STRATEGIC AGREEMENT

Exhibit 10.9

STRATEGIC AGREEMENT

BY AND AMONG

CONNECTICUT GENERAL LIFE INSURANCE COMPANY

and

UNITED STATES PHARMACEUTICAL GROUP, LLC and
NATIONSHEALTH, INC.

as of

May 4, 2005

     This STRATEGIC AGREEMENT (this “Agreement”), dated as of May 4, 2005 (the “Effective Date”), is made and entered into by and between Connecticut General Life Insurance Company, a Connecticut corporation, (“CIGNA”), and UNITED STATES PHARMACEUTICAL GROUP, LLC, a Delaware limited liability company, (“USPG”) and NATIONSHEALTH, INC., a Delaware corporation and the indirect owner of all of the membership interest of USPG (“NationsHealth”).

     WHEREAS, the Medicare Prescription Drug Benefit program was established by Section 101 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (the “MMA”) and is codified in Sections 1860D-1 through 1860D-41 of the Social Security Act (the “Act”) and created a new Part D, known as the Voluntary Prescription Drug Benefit Program (hereinafter referred to as “Part D”);

     WHEREAS, CIGNA has submitted an application to the Centers for Medicare and Medicaid Services (“CMS”) under Part D to become a Prescription Drug Plan (“PDP”) sponsor in each of the thirty-four Part D regions designated by CMS;

     WHEREAS, subject to such approvals by CMS as may be necessary, CIGNA, USPG and NationsHealth desire to enter into an agreement in the nature of a strategic alliance, pursuant to which USPG would provide certain marketing, distribution, and enrollee service activities and expertise in connection with CIGNA’s activities as a PDP sponsor and Medicare contractor;

     WHEREAS, in entering into the relationship contemplated herein, CIGNA is desirous of becoming a shareholder and warrantholder of NationsHealth as contemplated in sections 3.02 and 3.03 of this Agreement.

     NOW, THEREFORE, in consideration of the covenants set forth in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE I
SERVICES AND OBLIGATIONS OF USPG

     SECTION 1.01 General Responsibilities . USPG shall provide to CIGNA the services (collectively, the “Services”) set forth in this Article I. The Services shall consist of the activities enumerated in Sections 1.02 through 1.06, below. The Services shall be performed, at a minimum, consistent with the timeliness, accuracy and quality standards set forth in CMS instructions and guidelines, provided, however , that the Parties may agree to standards in addition, or in excess of, those established by CMS.

     SECTION 1.02 Part D Capabilities . USPG will develop the systems and infrastructure required to perform the Services in conformance with CMS regulations and guidance, as described in Exhibit 1.02 .

     SECTION 1.03 Marketing and Beneficiary Communication . USPG will provide marketing and beneficiary communication services in conformance with CMS regulations and guidance, as described in Exhibit 1.03 and consistent with the standards of performance described therein.

     SECTION 1.04 Enrollment Billing and Premium Collection . USPG will provide Enrollee billing and collection services, including, but not limited to, Enrollee-specific premium billing, and collection information in support of financial reporting and reconciliation processes, all in conformance with CMS regulations and guidance, as described in Exhibit 1.04 and consistent with the standards of performance described therein.

     SECTION 1.05 Enrollment and Eligibility . USPG will provide Enrollee management entry point and servicing in conformance with CMS regulations and guidance, as described in Exhibit 1.05 and consistent with the standards of performance described therein. USPG will also provide disenrollment management in conformance with CMS regulations and guidance, as described in Exhibit 1.05 and consistent with the standards of performance described therein.

     SECTION 1.06 Enrollee Inquiries and Grievance Processing . USPG will be responsible for Enrollee inquiries and grievance processing in conformance with CMS regulations and guidance, as described in Exhibit 1.06 and consistent with the standards of performance described therein.

     SECTION 1.07. NationsHealth *** . NationsHealth and/or USPG will fund the NationsHealth *** described in Exhibit 1.07 .

ARTICLE II
REPRESENTATIONS AND WARRANTIES OF CIGNA;
*** OF CIGNA

     SECTION 2.01 CIGNA hereby represents and warrants to USPG and NationsHealth as follows:

          (a) Corporate Status; Authorizations . CIGNA is a corporation duly incorporated, validly existing and in good standing under the Laws of the State of Connecticut. CIGNA has the corporate power and authority, and all licenses, permits or other authorizations required for CIGNA to carry on its business as now conducted and as contemplated by this Agreement, except where the failure to possess any such authority, authorization, licenses, permits or other authorizations would not have a Material Adverse Effect. The execution, delivery and performance of this Agreement by CIGNA have been duly authorized by all necessary corporate action of CIGNA and this Agreement constitutes the valid and binding obligations of CIGNA enforceable against it in accordance with their terms, except as may be limited by bankruptcy, insolvency, moratorium or other similar Laws affecting creditors’ rights generally, and subject to general principles of equity (regardless of whether enforcement is considered in a proceeding in equity or at law).

          (b) Part D Qualification . CIGNA is a risk bearing entity licensed to provide health insurance benefits in each of the fifty states and the District of Columbia; has, or will develop, a pharmacy network that meets, or will meet, CMS access standards for a PDP sponsor; and otherwise qualifies for one or more Part D contracts.

          (c) Part D Contract Requirements . CIGNA will comply with all of the requirements imposed by any Part D Contract it executes with CMS, provided, however , that CIGNA’s failure to comply with any Part D Contract requirements will not be grounds for termination of this Agreement unless CMS terminates the Part D Contract based on CIGNA’s failure to comply.

          (d) State Licensure . CIGNA will continuously maintain all appropriate state insurance licenses, permits, or qualifications for the provision of its services to Enrollees under the PDP.

     SECTION 2.02 *** . CIGNA will develop the systems and infrastructure described in Exhibit 2.02 .

