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<TITLE>FORM S-1</TITLE>
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

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<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">As filed with the Securities and
    Exchange Commission on September&#160;29, 2009</FONT></B>
</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">Registration
    No.&#160;333-&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</FONT></B>
</DIV>

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<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 13pt">UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 11pt">Washington,&#160;D.C.
    20549</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

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<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 17pt"><FONT style="white-space: nowrap">Form&#160;S-1</FONT></FONT></B>
</DIV>

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    <B><FONT style="font-size: 11pt">REGISTRATION
    STATEMENT</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 11pt">UNDER</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 11pt">THE SECURITIES ACT OF
    1933</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

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<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 22pt">ACCRETIVE HEALTH,
    INC.</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <I><FONT style="font-size: 7pt">(Exact Name of Registrant as
    Specified in Its Charter)</FONT></I>
</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
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<TR style="font-size: 1pt" valign="bottom">
    <TD width="34%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="32%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="32%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
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<TR valign="bottom">
<TD align="center" valign="top">
    <B>Delaware<BR>
    </B><I><FONT style="font-size: 7pt">(State or Other Jurisdiction
    of<BR>
    Incorporation or Organization)</FONT></I>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <B>7389<BR>
    </B><I><FONT style="font-size: 7pt">(Primary Standard
    Industrial<BR>
    Classification Code No.)</FONT></I>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <B>02-0698101<BR>
    </B><I><FONT style="font-size: 7pt">(I.R.S. Employer<BR>
    Identification No.) </FONT></I>
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">401 North Michigan
    Avenue</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">Suite&#160;2700</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">Chicago, Illinois
    60611</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">(312)&#160;324-7820</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <I><FONT style="font-size: 7pt">(Address, including zip code,
    and telephone number, including area code, of registrant&#146;s
    principal executive offices)</FONT></I>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

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<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">Mary A. Tolan</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">Founder, President and Chief
    Executive Officer</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">401 North Michigan
    Avenue</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">Suite&#160;2700</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">Chicago, Illinois
    60611</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">(312)&#160;324-7820</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <I><FONT style="font-size: 7pt">(Name, address, including zip
    code, and telephone number, including area code, of agent for
    service)</FONT></I>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

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<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I><FONT style="font-size: 9pt">Copies to:</FONT></I></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
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    <TD width="50%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="49%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
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<!-- Table Width Row END -->
<TR valign="bottom">
<TD align="center" valign="top">
    <B>David A. Westenberg,&#160;Esq.<BR>
    Wilmer Cutler Pickering Hale and Dorr LLP<BR>
    60 State Street<BR>
    Boston, Massachusetts 02109<BR>
    <FONT style="white-space: nowrap">(617)&#160;526-6000</FONT></B>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <B>Gregory A. Fernicola,&#160;Esq.<BR>
    Jennifer A. Bensch,&#160;Esq.<BR>
    Skadden, Arps, Slate, Meagher &#038; Flom LLP<BR>
    Four Times Square<BR>
    New York, New York 10036<BR>
    <FONT style="white-space: nowrap">(212)&#160;735-3000</FONT>
    </B>
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B>Approximate date of commencement of proposed sale to the
    public:</B>&#160;&#160;As soon as practicable after this
    Registration Statement is declared effective.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

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<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    If any of the securities being registered on this form are
    offered on a delayed or continuous basis pursuant to
    Rule&#160;415 under the Securities Act of 1933, as amended (the
    &#147;Securities Act&#148;) please check the following
    box.&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    If this Form is filed to register additional securities for an
    offering pursuant to Rule&#160;462(b) under the Securities Act,
    please check the following box and list the Securities Act
    registration statement number of the earlier effective
    registration statement for the same
    offering.&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    If this Form is a post-effective amendment filed pursuant to
    Rule&#160;462(c) under the Securities Act, please check the
    following box and list the Securities Act registration statement
    number of the earlier effective registration statement for the
    same
    offering.&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    If this Form is a post-effective amendment filed pursuant to
    Rule&#160;462(d) under the Securities Act, please check the
    following box and list the Securities Act registration statement
    number of the earlier effective registration statement for the
    same
    offering.&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Indicate by check mark whether the registrant is a large
    accelerated filer, an accelerated filer, a non-accelerated
    filer, or a smaller reporting company. See the definitions of
    &#147;large accelerated filer&#148;, &#147;accelerated
    filer&#148; and &#147;smaller reporting company&#148; in
    Rule&#160;12b2 of the Exchange Act.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 04 -->

<TR>
    <TD width="25%"></TD>
    <TD width="25%"></TD>
    <TD width="25%"></TD>
    <TD width="25%"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">    <FONT style="font-size: 9pt; font-family: Arial, Helvetica">Large
    accelerated
    filer&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT>
    </FONT></TD>
    <TD nowrap align="center">    <FONT style="font-size: 9pt; font-family: Arial, Helvetica">
    Accelerated
    filer&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT>
    </FONT></TD>
    <TD nowrap align="center">    <FONT style="font-size: 9pt; font-family: Arial, Helvetica">
    Non-accelerated
    filer&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#254;</FONT>
    </FONT></TD>
    <TD nowrap align="right">    <FONT style="font-size: 9pt; font-family: Arial, Helvetica">
    Smaller reporting
    company&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT>
    </FONT></TD>
</TR>

</TABLE>

<DIV align="center" style="margin-left: 32%; margin-right: 50%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <FONT style="font-size: 7pt">(Do not check if a smaller
    reporting company)
    </FONT>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 16%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=540 length=90 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">CALCULATION OF REGISTRATION
    FEE</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="50%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutterright -->
    <TD width="23%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterright -->
    <TD width="23%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
    <B>Proposed Maximum<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
    <B><FONT style="font-size: 9pt">Each Class of<BR>
    </FONT></B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B><FONT style="font-size: 9pt">Aggregate Offering<BR>
    </FONT></B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B><FONT style="font-size: 9pt">Amount of<BR>
    </FONT></B>
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
    <B>Securities to be Registered</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Price(1)</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Registration Fee(2)</B>
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top" style="border-top: 1px solid #000000">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Common Stock, par value $0.01 per share
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-top: 1px solid #000000">
    $200,000,000
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-top: 1px solid #000000">
    $11,160
</TD>
</TR>
<TR style="font-size: 1pt">
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD valign="top">
    <FONT style="font-size: 9pt">(1)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Estimated solely for the purpose of
    computing the registration fee in accordance with
    Rule&#160;457(o) under the Securities Act of 1933, as amended.
    </FONT></TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>



<TR>
    <TD valign="top">
    <FONT style="font-size: 9pt">(2)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Calculated pursuant to
    Rule&#160;457(o) based on an estimate of the proposed maximum
    aggregate offering price.
    </FONT></TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 16%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=540 length=90 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B>The Registrant hereby amends this Registration Statement on
    such date or dates as may be necessary to delay its effective
    date until Registrant shall file a further amendment which
    specifically states that this Registration Statement shall
    thereafter become effective in accordance with Section&#160;8(a)
    of the Securities Act or until the Registration Statement shall
    become effective on such date as the Commission, acting pursuant
    to Section&#160;8(a), may determine.</B>
</DIV>

<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=540 length=0 -->

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 2pt solid #000000"></CENTER><!-- callerid=999 iwidth=540 length=0 -->

<P align="left" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 94%; margin-left: 3%"><!-- BEGIN PAGE WIDTH -->

<TABLE style="color: #FF0000" width="100%" border="1" cellpadding="5"><!-- TABLE 03 --><TR><TD style=text-align:justify>
<FONT style="font-size: 8pt; font-family: Arial, Helvetica; color: #E8112D">The
information in this prospectus is not complete and may be
changed. We may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is
effective. This prospectus is not an offer to sell these
securities and it is not soliciting offers to buy these
securities in any state where the offer or sale is not
permitted.<BR>
</FONT>
</TD></TR></TABLE>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>
</DIV><!-- END PAGE WIDTH -->
<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <FONT style="color: #E8112D">Subject to Completion, dated
    September&#160;29, 2009
    </FONT>
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <FONT style="font-size: 14pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Shares
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <IMG src="c53658c5365813.gif" alt="(ACCRETIVE HEALTH LOGO)"><FONT style="font-size: 14pt">
    </FONT>
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <FONT style="font-size: 14pt">Common Stock
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    This is an initial public offering of shares of common stock of
    Accretive Health, Inc.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accretive Health is
    offering&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    of the shares to be sold in the offering. The selling
    stockholders identified in this prospectus are
    offering&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares.
    Accretive Health will not receive any of the proceeds from the
    sale of the shares being sold by the selling stockholders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to this offering, there has been no public market for our
    common stock. It is currently estimated that the initial public
    offering price per share will be between
    $&#160;&#160;&#160;&#160;&#160; and
    $&#160;&#160;&#160;&#160;&#160;. We intend to apply to have our
    common stock listed on the New York Stock Exchange under the
    symbol &#147;AH&#148;.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <I>See &#147;Risk Factors&#148; beginning on page&#160;12 to
    read about factors you should consider before buying shares of
    our common stock.</I>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 19%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=456 length=90 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B>Neither the Securities and Exchange Commission nor any other
    regulatory body has approved or disapproved of these securities
    or passed upon the accuracy or adequacy of this prospectus. Any
    representation to the contrary is a criminal offense.</B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 19%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=456 length=90 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="81%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <FONT style="font-size: 10pt">Per Share
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <FONT style="font-size: 10pt">Total
    </FONT>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Initial public offering price
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Underwriting discount
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proceeds, before expenses, to Accretive Health
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proceeds, before expenses, to the selling stockholders
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    To the extent that the underwriters sell more
    than&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock, the underwriters have the option to purchase up
    to an
    additional&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    from Accretive Health and the selling stockholders at the
    initial public offering price less the underwriting discount.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 19%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=456 length=90 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The underwriters expect to deliver the shares against payment in
    New York, New York
    on&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2009.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 04 -->

<TR>
    <TD width="50%"></TD>
    <TD width="50%"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">    <B><FONT style="font-size: 16pt; font-family: Arial, Helvetica">Goldman,
    Sachs&#160;&#038; Co.</FONT></B></TD>
    <TD nowrap align="right">    <B><FONT style="font-size: 16pt; font-family: Arial, Helvetica">
    Credit Suisse</FONT></B></TD>
</TR>

</TABLE>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 04 -->

<TR>
    <TD width="50%"></TD>
    <TD width="50%"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">    <B><FONT style="font-size: 16pt; font-family: Arial, Helvetica">J.P.&#160;Morgan</FONT></B></TD>
    <TD nowrap align="right">    <B><FONT style="font-size: 16pt; font-family: Arial, Helvetica">
    Morgan Stanley</FONT></B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 19%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=456 length=90 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prospectus
    dated&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2009.
</DIV>

<P align="left" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">TABLE OF
    CONTENTS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: Arial, Helvetica">Prospectus
    </FONT>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<DIV align="left">
<!-- TOC -->
</DIV>

<DIV align="left">
<A name="tocpage"></A>
</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="97%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <FONT style="font-size: 10pt">Page
    </FONT>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#101'>Prospectus Summary</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#102'>Summary Consolidated Financial Data</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#103'>Risk Factors</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#104'>Special Note Regarding Forward-Looking
    Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    28
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#105'>Industry and Market Data</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    28
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#106'>Use of Proceeds</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    29
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#107'>Dividend Policy</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#108'>Capitalization</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#109'>Dilution</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#110'>Selected Consolidated Financial Data</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#111'>Management&#146;s Discussion and Analysis of
    Financial Condition and Results of Operations</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#112'>Business</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    64
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#113'>Management</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    88
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#114'>Related Person Transactions</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    106
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#115'>Principal and Selling Stockholders</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    113
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#116'>Description of Capital Stock</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    116
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#117'>Shares Eligible for Future Sale</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    121
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#118'>Certain U.S. Federal Tax Consequences to
    <FONT style="white-space: nowrap">Non-U.S.</FONT>
    Holders</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    124
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#119'>Underwriting</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    127
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#120'>Legal Matters</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    131
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#121'>Experts</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    131
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#122'>Where You Can Find More Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    131
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Index to Consolidated Financial Statements
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv3w1.htm">EX-3.1</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv3w3.htm">EX-3.3</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w1.htm">EX-10.1</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w2.htm">EX-10.2</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w4.htm">EX-10.4</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w5.htm">EX-10.5</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w6.htm">EX-10.6</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w7.htm">EX-10.7</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w8.htm">EX-10.8</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w9.htm">EX-10.9</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w10.htm">EX-10.10</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w11.htm">EX-10.11</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w12.htm">EX-10.12</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w13.htm">EX-10.13</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w14.htm">EX-10.14</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w15.htm">EX-10.15</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w16.htm">EX-10.16</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w18.htm">EX-10.18</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w19.htm">EX-10.19</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv10w20.htm">EX-10.20</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c53658exv23w1.htm">EX-23.1</A></FONT></TD></TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left">
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</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

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<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B>Through and
    including&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2009 (the 25th&#160;day after the date of this prospectus), all
    dealers effecting transactions in these securities, whether or
    not participating in this offering, may be required to deliver a
    prospectus. This is in addition to a dealer&#146;s obligation to
    deliver a prospectus when acting as an underwriter and with
    respect to an unsold allotment or subscription.</B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 19%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=456 length=90 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    No dealer, salesperson or other person is authorized to give any
    information or to represent anything not contained in this
    prospectus. You must not rely on any unauthorized information or
    representations. This prospectus is an offer to sell only the
    shares offered hereby, but only under circumstances and in
    jurisdictions where it is lawful to do so. The information
    contained in this prospectus is current only as of its date.
</DIV>

<P align="left" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
<A name='101'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">PROSPECTUS
    SUMMARY</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <I>This summary highlights information contained elsewhere in
    this prospectus. You should read the following summary together
    with the more detailed information appearing in this prospectus,
    including our consolidated financial statements and related
    notes, and the risk factors beginning on page&#160;12, before
    deciding whether to purchase shares of our common stock. Unless
    the context otherwise requires, we use the terms &#147;Accretive
    Health&#148;, &#147;our company&#148;, we&#148;, &#147;us&#148;
    and &#147;our&#148; in this prospectus to refer to Accretive
    Health, Inc. and its subsidiaries.</I>
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive
    Health</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Overview</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accretive Health is a leading provider of healthcare revenue
    cycle management services. Our business purpose is to help
    U.S.&#160;hospitals, physicians and other healthcare providers
    manage their revenue cycle operations more efficiently. Our
    integrated, end-to-end technology and services offering, which
    we refer to as our solution, helps our customers realize
    sustainable improvements in their operating margins and improve
    the satisfaction of their patients, physicians and staff. We
    enable these improvements by helping our customers increase the
    portion of the maximum potential patient revenue they receive
    while reducing total revenue cycle costs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our customers typically are multi-hospital systems, including
    faith-based or community healthcare systems, academic medical
    centers and independent ambulatory clinics, and their affiliated
    physician practice groups. We seek to develop strategic,
    long-term relationships with our customers and focus on
    providers that we believe understand the value of our operating
    model and have demonstrated success in both clinical and
    operational outcomes. As of June&#160;30, 2009, we provided our
    integrated revenue cycle service offerings to 21 customers
    representing 53 hospitals and $11.9&#160;billion in annual net
    patient revenue, as well as physicians&#146; billing
    organizations associated with several of these customers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Grounded in sophisticated analytics, our solution spans our
    customers&#146; entire revenue cycle, unlike competing services
    that address only a portion of the revenue cycle. We are not a
    traditional outsourcing company focused solely on one-time cost
    reductions. Through the implementation of our distinctive
    operating model that includes people, processes and technology,
    our customers can generate significant and sustainable revenue
    cycle improvements. Our service offerings are adaptable to
    evolution of the healthcare regulatory environment, technology
    standards and market trends, and require no up-front cash
    investment by our customers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    To implement our solution, we assume full responsibility for the
    management and cost of a customer&#146;s revenue cycle
    operations and supplement the customer&#146;s existing revenue
    cycle staff with seasoned Accretive Health personnel. We
    collaborate with our customers&#146; revenue cycle employees
    with the objective of educating and empowering them so that over
    time they can deliver improved results using our tools. We and
    our customers share financial gains resulting from our solution,
    which directly aligns our objectives and interests with those of
    our customers. We believe that, over time, this alignment of
    interests fosters greater innovation and incentivizes us to
    improve our customers&#146; revenue cycle operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The revenue cycle operations of a typical hospital, physician or
    other healthcare provider often fail to capture and collect the
    total amounts owed to it from third-party payors and patients
    for medical services rendered, leading to significant bad debt
    write-offs, uncompensated care, payor denials and corresponding
    administrative write-offs, as well as lost revenue for missed
    charges. Fitch Ratings estimates that in 2008 uncompensated care
    (including bad debt write-offs, charity care and uninsured
    discounts) averaged 17% of net patient revenue at
    U.S.&#160;hospitals. We deliver operating margin improvements to
    our customers through a combination of improvements in
    collections, which we refer to as net revenue yield, charge
    capture and revenue cycle cost reductions. Our customers have
</DIV>
</DIV><!-- End box 1 -->

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    <BR>
    1
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    historically achieved significant net revenue yield improvements
    within 18 to 24&#160;months of implementing our solution, with
    customers operating under mature managed service contracts
    realizing 400 to 600&#160;basis points in yield improvements,
    typically in the third or fourth contract year.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We seek to embed our technology, personnel, know-how and culture
    within each customer&#146;s revenue cycle activities with the
    expectation that we will serve as the customer&#146;s
    <FONT style="white-space: nowrap">on-site</FONT>
    operational manager beyond the managed service contract&#146;s
    initial term, which typically ranges from four to five years. To
    date, we have experienced a contract renewal rate of 100%
    (excluding exploratory new services offerings, a consensual
    termination following a change of control and a customer
    reorganization). Coupled with the long-term nature of our
    managed service contracts and the fixed nature of the base fees
    under each contract, our historical renewal experience provides
    a core source of recurring revenue.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our net services revenue consists primarily of base fees and
    incentive fees. We receive base fees for managing our
    customers&#146; revenue cycle operations, net of any cost
    savings we share with those customers. Incentive fees represent
    our portion of the increase in our customers&#146; net patient
    revenue resulting from our services. We generate a portion of
    our operating margin as a result of the difference between the
    fixed base fees and the variable costs of the revenue cycles
    that we manage. Incentive fees are a smaller portion of overall
    revenue than base fees but generally contribute directly to
    operating margin, thus significantly impacting our
    profitability. We closely monitor each customer&#146;s revenue
    cycle performance through periodic operating reviews. A
    customer&#146;s net revenue improvements and cost savings
    generally increase over time as we deploy additional programs
    and as the programs we implement become more effective, which in
    turn provides visibility into our future revenue and
    profitability. In 2008, for example, approximately 80% of our
    net services revenue, and over 95% of our net income, was
    derived from customer contracts that were in place as of
    January&#160;1, 2008. In 2008, we had net services revenue of
    $398.5&#160;million, representing growth of 65.5% over 2007 and
    a compound annual growth rate of 53.0% since January&#160;1,
    2005. In addition, we were profitable for the years ended
    December&#160;31, 2007 and 2008 and the six months ended
    June&#160;30, 2009, and our profitability increased in each of
    those periods.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Market
    Opportunity</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We believe that current macroeconomic conditions will continue
    to impose financial pressure on healthcare providers and will
    increase the importance of managing their revenue cycles
    effectively and efficiently. The market opportunity for our
    services&#160;&#151; which we define as the total amount of net
    patient revenue collected annually by U.S.&#160;hospitals and
    physicians&#146; billing organizations&#160;&#151; exceeds
    $750&#160;billion. We expect this market opportunity will
    continue to grow. According to the Centers for Medicare and
    Medicaid Services of the U.S.&#160;Department of Health and
    Human Services, expenditures for hospitals and physician and
    clinical services are expected to increase between 2009 and 2018
    at annual rates of approximately 6.4% and 5.4%, respectively.
    Additionally, the continued operating pressures facing
    U.S.&#160;hospitals coupled with some of the underlying themes
    of current healthcare reform proposals make the efficient
    management of the revenue cycle and collection of the full
    amount of payments due for patient services among the most
    critical challenges facing healthcare providers today.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We believe that the inability of healthcare providers to capture
    and collect the total amounts owed to them for patient services
    are caused by the following trends:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Complexity of Revenue Cycle Management.</I>&#160;&#160;At
    most hospitals, there is a lack of standardization across
    operating practices, payor and patient payment methodologies,
    data management processes and billing systems.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Lack of Integrated Systems and
    Processes.</I>&#160;&#160;Although interrelated, the individual
    steps in the revenue cycle continuum are not operationally
    integrated across revenue cycle departments at many hospitals.
</TD>
</TR>

</TABLE>
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    2
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Increasing Patient Financial Responsibility for Healthcare
    Services.</I>&#160;&#160;Hospitals are being forced to adapt to
    the need for direct-to-patient billing and collections
    capabilities as patients bear payment responsibility for an
    increasing portion of healthcare costs. Hospitals have
    traditionally focused on collecting payments from insurance
    companies and from state and federal payors, and typically are
    less familiar with the processes necessary to collect payments
    from patients at the point of service, including the use of
    alternative payment options.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Outdated Systems and Insufficient Resources to Upgrade
    Them.</I>&#160;&#160;Many hospitals suffer from operating
    inefficiencies caused by outdated technology, increasingly
    complex billing requirements, a general lack of standardization
    of process and information flow, costly in-house services that
    could be more economically outsourced, and an increasingly
    stringent regulatory environment.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">The Accretive
    Health Solution</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our solution is intended to address the full spectrum of revenue
    cycle operational issues faced by healthcare providers. We
    deliver improved operating margins to our customers through
    improved revenue cycle operations. During the assessment phase
    of the customer relationship, we identify specific areas for
    improvement and begin implementation upon execution of a managed
    services contract. Improvements in charge capture and
    collections are typically attributable to reduced payor denials,
    identification of additional items that can be billed to payors
    based on the actual procedures performed, identification of
    insurance for a higher percentage of otherwise uninsured
    patients, and improved collections of patient balances after
    insurance. Revenue cycle cost reductions are typically achieved
    through operating efficiencies, including streamlining work
    flow, automating processes and centralizing vendor activities.
    Specific sources of margin improvement vary among customers.
    While improvements in net revenue yield generally represent the
    majority of a customer&#146;s operating margin improvement, we
    are able to deliver additional margin improvement through
    revenue cycle cost reductions. Because our managed service
    contracts align our interests with those of our customers, we
    are able, over time, to improve our margins along with those of
    our customers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We believe that our proprietary technology, management
    experience and well-developed processes are enhanced by the
    knowledge and experience we gain working with a wide range of
    customers and improve with each payor reimbursement or patient
    pay transaction. Our proprietary technology applications include
    workflow automation and direct payor connection capabilities
    that enable revenue cycle staff to focus on problem accounts
    rather than on manual tasks, such as searching payor websites
    for insurance and benefits verification for all patients. We
    employ &#147;exception based logic&#148; technology that
    provides the same interface for all users and automates a host
    of tasks that otherwise can consume a significant amount of
    staff time. We use real-time feedback from our customers to
    improve the functionality and performance of our technology and
    processes and incorporate these improvements into our service
    offerings on a regular basis. We strive to apply operational
    excellence throughout the entire revenue cycle.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We adapt our solution to the hospital&#146;s organizational
    structure in order to minimize disruption to existing staff and
    to make our services transparent to both patients and
    physicians. The experience and knowledge of the senior
    management personnel we provide to our customers can improve the
    performance of their in-house revenue cycle staff. Our objective
    is to improve the operating performance of our customers, thus
    generating incentive fees for ourselves, by:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Improving Net Revenue Yield.</I>&#160;&#160;We help our
    customers improve their net revenue yield. Through the use of
    our proprietary technologies and methodologies, we precisely
    calculate each customer&#146;s improvement in net revenue yield.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Increasing Charge Capture.</I>&#160;&#160;We help our
    customers increase their charge capture by implementing
    optimization techniques and related processes.
</TD>
</TR>

</TABLE>
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Making Revenue Cycle Operations More
    Efficient.</I>&#160;&#160;We help our customers make their
    revenue cycle operations more efficient by implementing advanced
    technologies, streamlining operations, avoiding unnecessary
    re-work and improving quality.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We employ a variety of techniques intended to achieve our
    objectives for our customer:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Gathering Complete Information.</I>&#160;&#160;We focus on
    gathering complete patient information and educating the patient
    as to his or her potential financial responsibilities before
    receiving care so the services can be recorded and billed to the
    appropriate parties. We believe that hospitals employing our
    services have increased the percentage of non-emergency
    in-patient admissions with complete information profiles to
    nearly 100%, enabling fewer billing delays, increased charge
    capture and reduced billing cycles.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Improving Claims Filing and Third-Party Payor
    Collections.</I>&#160;&#160;We implement sophisticated analytics
    designed to improve claims filing and collection of claims from
    third-party insurance payors. By employing proprietary
    algorithms and modeling to determine how hospital revenue cycle
    staff should allocate time and resources across a pool of
    outstanding claims, we can increase the likelihood that patient
    services will be reimbursed.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Identifying Alternative Payment Sources.</I>&#160;&#160;We
    use various methods to find payment sources for uninsured
    patients and reimbursement for services not covered by
    third-party insurance. After a typical implementation period, we
    have been able to help our customers find a third-party payment
    source for approximately 85% of all admitted patients who
    identified themselves as uninsured.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Employing Proprietary Technology and
    Algorithms.</I>&#160;&#160;Our service offerings employ a
    variety of proprietary data analytics and predictive modeling
    algorithms. Our systems are designed to streamline work
    processes through the use of proprietary algorithms that focus
    revenue cycle staff effort on those accounts deemed to have the
    greatest potential for improving net revenue yield or charge
    capture.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Using Analytical Capabilities and Operational
    Excellence.</I>&#160;&#160;We draw on the experience that we
    have gained from working with many of the best healthcare
    provider systems in the United States to train hospital staffs
    about new and innovative revenue cycle management practices.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Our
    Strategy</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our goal is to become the preferred provider-of-choice for
    revenue cycle management services in the U.S.&#160;healthcare
    industry. Since our inception, we have worked with some of the
    largest and most prestigious healthcare systems in the United
    States, such as Ascension Health, the Henry Ford Health System
    and the Dartmouth-Hitchcock Medical Center. Going forward, our
    goal is to continue to expand the scope of our services to
    hospitals within our existing customers&#146; systems as well as
    to leverage our strong relationships with reference customers to
    continue to attract business from new customers. Key elements of
    our strategy include the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    delivering tangible, long-term results for our customers by
    providing end-to-end services across the entire revenue cycle;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    continuing to develop innovative approaches to increase the
    yield on patient-owed obligations for medical services received;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enhancing and developing proprietary algorithms to identify
    potential errors and to make process corrections in the
    collection of reimbursements from third-party payors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    expanding our shared services program;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    hiring, training and retaining our personnel;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    continuing to diversify our customer base;&#160;and
</TD>
</TR>

</TABLE>
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    4
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    developing enhanced service offerings that offer us long-term
    opportunities.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Risks Associated
    with Our Business</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our business is subject to a number of risks which you should be
    aware of before making an investment decision. Those risks are
    discussed more fully in &#147;Risk Factors&#148; beginning on
    page&#160;12. For example:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we may not be able to maintain or increase our profitability,
    and our recent growth rates may not be indicative of our future
    growth rates;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    hospitals affiliated with Ascension Health account for a
    majority of our net services revenue;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we face competition from the internal revenue cycle management
    staff of hospitals as well as from a variety of external
    participants in the revenue cycle market;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if we are unable to retain our existing customers, or if our
    customers fail to renew their managed service contracts with us
    upon expiration, our financial condition will suffer;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    existing and prospective government regulation of the healthcare
    industry creates risks and challenges for our business.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Corporate
    Information</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We were incorporated in Delaware under the name Healthcare
    Services, Inc. in July 2003 and changed our name to Accretive
    Health, Inc. in August 2009. Our principal executive offices are
    located at 401 North Michigan Avenue, Suite&#160;2700, Chicago,
    Illinois 60611, and our telephone number is
    <FONT style="white-space: nowrap">(312)&#160;324-7820.</FONT>
    Our website address is www.accretivehealth.com. Information
    contained on our website is not incorporated by reference into
    this prospectus, and you should not consider information
    contained on our website to be part of this prospectus or in
    deciding whether to purchase shares of our common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accretive Health, the Accretive Health logo, AHtoAccess,
    AHtoCharge, AHtoContract, AHtoLink, AHtoPost, AHtoRemit,
    AHtoScribe, AHtoScribe Administrator, AHtoTrac, A2A, Charge
    Integrity Services, Medicaid Eligibility Hub, YBFU, Yield-Based
    Follow Up and other trademarks or service marks of Accretive
    Health appearing in this prospectus are the property of
    Accretive Health.
</DIV>
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    5
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">The
    Offering</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="36%"></TD>
    <TD width="1%"></TD>
    <TD width="63%"></TD>
</TR>

<TR>
    <TD valign="top">
    Common stock offered by Accretive Health</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Common stock offered by the selling stockholders</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Common stock to be outstanding after this offering</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Use of proceeds</TD>
    <TD></TD>
    <TD valign="bottom">
    We intend to use approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million of our net proceeds
    of this offering to pay the preferred stock liquidation
    preferences that will be paid in cash to the holders of our
    outstanding preferred stock concurrently with the conversion of
    such shares into shares of our common stock upon the closing of
    this offering. We intend to use the remainder of our net
    proceeds of this offering for general corporate purposes, which
    may include financing our growth, developing new services and
    funding capital expenditures, acquisitions and investments. We
    will not receive any proceeds from the shares sold by the
    selling stockholders. See &#147;Use of Proceeds&#148; for more
    information.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Risk Factors</TD>
    <TD></TD>
    <TD valign="bottom">
    You should read the &#147;Risk Factors&#148; section and other
    information included in this prospectus for a discussion of
    factors to consider carefully before deciding to invest in
    shares of our common stock.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Proposed New York Stock Exchange symbol</TD>
    <TD></TD>
    <TD valign="bottom">
    &#147;AH&#148;</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The number of shares of our common stock to be outstanding after
    this offering is based on shares of common stock outstanding as
    of June&#160;30, 2009 after giving effect to the assumptions in
    the following paragraph, and excludes:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    833,334&#160;shares of common stock issuable upon the exercise
    of warrants outstanding and exercisable as of June&#160;30, 2009
    at a weighted-average exercise price of $1.12 per share, which
    will remain outstanding after this offering if not exercised
    prior to this offering;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    2,440,885&#160;shares of common stock issuable upon the exercise
    of stock options outstanding and exercisable as of June&#160;30,
    2009 at a weighted-average exercise price of $21.59 per share,
    of which 1,054,930&#160;shares with a weighted-average exercise
    price of $8.52 per share would be vested if purchased upon
    exercise of these options as of June&#160;30, 2009;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    173,828&#160;shares of common stock available for future
    issuance under our equity compensation plans as of June&#160;30,
    2009;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an
    additional&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock that will be made available for future
    issuance under our equity compensation plans upon the closing of
    this offering.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Except as otherwise noted, all information in this prospectus:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    assumes no exercise by the underwriters of their option to
    purchase up to an
    additional&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    from us and the selling stockholders;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    assumes that the shares to be sold in this offering are sold at
    the initial public offering price of
    $&#160;&#160;&#160;&#160;&#160; per share, the midpoint of the
    estimated price range shown on the cover of this prospectus;
</TD>
</TR>

</TABLE>
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    6
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    gives effect to
    a&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    -for-one split of our common stock to be effected prior to the
    closing of this offering;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    gives effect to the automatic conversion of all outstanding
    shares of non-voting common stock into shares of voting common
    stock on a share-for-share basis upon the closing of this
    offering;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    gives effect to the automatic conversion of all outstanding
    shares of convertible preferred stock
    into&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock upon the closing of this offering, assuming an
    initial public offering price of $&#160;&#160;&#160;&#160;&#160;
    per share, the midpoint of the estimated price range shown on
    the cover of this prospectus;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    gives effect to our assumed issuance
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock upon exercise of warrants that will be cancelled
    if not exercised prior to this offering, assuming an initial
    public offering price of $&#160;&#160;&#160;&#160;&#160; per
    share, the midpoint of the estimated price range shown on the
    cover of this prospectus;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    gives effect to our issuance
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock to Financial Technology Partners, LLC
    <FONT style="white-space: nowrap">and/or</FONT> FTP
    Securities, LLC, whom we collectively refer to as FT Partners,
    contemporaneously with the closing of this offering for
    financial advisory services in respect of this offering,
    assuming an initial public offering price of
    $&#160;&#160;&#160;&#160;&#160; per share, the midpoint of the
    estimated price range shown on the cover of this prospectus; and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    gives effect to the restatement of our certificate of
    incorporation and amendment and restatement of our bylaws prior
    to the closing of this offering.
</TD>
</TR>

</TABLE>
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    7
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
<A name='102'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">SUMMARY
    CONSOLIDATED FINANCIAL DATA</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following tables summarize our consolidated financial data
    for the periods presented. The summary statements of operations
    for the three years ended December&#160;31, 2008 are derived
    from our audited financial statements for the three years ended
    December&#160;31, 2008 included elsewhere in this prospectus.
    The summary statements of operations for the six months ended
    June&#160;30, 2008 and 2009 and the summary balance sheet data
    as of June&#160;30, 2009 are derived from our unaudited
    financial statements included elsewhere in this prospectus. Our
    unaudited financial statements have been prepared on the same
    basis as the audited financial statements and notes thereto and,
    in the opinion of our management, include all adjustments
    (consisting of normal recurring adjustments) necessary for a
    fair statement of the information for the unaudited interim
    periods. Our historical results for prior interim periods are
    not necessarily indicative of results to be expected for a full
    year or for any future period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The pro forma balance sheet data as of June&#160;30, 2009 give
    effect to (1)&#160;the automatic conversion of all outstanding
    shares of non-voting common stock into shares of common stock
    upon the closing of this offering, (2)&#160;the automatic
    conversion of all outstanding shares of convertible preferred
    stock into shares of common stock upon the closing of this
    offering and (3)&#160;the assumed issuance
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock upon exercise of warrants that will be cancelled
    if not exercised prior to this offering. The pro forma as
    adjusted balance sheet data as of June&#160;30, 2009 give effect
    to (1)&#160;the items described in the preceding sentence,
    (2)&#160;our issuance and sale
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock in this offering at an assumed initial public
    offering price of $&#160;&#160;&#160;&#160;&#160; per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus, after deducting the estimated underwriting discount
    and offering expenses payable by us and the application of the
    net proceeds therefrom as described in &#147;Use of
    Proceeds&#148;, and (3)&#160;our issuance
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock to FT Partners contemporaneously with the
    closing of this offering, based on an assumed initial public
    offering price of $&#160;&#160;&#160;&#160;&#160; per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    You should read this data together with our consolidated
    financial statements and related notes included elsewhere in
    this prospectus and the information under &#147;Selected
    Consolidated Financial Data&#148; and &#147;Management&#146;s
    Discussion and Analysis of Financial Condition and Results of
    Operations&#148;.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="40%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Fiscal Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2006</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2009</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" nowrap align="center" valign="bottom">
    <B>(In thousands, except share and per share data)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Statement of Operations Data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net services revenue
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    160,741
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    240,725
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    398,469
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    187,261
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    238,149
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Costs of services
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    141,767
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    197,676
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    335,211
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    160,082
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    195,667
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating margin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,974
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43,049
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    63,258
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,179
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42,482
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating expenses:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Infused management and technology
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,875
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,872
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,234
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,938
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24,482
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Selling, general and administrative
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,777
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,657
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21,227
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,642
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,308
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,652
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43,529
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,461
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,580
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,790
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Income (loss) from operations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (8,678
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (480
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,797
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (401
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,692
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,359
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,710
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    710
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    433
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    83
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Income (loss) before provision for (benefit from) income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,230
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,507
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,775
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    8
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="40%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Fiscal Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2006</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2009</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" nowrap align="center" valign="bottom">
    <B>(In thousands, except share and per share data)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Provision for (benefit from) income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    456
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,264
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    626
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,439
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net income (loss)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    774
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,243
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (594
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,214
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net income (loss) per common share:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Basic:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.89
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.04
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.70
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.06
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Diluted:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1.02
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.03
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (0.73
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (0.06
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Weighted-average shares used in computing net income (loss) per
    common share:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Basic:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,611,975
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,410,226
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,214,916
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,160,187
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,337,812
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Diluted:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,611,975
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,296,011
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,214,916
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,160,187
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,492,646
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Other Operating Data (unaudited):</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Adjusted EBITDA(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,125
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,842
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12,220
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,620
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    11,658
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Net patient revenue under management (at period end) (in
    billions)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6.9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    9.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    8.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    11.9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="60%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>As of June&#160;30, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Pro Forma<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Actual</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Pro Forma</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">As Adjusted</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Balance Sheet Data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Working capital
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,114
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    105,965
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    20,537
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    We define adjusted EBITDA as net income (loss) before net
    interest income (expense), income tax expense (benefit),
    depreciation and amortization expense and share-based
    compensation expense. Adjusted EBITDA is a non-GAAP financial
    measure and should not be considered as an alternative to net
    income, operating income and any other measure of financial
    performance calculated and presented in accordance with GAAP.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    We believe adjusted EBITDA is useful to investors in evaluating
    our operating performance for the following reasons:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="3%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    adjusted EBITDA and similar non-GAAP measures are widely used by
    investors to measure a company&#146;s operating performance
    without regard to items that can vary substantially from company
    to company depending upon financing and accounting methods, book
    values of assets, capital structures and the methods by which
    assets were acquired;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    securities analysts often use adjusted EBITDA and similar
    non-GAAP measures as supplemental measures to evaluate the
    overall operating performance of companies; and
</TD>
</TR>

</TABLE>
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    9
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="3%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    by comparing our adjusted EBITDA in different historical
    periods, our investors can evaluate our operating results
    without the additional variations of interest income (expense),
    income tax expense (benefit), depreciation and amortization
    expense and share-based compensation expense.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    Our management uses adjusted EBITDA:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="3%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    as a measure of operating performance, because it does not
    include the impact of items that we do not consider indicative
    of our core operating performance;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    for planning purposes, including the preparation of our annual
    operating budget;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    to allocate resources to enhance the financial performance of
    our business;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    to evaluate the effectiveness of our business strategies; and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    in communications with our board of directors and investors
    concerning our financial performance.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    We understand that, although measures similar to adjusted EBITDA
    are frequently used by investors and securities analysts in
    their evaluation of companies, adjusted EBITDA has limitations
    as an analytical tool, and you should not consider it in
    isolation or as a substitute for analysis of our results of
    operations as reported under GAAP. Some of these limitations are:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="3%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    adjusted EBITDA does not reflect our cash expenditures or future
    requirements for capital expenditures or other contractual
    commitments;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    adjusted EBITDA does not reflect changes in, or cash
    requirements for, our working capital needs;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    adjusted EBITDA does not reflect share-based compensation
    expense;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    adjusted EBITDA does not reflect cash requirements for income
    taxes;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    adjusted EBITDA does not reflect net interest income (expense);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    although depreciation and amortization are non-cash charges, the
    assets being depreciated or amortized will often have to be
    replaced in the future, and adjusted EBITDA does not reflect any
    cash requirements for these replacements; and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    other companies in our industry may calculate adjusted EBITDA
    differently than we do, limiting its usefulness as a comparative
    measure.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    To properly and prudently evaluate our business, we encourage
    you to review the GAAP financial statements included elsewhere
    in this prospectus, and not to rely on any single financial
    measure to evaluate our business.</TD>
</TR>

</TABLE>
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    10
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    The following table presents a reconciliation of adjusted EBITDA
    to net income (loss), the most comparable GAAP measure:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="47%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Fiscal Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2006</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2009</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net income (loss)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    774
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,243
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (594
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,214
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net interest income(a)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,359
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,710
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (710
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (433
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (83
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Provision (benefit) for income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    456
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,264
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    626
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,439
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Depreciation and amortization expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    626
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,307
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,540
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    920
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,882
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    EBITDA
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (8,052
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    827
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,337
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    519
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,574
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stock compensation expense(b)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    844
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    934
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,551
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,021
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,977
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stock warrant expense(b)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    83
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,081
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,332
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,080
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,107
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Adjusted EBITDA
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,125
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,842
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12,220
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,620
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    11,658
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 5%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<DIV align="left" style="margin-left: 10%; margin-right: 0%; text-indent: -5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    &#160;(a)&#160;&#160;Net interest income represents earnings
    from our cash and cash equivalents. No debt or other
    interest-bearing obligations were outstanding during any of the
    periods presented.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 10%; margin-right: 0%; text-indent: -5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    &#160;(b)&#160;&#160;Stock compensation expense and stock
    warrant expense collectively represent the
    <FONT style="white-space: nowrap">share-based</FONT>
    compensation expense reflected in our financial statements. Of
    the amounts presented above, $83, $928, $921, $696 and $1,334
    was classified as a reduction in net services revenue for the
    years ended December&#160;31, 2006, 2007 and 2008 and the six
    months ended June&#160;30, 2008 and 2009, respectively.
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    11
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='103'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">RISK
    FACTORS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <I>An investment in our common stock involves a high degree of
    risk. In deciding whether to invest, you should carefully
    consider the following risk factors. Any of the following risks
    could have a material adverse effect on our business, financial
    condition, results of operations or prospects and cause the
    value of our common stock to decline, which could cause you to
    lose all or part of your investment. When deciding whether to
    invest in our common stock, you should also refer to the other
    information in this prospectus, including our consolidated
    financial statements and related notes and the
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations&#148; section of this
    prospectus.</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Risks Related to
    Our Business and Industry</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">We may not be
    able to maintain or increase our profitability, and our recent
    growth rates may not be indicative of our future growth
    rates.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We have been profitable on an annual basis only since the year
    ended December&#160;31, 2007, and we incurred net losses in the
    quarters ended March&#160;31, 2007, December&#160;31, 2007,
    March&#160;31, 2008, December&#160;31, 2008 and March&#160;31,
    2009 and in the six months ended June&#160;30, 2008. We may not
    succeed in maintaining our profitability on an annual basis and
    could incur quarterly or annual losses in future periods. We
    expect to incur additional operating expenses associated with
    being a public company and we intend to continue to increase our
    operating expenses as we grow our business. We also expect to
    continue to make investments in our proprietary technology
    applications, sales and marketing, infrastructure, facilities
    and other resources as we expand our operations, thus incurring
    additional costs. If our revenue does not increase to offset
    these increases in costs, our operating results would be
    negatively affected. You should not consider our historic
    revenue and net income growth rates as indicative of future
    growth rates. Accordingly, we cannot assure you that we will be
    able to maintain or increase our profitability in the future.
    Each of the risks described in this &#147;Risk Factors&#148;
    section, as well as other factors, may affect our future
    operating results and profitability. For example, factors that
    may affect our future operating results and profitability
    include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the extent to which our service offerings achieve and maintain
    market acceptance;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the failure of our existing customers to renew their managed
    service contracts with us upon expiration;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the length of our sales, contracting and implementation cycles
    for new customers;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in customer procurement policies;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the financial condition of our current and potential customers;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the amount and timing of incentive payments we receive from our
    customers for increasing their revenue yield;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the amount and timing of reductions in our customers&#146;
    revenue cycle costs that we are able to achieve;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in the average maturity of our managed service contracts
    with customers;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to hire and retain qualified personnel to meet the
    needs of our growing business;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    technical difficulties or interruptions in our services;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the entry of new competitors and the introduction of superior or
    more economical service offerings by new or existing competitors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in the regulatory environment related to healthcare and
    reimbursement for healthcare services;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    regulatory compliance costs;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    litigation involving our company, including related to our
    intellectual property;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    departures of key personnel;
</TD>
</TR>

</TABLE>

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    <BR>
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<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the timing, size and integration success of potential future
    acquisitions;&#160;and
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in general economic, industry and market conditions.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Hospitals
    affiliated with Ascension Health currently account for a
    majority of our net services revenue, and we have several
    customers that have each accounted for 10% or more of our net
    services revenue in past fiscal periods. The termination of our
    master services agreement with Ascension Health, or any
    significant loss of business from our large customers, would
    have a material adverse effect on our business, results of
    operations and financial condition.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We are party to a master services agreement with Ascension
    Health pursuant to which we provide services to its affiliated
    hospitals that execute separate managed service contracts with
    us. Hospitals affiliated with Ascension Health have accounted
    for a majority of our net services revenue each year since our
    formation. In the years ended December&#160;31, 2006, 2007 and
    2008 and the six months ended June&#160;30, 2008 and 2009,
    aggregate revenue from hospitals affiliated with Ascension
    Health were $142.6&#160;million, $214.2&#160;million,
    $281.7&#160;million, $136.7&#160;million and
    $151.6&#160;million, respectively, representing 88.7%, 89.0%,
    70.7%, 73.0% and 63.6% of our total net services revenue, which
    is the term we use for our net services revenue, in such
    periods. In some fiscal periods, individual hospitals affiliated
    with Ascension Health have each accounted for 10% or more of our
    total net services revenue. In addition, another customer, which
    is not affiliated with Ascension Health, accounted for 11.5% of
    our total net services revenue in the six months ended
    June&#160;30, 2008 and 10.6% of our total net services revenue
    in the year ended December&#160;31, 2008 but less than 10% of
    our total net services revenue in the six months ended
    June&#160;30, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    All of our managed service contracts with hospitals affiliated
    with Ascension Health will expire on December&#160;13, 2012
    unless renewed. Pursuant to the master services agreement and
    the managed service contracts with hospitals affiliated with
    Ascension Health, our fees are subject to adjustment in the
    event quarterly cash collections at these hospitals deteriorate
    materially after we take over revenue cycle management
    operations. While these adjustments have never been triggered,
    if they were, our future fees from hospitals affiliated with
    Ascension Health would be reduced. In addition, any of our other
    customers, including hospitals affiliated with Ascension Health,
    can elect not to renew their managed service contracts with us
    upon expiration. We intend to seek renewal of all managed
    service contracts with our customers, but cannot assure you that
    all of them will be renewed or that the terms upon which they
    may be renewed will be as favorable to us as the terms of the
    initial managed service contracts.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our inability to renew the managed service contracts with
    hospitals affiliated with Ascension Health, the termination of
    our master services agreement with Ascension Health, the loss of
    any of our other large customers or their failure to renew their
    managed service contracts with us upon expiration, or a
    reduction in the fees for our services for these customers would
    have a material adverse effect on our business, results of
    operations and financial condition.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Our master
    services agreement with Ascension Health requires us to offer to
    Ascension Health&#146;s affiliated hospitals service fees that
    are at least as low as the fees we charge any other similarly
    situated customer receiving comparable services at comparable
    volumes, and the master services agreement includes other
    provisions that could impede or delay our ability to enter into
    managed service contracts with new customers.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our master services agreement with Ascension Health requires us
    to offer to Ascension Health&#146;s affiliated hospitals fees
    for our services that are at least as low as the fees we charge
    any other similarly-situated customer receiving comparable
    services at comparable volumes. If we were to offer another
    similarly-situated customer receiving a comparable volume of
    comparable services fees that are lower than the fees paid by
    hospitals affiliated with Ascension Health, we would be
    obligated to offer such lower fees to hospitals affiliated with
    Ascension Health, which could have a material
</DIV>

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    <BR>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    adverse effect on our results of operations and financial
    condition. In addition, we are required to consult with
    Ascension Health&#146;s affiliated hospitals before undertaking
    services for competitors identified by them in the managed
    service contracts they execute with us. In limited
    circumstances, we have also agreed not to enter into managed
    service contracts with an existing customer&#146;s competitors
    without such customer&#146;s consent. These obligations could
    impede or delay our ability to enter into managed service
    contracts with new customers.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">The market for
    integrated, end-to-end revenue cycle solutions may develop more
    slowly than we expect, which could adversely affect our revenue
    and our ability to maintain or increase our
    profitability.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our success depends, in part, on the willingness of hospitals,
    physicians and other healthcare providers to implement
    integrated, end-to-end revenue cycle solutions. Some hospitals
    may be reluctant or unwilling to implement our solution for a
    number of reasons, including failure to perceive the need for
    improved revenue cycle operations and lack of knowledge about
    the potential benefits our solution provides. Even if potential
    customers recognize the need for improved revenue cycle
    operations, they may not select an integrated, end-to-end
    revenue cycle solution such as ours because they previously have
    made investments in internally developed solutions and choose to
    continue to rely on their own internal revenue cycle management
    staff. As a result, the market for integrated, end-to-end
    revenue cycle solutions may develop more slowly than we expect,
    which could adversely affect our revenue and our ability to
    maintain or increase our profitability.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">We operate in
    a highly competitive industry, and our current or future
    competitors may be able to compete more effectively than we do,
    which could have a material adverse effect on our business,
    revenue, growth rates and market share.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The market for revenue cycle management solutions is highly
    competitive and we expect competition to intensify in the
    future. We face competition from the internal revenue cycle
    management staff of hospitals, as described above. We also
    compete with external participants in the revenue cycle market,
    including software-as-a-service or other technology-supported
    revenue cycle management business process outsourcing companies;
    traditional consultants; and information technology outsourcers.
    Our competitors may be able to respond more quickly and
    effectively than we can to new or changing opportunities,
    technologies, standards, regulations or customer requirements.
    We may not be able to compete successfully with these companies,
    and these or other competitors may introduce technologies or
    services that render our technologies or services obsolete or
    less marketable. Even if our technologies and services are more
    effective than the offerings of our competitors, current or
    potential customers might prefer competitive technologies or
    services to our technologies and services. Increased competition
    is likely to result in pricing pressures, which could negatively
    impact our margins, growth rate or market share.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">If we are
    unable to retain our existing customers, our financial condition
    will suffer.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our success depends in part upon the retention of our customers,
    particularly Ascension Health and its affiliated hospitals. We
    derive our net services revenue primarily from managed service
    contracts pursuant to which we receive base fees and incentive
    payments. Customers can elect not to renew their managed service
    contracts with us upon expiration. If a managed service contract
    is not renewed or is terminated for any reason, we will not
    receive the payments we would have otherwise received over the
    life of contract. In addition, financial issues or other changes
    in customer circumstances, such as a customer change in control,
    may cause us or the customer to seek to modify or terminate a
    managed service contract, and either we or the customer may
    generally terminate a contract for material uncured breach by
    the other. If we breach a managed service contract or fail to
    perform in accordance with contractual service levels, we may
    also be liable to the customer for damages. Any of these events
    could adversely affect our business, financial condition,
    operating results and cash flows.
</DIV>

