during the previous month and a running total of all Service Level Credits
      and Deliverable Credits accrued or incurred during the then-current
      Contract Year.

                                  Page 5 of 36              [LOGO] PACIFICARE(R)
<PAGE>

D.    DEFINITIONS:

      Terms used herein with initial capital letters shall have the respective
      meanings set forth in the Agreement, or, for those terms that are not
      defined in the Agreement, the meanings set forth in this Schedule in
      Section V and as follows:

            a.    ALLOCATION OF POOL PERCENTAGE shall have the meaning set forth
                  in Section I.F.1 of this Service Level Schedule. The total of
                  all Allocation of Pool Percentages shall not exceed the Pool
                  Percentage Available for Allocation.

            b.    APPLICATION means PacifiCare Software, Supplier Software or
                  any particular Component thereof, as applicable.

            c.    AT RISK AMOUNT shall mean, for any month during the Term and
                  Termination Assistance Period, [...***...] percENT
                  ([...***...]%) of the monthly Fees, which is the amount that
                  Supplier shall have at risk for Service LeVEL Credits as set
                  forth in Service Level Attachment SLA-1.

            d.    CONTRACT YEAR is defined in the Agreement.

            e.    CRITICAL DELIVERABLES shall mean those deliverables performed
                  on a one-time basis, for which a Deliverable Credit is payable
                  in accordance with Section I.K of this Service Level Schedule
                  and described in Section III of the Service Level Schedule if
                  Supplier fails to deliver such deliverables. Critical
                  Deliverables are identified in Service Level Attachment SLA-1.
                  Critical Deliverables are not Critical Service Levels.

            f.    CRITICAL SERVICE LEVELS shall mean those Service Levels
                  established under this Service Level Schedule for which a
                  Service Level Credit may accrue as set forth in Section I.F,
                  subject to earn back provisions of Section I.G. Critical
                  Service Levels are identified in Service Level Attachment
                  SLA-1 and are described in Section II of this Service Level
                  Schedule. Each Critical Service Level has an Expected Service
                  Level and a Minimum Service Level associated with it unless
                  otherwise specified.

            g.    DELIVERABLE CREDITS shall have the meaning set forth in
                  Section I.K of this Service Level Schedule.

            h.    EXPECTED SERVICE LEVEL shall mean the desired level of
                  performance for a Critical Service Level or a Key Measurement,
                  as set forth in Service Level Attachment SLA-1.

            i.    EXPECTED SERVICE LEVEL DEFAULT shall mean Supplier's level of
                  performance for a particular Critical Service Level fails to
                  meet the applicable Expected Service Level (but does not fail
                  to meet the applicable Minimum Service

                                  Page 6 of 36              [LOGO] PACIFICARE(R)
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                  Level) as specified in this Service Level Schedule, and has
                  failed to meet such Expected Service Level [...***...]

            j.    KEY MEASUREMENTS shall mean those Service Levels for which no
                  Service Level Credit is payable, but which are meaningful to
                  PacifiCare Entities' business operations, and are described in
                  Section IV of this Service Level Schedule. Each Key
                  Measurement has an Expected Service Level and a Minimum
                  Service Level associated with it unless otherwise specified.
                  It is the intent of the Parties that all Key Measurements
                  shall be quantifiable, measurable and objective.

            k.    MEASUREMENT WINDOW shall mean the time during which
                  performance of a Service Level, Application, or other element
                  of the Services shall be measured, which such time shall
                  exclude approved Scheduled Downtime.

            l.    MINIMUM SERVICE LEVEL shall mean the minimum level of
                  performance set forth in Service Level Attachment SLA-1 with
                  respect to each Critical Service Level or Key Measurement.

            m.    MINIMUM SERVICE LEVEL DEFAULT shall mean Supplier's level of
                  performance for a particular Critical Service Level fails to
                  meet the applicable Minimum Service Level at any time.

            n.    MONTHLY FEES shall mean the Base Fees and Variable Fees for a
                  calendar month.

            o.    OTHER SUPPLIER(S) shall mean all third parties, excluding
                  Supplier, contracted by PacifiCare.

            p.    PERFORMANCE CATEGORY shall mean a grouping of Critical Service
                  Levels as set forth on Service Level Attachment SLA-1.
                  Critical Deliverables do not constitute a Performance
                  Category.

            q.    POOL PERCENTAGE AVAILABLE FOR ALLOCATION shall mean
                  [...***...] percent ([...***...]%) of the At Risk Amount.

            r.    SERVICE LEVEL CREDIT shall have the meaning set forth in
                  Section I.F.1 of this Schedule.

            s.    SERVICE LEVEL CREDIT ALLOCATION PERCENTAGE shall have the
                  meaning set forth in Section I.F.1 of this Service Level
                  Schedule. The sum of the Service Level Credits Allocation
                  Percentages shall not exceed [...***...] for each Performance
                  Category.

            t.    SERVICE LEVEL DEFAULT shall mean a Minimum Service Level
                  Default or an Expected Service Level Default.

                                  Page 7 of 36              [LOGO] PACIFICARE(R)
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

            u.    SERVICE LEVEL REPORT shall mean the monthly report of
                  Supplier's performance with respect to the Service Levels set
                  forth in this Service Level Schedule and any Service Level
                  Defaults and Service Level Credits attributable to Supplier's
                  performance during the preceding month, as set forth in
                  Section I.C. of this Service Level Schedule.

            v.    SIX-MONTH MEASUREMENT PERIOD shall mean, if Section I.I.1 of
                  this Schedule is used to establish the Expected Service Level
                  and Minimum Service Level commitments, the six (6) consecutive
                  months of measurements immediately preceding the month in
                  which PacifiCare provided notice to Supplier.

            w.    UNRELIEVED SERVICE LEVEL CREDITS shall have the meaning set
                  forth in Section I.G.4 of this Service Level Schedule.

            x.    YEARLY PERFORMANCE AVERAGE shall have the meaning set forth in
                  Section I.G.1.b of this Service Level Schedule.

E.    NOTICE REQUIREMENTS FOR ADDITIONS, DELETIONS AND MODIFICATIONS:

      PacifiCare shall send notice to Supplier at least [...***...] prior to the
      date that additions or deletions to Performance Categories, or additions
      or deletions to Service Levels (which include Critical Service Levels and
      Key Measurements), or modifications to Service Level Credit Allocation
      Percentages for any Critical Service Levels are to be effective, provided
      that PacifiCare may send only [...***...] such notice (which notice may
      contain multiple changes) each calendar quarter.

F.    SERVICE LEVEL CREDITS:

      In the event of a Service Level Default, Supplier shall provide PacifiCare
      credits as calculated below.

            1.    Service Level Attachment SLA-1 sets forth the information
                  required to calculate the credits that shall accrue to
                  PacifiCare (and that Supplier shall credit to PacifiCare as
                  set forth in Section I.G.4) in the event of a Service Level
                  Default ("SERVICE LEVEL CREDIT"). For each Service Level
                  Default, subject to Section I.G below, a Service Level Credit
                  that shall accrue to PacifiCare and shall be computed in
                  accordance with the following formula:

                  Service Level Credit = A x B x C

                  Where:

                  A = The Allocation of the Pool Percentage specified for the
                  Performance Category in which the Service Level Default
                  occurred as shown in Service Level Attachment SLA-1 (the
                  "ALLOCATION OF POOL PERCENTAGE").

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                  B = The percentage of the Allocation of Pool Percentage
                  allocated to the Critical Service Level in which the Service
                  Level Default occurred as shown in Service Level Attachment
                  SLA-1 (the "SERVICE LEVEL CREDIT ALLOCATION PERCENTAGE")

                  C = At Risk Amount

                  For example, assume that Supplier fails to meet the Minimum
                  Service Level for a Critical Service Level, and that the
                  Supplier's total Monthly Fees for the month in which the
                  Service Level Default occurred were [...***...].

                  Additionally, assume that the Allocation of Pool Percentage
                  for the Performance Category of such Critical Service Level is
                  [...***...]% and that its Service Level Credit Allocation
                  Percentage is [...***...]%. The Service Level Credit due to
                  PacifiCare for such Service Level Default would be computed as
                  follows:

                  A = [...***...]% (the Allocation of Pool Percentage),

                  Multiplied by

                  B = [...***...]% (the Service Level Credit Allocation
                  Percentage),

                  Multiplied by

                  C = [...***...] percent [...***...]%) of [...***...],
                  Supplier's Fees for the month during which the Service LeveL
                  Default occurred).

                  [...***...] (the amount of the Service Level CredIT)

            2.    If [...***...] Or more than [...***...] Service Level Default
                  has occurred in a single month where the Supplier Has failed
                  to meet more than [...***...] Minimum Service Level, the sum
                  of the corresponding Service Level Credit(S) shall accrue to
                  PacifiCare. For clarity, a single Service Level Default shall
                  not be double-counted as both a Minimum Service Level failure
                  and an Expected Service Level failure.

            3.    In no event shall the amount of Service Level Credits that
                  accrue to PacifiCare with respect to all Service Level
                  Defaults occurring in a single month exceed, in total, the At
                  Risk Amount.

            4.    Supplier shall notify PacifiCare if PacifiCare accrues a
                  Service Level Credit, which notice shall be included in the
                  Service Level Reports described in Section I.C. The Service
                  Level Reports shall also describe any failure to meet Key
                  Measurements for the month.

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G.    EARN BACK:

      Supplier shall have earn back opportunities with respect to Service Level
      Credits as follows:

            1.    Within [...***...] after the last day of each Contract Year,
                  Supplier shall provide a report to PacifiCare that shall
                  include, with respect to each Critical Service Level for which
                  there was a Service Level Default during the preceding
                  Contract Year, the following:

                  a.    Statistics on Supplier's monthly performance during the
                        preceding Contract Year;

                  b.    The average of Supplier's monthly performances in that
                        Critical Service Level during the preceding Contract
                        Year ("YEARLY PERFORMANCE AVERAGE"); and

                  c.    The total amount of Service Level Credits accrued to
                        PacifiCare for Service Level Defaults.

            2.    If during the preceding Contract Year Supplier achieved a
                  Yearly Performance Average in a Critical Service Level that
                  was greater than or equal to the Expected Service Level in
                  effect for such Critical Service Level during the preceding
                  year, then Supplier shall be relieved from paying any Service
                  Level Credits that accrued during the preceding Contract Year
                  for such Critical Service Level.

            3.    If during the preceding Contract Year PacifiCare deletes a
                  Critical Service Level, then Supplier shall be relieved from
                  paying Service Level Credits assessed during the preceding
                  Contract Year for Service Level Defaults in that Critical
                  Service Level only for the portion of the Contract Year during
                  which the deletion was effective.