ARTICLE III
COMPENSATION AND INVESTMENT

     SECTION 3.01 Determination of Compensation . The compensation to USPG for its Services as described in this Agreement shall be determined as described in Exhibit 3. 01 .

     SECTION 3.02 Common Stock Purchase . Fourteen (14) days after the NationsHealth Funding Date, CIGNA shall purchase from NationsHealth, and NationsHealth shall issue to CIGNA, 303,030 shares of the common stock of NationsHealth (the “NHRX Common Shares”) at a purchase price of Six Dollars and Sixty Cents ($6.60) per share, for a total aggregate purchase price of One Million Nine Hundred Ninety-nine Thousand Nine Hundred Ninety-eight Dollars ($1,999,998.00). The purchase of the Common Shares and the Warrant (as defined below) shall be governed by a Securities Purchase Agreement by and between NationsHealth and CIGNA, substantially in the form attached hereto as Exhibit 3.02 , and which is being executed contemporaneously herewith.

     SECTION 3.03 Issuance of Warrants to CIGNA . Fourteen (14) days after the NationsHealth Funding Date, NationsHealth shall issue to CIGNA a Warrant (the “Warrant”) to purchase 2,936,450 shares of the common stock of NationsHealth (the “Warrant Shares”) at an exercise price of Six Dollars and Sixty Cents ($6.60) per share, in accordance with the terms and conditions of a Warrant Agreement, substantially in the form attached hereto as Exhibit 3.03 (the “Warrant Agreement”), and which is being executed contemporaneously herewith.

     SECTION 3.04 Registration Rights . The NHRX Common Shares and the Warrant Shares (when issued) shall become subject to a Registration Rights Agreement between NationsHealth and CIGNA, substantially in the form attached hereto as Exhibit 3.04 , which NationsHealth and CIGNA shall execute upon the purchase and issuance of the NHRX Common Shares.

ARTICLE IV
ADDITIONAL AGREEMENTS

     SECTION 4.01 Legal and Regulatory Compliance .

     (a) Each Party shall carry out its duties and obligations under this Agreement in material compliance with all applicable Laws. USPG shall provide Services under this Agreement to Enrollees in accordance with the terms and conditions of this Agreement and in a manner consistent with the requirements of the Medicare statutes, regulations, CMS guidance and CIGNA policies, including but not limited to CIGNA’s CMS-required compliance programs with respect to Medicare Part D, as amended from time to time, and training thereon, provided, however , that such policies and compliance programs, as amended, shall have been furnished in writing to USPG which shall have a reasonable period of time for their implementation. With respect to CIGNA policies other than CIGNA’s CMS-required compliance program, CIGNA shall not require compliance by NationsHealth in excess of that required from CIGNA’s other Part D subcontractors. USPG shall maintain all applicable licenses required to carry out its business activities and shall further comply with CIGNA policies and procedures and all applicable laws and regulations to ensure that its Services are provided in a culturally competent manner to Enrollees, including those with limited English proficiency or reading skills, diverse cultural and ethnic backgrounds, and physical or mental disabilities.

     (b) In the event that USPG is required by regulatory authorities to obtain additional licenses necessary to permit it to perform the Services, or USPG determines that it is required to obtain such licenses, or in the event that CIGNA concludes in good faith after reasonable investigation that USPG is required to obtain such licenses, and USPG does not possess such licenses, then USPG shall have a period of ninety (90) days within which to file applications for such licenses. If, after one hundred twenty (120) days from the last day of such ninety (90) day period USPG does not possess at least seventy-five (75%) percent of such licenses, then CIGNA shall be entitled to terminate this Agreement For Cause pursuant to Section 6.05(a), provided, however , that in such instance the notice requirement and cure period contained in Section 6.05(a) shall not apply.

     (c) In the event that USPG is ordered or otherwise formally requested by regulatory authorities to cease performing any of the Services, then USPG shall cease performing such Services in accordance with such order or formal request.

     (d) If either of the events described in subsections (b) or (c), above, occurs, CIGNA may, pursuant to Section 7.04(a)(iv), directly or through a third party, solicit and/or service Part D Enrollees in the state(s) or jurisdictions(s) with respect to which USPG is unable to so solicit and/or service because of its lack of licensure or the application of a governmental order or formal request that it cease such activities in such state(s) or jurisdiction(s).

     (e) To the extent that USPG seeks to obtain applicable licenses, even if it is uncertain whether Governmental Authorities require, or will require such licenses, then USPG’s *** in obtaining such licenses shall be *** under this Agreement.

     SECTION 4.02 Inspection, Audit and Acceptance .

          (a) CIGNA, its Affiliates, and CMS shall have the right, directly or through their designated auditors, at all reasonable times to inspect, audit, or otherwise evaluate the work performed or being performed by USPG, its supporting policies and procedures, including those related to data security, disaster recovery and back-up, as well as all data supplied, in the performance of this Agreement. If any inspection or evaluation is made by CIGNA or CMS on the premises of USPG or any of USPG’s suppliers, USPG or its suppliers shall provide at no additional charge all reasonable facilities and assistance for the safety and convenience of the personnel conducting the inspection or evaluation. The Secretary of Health and Human Services, the Comptroller General of the U.S. Government Accountability Office, or their designees shall have the right during the term of this Agreement and for a period of ten (10) years after termination of this Agreement or the date of the audit completion, whichever is later, to audit, evaluate, or inspect any books, contracts, medical records, documents, papers, enrollee documentation, and other records of USPG, related entity, subcontractor, or transferee that pertain to any aspect of the Services provided under this Agreement, or as the Secretary may deem necessary to enforce the applicable Medicare Contract between CMS and CIGNA. Any audit, evaluation, or inspection covered by this Section 4.02(a) shall be at no additional charge to CIGNA, but each Party will be responsible for its own labor and out of pocket expenses. USPG and NationsHealth further represent, warrant, and covenant to CIGNA that, in connection with the performance of the Services hereunder, USPG and/or NationsHealth will not hold Enrollees liable for fees that are the responsibility of CIGNA.