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    <BR>
    14
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">We face a
    variable selling cycle to secure new managed service contracts,
    making it difficult to predict the timing of specific new
    customer relationships.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We face a variable selling cycle, typically spanning six to
    twelve months, to secure a new managed service contract. Even if
    we succeed in developing a relationship with a potential new
    customer, we may not be successful in entering into a managed
    service contract with that customer. In addition, we cannot
    accurately predict the timing of entering into managed service
    contracts with new customers due to the complex procurement
    decision processes of most healthcare providers, which often
    involves high-level or committee approvals. Consequently, we
    have only a limited ability to predict the timing of specific
    new customer relationships.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Delayed or
    unsuccessful implementation of our technologies or services with
    our customers or implementation costs that exceed our
    expectations may harm our financial results.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    To implement our solution, we utilize the customer&#146;s
    existing revenue cycle management and staff and layer our
    proprietary technology tools on top of the customer&#146;s
    existing patient accounting system. Each customer&#146;s
    situation is different, and unanticipated difficulties and
    delays may arise. If the implementation process is not executed
    successfully or is delayed, our relationship with the customer
    may be adversely affected and our results of operations could
    suffer. Implementation of our solution also requires us to
    integrate our own employees into the customer&#146;s operations.
    The customer&#146;s circumstances may require us to devote a
    larger number of our employees than anticipated, which could
    increase our costs and harm our financial results.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Our quarterly
    results of operations may fluctuate as a result of factors that
    may impact our incentive and base fees, some of which may be
    outside of our control.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We recognize base fee revenue on a straight-line basis over the
    life of the managed service contract. Base fees for contracts
    which are received in advance of services delivered are
    classified as deferred revenue until services have been
    provided. Our managed service contracts generally allow for
    adjustments to the base fee. Adjustments typically occur at 90,
    180 or 360&#160;days after the contract commences, but can also
    occur at subsequent dates as a result of factors including
    changes to the scope of operations and internal and external
    audits. In addition, our fees from hospitals affiliated with
    Ascension Health are subject to adjustment in the event
    quarterly cash collections at these hospitals deteriorate
    materially after we take over revenue cycle management
    operations. While these adjustments have never been triggered,
    if they were, our future fees from hospitals affiliated with
    Ascension Health would be reduced. Further, estimates of the
    incentive payments we have earned from providing services to
    customers in prior periods could change because the laws,
    regulations, instructions, payor contracts and rule
    interpretations governing how our customers receive payments
    from payors are complex and change frequently. All adjustments,
    the timing of which are often dependent on factors outside of
    our control and which can increase or decrease our revenue and
    operating margin, are recorded in the period the changes are
    known and collectibility is reasonably assured. Any such
    adjustments may cause our quarter-to-quarter results of
    operations to fluctuate.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">If we lose key
    personnel or if we are unable to attract, hire, integrate and
    retain key personnel and other necessary employees, our business
    would be harmed.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our future success depends in part on our ability to attract,
    hire, integrate and retain key personnel. Our future success
    also depends on the continued contributions of our executive
    officers and other key personnel, each of whom may be difficult
    to replace. In particular, Mary A. Tolan, our president and
    chief executive officer, is critical to the management of our
    business and operations and the development of our strategic
    direction. The loss of services of Ms.&#160;Tolan or any of our
    other executive officers or key personnel or the inability to
    continue to attract qualified personnel could have a material
    adverse effect on our business. The replacement of any of these
    key personnel would involve significant time and expense and may
    significantly delay or prevent the achievement of our business
    objectives. Competition for the caliber and number of employees
    we require is intense. We
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    may face difficulty identifying and hiring qualified personnel
    at compensation levels consistent with our existing compensation
    and salary structure. In addition, we invest significant time
    and expense in training each of our employees, which increases
    their value to competitors who may seek to recruit them. If we
    fail to retain our employees, we could incur significant
    expenses in hiring, integrating and training their replacements
    and the quality of our services and our ability to serve our
    customers could diminish, resulting in a material adverse effect
    on our business.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">If we fail to
    manage future growth effectively, our business would be
    harmed.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We have expanded our operations significantly since inception
    and anticipate expanding further. For example, our net services
    revenue increased from $16.2&#160;million in 2004 to
    $398.5&#160;million in 2008, and the number of our full-time
    employees increased from two at January&#160;1, 2004 to 1,305 as
    of June&#160;30, 2009. This growth has placed significant
    demands on our management, infrastructure and other resources.
    To manage future growth, we will need to hire, integrate and
    retain highly skilled and motivated employees. We will also need
    to continue to improve our financial and management controls,
    reporting systems and procedures. If we do not effectively
    manage our growth, we may not be able to execute on our business
    plan, respond to competitive pressures, take advantage of market
    opportunities, satisfy customer requirements or maintain
    high-quality service offerings.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Disruptions in
    service or damage to our data centers and shared services
    centers could adversely affect our business.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our data centers and shared services centers are essential to
    our business. Our operations depend on our ability to operate
    our shared service centers, and to maintain and protect our
    applications, which are located in data centers that are
    operated for us by third parties. We cannot control or assure
    the continued or uninterrupted availability of these third party
    data centers. In addition, our information technologies and
    systems, as well as our data centers and shared services
    centers, are vulnerable to damage or interruption from various
    causes, including (i)&#160;acts of God and other natural
    disasters, war and acts of terrorism and (ii)&#160;power losses,
    computer systems failures, Internet and telecommunications or
    data network failures, operator error, losses of and corruption
    of data and similar events. We conduct business continuity
    planning and maintain insurance against fires, floods, other
    natural disasters and general business interruptions to mitigate
    the adverse effects of a disruption, relocation or change in
    operating environment at one of our data centers or shared
    services centers, but the situations we plan for and the amount
    of insurance coverage we maintain may not be adequate in any
    particular case. In addition, the occurrence of any of these
    events could result in interruptions, delays or cessations in
    service to our customers, or in interruptions, delays or
    cessations in the direct connections we establish between our
    customers and third-party payors. Any of these events could
    impair or prohibit our ability to provide our services, reduce
    the attractiveness of our services to current or potential
    customers and adversely impact our financial condition and
    results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In addition, despite the implementation of security measures,
    our infrastructure, data centers, shared services centers or
    systems that we interface with, including the Internet and
    related systems, may be vulnerable to physical break-ins,
    hackers, improper employee or contractor access, computer
    viruses, programming errors, denial-of-service attacks or other
    attacks by third parties seeking to disrupt operations or
    misappropriate information or similar physical or electronic
    breaches of security. Any of these can cause system failure,
    including network, software or hardware failure, which can
    result in service disruptions. As a result, we may be required
    to expend significant capital and other resources to protect
    against security breaches and hackers or to alleviate problems
    caused by such breaches.
</DIV>

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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">If our
    security measures are breached or fail and unauthorized access
    is obtained to a customer&#146;s data, our service may be
    perceived as not being secure, the attractiveness of our
    services to current or potential customers may be reduced, and
    we may incur significant liabilities.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our services involve the storage and transmission of
    customers&#146; proprietary information and protected health,
    financial, payment and other personal information of patients.
    We rely on proprietary and commercially available systems,
    software, tools and monitoring, as well as other processes, to
    provide security for processing, transmission and storage of
    such information, and because of the sensitivity of this
    information, the effectiveness of such security efforts is very
    important. The systems currently used for transmission and
    approval of credit card transactions, and the technology
    utilized in credit cards themselves, all of which can put credit
    card data at risk, are determined and controlled by the payment
    card industry, not by us. If our security measures are breached
    or fail as a result of third-party action, employee error,
    malfeasance or otherwise, someone may be able to obtain
    unauthorized access to customer or patient data. Improper
    activities by third parties, advances in computer and software
    capabilities and encryption technology, new tools and
    discoveries and other events or developments may facilitate or
    result in a compromise or breach of our computer systems.
    Techniques used to obtain unauthorized access or to sabotage
    systems change frequently and generally are not recognized until
    launched against a target, and we may be unable to anticipate
    these techniques or to implement adequate preventive measures.
    Our security measures may not be effective in preventing these
    types of activities, and the security measures of our
    third-party data centers and service providers may not be
    adequate. If a breach of our security occurs, we could face
    damages for contract breach, penalties for violation of
    applicable laws or regulations, possible lawsuits by individuals
    affected by the breach and significant remediation costs and
    efforts to prevent future occurrences. In addition, whether
    there is an actual or a perceived breach of our security, the
    market perception of the effectiveness of our security measures
    could be harmed and we could lose current or potential customers.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">We may be
    liable to our customers or third parties if we make errors in
    providing our services, and our anticipated net services revenue
    may be lower if we provide poor service.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The services we offer are complex, and we make errors from time
    to time. Errors can result from the interface of our proprietary
    technology tools and a customer&#146;s existing patient
    accounting system, or we may make human errors in any aspect of
    our service offerings. The costs incurred in correcting any
    material errors may be substantial and could adversely affect
    our operating results. Our customers, or third parties such as
    our customers&#146; patients, may assert claims against us
    alleging that they suffered damages due to our errors, and such
    claims could subject us to significant legal defense costs and
    adverse publicity regardless of the merits or eventual outcome
    of such claims. In addition, if we provide poor service to a
    customer and the customer therefore realizes less improvement in
    revenue yield, the incentive fee payments to us from that
    customer will be lower than anticipated.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">We offer our
    services in many jurisdictions and, therefore, may be subject to
    state and local taxes that could harm our business or that we
    may have inadvertently failed to pay.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We may lose sales or incur significant costs should various tax
    jurisdictions be successful in imposing taxes on a broader range
    of services. Imposition of such taxes on our services could
    result in substantial unplanned costs, would effectively
    increase the cost of such services to our customers and may
    adversely affect our ability to retain existing customers or to
    gain new customers in the areas in which such taxes are imposed.
    For example, in 2008 Michigan began to impose a tax based on
    gross receipts in addition to tax based on net income. For the
    year ended December&#160;31, 2008, we recorded a tax provision
    of $2.3&#160;million, of which $1.2&#160;million was
    attributable to the Michigan gross receipts tax.
</DIV>

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    <BR>
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Our growing
    operations in India expose us to risks that could have an
    adverse effect on our costs of operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We employ a significant number of persons in India and expect to
    continue to add personnel in India. While there are cost
    advantages to operating in India, significant growth in the
    technology sector in India has increased competition to attract
    and retain skilled employees and has led to a commensurate
    increase in compensation costs. In the future, we may not be
    able to hire and retain such personnel at compensation levels
    consistent with our existing compensation and salary structure
    in India. In addition, our reliance on a workforce in India
    exposes us to disruptions in the business, political and
    economic environment in that region. Maintenance of a stable
    political environment is important to our operations, and
    terrorist attacks and acts of violence or war may directly
    affect our physical facilities and workforce or contribute to
    general instability. Our operations in India require us to
    comply with local laws and regulatory requirements, which are
    complex and of which we may not always be aware, and expose us
    to foreign currency exchange rate risk. Our Indian operations
    may also subject us to trade restrictions, reduced or inadequate
    protection for intellectual property rights, security breaches
    and other factors that may adversely affect our business.
    Negative developments in any of these areas could increase our
    costs of operations or otherwise harm our business.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Negative
    public perception in the United States regarding offshore
    outsourcing and proposed legislation may increase the cost of
    delivering our services.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Offshore outsourcing is a politically sensitive topic in the
    United States. For example, various organizations and public
    figures in the United States have expressed concern about a
    perceived association between offshore outsourcing providers and
    the loss of jobs in the United States. In addition, there has
    been recent publicity about the negative experience of certain
    companies that use offshore outsourcing, particularly in India.
    Current or prospective customers may elect to perform such
    services themselves or may be discouraged from transferring
    these services from onshore to offshore providers to avoid
    negative perceptions that may be associated with using an
    offshore provider. Any slowdown or reversal of existing industry
    trends towards offshore outsourcing would increase the cost of
    delivering our services if we had to relocate aspects of our
    services from India to the United States where operating costs
    are higher.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Legislation in the United States may be enacted that is intended
    to discourage or restrict offshore outsourcing. In the United
    States, federal and state legislation has been proposed, and
    enacted in several states, that could restrict or discourage
    U.S.&#160;companies from outsourcing their services to companies
    outside the United States. For example, legislation has been
    proposed that would require offshore providers to identify where
    they are located. In addition, legislation has been enacted in
    at least one state that requires that state contracts for
    services be performed within the United States, while several
    other states provide a preference to state contracts that are
    performed within the state. It is possible that legislation
    could be adopted that would restrict U.S.&#160;private sector
    companies that have federal or state government contracts, or
    that receive government funding or reimbursement, such as
    Medicare or Medicaid payments, from outsourcing their services
    to offshore service providers. Any changes to existing laws or
    the enactment of new legislation restricting offshore
    outsourcing in the United States may adversely affect our
    ability to do business, particularly if these changes are
    widespread, and could have a material adverse effect on our
    business, results of operations, financial condition and cash
    flows.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">We may engage
    in future acquisitions that could disrupt our business, cause
    dilution to our stockholders and harm our business, operating
    results or financial condition.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Although we currently have no business acquisitions pending or
    planned, we may pursue acquisition opportunities in the future.
    We have limited experience consummating acquisitions, and
    therefore our ability as an organization to make acquisitions is
    unproven. We may not be able to find suitable acquisition
    candidates, and we may not be able to complete acquisitions on
    favorable terms. If we do complete acquisitions, we may not
    ultimately strengthen our competitive position or achieve
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    our goals, or such acquisitions may be viewed negatively by
    customers, financial markets or investors. In addition, any
    acquisitions that we make could lead to difficulties in
    integrating personnel and operations from the acquired
    businesses and in retaining and motivating key personnel from
    these businesses. Acquisitions may disrupt our ongoing
    operations, divert management from day-to-day responsibilities,
    increase our expenses or adversely affect our business,
    operating results and financial condition. Future acquisitions
    may reduce our cash available for operations and other uses and
    could result in an increase in amortization expense related to
    identifiable assets acquired, potentially dilutive issuances of
    equity securities or the incurrence of debt, which could harm
    our business, operating results and financial condition.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Regulatory
    Risks</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">The healthcare
    industry is heavily regulated. Our failure to comply with
    regulatory requirements could create liability for us, result in
    adverse publicity and negatively affect our
    business.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The healthcare industry is heavily regulated and is subject to
    changing political, legislative, regulatory and other
    influences. Many healthcare laws are complex, and their
    application to specific services and relationships may not be
    clear. In particular, many existing healthcare laws and
    regulations, when enacted, did not anticipate the services that
    we provide. We believe we have structured our operations to
    comply with all material legal requirements that are applicable
    to us, but there can be no assurance that our operations will
    not be challenged or adversely affected by enforcement
    initiatives. Our failure to accurately anticipate the
    application of these laws and regulations to our business, or
    any other failure to comply with regulatory requirements, could
    create liability for us, result in adverse publicity and
    negatively affect our business. Federal and state legislatures
    and agencies periodically consider proposals to revise aspects
    of the healthcare industry or to revise or create additional
    statutory and regulatory requirements. Such proposals, if
    implemented, could impact our operations, the use of our
    services and our ability to market new services, or could create
    unexpected liabilities for us. We are unable to predict what
    changes to laws or regulations might be made in the future or
    how those changes could affect our business or our operating
    costs.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Developments
    in the healthcare industry, including national healthcare
    reform, could adversely affect our business.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The healthcare industry has changed significantly in recent
    years and we expect that significant changes will continue to
    occur. The timing and impact of developments in the healthcare
    industry are difficult to predict. We cannot be sure that the
    markets for our services will continue to exist at current
    levels or that we will have adequate technical, financial and
    marketing resources to react to changes in those markets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    National healthcare reform is currently a major policy issue at
    the federal level. The Obama administration has made healthcare
    reform a priority, and legislative proposals are currently being
    debated by Congress. Some of the underlying themes of current
    reform proposals&#160;&#151; quality and cost, uninsured
    coverage and healthcare information technology&#160;&#151; are
    broadly targeted to drive greater efficiency in the
    U.S.&#160;healthcare system by, among other things, rewarding
    quality and coordination of care and promoting broader adoption
    of electronic medical records.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Although it is impossible to predict what healthcare reform
    legislation, if any, will be enacted, proposals currently being
    debated could have adverse consequences for the hospitals we
    serve and for us. Healthcare reform could, for example, result
    in additional or costly legal and regulatory requirements that
    are applicable to us and our customers, encourage more companies
    to enter our market, provide advantages to our competitors and
    result in the development of solutions that compete with ours.
    In addition, healthcare reform could result in an increase to
    the number or scope
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    of federal or state charity care programs or community benefits
    programs, which may adversely affect our claim collection and
    recovery efforts.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">If a breach of
    our measures protecting personal data covered by the Health
    Insurance Portability and Accountability Act or Health
    Information Technology for Economic and Clinical Health Act
    occurs, we may incur significant liabilities.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Health Insurance Portability and Accountability Act of 1996,
    as amended, and the regulations that have been issued under it,
    which we refer to collectively as HIPAA, contain substantial
    restrictions and requirements with respect to the use and
    disclosure of individuals&#146; protected health information.
    Under HIPAA, covered entities must establish administrative,
    physical and technical safeguards to protect the
    confidentiality, integrity and availability of electronic
    protected health information maintained or transmitted by them
    or by others on their behalf. In February 2009 HIPAA was amended
    by the Health Information Technology for Economic and Clinical
    Health, or HITECH, Act to add provisions that will, beginning in
    2010, impose certain of the HIPAA privacy and security
    requirements directly upon business associates of covered
    entities. When new regulations take effect in late 2009, both
    covered entities and their business associates will be required
    to notify individuals and government authorities of data
    security breaches involving unsecured protected health
    information. We may be viewed as a business associate of a
    covered entity under HIPAA and the HITECH Act. We have
    implemented and maintain physical, technical and administrative
    safeguards intended to protect all personal data and have
    processes in place to assist us in complying with applicable
    laws and regulations regarding the protection of this data and
    properly responding to any security incidents. A knowing breach
    of the HITECH Act&#146;s requirements could expose us to
    criminal liability. A breach of our safeguards and processes
    that is not due to reasonable cause or involves willful neglect
    could expose us to civil penalties and the possibility of civil
    litigation.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">If we fail to
    comply with federal and state laws governing submission of false
    or fraudulent claims to government healthcare programs and
    financial relationships among healthcare providers, we may be
    subject to civil and criminal penalties or loss of eligibility
    to participate in government healthcare programs.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    A number of federal and state laws, including anti-kickback
    restrictions and laws prohibiting the submission of false or
    fraudulent claims, apply to healthcare providers, physicians and
    others that make, offer, seek or receive referrals or payments
    for products or services that may be paid for through any
    federal or state healthcare program and, in some instances, any
    private program. These laws are complex and their application to
    our specific services and relationships may not be clear and may
    be applied to our business in ways that we do not anticipate.
    Federal and state regulatory and law enforcement authorities
    have recently increased enforcement activities with respect to
    Medicare and Medicaid fraud and abuse regulations and other
    healthcare reimbursement laws and rules. From time to time,
    participants in the healthcare industry receive inquiries or
    subpoenas to produce documents in connection with government
    investigations. We could be required to expend significant time
    and resources to comply with these requests, and the attention
    of our management team could be diverted by these efforts.
    Furthermore, if we are found to be in violation of any federal
    or state fraud and abuse laws, we could be subject to civil and
    criminal penalties, and we could be excluded from participating
    in federal and state healthcare programs such as Medicare and
    Medicaid. The occurrence of any of these events could give our
    customers the right to terminate our managed service contracts
    with them and result in significant harm to our business and
    financial condition.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The federal anti-kickback law prohibits any person or entity
    from offering, paying, soliciting or receiving anything of
    value, directly or indirectly, for the referral of patients
    covered by Medicare, Medicaid and other federal healthcare
    programs or the leasing, purchasing, ordering or arranging for
    or recommending the lease, purchase or order of any item, good,
    facility or service covered by these programs. Many states have
    adopted similar prohibitions against kickbacks and other
    practices that are intended to induce referrals, and some of
    these state laws are applicable to all patients regardless
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    of whether the patient is covered under a governmental health
    program or private health plan. We evaluate our business
    relationships and activities to comply with the federal
    anti-kickback statute and similar laws, and we seek to structure
    our financial arrangements in a manner that is consistent with
    the requirements of applicable safe harbors to these laws. We
    cannot assure you, however, that our arrangements will be
    protected by such safe harbors or that such increased
    enforcement activities will not directly or indirectly have an
    adverse effect on our business financial condition or results of
    operations. Any determination by a federal or state agency that
    any of our activities or those of our vendors or customers
    violate any of these laws could subject us to civil or criminal
    penalties, could require us to change or terminate some portions
    of our operations or business, could disqualify us from
    providing services to healthcare providers doing business with
    government programs, could give our customers the right to
    terminate our managed service contracts with them and, thus,
    could have a material adverse effect on our business and results
    of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    There are also numerous federal and state laws that forbid
    submission of false information or the failure to disclose
    information in connection with the submission and payment of
    physician claims for reimbursement. In particular, the federal
    False Claims Act, or the FCA, prohibits a person from knowingly
    presenting or causing to be presented a false or fraudulent
    claim for payment or approval by an officer, employee or agent
    of the United States. In addition, the FCA prohibits a person
    from knowingly making, using, or causing to be made or used a
    false record or statement material to such a claim. Violations
    of the FCA may result in treble damages, significant monetary
    penalties, and other collateral consequences including,
    potentially, exclusion from participation in federally funded
    health care programs. The scope and implications of the recent
    amendments pursuant to the Fraud Enforcement and Recovery Act of
    2009, or FERA, have yet to be fully determined or adjudicated
    and as a result it is difficult to predict how future
    enforcement initiatives may impact our business.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    These laws and regulations may change rapidly, and it is
    frequently unclear how they apply to our business. Errors
    created by our proprietary tools or services that relate to
    entry, formatting, preparation or transmission of claim or cost
    report information may be determined or alleged to be in
    violation of these laws and regulations. Any failure of our
    proprietary tools or services to comply with these laws and
    regulations could result in substantial civil or criminal
    liability and could, among other things, adversely affect demand
    for our services, invalidate all or portions of some of our
    managed service contracts with our customers, require us to
    change or terminate some portions of our business, require us to
    refund portions of our base fee revenues and incentive payment
    revenues, cause us to be disqualified from serving customers
    doing business with government payers, and give our customers
    the right to terminate our managed service contracts with them,
    any one of which could have an adverse effect on our business.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Our failure to
    comply with debt collection and consumer credit reporting
    regulations could subject us to fines and other liabilities,
    which could harm our reputation and business.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The U.S.&#160;Fair Debt Collection Practices Act, or FDCPA,
    regulates persons who regularly collect or attempt to collect,
    directly or indirectly, consumer debts owed or asserted to be
    owed to another person. Certain of our accounts receivable
    activities may be subject to the FDCPA. Many states impose
    additional requirements on debt collection communications, and
    some of those requirements may be more stringent than the
    comparable federal requirements. Moreover, regulations governing
    debt collection are subject to changing interpretations that may
    be inconsistent among different jurisdictions. We are also
    subject to the Fair Credit Reporting Act, or FCRA, which
    regulates consumer credit reporting and which may impose
    liability on us to the extent that the adverse credit
    information reported on a consumer to a credit bureau is false
    or inaccurate. We could incur costs or could be subject to fines
    or other penalties under the FCRA if the Federal Trade
    Commission determines that we have mishandled protected
    information. We or our customers could be required to report
    such breaches to affected consumers or regulatory authorities,
    leading to disclosures that could damage our reputation or harm
    our business, financial position and operating results.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    21
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Potential
    additional regulation of the disclosure of health information
    outside the United States may increase our costs.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Federal or state governmental authorities may impose additional
    data security standards or additional privacy or other
    restrictions on the collection, use, transmission and other
    disclosures of health information. Legislation has been proposed
    at various times at both the federal and the state levels that
    would limit, forbid or regulate the use or transmission of
    medical information pertaining to U.S.&#160;patients outside of
    the United States. Such legislation, if adopted, may render our
    operations in India impracticable or substantially more
    expensive. Moving such operations to the United States may
    involve substantial delay in implementation and increased costs.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Risks Related to
    Intellectual Property</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">We may be
    unable to adequately protect our intellectual
    property.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our success depends, in part, upon our ability to establish,
    protect and enforce our intellectual property and other
    proprietary rights. If we fail to establish or protect our
    intellectual property rights, we may lose an important advantage
    in the market in which we compete. We rely upon a combination of
    trademark, copyright and trade secret law and contractual terms
    and conditions to protect our intellectual property rights, all
    of which provide only limited protection. We cannot assure you
    that our intellectual property rights are sufficient to protect
    our competitive advantages. Although we have filed four patent
    applications, we cannot assure you that any patents will issue
    from these applications in a manner that gives us the protection
    that we seek, or that any future patents issued to us will not
    be challenged, invalidated or circumvented. Legal standards
    relating to the validity, enforceability and scope of protection
    of patents are uncertain. Any patents that may issue in the
    future from pending or future patent applications may not
    provide sufficiently broad protection or they may not prove to
    be enforceable in actions against alleged infringers. Also, we
    cannot assure you that any trademark registrations will be
    issued for pending or future applications or that any of our
    trademarks will be enforceable or provide adequate protection of
    our proprietary rights.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We also rely in some circumstances on trade secrets to protect
    our technology. Trade secrets may lose their value if not
    properly protected. We endeavor to enter into non-disclosure
    agreements with our employees, customers, contractors and
    business partners to limit access to and disclosure of our
    proprietary information. The steps we have taken, however, may
    not prevent unauthorized use of our technology, and adequate
    remedies may not be available in the event of unauthorized use
    or disclosure of our trade secrets and proprietary technology.
    Moreover, others may reverse engineer or independently develop
    technologies that are competitive to ours or infringe our
    intellectual property.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accordingly, despite our efforts, we may be unable to prevent
    third parties from infringing or misappropriating our
    intellectual property and using our technology for their
    competitive advantage. Any such infringement or misappropriation
    could have a material adverse effect on our business, results of
    operations and financial condition. Monitoring infringement of
    our intellectual property rights can be difficult and costly,
    and enforcement of our intellectual property rights may require
    us to bring legal actions against infringers. Infringement
    actions are inherently uncertain and therefore may not be
    successful, even when our rights have been infringed, and even
    if successful may require a substantial amount of resources and
    divert our management&#146;s attention.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Claims by
    others that we infringe their intellectual property could force
    us to incur significant costs or revise the way we conduct our
    business.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our competitors protect their intellectual property rights by
    means such as patents, trade secrets, copyrights and trademarks.
    We have not conducted an independent review of patents issued to
    third parties. Additionally, because patent applications in the
    United States and many other jurisdictions are kept confidential
    for 18&#160;months before they are published, we may be unaware
    of pending patent applications that relate to our proprietary
    technology. Although we have not been involved in any litigation
    related to intellectual property rights of others, from time to
    time we receive
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    22
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    letters from other parties alleging, or inquiring about,
    possible breaches of their intellectual property rights. Any
    party asserting that we infringe its proprietary rights would
    force us to defend ourselves, and possibly our customers,
    against the alleged infringement. These claims and any resulting
    lawsuit, if successful, could subject us to significant
    liability for damages and invalidation of our proprietary rights
    or interruption or cessation of our operations. The software and
    technology industries are characterized by the existence of a
    large number of patents, copyrights, trademarks and trade
    secrets and by frequent litigation based on allegations of
    infringement or other violations of intellectual property
    rights. Moreover, the risk of such a lawsuit will likely
    increase as our size and scope of our services and technology
    platforms increase, as our geographic presence and market share
    expand and as the number of competitors in our market increases.
    Any such claims or litigation could:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    be time-consuming and expensive to defend, whether meritorious
    or not;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    require us to stop providing the services that use the
    technology that infringes the other party&#146;s intellectual
    property;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    divert the attention of our technical and managerial resources;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    require us to enter into royalty or licensing agreements with
    third parties, which may not be available on terms that we deem
    acceptable, if at all;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    prevent us from operating all or a portion of our business or
    force us to redesign our services and technology platforms,
    which could be difficult and expensive and may make the
    performance or value of our service offerings less attractive;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    subject us to significant liability for damages or result in
    significant settlement payments;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    require us to indemnify our customers as we are required by
    contract to indemnify some of our customers for certain claims
    based upon the infringement or alleged infringement of any third
    party&#146;s intellectual property rights resulting from our
    customers&#146; use of our intellectual property.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Intellectual property litigation can be costly. Even if we
    prevail, the cost of such litigation could deplete our financial
    resources. Litigation is also time-consuming and could divert
    management&#146;s attention and resources away from our
    business. Furthermore, during the course of litigation,
    confidential information may be disclosed in the form of
    documents or testimony in connection with discovery requests,
    depositions or trial testimony. Disclosure of our confidential
    information and our involvement in intellectual property
    litigation could materially adversely affect our business. Some
    of our competitors may be able to sustain the costs of complex
    intellectual property litigation more effectively than we can
    because they have substantially greater resources. In addition,
    any uncertainties resulting from the initiation and continuation
    of any litigation could significantly limit our ability to
    continue our operations and could harm our relationships with
    current and prospective customers. Any of the foregoing could
    disrupt our business and have a material adverse effect on our
    operating results and financial condition.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Risks Related to
    this Offering and Ownership of Shares of Our Common
    Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">The trading
    price of our common stock is likely to be volatile, and you may
    not be able to sell your shares at or above the initial public
    offering price.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our common stock has no prior trading history, and an active
    public market for these shares may not develop or be sustained
    after this offering. The initial public offering price for our
    common stock will be determined through negotiations with the
    representatives of the underwriters. This price will not
    necessarily reflect the price at which investors in the market
    will be willing to buy and sell our shares following this
    offering. In addition, the trading price of our common stock is
    likely to be highly volatile and could be subject to wide
    fluctuations in response to various factors. In addition to the
    risks
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    23
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    described in this section, factors that may cause the market
    price of our common stock to fluctuate include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    fluctuations in our quarterly financial results or the quarterly
    financial results of companies perceived to be similar to us;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in estimates of our financial results or recommendations
    by securities analysts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    investors&#146; general perception of us;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in general economic, industry and market conditions.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In addition, if the stock market in general experiences a loss
    of investor confidence, the trading price of our common stock
    could decline for reasons unrelated to our business, financial
    condition or results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Some companies that have had volatile market prices for their
    securities have had securities class actions filed against them.
    If a suit were filed against us, regardless of its merits or
    outcome, it would likely result in substantial costs and divert
    management&#146;s attention and resources. This could have a
    material adverse effect on our business, operating results and
    financial condition.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Our securities
    have no prior market and our stock price may decline after the
    offering.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to this offering, there has been no public market for
    shares of our common stock. Although we intend to apply to have
    our common stock listed on the New York Stock Exchange, an
    active public trading market for our common stock may not
    develop or, if it develops, may not be maintained after this
    offering. For example, the New York Stock Exchange imposes
    certain securities trading requirements, including minimum
    trading price, minimum number of stockholders and minimum market
    capitalization. Our company and the representatives of the
    underwriters will negotiate to determine the initial public
    offering price. The initial public offering price may be higher
    than the trading price of our common stock following this
    offering. As a result, you could lose all or part of your
    investment.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Future sales
    of shares by existing stockholders could cause our stock price
    to decline.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    If our existing stockholders sell, or indicate an intention to
    sell, substantial amounts of our common stock in the public
    market after the contractual
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements described below expire and other restrictions on
    resale lapse, the trading price of our common stock could
    decline below the initial public offering price. Based on shares
    outstanding as of June&#160;30, 2009, upon the closing of this
    offering, we will have
    outstanding&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock. Of these
    shares,&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock will be eligible for sale in the public market
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock will be subject to a
    <FONT style="white-space: nowrap">180-day</FONT>
    contractual
    <FONT style="white-space: nowrap">lock-up</FONT> with
    the underwriters. Goldman, Sachs&#160;&#038; Co. and Credit
    Suisse Securities (USA) LLC, acting as representatives of the
    underwriters, may permit our officers, directors, employees and
    current stockholders who are subject to the contractual
    <FONT style="white-space: nowrap">lock-up</FONT> to
    sell shares prior to the expiration of the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements. Upon expiration of the contractual
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements with the underwriters, and based on shares
    outstanding as of June&#160;30, 2009, an
    additional&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    will be eligible for sale in the public market.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Some of our existing stockholders have demand and incidental
    registration rights to require us to register with the SEC up
    to&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock. If we register these shares of common
    stock, the stockholders would be able to sell those shares
    freely in the public market.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    See &#147;Shares Eligible for Future Sale&#148; for further
    details regarding the number of shares eligible for sale in the
    public market after this offering.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    24
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Insiders will
    continue to have substantial control over us after this offering
    and will be able to determine substantially all matters
    requiring stockholder approval.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Upon the closing of this offering, our directors and executive
    officers and their affiliates will beneficially own, in the
    aggregate, approximately&#160;&#160;&#160;&#160;&#160;% of our
    outstanding common stock, assuming no exercise of the
    underwriters&#146; option to purchase additional shares. As a
    result, these stockholders will be able to determine
    substantially all matters requiring stockholder approval,
    including the election of directors and approval of significant
    corporate transactions, such as a merger or other sale of our
    company or its assets. This concentration of ownership could
    limit your ability to influence corporate matters and may have
    the effect of delaying or preventing a third-party from
    acquiring control over us. For information regarding the
    ownership of our outstanding stock by our executive officers and
    directors and their affiliates, see &#147;Principal and Selling
    Stockholders&#148;.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">We will incur
    significant increased costs as a result of operating as a public
    company, and our management will be required to devote
    substantial time to public company compliance
    matters.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We have never operated as a public company. As a public company,
    we will incur significant legal, accounting and other expenses
    that we did not incur as a private company. In addition, the
    Sarbanes-Oxley Act of 2002, as well as rules subsequently
    implemented by the SEC and the New York Stock Exchange, have
    imposed various new requirements on public companies, including
    requiring changes in corporate governance practices. Our
    management and other personnel will need to devote a substantial
    amount of time to compliance with our public company
    obligations. Moreover, these rules and regulations will increase
    our legal and financial compliance costs and will make some
    activities more time-consuming and costly. For example, we
    expect these rules and regulations to make it more difficult and
    more expensive for us to obtain director and officer liability
    insurance.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Sarbanes-Oxley Act requires, among other things, that we
    maintain effective internal control over financial reporting and
    disclosure controls and procedures. In particular, commencing
    with our fiscal year ending December&#160;31, 2010, we must
    perform system and process evaluation and testing of our
    internal control over financial reporting to allow management
    and our independent registered public accounting firm to report
    on the effectiveness of our internal control over financial
    reporting, as required by Section&#160;404 of the Sarbanes-Oxley
    Act. Our testing, or the subsequent testing by our independent
    registered public accounting firm, may reveal deficiencies in
    our internal control over financial reporting that are deemed to
    be material weaknesses. Our compliance with Section&#160;404
    will require that we incur substantial accounting expense and
    expend significant management time on compliance-related issues.
    Preparing for compliance with Section&#160;404 will require us
    to strengthen our internal controls, improve our processes and
    systems for financial reporting and internal controls, and hire
    additional accounting and financial staff with appropriate
    public company experience and technical accounting knowledge.
    Moreover, if we are not able to comply with the requirements of
    Section&#160;404 in a timely manner, or if we or our independent
    registered public accounting firm identifies deficiencies in our
    internal control over financial reporting that are deemed to be
    material weaknesses, the market price of our stock could
    decline, and we could be subject to sanctions or investigations
    by the New York Stock Exchange, the SEC or other regulatory
    authorities, which would require additional financial and
    management resources.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">If securities
    or industry analysts do not publish research or publish
    inaccurate or unfavorable research about our business, our stock
    price and trading volume could decline.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The trading market for our common stock will depend in part on
    the research and reports that securities or industry analysts
    publish about us or our business. We do not currently have and
    may never obtain widespread research coverage by securities and
    industry analysts. In the event we obtain securities or industry
    analyst coverage, if one or more of the analysts who covers us
    downgrades our stock or publishes inaccurate or unfavorable
    research about our business, our stock price would likely
    decline. If one or more of these analysts ceases coverage of our
    company or fails to publish reports
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    25
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    on us regularly, demand for our stock could decrease, which
    could cause our stock price and trading volume to decline.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">You will
    experience substantial dilution as a result of this offering and
    future equity issuances.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The initial public offering price per share is substantially
    higher than the pro forma net tangible book value per share of
    our common stock outstanding prior to this offering. As a
    result, investors purchasing common stock in this offering will
    experience immediate substantial dilution of
    $&#160;&#160;&#160;&#160;&#160; per share. In addition, we have
    issued options to acquire common stock at prices significantly
    below the initial public offering price. To the extent
    outstanding options are ultimately exercised, there will be
    further dilution to investors in this offering. This dilution is
    due in large part to the fact that our earlier investors paid
    substantially less than the initial public offering price when
    they purchased their shares of common stock. In addition, if the
    underwriters exercise their option to purchase additional
    shares, if outstanding warrants to purchase our common stock are
    exercised, or if we issue additional equity securities, you will
    experience additional dilution.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Anti-takeover
    provisions in our charter documents and Delaware law could
    discourage, delay or prevent a change in control of our company
    and may affect the trading price of our common
    stock.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We are a Delaware corporation and the anti-takeover provisions
    of the Delaware General Corporation Law may discourage, delay or
    prevent a change in control by prohibiting us from engaging in a
    business combination with an interested stockholder for a period
    of three years after the person becomes an interested
    stockholder, even if a change in control would be beneficial to
    our existing stockholders. In addition, our restated certificate
    of incorporation and amended and restated bylaws may discourage,
    delay or prevent a change in our management or control over us
    that stockholders may consider favorable. Our restated
    certificate of incorporation and amended and restated bylaws,
    which will be in effect prior to the closing of this offering:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    authorize the issuance of &#147;blank check&#148; preferred
    stock that could be issued by our board of directors to thwart a
    takeover attempt;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    establish a classified board of directors, as a result of which
    the successors to the directors whose terms have expired will be
    elected to serve from the time of election and qualification
    until the third annual meeting following their election;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    require that directors only be removed from office for cause and
    only upon a supermajority stockholder vote;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide that vacancies on the board of directors, including
    newly created directorships, may be filled only by a majority
    vote of directors then in office;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    limit who may call special meetings of stockholders;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    prohibit stockholder action by written consent, requiring all
    actions to be taken at a meeting of the stockholders;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    require supermajority stockholder voting to effect certain
    amendments to our restated certificate of incorporation and
    amended and restated bylaws.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    For additional information regarding these and other
    anti-takeover provisions, see &#147;Description of Capital
    Stock&#160;&#151; Anti-Takeover Effects of Our Charter and
    Bylaws and Delaware Law&#148;.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    26
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Our management
    will have broad discretion over the use of the proceeds we
    receive in this offering and might not apply the proceeds in
    ways that increase the value of your investment.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our management will have broad discretion to use the net
    proceeds from this offering, and you will be relying on the
    judgment of our management regarding the application of these
    proceeds. Our management might not apply the net proceeds of
    this offering in ways that increase the value of your
    investment. We expect to use the net proceeds from this offering
    for general corporate purposes, which may include financing our
    growth, developing new services and funding capital
    expenditures, acquisitions and investments. You will not have
    the opportunity to influence our decisions on how to use the net
    proceeds from this offering.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">We do not
    anticipate paying any cash dividends on our capital stock in the
    foreseeable future following the closing of this
    offering.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Although we paid a cash dividend on our capital stock in July
    2008 and declared another cash dividend on our capital stock in
    August 2009, we do not expect to pay cash dividends on our
    common stock in the foreseeable future following the closing of
    this offering. Any future dividend payments will be within the
    absolute discretion of our board of directors and will depend
    on, among other things, our financial condition, results of
    operations, capital requirements, capital expenditure
    requirements, contractual restrictions, provisions of applicable
    law and other factors that our board of directors may deem
    relevant. We may not generate sufficient cash from operations in
    the future to pay dividends on our common stock. See
    &#147;Dividend Policy&#148;.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    27
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='104'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">SPECIAL
    NOTE&#160;REGARDING FORWARD-LOOKING STATEMENTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    This prospectus contains forward-looking statements that involve
    substantial risks and uncertainties. All statements, other than
    statements of historical facts, included in this prospectus
    regarding our strategy, future operations, future financial
    position, future revenue, projected costs, prospects, plans,
    objectives of management and expected market growth are
    forward-looking statements. The words &#147;anticipate&#148;,
    &#147;believe&#148;, &#147;estimate&#148;, &#147;expect&#148;,
    &#147;intend&#148;, &#147;may&#148;, &#147;plan&#148;,
    &#147;predict&#148;, &#147;project&#148;, &#147;will&#148;,
    &#147;would&#148; and similar expressions are intended to
    identify forward-looking statements, although not all
    forward-looking statements contain these identifying words.
    These forward-looking statements include, among other things,
    statements about:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to attract and retain customers;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our financial performance;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the advantages of our solution as compared to those of others;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our new quality/cost service initiative;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to establish and maintain intellectual property
    rights;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to retain and hire necessary employees and
    appropriately staff our operations;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our estimates regarding capital requirements and needs for
    additional financing.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We may not actually achieve the plans, intentions or
    expectations disclosed in our forward-looking statements, and
    you should not place undue reliance on our forward-looking
    statements. Actual results or events could differ materially
    from the plans, intentions and expectations disclosed in the
    forward-looking statements we make. We have included important
    factors in the cautionary statements included in this
    prospectus, particularly in the &#147;Risk Factors&#148;
    section, that could cause actual results or events to differ
    materially from the forward-looking statements that we make. Our
    forward-looking statements do not reflect the potential impact
    of any future acquisitions, mergers, dispositions, joint
    ventures or investments we may make.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    You should read this prospectus and the documents that we have
    filed as exhibits to the registration statement, of which this
    prospectus is a part, completely and with the understanding that
    our actual future results may be materially different from what
    we expect. We do not assume any obligation to update any
    forward-looking statements, whether as a result of new
    information, future events or otherwise, except as required by
    law.
</DIV>
<A name='105'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">INDUSTRY AND
    MARKET DATA</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We obtained the industry and market data in this prospectus from
    our own research as well as from industry and general
    publications, surveys and studies conducted by third parties.
    Industry and general publications, studies and surveys generally
    state that they have been obtained from sources believed to be
    reliable, although they do not guarantee the accuracy or
    completeness of such information. While we believe that these
    publications, studies and surveys are reliable, we have not
    independently verified the data contained in them. In addition,
    while we believe that the results and estimates from our
    internal research are reliable, such results and estimates have
    not been verified by any independent source.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    28
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='106'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">USE OF
    PROCEEDS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We estimate that we will receive net proceeds from this offering
    of approximately $&#160;&#160;&#160;&#160;&#160;&#160;million,
    or $&#160;&#160;&#160;&#160;&#160;&#160;million if the
    underwriters exercise their option to purchase additional shares
    in full, based on an assumed initial public offering price of
    $&#160;&#160;&#160;&#160;&#160; per share, the midpoint of the
    estimated price range shown on the cover of this prospectus, and
    after deducting the estimated underwriting discount and offering
    expenses payable by us. We will not receive any proceeds from
    the sale of shares of common stock by the selling stockholders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    A $1.00 increase (decrease) in the assumed initial public
    offering price of $&#160;&#160;&#160;&#160;&#160; , the midpoint
    of the estimated price range shown on the cover of this
    prospectus, would increase (decrease) the net proceeds to us
    from this offering by
    $&#160;&#160;&#160;&#160;&#160;&#160;million, assuming the
    number of shares offered by us, as set forth on the cover of
    this prospectus, remains the same and after deducting the
    estimated underwriting discount and offering expenses payable by
    us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We intend to use approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million of our net proceeds
    of this offering to pay the preferred stock liquidation
    preferences that will be paid in cash to the holders of our
    outstanding preferred stock concurrently with the conversion of
    such shares into shares of our common stock upon the closing of
    this offering. We intend to use the remainder of our net
    proceeds of this offering for general corporate purposes, which
    may include financing our growth, developing new services and
    funding capital expenditures, acquisitions and investments. In
    addition, the other principal purposes for this offering are to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    increase our visibility in the markets we serve;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    strengthen our balance sheet and increase the likelihood that we
    remain debt-free;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    create a public market for our common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    facilitate our future access to the public capital markets;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide liquidity for our existing stockholders;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    improve the effectiveness of our equity compensation plans in
    attracting and retaining key employees;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enhance our ability to acquire complementary businesses or
    technologies.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Except for the preferred stock liquidation preference payments
    described above, we have not yet determined with any certainty
    the manner in which we will allocate our net proceeds. Our
    management will retain broad discretion in the allocation and
    use of our net proceeds of this offering. The amounts and timing
    of these expenditures will vary depending on a number of
    factors, including the amount of cash generated by our
    operations, competitive and technological developments, and the
    rate of growth, if any, of our business. For example, if we were
    to expand our operations more rapidly than anticipated by our
    current plans, a greater portion of the proceeds would likely be
    used for the development or enhancement of our proprietary
    technologies. Alternatively, if we were to engage in an
    acquisition that required a significant cash outlay, some or all
    of the proceeds might be used for that purpose.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Although we may use a portion of the proceeds for the
    acquisition of, or investment in, companies, technologies or
    assets that complement our business, we have no present
    understandings, commitments or agreements to enter into any
    acquisitions or make any material investments. We cannot assure
    you that we will make any acquisitions or investments in the
    future.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Pending specific utilization of the net proceeds as described
    above, we intend to invest the net proceeds of the offering in
    short-term investment grade and U.S.&#160;government securities.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    29
</DIV><!-- END PAGE WIDTH -->
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='107'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">DIVIDEND
    POLICY</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We paid a cash dividend in the aggregate amount of
    $15.0&#160;million, or $0.7203 per common-equivalent share, to
    holders of record as of July&#160;11, 2008 of our common stock
    and preferred stock. In August 2009, we declared an additional
    cash dividend in the aggregate amount of $15.0&#160;million, or
    $0.72 per common-equivalent share, to holders of record as of
    September&#160;1, 2009 of our common stock and preferred stock.
    Approximately $13&#160;million of this dividend is being paid in
    September 2009 and the balance in October 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We currently intend to retain earnings, if any, to finance the
    growth and development of our business, and we do not expect to
    pay any cash dividends on our common stock in the foreseeable
    future following the closing of this offering. Payment of future
    dividends, if any, will be at the discretion of our board of
    directors and will depend on our financial condition, results of
    operations, capital requirements, restrictions contained in
    current or future financing instruments, provisions of
    applicable law, and other factors the board deems relevant.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    30
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='108'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">CAPITALIZATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth our capitalization as of
    June&#160;30, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on an actual basis;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on a pro forma basis to reflect
    (1)&#160;the&#160;&#160;&#160;&#160;&#160;-for-one split of our
    common stock to be effected prior to the closing of this
    offering, (2)&#160;the automatic conversion of all outstanding
    shares of non-voting common stock into shares of common stock
    upon the closing of this offering, (3)&#160;the automatic
    conversion of all outstanding shares of convertible preferred
    stock into shares of common stock upon the closing of this
    offering and (4)&#160;the assumed issuance
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock upon exercise of warrants that will be cancelled
    if not exercised prior to this offering.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on a pro forma as adjusted basis to reflect (1)&#160;the items
    described in the preceding bullet, (2)&#160;the filing of our
    restated certificate of incorporation prior to the closing of
    this offering, (3)&#160;our issuance and sale
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock in this offering at an assumed initial public
    offering price of $&#160;&#160;&#160;&#160;&#160; per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus, after deducting the estimated underwriting discount
    and offering expenses payable by us and the application of the
    net proceeds therefrom as described in &#147;Use of
    Proceeds&#148;, and (4)&#160;our issuance
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock to FT Partners contemporaneously with the
    closing of this offering, based on an assumed initial public
    offering price of $&#160;&#160;&#160;&#160;&#160; per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    You should read this table together with our financial
    statements and the related notes appearing at the end of this
    prospectus and the &#147;Use of Proceeds&#148; and
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations&#148; sections of this
    prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="62%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Pro forma<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Actual</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Pro forma</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">as adjusted</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
    <B>(Unaudited)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
    <B>(In thousands, except share and per share amounts)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stockholders&#146; equity:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Convertible preferred stock, $0.01&#160;par value;
    1,350,000&#160;shares authorized and issuable in series,
    1,299,541&#160;shares issued and outstanding, actual; no shares
    authorized, issued or outstanding, pro forma and pro forma as
    adjusted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Preferred stock, $0.01&#160;par value; no shares authorized,
    issued or outstanding, actual; 5,000,000&#160;shares authorized
    and no shares issued or outstanding, pro forma and pro forma as
    adjusted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Common stock, $0.01&#160;par value:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Common stock, 17,500,000&#160;shares authorized,
    8,178,119&#160;shares issued and outstanding, actual;
    17,500,000&#160;shares
    authorized,&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    issued and outstanding, pro
    forma;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    authorized,&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    issued and outstanding, pro forma as adjusted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    31
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
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    <TD width="62%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
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    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
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    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
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    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
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    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
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<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Pro forma<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Actual</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Pro forma</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">as adjusted</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
    <B>(Unaudited)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
    <B>(In thousands, except share and per share amounts)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Non-voting common stock, 8,000,000&#160;shares authorized,
    1,321,857&#160;shares issued and outstanding, actual; no shares
    authorized, issued or outstanding, pro forma and pro forma as
    adjusted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Additional paid-in capital
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    45,773
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Non-executive employee loans for stock option exercises
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (230
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accumulated deficit
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (24,887
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cumulative translation adjustment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (227
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    20,537
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total capitalization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    58,326
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    A $1.00 increase (decrease) in the assumed initial public
    offering price of $&#160;&#160;&#160;&#160;&#160; , the midpoint
    of the estimated price range shown on the cover of this
    prospectus, would increase (decrease) each of additional paid-in
    capital and total stockholders&#146; equity in the pro forma as
    adjusted column by $&#160;&#160;&#160;&#160;&#160;&#160;million,
    assuming the number of shares offered by us, as set forth on the
    cover of this prospectus, remains the same and after deducting
    the estimated underwriting discount and offering expenses
    payable by us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The table above is based on the number of shares of common stock
    outstanding as of June&#160;30, 2009, and excludes:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    833,334&#160;shares of common stock issuable upon the exercise
    of warrants outstanding and exercisable as of June&#160;30, 2009
    at a weighted-average exercise price of $1.12 per share, which
    will remain outstanding after this offering if not exercised
    prior to this offering;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    2,440,885&#160;shares of common stock issuable upon the exercise
    of stock options outstanding and exercisable as of June&#160;30,
    2009 at a weighted-average exercise price of $21.59 per share,
    of which 1,054,930&#160;shares with a weighted-average exercise
    price of $8.52 per share would be vested if purchased upon
    exercise of these options as of June&#160;30, 2009;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    173,828&#160;shares of common stock available for future
    issuance under our equity compensation plans as of June&#160;30,
    2009;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an
    additional&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock that will be made available for future
    issuance under our equity compensation plans upon the closing of
    this offering.
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    32
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='109'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">DILUTION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    If you invest in our common stock, your interest will be diluted
    immediately to the extent of the difference between the initial
    public offering price per share you will pay in this offering
    and the pro forma as adjusted net tangible book value per share
    of our common stock after this offering. Our pro forma
    historical net tangible book value as of June&#160;30, 2009 was
    $&#160;&#160;&#160;&#160;&#160;&#160;million, or
    $&#160;&#160;&#160;&#160;&#160; per share of common stock. Our
    pro forma net tangible book value per share set forth below
    represents our total tangible assets less total liabilities and
    convertible preferred stock, divided by the number of shares of
    our common stock outstanding on June&#160;30, 2009, after giving
    effect to (1)&#160;the&#160;&#160;&#160;&#160;&#160;-for-one
    split of our common stock to be effected prior to the closing of
    this offering, (2)&#160;the automatic conversion of all
    outstanding shares of non-voting common stock into shares of
    common stock upon the closing of this offering, (3)&#160;the
    automatic conversion of all outstanding shares of convertible
    preferred stock into shares of common stock immediately prior to
    the closing of this offering and (4)&#160;the assumed issuance
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock upon exercise of warrants that will be cancelled
    if not exercised prior to this offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    After giving effect to our issuance and sale
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock in this offering at an assumed initial public
    offering price of $&#160;&#160;&#160;&#160;&#160; per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus, after deducting the estimated underwriting discount
    and offering expenses payable by us, the pro forma as adjusted
    net tangible book value as of June&#160;30, 2009 would have been
    $&#160;&#160;&#160;&#160;&#160;&#160;million, or
    $&#160;&#160;&#160;&#160;&#160; per share. This represents an
    immediate increase in net tangible book value to existing
    stockholders of $&#160;&#160;&#160;&#160;&#160; per share.
    Accordingly, new investors who purchase shares of common stock
    in this offering will suffer an immediate dilution of their
    investment of $&#160;&#160;&#160;&#160;&#160; per share. The
    following table illustrates this per share dilution to the new
    investors purchasing shares of common stock in this offering
    without giving effect to the option to purchase additional
    shares granted to the underwriters:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="82%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="6%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="7%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Assumed initial public offering price per share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Pro forma net tangible book value per share as of June&#160;30,
    2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Increase per share attributable to sale of shares of common
    stock in this offering
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Pro forma as adjusted net tangible book value per share after
    the offering
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Dilution per share to new investors
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    A $1.00 increase (decrease) in the assumed initial public
    offering price of $&#160;&#160;&#160;&#160;&#160; per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus, would increase (decrease) the net tangible book
    value by $&#160;&#160;&#160;&#160;&#160;&#160;million, the net
    tangible book value per share after this offering by
    $&#160;&#160;&#160;&#160;&#160; per share and the dilution in
    net tangible book value per share to investors in this offering
    by $&#160;&#160;&#160;&#160;&#160; per share, assuming that the
    number of shares offered by us, as set forth on the cover of
    this prospectus, remains the same and after deducting the
    estimated underwriting discount and offering expenses payable by
    us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    If the underwriters exercise their option to purchase additional
    shares in full, the pro forma as adjusted net tangible book
    value will increase to $&#160;&#160;&#160;&#160;&#160; per
    share, representing an immediate increase to existing
    stockholders of $&#160;&#160;&#160;&#160;&#160; per share and an
    immediate dilution of $&#160;&#160;&#160;&#160;&#160; per share
    to new investors. If any shares are issued upon exercise of
    outstanding options or warrants, you will experience further
    dilution.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table summarizes, on a pro forma basis as of
    June&#160;30, 2009, the differences between the number of shares
    of common stock purchased from us, the total consideration paid
    to us, and the average price per share paid by existing
    stockholders and by new investors purchasing shares of common
    stock in this offering. The calculation below is based on an
    assumed initial public offering price of
    $&#160;&#160;&#160;&#160;&#160; per share, the midpoint of the
    estimated price range shown on the cover of this
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    33
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    prospectus, before the deduction of the estimated underwriting
    discount and offering expenses payable by us:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="49%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Shares Purchased</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total Consideration</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average Price<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Number</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">%</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Amount</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">%</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Per Share</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Existing stockholders
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    New investors
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    100
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The foregoing tables and calculations are based on the number of
    shares of our common stock outstanding as of June&#160;30, 2009
    after giving effect to
    (1)&#160;the&#160;&#160;&#160;&#160;&#160;-for-one split of our
    common stock to be effected prior to the closing of this
    offering, (2)&#160;the automatic conversion of all outstanding
    shares of non-voting common stock into shares of common stock
    upon the closing of this offering, (3)&#160;the automatic
    conversion of all outstanding shares of convertible preferred
    stock into shares of common stock and (4)&#160;the assumed
    issuance
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock upon exercise of warrants that will be cancelled
    if not exercised prior to this offering, and excludes:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    833,334&#160;shares of common stock issuable upon the exercise
    of warrants outstanding and exercisable as of June&#160;30, 2009
    at a weighted-average exercise price of $1.12 per share, which
    will remain outstanding after this offering if not exercised
    prior to this offering;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    2,440,885&#160;shares of common stock issuable upon the exercise
    of stock options outstanding and exercisable as of June&#160;30,
    2009 at a weighted-average exercise price of $21.59 per share,
    of which 1,054,930&#160;shares with a weighted-average exercise
    price of $8.52 per share would be vested if purchased upon
    exercise of these options as of June&#160;30, 2009;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    173,828&#160;shares of common stock available for future
    issuance under our equity compensation plans as of June&#160;30,
    2009;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an
    additional&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock that will be made available for future
    issuance under our equity compensation plans upon the closing of
    this offering.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The sale
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock to be sold by the selling stockholders in this
    offering will reduce the number of shares held by existing
    stockholders
    to&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    or&#160;&#160;&#160;&#160;&#160;% of the total shares
    outstanding, and will increase the number of shares held by new
    investors
    to&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    or&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;%
    of the total shares outstanding. If the underwriters exercise
    their option to purchase additional shares in full, the shares
    held by existing stockholders will further decrease
    to&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    or&#160;&#160;&#160;&#160;&#160;% of the total shares
    outstanding, and the number of shares held by new investors will
    further increase
    to&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    or&#160;&#160;&#160;&#160;&#160;% of the total shares
    outstanding.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    34
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='110'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">SELECTED
    CONSOLIDATED FINANCIAL DATA</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following tables summarize our consolidated financial data
    for the periods presented. You should read the following
    selected consolidated financial data in conjunction with our
    financial statements and the related notes appearing at the end
    of this prospectus and the &#147;Management&#146;s Discussion
    and Analysis of Financial Condition and Results of
    Operations&#148; section of this prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We derived the statement of operations data for the years ended
    December&#160;31, 2006, 2007 and 2008 and the balance sheet data
    as of December&#160;31, 2007 and 2008 from our audited
    consolidated financial statements, which are included in this
    prospectus. We derived the statement of operations data for the
    years ended December&#160;31, 2004 and 2005 and the balance
    sheet data as of December&#160;31, 2004, 2005 and 2006 from our
    audited consolidated financial statements, which are not
    included in this prospectus. We derived the consolidated
    financial data for the six months ended June&#160;30, 2008 and
    2009 and as of June&#160;30, 2009 from our unaudited
    consolidated financial statements, which are included in this
    prospectus. In the opinion of our management, the unaudited
    consolidated financial statements have been prepared on the same
    basis as our audited financial statements and include all
    adjustments, consisting of normal recurring adjustments and
    accruals, necessary for the fair statement of the financial
    information set forth in those statements. Our historical
    results for any prior period are not necessarily indicative of
    results to be expected for a full year or any future period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="30%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=08 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=08 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=08 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=08 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Fiscal Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2004</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2005</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2006</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2007</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2009</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="26" nowrap align="center" valign="bottom">
    <B>(In thousands, except share and per share data)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <B>Statement of Operations Data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net services revenue
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    16,199
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    111,201
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    160,741
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    240,725
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    398,469
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    187,261
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    238,149
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Costs of services
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,098
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    97,120
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    141,767
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    197,676
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    335,211
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    160,082
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    195,667
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Operating margin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    101
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14,081
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,974
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43,049
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    63,258
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,179
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42,482
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Operating expenses:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 24pt">
    Infused management and technology
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,082
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,037
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,875
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,872
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,234
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,938
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24,482
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 24pt">
    Selling, general and administrative
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,629
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,230
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,777
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,657
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21,227
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,642
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,308
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 24pt">
    Total operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,711
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,267
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,652
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43,529
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,461
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,580
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,790
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Income (loss) from operations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,610
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3,186
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (8,678
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (480
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,797
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (401
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,692
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Interest income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    379
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    626
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,359
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,710
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    710
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    433
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    83
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Income (loss) before provision for (benefit from) income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,231
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,560
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,230
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,507
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,775
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Provision for (benefit from) income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    105
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    456
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,264
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    626
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,439
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net income (loss)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (6,231
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,666
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    774
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,243
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (594
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,214
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net income (loss) per common share:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Basic:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (1.41
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.15
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.89
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.04
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.70
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.06
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Diluted:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6.82
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (0.16
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1.02
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.03
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (0.73
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (0.06
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    35
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="30%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=08 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=08 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=08 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=08 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Fiscal Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2004</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2005</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2006</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2007</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2009</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="26" nowrap align="center" valign="bottom">
    <B>(In thousands, except share and per share data)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Weighted-average shares used in computing net income (loss) per
    common share:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Basic:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    522,733
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,935,104
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,611,975
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,410,226
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,214,916
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,160,187
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,337,812
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Diluted:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    522,733
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,935,104
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,611,975
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,296,011
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,214,916
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,160,187
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,492,646
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <B>Other Operating Data (unaudited):</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Adjusted EBITDA(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (5,754
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,075
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,125
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,842
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12,220
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,620
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    11,658
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 24pt">
    Net patient revenue under management (at period end) (in
    billions)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6.9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    9.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    8.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    11.9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="47%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>As of December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>As of June&#160;30,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2004</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2005</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2006</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2007</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2009</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="22" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <B>Balance Sheet Data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12,925
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17,558
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    20,782
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34,745
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    51,656
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Working capital
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,494
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,817
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,445
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,010
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3,453
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,114
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,486
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19,064
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,333
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,858
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    86,904
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    105,965
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,603
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    8,535
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,165
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    15,910
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,923
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    20,537
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 8pt">(1)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 8pt">We define adjusted EBITDA as net
    income (loss) before net interest income (expense), income tax
    expense (benefit), depreciation and amortization expense and
    share-based compensation expense. Adjusted EBITDA is a non-GAAP
    financial measure and should not be considered as an alternative
    to net income, operating income and any other measure of
    financial performance calculated and presented in accordance
    with GAAP.
    </FONT></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 0%; font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We believe adjusted EBITDA is useful to investors in evaluating
    our operating performance for the following reasons:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="1%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    adjusted EBITDA and similar non-GAAP measures are widely used by
    investors to measure a company&#146;s operating performance
    without regard to items that can vary substantially from company
    to company depending upon financing and accounting methods, book
    values of assets, capital structures and the methods by which
    assets were acquired;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    securities analysts often use adjusted EBITDA and similar
    non-GAAP measures as supplemental measures to evaluate the
    overall operating performance of companies;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    by comparing our adjusted EBITDA in different historical
    periods, our investors can evaluate our operating results
    without the additional variations of interest income (expense),
    income tax expense (benefit), depreciation and amortization
    expense and share-based compensation expense.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our management uses adjusted EBITDA:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="1%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    as a measure of operating performance, because it does not
    include the impact of items that we do not consider indicative
    of our core operating performance;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    for planning purposes, including the preparation of our annual
    operating budget;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    to allocate resources to enhance the financial performance of
    our business;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    to evaluate the effectiveness of our business
    strategies;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    in communications with our board of directors and investors
    concerning our financial performance.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 0%; font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We understand that, although measures similar to adjusted EBITDA
    are frequently used by investors and securities analysts in
    their evaluation of companies, adjusted EBITDA has limitations
    as an analytical tool, and you should not
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    36
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <FONT style="font-size: 8pt">consider it in isolation or as a
    substitute for analysis of our results of operations as reported
    under GAAP. Some of these limitations are:
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="1%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    adjusted EBITDA does not reflect our cash expenditures or future
    requirements for capital expenditures or other contractual
    commitments;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    adjusted EBITDA does not reflect changes in, or cash
    requirements for, our working capital needs;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    adjusted EBITDA does not reflect share-based compensation
    expense;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    adjusted EBITDA does not reflect cash requirements for income
    taxes;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    adjusted EBITDA does not reflect net interest income (expense);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    although depreciation and amortization are non-cash charges, the
    assets being depreciated or amortized will often have to be
    replaced in the future, and adjusted EBITDA does not reflect any
    cash requirements for these replacements;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    other companies in our industry may calculate adjusted EBITDA
    differently than we do, limiting its usefulness as a comparative
    measure.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 0%; font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    To properly and prudently evaluate our business, we encourage
    you to review the GAAP financial statements included elsewhere
    in this prospectus, and not to rely on any single financial
    measure to evaluate our business.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    37
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table presents a reconciliation of adjusted EBITDA
    to net income (loss), the most comparable GAAP measure:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="25%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=08 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=08 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=08 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=08 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Fiscal Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2004</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2005</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2006</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2009</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="26" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net income (loss)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (6,231
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,666
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    774
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,243
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (594
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,214
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net interest income(a)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (379
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (626
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,359
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,710
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (710
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (433
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (83
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Provision (benefit) for income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    105
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    456
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,264
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    626
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,439
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Depreciation and amortization expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    99
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    626
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,307
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,540
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    920
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,882
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    EBITDA
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (6,588
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (3,088
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (8,052
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    827
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,337
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    519
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,574
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stock compensation expense(b)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    844
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    934
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,551
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,021
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,977
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stock warrant expense(b)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    834
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,013
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    83
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,081
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,332
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,080
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,107
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Adjusted EBITDA
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (5,754
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,075
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,125
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,842
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12,220
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,620
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    11,658
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 4%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: -4%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (a)&#160;Net interest income represents earnings from our cash
    and cash equivalents. No debt or other interest-bearing
    obligations were outstanding during any of the periods presented.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: -4%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (b)&#160;Stock compensation expense and stock warrant expense
    collectively represent the
    <FONT style="white-space: nowrap">share-based</FONT>
    compensation expense reflected in our financial statements. Of
    the amounts presented above, $83, $928, $921, $696 and $1,334
    was classified as a reduction in net services revenue for the
    years ended December&#160;31, 2006, 2007 and 2008 and the six
    months ended June&#160;30, 2008 and 2009, respectively.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    38
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='111'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">MANAGEMENT&#146;S
    DISCUSSION AND ANALYSIS OF<BR>
    FINANCIAL CONDITION AND RESULTS OF OPERATIONS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <I>You should read the following discussion and analysis of our
    financial condition and results of operations together with our
    financial statements and the related notes and other financial
    information included elsewhere in this prospectus. Some of the
    information contained in this discussion and analysis or set
    forth elsewhere in this prospectus, including information with
    respect to our plans and strategy for our business and related
    financing, includes forward-looking statements that involve
    risks and uncertainties. You should review the &#147;Risk
    Factors&#148; section of this prospectus for a discussion of
    important factors that could cause actual results to differ
    materially from the results described in or implied by the
    forward-looking statements contained in the following discussion
    and analysis.</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Overview</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Our
    Background</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accretive Health is a leading provider of healthcare revenue
    cycle management services. Our business purpose is to help
    U.S.&#160;hospitals, physicians and other healthcare providers
    manage their revenue cycle operations more efficiently. Our
    integrated, end-to-end technology and services offering, which
    we refer to as our solution, helps our customers realize
    sustainable improvements in their operating margins and improve
    the satisfaction of their patients, physicians and staff. We
    enable these improvements by helping our customers increase the
    portion of the maximum potential patient revenue they receive,
    while reducing total revenue cycle costs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our customers typically are multi-hospital systems, including
    faith-based or community healthcare systems, academic medical
    centers and independent ambulatory clinics, and their affiliated
    physician practice groups. To implement our solution, we assume
    full responsibility for the management and cost of a
    customer&#146;s revenue cycle operations and supplement the
    customer&#146;s existing revenue cycle staff with seasoned
    Accretive Health personnel. A customer&#146;s net revenue
    improvements and cost savings generally increase over time as we
    deploy additional programs and as the programs we implement
    become more effective, which in turn provides visibility into
    our future revenue and profitability. In 2008, for example,
    approximately 80% of our net services revenue, and over 95% of
    our net income, was derived from customer contracts that were in
    place as of January&#160;1, 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our customers have historically achieved significant net revenue
    yield improvements within 18 to 24&#160;months of implementing
    our solution, with customers operating under mature managed
    service contracts realizing 400 to 600&#160;basis points in
    yield improvements, typically in the third or fourth contract
    year. To date, we have experienced a contract renewal rate of
    100% (excluding exploratory new services offerings, a consensual
    termination following a change of control and a customer
    reorganization). Coupled with the long-term nature of our
    managed service contracts and the fixed nature of the base fees
    under each contract, our historical renewal experience provides
    a core source of recurring revenue.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We believe that current macroeconomic conditions will continue
    to impose financial pressure on healthcare providers and will
    increase the importance of managing their revenue cycles
    effectively and efficiently. Additionally, the continued
    operating pressures facing U.S.&#160;hospitals coupled with some
    of the underlying themes of current healthcare reform proposals
    make the efficient management of the revenue cycle and
    collection of the full amount of payments due for patient
    services among the most critical challenges facing healthcare
    providers today.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our corporate headquarters are located in Chicago, Illinois, and
    we operate shared services centers and offices in Michigan,
    Missouri, Florida and India. As of June&#160;30, 2009, we had
    approximately 1,300&#160;full-time employees and managed an
    additional 6,000 revenue cycle staff persons who are employed by
    our customers.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    39
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Net Services
    Revenue</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We derive our net services revenue primarily from service
    contracts under which we manage our customers&#146; revenue
    cycle operations. Revenues from managed service contracts
    consist of base fees and incentive payments:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Base fee revenues represent our fees for managing and overseeing
    our customers&#146; revenue cycle operations, net of any cost
    savings shared with customers.
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Incentive payment revenues represent the amounts we receive by
    increasing our customers&#146; net patient revenue and
    identifying potential payment sources for patients who are
    uninsured and underinsured. These payments are governed by
    specific formulas contained in the managed service contract with
    each of our customers.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In addition, we earn revenue from other services, which
    primarily include our share of revenues associated with the
    collection of dormant patient accounts (more than 365&#160;days
    old) under some of our service contracts. We also receive
    revenue from other services provided to customers that are not
    part of our integrated service offerings, such as reviewing a
    customer&#146;s charge data master or consulting on the billing
    for individuals receiving emergency room treatment.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Some of our service contracts entitle customers to receive a
    share of the cost savings we achieve from operating their
    revenue cycle. This share is returned to customers as a
    reduction in subsequent base fees. Our services revenue is
    reported net of cost sharing, and we refer to this as our net
    services revenue.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Costs of
    Services</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Costs of services consist primarily of the expenses necessary to
    conduct our customers&#146; revenue cycle operations. These
    costs include the salaries and benefits of the customers&#146;
    employees engaged in revenue cycle activities and managed
    <FONT style="white-space: nowrap">on-site</FONT> by
    us, the salaries and benefits of our employees engaged in
    revenue cycle activities, the costs associated with vendors that
    provide services integral to the customers&#146; revenue cycle
    and the costs associated with operating our shared services
    centers.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Operating
    Margin</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Operating margin is equal to net services revenue less costs of
    services. Our operating model is designed to improve margin
    under each managed service contract as the contract matures, for
    several reasons:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    We typically enhance the productivity of a customer&#146;s
    revenue cycle operations over time as we fully implement our
    technology and procedures and because any overlap between costs
    of our shared services centers and costs of hospital operations
    targeted for transition is generally concentrated in the first
    year of the contract.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Incentive payments under each managed service contract generally
    increase over time as we deploy additional programs and the
    programs we implement become more effective and produce improved
    results for our customers.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Infused
    Management and Technology Expenses</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We refer to the management and staff revenue cycle employees
    that we devote to customer operations as infused management.
    Infused management and technology expenses consist primarily of
    the wages, bonuses, benefits, share based compensation, travel
    and other costs associated with deploying our employees on
    customer sites to guide and manage our customers&#146; revenue
    cycle operations. The employees we deploy on customer sites
    typically have significant experience in revenue cycle
    operations, technology, quality control or other management
    disciplines. The other significant portion of these expenses is
    an allocation of the costs associated with maintaining,
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    40
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    improving and deploying our integrated proprietary technology
    suite and an allocation of the costs previously capitalized for
    developing our integrated proprietary technology suite.
</DIV>