            4.    Supplier shall pay to PacifiCare the amounts of any Service
                  Level Credits accrued to PacifiCare for which Supplier is not
                  relieved pursuant to Section I.G.2 or I.G.3 above for each
                  Contract Year ("Unrelieved Service Level Credits") as a credit
                  to PacifiCare on the monthly invoice reflecting charges to
                  PacifiCare for the first month of the Contract Year
                  immediately following the Contract Year in which such Service
                  Level Credits accrued. In the case where there shall be no
                  further invoices, Supplier shall pay the accrued amount of the
                  Unrelieved Service Level Credits to PacifiCare within
                  [...***...] days after the end of the last month of the Term.

            5.    If the Agreement is terminated prior to the end of the Initial
                  Term, any Extension Period or any Renewal Term, the foregoing
                  process shall be undertaken with respect to the portion of the
                  Contract Year during which the Agreement was in effect.

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H.    ADDITIONS AND DELETIONS OF PERFORMANCE CATEGORIES:

      PacifiCare may add or delete Performance Categories by sending notice as
      described in Section I.E above. In no event may: (1) the sum of the
      Allocations of Pool Percentage for all the Performance Categories exceed
      the Pool Percentage Available for Allocation, or (2) the sum of the
      Service Level Credit Allocation Percentages for all Critical Service
      Levels within a Performance Category exceed [...***...].

I.    ADDITIONS AND DELETIONS OF SERVICE LEVELS:

      PacifiCare may add or delete Service Levels pursuant to the following
      provisions. PacifiCare may require the addition of Services Levels,
      including Service Levels required to address Supplier's performance with
      respect to New Services, Services for which a Service Level does not exist
      but for which PacifiCare requires a Service Level and for any changes in
      Supplier's performance that can reasonably be expected due to the addition
      or utilization of new, updated, upgraded or modified Equipment, Systems,
      Applications or other technology.

      1.    ADDITIONS:

            PacifiCare may add Service Levels in accordance with this Section
            I.I.1 and by providing notice in accordance with Section I.E.
            Expected Service Levels and Minimum Service Level commitments
            associated with added Service Levels shall be computed as follows:

            a.    Where measurements exist for at least [...***...] for a
                  particular Service that is being provided by Supplier, the
                  Parties agree that the Expected Service Level shall be defined
                  as the average performance indicated by such measurements for
                  the [...***...] Measurement Period and that the Minimum
                  Service Level shall be defined as the lowest(1) months
                  measurement achieved during the [...***...] Measurement
                  Period, or

            b.    Where less than [...***...] consecutive [...***...] of
                  measurements (or no measurements) exist for a particular
                  Service that is being provided by Supplier, the Parties shall
                  attempt in good faith to agree on an Expected

----------
[...***...]

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                  Service Level and a Minimum Service Level commitment using
                  industry standard measures or third party advisory services
                  [...***...], or

            c.    Where less than [...***...] consecutive [...***...] of
                  measurements (or no measurements) exist for a particular
                  Service that is being provided by Supplier, and the Parties
                  fail to agree on an Expected Service Level and a Minimum
                  Service Level commitment using Section I.I.1.b above, the
                  Parties shall do the following:

                  1)    Supplier shall begin providing monthly measurements
                        within [...***...]

                  2)    After [...***...] or more measurements have been taken
                        (or should have been taken per Section I.I.1.c(1) above
                        and if not so measured; constructed as described in
                        Section I.I.1.c(2)(a) below), PacifiCare may at any time
                        in writing request that Section I.I.1.a above be used to
                        establish the Expected Service Level and Minimum Service
                        Level commitments.

                        (a)    If Supplier is responsible for measuring actual
                               service levels for [...***...] and fails to
                               provide one (1) or more measurements during the
                               [...***...] Measurement Period such that
                               [...***...] consecutive measurements are not
                               available, the missing measurement(s) shall be
                               constructed according to the following;
                               [...***...]

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                        (b)    [...***...]

                  2.    DELETIONS:

                  PacifiCare may delete Service Levels by sending notice to
                  Supplier in accordance with Section I.E.

                  3.    IMPACT OF ADDITIONS AND DELETIONS OF CRITICAL SERVICE
                        LEVELS ON SERVICE LEVEL CREDIT ALLOCATION PERCENTAGES:

                  When adding or deleting a Critical Service Level, PacifiCare
                  shall modify the Service Level Credit Allocation Percentages
                  for the Critical Service Levels within the Performance
                  Category such that the total Service Level Credit Allocation
                  Percentages for all Critical Service Levels within the
                  Performance Category equals [...***...]. If PacifiCare adds a
                  Critical Service Level in accordance with Section I.I.1 above,
                  but does not modify the Service Level Credit Allocation
                  Percentages for the Critical Service Levels within the
                  applicable Performance Category under this Section I.I.3,
                  then, until such time as PacifiCare so modifies such Service
                  Level Credit Allocation Percentages, the Service Level Credit
                  Allocation Percentage for such added Critical Service Level
                  shall be zero (0).

J.    MODIFICATIONS OF SERVICE LEVEL CREDIT ALLOCATION PERCENTAGES FOR CRITICAL
      SERVICE LEVELS:

      PacifiCare may modify the Service Level Credit Allocation Percentages for
      any Critical Service Levels within the Performance Category by sending
      notice in accordance with Section I.E. PacifiCare shall modify the Service
      Level Credit Allocation Percentages for

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      [...***...] or more of the Critical Service Levels within the Performance
      Category such that the sum of the Service Level Credit Allocation
      Percentages for all Critical Service Levels within the Performance
      Category equals [...***...].

K.    CRITICAL DELIVERABLES:

      Service Level Attachment SLA-1 sets forth the credits that shall be
      payable by Supplier to PacifiCare in the event Supplier fails to deliver
      any of the Critical Deliverable by the time specified for the delivery of
      such Critical Deliverable in Service Level Attachment SLA-1 ("DELIVERABLE
      CREDITS"). [...***...] The total amount of Deliverable Credits that
      Supplier incurs each month shall be reflected on the first monthly invoice
      after the month during which the Deliverable Credits accrued (e.g., the
      amount of Deliverable Credits payable for failure to deliver any Critical
      Deliverable(s) in August shall be credited against the September invoice
      for Base Fees). Unlike Service Level Credits, Deliverable Credits shall be
      shown in each monthly invoice as an actual credit to the charges
      [...***...]

L.    COMMENCEMENT OF OBLIGATIONS:

      Except as provided in the Agreement, the obligations set forth in this
      Service Level Schedule shall commence on the Cutover Date or as otherwise
      specified in Service Level Attachment SLA-1 referencing the column
      "cutover + mos**". The number used in the column "cutover +mos**" are in
      the format X where "X" represents the number of months after Cutover Date
      that the Supplier shall be responsible to provide measurement data in
      support of the Critical Service Level and Supplier shall be responsible
      for Service Level Credits for any failures to attain the Critical Service
      Level. In the event any Service Levels are added pursuant to Section I.I.1
      above, Supplier's obligations shall commence at the time that the Expected
      Service Level or Minimum Service Level, as applicable, has been defined
      for the added Service Level.

M.    COOPERATION:

      Without limiting or altering any of Supplier's obligations as set forth in
      Section 13.2 of the Agreement, Supplier shall provide a single point of
      contact for the prompt resolution of all Service Level Defaults and all
      failures to provide high quality Services to PacifiCare, regardless of
      whether the reason for such Service Level Defaults, or failure to provide
      high quality outsourcing Services to PacifiCare, was caused by Supplier or
      Other Suppliers.

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N.    [...***...] - CRITICAL SERVICE LEVELS:

      The Parties agree to the concept of [...***...] Critical Service Levels
      shall be [...***...] at the end of each [...***...] month period following
      the commencement of obligations dates specific to each Critical Service
      Level as described in Section I.L and below:

      1.    [...***...]

      2.    [...***...]

      3.    [...***...]

      4.    [...***...]

      5.    In no event shall any adjustment of any Critical Service Level
            result in any Expected Service Level or Minimum Service Level being
            reset below the level of the applicable Expected Service Level or
            Minimum Service Level prior to the adjustment.

O.    ROOT-CAUSE ANALYSIS:

      If a problem is defined as Severity Level 0 or 1 for any Service Level,
      then Supplier shall perform root-cause analysis for such failure as
      described in Section 8.4 of the Agreement.

      Without limiting or altering any of the Supplier's obligations pursuant to
      Section 8 of the Agreement, Supplier's root-cause analysis for each
      Service Level Default shall determine a single root-cause for each such
      Service Level Default. If a single root-cause incident results in more
      than [...***...] Service Level Default, then PacifiCare shall select
      [...***...] Service Level Default for which PacifiCare shall be entitled
      to receive a Service Level Credit. PacifiCare shall not be entitled to a
      Service Level Credit for each such Service

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      Level Default attributable to each root-cause incident. [...***...]

      With regards to root cause analysis and Service Level Defaults, the term
      NICE refers to a group of Applications consisting of NICE Claims, NICE
      Membership - Commercial, NICE Membership - Secure and NICE Provider
      Contracts.

      PacifiCare reserves the right to add, delete or change the Applications
      within each grouping providing that the Application being substituted is
      part of the existing suite and currently exists in Key Measurements.

P.    MEASURING & MONITORING TOOLS:

      As of the Cutover Date, the measuring tools and methodologies set forth in
      Service Level Attachment SLA-4 to this Service Level Agreement represent
      acceptable tools and methodologies for measuring the Critical Service
      Levels. If there are any Critical Service Levels for which the measuring
      tools and methodologies have not been agreed upon by PacifiCare and
      Supplier and included in Attachment SLA-4 and Supplier fails to propose a
      measuring tool or methodology for such Critical Service Level that is
      acceptable to PacifiCare prior to the date upon which Supplier shall be
      responsible for measuring such Service Level performance and Service Level
      Credits due for applicable Service Level Defaults, then such failure to
      provide an acceptable measuring tool and methodology shall be deemed a
      Minimum Service Level Default for the applicable Critical Service Level
      until Supplier proposes and implements an acceptable measuring tool.

      Tools for new Critical Service Levels shall be implemented according to
      the Change Management Procedures. If after the Cutover Date or the
      implementation of measuring tools methodologies for new Critical Service
      Levels Supplier desires to use different measuring and tools or
      methodologies for a Critical Service Level, then Supplier shall provide
      notice to PacifiCare, in which event the Parties shall reasonably adjust
      the measurements as necessary to account for any increased or decreased
      sensitivity in such new tools or methodologies. If the Parties cannot
      agree on the required adjustment, Supplier shall continue to use the
      measuring tools and methodologies that had been initially agreed to by the
      Parties.

Q.    EXCEPTIONS:

      Supplier shall not be responsible for a failure to meet any Service Level
      solely to the extent that such failure is directly attributable to any of
      the following:

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      1.    PacifiCare's breach of this Agreement, or the failure of a
            PacifiCare Agent to perform according to the terms of such
            PacifiCare Agent's agreement with PacifiCare, or the acts of
            PacifiCare or of a PacifiCare Agent that directly cause Supplier's
            failure to perform, provided that, in each case, Supplier used all
            reasonable efforts to meet the Service Levels as specified.