          (b) All Services provided by USPG for CIGNA, its Affiliates, and the Enrollees shall be in accordance with the requirements of this Agreement, including all schedules, annexes, exhibits and attachments, and shall be subject to rejection if such Services are nonconforming. No inspection or evaluation performed by CIGNA, its Affiliates, or CMS shall in any way relieve USPG of its obligation to furnish all required Services in strict accordance with the requirements of this Agreement. If any of the Services do not conform to the requirements of this Agreement, CIGNA shall have the right to require USPG to take such steps as are reasonably necessary to bring its performance into compliance including, but not limited to, requiring USPG to perform the work or services again in conformity with the applicable requirements at no cost to CIGNA or CMS.

     SECTION 4.03 Representations and Covenants of USPG and NationsHealth .

          (a) Contracting Capacity . USPG and NationsHealth represent, warrant and covenant that (1) as to themselves and their principals within the last five years, and (2) their employees and subcontractors that will be assigned to perform Services hereunder within the five-year period preceding their initial performance hereunder, to USPG and NationsHealth’s Knowledge: (i) are not debarred, suspended, proposed for debarment or suspension, or otherwise excluded or declared ineligible for the award of contracts by or participation in any Federal program, department or agency; (ii) have not been charged with, convicted of or had a civil judgment rendered against them for: commission of a fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public (Federal, state, or local) contract or subcontract; dishonesty or breach of trust including but not limited to violation of Federal or state antitrust statutes, commission of a fraud including but not limited to mail fraud or false repre

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sentations, violation of fiduciary relationship, securities offenses, embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, tax evasion, or receiving stolen property; (iii) have not been indicted for, or otherwise criminally or civilly charged by a government entity (Federal, state, or local) with, commission of any of the offenses enumerated in this Section; (iv) have not had one or more public agreements or transactions (Federal, state, or local) terminated for cause or default; and (v) have not been excluded from participation for a federal program, including but not limited to, Medicare, Medicaid, federal health care programs or federal behavioral health care programs pursuant to Title XI of the Social Security Act, 42 U.S.C. § 1320a-7 and other applicable federal statutes. USPG and NationsHealth also represent, warrant, and covenant to CIGNA that USPG and/or NationsHealth have or will duly obtain all intellectual property rights necessary to perform its obligations under this Agreement. USPG and NationsHealth’s certification in this Section is a material representation of fact upon which CIGNA relied when this Agreement was entered into by the Parties. USPG and/or NationsHealth shall provide immediate written notice to CIGNA if, at any time during the term of this Agreement, USPG and/or NationsHealth learns that its certification in this Section was erroneous on the Effective Date of this Agreement or has become erroneous by reason of new or changed circumstances. If the circumstances causing such certification to be erroneous are curable, then USPG and NationsHealth shall have forty-five (45) days to cure such circumstances. Furthermore, if the circumstances causing such certification to be erroneous relate to a non-compliant employee or subcontractor in connection with Section 4.03(a)(2), above, then USPG and NationsHealth shall be deemed to have timely cured such circumstances, so long as USPG and/or NationsHealth completely removes such employee or subcontractor from performing any Services hereunder immediately upon learning that such employee or subcontractor is non-compliant with this Section. Subject to the foregoing cure provisions, if it is later determined that USPG’s and/or NationsHealth’s certification in this Section was erroneous on the Effective Date of this Agreement or has become erroneous by reason of new or changed circumstances, in addition to other remedies available to CIGNA, CIGNA may terminate this Agreement for convenience, at its sole discretion.

          (b) Corporate Status; Authorizations . NationsHealth and USPG, respectively, are a corporation and a limited liability company duly incorporated or organized, validly existing and in good standing under the Laws of the state of Delaware. NationsHealth and USPG have the corporate power and authority, and all licenses, permits or other authorizations required to carry on their businesses as now conducted and as contemplated by this Agreement, except where the failure to possess any such authority, authorization, licenses, permits or other authorizations would not have a Material Adverse Effect and except as set forth on Exhibit 4.03(b) . The execution, delivery and performance of this Agreement by NationsHealth and USPG have been duly authorized by all necessary corporate action and this Agreement constitutes the valid and binding obligations of NationsHealth and USPG enforceable against them in accordance with their terms, except as may be limited by bankruptcy, insolvency, moratorium or other similar Laws affecting creditors’ rights generally, and subject to general principles of equity (regardless of whether enforcement is considered in a proceeding in equity or at law).

     SECTION 4.04 Warranting and Certification of Data . Certain of the data (the “CMS data”) furnished by USPG or NationsHealth in connection with its performance of its obligations under this Agreement will be used by CIGNA to obtain payments from CMS, to support

CIGNA’s bids for Medicare Program renewals and contracts with CMS in future years, or both. CIGNA and CMS will be acting in reliance on the accuracy, completeness, and truthfulness of any CMS data USPG or NationsHealth provides. USPG and NationsHealth agree to warrant the accuracy, completeness, and truthfulness of the CMS data it furnishes pursuant to this Agreement to CMS and to indemnify and hold CIGNA harmless for any payments made by CIGNA and any damages or liabilities caused by the negligence or willful misconduct of USPG or NationsHealth or that of their employees or agents in connection with providing inaccurate, incomplete, or untruthful CMS data. Any CMS data that are provided pursuant to this Agreement on a monthly, quarterly, or annual basis shall be certified by the duly authorized Chief Executive Officer, the Chief Financial Officer or other officer of USPG who reports directly to NationsHealth’s Chief Executive Officer or Chief Financial Officer. With respect to any data furnished by USPG and/or NationsHealth that CIGNA or its Affiliates will incorporate into data certified to CMS such certification shall state:

“I hereby certify that the data, information and statements set forth herein are accurate, complete, truthful and current to the best of my knowledge, information, and belief after reasonable investigation with respect thereto, and are made in good faith.