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    <B><I><FONT style="font-family: Arial, Helvetica">Selling,
    General and Administrative Expenses</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Selling, general and administrative expenses consist primarily
    of expenses for executive, sales, corporate information
    technology, legal, finance and human resources personnel,
    including wages, bonuses, benefits and share-based compensation;
    fees for professional services; share-based expense for stock
    warrants; insurance premiums; facility charges; and other
    corporate expenses. Professional services consist primarily of
    external legal, tax and audit services. We expect selling,
    general and administrative expenses to increase in absolute
    dollars as we continue to add information technology, human
    resources, finance, accounting and other administrative
    personnel as we expand our business.
</DIV>

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    We also expect to incur additional professional fees and other
    expenses resulting from future expansion and the compliance
    requirements of operating as a public company, including
    increased audit and legal expenses, investor relations expenses,
    increased insurance expenses, particularly for directors&#146;
    and officers&#146; liability insurance, and the costs of
    complying with Section&#160;404 of the Sarbanes-Oxley Act. While
    these costs may initially increase as a percentage of our net
    services revenue, we expect that in the future these expenses
    will increase at a slower rate than our overall business volume,
    and that they will eventually represent a smaller percentage of
    our net services revenue.
</DIV>

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    <B><I><FONT style="font-family: Arial, Helvetica">Interest
    Income</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Interest income is derived from the return achieved from our
    cash balances. We invest primarily in highly liquid, short-term
    investments, primarily those insured by the
    U.S.&#160;government. Our return on our cash investments
    declined in 2008 and the six months ended June&#160;30, 2009 as
    a result of the general decrease in overall interest rates.
</DIV>

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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Income
    Taxes</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Income tax expense consists of federal and state income taxes in
    the United States and India. Although we have net operating loss
    carryforwards, our effective tax rate in 2008 was approximately
    65%. This is due principally to the fact that a large portion of
    our operations is conducted in Michigan, which in 2008 began to
    impose a tax based on gross receipts in addition to tax based on
    net income. We expect our overall effective tax rate to be lower
    in 2009 and thereafter as the impact of the Michigan gross
    receipts tax becomes less significant in relation to other
    income-based taxes. However, we expect our income tax expense to
    increase in absolute dollars as our income increases.
</DIV>

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    <B><FONT style="font-family: Arial, Helvetica">Application of
    Critical Accounting Policies and Use of Estimates</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our consolidated financial statements reflect the assets,
    liabilities and results of operations of Accretive Health, Inc.
    and our wholly-owned subsidiaries, SureDecisions, Inc.,
    Accretive Health India Private Limited and Accretive Health
    India Services Private Limited. All intercompany transactions
    and balances have been eliminated in consolidation. Our
    consolidated financial statements have been prepared in
    accordance with GAAP.
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The preparation of financial statements in conformity with GAAP
    requires us to make estimates and judgments that affect the
    amounts reported in our consolidated financial statements and
    the accompanying notes. We regularly evaluate the accounting
    policies and estimates we use. In general, we base estimates on
    historical experience and on assumptions that we believe to be
    reasonable given our operating environment. Estimates are based
    on our best knowledge of current events and the actions we may
    undertake in the future. Although we believe all adjustments
    considered necessary for fair presentation have been included,
    our actual results may differ materially from our estimates.
</DIV>

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    We believe that the accounting policies described below involve
    our more significant judgments, assumptions and estimates and,
    therefore, could have the greatest potential impact on our
    consolidated financial statements. In addition, we believe that
    a discussion of these policies is necessary to understand and
    evaluate the consolidated financial statements contained in this
    prospectus. For further information on our critical and other
    significant accounting policies, see note&#160;2 to our
    consolidated financial statements contained elsewhere in this
    prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Revenue
    Recognition</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our managed service contracts generally have an initial term of
    four to five years and various start and end dates. After the
    initial terms, these contracts renew annually unless canceled by
    either party.
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We record revenue in accordance with the provisions of Staff
    Accounting Bulletin&#160;104. As a result, we only record
    revenue once there is persuasive evidence of an arrangement,
    services have been rendered, the amount of revenue has become
    fixed or determinable and collectibility is reasonably assured.
    We recognize base fee revenues on a straight-line basis over the
    life of the managed service contract. Base fees for contracts
    which are received in advance of services delivered are
    classified as deferred revenue until services have been provided.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our managed service contracts generally allow for adjustments to
    the base fee. Adjustments typically occur at 90, 180 or
    360&#160;days after the contract commences, but can also occur
    at subsequent dates as a result of factors including changes to
    the scope of operations and internal and external audits. All
    adjustments, which can increase or decrease revenue and
    operating margin, are recorded in the period the changes are
    known and collectibility is reasonably assured. Any such
    adjustments may cause our quarter-to-quarter results of
    operations to fluctuate. Adjustments may vary in direction,
    frequency and magnitude and generally have not materially
    affected our annual revenue trends, margin trends, and
    visibility.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We record revenue for incentive payments once the calculation of
    the incentive payment earned is finalized and collectibility is
    reasonably assured. We use a proprietary technology and
    methodology to calculate the amount of benefit each customer
    receives as a result of our services. Our calculations are based
    in part on the amount of revenue each customer is entitled to
    receive from commercial and private insurance carriers,
    Medicare, Medicaid and patients. Because the laws, regulations,
    instructions, payor contracts and rule interpretations governing
    how our customers receive payments from these parties are
    complex and change frequently, estimates of the prior period net
    revenue yield calculations could change. All changes in
    estimates are recorded when new information is available and
    calculations are completed.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Incentive payments are based on the benefits a customer has
    received throughout the life of the managed service contract
    with us. Each quarter, we record the increase in the total
    benefits received to date. If a quarterly calculation indicates
    that the cumulative benefits to date have decreased, we record a
    reduction in revenue. If the decrease in revenue exceeds the
    amount previously paid by the customer, the excess is recorded
    as deferred revenue.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our services also include collection of dormant patient accounts
    receivable that have aged 365&#160;days or more directly from
    individual patients. We share all cash generated from these
    collections with our customers in accordance with specified
    arrangements. We record as revenue our portion of the cash
    received from these collections when each customer&#146;s cash
    application is complete.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Accounts
    Receivable and Allowance for Uncollectible
    Accounts</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Base fees are billed to customers quarterly. Base fees received
    prior to when services are delivered are classified as deferred
    revenue. Accordingly, the timing of customer payments can result
    in short-term fluctuations in cash, accounts receivable and
    deferred revenue.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We extend unsecured credit to our customers based on our
    assessment of each customer&#146;s creditworthiness. We maintain
    an estimated allowance for doubtful accounts to reduce our gross
</DIV>