      2.    Service or resource reductions requested or approved by PacifiCare
            and agreed to by the Parties through the Change Control Procedures;
            provided that Supplier has previously notified PacifiCare in writing
            prior to the execution of such Change Control Procedures that the
            implementation of such request would result in such failure to meet
            the Service Level.

R.    EXCEPTIONS - MISSING SOURCE CODE

      1.    [...***...]

      2.    [...***...]

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S.    EXCLUSIONS:

      [...***...]

T.    BALANCED SCORECARD:

      [...***...]

U.    VOLUME MEASUREMENT

      [...***...]

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II.   CRITICAL SERVICE LEVELS:

This section sets forth descriptions of the Critical Service Levels. The Minimum
Service Levels and the Expected Service Levels associated with the following
Critical Service Levels are set forth in Service Level Attachment SLA-1.

A.    PERFORMANCE CATEGORY -CRITICAL APPLICATION AVAILABILITY:

      Supplier shall measure and report the Availability of each Critical
      Application identified in Service Level Attachment SLA-1 ("CRITICAL
      APPLICATION AVAILABILITY"), which such Critical Application Availability
      shall constitute a Critical Service Level.

B.    PERFORMANCE CATEGORY- APPLICATION AVAILABILITY:

      Supplier shall measure and report the Availability of each Application
      identified in Service Level Attachment SLA-1 ("APPLICATION AVAILABILITY"),
      which such Application Availability shall constitute a Critical Service
      Level.

C.    PERFORMANCE CATEGORY - CRITICAL APPLICATION RESPONSE TIME:

      Supplier shall measure and report the Response Time of each Critical
      Application identified in Service Level Attachment SLA-1 ("CRITICAL
      APPLICATION RESPONSE TIME"), which such Critical Application Response Time
      shall constitute a Critical Service Level.

D.    PERFORMANCE CATEGORY - APPLICATION RESPONSE TIME:

      Supplier shall measure and report the Response Time of each Application
      identified in Service Level Attachment SLA-1 ("APPLICATION RESPONSE
      TIME"), which such Application Response Time shall constitute a Critical
      Service Level.

E.    PERFORMANCE CATEGORY - CRITICAL PROCESSES:

            1.    The Batch Schedule Completion On-Time Rate

                  The Batch Schedule Completion On-Time Rate calculation
                  includes production of updated files and appropriate reports,
                  produced in a calendar month. The list of all Critical Batch
                  Jobs to be tracked in this performance category can be found
                  on the SLA-1 under the title Critical Batch Jobs and shall
                  herein be known as ("SCHEDULED BATCH JOBS").

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                  [...***...]

                  With respect to ongoing Scheduled Batch Jobs scheduling
                  requirements, Supplier shall be responsible to make updates to
                  the job schedules as required and review such updates with
                  PacifiCare no less frequently than [...***...]

                  For the avoidance of doubt, if the total number of Scheduled
                  Batch Jobs per Application scheduled in [...***...] iS less
                  than [...***...], then:

                  The compliance calculation described in this Section shall be
                  calculated and reported, and a failure to meet the Expected
                  Service Level shall occur only if (a) the total number of
                  Scheduled Batch Jobs per Application scheduled in that
                  [...***...], minus (b) the total number of Scheduled Batch
                  Jobs successfully completed on-time per Application, is
                  greater than [...***...]. A failure to meet the Minimum
                  Service Level shall occur only if (y) the total number of
                  Scheduled Batch Jobs per Application scheduled in that
                  [...***...], minus (z) the total number of Scheduled Batch
                  Jobs per Application successfully completed on-time, produced
                  in [...***...] is greater than [...***...]

F.    PERFORMANCE CATEGORY - PROJECTS:

      General. Supplier shall manage all Projects with respect to Project
      Deliverables so as to meet or be better than the Service Levels set forth
      in Service Level Attachment SLA-1.

                  1.    PERCENT OF MAJOR PROJECT SCHEDULE OVERRUNS

                  On a monthly basis, beginning one full month (1) after Cutover
                  Date, Supplier shall provide a report for each Major Project
                  promoted into production during the previous month that
                  summarizes actual attainment with respect to the agreed
                  scheduled implementation date, as modified to reflect changes
                  agreed to in writing by PacifiCare and amended through the
                  Change Management Procedures. With respect to Major Projects
                  with schedules estimated prior to the Cutover Date (i.e., not
                  by Supplier), Supplier shall review these Major Projects.
                  [...***...]

                  Percent of Major Project Schedule Overruns shall be calculated
                  [...***...]

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                  [...***...]

                  2.    PROJECTS DELIVERED TO BUDGET WITHOUT MORE THAN
                        [...***...] PERCENT ([...***...]%) VARIANCE

                  Each month on a rolling, twelve-month basis, Supplier shall
                  provide a report for each Project (Projects with detailed
                  estimates completed prior to the Cutover Date shall be
                  validated during transition) completed during the previous
                  twelve-month period. The report shall detail the variance
                  between the actual cost and the approved detailed Project
                  estimate, including those Projects modified to reflect changes
                  agreed to in writing by Client and amended through the Change
                  Management Procedures. With respect to Projects with schedules
                  estimated prior to the Cutover Date (i.e., not by Supplier),
                  Supplier shall review these Projects. [...***...]

                  Projects Delivered to Budget shall be calculated as
                  [...***...]

G.    OTHER APPLICATION SERVICE LEVELS:

            1.    NICE CLAIMS AVERAGE DAILY VOLUME

                  Supplier shall perform capacity planning and analysis for
                  applications supporting NICE claims. Based on these plans and
                  analysis, Supplier shall propose recommendations to improve
                  the optimization or software replacement of NICE claims
                  applications software. The implementation of any such
                  recommendations may be treated as a Project and shall be
                  subject to PacifiCare's prior approval and prioritization.

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III.  CRITICAL DELIVERABLES:

If Supplier fails to deliver to PacifiCare any Critical Deliverables as
described below, in format and content acceptable to PacifiCare by the date
identified for such Critical Deliverable, Supplier shall provide PacifiCare,
each month, a credit as set forth in Service Level Attachment SLA-1 until such
Critical Deliverable is provided to PacifiCare.

A.    POLICY AND PROCEDURE MANUAL DRAFT:

      Supplier shall deliver to PacifiCare and Infrastructure Supplier the draft
      of the portion of the Policy and Procedures Manual that pertains to the
      Services and other functions and aspects of Supplier's performance, in
      conformance with the requirements described in Schedule 13.3 (Policy and
      Procedures Manual).

B.    REPORT FORMAT DRAFT:

      Supplier shall deliver to PacifiCare and Infrastructure Supplier the draft
      of the portion of the Policy and Procedures Manual that pertains to the
      Services and other functions and aspects of Supplier's performance, in
      conformance with the requirements described in Schedule 3.8(b) Reports.

C.    ANNUAL PLAN:

      Supplier shall deliver the first annual plan as set forth in Section
      3.8(a) of the Agreement.

D.    PACIFICARE IS CUSTOMER SATISFACTION SURVEY DRAFT QUESTIONS:

      Supplier shall provide a draft of customer satisfaction survey questions
      with regards to the service the Supplier provides. This draft is due
      [...***...] following the Effective Date. PacifiCare shall review the
      draft and blend the questions into the annual IS Customer Satisfaction
      Survey conducted by an independent third party.

E.    PACIFICARE IS CUSTOMER SATISFACTION SURVEY KEY MEASUREMENTS PLAN:

      [...***...] after the results of the first annual IS Customer Satisfaction
      Survey are available the Supplier shall provide a Key Measurements plan to
      measure the applicable improvement of Supplier provided service identified
      in the IS Customer Satisfaction Survey as requiring improvement.
      Identified Key Measurements shall be approved by PacifiCare and reported
      on a monthly basis. Annually, these Key Measurements shall be adjusted
      based on the latest IS Customer Satisfaction Survey results.

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F.    ACHIEVEMENT OF CMM LEVEL 3 FOR SUPPLIER SOFTWARE DEVELOPMENT
      ORGANIZATIONS:

      A Carnegie Melon Software Engineering Institute's Capability Maturity
      Model certified independent assessor shall certify that the Services have
      achieved ("CMM") Level 3. This Critical Deliverable is due [...***...]
      after the completion of the Supplier's Transition Period.

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IV.   KEY MEASUREMENTS:

This section sets forth qualitative descriptions of the Key Measurements. The
Minimum Service Level and Expected Service Level targets associated with such
Key Measurements are set forth in Service Level Attachment SLA-1. The column
"Track and Report by Region" on the Key Measurement tab of Service Level
Attachment SLA-1 indicates the region(s) in which these Key Measurements apply.
As indicated, the monthly performance reports should contain the results for
these Key Measurements by region.

A.    PERFORMANCE CATEGORY- APPLICATION AVAILABILITY:

      Application Availability is the Availability tracked during Online Hours
      for each identified Application within the associated PacifiCare Service
      Location in the Key Measurement Section.

B.    PERFORMANCE CATEGORY APPLICATION RESPONSE TIME:

      Application Response Time is the response time tracked during Online
      Hours. It is measured using the [...***...]th percentile generated by
      Infrastructure Supplier's monitoring tools to collect and summarize
      end-to-end response time for Application during Online Hours. The targets
      for response time are identified in Service Level Attachment SLA-1.

C.    PERFORMANCE CATEGORY - APPLICATION PERFORMANCE DEGRADATION:

      Supplier shall track and record Application performance degradation (slow
      response) using information as reported by the End-Users through the
      Infrastructure Supplier via the Infrastructure Supplier's problem
      management tools ("APPLICATION PERFORMANCE DEGRADATION"). [...***...]

D.    PERFORMANCE CATEGORY CRITICAL PROCESSES:

      The Batch Schedule Completion On-Time Rate calculation includes production
      of updated files and appropriate reports, produced in a calendar month.
      The list of all Critical Batch Jobs (the Scheduled Batch Jobs) to be
      tracked in this performance category can be found on the SLA-1 under the
      title Critical Batch Jobs.

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      [...***...]

      With respect to ongoing Scheduled Batch Jobs scheduling requirements,
      Supplier shall be responsible to make updates to the job schedules as
      required and review such updates with PacifiCare no less frequently than
      [...***...].

      For the avoidance of doubt, if the total number of Scheduled Batch Jobs
      per Application scheduled in a [...***...] is less than [...***...], then:

      The compliance calculation described in this Section shall be calculated
      and reported, and a failure to meet the Expected Service Level shall occur
      only if (a) the total number of Scheduled Batch Jobs per Application
      scheduled in that [...***...], minus (b) the total number of Scheduled
      Batch Jobs successfully completed on-time per Application, is greater than
      [...***...]. A failure to meet the Minimum Service Level shall occur only
      if (y) the total number of Scheduled Batch Jobs PEr Application scheduled
      in that [...***...], minus (z) the total number of Scheduled Batch Jobs
      per Application successfully completed on-time, produced in a calendar
      month is greater than [...***...].