     SECTION 4.05 Compliance with Grievance Requirements . If and to the extent that USPG processes Enrollee grievances, then USPG shall cooperate and comply with all requirements of Medicare and CIGNA regarding the processing of Enrollee grievances as defined under Part D and accompanying CMS regulations, including the obligation to provide information (including medical records and other pertinent information) to CIGNA within the time frame reasonably requested for such purpose, and shall process such grievances in accordance with Exhibit 1.06 .

     SECTION 4.06 Privacy and Security of Certain Data .

     (a) The Parties expect to be responsible for obtaining, analyzing, storing, transmitting, and reporting Protected Health Information, as defined in regulations, 45 CFR Parts 160 and 164, implementing the Health Insurance Portability and Accountability Act of 1996, Pub. L. 104-191 (“HIPAA”). The Parties agree to comply with all applicable Federal and State privacy and security laws including but not limited to the requirements of HIPAA and its implementing regulations and 42 CFR § 423.136 as more fully described in the Business Associate Agreement in the form attached as Exhibit 4.06 to be executed by the Parties with respect to Enrollee data and other protected information.

     (b) The parties recognize that USPG and NationsHealth are able to provide important health-related products and services that may add value for Enrollees, but which may not be part of CIGNA’s plan of benefits, that may be part of an Enrollee’s treatment, or provide a kind of alternative treatment or therapy that may be helpful to Enrollees. Accordingly, and in a manner consistent with applicable state and federal law, including HIPAA, CIGNA agrees that it will work with USPG and NationsHealth over the next one hundred twenty (120) days to develop a plan that: (i) directly provides Enrollees with information concerning USPG and NationsHealth

Part B Supplies in a form approved by USPG and NationsHealth, and (ii) seeks to obtain appropriate authorizations from Enrollees authorizing CIGNA to share Protected Health Information with USPG and NationsHealth such that USPG and NationsHealth may provide appropriate information to Enrollees regarding USPG and NationsHealth Part B Supplies. Any plan to directly provide Enrollees with information concerning USPG and NationsHealth products shall be subject to any applicable regulatory and marketing requirements, including but not limited to those set forth in 42 C.F.R. § 423.50 that may require the approval of CMS, as determined in the reasonable discretion of CIGNA. In the event that CMS disapproves any plan to directly provide Enrollees with information concerning USPG and NationsHealth products, such disapproval shall not affect or change any of the Parties’ respective rights and obligations under the Agreement, and such disapproval shall not constitute a breach of the Agreement by CIGNA, or give rise to any right of termination or rescission or amendment of the Agreement in any manner by any Party.

     SECTION 4.07 Assignment and Subcontracting . Except as described on Exhibit 4.07 , USPG and NationsHealth are solely responsible for the provision of the Services and their other obligations under this Agreement. Neither USPG nor NationsHealth may assign or transfer, in whole or in part, these obligations, any interest in this Agreement or any claim under this Agreement. Neither the entirety nor any part of this Agreement or any task order may be further subcontracted by USPG or NationsHealth without the prior written consent of CIGNA.

     SECTION 4.08 Advance Consent to Assignment Among Affiliates of CIGNA . USPG and NationsHealth consent in advance to CIGNA’s assignment or transfer of all or part of its rights and obligations of under this Agreement to any CIGNA subsidiary or Affiliate (including any successor company of CIGNA pursuant to a reorganization by CIGNA and one or more of its Affiliates). Any such assignment and transfer shall be effective upon delivery of a written notice of assignment by CIGNA to USPG or NationsHealth and shall be subject to Section 11.05 of this Agreement.

     SECTION 4.09 Delegation of Duties . The parties acknowledge that CIGNA oversees and is accountable to CMS for any functions or responsibilities described in CMS’ Medicare Program regulations and, upon becoming a sponsor of the PDP, will monitor the performance of USPG on an ongoing basis. USPG and NationsHealth shall perform their obligations under this Agreement in a manner consistent with and in compliance with CIGNA’s contractual obligations under CIGNA’s Medicare contract with CMS. In the event that CIGNA delegates to USPG or NationsHealth any function or responsibility imposed pursuant to CIGNA’s contract with CMS, such delegation shall be subject to the requirements set forth in 42 C.F.R.§ 423.505(i)(4), as they may be amended over time. In addition, any delegation by USPG or NationsHealth of functions or responsibilities imposed pursuant to this Agreement shall be subject to the prior written approval of CIGNA and shall also be subject to the requirements set forth in 42 C.F.R. § 423.505(i)(4), as they may be amended over time. USPG and NationsHealth shall promptly supplement and amend their permitted subcontracts to include CMS’ requirements applicable to subcontractors. USPG and NationsHealth agree that CIGNA or its Affiliates may, at their option, outsource various functions of its Medicare contract with CMS.

     SECTION 4.10 Document Retention, Audit Rights . Each Party shall retain, in accordance with standard and accepted practices, such financial, accounting, and administrative re

cords related to the services it is obligated to provide under this Agreement for such period as is necessary to comply with applicable Law, but in no event less than ten (10) years after the date such documents and information are created or obtained, or longer under the conditions enumerated in 42 CFR§ 423.505(e)(4). Subject to applicable Law, during the term of this Agreement CIGNA, on one hand, and USPG and NationsHealth, on the other hand, may reasonably conduct (or have conducted on its behalf), at its own expense, one audit each year of the other Party with respect to relevant documents and data in the possession of such other Party and with reasonable access to relevant personnel of such other Party upon reasonable notice solely for the purposes of confirming compliance with obligations undertaken pursuant to this Agreement including those that are required to be reported to an applicable government agency; provided , however , that such audits may be performed more frequently to the extent necessary to respond to a request by CMS or another government agency. The terms of the confidentiality provisions set forth in Article VII hereof shall apply to any such audits. Such audit rights will be available following termination of this Agreement to the extent necessary to respond to a request by a customer, Governmental Authority, provider or other relevant party and for a Party’s need to manage litigation and to determine compliance with this Agreement or applicable Laws.