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    accounts receivable to the amount that we believe will be
    collected. This allowance is reviewed and based on our
    historical experience, our assessment of each customer&#146;s
    ability to pay and the status of any ongoing operations with
    each applicable customer.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Software
    Development</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We apply the provisions of the American Institute of Certified
    Public Accountants&#146; Statement of Position
    <FONT style="white-space: nowrap">No.&#160;98-1,</FONT>
    or
    <FONT style="white-space: nowrap">SOP&#160;98-1,</FONT>
    <I>Accounting for Costs of Computer Software Developed or
    Obtained for Internal Use</I>, which requires the capitalization
    of costs incurred in connection with developing or obtaining
    internal use software. In accordance with
    <FONT style="white-space: nowrap">SOP&#160;98-1,</FONT>
    we capitalize the costs of internally-developed, internal use,
    software when an application is in the development stage. This
    generally occurs after the overall design and functionality of
    the application has been approved and our management has
    committed to the application&#146;s development. Capitalized
    software development costs consist of payroll and
    payroll-related costs for employee time spent developing a
    specific internal use software application, and external costs
    incurred that are related directly to the development of a
    specific application.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Goodwill</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Goodwill represents the excess purchase price over the net
    assets acquired for SureDecisions, which we acquired in May
    2006. In accordance with Statement of Financial Accounting
    Standards No.&#160;142, <I>Goodwill and Other Intangible
    Assets</I>, goodwill is not subject to amortization but is
    subject to impairment testing at least annually. Our annual
    impairment assessment date is the first day of our fourth
    quarter. We conduct our impairment testing on a company-wide
    basis because we have only one operating and reporting segment.
    Our impairment tests are based on our current business strategy
    in light of present industry and economic conditions and future
    expectations. As we apply our judgment to estimate future cash
    flows and an appropriate discount rate, the analysis reflects
    assumptions and uncertainties. Our estimates of future cash
    flows could differ from actual results. Our most recent
    impairment assessment did not result in goodwill impairment.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Impairments of
    Long-Lived Assets</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We evaluate all of our long-lived assets, such as furniture,
    equipment, software and other intangibles, for impairment in
    accordance with Statement of Financial Accounting Standard
    No.&#160;144, <I>Accounting for the Impairment or Disposal of
    Long-Lived Assets</I>, when events or changes in circumstances
    warrant such a review. If an evaluation is required, the
    estimated future undiscounted cash flows associated with the
    asset are compared to the asset&#146;s carrying amount to
    determine if an adjustment to fair market value is required.
    This evaluation is significantly impacted by estimates and
    assumptions of future revenue, expenses and other factors, which
    are in turn affected by changes in the business climate, legal
    matters and competition. Our most recent assessment of
    intangible assets resulted in the impairment of customer
    relationships acquired as part of our SureDecisions acquisition
    in the amount of $0.1&#160;million, which was recorded in 2008.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Income
    Taxes</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We record deferred tax assets and liabilities for future income
    tax consequences that are attributable to differences between
    the carrying amount of assets and liabilities for financial
    statement purposes and the income tax bases of such assets and
    liabilities. We base the measurement of deferred tax assets and
    liabilities on enacted tax rates that we expect will apply to
    taxable income in the year we expect to settle or recover those
    temporary differences. We recognize the effect on deferred
    income tax assets and liabilities of any change in income tax
    rates in the period that includes the enactment date. We provide
    a valuation allowance for deferred tax assets if, based upon the
    available evidence, it is more likely than not that some or all
    of the deferred tax assets will not be realized.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2008 and in all prior periods, a
    valuation allowance was provided for all of our net deferred tax
    assets. As a result of our improved operations, in the second
    quarter of 2009 we
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    determined that it was no longer necessary to maintain a
    valuation allowance for all of our deferred tax assets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The primary sources of our deferred taxes are:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    differences in timing of depreciation on fixed assets;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the timing of revenue recognition arising from incentive
    payments;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    employee compensation costs arising from stock options;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    costs associated with the issuance of warrants to purchase
    shares of our common stock;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the existence of net operating loss carryforwards.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Beginning January&#160;1, 2008, with the adoption of FASB
    Interpretation No.&#160;48, <I>Accounting for Uncertainty in
    Income Taxes</I>, or FIN&#160;48, we recognize the financial
    statement effects of a tax position only when it is more likely
    than not that the position will be sustained upon examination.
    Tax positions taken or expected to be taken that are not
    recognized under the pronouncement are recorded as liabilities.
    For interest and penalties relating to income taxes, we
    recognize accrued interest in income tax expense and penalties
    in our income tax provision in the statements of consolidated
    operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Share-Based
    Compensation Expense</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our share-based compensation expense results from issuances of
    shares of restricted common stock and grants of stock options
    and warrants to employees, directors, outside consultants,
    customers, vendors and others. We recognize the costs associated
    with option and warrant grants using the fair value recognition
    provisions of Statement of Financial Accounting Standards
    No.&#160;123(R), <I>Share-Based Payment</I>, which we refer to
    as SFAS&#160;123(R). Generally, SFAS&#160;123(R) requires the
    value of all share-based payments to be recognized in the
    statement of operations based on their estimated fair value at
    date of grant amortized over the grant&#146;s vesting period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Restricted Stock Plan.</I></B>&#160;&#160;Our restricted
    stock plan was adopted by our board of directors in March 2004
    and amended in June 2004. As of June&#160;30, 2009, there were
    6,599,591&#160;shares of common stock outstanding under our
    restricted stock plan, all of which were vested. We have made
    the following grants to employees, directors and consultants
    under the restricted stock plan:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    In March 2004, we issued shares of common stock to our chief
    executive officer. The shares vested in 48&#160;monthly
    installments beginning in November 2003. As a result, we
    recorded share-based compensation expense of $19,200 in each of
    2006 and 2007.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    In June 2004, we issued shares of common stock to certain
    employees and directors. In January 2005, we issued additional
    shares of common stock to a member of our board of directors.
    These shares vested on various schedules ranging from immediate
    vesting to vesting over a period of 48&#160;months. As a result,
    we recorded share-based compensation expense of $30,896,
    $18,530, $2,328 and $2,328 in 2006, 2007 and 2008 and the six
    months ended June&#160;30, 2008, respectively.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Ascension Health Stock and Warrants.</I></B>&#160;&#160;In
    October 2004, Ascension Health became our founding customer.
    Since then, in exchange for its initial
    <FONT style="white-space: nowrap">start-up</FONT>
    assistance and subsequent sales and marketing assistance, we
    have issued common stock and granted warrants to Ascension
    Health, as described below:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Initial Stock Issuance and Protection Warrant
    Agreement</I></B>.&#160;&#160;In October and November 2004, we
    issued 902,374&#160;shares of common stock to Ascension Health,
    then representing a 5% ownership interest in our company on a
    fully-diluted basis, and entered into a protection warrant
    agreement under which Ascension Health is granted the right to
    purchase additional shares of common stock from time to time for
    $0.01 per share when Ascension Health&#146;s ownership interest
    in our company declines below 5% due to our issuance of
    additional stock
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    44
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    or rights to purchase stock. The protection warrant agreement,
    and all purchase rights granted thereunder, expire on the
    closing of this offering. We made the initial stock grant and
    entered into the protection warrant agreement because Ascension
    Health agreed to provide us with an operational laboratory and
    related
    <FONT style="white-space: nowrap">start-up</FONT>
    consulting services in connection with our development of our
    initial revenue cycle management service offering.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 6%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In 2006, 2007 and 2008 and the six months ended June&#160;30,
    2008 and 2009, we granted Ascension Health the right to purchase
    15,752, 58,175, 23,261, 19,358 and 25,837&#160;shares of common
    stock for $0.01 per share, respectively, pursuant to the
    protection warrant agreement. We accounted for the costs
    associated with these purchase rights as a reduction in base fee
    revenues due to us from Ascension Health because Ascension
    Health was not required to provide us with any further services
    in connection with these grants. Accordingly, we reduced the
    amount of our base fee revenues from Ascension Health by
    $82,843, $928,108, $921,445, $696,385 and $1,334,131 in 2006,
    2007 and 2008 and the six months ended June&#160;30, 2008 and
    2009, respectively. For additional information regarding our
    relationship with Ascension Health, see &#147;Related Person
    Transactions&#160;&#151; Transactions With Ascension
    Health&#148;.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Supplemental Warrant.</I></B>&#160;&#160;Pursuant to a
    supplemental warrant agreement that became effective in November
    2004, Ascension Health had the right to purchase up to
    902,374&#160;shares of our common stock based upon the
    achievement of specified milestones relating to its sales and
    marketing assistance. In May 2007, we amended and restated our
    supplemental warrant agreement with Ascension Health. This
    agreement gives Ascension Health the right to purchase up to
    446,190&#160;shares of common stock upon the achievement of
    specified milestones relating to its sales and marketing
    assistance. The purchase price for these shares is equal to the
    most recent price per share paid for our common stock in a
    capital raising transaction or, if we have not had a capital
    raising transaction within the preceding six months, the
    exercise price of the employee stock options we have most
    recently granted. The supplemental warrant agreement, and all
    purchase rights thereunder, expire on the closing of this
    offering. Concurrently with the amendment and restatement of the
    supplemental warrant agreement, in May 2007, we sold
    669,284&#160;shares of our common stock to Ascension Health for
    $8.20 per share for an aggregate purchase price of $5,488,128.
    No share-based compensation expense was recorded in connection
    with this sale because the shares were issued at a purchase
    price equal to the fair market value of the common stock at that
    time and Ascension Health was not required to provide any
    services in connection with the issuance.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 6%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We recorded the costs associated with the purchase rights under
    the supplemental warrant agreement as marketing expense for the
    periods in which the purchase rights were earned. During
    December 2007, Ascension Health earned the right to purchase
    223,095&#160;shares of common stock for $17.36 per share, and we
    recorded $4,153,163 in selling, general and administrative
    expense. During March 2008, Ascension Health earned the right to
    purchase 111,548&#160;shares of common stock for $40.17 per
    share, and we recorded $2,410,790 in marketing expense. During
    March 2009, Ascension Health earned the right to purchase
    111,547&#160;shares of common stock for $51.05 per share, and we
    recorded $2,772,953 in marketing expense.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Licensing and Consulting Warrant.</I></B>&#160;&#160;In
    conjunction with the start of our business, in February 2004, we
    executed a term sheet with a consulting firm and its principal
    contemplating that we would grant the consulting firm a warrant,
    with an exercise price equal to the fair market value of our
    common stock upon grant, to purchase shares of our common stock
    then representing 2.5% of our equity in exchange for exclusive
    rights to certain revenue cycle methodologies, tools,
    technology, benchmarking information and other intellectual
    property, plus up to another 2.5% of our equity at the time of
    grant if the consulting firm&#146;s introduction of us to senior
    executives at prospective customers resulted in the execution of
    managed service contracts between us and such customers. In
    January 2005, we formalized the warrant grant contemplated by
    the term sheet and granted the consulting firm a warrant to
    purchase 833,334&#160;shares of our common stock for $1.12 per
    share, representing 5% of
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    45
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    our equity at that time. In 2005, we recorded $483,334 in
    selling, general and administrative expense in conjunction with
    this warrant grant. The warrant expires on the earlier of
    January&#160;15, 2015 or a change of control of our company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We used the modified Black-Scholes option pricing model to
    determine the estimated fair value of the above purchase rights
    at the date earned. The following table sets forth the
    significant assumptions used in the model during 2006, 2007,
    2008 and the six months ended June&#160;30, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="33%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="13%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="15%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="9%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="19%">&nbsp;</TD>	<!-- colindex=05 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="5" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2006</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">June&#160;30, 2009</FONT></B>
</DIV>
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future dividends
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#151;&#160;&#160;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#151;&#160;&#160;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#151;&#160;&#160;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#151;&#160;&#160;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Risk-free interest rate
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    3.9% to 5.2%
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    2.75% to 4.21%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    3.45%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    2.91%
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Expected volatility
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    60%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    50%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    50%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    50%
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Expected life(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    7.8&#160;years
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    6.8&#160;years
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    6.6&#160;years
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    5.6&#160;years
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Expected life applies to Ascension Health&#146;s supplemental
    warrant only, since the other warrants were fully vested upon
    grant.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Stock Option Plan.</I></B>&#160;&#160;In December 2005,
    our board of directors approved a stock option plan, which
    provides for the grant of stock options to employees, directors
    and consultants. The plan was amended and restated in February
    2006. As of June&#160;30, 2009, the plan permitted the issuance
    of a maximum of 3,544,862&#160;shares of common stock and
    173,828&#160;shares were available for grant. Under the terms of
    the plan, all options will expire if they are not exercised
    within ten years after the grant date. The majority of options
    granted vest over four years at a rate of 25% per year on each
    grant date anniversary. Options can be exercised immediately
    upon grant, but upon exercise the shares issued are subject to
    the same vesting and repurchase provisions that applied before
    exercise.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to January&#160;1, 2006, we accounted for share-based
    compensation using the intrinsic value method prescribed in
    Accounting Principles Board Opinion No.&#160;25, <I>Accounting
    for Stock Issued to Employees</I>, and related interpretations,
    as permitted by Statement of Financial Accounting Standards
    No.&#160;123, <I>Accounting for Stock-Based Compensation</I>,
    which we refer to as SFAS&#160;123. Accordingly, compensation
    expense for stock options was measured as the excess, if any, of
    the fair market value of our common stock at the measurement
    date (the date of grant for stock options) over the exercise
    price. Since we only granted employee stock options with an
    exercise price equal to fair market value on the date of grant,
    we did not record any compensation expense for stock option
    grants prior to January&#160;1, 2006.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Effective January&#160;1, 2006, we adopted the fair value
    recognition provisions of SFAS&#160;123(R) using the modified
    prospective transition method. Under this method:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    compensation expense for share-based awards granted prior to
    January&#160;1, 2006 is recognized over the remaining service
    period based on the grant date fair value estimated in
    accordance with the original provisions of
    SFAS&#160;123;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    compensation expense for all share-based awards granted
    subsequent to December&#160;31, 2005 is recognized over the
    service period based on the grant date fair value estimated in
    accordance with the provisions of SFAS&#160;123(R).
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We use the modified Black-Scholes option pricing model to
    determine the estimated fair value of each option as of its
    grant date. These inputs are subjective and generally require
    significant analysis
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    46
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    and judgment to develop. The following table sets forth the
    significant assumptions used in the model during 2006, 2007,
    2008 and the six months ended June&#160;30, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="27%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="15%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="13%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="15%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="19%">&nbsp;</TD>	<!-- colindex=05 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="5" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2006</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">June&#160;30, 2009</FONT></B>
</DIV>
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future dividends
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#151;&#160;&#160;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#151;&#160;&#160;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#151;&#160;&#160;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Forfeitures
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    1.88% annually
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    7.5% annually
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    3.75% annually
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    3.75% annually
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Risk-free interest rate
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    3.9% to 5.2%
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    2.3% to 5.5%
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    2.8 to 4.0%
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    1.6% to 2.4%
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Expected volatility
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    60%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    50%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    50%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    50%
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Expected life
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    6.25&#160;years
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    6.25&#160;years
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    6.25&#160;years
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    6.25&#160;years
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Since our stock is not actively traded, we estimated its
    expected volatility by reviewing the historical volatility of
    the common stock of public companies that operate in similar
    industries or are similar in terms of stage of development or
    size and then projecting this information toward our future
    expected results. We used judgment in selecting these companies,
    as well as in evaluating the available historical and implied
    volatility for these companies.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We aggregate all employees into one pool for valuation purposes.
    The risk-free rate is based on the U.S.&#160;treasury yield
    curve in effect at the time of grant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The plan has not been in existence a sufficient period for us to
    use our historical experience to estimate expected life.
    Furthermore, data from other companies is not readily available.
    Therefore, we have estimated our stock options&#146; expected
    life using a simplified method based on the average of each
    option&#146;s vesting term and original contractual term. This
    methodology is set forth in Staff Accounting
    Bulletin&#160;No.&#160;107 and its use is permitted by Staff
    Accounting Bulletin&#160;No.&#160;110.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The estimated forfeiture rate is derived from our historical
    data and our estimates of the likely future actions of option
    holders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We will continue to use judgment in evaluating the expected
    term, volatility and forfeiture rate related to our own
    share-based compensation on a prospective basis, and
    incorporating these factors into the Black-Scholes pricing
    model. Higher volatility and longer expected lives result in an
    increase to share based compensation expense determined at the
    date of grant. In addition, any changes in the estimated
    forfeiture rate can have a significant effect on reported
    share-based compensation expense, as the cumulative effect of
    adjusting the rate for all expense amortization is recognized in
    the period that the forfeiture estimate is changed. If a revised
    forfeiture rate is higher than the previously estimated
    forfeiture rate, an adjustment is made that will result in a
    decrease to the share-based compensation expense recognized in
    our consolidated financial statements. If a revised forfeiture
    rate is lower than the previously estimated forfeiture rate, an
    adjustment is made that will result in an increase to the share
    based compensation expense recognized in our consolidated
    financial statements. These adjustments will affect our infused
    management and technology expenses and selling, general and
    administrative expenses.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of June&#160;30, 2009, we had $18.1&#160;million of total
    unrecognized share-based compensation cost related to employee
    stock options. We expect to recognize this cost over a
    weighted-average period of 3.1&#160;years after July&#160;1,
    2009. The allocation of this cost between selling, general and
    administrative expenses and infused management and technology
    expenses will depend on the salaries and work assignments of the
    personnel holding these stock options.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Determination of Fair Value.</I></B>&#160;&#160;Valuing
    the share price of a privately-held company is complex. We
    believe that we have used reasonable methodologies, approaches
    and assumptions in assessing and determining the fair value of
    our common stock for financial reporting purposes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We determine the fair value of our common stock through periodic
    internal valuations that are approved by our board of directors.
    The fair value approved by our board is used for all option
    grants until such time as a new determination of fair value is
    made. To date, and as permitted by our stock
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    47
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    option plan, our chief executive officer has selected option
    recipients and determined the number of shares covered by, and
    the timing of, option grants.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our board considers the following factors when determining the
    fair value of our common stock:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our financial condition, sales levels and results of operations
    during the relevant period;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    developments in our business;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    hiring of key personnel;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    forecasts of our financial results and market conditions
    affecting our industry;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    market values, sales levels and results of operations for public
    companies that we consider comparable in terms of size, service
    offerings and maturity;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the superior rights and preferences of outstanding securities
    that were senior to our common stock;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the illiquid nature of our common stock.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    From June 2005 to January 2008, we used the market approach to
    estimate our enterprise value. The market approach estimates the
    fair market value of a company by applying market multiples of
    publicly-traded firms in the same or similar lines of business
    to the results and projected results of the company being
    valued. When choosing companies for use in the market approach,
    we focused on businesses that provide outsourcing, consulting or
    technology services or that have high rates of growth. To obtain
    our preliminary enterprise value, we calculated the multiple of
    the market valuations of the comparable companies to their
    annual revenues and applied this multiple to our revenue run
    rate, defined as our total projected revenues for the next
    12&#160;months from existing customers. We then discounted the
    preliminary enterprise value by a percentage determined by our
    board to reflect our company&#146;s relative immaturity in
    relation to the comparable companies. This discount changed over
    time as we matured. The resulting value was then divided by the
    number of shares of common stock outstanding on a fully-diluted
    basis to obtain the fair value per share of common stock. We
    performed a new valuation in this manner each time we signed a
    managed service contract with a new customer.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    For all valuations since January 2008, we used both the market
    approach and the income approach to estimate our aggregate
    enterprise value at each valuation date. The change in valuation
    method was in recognition that in 2007 we had achieved some
    significant milestones, particularly positive net income and
    positive adjusted EBITDA for the year, and that an initial
    public offering or other type of liquidity event would
    eventually be considered. When choosing companies to be used for
    the market approach since January 2008, we focused on businesses
    with high rates of growth and relatively low profitability that
    provide services to hospitals or other medical providers, or
    that provide business outsourcing solutions. The comparable
    companies have remained largely unchanged since January 2008.
    The income approach involves applying an appropriate
    risk-adjusted discount rate to projected debt-free cash flows,
    based on forecasted revenue and costs. The financial forecasts
    were based on assumed revenue growth rates that took into
    account our past experience and future expectations. We assessed
    the risks associated with achieving these forecasts and applied
    an appropriate cost of capital rate based on our board&#146;s
    view of our company&#146;s stage of development and risks, the
    experience of our directors in managing companies backed by
    private equity investors, and our management&#146;s review of
    academic research on this topic.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We averaged the two values derived under the market approach and
    the income approach and then added our current cash position and
    cash and tax benefits, assuming that all outstanding options and
    warrants were exercised, to create an enterprise value. Next, we
    allocated the enterprise value to our securities with rights and
    preferences that are superior to our common stock, using the
    option-pricing method set forth in the American Institute of
    Certified Public Accountants Practice Aid, <I>Valuation of
    Privately-Held-Company Equity Securities Issued as
    Compensation</I>. We then discounted
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    48
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    the remaining value by 10% to reflect the fact that our
    stockholders could not freely trade our common stock in the
    public markets. We based the 10% discount for lack of
    marketability primarily on the results of a study of this topic
    by Bajaj, Denis, Ferris and Sarin entitled &#147;Firm Value and
    Marketability Discounts&#148; (February&#160;26, 2001). The
    resulting value was then divided by the number of shares of
    common stock outstanding on a fully-diluted basis to obtain the
    fair value per share of common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to this offering, stock options and certain warrants
    represented the right to purchase shares of our non-voting
    common stock. Upon the closing of this offering, all outstanding
    non-voting common stock will convert into voting common stock on
    a share-for-share basis, and thereafter stock options and
    warrants to purchase non-voting common stock will be stock
    options and warrants to purchase voting common stock, with no
    other changes in their terms. For all valuations prior to
    May&#160;19, 2009, we determined the fair value of the voting
    common stock and applied it to the non-voting common stock
    without a discount.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Beginning on May&#160;19, 2009, we refined our valuation
    methodology because of the increased potential for an initial
    public offering or company sale. We continued to use both the
    market approach and the income approach, but applied a discount
    to the fair value of the non-voting common stock and modified
    other variables as described below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    There is inherent uncertainty in these forecasts and
    projections. If we had made different assumptions and estimates
    than those described above, the amount of our share-based
    compensation expense, net income or loss and related per-share
    amounts could have been materially different.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Information regarding share-based compensation from
    January&#160;1, 2008 through June&#160;30, 2009 is summarized in
    the table below:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="50%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="46%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Number of Shares of Common Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Grant Period</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Subject to Option and Warrant
    Grants</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    January&#160;1, 2008 to January&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    52,105
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    February&#160;1, 2008 to June&#160;9, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    258,634
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    June&#160;10, 2008 to September&#160;2, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    98,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    September&#160;3, 2008 to October&#160;2, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    October&#160;3, 2008 to January&#160;16, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    79,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    January&#160;17, 2009 to May&#160;18, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    259,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    May&#160;19, 2009 to June&#160;30, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    89,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The analyses undertaken in determining the fair value of our
    common stock for all grants between January&#160;1, 2008 and
    June&#160;30, 2009 are summarized below. The methodology for the
    fair value determination made on September&#160;4, 2007 is
    summarized above. All analyses since then used the market
    approach and the income approach summarized above, with the
    additional assumptions described below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>September&#160;4, 2007 Fair Value
    Determination.</I></B>&#160;&#160;For grants made between
    January&#160;1, 2008 and January&#160;31, 2008, we used $17.36
    per share as the fair value of our common stock, based on a
    determination of fair value made by our board of directors on
    September&#160;4, 2007. The market approach resulted in a value
    that was 1.5 times our annual revenue run rate as of the
    valuation date.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>February&#160;1, 2008 Fair Value
    Determination.</I></B>&#160;&#160;On February&#160;1, 2008, our
    board of directors determined that the fair value of our common
    stock was $40.17 per share. The market approach resulted in a
    value that was approximately 3.53 times our net services revenue
    for the third quarter of 2007. For the income approach, we
    forecasted our cash flows over a five-year period and assumed
    that our terminal value would approximate 12.5 times our
    adjusted EBITDA for the fifth future year. We obtained the
    present value of each year&#146;s cash flow by applying a 25%
    discount rate. Next, we averaged the values resulting from the
    income
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    49
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    approach and the market approach and added our cash on hand at
    December&#160;31, 2007 and the estimated cash and tax benefits
    that would occur assuming that all outstanding options and
    warrants were exercised. The resulting value represented our
    estimate of our enterprise value. We allocated 48.9% of the
    estimated enterprise value to securities with rights and
    preferences that are superior to our common stock, assuming a
    future volatility rate of 54.25% and that a liquidity event
    would occur in 18&#160;months. We then reduced the remaining
    value attributable to common stock by 10% for non-marketability,
    and divided the result by the number of shares outstanding on a
    fully-diluted basis to arrive at the estimated fair value per
    share.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>June&#160;10, 2008 Fair Value
    Determination.</I></B>&#160;&#160;On June&#160;10, 2008, our
    board of directors determined that the fair value of our common
    stock was $47.19 per share. The increase in our value per share
    was due to increases in our estimated enterprise value under
    both the market approach and the income approach. We continued
    to apply a 50% weighting to each value and then to increase the
    result by the amount of our cash on hand and the anticipated
    cash and tax benefits from option and warrant exercises. The
    value determined by the market approach on June&#160;10, 2008,
    which was approximately 3.52 times our net services revenue for
    the first quarter of 2008, was higher than the value determined
    on February&#160;1, 2008 because of the increase in our net
    services revenue in the first quarter of 2008 as compared to the
    third quarter of 2007. For the income approach, we used the same
    discount rate and methodology as in the February&#160;1, 2008
    valuation and updated our cash flow projections to reflect our
    new five-year plan. The percentage allocation of our estimated
    enterprise value to senior securities and common stock was
    unchanged from the prior valuation.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>September&#160;3, 2008 Fair Value
    Determination.</I></B>&#160;&#160;On September&#160;3, 2008, our
    board of directors determined that the fair value of our common
    stock was $58.65 per share. The increase in our value per share
    was due to increases in our estimated enterprise value under
    both the market approach and the income approach. We continued
    to apply a 50% weighting to each value and then to increase the
    result by the amount of our cash on hand and the anticipated
    cash and tax benefits from option and warrant exercises. The
    value determined by the market approach on September&#160;3,
    2008 was higher than the value determined on June&#160;10, 2008
    because of the increase in our net services revenue in the
    second quarter of 2008 as compared to the first quarter of 2008
    and because we increased the net services revenue multiple from
    3.52 to 3.78 to reflect increases in market prices of the
    comparable companies. For the income approach, we used the same
    discount rate and methodology as in the June&#160;10, 2008
    valuation, except that we discounted the projected cash flows
    and terminal value for three fewer months. The percentage
    allocation of our estimated enterprise value to senior
    securities and common stock was unchanged from the prior
    valuation.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>October&#160;3, 2008 Fair Value
    Determination.</I></B>&#160;&#160;On October&#160;3, 2008, our
    board of directors determined that the fair value of our common
    stock was $55.77 per share. There were no changes in the
    estimated enterprise value determined under the income approach.
    The board believed, however, that the significant decline in the
    market values of publicly traded securities that occurred during
    the month of September 2008 warranted a reduction in the net
    services revenue multiple from 3.78 to 3.40, resulting in a
    decrease in our estimated enterprise value under the market
    approach. All other aspects of the valuation methodology
    remained unchanged from the September&#160;3, 2008 valuation.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>January&#160;17, 2009 Fair Value
    Determination.</I></B>&#160;&#160;On January&#160;17, 2009, our
    board of directors determined that the fair value of our common
    stock was $51.05 per share. The decrease in our value per share
    was primarily due to a decrease in our estimated enterprise
    value under the market approach. We continued to apply a 50%
    weighting to the estimated enterprise value determined under
    both the market approach and the income approach, and then to
    increase the result by the amount of our cash on hand and the
    anticipated cash and tax benefits from option and warrant
    exercises. The value determined by the market approach on
    January&#160;17,
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    50
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    2009 was lower than the value determined on October&#160;3,
    2008, because we decreased the net services revenue multiple
    from 3.40 to 2.79 to reflect further declines in market prices
    of the comparable companies and our revenues decreased slightly
    in the third quarter of 2008 as compared to the second quarter
    of 2008. For the income approach, we used the same discount rate
    and methodology as in the October&#160;3, 2008 valuation, except
    that we discounted the projected cash flows and terminal value
    for three fewer months. The percentage allocation of our
    estimated enterprise value to senior securities and common stock
    was unchanged from the prior valuation.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>May&#160;19, 2009 Fair Value
    Determination.</I></B>&#160;&#160;On May&#160;19, 2009, our
    board of directors determined that the fair value of our
    non-voting common stock was $50.89 per share. For the income
    approach, we developed new forecasts of our cash flows over a
    ten-year period rather than a five-year period. We based our
    projections for the first five years of this period based on our
    actual operating results for 2008 and our expected operating
    results for the years 2009 through 2013, and we assumed for the
    next five years of this period that we had made an orderly
    transition from a high-growth company to a mature growth
    company. To reflect that we were entering into a different stage
    of development, we decreased the discount rate applied to future
    expected cash flows from 25% to 18%. To estimate the terminal
    value in the tenth year we assumed a 5% long-term growth rate
    after the tenth year and used the Gordon growth model, which is
    a mathematical simplification of an earnings stream that is
    expected to grow at a constant rate. For the market approach, we
    used a similar group of six companies. In order to reduce the
    influence of outliers, however, the net services revenue
    multiple for the companies with the highest and lowest figures
    were weighted 10% each and the net services revenue multiple for
    the other four companies were weighted 20% each. The estimated
    enterprise value calculated under the income approach was
    weighted 67% and the estimated enterprise value calculated under
    the market approach was weighted 33%. The result was then
    increased by the present value of the cash that we expected
    would be realized if all options and warrants were exercised
    plus the present value of the associated tax savings we would
    achieve. We continued to allocated the adjusted enterprise value
    to our securities with rights and preferences that are superior
    to our common stock, as in prior valuations, and continued to
    discount the remaining value by 10% to reflect the fact that our
    stockholders could not freely trade our common stock in the
    public markets. We also applied an additional discount of 2% to
    the fair value of the voting common stock in order to determine
    the fair value of the non-voting common stock.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Legal
    Proceedings</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In the normal course of business, we are involved in legal
    proceedings or regulatory investigations. We evaluate the need
    for loss accruals using the requirements of Statement of
    Financial Accounting Standards No.&#160;5, <I>Accounting for
    Contingencies</I>. When conducting this evaluation we consider
    factors such as the probability of an unfavorable outcome and
    the ability to make a reasonable estimate of the amount of loss.
    We record an estimated loss for any claim, lawsuit,
    investigation or proceeding when it is probable that a liability
    has been incurred and the amount of the loss can reasonably be
    estimated. If the reasonable estimate of a probable loss is a
    range, and no amount within the range is a better estimate, then
    we record the minimum amount in the range as our loss accrual.
    If a loss is not probable or a probable loss cannot be
    reasonably estimated, no liability is recorded.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Results of
    Operations</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In evaluating our business performance, management monitors
    numerous quantitative and qualitative factors. The primary
    financial metrics we monitor are base fee revenues, incentive
    fee revenues, reductions in revenue cycle operating costs (both
    in absolute dollars and as a percentage of base fees), corporate
    level operating expenses, cash flow and adjusted EBITDA. We also
    monitor the
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    51
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    amount of net patient revenue under our management. The
    principal non-financial metrics we monitor are:
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Value&#160;&#151; </I>the results we are producing for our
    customers by major value lever;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>People&#160;&#151; </I>our ability to attract, hire and
    retain a sufficient number of talented employees to staff our
    growing business;&#160;and
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Technology&#160;&#151; </I>the development and performance of
    our proprietary technology.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth consolidated operating results
    and other operating data for the periods indicated.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="41%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Fiscal Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2006</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2009</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" nowrap align="center" valign="bottom">
    <B>(In thousands, except other operating data as indicated)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Statement of Operations Data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net services revenue
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    160,741
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    240,725
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    398,469
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    187,261
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    238,149
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Costs of services
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    141,767
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    197,676
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    335,211
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    160,082
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    195,667
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating margin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,974
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43,049
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    63,258
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,179
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42,482
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Infused management and technology expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,875
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,872
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,234
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,938
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24,482
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Selling, general and administrative expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,777
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,657
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21,227
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,642
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,308
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,652
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43,529
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,461
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,580
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,790
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Income (loss) from operations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (8,678
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (480
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,797
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (401
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,692
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,359
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,710
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    710
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    433
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    83
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Income (loss) before provision for (benefit from) income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,230
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,507
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,775
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Provision for (benefit from) income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    456
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,264
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    626
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,439
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net income (loss)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    774
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,243
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (594
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,214
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Operating Expense Details:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Infused management and technology expense, excluding
    depreciation and amortization expense and share-based
    compensation expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17,952
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    26,375
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    35,079
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    16,626
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    21,411
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Selling, general and administrative expense, excluding
    depreciation and amortization expense and share-based
    compensation expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,230
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,760
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,879
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,629
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,746
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Depreciation and amortization expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    626
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,307
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,540
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    920
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,882
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Share-based compensation expense(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    844
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,087
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,963
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,405
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,751
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    27,652
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    43,529
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    60,461
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    27,580
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    39,790
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Other Operating Data (unaudited):</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net patient revenue under management (at period end) (in
    billions)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6.9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    9.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    8.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    11.9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Share-based compensation expense includes share-based
    compensation expense and warrant-related expense, exclusive of
    warrant expense of $83, $928, $921, $696 and $1,334 which was
    classified as a reduction in base fee revenue for the years
    ended December&#160;31, 2006, 2007 and 2008 and the six months
    ended June&#160;30, 2008 and 2009, respectively.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    52
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Six Months
    Ended June&#160;30, 2008 Compared to Six Months Ended
    June&#160;30, 2009</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Net Services
    Revenue</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table summarizes the composition of our net
    services revenue for the six months ended June&#160;30, 2008 and
    2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="59%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="16%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="16%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Six Months<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Six Months<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Ended June&#160;30,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Ended June&#160;30,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2009</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net base fees for managed service contracts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    167,085
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    205,017
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Incentive payments for managed service contracts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,483
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,018
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other services
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,693
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,114
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    187,261
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    238,149
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Net services revenue increased $50.8&#160;million, or 27.2%, to
    $238.1&#160;million for the six months ended June&#160;30, 2009
    from $187.3&#160;million for the six months ended June&#160;30,
    2008. The largest component of the increase, net base fee
    revenue, increased $37.9&#160;million, or 22.7%, to
    $205.0&#160;million for the six months ended June&#160;30, 2009
    from $167.1&#160;million for the six months ended June&#160;30,
    2008, primarily due to an increase in the number of hospitals
    with whom we had managed service contracts from 43 as of
    June&#160;30, 2008 to 53 as of June&#160;30, 2009. Of the
    $37.9&#160;million increase in net base fee revenues,
    $33.0&#160;million was attributable to new managed service
    contracts entered into during the six months ended June&#160;30,
    2009. In addition, incentive payment revenues increased by 63.9%
    to $27.0&#160;million for the six months ended June&#160;30,
    2009 from $16.5&#160;million for the six months ended
    June&#160;30, 2008, consistent with the increases that generally
    occur as our managed service contracts mature. All other
    revenues increased by $2.4&#160;million to $6.1&#160;million for
    the six months ended June&#160;30, 2009 from $3.7&#160;million
    for the six months ended June&#160;30, 2008, as we increased the
    number of customers using our dormant patient accounts
    receivable collection services and continued to expand our
    specialized services such as emergency room physician advisory
    services. Net patient revenue under our management increased by
    40.0% to $11.9&#160;billion for the six months ended
    June&#160;30, 2009 from $8.5&#160;billion for the six months
    ended June&#160;30, 2008.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Costs of
    Services</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our costs of services increased $35.6&#160;million, or 22.2%, to
    $195.7&#160;million for the six months ended June&#160;30, 2009
    from $160.1&#160;million for the six months ended June&#160;30,
    2008. The increase in costs of services was primarily
    attributable to the increase in the number of hospitals for
    which we provide managed services.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Operating
    Margin</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Operating margin increased $15.3&#160;million, or 56.3%, to
    $42.5&#160;million for the six months ended June&#160;30, 2009
    from $27.2&#160;million for the six months ended June&#160;30,
    2008. The increase consisted primarily of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $10.5&#160;million in additional incentive payments under
    managed service contracts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an increase of $2.0&#160;million in services margin;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a reduction of $3.4&#160;million in revenue cycle operating
    costs under managed service contracts, net of customer cost
    sharing.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The above was partially offset by an increase of
    $0.6&#160;million in costs related to the issuance of warrants
    to Ascension Health during the six months ended June&#160;30,
    2009.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    53
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The increase in operating margin in absolute dollars was
    accompanied by an increase in operating margin as a percentage
    of net services revenue from 14.5% for the six months ended
    June&#160;30, 2008 to 17.8% for the six months ended
    June&#160;30, 2009.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Operating
    Expenses</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Infused management and technology expenses increased
    $6.5&#160;million, or 36.5%, to $24.5&#160;million for the six
    months ended June&#160;30, 2009 from $17.9&#160;million for the
    six month ended June&#160;30, 2008. The increase in infused
    management and technology expenses was primarily due to the
    increase in the number of our management personnel deployed at
    customer facilities, reflecting an increase in the number of
    hospitals with whom we had managed service contracts, as well as
    the items noted below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Selling, general and administrative expenses increased
    $5.7&#160;million, or 58.8%, to $15.3&#160;million for the six
    months ended June&#160;30, 2009 from $9.6&#160;million for the
    six months ended June&#160;30, 2008. The increase included
    $1.7&#160;million of costs, or 29.9% of the increase, for
    enhancing our accounting systems, documenting internal controls,
    establishing an internal audit function and other costs
    associated with our preparation to be a public company. The
    increase also included additional research and development costs
    of $1.5&#160;million, or 26.3% of the increase, to develop our
    new cost and quality initiative. The increase also included
    $1.5&#160;million, or 26.3%, related to additional depreciation,
    amortization and share-based compensation expenses, as discussed
    below. The remaining increase of $1.0&#160;million, or 17.5%,
    was primarily due to increases in our personnel costs to support
    our expanding customer base.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We allocate our operating expenses between the infused
    management expenses and selling, general and administrative
    expenses. During the six months ended June&#160;30, 2009, the
    following changes affected both categories:
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Share-based compensation expense increased to $5.8&#160;million
    for the six months ended June&#160;30, 2009 from
    $3.4&#160;million for the six months ended June&#160;30, 2008
    due to employee option grants and vesting of previously granted
    stock options.
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Depreciation expense increased $0.3&#160;million, or 50.0%, to
    $0.9&#160;million for the six months ended June&#160;30, 2009
    from $0.6&#160;million for the six months ended June&#160;30,
    2008, due to the addition of computer equipment, furniture and
    fixtures, and other property to support our growing operations.
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Amortization expense increased $0.6&#160;million, or 200.0%, to
    $0.9&#160;million for the six months ended June&#160;30, 2009
    from $0.3&#160;million for the six months ended June&#160;30,
    2008. The majority of this increase resulted from amortization
    of internally developed software.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Operating
    Income (Loss)</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Operating income increased $3.1&#160;million to
    $2.7&#160;million for the six months ended June&#160;30, 2009
    from an operating loss of $0.4&#160;million for the six months
    ended June&#160;30, 2008. The increase in operating income was
    primarily due to net services revenue growing at a higher rate
    than operating expenses as a result of operating efficiencies.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Income
    Taxes</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The tax benefit of $2.4&#160;million for the six months ended
    June&#160;30, 2009 reflected the reduction of the valuation
    allowance related to deferred tax assets of $3.5&#160;million,
    net of a provision for income taxes in the period.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Net
    Income</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Net income increased $5.8&#160;million to $5.2&#160;million for
    the six months ended June&#160;30, 2009 from a net loss of
    $0.6&#160;million for the six months ended June&#160;30, 2008.
    The increase in net income was primarily due to the increase in
    operating income, offset by a decrease of $0.4&#160;million in
    interest income.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    54
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Year Ended
    December&#160;31, 2007 Compared to Year Ended December&#160;31,
    2008</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Net Services
    Revenue</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table summarizes the composition of our net
    services revenue for the years ended December&#160;31, 2007 and
    2008:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="75%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net base fees for managed service contracts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    212,086
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    350,085
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Incentive payments for managed service contracts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,491
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38,971
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other services
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,148
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,413
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    240,725
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    398,469
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Net services revenue increased $157.8&#160;million, or 65.5%, to
    $398.5&#160;million for the year ended December&#160;31, 2008
    from $240.7&#160;million for the year ended December&#160;31,
    2007. The largest component of the increase, net base fee
    revenue, increased $138.0&#160;million, or 65.1%, to
    $350.1&#160;million for the year ended December&#160;31, 2008
    from $212.1&#160;million for the year ended December&#160;31,
    2007, primarily due to an increase in the number of hospitals
    with whom we had managed service contracts from 36 as of
    December&#160;31, 2007 to 47 as of December&#160;31, 2008. Of
    the $138.0&#160;million increase in net base fee revenues,
    $113.4&#160;million was attributable to new managed service
    contracts entered into during 2008. In addition, incentive
    payment revenues increased to $39.0&#160;million for the year
    ended December&#160;31, 2008 from $25.5&#160;million for the
    year ended December&#160;31, 2007. All other revenues increased
    by $6.3&#160;million to $9.4&#160;million for the year ended
    December&#160;31, 2008 from $3.1&#160;million for the year ended
    December&#160;31, 2007, as we increased the number of customers
    using our dormant patient accounts receivable collection
    services and we began rolling out specialized services such as
    emergency room physician advisory services. Net patient revenue
    under our management increased by 31.9% to $9.1&#160;billion for
    the year ended December&#160;31, 2008 from $6.9&#160;billion for
    the year ended December&#160;31, 2007.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Costs of
    Services</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our costs of services increased $137.5&#160;million, or 69.6%,
    to $335.2&#160;million for the year ended December&#160;31, 2008
    from $197.7&#160;million for the year ended December&#160;31,
    2007. The increase in costs of services was primarily
    attributable to the increase in the number of hospitals for
    which we provide managed services.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Operating
    Margin</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Operating margin increased $20.2&#160;million, or 46.9%, to
    $63.3&#160;million for the year ended December&#160;31, 2008
    from $43.0&#160;million for the year ended December&#160;31,
    2007. The increase consisted primarily of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $13.5&#160;million in additional incentive payments under
    managed service contracts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an increase of $3.2&#160;million in services margin; and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a reduction of $3.5&#160;million in revenue cycle operating
    costs under managed service contracts, net of customer cost
    sharing.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Operating margin as a percentage of net services revenue
    decreased in the year ended December&#160;31, 2008 because, as a
    result of our significant growth during 2008, there was a higher
    proportion of managed service contracts in their initial
    contract year&#160;&#151; when improvements in net services
    revenue and reductions in revenue cycle operating costs are
    generally lower&#160;&#151; during 2008 than during 2007.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    55
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Operating margin as a percentage of net services revenue
    decreased from 17.9% in the year ended December&#160;31, 2007 to
    15.9% in the year ended December&#160;31, 2008.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Operating
    Expenses</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Infused management and technology expenses increased
    $11.4&#160;million, or 40.8%, to $39.2&#160;million for the year
    ended December&#160;31, 2008 from $27.9&#160;million for the
    year ended December&#160;31, 2007. The increase in infused
    management and technology expenses was primarily due to the
    increase in the number of our management personnel deployed at
    customer facilities, reflecting an increase in the number of
    hospitals with whom we had managed service contracts, as well as
    the items noted below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Selling, general and administrative expenses increased
    $5.6&#160;million, or 35.6%, to $21.2&#160;million for the year
    ended December&#160;31, 2008 from $15.7&#160;million for the
    year ended December&#160;31, 2007. Of the increase,
    $6.1&#160;million was due to increases in our personnel costs
    necessary to support our expanding customer base. This was
    offset by a $1.7&#160;million decrease in share-based
    compensation expense associated with stock warrants granted for
    assistance in obtaining new hospital customers. The remaining
    $1.2&#160;million of the increase related to depreciation,
    amortization and share-based compensation expenses, as discussed
    below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We allocate our operating expenses between the infused
    management expenses and selling, general and administrative
    expenses. During the year ended December&#160;31, 2008, the
    following changes affected both categories:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Share-based compensation expense increased to $6.0&#160;million
    for the year ended December&#160;31, 2008 from $5.1&#160;million
    for the year ended December&#160;31, 2007, due to employee
    option grants and vesting of previously granted stock options.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Depreciation expense increased $0.5&#160;million, or 100%, to
    $1.0&#160;million for the year ended December&#160;31, 2008 from
    $0.5&#160;million for the year ended December&#160;31, 2007, due
    to the addition of computer equipment, furniture and fixtures
    and other property to support our growing operations.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Amortization expense increased $0.7&#160;million, or 87.5%, to
    $1.5&#160;million for the year ended December&#160;31, 2008 from
    $0.8&#160;million for the year ended December&#160;31, 2007. Of
    this increase, $0.5&#160;million related to the amortization of
    internally developed software, $0.1&#160;million related to the
    write-off of the value assigned to relationships with customers
    acquired as a result of our SureDecisions acquisition that did
    not enter into managed service contracts with us, and
    $0.1&#160;million related to recurring amortization of other
    intangible assets.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Operating
    Income (Loss)</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Operating income increased $3.3&#160;million to
    $2.8&#160;million for the year ended December&#160;31, 2008 from
    an operating loss of $0.5&#160;million for the year ended
    December&#160;31, 2007. The increase in operating income was
    primarily due to net services revenue growing at a higher rate
    than operating expenses as a result of operating efficiencies.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Income
    Taxes</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We conduct a large portion of our operations in Michigan. In
    2008, Michigan began to impose a tax based on gross receipts in
    addition to tax based on net income. For the year ended
    December&#160;31, 2008, we recorded a tax provision of
    $2.3&#160;million, of which $1.2&#160;million was attributable
    to the Michigan gross receipts tax. As a result, our total tax
    provision was equal to 65% of pre-tax income for the year ended
    December&#160;31, 2008, compared to 37% of pre-tax income for
    the year ended December&#160;31, 2007.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    56
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Net
    Income</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Net income increased $0.5&#160;million, or 60.6%, to
    $1.2&#160;million for the year ended December&#160;31, 2008 from
    $0.8&#160;million for the year ended December&#160;31, 2007. The
    increase in net income was primarily due to the increase in
    operating income.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Year Ended
    December&#160;31, 2006 Compared to Year Ended December&#160;31,
    2007</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Net Services
    Revenue</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table summarizes the composition of our net
    services revenue for the years ended December&#160;31, 2006 and
    2007:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="75%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2006</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net base fees for managed service contracts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    149,529
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    212,086
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Incentive payments for managed service contracts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,784
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,491
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other services
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,428
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,148
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    160,741
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    240,725
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Net services revenue increased $80.0&#160;million, or 49.8%, to
    $240.7&#160;million for the year ended December&#160;31, 2007
    from $160.7&#160;million for the year ended December&#160;31,
    2006. The largest component of the increase, net base fee
    revenue, increased $62.6&#160;million, or 41.8%, to
    $212.1&#160;million for the year ended December&#160;31, 2007
    from $149.5&#160;million for the year ended December&#160;31,
    2006, primarily due to an increase in the number of hospitals
    with whom we had managed service contracts from 21 as of
    December&#160;31, 2006 to 36 as of December&#160;31, 2007. Of
    the $62.6&#160;million increase in net base fee revenues,
    $40.9&#160;million was attributable to new managed service
    contracts entered into during 2007. In addition, incentive
    payment revenues increased to $25.5&#160;million for the year
    ended December&#160;31, 2007 from $9.8&#160;million for the year
    ended December&#160;31, 2006. All other revenues increased
    $1.7&#160;million, or 120.4%, to $3.1&#160;million for the year
    ended December&#160;31, 2007 from $1.4&#160;million for the year
    ended December&#160;31, 2006, primarily due to an increase in
    the number of customers using our dormant patient accounts
    receivable collection services. Net patient revenue under our
    management increased by 68.3% to $6.9&#160;billion for the year
    ended December&#160;31, 2007 from $4.1&#160;billion for the year
    ended December&#160;31, 2006.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Costs of
    Services</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our costs of services increased $55.9&#160;million, or 39.4%, to
    $197.7&#160;million for the year ended December&#160;31, 2007
    from $141.8&#160;million for the year ended December&#160;31,
    2006. The increase in costs of services was primarily
    attributable to the increase in the number of hospitals for
    which we provide managed services.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Operating
    Margin</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Operating margin increased $24.1&#160;million, or 126.9%, to
    $43.0&#160;million for the year ended December&#160;31, 2007
    from $19.0&#160;million for the year ended December&#160;31,
    2006. The increase consisted primarily of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $15.7&#160;million in additional incentive payments under
    managed service contracts;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a reduction of $8.9&#160;million in revenue cycle operating
    costs under managed service contracts, net of customer cost
    sharing.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The above increases were partially offset by an increase of
    $0.8&#160;million in costs related to the issuance of warrants
    to Ascension Health during the year ended December&#160;31, 2007.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    57
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In total, operating margin as a percentage of net services
    revenue increased from 11.8% in the year ended December&#160;31,
    2006 to 17.9% in the year ended December&#160;31, 2007,
    primarily due to an increased ratio of mature managed service
    contracts to new managed service contracts.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Operating
    Expenses</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Infused management and technology expenses increased
    $9.0&#160;million, or 47.7%, to $27.9&#160;million for the year
    ended December&#160;31, 2007 from $18.9&#160;million for the
    year ended December&#160;31, 2006. The increase in infused
    management and technology expenses was primarily due to the
    increase in the number of our management personnel deployed at
    customer facilities, reflecting an increase in the number of
    hospitals with whom we had managed service contracts.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Selling, general and administrative expenses increased
    $6.9&#160;million, or 78.4%, to $15.7&#160;million for the year
    ended December&#160;31, 2007 from $8.8&#160;million for the year
    ended December&#160;31, 2006. Grants of stock warrants to
    Ascension Health and option grants accounted for
    $4.2&#160;million of the increase, as noted below. The remaining
    $2.7&#160;million of increase related to the increase in our
    personnel costs to support our expanding customer base.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We allocate our operating expenses between the infused
    management expenses and selling, general and administrative
    expenses. During the year ended December&#160;31, 2007, the
    following changes affected both categories:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Share-based compensation expense increased by $4.2&#160;million
    for the year ended December&#160;31, 2007 from $0.8&#160;million
    for the year ended December&#160;31, 2006, of which
    $4.1&#160;million was due to grants of stock warrants to
    Ascension Health and the balance was attributable to increases
    in the costs associated with employee option grants and the
    vesting of previously granted stock options.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Depreciation expense increased $0.2&#160;million, or 66.7%, to
    $0.5&#160;million for the year ended December&#160;31, 2007 from
    $0.3&#160;million for the year ended December&#160;31, 2006, due
    to the addition of computer equipment, furniture and fixtures,
    and other property to support our growing operations.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Amortization expense increased $0.5&#160;million, or 166.7%, to
    $0.8&#160;million for the year ended December&#160;31, 2007 from
    $0.3&#160;million for the year ended December&#160;31, 2006, due
    to the amortization of internally developed software.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Operating
    Loss</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Operating loss decreased $8.2&#160;million, or 94.5%, to
    $0.5&#160;million for the year ended December&#160;31, 2007 from
    $8.7&#160;million for the year ended December&#160;31, 2006. The
    decrease in operating loss was primarily due to net services
    revenue growing at a higher rate than costs of services and
    operating expenses as a result of operating efficiencies.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Income
    Taxes</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In 2007, we had net taxable income and began recording a tax
    provision equal to 37% of pre-tax income.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Net
    Income</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We had net income of $0.8&#160;million for the year ended
    December&#160;31, 2007 compared to a net loss of
    $7.3&#160;million for the year ended December&#160;31, 2006. The
    increase in net income was primarily due to the decrease in
    operating losses combined with a $0.4&#160;million increase in
    interest income due to an increase in cash investments.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    58
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Selected
    Quarterly Financial Data</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth selected unaudited consolidated
    quarterly operating data for each of the ten quarters during the
    period from January&#160;1, 2007 to June&#160;30, 2009. In our
    management&#146;s opinion, the data have been prepared on the
    same basis as the audited consolidated financial statements
    included in this prospectus and reflect all necessary
    adjustments, consisting only of normal recurring adjustments,
    necessary for a fair presentation of these data. You should read
    this information together with our consolidated financial
    statements and the related notes appearing elsewhere in this
    prospectus. Operating results for any fiscal quarter are not
    necessarily indicative of results for the full year. Historical
    results are not necessarily indicative of the results to be
    expected in future periods.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 7pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="24%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=08 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=08 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=08 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=08 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=09 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=09 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=09 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=09 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=10 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=10 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=10 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=10 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=11 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=11 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=11 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=11 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="38" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Three Months Ended</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Mar.&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>June&#160;30,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Sept.&#160;30,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Dec.&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Mar.&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>June&#160;30,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Sept.&#160;30,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Dec.&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Mar.&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>June&#160;30,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2007</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2007</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2007</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2007</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2009</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2009</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="38" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Net services revenue
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    49,699
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    56,795
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    64,611
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    69,620
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    86,357
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    100,904
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    105,956
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    105,252
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    112,467
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    125,682
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Costs of services
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    44,431
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46,688
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50,765
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    55,792
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    73,433
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    86,649
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    87,624
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    87,505
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92,703
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    102,964
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Operating margin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,268
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,107
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,846
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,828
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,924
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14,255
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,332
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,747
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19,764
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22,718
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Infused management and technology expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,882
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,608
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,822
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,560
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,452
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,486
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,795
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,501
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,175
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,307
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Selling, general and administrative expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,478
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,564
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,139
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,476
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,696
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,946
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,020
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,565
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,816
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,492
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Income (loss) from operations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3,092
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    935
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,885
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,208
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,224
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    823
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,517
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (227
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,919
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Interest income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    457
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    393
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    383
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    477
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    264
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    169
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    251
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    44
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Net income (loss) before provision for (benefit from) income
    taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,635
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,328
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,268
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,731
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (960
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    992
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,768
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (293
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (183
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,958
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Provision for (benefit from) income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (977
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    492
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,583
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (642
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    600
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,414
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    224
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    454
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,893
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Net income (loss)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (1,658
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    836
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,685
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (1,089
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (986
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    392
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,354
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (517
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (637
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,851
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our quarterly and annual net services revenue generally
    increased each period due to ongoing expansion in the number of
    hospitals subject to managed service contracts with us and
    increases in the amount of incentive payments earned. The timing
    of customer additions is not uniform throughout the year,
    however. We did not add any new customers in the quarter ended
    December&#160;31, 2008 and as a result our net services revenue
    were essentially unchanged from the prior quarter. We experience
    seasonal fluctuations in incentive payments as a result of
    variations in the number of days in certain months and patient
    deferral of elective procedures during the year-end holiday
    period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our costs of services generally increased each period due to
    increases in the number of revenue cycle staff persons under our
    management at customer sites. Our operating expenses have
    increased as a result of our hiring of additional employees to
    provide
    <FONT style="white-space: nowrap">on-site</FONT>
    management of our customers&#146; revenue cycle operations and
    our ongoing efforts to develop and enhance the technology that
    allows us to improve our customers&#146; net revenue. Operating
    margins are slightly depressed in quarters in which we add new
    customers that have not yet fully implemented our cost-reduction
    programs. In addition, beginning in the second half of 2008, we
    began to incur additional expenses to build the infrastructure
    necessary to become a public company. The ongoing decline in
    interest income for the periods presented is due to the
    reduction in market interest rates. The tax benefit in the
    quarter ended June&#160;30, 2009 reflects the release of
    reserves for deferred tax assets of $3.6&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Selling, general and administrative expenses in the quarters
    ended December&#160;31, 2007, March&#160;31, 2008 and
    March&#160;31, 2009 included $4.1&#160;million,
    $2.4&#160;million and $2.7&#160;million, respectively, in
    share-based compensation expense associated with stock warrants
    granted for assistance in
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    59
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    obtaining new hospital customers. Primarily as a result of these
    expenses, we incurred net losses in the quarters ended
    December&#160;31, 2007 and March&#160;31, 2008. We incurred a
    net loss in the quarter ended March&#160;31, 2007 primarily due
    to the immaturity of our managed service contract portfolio and
    variations in the timing of quarterly incentive payments.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Liquidity and
    Capital Resources</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our primary source of liquidity is cash flows from operations.
    Given our current cash and cash equivalents, short-term
    investments and accounts receivable, we believe that we will
    have sufficient liquidity to fund our business and meet our
    contractual obligations for at least 12&#160;months following
    the closing of this offering. We expect that the combination of
    our current liquidity and expected additional cash generated
    from operations will be sufficient for our planned capital
    expenditures, which are expected to consist primarily of
    capitalized software, and other investing activities, in the
    next 12&#160;months.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our cash and cash equivalents, consisting of demand deposits,
    increased $17.0&#160;million, from $34.7&#160;million at
    December&#160;31, 2007 to $51.7&#160;million at
    December&#160;31, 2008, primarily due to cash generated by the
    growth in our business. Cash and cash equivalents decreased
    $13.9&#160;million, from $51.7&#160;million at December&#160;31,
    2008 to $37.8&#160;million at June&#160;30, 2009, primarily due
    to the changes in accounts receivable and prepaid assets
    discussed below.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Operating
    Activities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Cash flows used by operating activities totaled
    $11.7&#160;million for the six months ended June&#160;30, 2009
    and cash flows generated by operating activities totaled
    $9.9&#160;million for the six months ended June&#160;30, 2008.
    Receivables from customers increased by $20.7&#160;million
    during the six months ended June&#160;30, 2009 and decreased by
    $0.9&#160;million during the six months ended June&#160;30,
    2008, primarily due to increased net services revenue and the
    timing of customer payments. Prepaid assets increased by
    $7.2&#160;million during the six months ended June&#160;30, 2009
    due to a prepayment of 2009 estimated federal income taxes.
    Payables increased by $12.7&#160;million for the six months
    ended June&#160;30, 2009 and by $10.6&#160;million for the six
    months ended June&#160;30, 2008. The change in payables was
    primarily due to timing of our payments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Cash flows generated by operating activities totaled
    $39.5&#160;million for the year ended December&#160;31, 2008,
    $11.8&#160;million for the year ended December&#160;31, 2007 and
    $6.0&#160;million for the year ended December&#160;31, 2006. The
    increases in cash provided by operations for the years ended
    December&#160;31, 2007 and 2008 was primarily attributable to
    higher net services revenue and improved financial results due
    to growth in our business. Receivables from customers increased
    by $4.3&#160;million during the year ended December&#160;31,
    2008 and by $15.1&#160;million during the year ended
    December&#160;31, 2007, in each case primarily due to increased
    net services revenue. Payables increased by $16.1&#160;million
    during the year ended December&#160;31, 2008 and by
    $8.3&#160;million during the year ended December&#160;31, 2007,
    and deferred revenue increased by $10.3&#160;million during the
    year ended December&#160;31, 2008 and by $6.6&#160;million
    during the year ended December&#160;31, 2007. The increases in
    payables and deferred revenue were primarily due to growth in
    our business.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Investing
    Activities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Cash used in investing activities was $2.4&#160;million for the
    six months ended June&#160;30, 2009 and $2.3&#160;million for
    the six months ended June&#160;30, 2008. Use of cash in these
    periods primarily related to the purchase of furniture and
    fixtures, computer hardware and software to support the growth
    of our business.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Cash flows used in investing activities was $6.1&#160;million
    for the year ended December&#160;31, 2008, $3.3&#160;million for
    the year ended December&#160;31, 2007 and $4.7&#160;million for
    the year ended December&#160;31, 2006. For all three years, use
    of cash primarily related to our purchase of furniture,
    fixtures, computer
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    60
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    hardware, software and other property to support the growth of
    our business. In addition, we used $1.4&#160;million in cash to
    acquire SureDecisions in May 2006.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Financing
    Activities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Cash provided by financing activities was $0.2&#160;million for
    the six months ended June&#160;30, 2009 and cash used by
    financing activities was $0.4&#160;million for the six months
    ended June&#160;30, 2008. The increase from the six months ended
    June&#160;30, 2008 to the six months ended June&#160;30, 2009
    was primarily attributable to the repayment of non-executive
    employee promissory notes related to stock option exercises.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Cash used by financing activities was $16.3&#160;million for the
    year ended December&#160;31, 2008, primarily due to our payment
    of $15.0&#160;million of dividends and our repurchase of common
    stock for $1.5&#160;million, partially offset by
    $0.2&#160;million of proceeds from exercises of stock options.
    In June 2008, our board of directors approved a special dividend
    on all outstanding shares of common stock and preferred stock in
    the amount of $0.7203 per common-equivalent share, for an
    aggregate dividend of $15.0&#160;million. The dividend was
    declared to provide an initial return on the investment of the
    company&#146;s private investors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Cash provided by financing activities was $5.4&#160;million for
    the year ended December&#160;31, 2007. This represented
    $5.5&#160;million of proceeds from our sale of
    669,284&#160;shares of common stock to Ascension Health and an
    additional $0.6&#160;million of proceeds from exercises of stock
    option, partially offset by our repurchases of common stock for
    $0.7&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Cash provided by financing activities was $2.0&#160;million for
    the year ended December&#160;31, 2006, reflecting
    $2.4&#160;million of proceeds from exercises of stock options,
    partially offset by $0.4&#160;million of loans we made to
    employees to facilitate their option exercises.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Future Capital
    Needs</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We intend to fund our future growth over the next 12&#160;months
    with funds generated from operations and our net proceeds from
    this offering. Over the longer term, we expect that cash flows
    from operations, supplemented by short-term and long-term
    financing, as necessary, will be adequate to fund our day-to-day
    operations and capital expenditure requirements. Our ability to
    secure short-term and long-term financing in the future will
    depend on several factors, including our future profitability,
    the quality of our accounts receivable, our relative levels of
    debt and equity, and the overall condition of the credit markets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We are in the process of negotiating a $15&#160;million
    revolving line of credit for working capital and general
    corporate purposes. If we enter into this credit facility, we
    anticipate that borrowings would be secured by substantially all
    of our assets and a cash deposit account and would be subject to
    a borrowing base. We expect the credit facility to have an
    initial term of two years, to be renewable annually and to have
    other terms and conditions customary for lines of credit of this
    type with similar companies.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Contractual
    Obligations</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table presents our obligations and commitments to
    make future payments under contracts, such as lease agreements,
    and under contingent commitments as of December&#160;31, 2008:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="44%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>2013 and<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2009</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2010</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2011</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2012</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">beyond</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Total</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Minimum lease payments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,218
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    824
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    758
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    329
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    792
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,921
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,218
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    824
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    758
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    329
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    792
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,921
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    61
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<P><HR noshade><P>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We rent office space and equipment under a series of operating
    leases, primarily for our Chicago corporate office and India
    operations. Lease payments are amortized to expense on a
    straight-line basis over the lease term. As of December&#160;31,
    2008, the Chicago corporate office consisted of approximately
    28,000&#160;square feet in a multi-story office building. We
    have an option to cancel the lease effective November&#160;30,
    2011 if the landlord is unable, prior to December&#160;31, 2010,
    to provide approximately 22,000&#160;square feet of additional
    office space on an adjacent floor. If the landlord provides this
    additional office space and we do not concurrently exercise our
    option to return approximately 6,500&#160;square feet of office
    space on a non-adjacent floor, the lease for all
    50,000&#160;feet will be extended until ten years and
    90&#160;days after the date we take possession of the additional
    22,000&#160;square feet of office space, and our minimum lease
    payments will increase by approximately $550,000 per year. See
    &#147;Business&#160;&#151; Facilities&#148; for additional
    information regarding our office leases.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Pursuant to the master services agreement between us and
    Ascension Health and our individual agreements with hospitals
    affiliated with Ascension Health that contract for our services,
    our fees are subject to adjustment in the event specified
    performance milestones are not met, which could result in a
    reduction in future fees payable to us by such hospitals but
    would not obligate us to refund any payments. These potential
    reductions in future fees are not reflected in the above table
    because the amounts cannot be quantified and because, based on
    our experience to date, we do not anticipate that there will be
    any permanent reduction in future fees under these provisions.
    For additional information regarding these contract provisions,
    see &#147;Related Person Transactions&#160;&#151; Transactions
    With Ascension Health&#148;.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Off-Balance Sheet
    Arrangements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We have not entered into any off-balance sheet arrangements.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Recent Accounting
    Pronouncements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In December 2007, the Financial Accounting Standards Board , or
    FASB, issued Statement of Financial Accounting Standards, or
    SFAS, No.&#160;141(R), <I>Business Combinations</I>.
    SFAS&#160;No.&#160;141(R) requires us to continue to follow the
    guidance in SFAS&#160;No.&#160;141 for certain aspects of
    business combinations, with additional guidance provided
    defining the acquirer, recognizing and measuring the
    identifiable assets acquired, the liabilities assumed, any
    noncontrolling interest in the acquiree, assets and liabilities
    arising from contingencies, defining a bargain purchase, and
    recognizing and measuring goodwill or a gain from a bargain
    purchase. In addition, under SFAS&#160;No.&#160;141(R),
    adjustments associated with changes in tax contingencies that
    occur after the measurement period, not to exceed one year, are
    recorded as adjustments to income. This statement is effective
    for all business combinations for which the acquisition date is
    on or after the beginning of an entity&#146;s first fiscal year
    that begins after December&#160;15, 2008; however, the guidance
    in this standard regarding the treatment of income tax
    contingencies is retroactive to business combinations completed
    prior to January&#160;1, 2009. We adopted
    SFAS&#160;No.&#160;141(R) on January&#160;1, 2009. The adoption
    had no material impact on the Company&#146;s consolidated
    financial statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In April 2008, the FASB issued FASB Staff Position, or FSP,
    <FONT style="white-space: nowrap">SFAS&#160;142-3,</FONT>
    <I>&#147;Determination of the Useful Life of Intangible
    Assets</I>&#148;. This FSP amends the factors that should be
    considered in developing renewal or extension assumptions used
    to determine the useful life of a recognized intangible asset
    under SFAS&#160;No.&#160;142. The intent of this FSP is to
    improve the consistency between the useful life of a recognized
    intangible asset under SFAS&#160;No.&#160;142 and the period of
    expected cash flows used to measure the fair value of the asset
    under SFAS&#160;No.&#160;141R and other United States generally
    accepted accounting principles. This FSP is effective for
    financial statements issued for fiscal years beginning after
    December&#160;15, 2008, and interim periods within those fiscal
    years. The Company adopted this FSP January&#160;1, 2009. The
    adoption of this FSP did not have an impact on our consolidated
    financial statements.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    62
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In June 2008, the FASB issued FSP Emerging Issues Task Force, or
    EITF,
    <FONT style="white-space: nowrap">03-6-1,</FONT>
    &#147;<I>Determining Whether Instruments Granted in Share-Based
    Payment Transactions Are Participating Securities</I>&#148;. FSP
    <FONT style="white-space: nowrap">EITF&#160;03-6-1</FONT>
    addresses whether instruments granted in share-based payment
    transactions are participating securities prior to vesting and,
    therefore, need to be included in the earnings allocation in
    computing earnings per share under the two-class method. This
    FSP is effective for financial statements issued for fiscal
    years beginning after December&#160;15, 2008 and interim periods
    within those years. We adopted this FSP effective
    January&#160;1, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In April 2009, the FASB issued FSP
    <FONT style="white-space: nowrap">SFAS&#160;107-1</FONT>
    and Accounting Principles Board (APB)
    <FONT style="white-space: nowrap">28-1,</FONT>
    &#147;<I>Interim Disclosures about Fair Value of Financial
    Instruments</I>&#148;. This FSP, which amends
    SFAS&#160;No.&#160;107, &#147;<I>Disclosures about Fair Value of
    Financial Instruments</I>&#148;, requires publicly-traded
    companies, as defined in APB Opinion No.&#160;28,
    &#147;<I>Interim Financial Reporting</I>&#148;, to provide
    disclosures on the fair value of financial instruments in
    interim financial statements. Since FSP
    <FONT style="white-space: nowrap">SFAS&#160;107-1</FONT>
    requires only additional disclosures concerning the financial
    instruments, the adoption of FSP
    <FONT style="white-space: nowrap">SFAS&#160;107-1</FONT>
    effective June&#160;30, 2009, did not have a material impact on
    our condensed consolidated financial statements.
</DIV>

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    In May 2009, the FASB issued SFAS&#160;No.&#160;165,
    &#147;<I>Subsequent Events</I>&#148;, or SFAS&#160;165.
    SFAS&#160;No.&#160;165 establishes general standards of
    accounting for and disclosures of subsequent events that occur
    after the balance sheet date but prior to the issuance of
    financial statements. The statement requires additional
    disclosure regarding the date through which subsequent events
    have been evaluated by the entity as well as whether that date
    is the date the financial statements were issued. This statement
    became effective for our financial statements as of
    June&#160;30, 2009. We have evaluated its subsequent events
    after the balance sheet date of June&#160;30, 2009 through
    September&#160;24, 2009.
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In June 2009, FASB issued SFAS&#160;No.&#160;168, <I>&#147;The
    FASB Accounting Standards Codification and the Hierarchy of
    Generally Accepted Accounting Principles, a replacement of FASB
    Statement No.&#160;162 </I>, or SFAS&#160;No.&#160;168.
    SFAS&#160;No.&#160;168 identifies the sources of accounting
    principles and the framework for selecting the principles to be
    used in the preparation of financial statements that are
    presented in conformity with generally accepted accounting
    principles in the United States. SFAS&#160;No.&#160;168 is
    effective for financial statements issued for interim and annual
    periods ending after September&#160;15, 2009. We do not expect
    the adoption of SFAS&#160;No.&#160;168 to have a significant
    impact on our consolidated financial statements.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Qualitative and
    Quantitative Disclosures about Market Risk</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Interest Rate Sensitivity.</I></B>&#160;&#160;Our interest
    income is primarily generated from interest earned on operating
    cash accounts. Our exposure to market risks related to interest
    rates is insignificant. We do not enter into interest rate
    swaps, caps or collars or other hedging instruments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Foreign Currency Exchange Risk.</I></B>&#160;&#160;Our
    results of operations and cash flows are subject to fluctuations
    due to changes in the Indian rupee because a portion of our
    operating expenses are incurred by our subsidiary in India and
    are denominated in Indian rupees. However, we do not generate
    any revenues outside of the United States. For the year ended
    December&#160;31, 2008 and the six months ended June&#160;30,
    2009, 0.7% and 0.8%, respectively, of our expenses were
    denominated in Indian rupees. As a result, we believe that the
    risk of a significant impact on our operating income from
    foreign currency fluctuations is not substantial.
</DIV>

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<A name='112'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

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    <B><FONT style="font-family: Arial, Helvetica">BUSINESS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Overview</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accretive Health is a leading provider of healthcare revenue
    cycle management services. Our business purpose is to help
    U.S.&#160;hospitals, physicians and other healthcare providers
    manage their revenue cycle operations more efficiently. Our
    integrated, end-to-end technology and services offering, which
    we refer to as our solution, helps our customers realize
    sustainable improvements in their operating margins and improve
    the satisfaction of their patients, physicians and staff. We
    enable these improvements by helping our customers increase the
    portion of the maximum potential patient revenue they receive
    while reducing total revenue cycle costs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our customers typically are multi-hospital systems, including
    faith-based or community healthcare systems, academic medical
    centers and independent ambulatory clinics, and their affiliated
    physician practice groups. We seek to develop strategic,
    long-term relationships with our customers and focus on
    providers that we believe understand the value of our operating
    model and have demonstrated success in both clinical and
    operational outcomes. As of June&#160;30, 2009, we provided our
    integrated revenue cycle service offerings to 21 customers
    representing 53&#160;hospitals and $11.9&#160;billion in annual
    net patient revenue, as well as physicians&#146; billing
    organizations associated with several of these customers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Grounded in sophisticated analytics, our solution spans our
    customers&#146; entire revenue cycle, unlike competing services
    that address only a portion of the revenue cycle. We are not a
    traditional outsourcing company focused solely on one-time cost
    reductions. Through the implementation of our distinctive
    operating model that includes people, processes and technology,
    our customers can generate significant and sustainable revenue
    cycle improvements. Our service offerings are adaptable to
    evolution of the healthcare regulatory environment, technology
    standards and market trends, and require no up-front cash
    investment by our customers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    To implement our solution, we assume full responsibility for the
    management and cost of a customer&#146;s revenue cycle
    operations and supplement the customer&#146;s existing revenue
    cycle staff with seasoned Accretive Health personnel. We
    collaborate with our customers&#146; revenue cycle employees
    with the objective of educating and empowering them so that over
    time they can deliver improved results using our tools. Once
    implemented, our technology, processes and services are deeply
    embedded in a hospital&#146;s day-to-day operations, touching
    each key step of the revenue cycle. We and our customers share
    financial gains resulting from our solution, which directly
    aligns our objectives and interests with those of our customers.
    Both we and our customers benefit&#160;&#151; on a contractually
    agreed upon basis&#160;&#151; from net patient revenue increases
    and cost savings realized by the customers as a result of our
    services. We believe that, over time, this alignment of
    interests fosters greater innovation and incentivizes us to
    improve our customers&#146; revenue cycle operations.
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The revenue cycle operations of a typical hospital, physician or
    other healthcare provider often fail to capture and collect the
    total amounts owed to it from third-party payors and patients
    for medical services rendered, leading to significant bad debt
    write-offs, uncompensated care, payor denials and corresponding
    administrative write-offs, as well as lost revenue for missed
    charges. Fitch Ratings estimates that in 2008, uncompensated
    care (including bad debt write-offs, charity care and uninsured
    discounts) averaged 17% of net patient revenue at
    U.S.&#160;hospitals. We generally deliver operating margin
    improvements to our customers through a combination of
    improvements in collections, which we refer to as net revenue
    yield, charge capture and revenue cycle cost reductions. Our
    customers have historically achieved significant net revenue
    yield improvements within 18 to 24&#160;months of implementing
    our operating model, with customers subject to mature managed
    service contracts realizing 400 to 600&#160;basis points in
    yield improvements, typically in the third or fourth contract
    year. Improvements in charge capture and collections are
    typically attributable to reduced payor denials, identification
    of additional items that can be billed to payors based on the
    actual procedures performed, identification of insurance for a
    higher percentage of otherwise uninsured patients, and
</DIV>