E.    OTHER APPLICATION SERVICE LEVELS:

            1.    NICE CLAIMS AVERAGE DAILY VOLUME

            [...***...]

F.    PERFORMANCE CATEGORY - PROBLEM RESPONSE AND RESOLUTION:

            [...***...]

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<PAGE>

            [...***...]

            2.    INITIAL RESPONSE TIME FOR SEVERITY 0 OR 1 HELP DESK CALLS
                  (REFERRED TO SUPPLIER):

                  a.    INITIAL RESPONSE TIME FOR SEVERITY 0 OR 1 HELP DESK
                        CALLS (REFERRED TO SUPPLIER) [...***...]

                  b.    [...***...]

                  [...***...]

            3.    FINAL RESOLUTION OF SUPPLIER ASSIGNED CRITICAL SEVERITY HELP
                  DESK CALLS:

                                 Page 26 of 36              [LOGO] PACIFICARE(R)
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<PAGE>

      [...***...]

G.    PERFORMANCE CATEGORY - APPLICATION MANAGEMENT:

      [...***...]

                                 Page 27 of 36              [LOGO] PACIFICARE(R)
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<PAGE>

            [...***...]

H.    PERFORMANCE CATEGORY - APPLICATIONS PERFORMANCE:

      General. Supplier shall manage Applications performance as to meet or be
      better than the Service Levels set forth in Service Level Attachment
      SLA-1.

            [...***...]

                                 Page 28 of 36              [LOGO] PACIFICARE(R)
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<PAGE>

            [...***...]

I.    PERFORMANCE CATEGORY - DISASTER RECOVERY:

      1.    CONDUCT SUCCESSFUL DISASTER RECOVERY TEST - APPLICATIONS AND
            DATABASES.

      In addition to the annual test of the DRP as set forth in Section 16.1 of
      the Agreement, Supplier may conduct tests of any Disaster Recovery
      Milestones prior to the scheduled delivery date for that Disaster Recovery
      Milestone [...***...]

                                 Page 29 of 36              [LOGO] PACIFICARE(R)
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<PAGE>

      [...***...]

      2.    DISASTER RECOVERY RE-TEST--[...***...].

      Should Supplier fail to achieve any Disaster Recovery Milestone(s)
      required to demonstrate recoverability as defined in the Conduct
      Successful Disaster Recovery Test Key Measurement, Supplier shall be
      obligated to re-test the failed Disaster Recovery Milestone(s) ("RETEST")
      within [...***...] of the failure(s) until the Supplier successfully
      demonstrates such recoverability.

      [...***...]

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<PAGE>

V.    DEFINITION OF TERMS USED IN SERVICE LEVELS

The following terms when used in the Service Level Schedule (including any
exhibits thereto) with initial capital letters shall have the respective
meanings set forth herein. Terms used with initial capital letters that are not
defined herein shall have the meaning set forth in the Agreement.

      1.    [...***...]

      2.    APPLICATIONS MAINTENANCE is any effort where modifications to
            Existing Systems are made to correct/fix code or processes that are
            either no longer operational or will cease to function properly
            without the correction. Maintenance activities include handling Help
            Desk tickets related to resolving production issues or coding bugs;
            production monitoring and trouble-shooting; routine capacity
            assessment and tuning SQM (Service Quality Metrics).

      3.    APPLICATIONS REPRESENTATIVE shall mean those Supplier personnel that
            have been designated to interface with End-Users on resolution of
            Help Desk calls, who have the appropriate authority and capability
            to resolve such problems, and have been so identified to the
            End-Users.

      4.    [...***...]

      5.    [...***...]

      6.    BACKUP shall mean to copy a file or files and place them in an
            appropriate alternate location so that a safe, usable copy remains
            if the original is destroyed.

      7.    [...***...]

      8.    BUSINESS DAY shall mean Monday through Friday excluding national
            holidays and official PacifiCare holidays unless otherwise specified
            by PacifiCare Supplier Relationship Manager (or his / her designee).

      9.    CALL shall mean a call to a Help Desk from an End-User requesting
            assistance that is related to the Services.

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<PAGE>

      10.   COMPONENT shall mean any constituent part of a Product or Services,
            whether provided by Supplier or any other source.

      11.   CRITICAL APPLICATIONS are those Applications that support critical
            business objectives within a specific reporting entity (region) and
            are tracked and measured using Online Hour Measurement Windows under
            the Critical Service Level Section of SLA-1.

      12.   [...***...]

      13.   DOWNTIME shall mean the time that a particular System, Application,
            Product, Software, Equipment or any other part of the Services is
            not available during the Measurement Window as specified in this
            Schedule, for normal business use by the End-User.

      14.   FINAL RESOLUTION is defined as meeting the business requirements in
            place prior to the error that resulted in the Call to the Help Desk,
            and the End-User that reported the problem has been contacted by the
            Help Desk representative and agrees that it has been resolved. For
            clarity, Final Resolution may include workarounds.

      15.   INFRASTRUCTURE HELP DESK shall mean the help desk maintained by the
            Infrastructure Supplier.

      16.   IS CUSTOMER SATISFACTION SURVEY shall mean a survey of End-Users'
            opinions regarding the services provided.

      17.   MAJOR PROJECT is defined in the Statement of Work.

      18.   MINOR PROJECT is defined in the Statement of Work.

      19.   NEW DEVELOPMENT is defined in the Statement of Work.

      20.   ONLINE HOURS shall means all hours within a daily 24-hour period
            minus the Batch Window and Scheduled Downtime. Online hours shall
            mean that period of time (days of the week and hours per day) during
            which a particular System, Application, Software, Equipment or any
            other part of the Services is expected to be available to PacifiCare
            Entities for normal business use.

      21.   PRODUCT shall mean any Equipment, Software or supply item provided
            by Supplier or PacifiCare pursuant to the Agreement.

                                 Page 32 of 36              [LOGO] PACIFICARE(R)
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<PAGE>

      22.   RESPOND shall mean notification may be via telephone or in person to
            the End-User when the End-User reports a problem to Help Desk.

      23.   RESPONSE TIME shall be the value at the [...***...] of a series of
            end-to-end measurements using the Infrastructure Supplier's
            agreed-to tools, which are used to assess the processing speed of an
            Application's operation within the environment.

      24.   SCHEDULED BATCH JOB shall mean a sequence of computer programs that
            are assigned/sent to a computer to run without further user
            interaction and are scheduled, in connection with the Services, by
            an End-User or Supplier to run automatically at a certain time, as
            further described in Sections II.E and IV.D of this Schedule.

      25.   SCHEDULED DOWNTIME of a particular System, Application, element of
            hardware, network or any other part of the Services shall mean the
            amount of time that a particular System, Application, element of
            hardware, network or any other part of the Services is not available
            for normal business use by the End-User that has been agreed to in
            advance by PacifiCare (e.g. planned schedule maintenance
            activities). The Parties intend to schedule such time so as to
            minimize the impact to PacifiCare Entities' business operations.
            Supplier shall maintain Availability during such periods to the
            extent reasonably practicable.

      26.   SERVICE REQUEST shall mean a PacifiCare-approved request that
            Supplier is responsible for logging and tracking, including via a
            service management tool (including Tivoli Service Desk and Help
            Now!).

      27.   SEVERITY LEVEL shall mean the value 0, 1, 2, 3 or 4 assigned to a
            particular problem, as determined by the Infrastructure Supplier
            Help Desk technician when a problem occurs by referring to the
            following table:

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------

       LEVEL                 DESCRIPTION           STATUS UPDATE/ TARGET  RESPONSIBLE GROUP
                                                       RESOLUTION         STATUS REPORTING
-------------------------------------------------------------------------------------------
<S>                    <C>                         <C>                    <C>
Severity           0   COMPANY AND OR  ENTERPRISE  [...***...]            [...***...]
[...***...]            -WIDE

                                                   STATUS UPDATE
                       [...***...]

                                                   [...***...]

                                                   TARGET RESOLUTION

                                                   [...***...]
-------------------------------------------------------------------------------------------
</TABLE>

                                 Page 33 of 36              [LOGO] PACIFICARE(R)
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<PAGE>

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------

       LEVEL                 DESCRIPTION           STATUS UPDATE/ TARGET  RESPONSIBLE GROUP
                                                       RESOLUTION         STATUS REPORTING
-------------------------------------------------------------------------------------------
<S>                    <C>                         <C>                    <C>
                                                   [...***...]
-------------------------------------------------------------------------------------------

Severity 1             MAJOR  OPERATIONAL  IMPACT  [...***...]            [...***...]
                       WITH NO WORKAROUND
                       AVAILABLE
                                                   STATUS UPDATE

                       [...***...]
                                                   [...***...]

                                                   TARGET RESOLUTION

                                                   [...***...]
-------------------------------------------------------------------------------------------

Severity 2             MAJOR OPERATIONAL IMPACT-   TARGET STATUS          [...***...]
                       PRE-EXISTING WORKAROUND
                       IN PLACE.
                                                   [...***...]

                       [...***...]
                                                   TARGET RESOLUTION

                                                   [...***...]
-------------------------------------------------------------------------------------------
</TABLE>

                                 Page 34 of 36              [LOGO] PACIFICARE(R)
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<PAGE>

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------

       LEVEL                 DESCRIPTION           STATUS UPDATE/ TARGET  RESPONSIBLE GROUP
                                                       RESOLUTION         STATUS REPORTING
-------------------------------------------------------------------------------------------
<S>                    <C>                         <C>                    <C>
                       [...***...]
-------------------------------------------------------------------------------------------
Severity 3             -  Individual is Down and
                          there is no work around  TARGET STATUS          [...***...]

                       -  One   individual         [...***...]
                          customer is  unable
                          to work within an
                          Application.             TARGET RESOLUTION

                       [...***...]                 [...***...]
-------------------------------------------------------------------------------------------
Severity 4             -  Individual is            TARGET STATUS          [...***...]
                          experiencing a problem
                          and a workaround does
                          exist                    [...***...]

                       -  Individual  has a        TARGET RESOLUTION:
                          non-urgent question
                          regarding Application,
                          report or other IS
                          related assistance.      [...***...]

                       [...***...]
-------------------------------------------------------------------------------------------
</TABLE>

      28.   SYSTEM CRITICAL SCHEDULED UPTIME shall mean the amount of minutes
            within the applicable Measurement Window for the System as set forth
            in Service Level Attachment SLA-1.

      29.   SYSTEM DOWNTIME shall mean the total time per calendar month out of
            the System Critical Scheduled Uptime, as measured in minutes, that
            the System for which Availability is being computed is not available
            for Use.

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<PAGE>

      30.   SYSTEM shall mean any collection or aggregation of two (2) or more
            Products that are designed to perform, or are represented by
            Supplier as performing or being capable of performing, as a
            functional entity.

      31.   TIME TO RESOLVE shall mean the elapsed time between registration of
            the problem to Supplier's Help Desk and the successful resolution
            (i.e., repair or bypass, not escalation) of the problem as accepted
            by the End-User.