     SECTION 4.11 Ownership of Assets . Notwithstanding any other provision of this Agreement, each Party shall maintain ownership of its own assets.

     SECTION 4.12 Organization of Committee . The parties shall organize the Committee to facilitate the implementation and operating efficiency of the activities described in this Agreement, which Committee shall meet monthly or at such intervals as the Parties may agree.

ARTICLE V
SEPARATE PRODUCT OFFERINGS: FUTURE ENDEAVORS

     SECTION 5.01 Sale of Other Products and Services by USPG or NationsHealth . CIGNA acknowledges that NationsHealth and USPG are in the business of selling other services and supplies including, but not limited to, Part B Supplies reimbursable by the Medicare Program. Nothing in this Agreement is intended to foreclose USPG or NationsHealth from conducting such other businesses or offering such products and services, including, but not limited to, Part B Supplies. Notwithstanding the foregoing in no event shall NationsHealth or USPG market any service or supply on a targeted basis directly to Enrollees of CIGNA Employer Groups. Notwithstanding anything in this Agreement to the contrary, except as provided for in Section 5.03, in no event shall NationsHealth or USPG, in the course of providing services under this Agreement or in connection with an Enrollee interaction initiated with or by NationsHealth or USPG concerning coverage or services under the PDP, solicit, refer, recommend or direct Enrollees to utilize NationsHealth or USPG for any Medicare Part B goods or services or other goods or services. Nothing contained in this Agreement shall apply to current or prospective enrollees in the CIGNA Healthcare of Arizona Medicare Advantage Prescription Drug Plan or to any other Medicare Advantage Prescription Drug Plan that CIGNA or its Affiliates, or NationsHealth and USPG, may acquire, offer, administer, insure or otherwise provide, or to non-Part D products or services offered by CIGNA or NationsHealth and/or USPG, provided, however , that CIGNA agrees that it will not directly, or through a contract on CIGNA’s behalf, market the Part B Supplies of a Part B supplier other than NationsHealth to Persons who are enrolled in Medicare Part B, except as such activities are conducted by CIGNA as of the Effective Date.

     SECTION 5.02 Prohibition on Discount Card Marketing to Part D-Eligible Enrollees . From *** through *** NationsHealth and USPG shall not market any drug discount card directly to Part D-eligible individuals.

     SECTION 5.03 Future Endeavors . The Parties agree that there may be additional opportunities to jointly offer products and services *** such products and services, in a manner that capitalizes on the strengths and efficiencies of each Party. In connection with potential future endeavors, the Parties agree to the undertakings described in Exhibit 5.03 .

ARTICLE VI
AGREEMENT CONTINGENT;
TERM AND TERMINATION

     SECTION 6.01 Agreement Contingent on CMS Acceptance of CIGNA Applications . This Agreement is expressly contingent upon CMS’ acceptance of the applications submitted by CIGNA and the award of Part D contracts to CIGNA.

     SECTION 6.02 Agreement Contingent on NationsHealth Funding of *** and NationsHealth *** .

     (a)  Required NationsHealth Funding . By the later of (i) the date that is *** after the Effective Date or (ii) the date that is *** after CMS approves the PDP (the “NationsHealth Funding Date”) NationsHealth and/or USPG will have received *** in funds available to support the Services, or NationsHealth and/or USPG will have entered into a binding credit agreement or loan agreement with a term of at least twelve (12) months with a lender or other financial institution providing NationsHealth and/or USPG with total proceeds or borrowing availability, together with any funds realized from the sale of equity or from other sources, of at least *** (exclusive of financing expenses) to fund the *** and the NationsHealth *** as necessary to make the PDP fully operational. The proceeds of such loan agreement or credit agreement shall be available to be drawn down by USPG and/or NationsHealth on the NationsHealth Funding Date. The *** to be provided by NationsHealth and/or USPG on the NationsHealth Funding Date shall be evidenced by either of the following:

     (i) the deposit by NationsHealth or USPG of the sum of at least *** in an escrow account subject to an escrow agreement, control agreement, or similar arrangement limiting withdrawals to the funding of *** and/or NationsHealth ***; or

     (ii) the execution by NationsHealth and/or USPG of a binding credit agreement or loan agreement with MHR Capital Partners LP, or any of its Affiliates, or a financial institution rated “A” or better by Standard and Poor’s, or by another financing source reasonably acceptable to CIGNA, which credit agreement or loan agreement shall expressly permit the draw down of proceeds of at least *** (less any proceeds realized by NationsHealth or USPG from the sale of equity or from other sources) to pay for the *** and the NationsHealth ***.

     (b) Elections Available to CIGNA in the Absence of Funding by NationsHealth . If, on the NationsHealth Funding Date, NationsHealth and/or USPG, for any reason, have not obtained

cash proceeds or borrowing availability, together with any funds realized from the sale of equity or from other sources, of at least *** (exclusive of financing expenses) or are not able to commence actual payment of the *** and the NationsHealth *** as necessary to make the PDP fully operational, then CIGNA shall be entitled to, in its sole discretion, elect one or more of the following items (i), (ii), (iii) or (iv):

     (i) terminate this Agreement pursuant to Section 6.05(a), below, provided, however , that the notice requirement and cure period contained therein shall not apply;

     (ii) remove all exclusivity obligations by CIGNA to NationsHealth and/or USPG, including, without limitation, the commitment described in Section 7.04(a), below;

     (iii) terminate, without any liability to CIGNA, that certain Securities Purchase Agreement dated May 4, 2005, by and between NationsHealth and CIGNA, which termination shall not affect the Warrant Agreement dated May 4, 2005 executed by NationsHealth for the benefit of CIGNA or the Warrants issued by NationsHealth to CIGNA pursuant thereto; or,

     (iv) modify the terms of this Agreement to provide all of the following:

     SECTION 6.03 Term of this Agreement . The initial term of this Agreement shall be from the Effective Date until December 31, 2009.