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    improved collections of patient balances after insurance.
    Revenue cycle cost reductions are typically achieved through
    operating efficiencies, including streamlining work flow,
    automating processes, centralizing vendor activities and
    implementing other efficiencies. Specific sources of margin
    improvement vary among customers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We have developed and refined our solution based in part on
    information, processes and management experience garnered
    through working with many of the largest and most prestigious
    hospitals and healthcare systems in the United States. We seek
    to embed our technology, personnel, know-how and culture within
    each customer&#146;s revenue cycle activities with the
    expectation that we will serve as the customer&#146;s
    <FONT style="white-space: nowrap">on-site</FONT>
    operational manager beyond the managed service contract&#146;s
    initial term, which typically ranges from four to five years. To
    date, we have experienced a contract renewal rate of 100%
    (excluding exploratory new service offerings, a consensual
    termination following a change of control and a customer
    reorganization). Coupled with the long-term nature of our
    managed service contracts and the fixed nature of the base fees
    under each contract, our historical renewal experience provides
    a core source of recurring revenue.
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our net services revenue consist primarily of base fees and
    incentive fees. We receive base fees for managing our
    customers&#146; revenue cycle operations, net of any cost
    savings we share with those customers. Incentive fees represent
    our portion of the increase in our customers&#146; net patient
    revenue resulting from our services. We generate a portion of
    our operating margin as a result of the difference between the
    fixed base fees and the variable costs of the revenue cycles
    that we manage. Incentive fees are a smaller portion of overall
    revenue than base fees but generally contribute directly to
    operating margin, thus significantly impacting our
    profitability. We closely monitor each customer&#146;s revenue
    cycle performance through periodic operating reviews. A
    customer&#146;s net revenue improvements and cost savings
    generally increase over time as we deploy additional programs
    and as the programs we implement become more effective, which in
    turn provides visibility into our future revenue and
    profitability. In 2008, for example, approximately 80% of our
    net services revenue, and over 95% of our net income, was
    derived from customer contracts that were in place as of
    January&#160;1, 2008. In 2008, we had net services revenue of
    $398.5&#160;million, representing growth of 65.5% over 2007 and
    a compound annual growth rate of 53.0% since 2005. In addition,
    we were profitable for the years ended December&#160;31, 2007
    and 2008 and the six months ended June&#160;30, 2009, and our
    profitability increased in each of these periods.
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Market
    Opportunity</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We believe that current macroeconomic conditions will continue
    to impose financial pressure on healthcare providers and will
    increase the importance of managing their revenue cycles
    effectively and efficiently. The market opportunity for our
    services&#160;&#151; which we define as the total amount of net
    patient revenue collected annually by U.S.&#160;hospitals and
    physicians&#146; billing organizations&#160;&#151; exceeds
    $750&#160;billion, calculated as follows. There are more than
    2,200 acute care hospitals in the United States within our
    target market (with more than $250&#160;million in annual net
    patient revenue each, or part of larger hospital systems),
    representing a market opportunity of approximately
    $510&#160;billion in annual net patient revenue. In addition,
    there are more than 2,500 smaller hospitals (with less than
    $250&#160;million in annual net patient revenue each),
    representing a market opportunity of approximately
    $130&#160;billion in annual net patient revenue, and large
    physicians&#146; billing organizations (with at least 75
    physicians each), representing an additional market opportunity
    of approximately $115&#160;billion in annual net patient revenue.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    According to the Centers for Medicare and Medicaid Services of
    the U.S.&#160;Department of Health and Human Services,
    expenditures for hospitals and physician and clinical services
    are expected to increase between 2009 and 2018 at annual rates
    of approximately 6.4% and 5.4%, respectively. Population growth,
    longer life expectancy, the increasing prevalence of chronic
    illnesses (such as diabetes and obesity) and the
    over-utilization of certain healthcare services is expected to
    put increasing pressure on hospitals, physicians and other
    healthcare providers to operate more efficiently. American
    Hospital Association surveys indicate that approximately 43% of
    hospitals had a
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    negative operating margin during the first quarter of 2009 and
    approximately 77% of hospitals are reducing capital spending. As
    the scope of healthcare services expands and financial pressures
    mount, hospitals are demanding both greater effectiveness and
    improved efficiency in the management of their revenue cycle
    operations. We believe that efficient management of the revenue
    cycle and collection of the full amount of payments due for
    patient services are among the most critical challenges facing
    healthcare providers today.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We believe that the inability of healthcare providers to capture
    and collect the total amounts owed to them for patient services
    is caused by the following trends:
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

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    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Complexity of Revenue Cycle
    Management.</I></B>&#160;&#160;At most hospitals, there is a
    lack of standardization across operating practices, payor and
    patient payment methodologies, data management processes and
    billing systems. In general, after a patient receives healthcare
    services, the hospital must coordinate payment with two or more
    parties, including third-party insurance companies, federal and
    state government payors, private charities and individual
    payors. Hospitals also face a growing population of uninsured
    patients, whom healthcare providers have an ethical and legal
    obligation to treat.
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Lack of Integrated Systems and
    Processes.</I></B>&#160;&#160;Although interrelated, the
    individual steps in the revenue cycle continuum are not
    operationally integrated across revenue cycle departments at
    many hospitals. Multiple tasks and milestones must be completed
    properly by personnel in various departments before a hospital
    or physician can be reimbursed for patient services. It is often
    difficult for a single organization to acquire and coordinate
    all the knowledge and experience necessary to capture
    inefficiencies within the revenue cycle. Even if all steps are
    performed flawlessly, the time required to receive full payment
    for services creates long billing cycles. With frequent changes
    in the reimbursement rules imposed by third-party payors, the
    billing and collections cycle often is not timely and
    error-free, further lengthening the time before payment is
    actually received by the healthcare provider.
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Increasing Patient Financial Responsibility for Healthcare
    Services.</I></B>&#160;&#160;Hospitals are being forced to adapt
    to the need for direct-to-patient billing and collections
    capabilities as patients bear payment responsibility for an
    increasing portion of healthcare costs. Hospitals have
    traditionally focused on collecting payments from insurance
    companies and from state and federal payors, and typically are
    less familiar with the processes necessary to collect payments
    from patients at the point of service, including the use of
    alternative payment options. Patient billing is often confusing
    and payment instructions are often unclear. Moreover, hospitals
    generally do not utilize consumer segmentation techniques to
    formulate effective revenue collection approaches to patients.
    As a result, hospitals generally write-off a high percentage of
    patient-owed bills, resulting in increases in bad debt and
    uncompensated care.
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Outdated Systems and Insufficient Resources to Upgrade
    Them.</I></B>&#160;&#160;Many hospitals suffer from operating
    inefficiencies caused by outdated technology, increasingly
    complex billing requirements, a general lack of standardization
    of process and information flow, costly in-house services that
    could be more economically outsourced, and an increasingly
    stringent regulatory environment. Hospitals often lack the
    breadth and depth of data available to payors, and this lack of
    information may contribute to the filing of less accurate claims
    with third-party insurance payors and unfavorable resolutions of
    disputed claims. In addition, the endowments of most hospitals
    have significantly declined, motivating them to make their
    revenue cycle operations more efficient.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    National healthcare reform is currently a major policy issue at
    the federal level. The Obama administration has made healthcare
    reform a priority, and several legislative proposals are
    currently being debated by Congress. Some of the underlying
    themes of current reform proposals are broadly targeted to
    driving greater efficiency in the U.S.&#160;healthcare system
    by, among other things, rewarding quality and coordination of
    care and promoting broader adoption of electronic medical
    records. Although it is impossible to predict what healthcare
    reform legislation, if any, will be enacted, we believe
    healthcare reform could create new business opportunities for us
    by increasing the need for
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    services such as those that we provide. For example, as a result
    of more complex reimbursement models and reduced fee-for-service
    reimbursement, healthcare providers may turn to outsourcing to
    extract more out of their existing revenue cycles. The increased
    attention to quality measures and risk/reward reimbursement
    models under some reform proposals could also create more
    interest in our service offerings.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">The Accretive
    Health Solution</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our solution is intended to address the full spectrum of revenue
    cycle operational issues faced by healthcare providers,
    including:
</DIV>

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    <TD width="5%"></TD>
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    <TD width="93%"></TD>
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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the increasingly complex and challenging payor environment;
</TD>
</TR>


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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a lack of fully integrated end-to-end revenue cycle management
    expertise;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
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    the consequences of increasing patient responsibility for their
    healthcare costs;
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    the difficulty and associated expense of a single organization
    acquiring and coordinating the knowledge and experience
    necessary to efficiently manage the revenue cycle;
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    ongoing attrition of revenue cycle staff;&#160;and
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    frequent patient confusion and frustration with financial
    obligations and billing.
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    The revenue cycle operations of a typical hospital, physician or
    other healthcare provider fail to capture and collect the total
    amounts owed to them from third-party payors and patients for
    medical services rendered, leading to significant bad debt
    write-offs, uncompensated care, payor denials and corresponding
    administrative write-offs, as well as lost revenue for missed
    charges. Fitch Ratings estimates that in 2008 uncompensated care
    (including bad debt write-offs, charity care and uninsured
    discounts) averaged 17% of net patient revenue at
    U.S.&#160;hospitals.
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    We deliver operating margin improvements to our customers
    through a combination of improvements in collections, which we
    refer to as net revenue yield, charge capture and revenue cycle
    cost reductions. Improvements in charge capture and collections
    are typically attributable to reduced payor denials,
    identification of additional items that can be billed to payors
    based on the actual procedures performed, identification of
    insurance for a higher percentage of otherwise uninsured
    patients, and improved collections of patient balances after
    insurance. Revenue cycle cost reductions are typically achieved
    through streamlining work flow, automating processes,
    centralizing vendor activities and implementing other
    efficiencies. Specific sources of margin improvement vary among
    customers.
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    Our customers have historically achieved significant net revenue
    yield improvements within 18 to 24&#160;months of implementing
    our operating model, with customers operating under mature
    managed service contracts realizing 400 to 600&#160;basis points
    in yield improvements, typically in the third or fourth contract
    year. During the assessment phase of the customer relationship,
    we identify specific areas for improvement in net revenue yield
    and begin implementation immediately upon execution of a managed
    services contract. While improvements in net revenue yield
    generally represent the majority of a customer&#146;s operating
    margin improvement, we generally are able to deliver additional
    margin improvement through revenue cycle cost reductions.
    Because our managed service contracts align our interests with
    those of our customers, we are able, over time, to improve our
    margins along with those of our customers.
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    We believe that our proprietary technology, management
    experience and well-developed processes are enhanced by the
    knowledge and experience we gain working with a wide range of
    customers and improve with each payor reimbursement or patient
    pay transaction. Our proprietary technology applications include
    workflow automation and direct payor connection capabilities
    that enable revenue cycle staff to focus on problem accounts
    rather than on manual tasks, such as searching payor websites
    for insurance and benefits verification for all patients. We
    employ &#147;exception based logic&#148; technology that
    provides the same interface for all users and automates a host
    of tasks that otherwise can consume a significant amount of
    staff time. We use real-time feedback from our
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    customers to improve the functionality and performance of our
    technology and processes and incorporate these improvements into
    our service offerings on a regular basis. We strive to apply
    operational excellence throughout the entire revenue cycle.
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    We adapt our solution to the hospital&#146;s organizational
    structure in order to minimize disruption to existing staff and
    to make our services transparent to both patients and
    physicians. The experience and knowledge of the senior
    management personnel we provide to our customers can improve the
    performance of their in-house revenue cycle staff. Our objective
    is to improve the operating performance of our customers, thus
    generating incentive fees for ourselves, by:
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    <B><I>Improving Net Revenue Yield.</I></B>&#160;&#160;We help
    our customers improve their net revenue yield. Through the use
    of our proprietary technologies and methodologies, we precisely
    calculate each customer&#146;s improvement in net revenue yield.
    This calculation compares the customer&#146;s actual cash
    collections for a given instance of care to the maximum
    potential cash receipts that the customer should have received
    from the instance of care, which we refer to as the best
    possible net compliant revenue. We aggregate these calculations
    for all instances of care and compare the result to the
    aggregate calculation for the year before we began to provide
    our services to the customer. We receive a share of each
    customer&#146;s improvement in net revenue yield.
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    <B><I>Increasing Charge Capture.</I></B>&#160;&#160;We help our
    customers increase their charge capture by implementing
    optimization techniques and related processes. We utilize
    sophisticated analytics and artificial intelligence software to
    help improve the accuracy of claims filings and the resolution
    of disputed claims from third-party insurance payors. We also
    overlay a range of capabilities designed to reduce missed
    charges, improve the clinical/reimbursement interface and
    produce bills that comply with third-party payor requirements
    and applicable healthcare regulations.
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    <B><I>Making Revenue Cycle Operations More
    Efficient.</I></B>&#160;&#160;We help our customers make their
    revenue cycle operations more efficient by implementing advanced
    technologies, streamlining operations, avoiding unnecessary
    re-work and improving quality. We also can reduce the costs of
    third-party services, such as Medicaid eligibility review, by
    transferring the work to our own internal operations. For some
    customers, we are able to reduce operating costs further by
    transferring selected internal operations to our centralized
    shared services centers located in the United States and India.
</TD>
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    We employ a variety of techniques intended to achieve this
    objective:
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    <B><I>Gathering Complete Information.</I></B>&#160;&#160;We
    focus on gathering complete patient information and educating
    the patient as to his or her potential financial
    responsibilities before receiving care so the services can be
    recorded and billed to the appropriate parties. Our systems
    maintain an automated electronic scorecard, which measures the
    efficiency of up-front data capture, billing and collections
    throughout the life cycle of any given patient account. These
    scorecards are analyzed in the aggregate, and the results are
    used to help improve work flow processes and operational
    decisions for our customers. We believe that hospitals employing
    our services have increased the percentage of non-emergency
    in-patient admissions with complete information profiles to
    nearly 100%, enabling fewer billing delays, increased charge
    capture and reduced billing cycles.
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    <B><I>Improving Claims Filing and Third-Party Payor
    Collections.</I></B>&#160;&#160;We implement sophisticated
    analytics designed to improve claims filing and collection of
    claims from third-party insurance payors. By employing
    proprietary algorithms and modeling to determine how hospital
    revenue cycle staff should allocate time and resources across a
    pool of outstanding claims, we can increase the likelihood that
    patient services will be reimbursed. In addition, our
    proprietary tools automatically analyze the information
    collected for each patient encounter, including insurance
    coverage, personal financial status and medical treatments
    administered, to improve
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    the revenue outcome from each patient account. This information
    is analyzed and updated in real time to help hospital
    administrators predict future cash flow and monitor
    underpayments from payors. Historically, third-party insurance
    payors have tracked patient services and billing information in
    more detail than hospitals, resulting in informational
    advantages for these third-party insurance payors. Our automated
    systems provide our customers with substantially the same
    quality and breadth of information available to many insurance
    companies, thereby helping them obtain contractually correct
    reimbursements in a timely manner.
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    <B><I>Identifying Alternative Payment
    Sources.</I></B>&#160;&#160;We use various methods to find
    payment sources for uninsured patients and reimbursement for
    services not covered by third-party insurance. Our patient
    financial screening technology and methodologies often identify
    federal, state or private grant sources to help pay for
    healthcare services. These techniques are designed to ease the
    financial burden on uninsured or underinsured patients and
    increase the percentage of patient bills that are actually paid.
    After a typical implementation period, we have been able to help
    our customers find a third-party payment source for
    approximately 85% of all admitted patients who identified
    themselves as uninsured.
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    <B><I>Employing Proprietary Technology and
    Algorithms.</I></B>&#160;&#160;Our service offerings employ a
    variety of proprietary data analytics and predictive modeling
    algorithms. For example, we identify patient accounts with
    financial risk by applying data mining techniques to the data we
    have collected. Our systems are designed to streamline work
    processes through the use of proprietary algorithms that focus
    revenue cycle staff effort on those accounts deemed to have the
    greatest potential for improving net revenue yield or charge
    capture. We frequently adjust our proprietary predictive
    algorithms to reflect changes in payor and patient behavior
    based upon the knowledge we glean from our entire customer base.
    As new customers are added and payor and patient behavior
    changes, the information we use to create our algorithms
    expands, increasing the accuracy and value of those algorithms.
    We rely upon a combination of trademark, copyright and trade
    secret law and contractual terms and conditions to protect our
    intellectual property rights, and have filed four patent
    applications covering key innovations utilized in our solution.
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    <B><I>Using Analytical Capabilities and Operational
    Excellence.</I></B>&#160;&#160;We draw on the experience that we
    have gained from working with many of the best healthcare
    provider systems in the United States to train hospital staffs
    about new and innovative revenue cycle management practices. We
    employ extensive analytical analyses to identify specific
    weaknesses in business processes. We also strive to achieve
    operational excellence and to foster an overall culture of
    leading by example. As a result, our
    <FONT style="white-space: nowrap">on-site</FONT>
    management teams have seen marked shifts in the behaviors of
    hospital administrative staff, including enthusiasm for setting
    daily and weekly goals, participation in daily
    <FONT style="white-space: nowrap">half-hour</FONT>
    gatherings to track results achieved during the day, and
    improved adherence to our standard operating procedures.
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    In addition, we help our customers increase their revenue cycle
    efficiency by implementing improved practices, advanced data
    management technology, streamlining work flow processes and
    outsourcing aspects of their revenue cycle operations. For
    example, services that can be shared across our customers, such
    as patient scheduling and pre-registration, medical
    transcription and patient financial services, can be performed
    in our shared services centers in the United States and India.
    By leveraging the economies of scale and experience of our
    shared services centers, we believe that we offer our customers
    better quality services at a lower cost. For those customers
    opting not to participate in our shared services program, we can
    help reduce costs by migrating services such as Medicaid
    eligibility, medical transcription and collections from external
    vendors to our internal staff.
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    <B><FONT style="font-family: Arial, Helvetica">Our
    Strategy</FONT></B>
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    Our goal is to become the preferred provider-of-choice for
    revenue cycle management services in the U.S.&#160;healthcare
    industry. Since our inception, we have worked with some of the
    largest and most prestigious healthcare systems in the United
    States, such as Ascension Health, the Henry Ford Health System
    and the Dartmouth-Hitchcock Medical Center. Going forward, our
    goal is to continue to expand the scope of our services to
    hospitals within our existing customers&#146; systems as well as
    to leverage our strong relationships with reference customers to
    continue to attract business from new customers. Key elements of
    our strategy include the following:
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    <B><I>Delivering Tangible, Long-Term Results by Providing
    End-to-End Services Across the Entire Revenue
    Cycle.</I></B>&#160;&#160;Our solution is designed to help our
    customers achieve sustainable economic value through
    improvements in operating margins. Improvements in our
    customers&#146; operating margins in turn provide recurring
    revenues for us. Our technology and services are deeply
    integrated across the entire spectrum of a customer&#146;s
    revenue cycle continuum, whereas most competitive offerings
    address a narrower portion of the revenue cycle. Our offering
    alleviates the need to purchase services from multiple sources,
    potentially saving customers time, money and integration
    challenges in their efforts to improve their revenue cycle
    activities.
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    <B><I>Continuing to Develop Innovative Approaches to Increase
    Yield on Patient-Owed Obligations.</I></B>&#160;&#160;We have
    developed and continue to design creative approaches intended to
    increase net revenue yields on patient-owed obligations. These
    processes include direct communications with payors to establish
    patient pay amounts (after insurance and taking into account
    deductibles) and status, contract modeling tools to provide
    patients with accurate updates on the portion of an outstanding
    balance for which they are personally responsible, and the
    provision of prior balance data and payment alternatives to
    patients at the point of service. We also use consumer behavior
    modeling and conduct trending analyses for collections, and we
    offer patients a variety of payment methods.
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    <B><I>Enhancing and Developing Proprietary Algorithms to
    Identify Potential Errors and to Make Process
    Corrections.</I></B>&#160;&#160;Even as patients begin to assume
    responsibility for a greater portion of the cost of medical
    services, healthcare providers continue to rely upon third-party
    payors for the majority of medical reimbursements. To help
    improve revenue collection rates and timing for claims owed by
    payors, we have developed proprietary algorithms to assess risk
    and the resulting treatment of claims. Our methodology is
    designed to enable nearly 100% of outstanding claims to be
    reviewed, prioritized and pursued, compared to the prevailing
    industry practice of pursuing only 80% of the outstanding
    claims. In instances where our customers had been using other
    third-party tools, we routinely identify multiple additional
    lost charges. We believe that our focus on collecting revenue
    from a broader range of outstanding claims and reducing the
    average time to collection differentiates our revenue cycle
    management services.
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    <B><I>Expanding Our Shared Services
    Program.</I></B>&#160;&#160;Our shared services program, which
    includes patient scheduling and pre-registration, medical
    transcription and patient financial services, is structured to
    reduce a hospital&#146;s overhead costs while providing services
    of comparable or higher quality. Expansion of our shared
    services program is potentially advantageous for both our
    customers and us, as we both benefit from greater savings
    attributable to economies of scale and improvements in net
    revenue yield. We believe that continuing to transition
    customers to our shared services will help us achieve our
    targeted improvements in customer operating margins. We
    introduced the shared services program in 2008, and we continue
    to see interest in this offering from both new and existing
    customers. Currently, approximately 35% of our customers
    participate in our shared services program.
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    <B><I>Hiring, Training and Retaining Our
    Personnel.</I></B>&#160;&#160;Our solution was developed by what
    we believe to be the best personnel available in the market. In
    order to grow our business and solidify our competitive
    position, we need to continue to hire, train and retain very
    talented
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    team members who demonstrate a strong focus on outstanding
    customer service. Employee recruitment is a priority for us
    because we believe that our long-term growth is limited more by
    the availability of top talent than by constraints in market
    demand for our solution. We seek an ongoing influx of new
    personnel at all levels so that we have adequate staffing to
    pursue and accept new customer opportunities. We also make
    substantial ongoing investments in employee training, including
    our &#147;operator academy&#148; and &#147;revenue cycle
    academy&#148; which enable us to educate all new employees
    regarding our operating model and related processes and
    technology.
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    <B><I>Continuing to Diversify Our Customer
    Base.</I></B>&#160;&#160;In October 2004, Ascension Health
    became our founding customer. While Ascension Health is our
    largest customer and we expect to continue to expand our
    presence within Ascension Health&#146;s network of affiliated
    hospitals, we are focusing our marketing efforts primarily on
    other healthcare providers and expect to continue to diversify
    our customer base. In the six months ended June&#160;30, 2009
    compared to the six months ended June&#160;30, 2008, our net
    services revenue from customers not affiliated with Ascension
    Health grew by 62.1%, while our net services revenue from
    hospitals affiliated with Ascension Health grew by 10.5%. As a
    result, the percentage of our total net services revenue
    attributable to hospitals affiliated with Ascension Health
    declined from 88.7% in the year ended December&#160;31, 2006 to
    63.6% in the six months ended June&#160;30, 2009. Since
    January&#160;1, 2007, approximately $5.0 billion of the
    $7.1&#160;billion in annual net patient revenue that we added to
    our customer base was unrelated to Ascension Health.
</TD>
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    <B><I>Developing Enhanced Service Offerings that Offer Long-Term
    Opportunities.</I></B>&#160;&#160;We intend to continue to
    introduce new services that draw upon our core competencies and
    that we believe will be attractive to our target customers. In
    considering new services, we look for market opportunities that
    we believe present low barriers to entry, require limited
    incremental cost and present significant growth opportunities.
    For example, we recently began targeting large physicians&#146;
    billing organizations that are linked to hospital systems, and
    we are developing an initiative focused on increasing the
    quality of healthcare through incentive payments to primary care
    physicians. We also plan to selectively pursue acquisitions that
    will enable us to broaden our service offerings.
</TD>
</TR>

</TABLE>

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    <B><FONT style="font-family: Arial, Helvetica">Our
    Services</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Core Service
    Offering</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our core offering consists of end-to-end, integrated technology
    and revenue cycle management services. We assume full
    responsibility for the management and cost of the
    customer&#146;s end-to-end revenue cycle operations in exchange
    for a base fee and the opportunity to earn incentive fees. To
    implement our solution, we supplement the customer&#146;s
    existing revenue cycle management and staff with seasoned
    Accretive Health revenue cycle leaders, subject matter experts
    and staff, and connect our proprietary technology and analytical
    tools to the hospital&#146;s existing technology systems. Our
    employees that we add to the hospital&#146;s revenue cycle team
    typically have significant experience in healthcare management,
    revenue cycle operations, technology, quality control and other
    management disciplines. In addition to implementing revenue
    enhancement procedures, we help our customers reduce their
    revenue cycle costs by implementing improved practices, advanced
    data management technology and more efficient processes, as well
    as outsourcing aspects of their revenue cycle operations. We
    seek to adapt our solution to the hospital&#146;s organizational
    structure in order to minimize disruption to existing staff and
    to make our services transparent to both patients and physicians.
</DIV>

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    We believe that our solution offers our customers a number of
    strategic, financial and operational benefits:
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    <B><I>Operating Management.</I></B>&#160;&#160;We assign
    highly-trained management teams to each customer site to
    facilitate technology implementation, provide hands-on training
    to existing hospital employees and guide staff toward achievable
    performance goals.
</TD>
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    <B><I>Technology Improvements.</I></B>&#160;&#160;We integrate
    our proprietary technology with a hospital&#146;s transaction
    systems to help improve claims collections and realize operating
    efficiencies. By using a web interface to layer our tools on top
    of a hospital&#146;s existing software, we can bring our
    capabilities online in a timely manner without requiring any
    up-front hardware investment by customers.
</TD>
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    <B><I>Standardized Operating Model.</I></B>&#160;&#160;We offer
    our customers a revenue cycle operating model that has delivered
    tangible financial benefits. Our standard implementation
    techniques are designed to enable us to install our operating
    model in a timely manner and consistently at customer sites. We
    utilize a uniform set of key performance indicators to drive and
    assess the revenue cycle operations of our customers. Our senior
    operational leaders closely monitor each customer&#146;s revenue
    cycle performance through ten to twelve operating reviews each
    year.
</TD>
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    <B><I>Multi-Industry Revenue Process
    Experience.</I></B>&#160;&#160;Our personnel have years of prior
    work experience advising customers on revenue process management
    issues in complex industries. We have combined this experience
    with healthcare industry innovative practices and operational
    excellence to form the foundation of our service offerings. We
    believe that the depth and breadth of our knowledge of
    healthcare and non-healthcare revenue cycle management help
    differentiate us from our competitors.
</TD>
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    <B><I>Shared Services.</I></B>&#160;&#160;We offer customers the
    opportunity to realize operating efficiencies by outsourcing
    certain revenue tasks and responsibilities to shared facilities
    that we operate. By allowing multiple, unrelated hospitals to
    utilize the same set of resources for key revenue cycle tasks,
    our shared services capability provides opportunities to reduce
    the operating costs of our customers. We have been able to
    achieve meaningful margin improvements for the customers that
    utilize our shared services.
</TD>
</TR>

</TABLE>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our solution spans a hospital&#146;s entire revenue cycle. We
    deploy our proprietary technology and management experience at
    each key point in the revenue cycle. As part of our solution, we
    make targeted changes in the hospital&#146;s processes designed
    to improve its revenue cycle operations. We also implement
    cost-reduction programs, including the use of our shared
    services centers for customers who choose to participate and,
    for other customers, by moving services such as Medicaid
    eligibility, transcription and collections from external vendors
    to our internal staff.
</DIV>

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    <IMG src="c53658c5365811.gif" alt="(FLOW CHART)">
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    <B><I>Front Office (Patient Access).</I></B>&#160;&#160;A
    hospital&#146;s front office revenue cycle operations typically
    consist of scheduling, pre-registration, registration and
    collection of patient co-payments. Complete and accurate
    information gathering at this stage is critical to a
    hospital&#146;s ability to collect revenue from the patient and
    third-party payors after healthcare services are provided.
</DIV>

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    AHtoAccess, our integrated suite of proprietary patient
    admission tools, is designed to minimize downstream collections
    issues by standardizing up-front patient information gathering
    through direct connections between the customer and each of its
    third-party payors and automated workflow navigation of
    authorization and referral requirements. AHtoAccess is used by
    our <FONT style="white-space: nowrap">on-site</FONT>
    management teams and hospital employees to handle a variety of
    front office tasks, including:
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    verification of patient contact information, which improves
    accuracy of recording patient admissions data in the
    hospital&#146;s patient accounting system;
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    real-time validation of coverage and benefits for insured
    patients, which allows up front assessment of each
    patient&#146;s ability to pay;
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    screening of self-pay patients for alternative coverage
    solutions, which helps identify payment sources including
    long-term payment plans and charity or government-sponsored
    coverage for uninsured or underinsured patients;&#160;and
</TD>
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    up-front calculation of patient pay residuals, which facilitates
    accurate and timely communication and collection of residual
    payment obligations and any outstanding patient balances from
    previous services.
</TD>
</TR>

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    <B><I>Middle Office (Health Services
    Billing).</I></B>&#160;&#160;Once treatment has been provided to
    a patient, a hospital&#146;s middle office revenue cycle
    operations typically consist of transcribing physicians&#146;
    dictated records of patient care and related diagnoses,
    assigning treatment codes so that bills may be generated and
    consolidating all patient information into a single patient
    file. Our solution provides opportunities to improve revenue
    yield attributable to the middle office by enabling a customer
    to properly bill all appropriate charges, reduce payor coverage
    denials based upon inaccurate or
</DIV>

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    73
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    incomplete billing or untimely filing, and improve the accuracy
    and comprehensiveness of patient and billing information to
    enable bills to be issued in a timely and efficient manner.
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We deploy several proprietary software tools in the middle
    office. AHtoCharge is an automated variance detection tool used
    to identify missing charges in patient bills and to detect
    coding errors in patient records. In addition to the use of
    proprietary technology, we enhance a hospital&#146;s revenue
    cycle operations in the middle office with our:
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    in-house nurse auditors, who review the accuracy of treatments,
    diagnoses and charges in patient records and
    <FONT style="white-space: nowrap">follow-up</FONT>
    with hospital revenue cycle staff so that the bills may be
    updated and sent out within the normal billing cycle;&#160;and
</TD>
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    on-staff physicians, who help hospital case managers properly
    code emergency department patients during their transition from
    &#147;observation&#148; to &#147;in-patient&#148; status, to
    improve accurate and appropriate billing to payors.
</TD>
</TR>

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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

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    <B><I>Back Office (Collections).</I></B>&#160;&#160;A
    hospital&#146;s back office revenue cycle operations typically
    consist of bill creation and submission,
    <FONT style="white-space: nowrap">follow-up</FONT> to
    resolve unpaid or underpaid claims and re-submit incomplete
    claims, the collection of amounts due from patients and the
    application of cash payments to outstanding balances. At this
    stage of the revenue cycle, efficiency and data accuracy are
    critical to increasing the hospital&#146;s collections from all
    responsible parties in a timely manner, and reducing the
    hospital&#146;s bad debt expense. Our solution is designed to
    improve revenue yield attributable to the back office by
    enabling a customer to:
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    decrease the time required for bill creation and submission;
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    increase the percentage of claims receiving maximum allowable
    reimbursement from payors;
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    find alternative payment sources for unpaid and underpaid claims
    with both third-party payors and patients;&#160;and
</TD>
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    reduce contractual write-offs to provide an accurate record of
    outstanding charges.
</TD>
</TR>

</TABLE>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We deploy a number of proprietary tools in the back office:
</DIV>

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    <TD>&nbsp;</TD>
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</TD>
    <TD align="left">
    <B><I>Yield-Based Follow Up.</I></B>&#160;&#160;Our Yield-Based
    Follow Up tool enables us to pursue reimbursement for claims
    based on risk scoring and detection as established by our
    proprietary algorithms.
</TD>
</TR>


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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Medical Financial Solutions.</I></B>&#160;&#160;Our
    Medical Financial Solutions tool uses proprietary algorithms to
    assess a patient&#146;s propensity to pay and determines
    <FONT style="white-space: nowrap">follow-up</FONT>
    actions structured to allow higher yields with lower collections
    effort.
</TD>
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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Retro Eligibility.</I></B>&#160;&#160;Our Retro
    Eligibility tool continually searches for insurance coverage for
    each patient visit, even after treatment has concluded, to
    determine whether uninsured patients are eligible for some form
    of insurance coverage.
</TD>
</TR>


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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>AHtoContract.</I></B>&#160;&#160;Our AHtoContract tool
    utilizes proprietary modeling and analytics to calculate the
    aggregate reimbursement due to the hospital from third-party
    payors and patients for a given patient treatment.
</TD>
</TR>


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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Underpayments.</I></B>&#160;&#160;Our Underpayments tool
    employs payor remittance data and contract models to determine
    whether a payor has reimbursed less than its contracted amount
    for a specific claim and enables the hospital&#146;s back office
    staff to resolve these situations directly with payors.
</TD>
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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>AHtoPost.</I></B>&#160;&#160;Our AHtoPost tool is used by
    our shared services centers to centralize the task of posting
    cash payments to customers&#146; patient accounting systems,
    combining a sophisticated software platform with optical
    character recognition technology.
</TD>
</TR>

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    <BR>
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

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    <B><I><FONT style="font-family: Arial, Helvetica">Accretive
    Direct Service Offering</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our &#147;Accretive Direct&#148; service offering is a focused
    technology and services solution for smaller hospitals where
    implementation of the complete suite of
    <FONT style="white-space: nowrap">on-site</FONT>
    management assistance included with our core service offering is
    not economically feasible. This service offering incorporates
    additional automation and standardization into our revenue cycle
    management solution with less reliance on infused management
    personnel. Currently, we have one customer that uses our
    Accretive Direct services, which include:
</DIV>

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    <TD align="left">
    implementation of our AHtoAccess tool in the customer&#146;s
    front office revenue cycle operations;
</TD>
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    implementation of our AHtoCharge tool and our physician advisory
    services in the customer&#146;s middle office revenue cycle
    operations;
</TD>
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    <TD align="left">
    outsourcing of the customer&#146;s pre-service patient calling
    activities, back office revenue cycle operations and patient
    financial services activities to our shared services operating
    centers;&#160;and
</TD>
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    support for audits of Medicare charges.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Quality/Cost
    Service Initiative</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We are pursuing a new quality/cost service initiative that we
    believe presents attractive growth potential for us. We are
    building a turnkey technology and service solution that, once
    completed and implemented, would allow formal and informal
    organized delivery systems to provide population-based
    management of care, as compared to episodic care, and reward
    providers for cost savings and increased quality. We believe
    that our knowledge and understanding of the U.S.&#160;healthcare
    payment and reimbursement system, our business process
    experience and our technology position us well to pursue this
    opportunity.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Healthcare providers tend to focus on their own role in patient
    care rather than the totality of a patient&#146;s healthcare.
    This approach often leads to ineffective care coordination and
    can have a negative impact on healthcare quality and cost. Our
    quality/cost service initiative is intended to link episodes of
    care and facilitate the re-emergence of the primary care
    physician, or PCP, as the coordinator of care for each patient.
    We believe that appropriate financial incentives can be designed
    to encourage PCPs to focus on the prevention of acute care
    episodes&#160;&#151; for example, through comprehensive annual
    physicals and the systematic use of HbA1c blood sugar tests for
    diabetics&#160;&#151; and, when those episodes do occur, to
    focus on the prevention of hospital readmissions. To accomplish
    these objectives, the financial incentives would relate to,
    among other things, total integration of care, medical best
    practices and the use of healthcare information technology.
    Because PCPs drive the vast majority of healthcare decisions
    (excluding personal lifestyle decisions) that have an impact on
    healthcare, we believe that this initiative could reduce costs
    and increase healthcare quality.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We believe a service offering of this nature would be attractive
    to healthcare providers because of the potential for higher
    quality patient care and lower healthcare costs. In addition,
    the American Recovery and Reinvestment Act enacted in February
    2009 provides for potential payments over time of up to $44,000
    (under Medicare) and $64,000 (under Medicaid) to any physician
    who adopts and &#147;meaningfully uses&#148; electronic health
    records, and we believe our healthcare information technology
    can help physicians qualify for these payments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We plan to beta test our quality/cost initiative at selected
    customer sites and expect to be in a position to roll out a
    service offering based on this initiative during 2010.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Customers</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Customers for our core service offering typically are
    multi-hospital systems, including faith-based or community
    healthcare systems, academic medical centers and independent
    clinics, and the
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    physician practice groups affiliated with those systems. Our
    core service offering is best-suited for healthcare
    organizations in which substantial improvements can be realized
    through the full implementation of our solution. Our Accretive
    Direct service offering is targeted to hospitals with less than
    $250&#160;million in annual net patient revenue. We seek to
    develop strategic, long-term relationships with our customers
    and focus on providers that we believe understand the value of
    our operating model and have demonstrated success in both
    clinical and operational outcomes. In October 2004, Ascension
    Health became our founding customer. While Ascension Health is
    still our largest customer and we expect to continue to expand
    our presence beyond the hospitals we currently service within
    Ascension Health&#146;s network, we are focusing our marketing
    efforts primarily on other healthcare providers and expect to
    continue to diversify our customer base. As of June&#160;30,
    2009, we provided our integrated revenue cycle service offering
    to 21 customers representing 53 hospitals and $11.9&#160;billion
    in annual net patient revenue, as well as physicians&#146;
    billing organizations associated with several of these customers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We target seven market segments in the United States for our
    integrated revenue cycle service offering:
</DIV>

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    <B><I>Academic Medical Centers and Ambulatory
    Clinics.</I></B>&#160;&#160;Academic medical centers and
    ambulatory clinics, including related physician practices,
    represent approximately $120&#160;billion in annual net patient
    revenue. This market segment offers attractive opportunities for
    us because of the significant size and patient volume of
    academic medical centers and ambulatory clinics (typically more
    than $1&#160;billion each in net patient revenue) and the
    fragmented revenue cycle management operations of most physician
    practices. Our customers in this market segment include the
    Dartmouth-Hitchcock Medical Center and the Henry Ford Health
    System.
</TD>
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</TD>
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    <B><I>Catholic Community Healthcare
    Systems.</I></B>&#160;&#160;Catholic community healthcare
    systems represented our initial target market segment and remain
    a primary focus for us. Catholic community healthcare systems
    manage approximately $62&#160;billion in annual net patient
    revenue. Ascension Health is the nation&#146;s largest Catholic
    and largest non-profit healthcare system, with a network of 78
    hospitals and related healthcare facilities located in
    20&#160;states and the District of Columbia. We serve a number
    of hospitals and regional healthcare systems affiliated with
    Ascension Health.
</TD>
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    <B><I>Other Faith-Based Community Healthcare
    Systems.</I></B>&#160;&#160;Drawing on our experience with the
    Catholic community healthcare system market, we also target the
    market for other faith-based community healthcare systems.
    Healthcare systems affiliated with other religious faiths manage
    approximately $42&#160;billion in annual net patient revenue. We
    serve several regional healthcare systems in this market segment.
</TD>
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    <B><I>Not-for-Profit Community
    Hospitals.</I></B>&#160;&#160;There are nearly 2,000
    not-for-profit community hospitals, with a variety of
    affiliations that are not faith-based. Not-for-profit community
    hospitals manage approximately $241&#160;billion in annual net
    patient revenue. We serve several customers in this market
    segment.
</TD>
</TR>


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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Physicians&#146; Billing
    Organizations.</I></B>&#160;&#160;Large physicians&#146; billing
    organizations, with at least 75&#160;physicians each, represent
    approximately $115&#160;billion in annual net patient revenue.
    Our customer work in this market includes the billing activities
    involving several hundred physicians at the Dartmouth-Hitchcock
    Medical Center and the Henry Ford Health System.
</TD>
</TR>


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</TD>
    <TD align="left">
    <B><I>For-Profit Hospital Systems.</I></B>&#160;&#160;For-profit
    hospital systems manage approximately $80&#160;billion in annual
    net patient revenue. This sector, although smaller than the
    not-for-profit sector, still represents a significant target
    market segment for our revenue cycle services. We do not
    currently have any customers in this market segment.
</TD>
</TR>


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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Government-Owned Hospitals.</I></B>&#160;&#160;Each major
    metropolitan area in the United States has at least one large
    municipal or city-owned hospital system, with annual net patient
    revenue
</TD>
</TR>

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<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
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    <TD>&nbsp;</TD>
    <TD>
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    <TD align="left">
    typically in the range of $500&#160;million to $1&#160;billion.
    This market segment represents approximately $95&#160;billion in
    annual net patient revenue. We do not currently have any
    customers in this market segment.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We believe that the diversity of our customer base, ranging from
    not-for-profit community hospitals to large academic medical
    centers and healthcare systems, demonstrates our ability to
    adapt and apply our operating model to many different situations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Sales and
    Marketing</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our new business opportunities have historically been generated
    through high-level industry contacts of members of our senior
    management team and board of directors and positive references
    from existing customers. As we have grown, we have added senior
    sales executives and adopted a more institutional approach to
    sales and marketing that relies on systematic relationship
    building by all of our senior team members. Our sales process
    generally begins by engaging senior executives of the
    prospective hospital or healthcare system, typically followed by
    our assessment of the prospect&#146;s existing revenue cycle
    operations and a review of the findings. We employ a
    standardized managed service contract that is designed to
    streamline the contract process and support a collaborative
    discussion of revenue cycle operation issues and our proposed
    working relationship. Our sales process typically requires six
    to twelve months from the introductory meeting to contract
    execution.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Technology</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Technology
    Development</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our technology development organization operates out of various
    facilities in the United States and India. Our technology is
    developed in-house by Accretive Health employees, although at
    times we may supplant our technology development team with
    independent contractors. We use a rapid application development
    methodology in which new functionality and enhancements are
    released on a
    <FONT style="white-space: nowrap">30-day</FONT>
    cycle, and minor functionality or &#147;patch&#148; work is
    released on a
    <FONT style="white-space: nowrap">seven-day</FONT>
    cycle. Based upon this schedule, we release approximately eleven
    technology offerings with new functionalities each year across
    each of the four principal portions of our customer-facing
    applications. All customer sites run the same base set of code
    with modifications isolated via a configuration management
    approach. We use a beta-testing environment to develop and test
    new technology offerings at one or more customers, while keeping
    the rest of our customers on production-level code.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our applications are deployed on a consistent architecture based
    upon an industry-standard Microsoft SQL*Server database and a
    &#147;DotNetNuke&#148; open source application architecture.
    This architecture provides a common framework for development,
    which in turn simplifies the development process and offers a
    common interface for end users. We believe the consistent look
    and feel of our architecture allows our customers and staff to
    begin using ongoing enhancements to our software suite quickly
    and easily.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We devote substantial resources to our development efforts and
    plan at a yearly, half-yearly, quarterly and release level. We
    employ a &#147;value point&#148; scoring system to assess the
    impact an enhancement will have on net revenue, costs,
    efficiency and customer satisfaction. The results of this value
    point system analysis are evaluated in conjunction with our
    overall corporate goals when making development decisions. In
    addition to our technology development team, our operations
    personnel play an integral role in setting technology priorities
    in support of their objective of keeping our software operating
    24&#160;hours a day, 7&#160;days a week.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Technology
    Operations</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our applications are hosted in data centers located in Atlanta,
    Georgia and Salt Lake City, Utah, and our internal financial
    application suite is hosted in a data center in Minneapolis,
    Minnesota. These data centers are operated for us by third
    parties and are SAS-70 compliant. Our development, testing
</DIV>

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    and quality assurance environment is operated from the data
    center in Atlanta with a separate server room in Chicago,
    Illinois. We have agreements with our hardware and system
    software suppliers for support 24&#160;hours a day, 7&#160;days
    a week. Our operations personnel also use our resources located
    in our other U.S.&#160;facilities and in our India facilities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Customers use high-speed Internet connections or private network
    connections to access our business applications. We utilize
    commercially available hardware and a combination of
    custom-developed and commercially available software. We
    designed our primary application in this manner to permit
    scalable growth. For example, database servers can be added
    without adding web servers, and vice versa. We believe that this
    architecture enables us to scale our operations effectively and
    efficiently.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our databases and servers are
    <FONT style="white-space: nowrap">backed-up</FONT> in
    full on a weekly basis and undergo incremental
    <FONT style="white-space: nowrap">back-ups</FONT>
    nightly. Databases are also
    <FONT style="white-space: nowrap">backed-up</FONT>
    frequently by automatically shipping log files with accumulated
    changes to separate sets of
    <FONT style="white-space: nowrap">back-up</FONT>
    servers. In addition to serving as a
    <FONT style="white-space: nowrap">back-up,</FONT>
    these log files update the data in our online analytical
    processing engine, enabling the data to be more current than if
    only refreshed overnight. Data and information regarding our
    customers&#146; patients is encrypted when transmitted over the
    internet or traveling off-site on portable media such as laptops
    or backup tapes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Customer system access requests are load-balanced across
    multiple application servers, allowing us to handle additional
    users on a per-customer basis without application changes.
    System utilization is monitored for capacity planning purposes.
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our software interacts with our customers&#146; software through
    a series of real-time and batch interfaces. We do not require
    changes to the customer&#146;s core patient care delivery or
    financial systems. Instead of installing hardware or software in
    customer locations or data centers, we specify the information
    that a customer needs to extract from its existing systems in
    order to interface with our systems. This methodology enables
    our systems to operate with many combinations of customer
    systems, including custom and industry-standard implementations.
    We have successfully integrated our systems with 15 to
    20&#160;year old systems, with package and custom systems, and
    with major industry-standard products.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    When these interfaces are in place, we provide a tool suite
    across the hospital revenue cycle. For our purposes, the revenue
    cycle starts when a patient registers for future service or
    arrives at a hospital or clinic for unscheduled service and ends
    when the hospital has collected all the appropriate revenue from
    all possible sources. Thus, we provide eligibility, address
    validation, skip tracing, charge capture, patient and payor
    <FONT style="white-space: nowrap">follow-up,</FONT>
    analytics and tracking, charge master management, contract
    modeling, contract &#147;what if&#148; analysis, collections and
    other functions throughout the front office, middle office and
    back office operations of a customer&#146;s revenue cycle.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Because our databases run on industry-standard hardware and
    software, we are able to use all standard tools to develop,
    maintain and monitor our solution. Databases for one or more
    customers can run on a single database server with disk storage
    configured as a redundant array of inexpensive disks (RAID). In
    the event of a server failure, we have maintenance contracts in
    place that require the service provider to have the server back
    on-line in four hours or less, or we move the customer
    processing to another server. The RAID configuration protects
    against disk failures having an impact on our operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In the event that a combination of events causes a system
    failure, we typically can isolate the failure to one or a small
    number of customers. We believe that no combination of failures
    by our systems can impact a customer&#146;s ability to deliver
    patient care, nor can any such failures prevent accurate
    accounting of customer finances because accounting functions are
    maintained on customer systems. In the past twelve months, our
    up-time has exceeded 99.45% of planned up-time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our data centers were designed to withstand many catastrophic
    events, such as blizzards and hurricanes. To protect against a
    catastrophic event in which our primary data center is
    completely
</DIV>

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    <BR>
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    destroyed and service cannot be restored within a few days, we
    store backups of our systems and databases off-site. In the
    event that we had to move operations to a different data center,
    we would re-establish operations by provisioning new servers,
    restoring data from the off-site backups and re-establishing
    connectivity with our customers&#146; host systems. Because our
    systems are web-based, no changes would need to be made on
    customer workstations, and customers would be able to reconnect
    as our systems became available again.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

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    We monitor the response time of our application in a number of
    ways. We monitor the response time of individual transactions by
    customer and place monitors inside our operations and at key
    customer sites to run synthetic transactions that demonstrate
    our systems&#146; end-to-end responsiveness. Our hosting
    provider reports on responsiveness
    <FONT style="white-space: nowrap">server-by-server</FONT>
    and identifies potential future capacity issues. In addition, we
    survey key customers regarding system response time to make sure
    customer-specific conditions are not impacting performance of
    our tools.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Proprietary
    Software Suite</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our proprietary AHtoAccess software suite is composed of a broad
    range of integrated functional areas or domains. The
    &#147;patient access&#148;, &#147;improving best possible&#148;,
    <FONT style="white-space: nowrap">&#147;follow-up&#148;</FONT>
    and &#147;measurement&#148; domains utilize interdependent
    design and development paths and are an integral driver of value
    throughout our customers&#146; entire revenue cycle. These
    domains correspond to the front office, middle office and back
    office revenue cycle business processes described above.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The &#147;patient access&#148; domain is used during hospital
    employees&#146; first interactions with patients, either at the
    point of service in a hospital or in advance of a hospital visit
    during our pre-registration process. The domain uses a
    straightforward, consistent architecture.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The &#147;improving best possible&#148; domain is designed to
    facilitate top-line revenue improvements and bottom-line
    efficiency gains. The domain&#146;s AHtoCharge tool is a
    rules-based engine that, with the oversight of a centralized
    team of nurse-auditors, automatically analyzes medical billing
    and coding data to identify inconsistencies that may delay or
    hinder collections.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The
    <FONT style="white-space: nowrap">&#147;follow-up&#148;</FONT>
    domain tracks unpaid claims and contacts with insurance
    companies, government organizations and other payors responsible
    for outstanding debts for past patient services. The domain also
    organizes previously unpaid claims using a proprietary
    risk-based algorithm.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The &#147;measurement&#148; domain integrates our functional
    domains by providing real-time metrics and insight into the
    operation of revenue cycle businesses. This application can be
    used to generate standard operational reports and allows the end
    user to review and analyze all of the micro-level data that
    supports the results found in these reports.
</TD>
</TR>

