FORM OF SUBSIDIARY GUARANTY AGREEMENT

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EXHIBIT 10.3

[FORM OF]

SUBSIDIARY GUARANTEE AGREEMENT

SUBSIDIARY GUARANTEE AGREEMENT dated as of November 22, 2002 , among

each of the Subsidiaries listed on Schedule I hereto (each such subsidiary

individually, a "Guarantor" and collectively, the "Guarantors") of AMERICAN

HEALTHWAYS, INC., a Delaware corporation (the "Borrower"), and SUNTRUST BANK, a

Georgia banking corporation, as administrative agent (the "Administrative

Agent") for the Lenders (as defined in the Credit Agreement referred to below).

Reference is made to the Amended and Restated Revolving Credit

Agreement dated as of November 22, 2002 (as amended, supplemented or otherwise

modified from time to time, the "Credit Agreement"), among the Borrower, the

lenders from time to time party thereto (the "Lenders") and SunTrust Bank, as

administrative agent for the Lenders (in such capacity, the "Administrative

Agent"), and issuing bank (in such capacity, the "Issuing Bank"). Capitalized

terms used herein and not defined herein shall have the meanings assigned to

such terms in the Credit Agreement.

The Lenders have agreed to make Loans to the Borrower, and the Issuing

Bank has agreed to issue Letters of Credit for the account of the Borrower,

pursuant to, and upon the terms and subject to the conditions specified in, the

Credit Agreement. Each of the Guarantors is a direct or indirect wholly-owned

Subsidiary of the Borrower and acknowledges that it will derive substantial

benefit from the making of the Loans by the Lenders, and the issuance of the

Letters of Credit by the Issuing Bank. The obligations of the Lenders to make

Loans and of the Issuing Bank to issue Letters of Credit are conditioned on,

among other things, the execution and delivery by the Guarantors of a Subsidiary

Guarantee Agreement in the form hereof. As consideration therefor and in order

to induce the Lenders to make Loans and the Issuing Bank to issue Letters of

Credit, the Guarantors are willing to execute this Subsidiary Guarantee

Agreement.

Accordingly, the parties hereto agree as follows:

SECTION 1. Guarantee. Each Guarantor unconditionally guarantees,

jointly with the other Guarantors and severally, as a primary obligor and not

merely as a surety, (a) the due and punctual payment of (i) the principal of and

premium, if any, and interest (including interest accruing during the pendency

of any bankruptcy, insolvency, receivership or other similar proceeding,

regardless of whether allowed or allowable in such proceeding) on the Loans,

when and as due, whether at maturity, by acceleration, upon one or more dates

set for prepayment or otherwise, (ii) each payment required to be made by the

Borrower under the Credit Agreement in respect of any Letter of Credit, when and

as due, including payments in respect of reimbursement or disbursements,

interest thereon and obligations to provide cash collateral, and (iii) all other

monetary obligations, including fees, costs, expenses and indemnities, whether

primary, secondary, direct, contingent, fixed or otherwise (including monetary

obligations incurred during the pendency of any bankruptcy, insolvency,

receivership or other similar proceeding, regardless of whether allowed or

allowable in such proceeding), of the Loan Parties

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to the Administrative Agent and the Lenders under the Credit Agreement and the

other Loan Documents, (b) the due and punctual performance of all covenants,

agreements, obligations and liabilities of the Loan Parties under or pursuant to

the Credit Agreement and the other Loan Documents; and (c) the due and punctual

payment and performance of all obligations of the Borrower, monetary or

otherwise, under each Hedging Agreement entered into with a counterparty that

was a Lender or an Affiliate of a Lender at the time such Hedging Agreement was

entered into (all the monetary and other obligations referred to in the

preceding clauses (a) through (c) being collectively called the "Obligations").

Each Guarantor further agrees that the Obligations may be extended or renewed,

in whole or in part, without notice to or further assent from it, and that it

will remain bound upon its guarantee notwithstanding any extension or renewal of

any Obligation.

SECTION 2. Obligations Not Waived. To the fullest extent permitted by

applicable law, each Guarantor waives presentment to, demand of payment from and

protest to the Borrower of any of the Obligations, and also waives notice of

acceptance of its guarantee and notice of protest for nonpayment. To the fullest

extent permitted by applicable law, the obligations of each Guarantor hereunder

shall not be affected by (a) the failure of the Administrative Agent or any

Lender to assert any claim or demand or to enforce or exercise any right or

remedy against the Borrower or any other Guarantor under the provisions of the

Credit Agreement, any other Loan Document or otherwise, (b) any rescission,

waiver, amendment or modification of, or any release from any of the terms or

provisions of, this Agreement, any other Loan Document, any Guarantee or any

other agreement, including with respect to any other Guarantor under this

Agreement, or (c) the failure to perfect any security interest in, or the

release of, any of the security held by or on behalf of the Administrative Agent

or any Lender.

SECTION 3. Security. Each of the Guarantors authorizes the

Administrative Agent and each of the Lenders to (a) take and hold security for

payment of this Guarantee and the Obligations and exchange, enforce, waive and

release any such security, (b) apply such security and direct the order or

manner of sale thereof as they in their sole discretion may determine and (c)

release or substitute any one or more endorsees, other guarantors of other

obligors.

SECTION 4. Guarantee of Payment. Each Guarantor further agrees that its

guarantee constitutes a guarantee of payment when due and not of collection, and

waives any right to require that any resort be had by the Administrative Agent

or any Lender to any of the security held for payment of the Obligations or to

any balance of any deposit account or credit on the books of the Administrative

Agent or any Lender in favor of the Borrower or any other person.