      32.   UNSCHEDULED DOWNTIME shall mean the time that a particular System,
            Application, element of hardware or any other part of the Services
            is not available for normal business use during the Batch Window or
            Online Hours. If the duration of unavailability for Scheduled
            Downtime event exceeds the agreed-to time interval for the event and
            extends into the Online Hours, the time unavailable which extends
            into the Online Hours shall be considered Unscheduled Downtime in
            the Application Availability calculation.

                                 Page 36 of 36              [LOGO] PACIFICARE(R)

<PAGE>

                                   SCHEDULE 8
                      SERVICE LEVEL AGREEMENT ATTACHMENT 1
                               SERVICELAND MATRIX

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                   SCHEDULE 8
                      SERVICE LEVEL AGREEMENT ATTACHMENT 2
                         SERVICE LEVEL OUTCOME EXAMPLES

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 8
                      SERVICE LEVEL AGREEMENT ATTACHMENT 3
                               BALANCED SCORECARD

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 8
                      SERVICE LEVEL AGREEMENT ATTACHMENT 4
               PRE-APPROVED MEASURING TOOLS AND METHODOLOGIES FOR
                       CRITICAL SERVICE LEVEL MEASUREMENTS

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 8
                      SERVICE LEVEL AGREEMENT ATTACHMENT 5
                              APPLICATION SUMMARIES

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                SCHEDULE 9.2 (a)
                          APPROVED BENCHMARK PROVIDERS

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                  SCHEDULE 10.1
                                SERVICE LOCATIONS

PACIFICARE LOCATIONS

1.    Hope Street Building
      10803 Hope St
      Cypress, CA 90630

2.    SoHo Building
      6251 Katella Ave
      Cypress, CA 90630

SUPPLIER LOCATIONS

1.    Rochester ADC
      2900 43rd St NW
      Suite 100
      Rochester, MN 55901

2.    Nova Scotia ADC
      Cogswell Tower
      2000 Barrington St
      Suite 300
      Halifax, Nova Scotia B3J 3K1
      Canada

<PAGE>

                                  SCHEDULE 10.2

                         SAFETY AND SECURITY PROCEDURES

The PacifiCare Safety and Security Procedures can be found via pull-down menus
at the following URL on PacifiCare's intranet:

[...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                   SCHEDULE 11

                                 HUMAN RESOURCES

            For purposes of this Human Resources Schedule, the date on which the
Information Technology Services Agreement ("Agreement") between Keane, Inc.
("Supplier") and PacifiCare ("PacifiCare") enter into the Agreement will be
referred to herein as the "Effective Date."

_.01   Employment Offers. Supplier shall extend offers of employment according
            to the terms of this Schedule and in accordance with the procedures
            described in this Schedule to those PacifiCare employees set forth
            in Exhibit A hereto (collectively, the "Affected Employees"; each,
            an "Affected Employee"). [...***...]

_.02   Hiring Requirements. Supplier shall hire those Affected Employees who:

            (1)   are listed in Exhibit A hereto; and

            (2)   [...***...]

      [...***...]

..03   Terms of Employment. Supplier's offer of employment to each Affected
            Employee shall include the following:

            (1)   Base Salary. [...***...]

            (2)   Positions. [...***...]

            (3)   Work Hours. [...***...]

                                       1.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

            [...***...]

            (4)   Health Care Benefits and Employee Benefit Plans. [...***...]

            (5)   Vacation. [...***...]

            (6)   401(k) Plans. [...***...]

            (7)   Length of Service Credit. [...***...]

            (8)   Adjustments Related to Benefit Plans. [...***...]

                                       2.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

            (9)   Tuition Aid. [...***...]

            (10)  Location. [...***...]

            (11)  Bonuses/Compensation Programs.

                  (a)   [...***...]

                  (b)   [...***...]

            (12)  [...***...]

_.04   Severance Benefits.

            (1)   [...***...]

                                       3.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

            (2)   [...***...]

_.05   Financial and Administrative Responsibilities.

            (1)   [...***...]

_.06   Human Resources Representative. [...***...]

_.07   Conditions for Working on PacifiCare Accounts.

            (1)   Supplier agrees to [...***...]

            (2)   Supplier shall be responsible for [...***...]

            (3)   Supplier will implement an employee training program that will
                  complement, further develop and maintain the requisite skills
                  and technical knowledge of Transitioned Personnel assigned to
                  the PacifiCare account in anticipation of PacifiCare's needs
                  for the products and services in its business units.
                  [...***...]

                                       4.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                    EXHIBIT A

                               AFFECTED EMPLOYEES

NAME

POSITION

BASE SALARY

SHIFT

AMOUNT OF SIGN ON BONUS

AUTOMOBILE ALLOWANCE

FLEX PLAN ALLOWANCE

RELOCATION PACKAGE
<PAGE>

                                    EXHIBIT B

                          RELEASE AND WAIVER OF CLAIMS

          [TO BE EXECUTED UPON TERMINATION OF EMPLOYMENT WITH SUPPLIER]

      I understand that my last day of employment with ________________
("Supplier") will be ______________. In exchange for and in consideration of the
promises and covenants stated in this Release and Waiver ("Release and Waiver")
[...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

      [...***...]

      This Release and Waiver [...***...] constitute the complete, final and
exclusive embodiment of the entire agreement between PacifiCare and me and the
Supplier and me with regard to the subject matter hereof. I am not relying on
any promise or representation by PacifiCare or the Supplier that is not
expressly stated herein or in the First Release and Wavier. This Release and
Waiver may only be modified by a writing signed by both me and a duly authorized
officer of PacifiCare and the Supplier.

Date: __________________                By: ____________________________________
                                              [EMPLOYEE]

                                        ________________________________________
                                              [PACIFICARE REPRESENTATIVE]

                                        ________________________________________
                                              [KEANE REPRESENTATIVE]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                   EXHIBIT B-1

            DISCLOSURE UNDER TITLE 29 U.S. CODE SECTION 626(f)(1)(H)

CONFIDENTIALITY PROVISION:    The information contained in this document is
                              private and confidential. You may not disclose
                              this information to anyone except your
                              professional advisors.

1.    The following departments have been selected for the severance package
      program:

      a.    ____________________________
      b.    ____________________________
      [ADD MORE IF NECESSARY]

2.    In the [two] departments listed above, employees whose job positions will
      be eliminated on [DATE OF TERMINATION] are eligible to participate in the
      severance package program.

3.    An eligible employee will have up to forty-five (45) days to review the
      terms and conditions of the severance package.

<TABLE>
<CAPTION>
================================================================================
              EMPLOYEES ELIGIBLE FOR THE SEVERANCE PACKAGE PROGRAM
--------------------------------------------------------------------------------
                JOB TITLE                                AGE
--------------------------------------------------------------------------------
<S>                                     <C>

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

================================================================================
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
================================================================================
            EMPLOYEES NOT ELIGIBLE FOR THE SEVERANCE PACKAGE PROGRAM
--------------------------------------------------------------------------------
<S>                                     <C>
  JOB CLASSIFICATION/ORGANIZATION UNIT                   AGE
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

================================================================================
</TABLE>

<PAGE>

                                  SCHEDULE 12.2

<PAGE>

                                  SCHEDULE 12.2

                                  KEY PERSONNEL

For confidentiality purposes, the information in this schedule will only be
accessible to the PacifiCare Supplier Relationship Vice President, the Keane
Account Executive, and other personnel (e.g., Human Resources, Legal, etc.) as
deemed necessary.

[...***...]

                                       1.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                SCHEDULE 12.4(e)

<PAGE>

                                SCHEDULE 12.4 (e)

                             APPROVED SUBCONTRACTORS

1.0 INTRODUCTION

This Schedule defines the Supplier Subcontractors that are approved by
PacifiCare for use in performing the Services. Approved Subcontractors shall
also include those subcontractors performing work for PacifiCare as of the
Effective Date.

2.0 APPROVED SUBCONTRACTORS

[...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                SCHEDULE 12.6(a)

<PAGE>

                                SCHEDULE 12.6(a)

                             PACIFICARE COMPETITORS

The following persons or entities (collectively "Companies") are competitors of
PacifiCare Entities:

      (A)   Companies that offer managed care and other health plan products for
            employer groups, other purchasers of commercial health care products
            (including individuals) and Medicare beneficiaries in the States of
            [...***...]

      (B)   Companies that offer specialty products and services [...***...]

      (C)   Companies that provide [...***...]

      (D)   Companies that offer any of the following products or services:
            [...***...]

A representative sample of the PacifiCare Competitors includes but are not
limited to, [...***...]

This Schedule 12.6(a) is subject to quarterly review and revision by the
Steering Committee.

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                SCHEDULE 12.6(b)

                              SUPPLIER COMPETITORS

"Supplier Competitors" are defined to be information technology (IT) application
development, support, maintenance and management providers which [...***...] A
representative sample of Supplier Competitors include but are not limited to the
following: [...***...]

This Schedule 12.6(b) is subject to quarterly review and revision by the
Steering Committee.

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  SCHEDULE 13.2

                        OVERSIGHT AND MANAGEMENT PROCESS

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  SCHEDULE 13.3

                 POLICY AND PROCEDURES MANUAL TABLE OF CONTENTS

1.0 INTRODUCTION

This Schedule defines the table of contents that will evolve into the Policy and
Procedures Manual to be developed during Transition.

2.0 POLICY AND PROCEDURES MANUAL TABLE OF CONTENTS

*Document Control (How to execute changes to policies and procedures guide)

*Document Overview (High level overview of manual 's content)

*Services Overview (High level contract overview)

Process Specifications

         *Change Management
         *Control Backup and Recovery
         Control Batch Operations
         Control Capacity
         Control Inventory
         *Control IT Security
         *Control Service Levels
         Control Tape Operations
         Coordinate IMACs
         *Application Delivery

                  Application Management and Support Operations

              AM Support Services
         *Handle Customer Satisfaction
         Handle Entitlement Failure
         Handle Inventory Logistics
         Handle Procurement
         *Handle User Requests
         Network Services
         *Perform Escalation
         Perform User Administration
         *Perform Asset Inventory
         *Problem Management
         *Provide Request Status
         *Reassign Request
         *Situation Management
         Support Desktop

                                                                     Page 1 of 2
<PAGE>

         Support Hardware Facilities
         *Support Performance
         *Support Software
         *Track Inventory
         *Update Configuration Information

*Acronyms

         INDEX

Note:

-     This table of contents is representative of the topics that need to be
      included in the Policies and Procedures Manual. PacifiCare and IBM/Keane
      will agree on the final version of the document. These Policies and
      Procedures will address where the client and supplier need to interface.

-     This Policy and Procedures Manual will be a comprehensive document and
      refer to other relevant policies and procedures by name or location of the
      living document as they are updated over time.

-     It is not necessary to modify this Schedule via a contract amendment if
      the Table of Contents change in the draft or final document.