</TABLE>

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    <BR>
    79
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <IMG src="c53658c5365812.gif" alt="(FLOW CHART)">
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In addition to applications designed for use by our customers,
    we have developed proprietary software for use in our
    collections operations and measurement activity. To manage
    patient
    <FONT style="white-space: nowrap">follow-up</FONT>
    activities and the collection of patient debt, we use a
    combination of off-the-shelf telephony and campaign management
    software which analyzes critical data points to determine the
    optimum approach for collecting outstanding debts. Our
    measurement system enables a user to generate models for
    outstanding medical claims related to specific third-party
    payors and determine the maximum allowed reimbursement, based
    upon the hospital&#146;s contract with each payor.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Competition</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    While we do not believe any single competitor offers a fully
    integrated, end-to-end revenue cycle management solution, we
    face competition from various sources.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The internal revenue cycle management staff of hospitals, who
    historically have performed the functions addressed by our
    services, in effect compete with us. Hospitals that previously
    have made investments in internally developed solutions
    sometimes choose to continue to rely on their own internal
    revenue cycle management staff.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We also compete with three categories of external participants
    in the revenue cycle market, most of which focus on small
    components of the hospital revenue cycle:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    software-as-a-service or other technology-supported revenue
    cycle management business process outsourcing companies, such as
    athenahealth, Eclipsys and MedAssets;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    traditional consultants, either specialized healthcare
    consulting firms or healthcare divisions of large accounting
    firms, such as Deloitte Consulting and Huron Consulting;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    IT outsourcers, which typically are large, non-healthcare
    focused business process outsourcing and information technology
    outsourcing firms, such as Perot Systems and Computer Science
    Corporation/First Consulting.
</TD>
</TR>

</TABLE>

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    80
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We believe that competition for revenue cycle management
    services is based primarily on the following factors:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    knowledge and understanding of the complex healthcare payment
    and reimbursement system in the United States;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a track record of delivering revenue improvements and efficiency
    gains for hospitals and healthcare systems;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the ability to deliver a solution that is fully-integrated along
    each step of a hospital&#146;s revenue cycle operations;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    cost-effectiveness, including the breakdown between up-front
    costs and pay-for-performance incentive compensation;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reliability, simplicity and flexibility of the technology
    platform;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    understanding of the healthcare industry&#146;s regulatory
    environment;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    sufficient infrastructure and financial stability.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We believe that we compete effectively based upon all of these
    criteria. We also believe that several aspects of our business
    model differentiate us from our competitors:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our solution does not require any up-front cash investment from
    customers and we do not charge hourly or licensing fees for our
    services;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we serve only healthcare providers and do not provide services
    to third-party payors;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we focus on delivering significant and sustainable revenue cycle
    improvements rather than one-time cost reductions only.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Nonetheless, we operate in a growing and attractive market with
    a steady stream of new entrants. Although we believe that there
    are significant barriers to replicating our end-to-end revenue
    cycle solution, other companies may develop superior or more
    economical service offerings that hospitals could find more
    attractive than our offerings. Moreover, the regulatory
    landscape may shift in a direction that is more strategically
    advantageous to existing and future companies.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Government
    Regulation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The customers we serve are subject to a complex array of federal
    and state laws and regulations. These laws and regulations may
    change rapidly, and it is frequently unclear how they apply to
    our business. We devote significant efforts, through training of
    personnel and monitoring, to establish and maintain compliance
    with all regulatory requirements that we believe are applicable
    to our business and the services we offer.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Government
    Regulation of Health Information</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Privacy and Security Regulations.</I></B>&#160;&#160;The
    Health Insurance Portability and Accountability Act of 1996, as
    amended, and the regulations that have been issued under it,
    which we collectively refer to as HIPAA, contain substantial
    restrictions and requirements with respect to the use and
    disclosure of individuals&#146; protected health information.
    HIPAA prohibits a covered entity from using or disclosing an
    individual&#146;s protected health information unless the use or
    disclosure is authorized by the individual or is specifically
    required or permitted under HIPAA. Under HIPAA, covered entities
    must establish administrative, physical and technical safeguards
    to protect the confidentiality, integrity and availability of
    electronic protected health information maintained or
    transmitted by them or by others on their behalf.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    HIPAA applies to covered entities, such as healthcare providers
    that engage in HIPAA-defined standard electronic transactions,
    health plans and healthcare clearinghouses, as well as
    &#147;business
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    associates&#148; that perform functions on behalf or provide
    services to covered entities. Our customers are covered
    entities, and we are considered a &#147;business associate&#148;
    under HIPAA as a result of our contractual obligations to and
    interactions with our customers. In order to provide customers
    with services that involve the use or disclosure of protected
    health information, HIPAA requires our customers to enter into
    business associate agreements with us so that certain HIPAA
    requirements would be applied to us as contractual commitments.
    Such agreements must, among other things, provide adequate
    written assurances:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    as to how we will use and disclose the protected health
    information;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    that we will implement reasonable administrative, physical and
    technical safeguards to protect such information from misuse;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    that we will enter into similar agreements with our agents and
    subcontractors that have access to the information;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    that we will report security incidents and other inappropriate
    uses or disclosures of the information;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    that we will assist the customer with certain of its duties
    under HIPAA.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Transaction Requirements.</I></B>&#160;&#160;In addition
    to privacy and security requirements, HIPAA also requires that
    certain electronic transactions related to healthcare billing be
    conducted using prescribed electronic formats. For example,
    claims for reimbursement that are transmitted electronically to
    payors must comply with specific formatting standards, and these
    standards apply whether the payor is a government or a private
    entity. We are contractually required to structure and provide
    our services in a way that supports our customers&#146; HIPAA
    compliance obligations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Data Security and Breaches.</I></B>&#160;&#160;In recent
    years, there have been well-publicized data breach incidents
    involving the improper dissemination of personal health and
    other information of individuals, both within and outside of the
    healthcare industry. Many states have responded to these
    incidents by enacting laws requiring holders of personal
    information to maintain safeguards and to take certain actions
    in response to data breach incidents, such as providing prompt
    notification of the breach to affected individuals and
    government authorities. In many cases, these laws are limited to
    electronic data, but states are increasingly enacting or
    considering stricter and broader requirements. In February 2009,
    HIPAA was amended by the Health Information Technology for
    Economic and Clinical Health, or HITECH, Act to add provisions
    that will, beginning in 2010, impose certain of the HIPAA
    privacy and security requirements directly upon business
    associates. When new regulations take effect in late 2009, both
    covered entities and their business associates will be required
    to notify individuals and government authorities of data
    security breaches involving unsecured protected health
    information. In addition, the U.S.&#160;Federal Trade
    Commission, or FTC, has prosecuted some data breach cases as
    unfair and deceptive acts or practices under the Federal Trade
    Commission Act. We have implemented and maintain physical,
    technical and administrative safeguards intended to protect all
    personal data and have processes in place to assist us in
    complying with applicable laws and regulations regarding the
    protection of this data and properly responding to any security
    incidents.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>State Laws.</I></B>&#160;&#160;In addition to HIPAA, most
    states have enacted patient confidentiality laws that protect
    against the unauthorized disclosure of confidential medical
    information, and many states have adopted or are considering
    further legislation in this area, including privacy safeguards,
    security standards and data security breach notification
    requirements. Such state laws, if more stringent than HIPAA
    requirements, are not preempted by the federal requirements, and
    we must comply with them even though they may be subject to
    different interpretations by various courts and other
    governmental authorities.
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Other Requirements.</I></B>&#160;&#160;In addition to
    HIPAA, numerous other state and federal laws govern the
    collection, dissemination, use, access to and confidentiality of
    individually identifiable health and other information and
    healthcare provider information. The FTC has issued and several
    states have issued
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    or are considering new regulations to require holders of certain
    types of personally identifiable information to implement formal
    policies and programs to prevent, detect and mitigate the risk
    of identity theft and other unauthorized access to or use of
    such information. Further, the U.S.&#160;Congress and a number
    of states have considered or are considering prohibitions or
    limitations on the disclosure of medical or other information to
    individuals or entities located outside of the United States.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Government
    Regulation of Reimbursement</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our customers are subject to regulation by a number of
    governmental agencies, including those that administer the
    Medicare and Medicaid programs. Accordingly, our customers are
    sensitive to legislative and regulatory changes in, and
    limitations on, the government healthcare programs and changes
    in reimbursement policies, processes and payment rates. During
    recent years, there have been numerous federal legislative and
    administrative actions that have affected government programs,
    including adjustments that have reduced or increased payments to
    physicians and other healthcare providers and adjustments that
    have affected the complexity of our work. It is possible that
    the federal or state governments will implement future
    reductions, increases or changes in reimbursement under
    government programs that adversely affect our customer base or
    our cost of providing our services. Any such changes could
    adversely affect our own financial condition by reducing the
    reimbursement rates of our customers.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Fraud and
    Abuse Laws</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    A number of federal and state laws, generally referred to as
    fraud and abuse laws, are used to prosecute healthcare
    providers, physicians and others that make, offer, seek or
    receive referrals or payments for products or services that may
    be paid for through any federal or state healthcare program and
    in some instances any private program. Given the breadth of
    these laws and regulations, they are potentially applicable to
    our business. These laws and regulations include:
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Anti-Kickback Laws.</I></B>&#160;&#160;There are numerous
    federal and state laws that govern patient referrals, physician
    financial relationships, and inducements to healthcare providers
    and patients. The federal healthcare anti-kickback law prohibits
    any person or entity from offering, paying, soliciting or
    receiving anything of value, directly or indirectly, for the
    referral of patients covered by Medicare, Medicaid and other
    federal healthcare programs or the leasing, purchasing, ordering
    or arranging for or recommending the lease, purchase or order of
    any item, good, facility or service covered by these programs.
    Courts have construed this anti-kickback law to mean that a
    financial arrangement may violate this law if any one of the
    purposes of an arrangement is to encourage patient referrals or
    other federal healthcare program business, regardless of whether
    there are other legitimate purposes for the arrangement. There
    are several limited exclusions known as safe harbors that may
    protect some arrangements from enforcement penalties. These safe
    harbors have very limited application. Penalties for federal
    anti-kickback violations can be severe, and include
    imprisonment, criminal fines, civil money penalties with triple
    damages and exclusion from participation in federal healthcare
    programs. Many states have similar anti-kickback laws, some of
    which are not limited to items or services for which payment is
    made by a federal healthcare program.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>False or Fraudulent Claim Laws.</I></B>&#160;&#160;There
    are numerous federal and state laws that forbid submission of
    false information or the failure to disclose information in
    connection with the submission and payment of physician claims
    for reimbursement. In some cases, these laws also forbid abuse
    of existing systems for such submission and payment, for
    example, by systematic over treatment or duplicate billing of
    the same services to collect increased or duplicate payments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In particular, the federal False Claims Act, or FCA, prohibits a
    person from knowingly presenting or causing to be presented a
    false or fraudulent claim for payment or approval by an officer,
    employee or agent of the United States. In addition, the FCA
    prohibits a person from knowingly making, using, or causing to
    be made or used a false record or statement material to such a
    claim. The FCA was
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    amended on May&#160;20, 2009 by the Fraud Enforcement and
    Recovery Act of 2009, or FERA. Following the FERA amendments,
    the FCA&#146;s &#147;reverse false claim&#148; provision also
    creates liability for persons who knowingly and improperly
    conceal the retention of an overpayment of government money.
    Violations of the FCA may result in treble damages, significant
    monetary penalties, and other collateral consequences including,
    potentially, exclusion from participation in federally funded
    health care programs. The scope and implications of the FERA
    amendments have yet to be fully determined or adjudicated and as
    a result it is difficult to predict how future enforcement
    initiatives may impact our business.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In addition, under the Civil Monetary Penalty Act of 1981, the
    Department of Health and Human Services Office of Inspector
    General has the authority to impose administrative penalties and
    assessments against any person, including an organization or
    other entity, who knowingly presents, or causes to be presented,
    to a state or federal government employee or agent certain false
    or otherwise improper claims.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Stark Law and Similar State Laws.</I></B>&#160;&#160;The
    Ethics in Patient Referrals Act, known as the Stark Law,
    prohibits certain types of referral arrangements between
    physicians and healthcare entities. Physicians are prohibited
    from referring patients for certain designated health services
    reimbursed under federally-funded programs to entities with
    which they or their immediate family members have a financial
    relationship or an ownership interest, unless such referrals
    fall within a specific exception. Violations of the statute can
    result in civil monetary penalties
    <FONT style="white-space: nowrap">and/or</FONT>
    exclusion from the Medicare and Medicaid programs. Furthermore,
    reimbursement claims for care rendered under forbidden referrals
    may be deemed false or fraudulent, resulting in liability under
    other fraud and abuse laws.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Laws in many states similarly forbid billing based on referrals
    between individuals
    <FONT style="white-space: nowrap">and/or</FONT>
    entities that have various financial, ownership or other
    business relationships. These laws vary widely from state to
    state.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Laws Limiting
    Assignment of Reimbursement Claims</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Various federal and state laws, including Medicare and Medicaid,
    forbid or limit assignments of claims for reimbursement from
    government funded programs. Some of these laws limit the manner
    in which business service companies may handle payments for such
    claims and prevent such companies from charging their provider
    customers on the basis of a percentage of collections or
    charges. We do not believe that the services we provide our
    customers result in an assignment of claims for the Medicare or
    Medicaid reimbursements for purposes of federal health care
    programs. Any determination to the contrary, however, could
    adversely affect our ability to be paid for the services we
    provide to our customers, require us to restructure the manner
    in which we are paid, or have further regulatory consequences.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Emergency
    Medical Treatment and Active Labor Act</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The federal Emergency Medical Treatment and Active Labor Act, or
    EMTALA, was adopted by the U.S.&#160;Congress in response to
    reports of a widespread hospital emergency room practice of
    &#147;patient dumping&#148;. At the time of EMTALA&#146;s
    enactment, patient dumping was considered to have occurred when
    a hospital capable of providing the needed care sent a patient
    to another facility or simply turned the patient away based on
    such patient&#146;s inability to pay for his or her care. EMTALA
    imposes requirements as to the care that must be provided to
    anyone who seeks care at facilities providing emergency medical
    services. In addition, the Centers for Medicare and Medicaid
    Services of the U.S.&#160;Department of Health and Human
    Services, has issued final regulations clarifying those areas
    within a hospital system that must provide emergency treatment,
    procedures to meet on-call requirements, as well as other
    requirements under EMTALA. Sanctions for failing to fulfill
    these requirements include exclusion from participation in the
    Medicare and Medicaid programs and civil monetary penalties. In
    addition, the law creates private civil remedies that enable an
    individual who suffers personal harm as a direct result of a
    violation of the law to sue the offending hospital for
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    damages and equitable relief. A hospital that suffers a
    financial loss as a direct result of another participating
    hospital&#146;s violation of the law also has a similar right.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    EMTALA generally applies to our customers, and we assist our
    customers with the intake of their patients. Although we believe
    that our patient intake practices are in compliance with the law
    and applicable regulations, we cannot be certain that
    governmental officials responsible for enforcing the law or
    others will not assert that we are in violation of these laws
    nor what obligations may be imposed by regulations to be issued
    in the future.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Regulation of
    Debt Collection Activities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The federal Fair Debt Collection Practices Act, or FDCPA,
    regulates persons who regularly collect or attempt to collect,
    directly or indirectly, consumer debts owed or asserted to be
    owed to another person. Certain of our accounts receivable
    activities may be subject to the FDCPA. The FDCPA establishes
    specific guidelines and procedures that debt collectors must
    follow in communicating with consumer debtors, including the
    time, place and manner of such communications. Further, it
    prohibits harassment or abuse by debt collectors, including the
    threat of violence or criminal prosecution, obscene language or
    repeated telephone calls made with the intent to abuse or
    harass. The FDCPA also places restrictions on communications
    with individuals other than consumer debtors in connection with
    the collection of any consumer debt and sets forth specific
    procedures to be followed when communicating with such third
    parties for purposes of obtaining location information about the
    consumer. In addition, the FDCPA contains various notice and
    disclosure requirements and prohibits unfair or misleading
    representations by debt collectors. Finally, the FDCPA imposes
    certain limitations on lawsuits to collect debts against
    consumers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Debt collection activities are also regulated at state level.
    Most states have laws regulating debt collection activities in
    ways that are similar to, and in some cases more stringent than,
    the FDCPA. In addition, some states require debt collection
    companies to be licensed. In all states where we operate, we
    believe that we currently hold all required state licenses or
    are exempt from licensing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We are also subject to the Fair Credit Reporting Act, or FCRA,
    which regulates consumer credit reporting and which may impose
    liability on us to the extent that the adverse credit
    information reported on a consumer to a credit bureau is false
    or inaccurate. State law, to the extent it is not preempted by
    the FCRA, may also impose restrictions or liability on us with
    respect to reporting adverse credit information.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The FTC has the authority to investigate consumer complaints
    relating to the FDCPA and the FCRA, and to initiate or recommend
    enforcement actions, including actions to seek monetary
    penalties. State officials typically have authority to enforce
    corresponding state laws. In addition, affected consumers may
    bring suits, including class action suits, to seek monetary
    remedies (including statutory damages) for violations of the
    federal and state provisions discussed above.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Regulation of
    Credit Card Activities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We accept payments by credit cards from patients of our
    customers. Various federal and state laws impose privacy and
    information security laws and regulations with respect to the
    use of credit cards. If we fail to comply with these laws and
    regulations or experience a credit card security breach, our
    reputation could be damaged, possibly resulting in lost future
    business, and we could be subjected to additional legal or
    financial risk as a result of non-compliance.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Foreign
    Regulations</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our operations in India are subject to additional regulations by
    the government of India. These include Indian federal and local
    corporation requirements, restrictions on exchange of funds,
    employment-related laws and qualification for tax status.
</DIV>

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    <B><FONT style="font-family: Arial, Helvetica">Intellectual
    Property</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We rely upon a combination of trademark, copyright and trade
    secret laws and contractual terms and conditions to protect our
    intellectual property rights, and have sought patent protection
    for aspects of our key innovations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of June&#160;30, 2009, we have filed four patent
    applications. We do not know, however, whether any of these
    patent applications will result in the issuance of patents or
    whether the examination process will require us to narrow our
    claims. Legal standards relating to the validity, enforceability
    and scope of protection of patents can be uncertain. If any of
    our applications issues as a patent, that patent may be opposed,
    contested, circumvented, designed around by a third party or
    found to be invalid or unenforceable. Our patent applications
    may not issue with the scope of the claims that we seek, if at
    all, or the scope of the claims that may issue may not be
    sufficiently broad to protect our products and technology. Third
    parties may develop technologies that are similar or superior to
    our proprietary technologies, duplicate or otherwise obtain and
    use our proprietary technologies or design around patents owned
    or licensed by us. If our technology is found to infringe any
    patent or other intellectual property right held by a third
    party, we could be prevented from providing our service
    offerings and subject us to significant damage awards.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We rely in some circumstances on trade secrets to protect our
    technology. We control access to and the use of our application
    capabilities through a combination of internal and external
    controls, including contractual protections with employees,
    customers, contractors and business partners. We license some of
    our software through agreements that impose specific
    restrictions on customers&#146; ability to use the software,
    such as prohibiting reverse engineering and limiting the use of
    copies. We also require employees and contractors to sign
    non-disclosure agreements and invention assignment agreements to
    giver us ownership of intellectual property developed in the
    course of working form us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    On occasion, we incorporate third-party commercial or open
    source software products into our technology platform. Although
    we prefer to develop our own technology, we periodically employ
    third-party software in order to simplify our development and
    maintenance efforts, provide a &#147;commodity&#148; capability,
    support our own technology infrastructure or test a new
    capability.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Employees</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of June&#160;30, 2009, we had 1,305&#160;full-time employees,
    including 147 engaged in technology development and deployment.
    None of our employees is represented by a labor union and we
    consider our current employee relations to be good.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our operations employees are required to participate in our
    &#147;operator academy&#148; and &#147;revenue cycle
    academy&#148;, consisting of multiple training sessions each
    year. Our ongoing training and executive learning programs are
    modeled after the practices of companies that we believe have
    reputations for service excellence. In addition, all of our
    employees undergo mandatory HIPAA training.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Pursuant to managed service contracts, we also manage over 6,000
    revenue cycle staff persons who are employed by our customers.
    We have the right to control and direct the work activities of
    these staff persons and are responsible for paying their
    compensation out of the base fees paid to us by our customers,
    but these staff persons are considered employees of our
    customers for all purposes.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Facilities</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of June&#160;30, 2009, our corporate headquarters occupy
    approximately 28,000&#160;square feet in Chicago, Illinois under
    a lease expiring on various dates in 2013 and 2014. We have an
    option to cancel the lease effective November&#160;30, 2011 if
    the landlord is unable, prior to December&#160;31, 2010, to
    provide approximately 22,000&#160;square feet of additional
    office space on an adjacent floor. If the landlord provides this
    additional office space, we are obligated to lease it, and we
    will have the option to concurrently return approximately
    6,500&#160;square feet of office space on a non-adjacent floor.
</DIV>

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    <BR>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Assuming the landlord provides this additional
    22,000&#160;square feet of office space and we do not return the
    6,500&#160;square feet of office space, the lease for all
    50,000&#160;square feet will be extended until ten years and
    90&#160;days after the date we take possession of the additional
    22,000&#160;square feet of office space. In addition, after the
    landlord provides this additional office space, we will have an
    option to lease at least 50% of the rentable space on another
    floor in the same building. We also have rights of first offer
    on other space in the same building.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of June&#160;30, 2009, we also leased facilities in Jupiter,
    Florida; Kalamazoo, Michigan and Cape Girardeau, Missouri; and
    near New Delhi, India. Pursuant to our master services agreement
    with Ascension Health and the managed service contracts between
    us and our customers, we occupy space
    <FONT style="white-space: nowrap">on-site</FONT> at
    all hospitals where we provide our revenue cycle management
    services. We do not pay customers for our use of space provided
    by them. In general, we are not permitted to provide services to
    one customer from another customer&#146;s site.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We believe that our current facilities are sufficient for our
    current needs. We intend to add new facilities or expand
    existing facilities as we add employees or expand our geographic
    markets, and we believe that suitable additional or substitute
    space will be available as needed to accommodate any such
    expansion of our operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Legal
    Proceedings</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    From time to time, we have been and may again become involved in
    legal proceedings or regulatory investigations arising in the
    ordinary course of our business. We are not presently a party to
    any material litigation and we are not aware of any pending or
    threatened litigation against us that could have a material
    adverse effect on our business, operating results, financial
    condition or cash flows.
</DIV>

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    <BR>
    87
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='113'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">MANAGEMENT</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Executive
    Officers and Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our executive officers and directors, their current positions
    and their ages as of June&#160;30, 2009 are set forth below:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="36%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="61%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Name</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Age</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Position(s)</FONT></B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mary A. Tolan
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    49
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Founder, President and Chief Executive Officer, Director
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    John T. Staton
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    48
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Chief Financial Officer and Treasurer
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Etienne H. Deffarges
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    51
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Executive Vice President
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gregory N. Kazarian
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    46
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Senior Vice President, General Counsel and Secretary
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    J. Michael Cline(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    49
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Founder and Chairman of the Board
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Edgar M. Bronfman, Jr.(1)(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    54
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Steven N. Kaplan(2)(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    49
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Denis J. Nayden(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    55
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    George P. Shultz(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    88
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Arthur H. Spiegel,&#160;III(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    70
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mark A. Wolfson(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    56
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Member of compensation committee.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Member of audit committee.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Member of nominating and corporate governance committee.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Mary A. Tolan</I></B>, a founder of Accretive Health, has
    served as our president and chief executive officer and a
    director since November 2003. Prior to joining our company,
    Ms.&#160;Tolan spent 21&#160;years at Accenture Ltd, a leading
    global management consulting, technology services and
    outsourcing company. At Accenture, Ms.&#160;Tolan served in
    several leadership roles, including group chief executive for
    the resources operating group that had approximately
    $2&#160;billion in annual revenue, and as a member of
    Accenture&#146;s executive committee and management committee.
    She serves on the board of trustees of the University of
    Chicago, Loyola University and the Lyric Opera of Chicago.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>John T. Staton </I></B>has served as our chief financial
    officer and treasurer since September 2005. Mr.&#160;Staton was
    with Accenture for 16&#160;years before joining our company.
    From 2004 to 2005, Mr.&#160;Staton led the business consulting
    practice within Accenture&#146;s North American products
    practice. Prior to this role, he was a partner in
    Accenture&#146;s global retail practice. Before joining
    Accenture, Mr.&#160;Staton held positions in General
    Electric&#146;s manufacturing management program and
    Hewlett-Packard&#146;s sales and channel marketing organizations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Etienne H. Deffarges </I></B>has served as our executive
    vice president since April 2004. From 1999 until joining our
    company, Mr.&#160;Deffarges was a partner at Accenture, most
    recently serving as managing partner for its global utilities
    industry group, and as a member of its executive committee.
    Prior to joining Accenture, Mr.&#160;Deffarges spent
    14&#160;years at Booz Allen Hamilton Inc., a strategy and
    technology consulting firm, including serving as a senior
    partner and global practice leader of the energy, chemicals and
    pharmaceuticals practice from 1994 to 1999 and as a member of
    its executive committee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Gregory N. Kazarian </I></B>has served as our senior vice
    president, general counsel and secretary since January 2004.
    Prior to joining our company, Mr.&#160;Kazarian was with the law
    firm Pedersen&#160;&#038; Houpt,&#160;P.C. for 16&#160;years,
    where he handled employment, intellectual property,
    creditors&#146; rights, dispute resolution and outsourcing
    matters.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>J.&#160;Michael Cline</I></B>, a founder of Accretive
    Health, has been a member of our board of directors since August
    2003 and has served as chairman of the board since July 2009.
    Mr.&#160;Cline has served as the founding managing partner of
    Accretive, LLC, a private equity firm, since founding that firm
    in
</DIV>

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    <BR>
    88
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    December 1999. From 1989 to 1999, Mr.&#160;Cline served as a
    general partner of General Atlantic Partners, LLC, a private
    equity firm. Mr.&#160;Cline serves on the boards of several
    privately-held companies. He also serves on the advisory board
    of the Harvard Business School Rock Center for Entrepreneurship,
    on the board of the National Fish and Wildlife Foundation and as
    a trustee of Panthera, an organization devoted to the
    preservation of the world&#146;s wild cat species where he also
    chairs Panthera&#146;s Tigers Forever initiative.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Edgar M. Bronfman,&#160;Jr.</I></B> has been a member of
    our board of directors since October 2006. Mr.&#160;Bronfman has
    served as chairman and chief executive officer of Warner Music
    Group since March 2004. Before joining Warner Music Group,
    Mr.&#160;Bronfman served as chairman and chief executive officer
    of Lexa Partners LLC, a management venture capital group which
    he founded in April 2002. Mr.&#160;Bronfman was vice chairman of
    the board of directors of Vivendi Universal, S.A. from December
    2000 until December 2003 and also served as an executive officer
    of Vivendi Universal from December 2000 until March 2002. Prior
    to the formation of Vivendi Universal, Mr.&#160;Bronfman served
    as president and chief executive officer of The Seagram Company
    Ltd. from June 1994 until December 2000 and as president and
    chief operating officer of Seagram from 1989 until June 1994.
    Mr.&#160;Bronfman is a director of IAC/InterActiveCorp, a
    publicly-held operator of Internet businesses. Mr.&#160;Bronfman
    is also a member of the board of trustees of the New York
    University Medical Center and the board of governors of the
    Joseph H. Lauder Institute of Management and International
    Studies at the University of Pennsylvania. He also is a general
    partner of Accretive, LLC, a private equity firm.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Steven N. Kaplan </I></B>has been a member of our board of
    directors since July 2004. Since 1988, Mr.&#160;Kaplan has
    served as a professor at the University of Chicago Booth School
    of Business, where he currently is the Neubauer Family Professor
    of Entrepreneurship and Finance and serves as the faculty
    director of the Polsky Center for Entrepreneurship.
    Mr.&#160;Kaplan also serves as a director of Morningstar, Inc.,
    a publicly-held provider of independent investment research, and
    on the boards of trustees of the Columbia Acorn Trust and Wanger
    Asset Trust.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Denis J. Nayden </I></B>has been a member of our board of
    directors since October 2003 and served as co-chairman of our
    board until July 2009. Mr.&#160;Nayden has served as a managing
    partner of Oak Hill Capital Management, LLC, a private equity
    firm, since 2003. From 2000 to 2002, he was chairman and chief
    executive officer of GE Capital Corporation, the financing unit
    of General Electric Company, and prior to that had a
    <FONT style="white-space: nowrap">25-year</FONT>
    tenure at General Electric. Mr.&#160;Nayden is a director of
    Genpact Limited, a publicly-held global provider of business
    process services; RSC Holdings, Inc., a publicly-held equipment
    rental provider; Duane Reade Holdings, Inc., a publicly-held
    operator of a drugstore chain in New York City; and several
    privately-held companies. He also serves on the board of
    trustees of the University of Connecticut.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>George P. Shultz </I></B>has been a member of our board of
    directors since April 2005. Mr.&#160;Shultz has had a
    distinguished career in government, academia and business. He
    has served as the Thomas W. and Susan B. Ford Distinguished
    Fellow at the Hoover Institution of Stanford University since
    1991. Mr.&#160;Shultz served as United States Secretary of State
    from 1982 until 1989, chairman of the President&#146;s Economic
    Policy Advisory Board from 1981 until 1982, United States
    Secretary of the Treasury and Chairman of the Council on
    Economic Policy from 1972 until 1974, Director of the Office of
    Management and Budget from 1970 to 1972, and United States
    Secretary of Labor from 1969 until 1970. From 1948 to 1957,
    Mr.&#160;Shultz taught at MIT, taking a year&#146;s leave of
    absence in 1955 to serve as a senior staff economist on the
    President&#146;s Council of Economic Advisors during the
    Eisenhower administration. He then taught from 1957 to 1969 at
    Stanford University and the University of Chicago Graduate
    School of Business, where he also served as Dean for six years.
    From 1974 to 1982, Mr.&#160;Shultz was president and a director
    of Bechtel Group, Inc., a privately-held global leader in
    engineering, construction and project management. Among numerous
    honors, Mr.&#160;Shultz was awarded the Medal of Freedom, the
    nation&#146;s highest civilian honor, in 1989, and holds
    honorary degrees from more than a dozen universities. He also
    chairs the Governor of California&#146;s Economic Advisory Board
    and the J.P.&#160;Morgan Chase International Council; serves as
    Advisory Council Chair of
</DIV>

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    <BR>
    89
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    the Precourt Energy Efficiency Center at Stanford University;
    chairs the MIT Energy Initiative External Advisory Board; and
    serves on the board of directors of Fremont Group, L.L.C., a
    private investment firm.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

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    <B><I>Arthur H. Spiegel,&#160;III </I></B>has been a member of
    our board of directors since October 2003 and served as
    co-chairman of our board until July 2009. Since 2002,
    Mr.&#160;Spiegel has been a private investor. From 1996 until
    2002, Mr.&#160;Spiegel was President of CSC Healthcare Group,
    which offered consulting, system integration, claims processing
    software and business process and IT outsourcing services to the
    healthcare industry. Mr.&#160;Spiegel founded APM Management
    Consultants, a healthcare consulting firm, in 1974 and served as
    its CEO until it was acquired by Computer Science Corporation in
    1996. He serves on the boards of several privately-held
    companies.
</DIV>

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    <B><I>Mark A. Wolfson </I></B>has been a member of our board of
    directors since October 2003. Mr.&#160;Wolfson has served as a
    managing partner of Oak Hill Capital Management, LLC, a private
    equity firm, since 1998, and is a founding managing partner of
    Oak Hill Investment Management, L.P. Mr.&#160;Wolfson has been
    on the faculty of the Stanford University Graduate School of
    Business since 1977, has served as its associate dean, and has
    held the title of consulting professor since 2001. He has been a
    research associate of the National Bureau of Economic Research
    since 1988 and serves on the executive committee of the Stanford
    Institute for Economic Policy Research. Mr.&#160;Wolfson is a
    director of eGain Communications Corporation, a publicly-held
    provider of multi-channel customer service and knowledge
    management software; and Conversus Asset Management, LLC, which
    manages the portfolio of Conversus Capital, L.P., a
    publicly-traded portfolio of third-party private equity funds.
    He is also an advisor to the investment committee of the William
    and Flora Hewlett Foundation.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

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    <B><FONT style="font-family: Arial, Helvetica">Board
    Composition</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our board of directors currently consists of eight members, all
    of whom were elected as directors pursuant to a
    stockholders&#146; agreement that we have entered into with
    holders of our convertible preferred stock. Aspects of the board
    voting arrangements contained in the stockholders&#146;
    agreement will expire on November&#160;15, 2009. Upon the
    closing of this offering, all remaining board voting
    arrangements will terminate and there will be no further
    contractual obligations regarding the election of our directors.
    Our directors hold office until their successors have been
    elected and qualified or until the earlier of their resignation
    or removal. There are no family relationships among any of our
    directors or executive officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In accordance with the terms of our restated certificate of
    incorporation and amended and restated by-laws, our board of
    directors is divided into three classes, each of which consists,
    as nearly as possible, of one-third of the total number of
    directors constituting our entire board of directors and each of
    whose members serve for staggered three-year terms. As a result,
    only one class of our board of directors will be elected each
    year. Upon the expiration of the term of a class of directors,
    directors in that class will be eligible to be elected for a new
    three-year term at the annual meeting of stockholders in the
    year in which their term expires. The members of the classes are
    as follows:
</DIV>

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    <TD align="left">
    the class&#160;I directors are
    Messrs.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    , and their term expires at the annual meeting of stockholders
    to be held in 2010;
</TD>
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    <TD>&nbsp;</TD>
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    <TD align="left">
    the class&#160;II directors are
    Messrs.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    , and their term expires at the annual meeting of stockholders
    to be held in 2011;&#160;and
</TD>
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    the class&#160;III directors are
    Messrs.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    , and their term expires at the annual meeting of stockholders
    to be held in 2012.
</TD>
</TR>

</TABLE>

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    Our restated certificate of incorporation and restated by-laws
    provide that the authorized number of directors may be changed
    only by resolution of the board of directors. Our restated
    certificate of incorporation and restated by-laws also provide
    that our directors may be removed only for cause by the
    affirmative vote of the holders of at least two-thirds of the
    votes that all our stockholders would be entitled to cast in an
    annual election of directors, and that any vacancy on our board
    of directors,
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    including a vacancy resulting from an enlargement of our board
    of directors, may be filled only by vote of a majority of our
    directors then in office.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

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    <B><FONT style="font-family: Arial, Helvetica">Director
    Independence</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Pursuant to the corporate governance listing standards of the
    New York Stock Exchange, a director employed by us cannot be
    deemed to be an &#147;independent director&#148;, and
    consequently Ms.&#160;Tolan is not an independent director. In
    addition, in accordance with the NYSE corporate governance
    listing standards, each other director will qualify as
    &#147;independent&#148; only if our board of directors
    affirmatively determines that he or she has no material
    relationship with us, either directly or as a partner,
    stockholder or officer of an organization that has a
    relationship with us. Ownership of a significant amount of our
    stock, by itself, does not constitute a material relationship.
</DIV>

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    Our board of directors has affirmatively determined that each of
    Messrs.&#160;Bronfman, Cline, Kaplan, Nayden, Shultz, Spiegel
    and Wolfson is &#147;independent&#148; in accordance with
    Section&#160;303A.02(b) of the NYSE Listed Company Manual. In
    making this determination, our board of directors considered the
    percentage of our common stock owned by an entity affiliated
    with Accretive, LLC, of which Mr.&#160;Cline is the founding
    managing partner and Mr.&#160;Bronfman is a general partner, and
    the percentage of our common stock owned by FW Oak Hill
    Accretive Healthcare Investors, L.P., of which
    Messrs.&#160;Nayden and Wolfson are limited partners. Our board
    also considered that Messrs.&#160;Nayden and Wolfson are
    managing partners of Oak Hill Capital Management, LLC, an entity
    associated with FW Oak Hill Accretive Healthcare Investors,
    L.P., and that Mr.&#160;Wolfson is a managing partner of Oak
    Hill Investment Management, L.P., another entity associated with
    FW Oak Hill Accretive Healthcare Investors, L.P., and a Vice
    President and Assistant Secretary of Group VI 31, LLC, the
    general partner of FW Oak Hill Accretive Healthcare Investors,
    L.P. See &#147;Principal and Selling Stockholders&#148;.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    All of the members of the board&#146;s three standing committees
    described below are independent as defined under the rules of
    the New York Stock Exchange.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Board
    Committees</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our board of directors has established an audit committee, a
    compensation committee and a nominating and corporate governance
    committee. Each committee operates under a charter that has been
    approved by our board of directors. Following this offering,
    copies of each committee&#146;s charter will be posted on the
    Investor Relations section of our website.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Audit
    Committee</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The members of our audit committee are Messrs.&#160;Kaplan
    (chair) and Wolfson. Our board of directors has determined that
    each of the members of our audit committee satisfy the
    requirements for financial literacy under the current
    requirements of the New York Stock Exchange and rules and
    regulations. Prior to the closing of this offering, we intend to
    appoint a third member to our audit committee, who will replace
    Mr.&#160;Kaplan as chair, to be an &#147;audit committee
    financial expert&#148;, as defined by SEC rules, and satisfy the
    financial sophistication requirements of the New York Stock
    Exchange. Our audit committee assists our board of directors in
    its oversight of our accounting and financial reporting process
    and the audits of our financial statements.
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The audit committee&#146;s responsibilities include:
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    appointing, evaluating, retaining, terminating the engagement
    of, setting the compensation of and assessing the independence
    of our independent registered public accounting firm;
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    overseeing the work of our independent registered public
    accounting firm, including the receipt and consideration of
    reports from the firm and reviewing with the firm audit
    problems, internal control issues and other accounting and
    financial reporting matters;
</TD>
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    coordinating the board&#146;s oversight of our internal control
    over financial reporting, disclosure controls and procedures,
    code of business conduct and ethics, and internal audit function;
</TD>
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    establishing procedures for the receipt, retention and treatment
    of accounting related complaints and concerns;
</TD>
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    reviewing and discussing with management and our independent
    registered public accounting firm our annual and quarterly
    financial statements and related disclosures;
</TD>
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    periodically meeting separately with our independent registered
    public accounting firm, management and internal auditors;
</TD>
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    discussing generally the type and presentation of information to
    be disclosed in our earnings press releases, as well as
    financial information and earnings guidance provided to
    analysts, rating agencies and others;
</TD>
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    reviewing our policies and procedures for approving and
    ratifying related person transactions, including our related
    person transaction policy;
</TD>
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    establishing policies regarding the hiring of employees or
    former employees of our independent registered public accounting
    firm;
</TD>
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    discussing our policies with respect to risk assessment and risk
    management;
</TD>
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    preparing the audit committee report required by SEC rules;
</TD>
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    in coordination with the compensation committee, evaluating our
    senior financial management;&#160;and
</TD>
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    at least annually, evaluating its own performance.
</TD>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    All audit services to be provided to us and all non-audit
    services, other than de minimis non-audit services, to be
    provided to us by our independent registered public accounting
    firm must be approved in advance by our audit committee.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Compensation
    Committee</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The members of our compensation committee are
    Messrs.&#160;Nayden (chair), Bronfman, Cline and Spiegel. Our
    compensation committee assists our board of directors in the
    discharge of its responsibilities relating to the compensation
    of our executive officers. The compensation committee&#146;s
    responsibilities include:
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    approving corporate goals and objectives relevant to the
    compensation of our chief executive officer, evaluating our
    chief executive officer&#146;s performance in light of those
    goals and objectives and, either as a committee or together with
    the other independent directors (as directed from time to time
    by the board of directors), determining and approving our chief
    executive officer&#146;s compensation;
</TD>
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    reviewing in consultation with our chief executive officer, and
    approving or making recommendations to the board of directors
    with respect to, compensation of our executive officers (other
    than our chief executive officer);
</TD>
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    overseeing the evaluation of our senior executives, in
    consultation with our chief executive officer in the case of all
    senior executives other than the chief executive officer and in
    conjunction with the audit committee in the case of our senior
    financial management;
</TD>
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    reviewing and making recommendations to the board of directors
    with respect to incentive-compensation and equity-based plans
    that are subject to board approval;
</TD>
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    administering our equity incentive plans, including the
    authority to delegate to one or more of our executive officers
    the power to grant options or other stock awards to employees
    who are
</TD>
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    <TD>&nbsp;</TD>
    <TD>
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    not directors or executive officers of our company, but only if
    consistent with the requirements of the applicable plan and law;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reviewing and making recommendations to the board of directors
    with respect to director compensation;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reviewing and discussing with management the compensation
    discussion and analysis required by SEC rules;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    preparing the compensation committee report required by SEC
    rules;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    at least annually, evaluating its own performance.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Nominating and
    Corporate Governance Committee</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The members of our nominating and corporate governance committee
    are Messrs.&#160;Shultz (chair), Bronfman and Kaplan. The
    nominating and corporate governance committee&#146;s
    responsibilities include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    recommending to the board of directors the persons to be
    nominated for election as directors or to fill vacancies on the
    board of directors, and to be appointed to each of the
    board&#146;s committees;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    applying the criteria for selecting directors approved by the
    board, and annually reviewing with the board the requisite
    skills and criteria for new board members as well as the
    composition of the board of directors as a whole;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    developing and recommending to the board corporate governance
    guidelines applicable to our company;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    overseeing an annual evaluation of the board of directors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    at the request of the board of directors, reviewing and making
    recommendations to the board relating to management succession
    planning;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    at least annually, evaluating its own performance.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Compensation
    Committee Interlocks and Insider Participation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    None of our executive officers serves as a member of the board
    of directors or compensation committee, or other committee
    serving an equivalent function, of any entity that has one or
    more executive officers who serve as members of our board of
    directors or our compensation committee. None of the members of
    our compensation committee is an officer or employee of our
    company, nor have they ever been an officer or employee of our
    company.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Corporate
    Governance Guidelines</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to the closing of this offering, our board of directors
    intends to adopt corporate governance guidelines to assist the
    board in the exercise of its duties and responsibilities and to
    serve the best interests of our company and our stockholders.
    Following this offering, a copy of these guidelines will be
    posted on the Investor Relations section of our website. These
    guidelines, which provide a framework for the conduct of the
    board&#146;s business, are expected to provide that:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the board&#146;s principal responsibility is to oversee the
    management of Accretive Health;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    directors have an obligation to become and remain informed about
    our company and business;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    directors are responsible for determining that effective systems
    are in place for periodic and timely reporting to the board on
    important matters concerning our company;
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    93
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    directors are responsible for attending board meetings, meetings
    of committees on which they serve and the annual meeting of
    stockholders;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a majority of the members of the board of directors shall be
    independent directors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each director must limit the number of other public company
    boards on which he or she serves so that he or she is able to
    devote adequate time to his or her duties to Accretive Health,
    including preparing for and attending meetings;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the non-management directors meet in executive session at least
    semi-annually;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    directors have full and free access to officers and employees of
    our company, and the right to hire and consult with independent
    advisors at our expense;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    new directors participate in an orientation program and all
    directors are expected to participate in continuing director
    education on an ongoing basis;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    at least annually, the board of directors and its committees
    will conduct self-evaluations to determine whether they are
    functioning effectively.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Code of Business
    Conduct and Ethics</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to the closing of this offering, our board of directors
    intends to adopt a written code of business conduct and ethics
    that will apply to our directors, officers and employees,
    including our principal executive officer, principal financial
    officer, principal accounting officer or controller, or persons
    performing similar functions. Following this offering, a copy of
    the code of business conduct and ethics will be posted on the
    Investor Relations section of our website.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Director
    Compensation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Since our company was formed, we have not paid cash compensation
    to any director for his or her service as a director. However,
    non-employee directors are reimbursed for reasonable travel and
    other expenses incurred in connection with attending our board
    and committee meetings.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In the past, we have granted restricted stock and options to
    purchase shares of our common stock to our non-employee
    directors who are not affiliated with our 5% stockholders. We
    did not grant any restricted stock or options to purchase shares
    of our common stock to our non-employee directors during our
    fiscal year ended December&#160;31, 2008. Ms.&#160;Tolan has
    never received any compensation in connection with her service
    as a director.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth information regarding
    compensation earned by our non-employee directors during 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="60%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="13%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="18%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Stock Awards<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Total<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Name</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B><FONT style="font-size: 10pt">($)(1)</FONT></B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B><FONT style="font-size: 10pt">Compensation&#160;($)</FONT></B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    J. Michael Cline
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Edgar M. Bronfman, Jr.&#160;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Steven N. Kaplan
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Denis J. Nayden
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    George P. Shultz
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    23,175
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    23,175
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Arthur H. Spiegel
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mark A. Wolfson
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Valuation of this award is based on the dollar amount of
    share-based compensation expense that we recognized for
    financial statement reporting purposes in 2008 computed in
    accordance with SFAS&#160;123(R). This amount does not represent
    the actual amounts paid to or realized by the director during
    2008. The assumptions used by us with respect to the valuation
    of this award are the same as those set forth in Note&#160;10 to
    our financial statements included elsewhere in this prospectus.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    94
</DIV><!-- END PAGE WIDTH -->
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    Upon the closing of this offering, we intend to implement a
    director compensation plan to provide non-employee directors
    with appropriate cash and equity compensation for service on the
    board of directors and committees of the board of directors. The
    amount of this compensation has not been determined, but we
    anticipate that it will be consistent with amounts paid by
    comparable public companies.
</DIV>

<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Executive
    Compensation</FONT></B>
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Compensation
    Discussion and Analysis</FONT></I></B>
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    This section discusses the principles underlying our executive
    compensation policies and decisions and the most important
    factors relevant to an analysis of these policies and decisions.
    It provides qualitative information regarding the manner and
    context in which compensation is awarded to and earned by our
    executives and is intended to place in perspective the data
    presented in the tables and narrative that follow.
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As we have prepared to become a public company, our compensation
    committee has begun a thorough review of all elements of our
    executive compensation program, including the function and
    design of our annual cash incentive and equity incentive
    programs. The compensation committee has begun, and expects to
    continue in the coming months, to evaluate the need for
    revisions to our executive compensation program to ensure our
    program is competitive with the companies with which we compete
    for superior executive talent. As part of this process, the
    compensation committee is considering the competitiveness of the
    elements of the compensation packages we offer to our
    executives, as well as their total compensation packages.
</DIV>

<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Overview of
    Executive Compensation Process</FONT></I></B>
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Roles of Our Board, Compensation Committee and Chief
    Executive Officer in Compensation
    Decisions.</I></B>&#160;&#160;Our compensation committee
    oversees our executive compensation program, and has done so
    historically. In this role, the compensation committee has
    reviewed all compensation decisions relating to our executive
    officers and has made recommendations to the board. Our chief
    executive officer annually reviews the performance of each of
    our other executive officers, and, based on these reviews,
    provides recommendations to the committee and the board with
    respect to salary adjustments, annual cash incentive bonus
    targets and awards and equity incentive awards. Our compensation
    committee meets with our chief executive officer annually to
    discuss and review her recommendations regarding executive
    compensation for our executive officers, excluding herself.
    These recommendations are forwarded to the board, which
    typically meets in executive session to discuss those
    recommendations and to consider the compensation of the chief
    executive officer. Our chief executive officer is not present
    for board or committee discussions regarding her compensation.
    Our chief executive officer may grant options to executive
    officers other than herself and determine the number of shares
    covered by, and the timing of, option grants. The board has, and
    it exercises, the ability to materially increase or decrease
    amounts of compensation payable to our executive officers
    pursuant to recommendations made by our chief executive officer.
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Competitive Market Data and Use of Compensation
    Consultants.</I></B>&#160;&#160;Historically, our compensation
    committee has not formally benchmarked our executive
    compensation against compensation data, but rather has relied on
    its members&#146; business judgment and collective experience,
    including in the healthcare and consulting industries. As part
    of our preparation to become a public company, in August 2009
    our compensation committee engaged an independent compensation
    consulting firm to provide advice regarding our executive
    compensation program and general information regarding executive
    compensation practices in our industry. Although the
    compensation committee and board consider the compensation
    consulting firm&#146;s advice in considering our executive
    compensation program, the compensation committee and board
    ultimately make their own decisions about these matters.
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    At the compensation committee&#146;s request, the independent
    compensation consulting firm has conducted a number of
    compensation analyses to provide information regarding
    competitive pay and practices for executives of technology,
    business process outsourcing and healthcare services
</DIV>