     SECTION 6.04 Termination . Each Party may terminate this Agreement For Cause by providing written notice to the other Party, provided, however , that neither of USPG or NationsHealth may cause a termination of this Agreement by providing a notice of termination to the other. If For Cause notice is given regarding any of the events set forth in Section 6.05(a), (b), (c), (d), and (h) the effective date of termination shall be either (i) the expiration of the applicable cure period, or (ii) if there is no applicable cure period, forty-five (45) days after the date written notice of termination is received by the other Party. In the event a For Cause notice is given regarding any of the events set forth in Section 6.05(e), (f) or (g), the effective date of termination will be the date that such notice is received by the other Party.

          SECTION 6.05 For Cause . “For Cause” termination shall mean the following:

          (a) As to a nonbreaching Party, the other Party’s breach of any of the terms

          and conditions of this Agreement that causes a Material Adverse Effect on the non-breaching Party, and remains uncured following written notice and a reasonable opportunity to cure, which shall not be less than ninety (90) days from the date of written notice of such breach.

          (b) As to any Party, if the PDP, at the end of then most recent CMS contract year, has fewer than *** Enrollees (excluding CIGNA Employer Group members and Dual Eligibles).

          (c) As to any Party, if the then-most recently completed two CMS contract years cumulative experience results in a Net Loss.

          (d) As to a nonbreaching Party, if a default occurs on a payment required to

          be made by the breaching Party relating to the PDP.

          (e) As to a nonbreaching Party, if a Party is adjudicated to have committed fraud in a civil proceeding or otherwise settles a civil fraud action involving the United States for a material amount, or a criminal action is filed by a governmental agency against a Party arising out of, or relating to, the PDP, or a Party is excluded or debarred from participation in any federal or state health care program pursuant to 42 U.S.C. § 1320a-7.

          (f) As to a nonbreaching Party, if a Party: (i) is unable to pay its debts generally as they become due; (ii) makes a voluntary assignment for the benefit of creditors; (iii) is declared insolvent in any proceeding; (iv) commences a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself, any of its property, assets or debts under any bankruptcy, insolvency or other similar laws now or hereafter in effect or petitions or applies to any tribunal for the appointment of a receiver, liquidator, custodian or trustee for such Party under any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, liquidation, or dissolution law of any jurisdiction now or hereafter in effect; or (v) is named as a debtor party in such petition, application, case or proceeding and it indicates its approval thereof, consents thereto, acquiesces therein or acts in furtherance thereof, or if such petition, application, case or proceeding is not dismissed or stayed for a period of sixty (60) days after it is commenced, or is the subject of any order appointing any such receiver, liquidator, custodian or trustee or approving the petition in any such case or proceeding.

          (g) If a Party undergoes a change in control which shall be defined as a transfer of all, or substantially all, of the Party’s assets, or a transfer of more than (i) *** as to CIGNA, or (ii) *** as to NationsHealth or USPG, of the voting control of their respective securities, in a single transaction or a series of transactions intended to effect a change in control of such Party then the Party not undergoing such change in control may deem a For Cause termination to have occurred, provided, however that a reorganization by a Party and one or more of its Affiliates for administrative or similar purposes shall not be deemed a change in control and provided further that as to USPG and/or NationsHealth this provision shall be limited to a change in control such

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that USPG and/or NationsHealth would be substantially controlled by a health plan or pharmacy benefit provider or another entity that substantially competes with, or operates a business that substantially conflicts with, CIGNA.

          (h) As to any Party, as to which any existing Law governing the Part D program is changed, or if a new Law relating to Part D is enacted or promulgated, and the effect of such changed or new Law would cause a Material Adverse Effect on such Party.

     SECTION 6.06 Optional Extension of Counter-Party Performance in Connection With Early Termination .

          (a) Early Termination for Failure to Meet Enrollee Threshold, Net Loss . Following the termination of this Agreement prior to the initial term described in Section 6.03 pursuant to Section 6.05 (b) or (c) above, either party shall, at the election of the other party, agree to honor the terms and conditions of this Agreement through December 31 of the year following the year in which the termination is effective, or such shorter time as the party requesting performance may specify, provided however , that if such a continuation of performance creates a substantial financial hardship to USPG, then the parties shall meet and confer in good faith concerning potential compensation to ***.

          (b) Early Termination for Other Reasons . Following the termination of this Agreement prior to the initial term described in Section 6.03 pursuant to Section 6.05 (a), (d),(e), (f),(g) and (h), above, the party subject to a termination For Cause shall, at the election of the other party, agree to honor the terms and conditions of this Agreement through December 31 of the year following the year in which the termination is effective, or such shorter time as the party requesting performance may specify, provided however , that if such a continuation of performance creates a substantial financial hardship to USPG, then the parties shall meet and confer in good faith concerning potential compensation to ***.

     SECTION 6.07 Effect of Termination or Expiration of Agreement Upon Enrollees; Contingent Financial Settlement; Option to Acquire Servicing Assets; No Loss of Rights in Cardholder Data; No Preclusion on Marketing by USPG and NationsHealth .

          (a) Post-Termination Re-Enrollment . Upon termination or expiration of this Agreement other than with respect to a termination by CIGNA of NationsHealth and/or USPG pursuant to Sections 6.05(a),(d), (e) (except that for purposes of this Subsection 6.07(a) the criminal action referred to in (e) must result in a conviction of NationsHealth) and (f), if NationsHealth or USPG (or NationsHealth or USPG and a third party or parties) is the sponsor or is a contractor, in a material capacity, for a CMS-approved PDP (the “NationsHealth PDP”) and *** within thirty (30) days of termination of this Agreement (or such longer period as the Parties may agree) *** that otherwise would be automatically *** for the then-next open ***, then the Parties will effect such *** and any other activities necessary to support such *** in accordance with terms of such approval and applicable Law, including, without limitation, HIPAA, pursuant to which, CIGNA shall provide NationsHealth and/or USPG with *** to the extent necessary to enable NationsHealth and/or USPG to *** the NationsHealth PDP *** as of the date of termination of this Agreement. ***:

     (i) *** a prescription card program offered or operated by NationsHealth and/or USPG prior to October 1, 2005, or *** Part B Supplies from NationsHealth prior to October 1, 2005, *** of the Parties no later than June 30, 2006.