-     The sections where Keane will provide information are indicated with an
      "*". The Application Delivery Section is provided solely by Keane while
      the remaining sections are IBM's responsibility with Keane contributing to
      reviewing content. This will be true for the version of Schedule 13.3 that
      will be attached to the Keane and PacifiCare Agreement.

                                                                     Page 2 of 2
<PAGE>

                                SCHEDULE 14.2(a)

                         PACIFICARE PROPRIETARY SOFTWARE

1.0 INTRODUCTION

This Schedule lists the PacifiCare Proprietary Software as defined in Exhibit A
of the Agreement.

2.0 PACIFICARE PROPRIETARY SOFTWARE

            PROPRIETARY SOFTWARE NAME

[...***...]

                                       1.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                            PROPRIETARY SOFTWARE NAME

[...***...]

                                       2.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                SCHEDULE 14.2(b)
                         PACIFICARE THIRD PARTY SOFTWARE

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
      NO.                            SUPPLIER:                                        DESCRIPTION:
----------------------------------------------------------------------------------------------------------------------
<S>                  <C>                                                    <C>
[...***...]          [...***...]                                            [...***...]
----------------------------------------------------------------------------------------------------------------------
</TABLE>

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  SCHEDULE 14.3

                                SUPPLIER SOFTWARE

[...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  SCHEDULE 16.1

                                CRITICAL SERVICES

APPLICATION:                              RECOVERY
                                          TIME-FRAME
[...***...]

CUSTOMER SUPPORT SYSTEMS:                       APPLICATION RUNNING IN REGION

[...***...]

                                   Page 1 of 1
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                   SCHEDULE 17
                                CHARGES SCHEDULE

<PAGE>

This Schedule describes the methodology for calculating the Fees. In the event
of any conflict, confusion or ambiguity between this Schedule and the Agreement,
the Agreement shall control.

ATTACHMENTS

The following Attachments are attached hereto and are hereby incorporated by
reference:

Attachment 17.1 Summary of Base Fees

Attachment 17.2 Resource Baselines

Attachment 17.3 Resource Unit Rates

Attachment 17.4 Systems Maintenance and Enhancements Hourly Rates

Attachment 17.5 Termination Fees

Attachment 17.6 Managed-Agreement Contractors

1. DEFINITIONS

      Terms used herein with initial capital letters shall have the respective
meanings set forth in the Agreement, or, for those terms that are not defined in
the Agreement, the meanings set forth in this Schedule.

      1.1 "ACTUAL RESOURCE UNITS" has the meaning set forth in Section 4.1(a)
(Calculation of ARCs for Resource Units) of this Schedule.

      1.2 "ARC(S)" or "ADDITIONAL RESOURCE CHARGE(S)" is defined in the
Agreement.

      1.3 "ARC RATE" means the per Resource Unit rate at which PacifiCare is
charged for use of Resource Units above the Baseline.

      1.4 "BASELINE" means the quantity of a particular Resource Unit that
constitutes the volume of that Resource Unit included in the Base Fees. The
Parties have established the initial Baselines for each Resource Unit as of the
Effective Date, which are enumerated in Attachment 17.2 to this Schedule.
Baselines may be adjusted during the Term pursuant to the processes established
in the Agreement.

      1.5 "BILLABLE FTE" or "BILLABLE FULL TIME EQUIVALENT" means [...***...]

      1.6 "BILLABLE HOURS" means productive hours expended by Supplier in
performing the Services, including application software development; technology
services; customer support; maintenance; operations; and other Project-related
activities, but excluding non-productive time, including the following:
administrative time (including management time), non-Project related meetings;
formal training not directly related to Projects; other training, including

                                       1.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

CMM and internal training, not directly related to Projects; vacation time, PTO,
STO, bereavement and jury duty.

      1.7 "CUSTOMER-FACING PERSONNEL" means Project Staff who directly interact
with End-Users on a face to face basis. Customer-Facing Personnel include
Project Staff who:

            (a) are expected to pick up specifications for Projects;

            (b) work with End-Users for End-User acceptance testing;

            (c) provide in-depth Customer Support to End-Users; and

            (d) other Project Staff whose primary responsibilities involve
interfacing directly with End-Users or other PacifiCare personnel.

      1.8 "ECONOMIC CHANGE ADJUSTMENT" or "ECA" has the meaning set forth in
Section 6.1 below.

      1.9 "FULL TIME PERSON" or "FTP" means the basis for measuring the work
effort associated with a properly trained person providing Services on a
full-time basis. No individual FTP may account for greater than [...***...].
Actual Billable Hours shall be tracked and reported on a monthly basis, and the
Parties shall discuss progress toward meeting the monthly target. All
Customer-Facing Personnel FTPs will be based on-site at PacifiCare Service
Locations.

      1.10 "INTEREST" means interest payable by PacifiCare on undisputed amounts
not timely paid in accordance with Section 17 of the Agreement.

      1.11 "INTEREST RATE" means the rate of interest from time to time
announced by Citigroup, Inc. at its principal office in the United States as its
prime commercial lending rate plus [...***...] ([...***...]%), but in no event
to exceed the highest lawful rate of interest.

      1.12 "RESOURCE UNIT" means the applicable unit of measurement for usage of
a specified resource.

      1.13 "RRC(S)" or "REDUCED RESOURCE CHARGE(S)" is defined in the Agreement.

      1.14 "RRC RATE" means the Resource Unit rate at which PacifiCare is
credited for its use of Resource Units below the Baseline.

      1.15 "START UP FEES" mean all one-time costs associated with the
transition of Services from PacifiCare to Supplier.

                                       2.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

      1.16 "SYSTEMS MAINTENANCE AND ENHANCEMENTS" or "SME" is defined in Section
3.1(a).

2. BASE FEES

      Base Fees include the Operational Fees for SME (as defined in Section
3.1(a) below) set forth on Attachment 17.1 to this Schedule, which include Start
Up-Fees (including [...***...]), all as enumerated on Attachment 17.1 to this
Schedule.

3. BASELINES

      3.1 INITIAL BASELINES. The quantity of each Resource Unit that shall be
utilized in providing Services to PacifiCare under the Agreement as of the
Effective Date in consideration for the Base Fees shall be specified in
Attachment 17.2 to this Schedule as a Baseline.

            (a) BILLABLE FTES. The Resource Units for Systems Maintenance and
Enhancements ("SME") shall be Billable FTEs, and the Baseline for these Resource
Units are set forth in Attachment 17.2 to this Schedule. The ARCs and RRCs
described in the Agreement and calculated according to this Schedule apply only
in relation to the Billable FTE Baseline. For clarity, as the Billable FTE
Baseline decreases over the course of the Term, Supplier shall generate the same
amount of work. This is made possible by Supplier's productivity increases, as
measured by the Balanced Scorecard.

            (b) BILLABLE HOURS. SME shall also be measured in Billable Hours,
and reported to PacifiCare.

      3.2 BASELINE ADJUSTMENTS. Baselines for a Resource Unit are adjustable in
accordance with the Agreement. In accordance with the Policy and Procedures
Manual, the Parties shall implement a planning process to facilitate additions
or reductions to the Baselines.

4. VARIABLE FEES

      4.1 ARCS. Subject to the Agreement, including Section 17.8 and Section 4.3
below, Supplier shall provide additional Resource Units to the extent requested
and pre-approved by PacifiCare. PacifiCare's increased usage of a Resource Unit
(when compared with the Baseline for that Resource Unit) shall result in an ARC
payable by PacifiCare as set forth in Section 11.3 below.

            (a) CALCULATION OF ARCS FOR RESOURCE UNITS. For each Resource Unit,
Supplier shall compare the quantity of Resource Units used during the applicable
measurement period ("ACTUAL RESOURCE UNITS") with the Baseline for that Resource
Unit. If the Actual Resource Units exceed the applicable Baseline for such
period, PacifiCare shall pay Supplier an

                                       3.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

ARC in accordance with Section 17 of the Agreement and this Schedule with the
current or future charges (or, if no future charges shall be due, make payment
to Supplier) equal to the product of the ARC Rate for the applicable Resource
Unit, as set forth in Attachment 17.3 to this Schedule, multiplied by the
difference between the Actual Resource Units for that Resource Unit and the
applicable Baseline.

            (b) EXAMPLE. Assuming the following variables, the ARC calculation
would be as follows below:

                                   [...***...]

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
                                 ARC CALCULATION
--------------------------------------------------------------------------------
<S>            <C>
ARC        =   [...***...]
--------------------------------------------------------------------------------
ARC        =   [...***...]
--------------------------------------------------------------------------------
ARC        =   [...***...]
--------------------------------------------------------------------------------
</TABLE>

In this example, the ARCs for FTPs for the month would be [...***...].

      4.2 RRCS. Subject to the Agreement, including Section 17.8 and Section 4.3
below, Supplier shall reduce Resource Units to the extent requested and
pre-approved by PacifiCare. PacifiCare's decreased usage of a Resource Unit
(when compared with the Baseline for that Resource Unit) shall result in a RRC
creditable to PacifiCare as set forth in Section 11.3 below.

            (a) CALCULATION OF RRCS FOR RESOURCE UNITS. For each Resource Unit,
Supplier shall compare the quantity of Actual Resource Units used during the
applicable measurement period with the Baseline for that Resource Unit. If the
Actual Resource Units fall below the applicable Baseline for such period,
PacifiCare shall be credited a RRC in accordance with Section 17 of the
Agreement and this Schedule with the current or future charges (or, if no future
charges shall be due, Supplier shall make payment to PacifiCare) equal to the
product of the RRC Rate for the applicable Resource Unit, as set forth in
Attachment 17.3 to this Schedule, multiplied by the difference between the
applicable Baseline and the Actual Resource Units.

            (b) EXAMPLE 1. Assuming the following variables, the RRC calculation
would be as follows below:

[...***...]

                                       4.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
                                 RRC CALCULATION
--------------------------------------------------------------------------------
<S>            <C>
RRC        =   [...***...]
--------------------------------------------------------------------------------
RRC        =   [...***...]
--------------------------------------------------------------------------------
RRC        =   [...***...]
--------------------------------------------------------------------------------
</TABLE>

In this example, the RRCs for FTPs for the month would be [...***...]

            (c) EXAMPLE 2. Assuming the following variables, the RRC calculation
would be as follows below:

      [...***...]

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
                                 RRC CALCULATION
--------------------------------------------------------------------------------
<S>            <C>
RRC        =   [...***...]
--------------------------------------------------------------------------------
RRC        =   [...***...]
--------------------------------------------------------------------------------
RRC        =   [...***...]
--------------------------------------------------------------------------------
</TABLE>

In this example, the RRCs for FTPs for the month would be [...***...].

      4.3 NOTICE PERIOD FOR ARCS AND RRCS. PacifiCare shall provide Supplier
with at least [...***...] notice of a request for an ARC, and [...***...] notice
of a request for an RRC, [...***...]