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    <BR>
    95
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    companies comparable to us in terms of revenue and growth rate,
    <FONT style="white-space: nowrap">and/or</FONT> which
    are anticipated to be comparable to us in terms of market
    capitalization. This peer group, which will be periodically
    reviewed and updated by the compensation committee, consists of:
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="33%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="31%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="31%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Akamai Technologies
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Genpact
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Metavente
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Athenahealth
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Global Payments
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Nuance Communications
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Blackboard
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    HLTH Corp
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Quality Systems
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cerner
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Huron Consulting
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    salesforce.com
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cognizant Tech Solutions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    MAXIMUS
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    SXC Health Solutions
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Eclipsys
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    MedAssets
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    WNS Holdings
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Although the board and compensation committee may consider peer
    group data, to date, they have not benchmarked total executive
    compensation or most compensation elements against this peer
    group, and they do not aim to set total compensation, or any
    compensation element, at a specified level as compared to the
    companies in our peer group.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Objectives and
    Philosophy of Our Executive Compensation Program</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our primary objective with respect to executive compensation is
    to attract, retain and motivate highly talented individuals who
    have the breadth and experience to successfully execute our
    business strategy. Our executive compensation program is
    designed to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reward the achievement of our annual and long-term operating and
    strategic goals;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    recognize individual contributions;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    align the interests of our executives with those of our
    stockholders by rewarding performance that meets or exceeds
    established goals, with the ultimate objective of increasing
    stockholder value.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    To achieve these objectives, our executive compensation program
    ties a portion of each executive&#146;s overall compensation to
    key corporate financial goals, primarily adjusted EBITDA
    targets, as well as to individual performance. We also provide a
    portion of our executive compensation in the form of equity
    incentive awards that vest over time, which we believe helps to
    retain our executive officers and aligns their interests with
    those of our stockholders by allowing them to participate in our
    long-term performance as reflected in the trading price of
    shares of our common stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: Arial, Helvetica">Elements of Our
    Executive Compensation Program</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The primary elements of our executive compensation program are:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    base salaries;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    annual cash incentive bonuses;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    equity incentive awards;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    other employee benefits.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our compensation committee has not adopted any formal or
    informal policies or guidelines for allocating compensation
    between these elements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Base Salaries.</I></B>&#160;&#160;We use competitive base
    salary to attract and retain qualified candidates to help us
    achieve our growth and performance goals. Base salaries are
    intended to recognize an executive officer&#146;s immediate
    contribution to our organization, as well as his or her
    experience, knowledge and responsibilities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    From time to time, in its discretion, our compensation committee
    and board evaluate and adjust executive officer base salary
    levels based on factors determined to be relevant, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the executive officer&#146;s skills and experience;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the particular importance of the executive officer&#146;s
    position to us;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the executive officer&#146;s individual performance;
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    96
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the executive officer&#146;s growth in his or her position;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    market level increases;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    base salaries for comparable positions within our
    company;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    inflation rates.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our compensation committee and board historically have
    considered annual base salary adjustments in the first quarter
    of the year. From 2004 through 2007, we did not increase the
    base salary of any of our executive officers, other than a
    nominal increase in 2007 to reflect the rate of inflation. In
    the first quarter of 2008, our board increased our executive
    officers&#146; (other than our chief financial officer) base
    salaries by 25% over their original base salaries, because until
    such time, they had not received increases commensurate with
    their significant contributions to the development of our
    business in its early stages. In light of general economic
    conditions in the first quarter of 2009, and despite our strong
    performance in 2008, we did not increase any executive
    officer&#146;s base salary for 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Annual Cash Incentive Bonuses.</I></B>&#160;&#160;We
    maintain an annual cash incentive bonus program in which each of
    our executive officers participates. These annual cash incentive
    bonuses are intended to compensate our executive officers for
    our achievement of corporate financial goals, primarily adjusted
    EBITDA targets, as well as individual performance in the areas
    of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    economic and financial contributions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    operations;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    customer satisfaction;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    business development;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    organizational and leadership development.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our annual cash incentive bonuses have varied from year to year,
    and we expect that they will continue to vary, depending on
    actual corporate and individual performance results.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Historically, our board has set our corporate financial goals
    and our executive officers&#146; individual cash incentive bonus
    targets each year in advance. However, during the course of the
    year, the board and our compensation committee, based on
    recommendations of our chief executive officer (with respect to
    our other executive officers), may adjust such goals as they
    deem appropriate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Historically, our board has worked with our chief executive
    officer to develop aggressive goals to be achieved by the
    company and our executive officers. The goals established by the
    board have been based on our historical operating results and
    growth rates, as well as our expected future results, and are
    designed to require significant effort and operational success
    on the part of our executive officers and the company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The board has historically set each executive officer&#146;s
    target annual cash incentive bonus level at the higher of the
    executive&#146;s prior year actual bonus and his or her prior
    year target bonus. The board believes that this approach
    supports our pay-for-performance philosophy and encourages the
    achievement of growth and performance goals. The board approves
    actual annual cash incentive bonuses, based on the
    recommendations of our compensation committee, with input from
    our chief executive officer in the case of executive officers
    other than herself. There are no minimum or maximum payout
    levels, and our board has broad discretion to make adjustments
    to the awards.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    For the year ended December&#160;31, 2008, our corporate
    financial goals were based on adjusted EBITDA. Our compensation
    committee believes that adjusted EBITDA is an appropriate
    measure of our business performance because it emphasizes the
    addition of new customers and expansion of services with
    existing customers, as well as improvements in our operating
    efficiency, and it is reflective of stockholder value creation.
    In 2008, we exceeded our adjusted EBITDA target by
    $1.5&#160;million, and our actual adjusted EBITDA was
    $12.2&#160;million.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    97
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    For the years ended December&#160;31, 2008 and 2009, each
    executive officer&#146;s target bonus awards as a percentage of
    his or her base salary were set as follows:
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="76%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="4%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Target Annual<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Cash Incentive<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Bonus</B>
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Executive Officer</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2009</FONT></B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Chief Executive Officer
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    450,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    600,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Chief Financial Officer
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    183,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    258,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Executive Vice President
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    346,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    446,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Senior Vice President and General Counsel
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    127,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    202,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Because our adjusted EBITDA for the year ended December&#160;31,
    2008 exceeded our goal, our board exercised its discretion to
    increase our executive officers&#146; annual cash incentive
    bonuses above the targets. For the actual 2008 amounts that we
    paid to each executive officer under our annual cash incentive
    bonus program, see the Summary Compensation Table below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our board uses our unaudited financial results to make financial
    target performance determinations under our annual cash
    incentive bonus program, and those results may be adjusted in
    connection with the preparation of our audited consolidated
    financial statements. You should read our consolidated financial
    statements, the related notes to these financial statements and
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations&#148; included elsewhere in
    this prospectus. As described above, the purpose of these
    targets was to establish a method for determining the payment of
    cash incentive bonuses. You are cautioned not to rely on these
    performance goals as a prediction of our future performance.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    From time to time, we may make special cash bonus awards to our
    employees, including our executive officers. In July 2008 and
    August 2009, we determined to award special cash bonuses of
    approximately $81,000 and $143,000, respectively, to our chief
    financial officer contemporaneously with the cash dividend we
    declared on all outstanding capital stock in each of those
    years. Each of our executive officers, other than our chief
    financial officer, received an award of common stock, rather
    than stock options, in connection with his or her employment,
    and accordingly, participates in the cash dividends. Our chief
    financial officer received a stock option award, which remains
    outstanding, in connection with his employment and, accordingly,
    is not entitled to participate in cash dividends. We believe the
    contributions to our business made by our chief financial
    officer are on par with those made by our other executive
    officers and, accordingly, our board determined to award him
    these special cash bonuses, each of which represents the payment
    he would have received as a cash dividend had he owned such
    number of shares equal to the vested portion of his option on
    the record date for the applicable dividend.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Equity Incentive Awards.</I></B>&#160;&#160;Our equity
    incentive award program is the primary vehicle for offering
    long-term incentives to our executive officers. To date, equity
    incentive awards to our executive officers have been made in the
    form of restricted stock awards and stock options, and our
    compensation committee currently intends to continue this
    practice. Although we do not have any equity ownership
    guidelines or requirements for our executive officers, we
    believe that equity incentive awards:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide our executive officers with a strong link to our
    long-term performance, including by enhancing their
    accountability for long-term decision making;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    help balance the short-term orientation of our annual cash
    incentive bonus program;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    create an ownership culture by aligning the interests of our
    executive officers with the creation of value for our
    stockholders;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    further our goal of executive retention.
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    98
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Employees who are considered essential to our long-term success
    are eligible to receive equity incentive awards, which typically
    vest over four years. As of September&#160;1, 2009, all equity
    incentive awards granted to our executive officers had fully
    vested. Accordingly, in connection with its evaluation of the
    need for revisions to our executive compensation program, our
    compensation committee intends to make additional equity
    incentive awards to our executive officers in the near future.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In determining the size of equity incentive awards to executive
    officers, our compensation committee generally considers the
    executive&#146;s experience, skills, level and scope of
    responsibilities and internal comparisons to other comparable
    positions in our company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Other Employee Benefits.</I></B>&#160;&#160;We maintain
    broad-based benefits that are provided to all employees,
    including our 401(k) retirement plan, flexible spending
    accounts, a medical care plan, vacation and standard company
    holidays. Our executive officers are eligible to participate in
    each of these programs on the same terms as non-executive
    employees; however, we do not provide a matching 401(k)
    contribution for any of our executive officers. See
    &#147;&#151;&#160;401(k) Retirement Plan&#148; for more
    information regarding our 401(k) retirement plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We also provide for each of our chief executive officer, chief
    financial officer and executive vice president supplemental
    disability income protection that provides income replacement in
    the event of a qualifying disability.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Severance and Change of Control
    Arrangements.</I></B>&#160;&#160;We have an employment agreement
    with our chief executive officer that provides a combination of
    &#147;single trigger&#148; and &#147;double trigger&#148;
    benefits in connection with a change of control of our company
    <FONT style="white-space: nowrap">and/or</FONT>
    termination of her employment. We believe a combination of
    &#147;single trigger&#148; and &#147;double trigger&#148;
    vesting along with severance payments maximizes stockholder
    value because it limits any unintended windfalls to executives
    in the event of a friendly change of control, while still
    providing executives appropriate incentives to cooperate in
    negotiating any change of control, including a change of control
    in which they believe they may lose their jobs. We also have an
    employment agreement with our chief financial officer and an
    offer letter with our general counsel, each of which provides
    for specified salary continuation, and in the case of our chief
    financial officer, benefits continuation, in the event of
    specified employment terminations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    See &#147;&#151;&#160;Potential Payments upon Termination or
    Change in Control&#148; and &#147;Employment Agreements&#148;
    for a more detailed description of these arrangements.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Deductibility
    of Executive Compensation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Section&#160;162(m) of the Internal Revenue Code, which will
    become applicable to us upon the closing of this offering,
    generally disallows a tax deduction for compensation in excess
    of $1.0&#160;million paid to our chief executive officer and our
    four other most highly paid executive officers, except our chief
    financial officer. Qualifying performance-based compensation is
    not subject to the deduction limitation if specified
    requirements are met. We periodically review the potential
    consequences of Section&#160;162(m) and we generally intend to
    structure the performance-based portion of our executive
    compensation, where feasible, to comply with exemptions in
    Section&#160;162(m) so that the compensation remains tax
    deductible to us. However, our board or compensation committee
    may, in their judgment, authorize compensation payments that are
    not exempt under Section&#160;162(m) when they believe that such
    payments are appropriate to attract and retain executive talent.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    99
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Summary
    Compensation Table</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth information regarding
    compensation earned by our chief executive officer, our chief
    financial officer and our two other executive officers during
    our fiscal year ended December&#160;31, 2008. We refer to these
    individuals as our named executive officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="36%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=08 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=08 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=08 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=08 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Non-Equity<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Incentive Plan<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>All Other<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
    <B>Name and<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Salary<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Bonus<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Awards<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Option<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Compensation<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Compensation<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Total<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Principal Position</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>($)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>($)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>($)(1)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Awards ($)(1)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>($)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>($)(2)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>($)</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Mary A. Tolan
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    515,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    150,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    450,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    8,760
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,123,760
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <I>Founder, President and Chief Executive Officer(3)</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    John T. Staton
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    321,360
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    156,099
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    133,632
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    183,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,049
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    800,140
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <I>Chief Financial Officer and Treasurer</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Etienne H. Deffarges
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    437,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,244
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    346,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,753
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    899,015
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <I>Executive Vice President</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Gregory N. Kazarian
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    281,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    75,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    127,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    483,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    <I>Senior Vice President, General Counsel and Secretary</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 8pt">(1)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 8pt">Valuation of these option awards is
    based on the dollar amount of share-based compensation expense
    that we recognized for financial statement reporting purposes in
    2008 computed in accordance with SFAS 123(R), excluding the
    impact of estimated forfeitures related to service-based vesting
    conditions. These amounts do not represent the actual amounts
    paid to or realized by the named executive officer during 2008.
    The assumptions used by us with respect to the valuation of
    option awards are the same as those set forth in Note&#160;10 to
    our financial statements included elsewhere in this prospectus.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 8pt">(2)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 8pt">Amounts represent long-term
    disability insurance premiums paid by us on behalf of each of
    the named executive officers.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 8pt">(3)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 8pt">Ms.&#160;Tolan is also a member of
    our board of directors but does not receive any additional
    compensation in her capacity as a director.
    </FONT></TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Grants of
    Plan-Based Awards in 2008</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth information for 2008 regarding
    grants of compensation in the form of plan-based awards made
    during 2008 to our named executive officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="82%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="14%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Future Payouts<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Under Non-Equity<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Incentive<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Plan Awards<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Target<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)(1)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mary A. Tolan
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    450,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    John T. Staton
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    183,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Etienne H. Deffarges
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    346,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gregory N. Kazarian
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    127,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 8pt">(1)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 8pt">Annual cash incentive bonuses paid
    under the annual cash incentive bonus program for 2008 are also
    disclosed in the &#147;Summary Compensation Table.&#148;
    </FONT></TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    100
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Outstanding
    Equity Awards at Year End</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth information regarding outstanding
    stock options held by our named executive officers as of
    December&#160;31, 2008. We did not grant any equity awards to
    our named executive officers during 2008, none of our executive
    officers exercised any stock options and no restricted stock
    awards held by our named executive officers became vested during
    2008, other than 48,611&#160;shares of restricted common stock
    held by Mr.&#160;Deffarges, which vested in full in 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="32%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="19" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Option Awards</B>
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Equity Incentive<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Plan Awards:</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Securities<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Securities<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Securities<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Underlying<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Underlying<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Underlying<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Unexercised<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Unexercised<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Unexercised<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Option<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Options<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Options<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Unearned<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Option<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(#)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(#)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Options<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Price<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Expiration<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Name</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Exercisable</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Unexercisable</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">(#)</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">($)</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Date</FONT></B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Mary A. Tolan
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    John T. Staton
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    199,295
</TD>
<TD nowrap align="left" valign="bottom">
    (1)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.01
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8/31/2015
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Etienne H. Deffarges
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Gregory N. Kazarian
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 8pt">(1)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 8pt">This stock option was immediately
    exercisable upon grant, and as of December&#160;31, 2008, was
    vested as to 149,413, and unvested as to 49,882, shares of
    common stock. Unvested shares of common stock issued upon
    exercise of an option remain subject to our right of repurchase
    upon termination and to restrictions on transfer. This stock
    option vested in equal monthly installments and was fully vested
    as of September&#160;1, 2009.
    </FONT></TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Potential
    Payments Upon Termination or Change of Control</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The table below summarizes the potential payments to each of our
    named executive officers if he or she were to be terminated on
    December&#160;31, 2008 under the circumstances described in the
    footnotes below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="53%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Severance<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Medical/Welfare<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Name</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Payments(1)</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Benefits(2)</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Total Benefits</FONT></B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mary A. Tolan
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    515,000
</TD>
<TD nowrap align="left" valign="bottom">
    (3)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    515,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    John T. Staton
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    599,994
</TD>
<TD nowrap align="left" valign="bottom">
    (4)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    18,252
</TD>
<TD nowrap align="left" valign="bottom">
    (4)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    618,246
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Etienne H. Deffarges
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gregory N. Kazarian
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    281,250
</TD>
<TD nowrap align="left" valign="bottom">
    (5)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    281,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Amounts subject to a reduction for compensation earned by the
    named executive officer from any new employment during the
    severance period.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Calculated based on the estimated cost to us of providing these
    benefits.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents amounts payable for termination due to death or
    &#147;disability&#148; or termination without &#147;cause&#148;
    or for &#147;good reason&#148; pursuant to the employment
    agreement described below.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (4) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents amounts payable for termination without
    &#147;cause&#148; or for &#147;good reason&#148; pursuant to the
    employment agreement described below.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (5) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents amounts payable for termination without
    &#147;cause&#148; pursuant to the offer letter described below.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Employment
    Agreements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Mary A. Tolan.</I></B>&#160;&#160;We entered into an
    at-will employment agreement with Mary A. Tolan, our president
    and chief executive officer, effective January 2004. Pursuant to
    the agreement, Ms.&#160;Tolan is entitled to an annual base
    salary of at least $400,000, subject to adjustment by our board
    of directors. Ms.&#160;Tolan&#146;s annual base salary is
    currently $515,000. Pursuant to the agreement, Ms.&#160;Tolan
    earned a
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    101
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    one-time cash performance bonus of $200,000 based on customer
    procurement during 2004 consistent with our business plan.
    Pursuant to the agreement, in March 2004, our board of directors
    granted Ms.&#160;Tolan 3,000,000&#160;shares of restricted
    stock, which vested in equal monthly installments over four
    years ending November 2007.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    If Ms.&#160;Tolan&#146;s employment is terminated due to her
    death or &#147;disability&#148;, if we terminate
    Ms.&#160;Tolan&#146;s employment without &#147;cause&#148; or if
    Ms.&#160;Tolan terminates her employment for &#147;good
    reason&#148;, as those terms are defined in her employment
    agreement, (1)&#160;Ms.&#160;Tolan will be entitled to receive
    her base salary paid in accordance with our payroll practices
    during the 12&#160;months following such termination, subject to
    a reduction for any compensation she earns from any new
    employment during the severance period, and
    (2)&#160;Ms.&#160;Tolan&#146;s outstanding stock-based awards
    will continue to vest until the earlier of 12&#160;months
    following her termination or the end of the applicable
    award&#146;s vesting period. In the event of a &#147;change in
    control&#148;, as such term is defined in her employment
    agreement, 50% of all unvested shares of Ms.&#160;Tolan&#146;s
    stock-based awards will accelerate and vest in full as of the
    effective date of the &#147;change in control&#148;. If
    Ms.&#160;Tolan&#146;s employment is terminated without
    &#147;cause&#148; or if Ms.&#160;Tolan terminates her employment
    for &#147;good reason&#148; within 12&#160;months after a
    &#147;change in control&#148;, the remaining 50% of all unvested
    shares of Ms.&#160;Tolan&#146;s stock-based awards will
    accelerate and vest in full. If Ms.&#160;Tolan is terminated for
    &#147;cause&#148;, she has agreed to execute a limited stock
    power transferring all rights to vote the 3,000,000&#160;shares
    of restricted stock granted to her pursuant to the employment
    agreement to a person we designate in our sole discretion.
    Ms.&#160;Tolan&#146;s employment agreement restricts her from
    engaging in activities competitive with us, soliciting our
    employees and consultants, and diverting business from us for a
    period of 12&#160;months following her termination.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>John T. Staton.</I></B>&#160;&#160;We entered into an
    at-will employment agreement with John T. Staton, our chief
    financial officer and treasurer, effective June 2005. Pursuant
    to the agreement, Mr.&#160;Staton is entitled to an annual base
    salary of at least $300,000, subject to adjustment by our board
    of directors and our chief executive officer.
    Mr.&#160;Staton&#146;s annual base salary is currently $321,360.
    Mr.&#160;Staton is eligible to earn an annual performance bonus
    of up to $100,000 per year, with the full $100,000 guaranteed
    for each of his first two years of employment. Pursuant to the
    agreement, in September 2005, our board of directors granted
    Mr.&#160;Staton an option to purchase 299,295&#160;shares of our
    common stock at an exercise price of $3.01 per share, vesting in
    equal monthly installments over four years ending September 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    If we terminate Mr.&#160;Staton&#146;s employment without
    &#147;cause&#148; or if Mr.&#160;Staton terminates his
    employment for &#147;good reason&#148;, as those terms are
    defined in his employment agreement, Mr.&#160;Staton will be
    entitled to receive $33,333 per month during the 18&#160;months
    following such termination, subject to a reduction for any
    compensation he earns from any new employment during the
    severance period. If Mr.&#160;Staton&#146;s employment is
    terminated without &#147;cause&#148; or if Mr.&#160;Staton
    terminates his employment for &#147;good reason&#148;,
    Mr.&#160;Staton and his family will be entitled to continue to
    participate in our health insurance plan during the
    18&#160;months following termination to the extent of his
    participation prior to termination, and we will pay the premiums
    that we paid prior to termination. Mr.&#160;Staton&#146;s
    employment agreement restricts him from engaging in activities
    competitive with us, soliciting our employees and consultants,
    and diverting business from us for a period of 18&#160;months
    following his termination.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Gregory N. Kazarian.</I></B>&#160;&#160;We entered into an
    offer letter with Gregory N. Kazarian, our senior vice
    president, general counsel and secretary, in December 2003.
    Pursuant to the offer letter, Mr.&#160;Kazarian is entitled to
    an annual base salary of $225,000. Mr.&#160;Kazarian&#146;s
    annual base salary is currently $281,250. Pursuant to the offer
    letter, Mr.&#160;Kazarian earned a one-time cash performance
    bonus of $75,000 based on customer procurement, and was entitled
    to receive an option to purchase shares of our common stock then
    representing 1.5% of our common stock. In lieu of the option, in
    June 2004, our board of directors awarded Mr.&#160;Kazarian
    250,000&#160;shares of common stock, then representing 1.5% of
    our common stock, which vested in equal monthly installments
    over four years ending before January 2008. If we terminate
    Mr.&#160;Kazarian&#146;s employment without cause,
    Mr.&#160;Kazarian will be entitled to receive his current
    monthly base salary during the 12&#160;months following such
    termination, subject to a reduction for any compensation he
    earns from any new employment during the severance period.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    102
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Confidentiality
    and Non-Disclosure Agreements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As a condition to employment, each named executive officer
    entered into a confidentiality and non-disclosure agreement with
    us. Under these agreements, each named executive officer has
    agreed:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    not to solicit our employees and customers during his or her
    employment and for a period of 18&#160;months after the
    termination of employment;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    not to compete with us during his or her employment and for a
    period of 12&#160;months after the termination of employment;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    to protect our confidential and proprietary information;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    to assign to us intellectual property developed during the
    course of his or her employment.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Stock Option and
    Other Compensation Plans</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Amended and
    Restated Stock Option Plan</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our amended and restated stock option plan, which we refer to as
    our prior option plan, was adopted by our board of directors in
    December 2005. The plan was amended and restated in February
    2006 and further amended in May 2007, October 2008 and January
    2009. As of June&#160;30, 2009, a maximum of
    3,544,862&#160;shares of common stock was authorized for
    issuance under our prior option plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of June&#160;30, 2009, there were options to purchase
    2,440,885&#160;shares of common stock outstanding under our
    prior option plan, 930,149&#160;shares of common stock had been
    issued pursuant to the exercise of options granted under this
    plan (of which 892,201&#160;shares were vested) and
    173,828&#160;shares of common stock were available for future
    grants under the plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our prior option plan provides for the grant of options that are
    not intended to qualify as incentive stock options under
    Section&#160;422 of the Internal Revenue Code, which we refer to
    as non-statutory stock options. Our employees, directors and
    outside consultants are eligible to receive options under the
    plan. The plan is administered by the board of directors, our
    compensation committee or another committee designated by the
    board of directors. Subject to limitations specified in the
    plan, the committee or our chief executive officer may grant
    options, select option recipients and determine the number of
    shares covered by, and the timing of, option grants, except that
    our chief executive officer may not grant options to herself.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Unless otherwise prescribed in an option agreement, options
    granted pursuant to our prior option plan vest in equal
    installments on each of the first four anniversaries of the
    grant date. Options under our prior option plan are immediately
    exercisable upon grant, provided that unvested shares of common
    stock issued upon exercise of an option remain subject to our
    right of repurchase upon termination and to restrictions on
    transfer. Subject to the repurchase right, upon exercise of an
    option, a holder has the rights of a stockholder as to both the
    vested and unvested shares. In the event an option holder&#146;s
    employment or service is terminated other than for cause, as
    defined in the plan, the unvested portion of the unexercised
    option shall be forfeited, the vested but unexercised portion of
    the option may be exercised within 60&#160;days and unvested
    shares that were issued upon prior exercises are subject to our
    right of repurchase at a price per share equal to the lesser of
    the option&#146;s exercise price or the fair market value at the
    time of termination. In the event an option holder&#146;s
    employment or service is terminated for cause, the vested but
    unexercised portion of the option is forfeited, vested shares
    that were issued upon prior exercises are subject to our right
    of repurchase at a price per share equal to the option&#146;s
    exercise price, and unvested shares that were issued upon prior
    exercises are subject to our right of repurchase at a price per
    share equal to the lesser of the option&#146;s exercise price or
    the fair market value at the time of termination.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Upon a &#147;change of control&#148;, as defined in the plan,
    all unvested shares issued upon prior exercises of options
    granted under our prior option plan will be accelerated in full
    unless the acquirer replaces the shares with its shares subject
    to the same vesting schedule. If an acquirer of our
</DIV>

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    <BR>
    103
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    company does not accept the assignment of our repurchase rights
    under the prior option plan, the repurchase rights will
    terminate upon the change of control.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our prior option plan restricts option recipients from engaging
    in activities competitive with us, soliciting our employees and
    consultants, and diverting business from us while serving as an
    employee, director or consultant and for periods of 18 to
    24&#160;months after termination of employment or service.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Restricted
    Stock Plan</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our restricted stock plan was adopted by our board of directors
    in March 2004 and amended in June 2004. As of June&#160;30,
    2009, there were 6,599,591&#160;shares of common stock
    outstanding under our restricted stock plan, all of which were
    vested.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our restricted stock plan provides for the grant of restricted
    stock awards. Our employees, directors and outside consultants
    are eligible to receive awards under the plan. The plan is
    administered by the board of directors, our compensation
    committee or another committee designated by the board of
    directors, provided that a majority of the members of such
    committee are directors who are not also our employees. The
    committee may grant awards, select the recipients and timing of
    awards, and determine the number of shares covered by awards.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Shares issued under our restricted stock plan vest on schedules
    specified in the applicable award agreement, ranging from
    immediate vesting to vesting over a period of 48&#160;months.
    Upon termination for cause or without good reason, all unvested
    shares shall be forfeited. Upon termination without cause, for
    good reason, or for death or disability, unvested shares may
    continue to vest for up to 12&#160;months and are subject to
    repurchase by us at the original purchase price therefor.
    Subject to the repurchase provisions, upon grant of an award, a
    holder has the rights of a stockholder as to both the vested and
    unvested shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Upon a &#147;change of control&#148;, as defined in the plan,
    unvested shares are accelerated only to the extent provided in
    the applicable award agreement, employment agreement or other
    agreement.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Omnibus Stock
    Incentive Plan</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to the closing of this offering, we intend to adopt a new
    omnibus stock incentive plan. After the effective date of the
    new stock incentive plan, we anticipate that we will not make
    any further grants of stock options or restricted stock under
    our prior option plan or our restricted stock plan. However, any
    shares of our common stock reserved for issuance under such
    plans that remain available for issuance and any shares of our
    common stock subject to awards under our such plans that expire,
    terminate or are otherwise surrendered, canceled, forfeited or
    repurchased by us will be added to the number of shares
    available under the new omnibus stock incentive plan, up to a
    specified number of shares.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">401(k)
    Retirement Plan</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We maintain a 401(k) retirement plan that is intended to be a
    tax-qualified defined contribution plan under
    Section&#160;401(k) of the Internal Revenue Code. In general,
    all of our employees are eligible to participate. The 401(k)
    plan includes a salary deferral arrangement pursuant to which
    participants may elect to reduce their current compensation by
    up to the statutorily prescribed limit, equal to $16,500 in
    2009, and have the amount of the reduction contributed to the
    401(k) plan. We currently match up to 50% of the first 3% of
    base compensation in 401(k) plan contributions by employees who
    are below the &#147;director level&#148;; as such, our named
    executive offices do not receive a match from the company for
    amounts, if any, deferred under the 401(k) plan.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Limitation of
    Liability and Indemnification</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As permitted by Delaware law, we plan to adopt provisions in our
    restated certificate of incorporation, which will become
    effective upon the closing of this offering, that limit or
    eliminate the personal liability of our directors. Our restated
    certificate of incorporation limits the liability of directors
    to the maximum extent permitted by Delaware law. Delaware law
    provides that directors of a
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    104
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    corporation will not be personally liable for monetary damages
    for breaches of their fiduciary duties as directors, except
    liability for:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any breach of the director&#146;s duty of loyalty to us or our
    stockholders;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any act or omission not in good faith or which involves
    intentional misconduct or a knowing violation of law;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any unlawful payments related to dividends or unlawful stock
    repurchases or redemptions;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any transaction from which the director derived an improper
    personal benefit.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    These limitations do not apply to liabilities arising under
    federal securities laws and do not affect the availability of
    equitable remedies, including injunctive relief or rescission.
    If Delaware law is amended to permit the further elimination or
    limiting of the personal liability of directors, then the
    liability of our directors will be eliminated or limited to the
    fullest extent permitted by Delaware law as so amended.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As permitted by Delaware law, our restated certificate of
    incorporation that will become effective upon the closing of
    this offering also provides that:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we will indemnify our directors and officers to the fullest
    extent permitted by law;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we may indemnify our other employees and other agents to the
    same extent that we indemnify our officers and directors, unless
    otherwise determined by the board of directors;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we will advance expenses to our directors and officers in
    connection with legal proceedings to the fullest extent
    permitted by law.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The indemnification provisions contained in our restated
    certificate of incorporation that will become effective upon the
    closing of this offering are not exclusive. In addition, prior
    to the closing of this offering, we intend to enter into
    indemnification agreements with each of our directors and
    executive officers. Each indemnification agreement is expected
    to provide that we will indemnify the director or executive
    officer to the fullest extent permitted by law for claims
    arising in his or her capacity as our director, officer,
    employee or agent, provided that he or she acted in good faith
    and in a manner that he or she reasonably believed to be in, or
    not opposed to, our best interests and, with respect to any
    criminal proceeding, had no reasonable cause to believe that his
    or her conduct was unlawful. In the event that we do not assume
    the defense of a claim against a director or executive officer,
    we will be required to advance his or her expenses in connection
    with his or her defense, provided that he or she undertakes to
    repay all amounts advanced if it is ultimately determined that
    he or she is not entitled to be indemnified by us. We believe
    that these provisions and agreements are necessary to attract
    and retain qualified persons as directors and executive officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Insofar as indemnification for liabilities arising under the
    Securities Act may be permitted to directors, officers or
    persons controlling our company pursuant to the foregoing
    provisions, we understand that in the opinion of the SEC such
    indemnification is against public policy as expressed in the
    Securities Act and is therefore unenforceable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In addition, we maintain standard policies of insurance under
    which coverage is provided to our directors and officers against
    losses rising from claims made by reason of breach of duty or
    other wrongful act, and to us with respect to payments which may
    be made by us to such directors and officers pursuant to the
    above indemnification provisions or otherwise as a matter of law.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica"><FONT style="white-space: nowrap">Rule&#160;10b5-1</FONT>
    Sales Plans</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our directors and executive officers may adopt written plans,
    known as
    <FONT style="white-space: nowrap">Rule&#160;10b5-1</FONT>
    plans, in which they will contract with a broker to buy or sell
    shares of our common stock on a periodic basis. Under a
    <FONT style="white-space: nowrap">Rule&#160;10b5-1</FONT>
    plan, a broker executes trades pursuant to parameters
    established by the director or officer when entering into the
    plan, without further direction from the director or officer.
    The director or officer may amend or terminate the plan in some
    circumstances. Our directors and executive officers may also buy
    or sell additional shares outside of a
    <FONT style="white-space: nowrap">Rule&#160;10b5-1</FONT>
    plan when they are not in possession of material, nonpublic
    information concerning our company.
</DIV>

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    <BR>
    105
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='114'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">RELATED PERSON
    TRANSACTIONS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Since January&#160;1, 2006, we have engaged in the following
    transactions, other than compensation arrangements, with our
    directors, executive officers and holders of more than 5% of our
    voting securities, and certain affiliates of our directors,
    executive officers and 5% stockholders.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Share
    Exchanges</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Effective as of December&#160;31, 2008, certain of our
    directors, executive officers and their affiliates agreed to
    exchange 2,398,334&#160;shares of our non-voting common stock
    held by them for 2,398,334&#160;shares of our voting common
    stock. To implement these exchanges, we entered into share
    exchange agreements with these persons in February 2009. These
    shares are subject to the terms and conditions set forth in our
    restricted stock plan, the restricted stock award agreements
    entered into with these persons in connection with the original
    issuance of their shares of non-voting common stock and our
    stockholders&#146; agreement pursuant to which these persons
    have certain registration rights. For a more detailed
    description of these registration rights, see &#147;Description
    of Capital Stock&#160;&#151; Registration Rights&#148;. Upon the
    closing of this offering, all other outstanding shares of
    non-voting common stock will be converted into common stock. The
    table below sets forth the number of shares of voting common
    stock issued to our directors, executive officers and their
    affiliates in exchange for an equal number of shares of
    non-voting common stock:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="81%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="8%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Name</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Number of Shares</FONT></B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Etienne H. Deffarges
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,166,667
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Steven N. Kaplan
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    41,667
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gregory N. Kazarian
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    250,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    The Shultz 1989 Family Trust(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    90,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Spiegel Family LLC(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    750,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    John T. Staton Declaration of Trust(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    George P. Shultz, a member of our board of directors, and his
    wife are the beneficiaries of The Shultz 1989 Family Trust.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Arthur H. Spiegel,&#160;III, a member of our board of directors,
    and his wife are the managing members of Spiegel Family LLC, the
    members of which are members of Mr.&#160;Spiegel&#146;s
    immediate family.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    John T. Staton, our chief financial officer and treasurer, is
    the trustee of John T. Staton Declaration of Trust, the
    beneficiaries of which are members of Mr.&#160;Staton&#146;s
    immediate family.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Transactions with
    Ascension Health</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In October 2004, Ascension Health became our founding customer.
    Since then, in exchange for its initial
    <FONT style="white-space: nowrap">start-up</FONT>
    assistance, operational laboratory services and related
    consulting services relative to the services we were developing,
    we have issued common stock and granted warrants to Ascension
    Health, as a result of which Ascension Health is one of our 5%
    stockholders. Ascension Health is the nation&#146;s largest
    Catholic and largest nonprofit health system. It is dedicated to
    its mission of serving all, with special attention to those who
    are poor and vulnerable. Our work on behalf of Ascension Health
    is done in compliance with its charity care guidelines and
    billing and collection policies, which recognize the human
    dignity of each individual and our responsibility to treat them
    with respect. A key element of our work for Ascension Health is
    qualifying patients for charity care and identifying potential
    payment sources for patients who are uninsured and underinsured.
    Since January&#160;1, 2006, we have engaged in the following
    transactions with Ascension Health:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Customer Relationship.</I></B>&#160;&#160;In October 2004,
    we and Ascension Health entered into a master services agreement
    with an initial term through November&#160;1, 2007. In December
    2007, we and Ascension Health renewed and extended the agreement
    through December&#160;31, 2012 pursuant to an
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    106
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    amended and restated master services agreement, which will
    automatically renew for successive one-year terms unless
    terminated by us or Ascension Health upon 180&#160;days prior
    written notice.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Pursuant to the amended and restated master services agreement,
    we provide our revenue cycle service offering to hospitals
    affiliated with Ascension Health that execute separate managed
    service contracts with us and thereby become our customers. In
    rendering our services, we must comply with each hospital&#146;s
    policies and procedures relating to billing, collections,
    charity care, personnel, risk management, good corporate
    citizenship and other matters; the ethical and religious
    directives for Catholic healthcare services; and all applicable
    federal, state and local laws and regulations. Ascension
    Health&#146;s affiliated hospitals are not obligated to execute
    a managed service contract with us or to use our services. Each
    managed service contract with a hospital affiliated with
    Ascension Health incorporates the provisions of the master
    services agreement and provides that the hospital will be bound
    by all amendments, modifications and waivers that we and
    Ascension Health agree to under the master services agreement.
    With certain exceptions, we are the exclusive provider of
    revenue cycle services to the hospitals affiliated with
    Ascension Health that execute managed service contracts with us,
    and we are required to consult with such hospitals before
    undertaking services for competitors identified by them in their
    contracts with us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The term of each managed service contract with a hospital
    affiliated with Ascension Health is five years and will
    automatically renew for successive one-year terms unless
    terminated by us or Ascension Health upon 210&#160;days prior
    written notice. By mutual agreement, we and Ascension Health can
    terminate the managed service contracts between us and hospitals
    affiliated with Ascension Health upon 180&#160;days prior
    written notice after the second anniversary of the effective
    date of the applicable contract. Upon 30&#160;days prior written
    notice, Ascension Health can terminate the affected portion of
    any applicable managed service contract if we are unable to
    provide services to a hospital for 30&#160;days out of any
    <FONT style="white-space: nowrap">45-day</FONT>
    period due to any cause beyond our reasonable control. We can
    terminate any applicable managed service contract if a hospital
    is excluded from participation in the federal Medicare, state
    Medicaid or other specified federal or state healthcare
    programs, and Ascension Health can terminate the master services
    agreement if we are excluded from participation in any such
    program. A hospital cannot terminate its managed service
    contract with us but it can determine not to renew its contract
    with us. All managed service contracts between us and hospitals
    affiliated with Ascension Health will terminate automatically
    when the master services agreement between us and Ascension
    Health terminates or expires.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The amended and restated master services agreement provides,
    among other things, that:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we assume full responsibility for the management and cost of the
    revenue cycle operations of each hospital that executes a
    managed service contract with us, including the payroll and
    benefit costs associated with the hospital&#146;s employees
    conducting revenue cycle activities (and who remain hospital
    employees for all purposes), and the agreements and costs
    associated with related third-party services;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we are required to supply, at our cost, a sufficient number of
    our own employees on each hospital&#146;s premises and the
    technology necessary to implement and manage our services;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each hospital must provide us with the facilities, standard
    office furnishings and services, pre-existing revenue cycle
    assets and authority to provide our services;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    in general, each hospital pays us:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="2%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    base fees equal to a specified amount, subject to annual
    increases under an inflation and wage increase formula;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    incentive fees based on achieving
    <FONT style="white-space: nowrap">agreed-upon</FONT>
    benchmarks;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    management and technology fees;
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    107
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our fees are subject to adjustment in the event specified
    performance milestones are not met, which would result in a
    reduction of future fees payable to us;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we are required to offer to Ascension Health&#146;s affiliated
    hospitals fees for our services that are at least as low as the
    fees we charge any other similarly-situated customer receiving
    comparable services at comparable volumes;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we must implement our services and technology at each hospital
    in a manner that does not cause an unplanned material disruption
    in the hospital&#146;s operations;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we are required to work to qualify patients for charity care and
    identify potential payment sources for patients who are
    uninsured and underinsured;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we are required to maintain patient and employee satisfaction
    levels as compared to specified baseline performance
    measurements;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a joint review board consisting of an equal number of senior
    executives from us and Ascension Health oversees the obligations
    and performance of the parties and hears fee disputes and other
    disputes, with any unresolved disputes submitted to binding
    arbitration (provided that hospitals cannot withhold base fees
    for any reason);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the parties provide various representations and indemnities
    (subject to a specified cap) to each other;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    following termination or expiration of the master services
    agreement or any managed service contract between us and a
    hospital affiliated with Ascension Health, if requested by
    Ascension Health, we must:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="2%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide termination assistance, in return for reasonable
    compensation, for three months;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    continue to provide our services for up to one year in return
    for compensation equal to a specified percentage of the
    then-applicable base fees;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide reasonable assistance to Ascension Health in seeking
    bids from other parties to provide similar services;&#160;and
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    following termination or expiration of the agreement, we must
    grant to the applicable hospitals a license to continue using
    all software and tools we used to provide our services, in
    exchange for payments and fees that vary depending on whether
    the agreement is terminated for cause or for any other reason.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The amended and restated master services agreement may not be
    terminated by hospitals affiliated with Ascension Health. The
    agreement may only be terminated by Ascension Health or us in
    the following circumstances:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    either party may terminate the agreement if the other party
    materially breaches the agreement and fails to cure the breach
    in accordance with specified cure provisions; and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Ascension Health may terminate the agreement (1) if we undergo a
    change in control, (2) if Ascension Health receives an opinion
    of qualified legal counsel, after consultation with our
    qualified legal counsel, in which it concludes that the
    agreement presents a material risk of causing Ascension Health
    or any affiliated hospital to violate any applicable laws,
    regulations or rules related to its operations, and that risk
    cannot be reasonably mitigated by the parties following good
    faith consultations and consideration of reasonable amendments
    and modifications to the agreement,&#160;or (3) if we become
    excluded from participation in the federal Medicare, state
    Medicaid or other specified federal or state healthcare
    programs, or if we fail to promptly remove from providing
    services to Ascension Health and its affiliates any of our staff
    or related entities that become excluded from participation in
    the federal Medicare, state Medicaid or other specified federal
    or state healthcare programs.
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    108
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In 2006, 2007 and 2008 and the six months ended June&#160;30,
    2009, net services revenue from hospitals affiliated with
    Ascension Health were $142.6&#160;million, $214.2&#160;million,
    $281.7&#160;million and $151.6&#160;million, respectively,
    representing 88.7%, 89.0%, 70.7% and 63.6% of our total net
    services revenue in such periods, respectively. As of
    June&#160;30, 2009, we had $24.4&#160;million of accounts
    receivable from hospitals affiliated with Ascension Health and
    one of the hospitals affiliated with Ascension Health had a
    credit of $0.4&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Following completion of this offering, Ascension Health will
    own&#160;&#160;&#160;&#160;&#160;% of our outstanding common
    stock. See &#147;Principal and Selling Stockholders&#148;.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Initial Stock Issuance and Protection Warrant
    Agreement.</I></B>&#160;&#160;In October and November 2004, we
    issued 902,374&#160;shares of our common stock to Ascension
    Health, then representing a 5% ownership interest in our company
    on a fully-diluted basis, and entered into a protection warrant
    agreement, under which we granted Ascension Health the right to
    purchase additional shares of our common stock from time to time
    for $0.01 per share when Ascension Health&#146;s ownership
    interest in our company declines below 5% due to our issuance of
    additional stock or rights to purchase stock. The protection
    warrant agreement, and all purchase rights granted thereunder,
    expire on the closing of this offering. In 2006, 2007, 2008 and
    the six months ended June&#160;30, 2009, we granted Ascension
    Health the right to purchase 15,752, 58,175, 23,261 and
    25,837&#160;shares of our common stock for $0.01 per share,
    respectively, pursuant to the protection warrant agreement. In
    2007, 2008 and the six months ended June&#160;30, 2009,
    Ascension Health purchased 213,100, 66,652 and
    16,758&#160;shares of our common stock, respectively, from us
    for $0.01 per share, pursuant to the protection warrant
    agreement. As of June&#160;30, 2009, Ascension Health has the
    right to purchase an additional 23,863&#160;shares pursuant to
    the protection warrant agreement at any time prior to the
    closing of this offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Supplemental Warrant
    Agreement.</I></B>&#160;&#160;Pursuant to a supplemental warrant
    agreement that became effective in November 2004, Ascension
    Health had the right to purchase up to 902,374&#160;shares of
    our common stock based upon the achievement of specified
    milestones relating to its sales and marketing assistance. In
    May 2007, we amended and restated the supplemental warrant
    agreement to reduce the number of shares covered by the
    agreement to 446,190&#160;shares. In November 2007, we further
    amended and restated the supplemental warrant agreement to
    modify the purchase right milestones. Under the supplemental
    warrant agreement, the purchase price is equal to the most
    recent common stock-equivalent price per share paid in a capital
    raising transaction or, if we have not had a capital raising
    transaction within the preceding six months, the exercise price
    of the employee stock options we have most recently granted. All
    purchase rights under the supplemental warrant agreement will
    expire on the closing of this offering. Based on Ascension
    Health&#146;s achievement of specified milestones relating to
    its sales and marketing assistance, Ascension Health earned the
    right to purchase all 446,190&#160;shares under the supplemental
    warrant agreement. The table below summarizes Ascension
    Health&#146;s purchase rights under the supplemental warrant
    agreement:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="45%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="10%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="14%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="14%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Date Earned</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Number of Shares</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Purchase Price Per
    Share</FONT></B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    December 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    223,095
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17.36
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    March 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    111,548
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    40.17
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    March 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    111,547
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    51.05
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Ascension Health may purchase these shares for cash or in a
    cashless exercise transaction in which Ascension Health receives
    a smaller number of shares (based on the difference between the
    exercise price and the fair market value of the underlying
    shares on the date of exercise).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Stock Sale.</I></B>&#160;&#160;Concurrently with the
    amendment and restatement of the supplemental warrant agreement
    described above in May 2007, we sold 669,284&#160;shares of our
    common stock to Ascension Health for $8.20 per share, which was
    equal to the fair market value of the common stock at that time,
    for an aggregate purchase price of $5,488,128.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    109
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Registration
    Rights</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We are a party to a stockholders&#146; agreement with certain of
    our stockholders, including certain of our directors, executive
    officers and holders of more than 5% of our voting securities
    and their affiliates. Pursuant to the stockholders&#146;
    agreement, after the contractual
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements expire, these stockholders will have the right to
    require us to register all or a portion of their shares under
    the Securities Act under specific circumstances and subject to
    certain limitations. For a more detailed description of these
    registration rights, see &#147;Description of Capital
    Stock&#160;&#151; Registration Rights&#148;.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Management
    Investments in Our Company</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We have not sold any shares of preferred stock since
    January&#160;1, 2006. Between August 2003 and December 2005, we
    raised approximately $16.1&#160;million from the sale of
    preferred stock. Each of our four executive officers made one or
    more cash investments in our company on the same terms as
    applicable to the other investors in these preferred stock
    financings. The cash investments of Ms.&#160;Tolan and
    Mr.&#160;Deffarges together represented more than 10% of the
    aggregate proceeds from our preferred stock financings.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Certain
    Employment Arrangements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We employ Kyle Hupach, the
    <FONT style="white-space: nowrap">brother-in-law</FONT>
    of Gregory N. Kazarian, our senior vice president, general
    counsel and secretary, as a director of revenue cycle
    operations. Mr.&#160;Hupach&#146;s current annual base salary is
    $119,000, and he also participates in our standard employee
    benefits package. In 2008, Mr.&#160;Hupach&#146;s total
    compensation, including salary, bonus and the amount of
    share-based compensation expense that we recognized for
    financial statement reporting purposes for stock options
    previously granted to him, was $156,670.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Indemnification</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our restated certificate of incorporation that will be in effect
    upon the closing of this offering provides that we will
    indemnify our directors and officers to the fullest extent
    permitted by Delaware law. In addition, prior to the closing of
    this offering, we intend to enter into indemnification
    agreements with each of our directors and executive officers
    that may be broader in scope than the specific indemnification
    provisions contained in the Delaware General Corporation Law.
    For more information regarding these agreements, see
    &#147;Management&#160;&#151; Limitation of Liability and
    Indemnification&#148; and &#147;Description of Capital
    Stock&#160;&#151; Limitation of Liability and Indemnification of
    Officers and Directors&#148;.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Policies and
    Procedures for Related Person Transactions</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to the closing of this offering, our board of directors
    intends to adopt a written related person transaction policy to
    set forth policies and procedures for the review and approval or
    ratification of related person transactions. This policy will
    cover any transaction, arrangement or relationship, or any
    series of similar transactions, arrangements or relationships,
    in which we were or are to be a participant, the amount involved
    exceeds $120,000, and a related person had or will have a direct
    or indirect material interest, including, without limitation,
    purchases of goods or services by or from the related person or
    entities in which the related person has a material interest,
    indebtedness, guarantees of indebtedness, and employment by us
    of a related person. Our related person transaction policy will
    contain exceptions for any transaction or interest that is not
    considered a related person transaction under SEC rules as in
    effect from time to time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Any related person transaction proposed to be entered into by us
    must be reported to our general counsel and will be reviewed and
    approved by the audit committee in accordance with the terms of
    the policy, prior to effectiveness or consummation of the
    transaction whenever practicable. If our general counsel
    determines that advance approval of a related person transaction
    is not practicable under the circumstances, the audit committee
    will review and, in its discretion, may ratify the related
    person transaction at the next meeting of the audit committee.
    Alternatively, our general
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    110
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    counsel may present a related person transaction arising in the
    time period between meetings of the audit committee to the chair
    of the audit committee, who will review and may approve the
    related person transaction, subject to ratification by the audit
    committee at the next meeting of the audit committee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In addition, any related person transaction previously approved
    by the audit committee or otherwise already existing that is
    ongoing in nature will be reviewed by the audit committee
    annually to ensure that such related person transaction has been
    conducted in accordance with the previous approval granted by
    the audit committee, if any, and that all required disclosures
    regarding the related person transaction are made.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Transactions involving compensation of executive officers will
    be reviewed and approved by the compensation committee in the
    manner specified in the charter of the compensation committee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    A related person transaction reviewed under this policy will be
    considered approved or ratified if it is authorized by the audit
    committee in accordance with the standards set forth in the
    policy after full disclosure of the related person&#146;s
    interests in the transaction. As appropriate for the
    circumstances, the audit committee will review and consider:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the related person&#146;s interest in the related person
    transaction;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the approximate dollar value of the amount involved in the
    related person transaction;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the approximate dollar value of the amount of the related
    person&#146;s interest in the transaction without regard to the
    amount of any profit or loss;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether the transaction was undertaken in the ordinary course of
    business of our company;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether the transaction with the related person is proposed to
    be, or was, entered into on terms no less favorable to us than
    the terms that could have been reached with an unrelated third
    party;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the purpose of, and the potential benefits to us of, the
    transaction;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any other information regarding the related person transaction
    or the related person in the context of the proposed transaction
    that would be material to investors in light of the
    circumstances of the particular transaction.
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    111
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The audit committee will review all relevant information
    available to it about the related person transaction. The audit
    committee may approve or ratify the related person transaction
    only if the audit committee determines that, under all of the
    circumstances, the transaction is in, or is not inconsistent
    with, our best interests. The audit committee may, in its sole
    discretion, impose such conditions as it deems appropriate on us
    or the related person in connection with approval of the related
    person transaction.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    112
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='115'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">PRINCIPAL AND
    SELLING STOCKHOLDERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth information regarding the
    beneficial ownership of our common stock as of June&#160;30,
    2009, by:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each of our directors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each of our named executive officers;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each person, or group of affiliated persons, who is known by us
    to beneficially own more than 5% of our common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    all of our directors and executive officers as a group;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each selling stockholder.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Beneficial ownership is determined in accordance with the rules
    of the SEC. These rules generally attribute beneficial ownership
    of securities to persons who possess sole or shared voting power
    or investment power with respect to those securities and include
    shares of common stock issuable upon the exercise of stock
    options that are immediately exercisable or exercisable within
    60&#160;days after June&#160;30, 2009. Except as otherwise
    indicated, all of the shares reflected in the table are shares
    of common stock and all persons listed below have sole voting
    and investment power with respect to the shares beneficially
    owned by them, subject to applicable community property laws.
    The information is not necessarily indicative of beneficial
    ownership for any other purpose.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Percentage ownership calculations for beneficial ownership prior
    to this offering are based on 20,803,641&#160;shares outstanding
    as of June&#160;30, 2009, assuming (1)&#160;the automatic
    conversion of all outstanding shares of non-voting common stock
    into shares of common stock upon the closing of this offering,
    (2)&#160;the automatic conversion of all outstanding shares of
    convertible preferred stock into shares of common stock upon the
    closing of this offering and (3)&#160;the assumed issuance
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock upon exercise of warrants that will be cancelled
    if not exercised prior to this offering. Percentage ownership
    calculations for beneficial ownership after this offering
    reflect the shares we are offering hereby and the issuance
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock to FT Partners contemporaneously with the
    closing of this offering, based on an assumed initial public
    offering price of $&#160;&#160;&#160;&#160;&#160; per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus. Except as otherwise indicated in the table below,
    addresses of named beneficial owners are in care of Accretive
    Health, Inc., 401 North Michigan Avenue, Suite&#160;2700,
    Chicago, Illinois 60611.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    113
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In computing the number of shares of common stock beneficially
    owned by a person and the percentage ownership of that person,
    we deemed outstanding (1)&#160;shares of common stock subject to
    options or warrants held by that person that are immediately
    exercisable or exercisable within 60&#160;days of June&#160;30,
    2009 and (2)&#160;shares of common stock to be received prior to
    the closing of this offering pursuant to the distribution of
    shares from an entity pursuant to which certain directors and
    executive officers previously invested in our company. We did
    not deem these shares outstanding, however, for the purpose of
    computing the percentage ownership of any other person.
    Beneficial ownership representing less than 1% is denoted with
    an asterisk (*).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="40%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Shares Beneficially Owned<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Shares Beneficially Owned<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Prior to Offering</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>After Offering</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Name of Beneficial
    Owner</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Number</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Percentage</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Shares Offered</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Number</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Percentage</FONT></B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    <B>5% Stockholders</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Accretive Investors SBIC, L.P.(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,333,921
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25.6
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    FW Oak Hill Accretive Healthcare Investors, L.P.(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,445,087
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21.4
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Ascension Health(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,339,538
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11.0
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    <B>Executive Officers and Directors</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Mary A. Tolan(4)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,553,167
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17.1
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    John T. Staton(5)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    319,303
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.5
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Etienne H. Deffarges(6)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,416,443
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6.7
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Gregory N. Kazarian(7)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    293,384
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.4
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Edgar M. Bronfman, Jr.(8)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    J. Michael Cline(9)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,333,921
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25.6
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Steven N. Kaplan(10)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    104,098
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
    *
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Denis J. Nayden(11)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    George P. Shultz(12)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    181,368
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
    *
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Arthur H. Spiegel,&#160;III(13)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,038,724
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.9
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Mark A. Wolfson(14)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    All current executive officers and directors as a group
    (11&#160;persons)(15)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,240,408
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    56.3
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    <B>Other Selling Stockholders</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(1)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Accretive Associates SBIC, LLC is
    the general partner of Accretive Investors SBIC, L.P.
    Mr.&#160;Cline is the managing member of Accretive Associates
    SBIC, LLC, and may be deemed to have sole voting and investment
    power with respect to the shares held by Accretive Investors
    SBIC, L.P. The address of Accretive Investors SBIC, L.P. is
    <FONT style="white-space: nowrap">c/o&#160;Accretive,</FONT>
    LLC, 51 Madison Avenue, 31st Floor, New York, New York 10010.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(2)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Group VI 31, LLC is the general
    partner of FW Oak Hill Accretive Healthcare Investors, L.P. (the
    &#147;Oak Hill Partnership&#148;) The sole member of Group VI
    31, LLC is J. Taylor Crandall, who disclaims beneficial
    ownership of such shares, except to the extent of his pecuniary
    interest therein. J. Taylor Crandall exercises voting and
    investment power with respect to such shares. The address of the
    Oak Hill Partnership is 201 Main Street, Suite&#160;3100,
    Fort&#160;Worth, Texas 76102. Messrs.&#160;Nayden and Wolfson
    are limited partners of the Oak Hill Partnership, and
    Mr.&#160;Wolfson is a Vice President and Assistant Secretary of
    Group VI 31, LLC.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(3)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Ascension Health is a Missouri
    not-for-profit corporation. Anthony J. Speranzo, Ascension
    Health&#146;s senior vice president and chief financial officer,
    has sole voting and investment power with respect to the shares
    held by Ascension Health. Mr.&#160;Speranzo disclaims beneficial
    ownership of such shares. Includes warrants to purchase
    471,370&#160;shares exercisable within 60&#160;days of
    June&#160;30, 2009. The address of Ascension Health is 4600
    Edmundson Road, St.&#160;Louis, Missouri 63134.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(4)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Includes 825,000&#160;shares held
    by family trusts. Members of Ms.&#160;Tolan&#146;s immediate
    family share voting and investment power with respect to the
    shares held by these trusts.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(5)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Consists of 100,000&#160;shares
    held by John T. Staton Declaration of Trust, 20,008&#160;shares
    of our common stock to be received by John T. Staton Declaration
    of Trust pursuant to the investment distribution referred to
    above, and 199,295&#160;shares subject to options exercisable
    within 60&#160;days of June&#160;30, 2009, of which
    </FONT></TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    114
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">12,470&#160;shares will vest within
    60&#160;days of June&#160;30, 2009. The beneficiaries of John T.
    Staton Declaration of Trust are members of
    Mr.&#160;Staton&#146;s immediate family. Mr.&#160;Staton is the
    trustee of such trust and exercises sole voting and investment
    power with respect to the shares held by the trust.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(6)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Includes 249,776&#160;shares of our
    common stock to be received pursuant to the investment
    distribution referred to above.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(7)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Includes 43,384&#160;shares of our
    common stock to be received pursuant to the investment
    distribution referred to above.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(8)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Mr.&#160;Bronfman is a member of
    Accretive Associates SBIC, LLC, which is the general partner of
    Accretive Investors SBIC, L.P., but exercises no voting or
    investment power with respect to the shares held by Accretive
    Investors SBIC, L.P. Mr.&#160;Bronfman disclaims beneficial
    ownership of the shares held by Accretive Investors SBIC, L.P.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(9)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Consists of the shares described in
    note (1)&#160;above. Mr.&#160;Cline is the managing member of
    Accretive Associates SBIC, LLC, which is the general partner of
    Accretive Investors SBIC, L.P. and, as such, may be deemed to
    have sole voting and investment power with respect to the shares
    described in note (1)&#160;above.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(10)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Includes 62,431&#160;shares of our
    common stock to be received pursuant to the investment
    distribution referred to above.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(11)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">See note (2)&#160;above.
    Mr.&#160;Nayden is not deemed to have voting or investment power
    with respect to any shares held by the Oak Hill Partnership as a
    limited partner.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(12)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Consists of 90,000&#160;shares held
    by The Shultz 1989 Family Trust, of which Mr.&#160;Shultz and
    his wife are the beneficiaries, and 91,368&#160;shares of our
    common stock to be received by The Shultz 1989 Family Trust
    pursuant to the investment distribution referred to above.
    George T. Argyris is the trustee for the trust and exercises
    sole voting and investment power with respect to the shares held
    by the trust. Mr.&#160;Argyris disclaims beneficial ownership of
    such shares.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(13)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Consists of 750,000&#160;shares
    held by Spiegel Family LLC, the members of which are members of
    Mr.&#160;Spiegel&#146;s immediate family, and
    288,724&#160;shares of our common stock to be received by
    Spiegel Family LLC pursuant to the investment distribution
    referred to above. Mr.&#160;Spiegel and his wife are the
    managing members of Spiegel Family LLC and exercise shared
    voting and investment power with respect to such shares.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(14)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">See note (2)&#160;above.
    Mr.&#160;Wolfson is not deemed to have voting or investment
    power with respect to any shares held by the Oak Hill
    Partnership as a limited partner or as a Vice President or
    Assistant Secretary of Group VI 31, LLC.
    </FONT></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(15)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Includes the shares described in
    notes (1)&#160;and (2)&#160;above, 755,691&#160;shares of our
    common stock to be received pursuant to the investment
    distribution referred to above, and 199,295&#160;shares subject
    to options exercisable within 60&#160;days of June&#160;30,
    2009, of which 12,470&#160;shares will vest within 60&#160;days
    of June&#160;30, 2009.
    </FONT></TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    115
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='116'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">DESCRIPTION OF
    CAPITAL STOCK</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">General</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Following the closing of this offering, our authorized capital
    stock will consist
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock, par value $0.01 per share, and
    5,000,000&#160;shares of preferred stock, par value $0.01 per
    share, all of which preferred stock will be undesignated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following description of our capital stock and provisions of
    our certificate of incorporation and bylaws are summaries and
    are qualified by reference to the restated certificate of
    incorporation and the amended and restated bylaws that will be
    in effect upon the closing of this offering. Copies of these
    documents have been filed with the SEC as exhibits to our
    registration statement, of which this prospectus forms a part.
    The descriptions of the common stock and preferred stock reflect
    changes to our capital structure that will occur upon the
    closing of this offering.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Common
    Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of June&#160;30, 2009, there were 20,803,641&#160;shares of
    our common stock outstanding, held of record by 84 stockholders,
    assuming the conversion of all outstanding shares of convertible
    preferred stock into common stock and the conversion of all
    outstanding shares of non-voting common stock into common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The holders of our common stock are entitled to one vote for
    each share held on all matters submitted to a vote of the
    stockholders and do not have any cumulative voting rights.
    Holders of our common stock are entitled to receive
    proportionally any dividends declared by our board of directors
    out of funds legally available therefor, subject to any
    preferential dividend or other rights of any then outstanding
    preferred stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In the event of our liquidation or dissolution, holders of our
    common stock are entitled to share ratably in all assets
    remaining after payment of all debts and other liabilities,
    subject to the prior rights of any then outstanding preferred
    stock. Holders of our common stock have no preemptive,
    subscription, redemption or conversion rights. All outstanding
    shares of our common stock are validly issued, fully paid and
    nonassessable. The shares to be issued by us in this offering
    will be, when issued and paid for, validly issued, fully paid
    and nonassessable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The rights, preferences and privileges of holders of our common
    stock are subject to, and may be adversely affected by, the
    rights of holders of shares of any series of preferred stock
    that we may designate and issue in the future.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Preferred
    Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Under the terms of our certificate of incorporation, our board
    of directors is authorized to issue shares of preferred stock in
    one or more series without stockholder approval. Our board of
    directors has the discretion to determine the rights,
    preferences, privileges and restrictions, including voting
    rights, dividend rights, conversion rights, redemption
    privileges and liquidation preferences, of each series of
    preferred stock, any or all of which may be greater than or
    senior to the rights of the common stock. The issuance of
    preferred stock could adversely affect the voting power of
    holders of common stock and reduce the likelihood that such
    holders will receive dividend payments or payments on
    liquidation. In certain circumstances, an issuance of preferred
    stock could have the effect of decreasing the market price of
    our common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Authorizing our board of directors to issue preferred stock and
    determine its rights and preferences has the effect of
    eliminating delays associated with a stockholder vote on
    specific issuances. The issuance of preferred stock, while
    providing flexibility in connection with possible acquisitions,
    future financings and other corporate purposes, could have the
    effect of making it more difficult for a third party to acquire,
    or could discourage a third party from seeking to acquire, a
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    116
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    majority of our outstanding stock. Upon the closing of this
    offering, there will be no shares of preferred stock
    outstanding, and we have no present plans to issue any shares of
    preferred stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Stock
    Options</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of June&#160;30, 2009, 2,440,885&#160;shares of common stock
    were issuable upon the exercise of stock options outstanding and
    exercisable at a weighted-average exercise price of $21.59 per
    share, of which 1,054,930&#160;shares with a weighted-average
    exercise price of $8.52 per share would be vested if purchased
    upon exercise of these options as of June&#160;30, 2009.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Warrants</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of June&#160;30, 2009, 470,053&#160;shares of voting common
    stock were issuable upon the exercise of warrants outstanding
    and exercisable at a weighted-average exercise price of $29.77
    per share and 833,334&#160;shares of non-voting common stock
    were issuable upon the exercise of warrants outstanding and
    exercisable at a weighted-average exercise price of $1.12 per
    share. All of these warrants may be exercised by paying the
    exercise price in cash or pursuant to a cashless exercise
    feature based on the fair market value per share of our common
    stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Upon the closing of this offering, all outstanding warrants to
    purchase shares of voting common stock that are not exercised
    prior to this offering will be cancelled. If all of these
    unexercised warrants to purchase voting common stock are
    exercised on a cashless basis upon consummation of this
    offering, assuming an initial public offering price of
    $&#160;&#160;&#160;&#160;&#160;, the midpoint of the estimated
    price range shown on the cover of this prospectus, we would
    issue an aggregate
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock and receive no cash proceeds. If all of these
    unexercised warrants to purchase voting common stock are
    exercised for cash, we would issue an aggregate
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock for cash proceeds of
    $&#160;&#160;&#160;&#160;&#160;.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Upon the closing of this offering and the automatic conversion
    of all outstanding shares of non-voting common stock into shares
    of voting stock, any warrants to purchase non-voting common
    stock that are not exercised prior to this offering will remain
    outstanding and will be warrants to purchase shares of voting
    common stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Registration
    Rights</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We have entered into a stockholders&#146; agreement with certain
    of our stockholders. After the completion of this offering and
    the sale by the selling stockholders of the shares of common
    stock offered by them hereby, holders of an aggregate
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of outstanding common stock and shares issuable upon exercise of
    outstanding warrants will have the right to require us to
    register these shares under the Securities Act under specified
    circumstances. After registration pursuant to these rights,
    these shares will become freely tradable by non-affiliates
    without restriction under the Securities Act. The following
    description of these registration rights is intended as a
    summary only and is qualified in its entirety by reference to
    the stockholders&#146; agreement, which is filed as an exhibit
    to the registration statement of which this prospectus forms a
    part.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Demand Registration Rights.</I></B>&#160;&#160;Beginning
    181&#160;days after the effective date of the registration
    statement of which this prospectus forms a part, subject to the
    contractual
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements, the holders of at least 50% of our shares of common
    stock having registration rights under the stockholders&#146;
    agreement, provided such shares represent at least 25% of our
    outstanding common stock on a fully-diluted basis, may demand
    that we register all or a portion of their shares under the
    Securities Act, subject to certain limitations. In addition,
    each party to the stockholders&#146; agreement holding more than
    12% of our common stock on an as-converted basis as of
    September&#160;25, 2009&#160;may demand on one occasion that we
    register all or a portion of its shares under the Securities
    Act, provided that the shares to be registered have an aggregate
    market value of at least $50&#160;million or represent at least
    5% of our then outstanding common stock. We are not required to
    file (1)&#160;a registration statement less than six months
    after the effective date of a registration statement effected
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    117
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    pursuant to this requirement of the stockholders&#146; agreement
    or (2)&#160;more than five registration statements pursuant to
    this requirement under the stockholders&#146; agreement. In
    addition, we may not register any shares of our common stock
    held by a stockholder who is not a party to the
    stockholders&#146; agreement in a registration statement
    requested to be filed pursuant to the terms of the
    stockholders&#146; agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><I>Incidental Registration Rights.</I></B>&#160;&#160;If at
    any time we propose to register shares of our common stock under
    the Securities Act, other than a registration statement on
    <FONT style="white-space: nowrap">Form&#160;S-4</FONT>
    or
    <FONT style="white-space: nowrap">Form&#160;S-8,</FONT>
    the holders of registrable shares under the stockholders&#146;
    agreement will be entitled to notice of our intention to file a
    registration statement and, subject to certain exceptions, have
    the right to require us to use best efforts to register all or a
    portion of the registrable shares held by them. In the event
    that any registration in which the holders of registrable shares
    participate pursuant to the stockholders&#146; agreement is an
    underwritten public offering, the number of registrable shares
    to be included may, in specified circumstances, be limited due
    to market conditions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Pursuant to the stockholders&#146; agreement, we are required to
    pay all registration fees and expenses and indemnify each
    participating stockholder with respect to each registration of
    registrable shares that is effected.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Anti-Takeover
    Effects of Delaware Law and Our Charter and Bylaws</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Delaware law, our certificate of incorporation and our bylaws
    contain provisions that could have the effect of delaying,
    deferring or discouraging another party from acquiring control
    of us. These provisions, which are summarized below, are
    expected to discourage coercive takeover practices and
    inadequate takeover bids. These provisions are also designed to
    encourage persons seeking to acquire control of us to first
    negotiate with our board of directors.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Classified
    Board; Removal of Directors</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our certificate of incorporation and bylaws divide our board of
    directors into three classes with staggered three-year terms. In
    addition, a director may be removed only for cause and only by
    the affirmative vote of the holders of at least two-thirds of
    the voting power of our outstanding common stock. Any vacancy on
    our board of directors, including a vacancy resulting from an
    enlargement of our board of directors, may be filled only by
    vote of a majority of our directors then in office. The
    classification of our board of directors and the limitations on
    the removal of directors and filling of vacancies could make it
    more difficult for a third party to acquire, or discourage a
    third party from seeking to acquire, control of our company.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Stockholder
    Action by Written Consent; Special Meetings</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our certificate of incorporation provides that any action
    required or permitted to be taken by our stockholders must be
    effected at a duly called annual or special meeting of such
    holders and may not be effected by any consent in writing by
    such holders. Our certificate of incorporation and bylaws also
    provide that, except as otherwise required by law, special
    meetings of our stockholders can only be called by our chairman
    of the board, our chief executive officer or our board of
    directors.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Advance Notice
    Requirements for Stockholder Proposals</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our bylaws establish an advance notice procedure for stockholder
    proposals to be brought before an annual meeting of
    stockholders, including proposed nominations of persons for
    election to the board of directors. Stockholders at an annual
    meeting may only consider proposals or nominations specified in
    the notice of meeting or brought before the meeting by or at the
    direction of the board of directors or by a stockholder of
    record on the record date for the meeting, who is entitled to
    vote at the meeting and who has delivered timely written notice
    in proper form to our secretary of the stockholder&#146;s
    intention to bring such business before the meeting. This
    written notice must contain certain information specified in our
    bylaws. These provisions could have the effect of delaying until
    the
</DIV>