SECTION 5. No Discharge or Diminishment of Guarantee. The obligations

of each Guarantor hereunder shall not be subject to any reduction, limitation,

impairment or termination for any reason (other than the indefeasible payment in

full in cash of the Obligations), including any claim of waiver, release,

surrender, alteration or compromise of any of the Obligations, and shall not be

subject to any defense or setoff, counterclaim, recoupment or termination

whatsoever by reason of the invalidity, illegality or unenforceability of the

Obligations or otherwise. Without limiting the generality of the foregoing, the

obligations of each Guarantor hereunder shall not be discharged or impaired or

otherwise affected by the failure of the Administrative Agent or any Lender to

assert any claim or demand or to enforce any remedy under the Credit Agreement,

any other Loan Document or any other agreement, by any waiver or

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modification of any provision of any thereof, by any default, failure or delay,

willful or otherwise, in the performance of the Obligations, or by any other act

or omission that may or might in any manner or to the extent vary the risk of

any Guarantor or that would otherwise operate as a discharge of each Guarantor

as a matter of law or equity (other than the indefeasible payment in full in

cash of all the Obligations).

SECTION 6. Defenses of Borrower Waived. To the fullest extent permitted

by applicable law, each Guarantor waives any defense based on or arising out of

any defense of the Borrower or the unenforceability of the Obligations or any

part thereof from any cause, or the cessation from any cause of the liability of

the Borrower, other than the final and indefeasible payment in full in cash of

the Obligations. The Administrative Agent and the Lenders may, at their

election, foreclose on any security held by one or more of them by one or more

judicial or nonjudicial sales, accept an assignment of any such security in lieu

of foreclosure, compromise or adjust any part of the Obligations, make any other

accommodation with the Borrower or any other guarantor, without affecting or

impairing in any way the liability of any Guarantor hereunder except to the

extent the Obligations have been fully, finally and indefeasibly paid in cash.

Pursuant to applicable law, each Guarantor waives any defense arising out of any

such election even though such election operates, pursuant to applicable law, to

impair or to extinguish any right of reimbursement or subrogation or other right

or remedy of such Guarantor against the Borrower or any other Guarantor or

guarantor, as the case may be, or any security.

SECTION 7. Agreement to Pay; Subordination. In furtherance of the

foregoing and not in limitation of any other right that the Administrative Agent

or any Lender has at law or in equity against any Guarantor by virtue hereof,

upon the failure of the Borrower or any other Loan Party to pay any Obligation

when and as the same shall become due, whether at maturity, by acceleration,

after notice of prepayment or otherwise, each Guarantor hereby promises to and

will forthwith pay, or cause to be paid, to the Administrative Agent for the

benefit of the Lenders in cash the amount of such unpaid Obligations. Upon

payment by any Guarantor of any sums to the Administrative Agent, all rights of

such Guarantor against the Borrower arising as a result thereof by way of right

of subrogation, contribution, reimbursement, indemnity or otherwise shall in all

respects be subordinate and junior in right of payment to the prior indefeasible

payment in full in cash of all the Obligations. In addition, any indebtedness of

the Borrower now or hereafter held by any Guarantor is hereby subordinated in

right of payment to the prior payment in full in cash of the Obligations. If any

amount shall erroneously be paid to any Guarantor on account of (i) such

subrogation, contribution, reimbursement, indemnity or similar right or (ii) any

such indebtedness of the Borrower, such amount shall be held in trust for the

benefit of the Administrative Agent and the Lenders and shall forthwith be paid

to the Administrative Agent to be credited against the payment of the

Obligations, whether matured or unmatured, in accordance with the terms of the

Loan Documents.

SECTION 8. Information. Each Guarantor assumes all responsibility for

being and keeping itself informed of the Borrower's financial condition and

assets, and of all other circumstances bearing upon the risk of nonpayment of

the Obligations and the nature, scope and extent of the risks that such

Guarantor assumes and incurs hereunder, and agrees that none of the

Administrative Agent or the Lenders will have any duty to advise any of the

Guarantors of information known to it or any of them regarding such

circumstances or risks.

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SECTION 9. Representations and Warranties. Each Guarantor represents

and warrants as to itself that all representations and warranties relating to it

(as a Subsidiary of the Borrower) contained in the Credit Agreement are true and

correct as of the date made.

SECTION 10. Termination. The guarantees made hereunder (a) shall

terminate when all the Obligations have been paid in full in cash and the

Lenders have no further commitment to lend under the Credit Agreement, the LC

Exposure has been reduced to zero and the Issuing Bank has no further obligation

to issue Letters of Credit under the Credit Agreement and (b) shall continue to

be effective or be reinstated, as the case may be, if at any time payment, or

any part thereof, of any Obligation is rescinded or must otherwise be restored

by any Lender or any Guarantor upon the bankruptcy or reorganization of the

Borrower, any Guarantor or otherwise. In connection with the foregoing, the

Administrative Agent shall execute and deliver to such Guarantor or Guarantor's

designee, at such Guarantor's expense, any documents or instruments which such

Guarantor shall reasonably request from time to time to evidence such

termination and release.

SECTION 11. Binding Effect; Several Agreement; Assignments. Whenever in

this Agreement any of the parties hereto is referred to, such reference shall be

deemed to include the successors and assigns of such party; and all covenants,

promises and agreements by or on behalf of the Guarantors that are contained in

this Agreement shall bind and inure to the benefit of each party hereto and

their respective successors and