5. SERVICE LEVEL CREDITS

      PacifiCare shall be entitled to receive Service Level Credits in
accordance with Section 8.7 of the Agreement and Schedule 8 to the Agreement.

6. INFLATION ADJUSTMENT

      6.1 Supplier shall calculate and apply an adjustment to the Base Fees
annually based upon economic changes in cost of living (an "ECONOMIC CHANGE
ADJUSTMENT" or "ECA") as described below, beginning on the anniversary of the
Effective Date. The ECA shall be payable

                                       5.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

on a prospective basis1 (for example, the actual inflation for 2002 shall
determine the ECA for the year 2003) on the Base Fees, ARCs, and hourly fees
relating to New Services payable by PacifiCare, minus the RRCs creditable to
PacifiCare. The ECA shall be determined as soon as practicable after the end of
each calendar year using the formula below.

      6.2 Supplier shall invoice PacifiCare for the ECA, if any, along with the
Base Fees, beginning in January 2003 and monthly thereafter. [...***...]

      6.3 ACTUAL INFLATION. Supplier shall calculate the [...***...] by
comparing the change in the year-to-year [...***...] with the [...***...] for
the year before the Effective Date (the "BASE YEAR INDEX"). For each calendar
year of the Term, the actual [...***...] for the year before the year for which
the [...***...] is being calculated ("ACTUAL INFLATION") shall be compared to
the Base Year Index (for example, the [...***...] for 2002 shall be used to
determine the [...***...] for the year 2003). If Actual Inflation is equal to or
less than the Base Year Index, then no [...***...] is due to Supplier. If,
however, Actual Inflation is greater than the Base Year Index, then Supplier
shall apply the [...***...] to the Base Fees and ARCs due Supplier, less RRCs,
for the year for which Supplier is calculating the [...***...].

      6.4 ECA CALCULATION. The ECA is equal to [...***...]

            (a) EXAMPLE. Assuming the following variables, the ECA calculation
would be as follows below:

      [...***...]

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
                                 ECA CALCULATION
--------------------------------------------------------------------------------
<S>            <C>
ECA        =   [...***...]
--------------------------------------------------------------------------------
ECA        =   [...***...]
--------------------------------------------------------------------------------
ECA        =   [...***...]
--------------------------------------------------------------------------------
</TABLE>

------------
[...***...]

                                       6.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
                                 ECA CALCULATION
--------------------------------------------------------------------------------
<S>            <C>
ECA        =   [...***...]
--------------------------------------------------------------------------------
</TABLE>

7. ADDITIONAL SERVICE FEES

      If Supplier provides Services to additional PacifiCare Included Affiliates
in accordance with Section 3.1 of the Agreement, then PacifiCare shall pay and
fees or expenses related to the provision of such Services as negotiated by the
Parties in accordance with that section.

8. NEW SERVICES

      Any requests for New Services are subject to the terms of the Agreement,
including the terms of Section 3.9 (Right to Use Third Parties). In the event
that PacifiCare requests that Supplier perform a New Service as described in
Section 5.1 of the Agreement, then at the time the New Service is requested, and
pursuant to Section 5.1 of the Agreement (New Services), Supplier shall
calculate Supplier's prospective fee for such New Service using Supplier's
standard fee, as described in Attachment 17.4 to this Schedule (unless otherwise
mutually negotiated in good faith between the Parties), and subject to Section
17.14 of the Agreement [...***...].

9. TERMINATION FEES

      9.1 EARLY TERMINATION FEE. In the event PacifiCare terminates the
Agreement and triggers payment of the Early Termination Fees as set forth in
Section 25.1 of the Agreement, PacifiCare shall pay the applicable Early
Termination Fees as set forth in Attachment 17.5 to this Schedule. [...***...]

      9.2 TERMINATION ASSISTANCE SERVICES FEE. In the event any Termination
Assistance Services provided by Supplier cannot be provided through resources
included in the Fees, PacifiCare shall pay the Termination Assistance Services
Fee as provided in Section 26.2 of the Agreement.

10. PASS-THROUGH EXPENSES.

      Pass-through expenses include (a) the actual costs payable by PacifiCare
in accordance with Section 17 of the Agreement, (b) [...***...] (c) travel in
accordance with Section 12.6 below. Supplier shall invoice such pass-through
expenses monthly in arrears and PacifiCare shall pay such invoices as set forth
in Section 17 of the Agreement. Approval processes for these expenses shall be
set forth in the

                                       7.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

Policy and Procedures Manual. If and as applicable, taxes shall be paid as set
forth in Section 18 of the Agreement.

11. REPORTING AND INVOICING; CHARGEBACKS AND TIME ACCOUNTING

      11.1 REPORTING. After the completion of each month during the Term,
following the first month after the Cutover Date, Supplier shall (1) measure,
track and report PacifiCare's usage of Resource Units using a
PacifiCare-approved time accounting system that can be audited and verified; and
(2) calculate, track and report ARCs and RRCs as set forth in Section 4 above
(Variable Fees); and provide PacifiCare with a Variable Fee Report detailing
Resource Unit usage and the ARC/RRC calculations made by Supplier pursuant to
Section 4 above for each Resource Unit. Supplier shall provide the information
required by PacifiCare directly into PacifiCare's time accounting system.

      11.2 INVOICES. All Fees shall be invoiced to PacifiCare as specified in
Section 17.5 of the Agreement. The invoice details shall be agreed to by the
parties within thirty (30) days after the Effective Date. Supplier shall submit
its first invoice to PacifiCare at the Cutover Date and thereafter as provided
in the Agreement and this Schedule. In accordance with Section 17.12 of the
Agreement, this first invoice will be prorated for the period of time from the
Cutover Date through the end of the month in which the Cutover Date occurs.

      11.3 PAYMENT. All Base Fees shall be reported and billed on monthly basis
by taking the annual fees specified in Attachment 17.1 and dividing by twelve
(12). Based upon the Variable Fee Report, and in accordance with Section 17.4 of
the Agreement (Variable Fee Report), the Parties shall reconcile payment of any
Variable Fees with other amounts paid or payable every month. PacifiCare shall
pay amounts due to Supplier in accordance with Section 17 of the Agreement
(Payments and Invoicing). All periodic charges shall be computed on a
calendar-month basis and shall be prorated for any partial month, unless
expressly stated otherwise.

      11.4 INTEREST. Interest on overdue amounts that are not the subject of a
dispute in accordance with Section 17.7 of the Agreement shall be calculated as
[...***...]

            (a) EXAMPLE. Assuming the following variables, the Interest
calculation would be as follows below:

                  (i) The undisputed amount overdue is [...***...]; and

                  (ii) The Interest Rate is [...***...] percent ([...***...]%);
and

                  (iii) Payment of the undisputed amount is [...***...] late;
and

                                       8.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                  (iv) There are thirty (30) days in the month in which the
undisputed amount is due.

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
                              INTEREST CALCULATION
--------------------------------------------------------------------------------
<S>                 <C>
Interest        =   [...***...]
--------------------------------------------------------------------------------
Interest        =   [...***...]
--------------------------------------------------------------------------------
Interest        =   [...***...]
--------------------------------------------------------------------------------
</TABLE>

12. ASSUMPTIONS. Supplier's charges for Resource Units under this Schedule are
subject to the following assumptions:

      12.1 [...***...]

      12.2 [...***...]

      12.3 [...***...]

      12.4 [...***...]

      12.5 [...***...]

      12.6 [...***...]

                                       9.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

13. MANAGED-AGREEMENT CONTRACTORS.

      Within fifteen (15) days of the Effective Date, PacifiCare shall include
as Attachment 17.6 a list of up to [...***...] contractors whose services
PacifiCare believes it is required to retain under its existing agreements. For
so long as Supplier retains the services of these contractors, PacifiCare shall
be responsible for compensation to them under the existing agreements. Supplier
shall credit against invoiced amounts the actual costs of PacifiCare associated
with compensating these contractors. When completed, Attachment 17.6 shall be
integrated with and become a part of this Schedule.

14. ADJUSTMENTS RELATED TO SCHEDULES 7.1 (ASSIGNED AGREEMENTS) AND 7.2 (MANAGED
AGREEMENTS).

      14.1 BACKGROUND. As described in Section 7 of the Agreement (Third Party
Agreements), Supplier shall be responsible for payments pursuant to the Assigned
Agreements, and PacifiCare shall remain responsible for payments pursuant to the
Managed Agreements. [...***...]

            [...***...]

      14.2 ADJUSTMENT TO SCHEDULES 7.1 AND 7.2. The Parties agree that on a
mutually agreeable date [...***...] after the date on which the latter of
Schedule 7.1 or 7.2 is provided to Supplier (the "ADJUSTMENT DATE"), the Parties
shall revise Schedules 7.1 and 7.2 to:

            [...***...]

                                      10.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

            [...***...]

      14.3 ADJUSTMENTS TO PRICING. Concurrent with the adjustment to Schedules
7.1 and 7.2 described above, and in accordance with those procedures:

            [...***...]

15. POST-CLOSING ADJUSTMENTS.

      15.1 ASSUMPTIONS MADE. The Parties acknowledge that each has made certain
financial and operational assumptions which are necessary as of the Effective
Date, but which may prove to be inaccurate, resulting in financial implications
such that it may be desirable to reconcile certain of the financial terms under
the Agreement with the Parties' actual respective financial obligations. The
Parties therefore agree that within thirty (30) days of the Cutover Date

                                      11.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

("TRUE-UP DATE"), the parties shall meet to discuss the assumptions made in the
following areas:

            (a)   Actual Average Salary [...***...]

            (b)   Actual Contractor Count and Rates/Costs [...***...]

            (c)   PacifiCare retention bonus payouts and tax impact [...***...]

            (d)   Costs related to Assigned Agreements [...***...]

      15.2 TRUE-UP. In the event that the Parties mutually agree that in the
above-listed areas there exists a variance at the True-Up Date between the
actual amounts, and the assumptions memorialized in the Agreement at the
Effective Date, then:

            (a)   With respect to the assumption described in Section 15.1(a):

                  (i) If the actual average salary is higher than the assumed
average salary, then Base Fees will be increased in an amount equal to
[...***...]

                  (ii) If the actual average salary is lower than the assumed
average salary, then Base Fees will be reduced in an amount equal to [...***...]

            (1)   CALCULATION EXAMPLE: VARIANCE GREATER THAN [...***...]

[...***...]

            (2)   CALCULATION EXAMPLE: VARIANCE LESS THAN [...***...]

[...***...]

            (3)   CALCULATION EXAMPLE: VARIANCE GREATER THAN [...***...]

                                      12.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

[...***...]

            (b) With respect to the assumption described in Section 15.1(b), the
Parties shall determine methodology to perform a true-up within [...***...] of
the Effective Date. In event of a variance, the Parties shall work together to
develop options for an accelerated transition of the applicable
Managed-Agreement Contractors. The financial impact shall be resolved in
accordance with the process described in Section 13.