     (ii) *** (*** through a procedure agreed upon by the Parties, except where *** is impracticable or inappropriate, such as where it would result in *** Part D plans) *** of CIGNA Employer Groups.

          (b) Contingent Financial Settlement . If the NationsHealth PDP is precluded by CMS or by applicable Law from ***, above, or CMS does not grant its express authorization or approval as described in (a), above, then, at the end of each calendar quarter *** following the termination of ***:

     (i) NationsHealth shall pay CIGNA *** of CIGNA’s Employer Groups *** in any NationsHealth PDP.

     (ii) CIGNA shall pay NationsHealth or USPG ***:

     (1) *** otherwise would have been *** the NationsHealth PDP under subsection ***, above;

     (2) *** where USPG and/or NationsHealth *** pursuant to Section 4.01(b), above; and,

     (3) *** in the CIGNA PDP for ***.

     (iii) For (A) *** not identified in subsections *** and ***, above,(for example, *** as a consequence of ***) and (B) excluding CIGNA Employer Group *** NationsHealth shall consist of *** for those *** (as to which CIGNA shall exercise reasonable diligence, but no less effort than it would with respect to ***) in CIGNA’s PDP for such plan year, less *** (as to which NationsHealth and/or USPG shall exercise reasonable diligence, but no less effort than it would with respect to ***) in the NationsHealth PDP. In the event that *** in the NationsHealth PDP *** in CIGNA’s PDP, then NationsHealth shall ***.

          (c) Option to Acquire Servicing Assets . In the event of a termination of this Agreement by CIGNA For Cause pursuant to subsections (a), (d), (e), (f) and (g) of Section 6.05, above, or in the event that USPG and NationsHealth change their business operations such that they no longer offer the Services, then CIGNA shall have the option to acquire, which option must be exercised within thirty (30) days of the final date on which USPG renders Services pursuant to this Agreement, the assets required to deliver all or part of the Services described in Exhibits 1.02, 1.03, 1.04, 1.05 , and 1.06 . CIGNA shall have the option to acquire such physical assets from USPG and/or NationsHealth at their fair market value. NationsHealth may decline to sell such physical assets to CIGNA, in which instance CIGNA may acquire similar assets from third party vendors. NationsHealth and/or USPG will provide know how, expertise, and personnel resources to assist CIGNA, without cost to CIGNA, in replicating the functionality of such assets. Prior to the effective date of such termination, CIGNA may notify USPG or NationsHealth of CIGNA’s intent to exercise such option so that the transfer of such assets will occur

simultaneously with the termination. Further, in the event of such termination, CIGNA shall have the option to acquire from USPG and/or NationsHealth, without cost to CIGNA, the intangible assets required to deliver all or part of the Services, including system specifications and configurations, software code, training and policy manuals, marketing plans and other information used by USPG or NationsHealth in the performance of the Services described in the foregoing exhibits through a grant by USPG and/or NationsHealth to CIGNA of a royalty-free perpetual license for such intangible assets to the extent of the authority of USPG and/or NationsHealth to grant such a license.

          (d) No Loss of Rights in Cardholder Data; No Preclusion on Marketing by USPG and NationsHealth . No termination of this Agreement shall be deemed by CIGNA to constitute a transfer or assignment by USPG or NationsHealth to CIGNA of data developed by USPG or NationsHealth concerning participants in NationsHealth’s prescription card program or to constitute a prohibition on marketing activities by NationsHealth or USPG with respect to such participants.

          (e) Inapplicability of Post-Termination *** Arrangements and Contingent Financial Settlement to CIGNA as a Result of a Termination For Cause by NationsHealth . Upon the termination of this Agreement by NationsHealth pursuant to Sections 6.05(a), (d), (e) (except that for purposes of this Subsection 6.07(e) the criminal action referred to in (e) must result in a conviction of CIGNA) and (f), then those provisions of subsections 6.07 (a) and (b), above, entitling CIGNA to post-termination *** and a contingent financial settlement, shall not apply to CIGNA.

ARTICLE VII
CONFIDENTIALITY; USE OF INTELLECTUAL PROPERTY;
ENROLLEE DATA; EXCLUSIVITY

     SECTION 7.01 Confidentiality . Prior to entering into this Agreement the Parties have each committed substantial resources to developing the arrangements described in this Agreement. The Parties specifically acknowledge that to induce each other to enter into this Agreement each Party specifically confirms that all Confidential Information received from the other party at any time shall remain confidential during the term of this Agreement and shall be used only in furtherance of the business relationships contemplated by the provisions of this Agreement. In this regard, each Party agrees that any Confidential Information provided to it will only be provided to its employees on a “need to know” basis, and will be treated with at least as much care as the receiving party provides for its own Confidential Information (and in no event treated with any less than a high degree of confidentiality.)

     SECTION 7.02 Use of Proprietary Information .