            (c) [...***...]

            (d) With respect to the assumption described in Section 15.1(d), if
actual costs related to the Assigned Agreements set forth in Schedule 7.1
differs from the assumed costs, the Base Fee will be adjusted accordingly.

      15.3 ADDITIONAL TRUE-UP FOR ACTUAL CONTRACTOR COUNT AND RATES/COSTS. In
addition to the provisions of Section 15.2(b), the Parties agree to repeat the
procedures set forth in Section 15.2(b) above, upon the earlier of [...***...]

      15.4 FURTHER ACTIONS. The Parties agree to make any revisions to the
Agreement (including any Schedule or Attachment thereto) necessary to
memorialize revisions to the assumptions or financial terms accordingly.

                                      13.
                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  SCHEDULE 17.1

<PAGE>

                                 ATTACHMENT 17.1

                         SUMMARY OF BASE FEES ( X $1000)

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
<S>                                    <C>     <C>     <C>     <C>     <C>     <C>           <C>     <C>     <C>     <C>      <C>
                Category of Services   Year 1  Year 2  Year 3  Year 4  Year 5  Year 6        Year 7  Year 8  Year 9  Year 10  Total
------------------------------------------------------------------------------------------------------------------------------------
<S>                                    <C>     <C>     <C>     <C>     <C>     <C>           <C>     <C>     <C>     <C>      <C>

OPERATIONAL FEES
------------------------------------------------------------------------------------------------------------------------------------
       DATA CENTER
       -----------------------------------------------------------------------------------------------------------------------------
       [...***...]                                                             [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
                                                                               [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
       [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
                                                                               [...***...]
       -----------------------------------------------------------------------------------------------------------------------------

       -----------------------------------------------------------------------------------------------------------------------------
       NETWORK
       -----------------------------------------------------------------------------------------------------------------------------
       [...***...]                                                             [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
                                                                               [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
                                                                               [...***...]
       -----------------------------------------------------------------------------------------------------------------------------

       -----------------------------------------------------------------------------------------------------------------------------
       DISTRIBUTED COMPUTING
       -----------------------------------------------------------------------------------------------------------------------------
                                                                               [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
                                                                               [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
                                                                               [...***...]
       -----------------------------------------------------------------------------------------------------------------------------

       -----------------------------------------------------------------------------------------------------------------------------
         SYSTEMS MAINTENANCE
            AND ENHANCEMENTS                                                   [...***...]
                                TOTAL
       -----------------------------------------------------------------------------------------------------------------------------

       -----------------------------------------------------------------------------------------------------------------------------
       DESKTOP
       -----------------------------------------------------------------------------------------------------------------------------
       [...***...]                                                             [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
                                                                               [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
                         DESKTOP TOTAL                                         [...***...]
       =============================================================================================================================

       -----------------------------------------------------------------------------------------------------------------------------
       HELP DESK TOTAL
                                                                               [...***...]
       =============================================================================================================================

       -----------------------------------------------------------------------------------------------------------------------------
       INFORMATION DISTRIBUTION
         CENTER
       -----------------------------------------------------------------------------------------------------------------------------
       [...***...]                                                             [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
                                                                               [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
        INFORMATION DISTRIBUTION
          CENTER TOTAL                                                         [...***...]
       =============================================================================================================================

TOTAL OPERATIONAL FEES                                                         [...***...]
       =============================================================================================================================

====================================================================================================================================
START-UP FEES
------------------------------------------------------------------------------------------------------------------------------------
       [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
                                                                                                                             0
       -----------------------------------------------------------------------------------------------------------------------------
TOTAL START-UP FEES                                                            [...***...]

------------------------------------------------------------------------------------------------------------------------------------
GRAND TOTAL FEES                                                               [...***...]
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
PRODUCTIVITY
------------------------------------------------------------------------------------------------------------------------------------
       [...***...]                                                             [...***...]
       -----------------------------------------------------------------------------------------------------------------------------
                                                                               [...***...]
====================================================================================================================================
</TABLE>

       [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  SCHEDULE 17.2

                               RESOURCE BASELINES

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  SCHEDULE 17.3

                               RESOURCE UNIT RATES

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  SCHEDULE 17.4

                SYSTEMS MAINTENANCE AND ENHANCEMENTS HOURLY RATE

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  SCHEDULE 17.5

                                TERMINATION FEES

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  SCHEDULE 17.6

                          MANAGED-AGREEMENT CONTRACTORS

                                   [...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  SCHEDULE 19.1

<PAGE>

                                  SCHEDULE 19.1

                          FORM NON-DISCLOSURE AGREEMENT

      Agreement between [PacifiCare or Supplier, as the case may be] having a
place of business at ______________________________ hereinafter ("Disclosing
Party") and [Third party requesting access to PacifiCare and/or Keane
Confidential Information] having a place of business at
______________________________ hereinafter ("Recipient").

      WHEREAS, PacifiCare Health Systems, Inc. ("PacifiCare") and Keane, Inc.
("Supplier") have entered into an agreement (the "PacifiCare Agreement") whereby
Supplier will provide certain information technology application systems
maintenance and enhancement services ("Services") to PacifiCare; and

      WHEREAS, PacifiCare and Supplier have provided each other with information
which PacifiCare and Supplier deem confidential or proprietary ("Confidential
Information") and which is necessary for PacifiCare to acquire and Supplier to
render the Services; and

      WHEREAS, PacifiCare and Supplier are authorized to provide access to the
Confidential Information to others in accordance with the PacifiCare Agreement
in connection with the Services; and

      WHEREAS, the Disclosing Party intends to disclose to Recipient, and
Recipient wishes to receive certain Confidential Information relating to the
Services:

      In consideration for Recipient's agreements hereunder and knowing that the
Disclosing Party is relying thereon, the parties agree as follows:

1.    The Confidential Information shall remain the property of PacifiCare or
      Supplier. No license rights are granted to the Recipient, directly or
      indirectly, to use the Confidential Information disclosed under this
      Agreement for any purpose other than for the purpose stated on the face
      hereof. All copies of such Confidential Information shall be returned to
      PacifiCare or Supplier upon request.

2.    Recipient will protect the Confidential Information to prevent
      unauthorized use, dissemination or publication. Except as stated herein,
      the Recipient shall not reproduce the Confidential Information provided
      under this Agreement in any manner or for any purpose without the prior
      written authorization of the Disclosing Party. The Recipient shall
      immediately notify the Disclosing Party of any disclosure, inquiry, or
      demand made by any third party regarding the Confidential Information.

3.    The Recipient shall protect the Confidential Information provided under
      this Agreement by taking all necessary and reasonable precautions to
      prevent unauthorized disclosure.

                                       1.
<PAGE>

4.    Recipient shall hold the Confidential Information in strictest confidence,
      and shall use the Confidential Information only for the purposes of this
      Agreement and disclose the Confidential Information only to employees of
      the Recipient who have a need to know and who have agreed in writing to
      abide by the terms and conditions of this Agreement prior to disclosure.

5.    Exceptions to Obligations. The Recipient shall not be liable under this
      Agreement for disclosure of Confidential Information under the following
      circumstances:

      (a)   The Confidential Information is required to be disclosed by judicial
            action after all available legal remedies to maintain the
            confidentiality of the Confidential Information have been exhausted;

      (b)   The Confidential Information is made public without breach of this
            Agreement by the Recipient;

      (c)   The Confidential Information was known to the Recipient prior to
            disclosure by the Disclosing Party and the Recipient provides
            written notice to the Disclosing party to that effect at the time of
            disclosure;

      (d)   The Confidential Information is independently developed by the
            Recipient subsequent to disclosure by the Disclosing Party.

6.    Neither this Agreement, nor any rights hereunder in whole or in part shall
      be assignable or otherwise transferable by either party and the
      obligations contained in this Agreement shall survive and continue after
      termination of this Agreement.

7.    Notwithstanding any other provisions of this Agreement, Recipient agrees
      not to export directly or indirectly, any U.S. source technical data
      acquired from the Disclosing Party or any products utilizing such data
      unless such export is in compliance with the United States Export Laws and
      Regulations.

8.    Injunctive Relief.

      (a)   The Recipient acknowledges that (1) PacifiCare and/or Supplier will
            be irreparably harmed if the Recipient's obligations under this
            Agreement are not specifically enforced; and (2) that PacifiCare
            and/or Supplier would not have an adequate remedy at law in the
            event of an actual or threatened violation of the Recipient of its
            obligations.

      (b)   The Recipient agrees that PacifiCare and/or Supplier shall be
            entitled to an appropriate decree of specific performance for any
            violations or breaches by the Recipient, its employees, agents and
            representatives without the necessity of demonstrating actual
            damages or that monetary damages would not afford an adequate
            remedy.

                                       2.
<PAGE>

9.    Should any provision of this Agreement be held by a court of competent
      jurisdiction to be illegal, invalid, or unenforceable, the remaining
      provisions of this Agreement shall not be affected or impaired thereby.

10.   The failure of either party to enforce any term or condition of this
      Agreement shall not constitute a waiver of either party's right to enforce
      each and every term and condition of this Agreement.

11.   This Agreement shall be binding upon and inure to the benefit of the
      parties' successors, legal representatives, and authorized assigns.

12.   This Agreement constitutes the entire agreement of the parties with
      respect to its subject matter and supersedes all prior or contemporaneous
      oral or written agreements or understandings between the parties on such
      subject matter. This Agreement may be modified only in writing signed by a
      duly authorized representative of the parties.

13.   This Agreement shall be governed by and construed in accordance with the
      laws of the State of California. Any actions arising under this Agreement
      shall be brought only in the state or federal courts of California.

RECIPIENT: __________________                    DISCLOSING PARTY:______________

______________________________                   ______________________________
Signature                                                 Signature

______________________________                   ______________________________
(Print Name)                                              (Print Name)

______________________________                   ______________________________
(Title)                                                   (Title)

______________________________                   ______________________________
(Date)                                                    (Date)

                                       3.
<PAGE>

                                  SCHEDULE 19.4

                           RECORDS RETENTION SCHEDULE

[...***...]

                                               *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  SCHEDULE 24.4

                      FAILURE TO PROVIDE CRITICAL SERVICES

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
CRITICAL SERVICE                                        CURE PERIOD
--------------------------------------------------------------------------------
<S>                                                     <C>
[...***...]                                             [...***...]
--------------------------------------------------------------------------------
[...***...]                                             [...***...]
--------------------------------------------------------------------------------
[...***...]                                             [...***...]
--------------------------------------------------------------------------------
[...***...]                                             [...***...]
--------------------------------------------------------------------------------
[...***...]                                             [...***...]
--------------------------------------------------------------------------------
[...***...]                                             [...***...]
--------------------------------------------------------------------------------
[...***...]                                             [...***...]
--------------------------------------------------------------------------------
</TABLE>

                                               *CONFIDENTIAL TREATMENT REQUESTED

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00035-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00035-of-00352.parquet"}]]