          (a) Notwithstanding anything to the contrary in this Agreement, NationsHealth and USPG reserves all right, title and interest in and to, and all control of the use of NationsHealth or USPG’s copyrights, patents, service marks, trademarks, designs, logos, brand names, Internet “URL” addresses, World Wide Web sites and all right, title and interest in and to any trade names, fictitious business names, and all other intellectual property rights (collectively, “NationsHealth/USPG Intellectual Property”), including all right, title and interest, including any

license rights it has, in and to the name of NationsHealth or USPG, and any derivation thereof and including NationsHealth/USPG New Intellectual Property (as defined below). CIGNA shall not, and shall ensure that CIGNA’s Affiliates do not, use any of NationsHealth/USPG Intellectual Property in materials supplied to Employer Groups, prospective Employer Groups, Enrollees or otherwise without NationsHealth’s and USPG’s express and specific prior written consent. To the extent applicable, CIGNA hereby assigns, transfers and conveys irrevocably and perpetually to NationsHealth or USPG all of its worldwide right, title and interest in and to any and all NationsHealth/USPG Intellectual Property. “NationsHealth/USPG New Intellectual Property” means all developed materials and other intellectual property that (a) are conceived, created or developed in connection with or in the course of providing the Services and are modifications, enhancements, adaptations or derivative works of or derived from or based on the NationsHealth Data or any NationsHealth/USPG Intellectual Property in all cases, regardless of who makes such modifications, enhancements, adaptations and derivative works but specifically excluding modifications, enhancements, adaptations or derivative works of or derived from or based on the CIGNA Data or any CIGNA Intellectual Property, or (b) are conceived, created or developed to address, execute or embody a NationsHealth/USPG-specific product, service, business process, including any modifications, enhancements, adaptations and/or derivative works of or based on any of the foregoing, in all cases, regardless of who conceives, creates, develops or makes any of the foregoing. For the avoidance of doubt, “NationsHealth/USPG New Intellectual Property” does not include CIGNA Intellectual Property generally applicable to CIGNA’s business.

          (b) Notwithstanding anything to the contrary in this Agreement, CIGNA and its Affiliates reserve all right, title and interest in and to, and all control of the use of, CIGNA’s copyrights, patents, service marks, trademarks, designs, logos, brand names, Internet “URL” addresses, World Wide Web sites and all right, title and interest in and to any trade names, fictious business names and all other intellectual property rights (collectively “CIGNA Intellectual Property”) including all right, title and interest, including any license rights it has, in and to the names “CIGNA,” “CIGNA HealthCare,” “CIGNA Companies,” “Connecticut General Life Insurance Company,” and any derivation thereof and including CIGNA New Intellectual Property. USPG and NationsHealth shall not, and shall ensure that USPG’s and NationsHealth’s Affiliates do not, use any CIGNA Proprietary Information in materials supplied to Employer Groups, prospective Employer Groups, Enrollees or otherwise without CIGNA’s prior express and specific prior written consent. To the extent applicable, USPG and NationsHealth hereby assign, transfer and convey irrevocably and perpetually to CIGNA all of their worldwide right, title and interest in and to any and all CIGNA Intellectual Property. “CIGNA New Intellectual Property” means all developed materials and other intellectual property that (a) are conceived, created or developed in connection with or in the course of providing the Services and are modifications, enhancements, adaptations or derivative works or derived from or based on the CIGNA Data or CIGNA Confidential Information or any CIGNA Intellectual Property in all cases, regardless of who makes such modifications, enhancements, adaptations and derivative works of or derived from or based on the CIGNA Data or any CIGNA Intellectual Property but specifically excluding modifications, enhancements, adaptations and derivative works derived from or based on the NationsHealth Data or any NationsHealth /USPG Intellectual Property, or (b) are conceived, created or developed to address, execute or embody a CIGNA-specific product, service, business process, including any modifications, enhancements, adaptations and/or derivative works of or based on any of the foregoing, in all cases, regardless of who conceives, creates, develops or makes any of

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the foregoing. For the avoidance of doubt, “CIGNA New Intellectual Property” does not include NationsHealth/USPG Intellectual Property generally applicable to USPG’s or NationsHealth’s business.

     SECTION 7.03 Data . The use and management of CIGNA Data by USPG and/or NationsHealth shall be as described in Exhibit 7.03 . The use and management of NationsHealth Data by CIGNA shall be as described in Exhibit 7.03 .

     SECTION 7.04 Exclusivity .

          (a) Exclusive Rights of USPG . USPG shall be CIGNA’s exclusive provider of the Services described in Article I of this Agreement that pertain to Part D Enrollees, provided, however , that this shall not prevent CIGNA from engaging in, or acquiring capabilities, to engage in the following:

               (i) CIGNA shall have the option to service its Part D Enrollees in CIGNA’s Employer Groups through its own servicing operations or through servicing operations provided by a third party;

               (ii) CIGNA may provide its pharmacy benefit management capability to third parties on a “leased” or fee basis;

               (iii) CIGNA may provide its pharmacy benefit management capability and risk taking capacity to third parties who market and service products within discrete local markets and which may include a direct-to-consumer Part D program as described under Section 101 the MMA; and

               (iv) CIGNA may, directly or through a third party, solicit and/or service Part D Enrollees if USPG is legally prohibited from marketing the PDP to enrollees of its non-endorsed prescription card and Medicare Part B programs, or is unable to perform the Services described in Article I of this Agreement, or experiences (or NationsHealth experiences) a change in control as described in Section 6.05(g), or in connection with circumstances described in Section 4.01(d) (relating to USPG’s failure to possess certain licenses or the issuance to USPG of a cease and desist order or similar formal regulatory request.)

               (v) CIGNA may use a third party to market the CIGNA PDP to prospective Enrollees provided that CIGNA offers to USPG the opportunity to perform, and USPG agrees to perform, all Services under this Agreement with respect to such prospective Enrollees except for the marketing services that are provided by such third party. If USPG agrees to perform the Services, then such prospective Enrollees, to the extent that they become Enrollees, will be counted in the Parties’ calculations as described in Exhibit 3.01 . If USPG rejects CIGNA’s offer as described above, then USPG shall not perform Services for CIGNA with respect to such Enrollees and such Enrollees shall not be counted in the Parties’ calculations as described in Exhibit 3.01 .

          (b) Exclusive Rights of CIGNA CIGNA shall be the exclusive PDP sponsor for which USPG or NationsHealth provides any Services as described in Article I of this Agreement.