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    <BR>
    118
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    next stockholder meeting stockholder actions that are favored by
    the holders of a majority of our outstanding voting securities.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Delaware
    Business Combination Statute</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We are subject to Section&#160;203 of the Delaware General
    Corporation Law. Subject to certain exceptions, Section&#160;203
    prevents a publicly-held Delaware corporation from engaging in a
    &#147;business combination&#148; with any &#147;interested
    stockholder&#148; for three years following the date that the
    person became an interested stockholder, unless the interested
    stockholder attained such status with the approval of our board
    of directors or unless the business combination is approved in a
    prescribed manner. A &#147;business combination&#148; includes,
    among other things, a merger or consolidation involving us and
    the &#147;interested stockholder&#148; and the sale of more than
    10% of our assets. In general, an &#147;interested
    stockholder&#148; is any entity or person beneficially owning
    15% or more of our outstanding voting stock and any entity or
    person affiliated with or controlling or controlled by such
    entity or person.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Amendment of
    Certificate of Incorporation and Bylaws</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Delaware General Corporation Law provides generally that the
    affirmative vote of a majority of the shares entitled to vote on
    any matter is required to amend a corporation&#146;s certificate
    of incorporation or bylaws, unless a corporation&#146;s
    certificate of incorporation or bylaws, as the case may be,
    requires a greater percentage. Our bylaws may be amended or
    repealed by a majority vote of our board of directors or by the
    affirmative vote of the holders of at least two-thirds of the
    votes which all our stockholders would be entitled to cast in
    any election of directors. In addition, the affirmative vote of
    the holders of at least two-thirds of the votes which all our
    stockholders would be entitled to cast in any election of
    directors is required to amend or repeal or to adopt any
    provisions inconsistent with any of the provisions of our
    certificate of incorporation described above under
    &#147;&#151;&#160;Classified Board; Removal of Directors&#148;
    and &#147;&#151;&#160;Stockholder Action by Written Consent;
    Special Meetings&#148;.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Limitation of
    Liability and Indemnification of Officers and
    Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our restated certificate of incorporation limits the personal
    liability of directors for breach of fiduciary duty to the
    maximum extent permitted by the Delaware General Corporation
    Law. Our restated certificate of incorporation also provides
    that no director will have personal liability to us or to our
    stockholders for monetary damages for breach of fiduciary duty
    as a director. However, these provisions do not eliminate or
    limit the liability of any of our directors for:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any breach of the director&#146;s duty of loyalty to us or our
    stockholders;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any act or omission not in good faith or which involves
    intentional misconduct or a knowing violation of law;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any unlawful payments related to dividends or unlawful stock
    repurchases or redemptions;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any transaction from which the director derived an improper
    personal benefit.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Any amendment to or repeal of these provisions will not
    eliminate or reduce the effect of these provisions in respect of
    any act or failure to act, or any cause of action, suit or claim
    that would accrue or arise prior to any amendment or repeal or
    adoption of an inconsistent provision. If the Delaware General
    Corporation Law is amended to permit the further elimination or
    limiting of the personal liability of directors, then the
    liability of our directors will be eliminated or limited to the
    fullest extent permitted by the Delaware General Corporation Law
    as so amended.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In addition, our restated certificate of incorporation provides
    that we must indemnify our directors and officers and we must
    advance expenses, including attorneys&#146; fees, to our
    directors and officers in connection with legal proceedings,
    subject to limited exceptions.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    119
</DIV><!-- END PAGE WIDTH -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Authorized but
    Unissued Shares</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The authorized but unissued shares of common stock and preferred
    stock are available for future issuance without stockholder
    approval, subject to any limitations imposed by the listing
    standards of The New York Stock Exchange. These additional
    shares may be used for a variety of corporate finance
    transactions, acquisitions and employee benefit plans. The
    existence of authorized but unissued and unreserved common stock
    and preferred stock could make it more difficult or discourage
    an attempt to obtain control of us by means of a proxy contest,
    tender offer, merger or otherwise.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Transfer Agent
    and Registrar</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to the closing of this offering, we will appoint a
    transfer agent and registrar for our common stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">New York Stock
    Exchange</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We intend to apply to have our common stock listed on the New
    York Stock Exchange under the symbol &#147;AH&#148;.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    120
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='117'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">SHARES ELIGIBLE
    FOR FUTURE SALE</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to this offering, there has been no public market for our
    common stock, and a liquid public trading market for our common
    stock may not develop or be sustained after this offering.
    Future sales of significant amounts of our common stock,
    including shares issued upon exercise of outstanding options or
    warrants or in the public market after this offering, or the
    anticipation of those sales, could adversely affect the public
    market prices prevailing from time to time and could impair our
    ability to raise capital through sales of our equity securities.
    We intend to apply to have our common stock listed on The New
    York Stock Exchange under the symbol &#147;AH&#148;.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Upon the closing of this offering, we will have outstanding an
    aggregate
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock, assuming no exercise by the underwriters of
    their option to purchase additional shares and no exercise of
    outstanding options or warrants. Of these shares, all shares
    sold in this offering will be freely tradable without
    restriction or further registration under the Securities Act,
    except for any shares purchased by our &#147;affiliates&#148;,
    as that term is defined in Rule&#160;144 under the Securities
    Act, whose sales would be subject to the Rule&#160;144 resale
    restrictions described below, other than the holding period
    requirement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The
    remaining&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock will be &#147;restricted securities&#148;, as
    that term is defined in Rule&#160;144 under the Securities Act.
    These restricted securities are eligible for public sale only if
    they are registered under the Securities Act or if they qualify
    for an exemption from registration under Rules&#160;144 or 701
    under the Securities Act, which are summarized below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Subject to the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements described below and the provisions of Rules&#160;144
    and 701 under the Securities Act, these restricted securities
    will be available for sale in the public market as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="34%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="32%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="32%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Shares Eligible<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Date Available for
    Sale</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">for Sale</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Comment</FONT></B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Date of prospectus
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Shares sold in the offering and shares saleable under Rule 144
    that are not subject to a lock-up
</TD>
</TR>
<TR valign="bottom" style="line-height: 6pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    90&#160;days after date of prospectus
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Shares saleable under Rules 144 and 701 that are not subject to
    a lock-up
</TD>
</TR>
<TR valign="bottom" style="line-height: 6pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    180&#160;days after date of prospectus
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Lock-up released; shares saleable under Rules 144 and 701
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In addition, of the 2,440,885&#160;shares of our common stock
    that were subject to stock options outstanding as of
    June&#160;30, 2009, 1,054,930&#160;shares would be vested if
    purchased upon exercise of these options and would be eligible
    for sale subject to the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements and securities laws described below. The
    1,304,704&#160;shares of our common stock that were subject to
    warrants outstanding as of June&#160;30, 2009 were exercisable
    as of June&#160;30, 2009 and, assuming a cashless exercise,
    these shares will be eligible for sale subject to the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements and securities laws described below.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Rule&#160;144</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Affiliate
    Resales of Restricted Securities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In general, beginning 90&#160;days after the effective date of
    the registration statement of which this prospectus is a part, a
    person who is an affiliate of ours, or who was an affiliate at
    any time during the 90&#160;days before a sale, who has
    beneficially owned shares of our common stock for at least six
    months would be entitled to sell in &#147;broker&#146;s
    transactions&#148; or certain &#147;riskless principal
    transactions&#148; or
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    121
</DIV><!-- END PAGE WIDTH -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    to market makers, a number of shares within any three-month
    period that does not exceed the greater of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    1% of the number of shares of our common stock then outstanding,
    which will equal
    approximately&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    immediately after this offering;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the average weekly trading volume in our common stock on the
    NYSE during the four calendar weeks preceding the filing of a
    notice on Form 144 with respect to such sale.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Affiliate resales under Rule&#160;144 are also subject to the
    availability of current public information about us. In
    addition, if the number of shares being sold under Rule&#160;144
    by an affiliate during any three-month period exceeds
    5,000&#160;shares or has an aggregate sale price in excess of
    $50,000, the seller must file a notice on Form&#160;144 with the
    SEC and the NYSE concurrently with either the placing of a sale
    order with the broker or the execution directly with a market
    maker.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Non-Affiliate
    Resales of Restricted Securities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In general, beginning 90&#160;days after the effective date of
    the registration statement of which this prospectus is a part, a
    person who is not an affiliate of ours at the time of sale, and
    has not been an affiliate at any time during the three months
    preceding a sale, and who has beneficially owned shares of our
    common stock for at least six months but less than a year, is
    entitled to sell such shares subject only to the availability of
    current public information about us. If such person has held our
    shares for at least one year, such person can resell under
    Rule&#160;144(b)(1) without regard to any Rule&#160;144
    restrictions, including the
    <FONT style="white-space: nowrap">90-day</FONT>
    public company requirement and the current public information
    requirement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Non-affiliate resales are not subject to the manner of sale,
    volume limitation or notice filing provisions of Rule&#160;144.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Rule&#160;701</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In general, under Rule&#160;701, any of our employees,
    directors, officers, consultants or advisors who purchased
    shares from us in connection with a compensatory stock or option
    plan or other written agreement entered into before the
    effective date of this offering is entitled to sell such shares
    90&#160;days after this offering in reliance on Rule&#160;144.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica"><FONT style="white-space: nowrap">Lock-up</FONT>
    Agreements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our officers and directors and the holders of substantially all
    of our outstanding shares of common stock have agreed with the
    underwriters, subject to certain exceptions, not to offer, sell,
    contract to sell, pledge, grant any option to purchase, make any
    short sale or otherwise dispose of any shares of common stock,
    options or warrants to purchase shares of common stock or
    securities convertible into, exchangeable for or that represent
    the right to receive shares of common stock, whether now owned
    or hereafter acquired, make any demand for, or exercise any
    right with respect to, the registration of any shares of common
    stock or any securities convertible into or exercisable or
    exchangeable for shares of common stock during the period from
    the date of this prospectus continuing through the date
    180&#160;days after the date of this prospectus, as modified as
    described below, except with the prior written consent of
    Goldman, Sachs&#160;&#038; Co. and Credit Suisse Securities
    (USA) LLC, on behalf of the underwriters.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The <FONT style="white-space: nowrap">180-day</FONT>
    restricted period will be automatically extended under the
    following circumstances:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if, during the last 17&#160;days of the
    <FONT style="white-space: nowrap">180-day</FONT>
    restricted period, we issue an earnings release or announce
    material news or a material event, the restrictions described in
    the preceding paragraph will continue to apply until the
    expiration of the
    <FONT style="white-space: nowrap">18-day</FONT>
    period beginning on the issuance of the earnings release or the
    announcement of the material news or material event;&#160;or
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    122
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if, prior to the expiration of the
    <FONT style="white-space: nowrap">180-day</FONT>
    restricted period, we announce that we will release earnings
    results during the
    <FONT style="white-space: nowrap">16-day</FONT>
    period beginning on the last day of the
    <FONT style="white-space: nowrap">180-day</FONT>
    period, the restrictions described in the preceding paragraph
    will continue to apply until the expiration of the
    <FONT style="white-space: nowrap">18-day</FONT>
    period beginning on the issuance of the earnings release.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Goldman, Sachs&#160;&#038; Co. and Credit Suisse Securities
    (USA) LLC currently do not anticipate shortening or waiving any
    of the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements and do not have any pre-established conditions for
    such modifications or waivers. Goldman, Sachs&#160;&#038; Co.
    and Credit Suisse Securities (USA) LLC may, however, with the
    approval of our board of directors, release for sale in the
    public market all or any portion of the shares subject to the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreement.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Stock Options and
    Warrants</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of June&#160;30, 2009, 2,440,885&#160;shares of common stock
    were issuable upon the exercise of stock options outstanding, of
    which 1,054,930&#160;shares would be vested if purchased upon
    exercise of these options as of June&#160;30, 2009. Following
    this offering, we intend to file registration statements on
    <FONT style="white-space: nowrap">Form&#160;S-8</FONT>
    under the Securities Act to register all of the shares of common
    stock subject to outstanding options and options and other
    awards issuable pursuant to our 2003 stock plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of June&#160;30, 2009, 470,053&#160;shares of voting common
    stock and 833,334&#160;shares of non-voting common stock were
    issuable upon the exercise of warrants outstanding. Any shares
    purchased by our non-affiliates pursuant to the cashless
    exercise feature of our warrants will be freely tradable under
    Rule&#160;144(b)(1), subject to the
    <FONT style="white-space: nowrap">180-day</FONT>
    <FONT style="white-space: nowrap">lock-up</FONT>
    period described above. Upon the closing of this offering, all
    outstanding warrants to purchase shares of voting common stock
    that are not exercised prior to this offering will be cancelled.
    Upon the closing of this offering and the automatic conversion
    of all outstanding shares of non-voting common stock into shares
    of voting stock, any warrants to purchase non-voting common
    stock that are not exercised prior to this offering will remain
    outstanding and will be warrants to purchase shares of voting
    common stock.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    123
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='118'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">CERTAIN U.S.
    FEDERAL TAX CONSEQUENCES TO
    <FONT style="white-space: nowrap">NON-U.S.</FONT>
    HOLDERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following is a general discussion of certain
    U.S.&#160;federal income and estate tax consequences of the
    purchase, ownership and disposition of our common stock. This
    discussion applies only to a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    (as defined below) of our common stock. This discussion is based
    upon the provisions of the Internal Revenue Code of 1986, as
    amended, or the Code, the Treasury regulations promulgated
    thereunder and administrative and judicial interpretations
    thereof, all as of the date hereof, all of which are subject to
    change, possibly with retroactive effect. This discussion is
    limited to investors that hold our common stock as capital
    assets for U.S.&#160;federal income tax purposes. Furthermore,
    this discussion does not address all aspects of
    U.S.&#160;federal income and estate taxation that may be
    applicable to investors in light of their particular
    circumstances, or to investors subject to special treatment
    under U.S.&#160;federal income or estate tax law, such as
    financial institutions, insurance companies, tax-exempt
    organizations, entities that are treated as partnerships for
    U.S.&#160;federal tax purposes, dealers in securities or
    currencies, expatriates, persons deemed to sell our common stock
    under the constructive sale provisions of the Code and persons
    that hold our common stock as part of a straddle, hedge,
    conversion transaction or other integrated investment. In
    addition, this discussion does not address any U.S.&#160;federal
    gift tax consequences or any state, local or foreign tax
    consequences. Prospective investors should consult their tax
    advisors regarding the U.S.&#160;federal, state, local
    alternative minimum and foreign income, estate and other tax
    consequences of the purchase, ownership and disposition of our
    common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    For purposes of this summary, the term
    <FONT style="white-space: nowrap">&#147;non-U.S.&#160;holder&#148;</FONT>
    means a beneficial owner of our common stock that is not, for
    U.S.&#160;federal income and estate tax purposes:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a citizen or resident of the United States;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a corporation or other entity subject to tax as a corporation
    for such purposes that is created or organized under the laws of
    the United States or any political subdivision thereof;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a partnership (including any entity or arrangement treated as a
    partnership for such purposes);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an estate the income of which is subject to U.S.&#160;federal
    income taxation regardless of its source;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a trust (1)&#160;if a court within the United States is able to
    exercise primary supervision over its administration and one or
    more U.S.&#160;persons have the authority to control all of its
    substantial decisions or (2)&#160;that has made a valid election
    to be treated as a U.S.&#160;person for such purposes.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    If a partnership (including any entity or arrangement treated as
    a partnership for such purposes) owns our common stock, the tax
    treatment of a partner in the partnership will depend upon the
    status of the partner and the activities of the partnership.
    Partners in a partnership that owns our common stock should
    consult their tax advisors as to the particular
    U.S.&#160;federal income and estate tax consequences applicable
    to them.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Dividends</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Dividends paid to a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    generally will be subject to withholding of U.S.&#160;federal
    income tax at a 30% rate or such lower rate as may be specified
    by an applicable income tax treaty.
    <FONT style="white-space: nowrap">Non-U.S.&#160;holders</FONT>
    should consult their tax advisors regarding their entitlement to
    benefits under an applicable income tax treaty and the manner of
    claiming the benefits of such treaty. A
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    that is eligible for a reduced rate of withholding tax under an
    income tax treaty may obtain a refund or credit of any excess
    amounts withheld by filing an appropriate claim for refund with
    the Internal Revenue Service.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Dividends that are effectively connected with a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    conduct of a trade or business in the United States and, if
    certain income tax treaties apply, that are attributable to a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    permanent establishment in the United States are not subject to
    the withholding tax
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    124
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    described above but instead are subject to U.S.&#160;federal
    income tax on a net income basis at applicable graduated
    U.S.&#160;federal income tax rates. A
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    must satisfy certain certification requirements for its
    effectively connected dividends to be exempt from the
    withholding tax described above. Dividends received by a foreign
    corporation that are effectively connected with its conduct of a
    trade or business in the United States may be subject to an
    additional branch profits tax at a 30% rate or such lower rate
    as may be specified by an applicable income tax treaty.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Gain on
    Disposition of Common Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    A
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    generally will not be taxed on gain recognized on a disposition
    of our common stock unless:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    is an individual who holds our common stock as a capital asset,
    is present in the United States for 183&#160;days or more during
    the taxable year of the disposition and meets certain other
    conditions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the gain is effectively connected with the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    conduct of a trade or business in the United States and, if
    certain income tax treaties apply, is attributable to a
    <FONT style="white-space: nowrap">non-U.S.&#160;Holder&#146;s</FONT>
    permanent establishment in the United States;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we are or have been a &#147;United States real property holding
    corporation&#148; for U.S.&#160;federal income tax purposes at
    any time within the shorter of the five-year period ending on
    the date of disposition or the period that the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    held our common stock.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We do not believe that we have been, currently are, or will
    become, a United States real property holding corporation. If we
    were or were to become a United States real property holding
    corporation at any time during the applicable period, however,
    any gain recognized on a disposition of our common stock by a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    that did not own (directly, indirectly or constructively) more
    than 5% of our common stock during the applicable period would
    not be subject to U.S.&#160;federal income tax, provided that
    our common stock is &#147;regularly traded on an established
    securities market&#148; (within the meaning of
    Section&#160;897(c)(3) of the Code).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Individual
    <FONT style="white-space: nowrap">non-U.S.&#160;holders</FONT>
    who are subject to U.S.&#160;federal income tax because the
    holders were present in the United States for 183&#160;days or
    more during the year of disposition are taxed on their gains
    (including gains from the sale of our common stock and net of
    applicable U.S.&#160;losses from sales or exchanges of other
    capital assets recognized during the year) at a flat rate of 30%
    or such lower rate as may be specified by an applicable income
    tax treaty. Other
    <FONT style="white-space: nowrap">non-U.S.&#160;holders</FONT>
    subject to U.S.&#160;federal income tax with respect to gain
    recognized on the disposition of our common stock generally will
    be taxed on any such gain on a net income basis at applicable
    graduated U.S.&#160;federal income tax rates and, in the case of
    foreign corporations, the branch profits tax discussed above
    also may apply.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Federal Estate
    Tax</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our common stock that is owned or treated as owned for
    U.S.&#160;estate tax purposes by an individual who is a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    at the time of death will be included in the individual&#146;s
    gross estate for U.S.&#160;federal estate tax purposes.
    Therefore, U.S.&#160;federal estate tax may be imposed with
    respect to the value of such stock, unless an applicable estate
    tax or other treaty provides otherwise.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Information
    Reporting and Backup Withholding</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In general, backup withholding will apply to dividends on our
    common stock paid to a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder,</FONT>
    unless the holder has provided the required certification that
    it is a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    and the payor does not have actual knowledge (or reason to know)
    that the holder is a U.S.&#160;person. Generally, information
    will be reported to the Internal Revenue Service regarding the
    amount of dividends paid, the name and address of the recipient,
    and the amount, if any, of tax withheld. These information
    reporting requirements apply even if no tax was required to be
    withheld. A similar report is
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    125
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    sent to the recipient of the dividend and may also be made
    available to the tax authorities in the country in which the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    resides under the provisions of an applicable income tax treaty.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In general, backup withholding and information reporting will
    apply to the payment of proceeds from the disposition of our
    common stock by a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    through a U.S.&#160;office of a broker or through the
    <FONT style="white-space: nowrap">non-U.S.&#160;office</FONT>
    of a broker that is a U.S.&#160;person or has certain enumerated
    connections with the United States, unless the holder has
    provided the required certification that it is a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    and the payor does not have actual knowledge (or reason to know)
    that the holder is a U.S.&#160;person.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Backup withholding is not an additional tax. Any amounts that
    are withheld under the backup withholding rules from a payment
    to a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    will be refunded or credited against the holder&#146;s
    U.S.&#160;federal income tax liability, if any, provided that
    certain required information is furnished to the Internal
    Revenue Service.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prospective investors should consult their tax advisors
    regarding the application of the information reporting and
    backup withholding rules to them.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    126
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='119'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">UNDERWRITING</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accretive Health, the selling stockholders and the underwriters
    named below have entered into an underwriting agreement with
    respect to the shares being offered. Subject to certain
    conditions, each underwriter has severally agreed to purchase
    the number of shares indicated in the following table. Goldman,
    Sachs&#160;&#038; Co. and Credit Suisse Securities (USA) LLC are
    the joint book-running managers and representatives of the
    underwriters.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="79%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="17%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <FONT style="font-size: 10pt">Underwriters
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <FONT style="font-size: 10pt">Number of Shares
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Goldman, Sachs&#160;&#038; Co.
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Credit Suisse Securities (USA) LLC
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    J.P. Morgan Securities Inc.
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Morgan Stanley&#160;&#038; Co. Incorporated
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 50pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The underwriters are committed to take and pay for all of the
    shares being offered, if any are taken, other than the shares
    covered by the option described below unless and until this
    option is exercised.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    If the underwriters sell more shares than the total number set
    forth in the table above, the underwriters have an option to buy
    up to an additional&#160;&#160;&#160;&#160;&#160; shares from
    Accretive Health and the selling stockholders to cover such
    sales. They may exercise that option for 30&#160;days. If any
    shares are purchased pursuant to this option, the underwriters
    will severally purchase shares in approximately the same
    proportion as set forth in the table above.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following tables show the per share and total underwriting
    discounts and commissions to be paid to the underwriters by
    Accretive Health and the selling stockholders. Such amounts are
    shown assuming both no exercise and full exercise of the
    underwriters&#146; option to
    purchase&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    additional shares.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <U><FONT style="font-family: Arial, Helvetica">Paid by Accretive
    Health</FONT></U>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="70%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="11%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <FONT style="font-size: 10pt">No Exercise
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <FONT style="font-size: 10pt">Full Exercise
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Per Share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <U><FONT style="font-family: Arial, Helvetica">Paid by the
    Selling Stockholders</FONT></U>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="70%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="11%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <FONT style="font-size: 10pt">No Exercise
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <FONT style="font-size: 10pt">Full Exercise
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Per Share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Shares sold by the underwriters to the public will initially be
    offered at the initial public offering price set forth on the
    cover of this prospectus. Any shares sold by the underwriters to
    securities dealers may be sold at a discount of up to
    $&#160;&#160;&#160;&#160;&#160; per share from the initial
    public offering price. If all the shares are not sold at the
    initial public offering price, the representatives may change
    the offering price and the other selling terms.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accretive Health, its officers and directors, and holders of
    substantially all of the outstanding shares of its common stock,
    including the selling stockholders, have agreed with the
    underwriters, subject to certain exceptions, not to offer, sell,
    contract to sell, pledge, grant any option to purchase, make any
    short sale or otherwise dispose of any shares of common stock,
    options or warrants to purchase shares of common stock or
    securities convertible into, exchangeable for or that represent
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    127
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    the right to receive shares of common stock, make any demand
    for, or exercise any right with respect to, the registration of
    any shares of common stock or any securities convertible into or
    exercisable or exchangeable for shares of common stock, whether
    now owned or hereafter acquired, during the period from the date
    of this prospectus continuing through the date 180&#160;days
    after the date of this prospectus, except with the prior written
    consent of Goldman, Sachs&#160;&#038; Co. and Credit Suisse
    Securities (USA) LLC, on behalf of the underwriters. This
    agreement does not apply to any existing employee benefit plans.
    See &#147;Shares Eligible for Future Sale&#148; for a discussion
    of certain transfer restrictions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The <FONT style="white-space: nowrap">180-day</FONT>
    restricted period described in the preceding paragraph will be
    automatically extended if: (1)&#160;during the last 17&#160;days
    of the
    <FONT style="white-space: nowrap">180-day</FONT>
    restricted period Accretive Health issues an earnings release or
    announces material news or a material event; or (2)&#160;prior
    to the expiration of the
    <FONT style="white-space: nowrap">180-day</FONT>
    restricted period, Accretive Health announces that it will
    release earnings results during the
    <FONT style="white-space: nowrap">16-day</FONT>
    period beginning on the last day of the
    <FONT style="white-space: nowrap">180-day</FONT>
    period, in which case the restrictions described in the
    preceding paragraph will continue to apply until the expiration
    of the
    <FONT style="white-space: nowrap">18-day</FONT>
    period beginning on the issuance of the earnings release or the
    announcement of the material news or material event.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to the offering, there has been no public market for our
    common stock. The initial public offering price has been
    negotiated among Accretive Health and the representatives. Among
    the factors to be considered in determining the initial public
    offering price of the shares, in addition to prevailing market
    conditions, will be Accretive Health&#146;s historical
    performance, estimates of the business potential and earnings
    prospects of Accretive Health, an assessment of Accretive
    Health&#146;s management and the consideration of the above
    factors in relation to market valuation of companies in related
    businesses.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We intend to file an application to list our common stock on the
    New York Stock Exchange under the symbol &#147;AH&#148;.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In connection with the offering, the underwriters may purchase
    and sell shares of common stock in the open market. These
    transactions may include short sales, stabilizing transactions
    and purchases to cover positions created by short sales. Short
    sales involve the sale by the underwriters of a greater number
    of shares than they are required to purchase in the offering.
    &#147;Covered&#148; short sales are sales made in an amount not
    greater than the underwriters&#146; option to purchase
    additional shares from Accretive Health and the selling
    stockholders in the offering. The underwriters may close out any
    covered short position by either exercising their option to
    purchase additional shares or purchasing shares in the open
    market. In determining the source of shares to close out the
    covered short position, the underwriters will consider, among
    other things, the price of shares available for purchase in the
    open market as compared to the price at which they may purchase
    additional shares pursuant to the option granted to them.
    &#147;Naked&#148; short sales are any sales in excess of such
    option. The underwriters must close out any naked short position
    by purchasing shares in the open market. A naked short position
    is more likely to be created if the underwriters are concerned
    that there may be downward pressure on the price of the common
    stock in the open market after pricing that could adversely
    affect investors who purchase in the offering. Stabilizing
    transactions consist of various bids for or purchases of common
    stock made by the underwriters in the open market prior to the
    completion of the offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The underwriters may also impose a penalty bid. This occurs when
    a particular underwriter repays to the underwriters a portion of
    the underwriting discount received by it because the
    representatives have repurchased shares sold by or for the
    account of such underwriter in stabilizing or short covering
    transactions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Purchases to cover a short position and stabilizing
    transactions, as well as other purchases by the underwriters for
    their own accounts, may have the effect of preventing or
    retarding a decline in the market price of Accretive
    Health&#146;s stock, and together with the imposition of the
    penalty bid, may stabilize, maintain or otherwise affect the
    market price of the common stock. As a result, the price of
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    128
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    the common stock may be higher than the price that otherwise
    might exist in the open market. If these activities are
    commenced, they may be discontinued at any time. These
    transactions may be effected on the New York Stock Exchange, in
    the over-the-counter market or otherwise.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In relation to each Member State of the European Economic Area
    which has implemented the Prospectus Directive, each of which is
    referred to as a Relevant Member State, each underwriter has
    represented and agreed that with effect from and including the
    date on which the Prospectus Directive is implemented in that
    Relevant Member State, referred to as the Relevant
    Implementation Date, it has not made and will not make an offer
    of shares to the public in that Relevant Member State prior to
    the publication of a prospectus in relation to the shares which
    has been approved by the competent authority in that Relevant
    Member State or, where appropriate, approved in another Relevant
    Member State and notified to the competent authority in that
    Relevant Member State, all in accordance with the Prospectus
    Directive, except that it may, with effect from and including
    the Relevant Implementation Date, make an offer of shares to the
    public in that Relevant Member State at any time:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    to legal entities which are authorised or regulated to operate
    in the financial markets or, if not so authorized or regulated,
    whose corporate purpose is solely to invest in securities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    to any legal entity which has two or more of (1)&#160;an average
    of at least 250&#160;employees during the last financial year;
    (2)&#160;a total balance sheet of more than &#128;43,000,000;
    and (3)&#160;an annual net turnover of more than
    &#128;50,000,000, as shown in its last annual or consolidated
    accounts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    to fewer than 100 natural or legal persons (other than qualified
    investors as defined in the Prospectus Directive) subject to
    obtaining the prior consent of the representatives for any such
    offer;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    in any other circumstances which do not require the publication
    by the Issuer of a prospectus pursuant to Article&#160;3 of the
    Prospectus Directive.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    For the purposes of this provision, the expression an
    &#147;offer of shares to the public&#148; in relation to any
    shares in any Relevant Member State means the communication in
    any form and by any means of sufficient information on the terms
    of the offer and the shares to be offered so as to enable an
    investor to decide to purchase or subscribe the shares, as the
    same may be varied in that Relevant Member State by any measure
    implementing the Prospectus Directive in that Relevant Member
    State and the expression Prospectus Directive means Directive
    2003/71/EC and includes any relevant implementing measure in
    each Relevant Member State.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Each underwriter has represented and agreed that:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    it has only communicated or caused to be communicated and will
    only communicate or cause to be communicated an invitation or
    inducement to engage in investment activity (within the meaning
    of Section&#160;21 of the FSMA) received by it in connection
    with the issue or sale of the shares in circumstances in which
    Section&#160;21(1) of the FSMA does not apply to the
    Issuer;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    it has complied and will comply with all applicable provisions
    of the FSMA with respect to anything done by it in relation to
    the shares in, from or otherwise involving the United Kingdom.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The shares may not be offered or sold by means of any document
    other than (1)&#160;in circumstances which do not constitute an
    offer to the public within the meaning of the Companies
    Ordinance (Cap.32, Laws of Hong Kong), or (2)&#160;to
    &#147;professional investors&#148; within the meaning of the
    Securities and Futures Ordinance (Cap.571, Laws of Hong Kong)
    and any rules made thereunder, or (3)&#160;in other
    circumstances which do not result in the document being a
    &#147;prospectus&#148; within the meaning of the Companies
    Ordinance (Cap.32, Laws of Hong Kong), and no advertisement,
    invitation or document relating to the shares may be issued or
    may be in the possession of any person for the purpose of issue
    (in each case whether in Hong Kong or elsewhere), which is
    directed at, or the contents of which are likely to be accessed
    or read by, the public in Hong Kong (except if permitted to
</DIV>

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    <BR>
    129
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    do so under the laws of Hong Kong) other than with respect to
    shares which are or are intended to be disposed of only to
    persons outside Hong Kong or only to &#147;professional
    investors&#148; within the meaning of the Securities and Futures
    Ordinance (Cap. 571, Laws of Hong Kong) and any rules made
    thereunder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    This prospectus has not been registered as a prospectus with the
    Monetary Authority of Singapore. Accordingly, this prospectus
    and any other document or material in connection with the offer
    or sale, or invitation for subscription or purchase, of the
    shares may not be circulated or distributed, nor may the shares
    be offered or sold, or be made the subject of an invitation for
    subscription or purchase, whether directly or indirectly, to
    persons in Singapore other than (1)&#160;to an institutional
    investor under Section&#160;274 of the Securities and Futures
    Act, Chapter&#160;289 of Singapore, (2)&#160;to a relevant
    person, or any person pursuant to Section&#160;275(1A), and in
    accordance with the conditions, specified in Section&#160;275 of
    the Securities and Futures Act or (3)&#160;otherwise pursuant
    to, and in accordance with the conditions of, any other
    applicable provision of the Securities and Futures Act.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Where the shares are subscribed or purchased under
    Section&#160;275 by a relevant person which is: (a)&#160;a
    corporation (which is not an accredited investor) the sole
    business of which is to hold investments and the entire share
    capital of which is owned by one or more individuals, each of
    whom is an accredited investor; or (b)&#160;a trust (where the
    trustee is not an accredited investor) whose sole purpose is to
    hold investments and each beneficiary is an accredited investor,
    shares, debentures and units of shares and debentures of that
    corporation or the beneficiaries&#146; rights and interest in
    that trust shall not be transferable for six months after that
    corporation or that trust has acquired the shares under
    Section&#160;275 except: (1)&#160;to an institutional investor
    under Section&#160;274 of the Securities and Futures Act or to a
    relevant person, or any person pursuant to Section&#160;275(1A),
    and in accordance with the conditions, specified in
    Section&#160;275 of the Securities and Futures Act;
    (2)&#160;where no consideration is given for the transfer; or
    (3)&#160;by operation of law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The securities have not been and will not be registered under
    the Securities and Exchange Law of Japan (the Securities and
    Exchange Law) and each underwriter has agreed that it will not
    offer or sell any securities, directly or indirectly, in Japan
    or to, or for the benefit of, any resident of Japan (which term
    as used herein means any person resident in Japan, including any
    corporation or other entity organized under the laws of Japan),
    or to others for re-offering or resale, directly or indirectly,
    in Japan or to a resident of Japan, except pursuant to an
    exemption from the registration requirements of, and otherwise
    in compliance with, the Securities and Exchange Law and any
    other applicable laws, regulations and ministerial guidelines of
    Japan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The underwriters do not expect sales to discretionary accounts
    to exceed five percent of the total number of shares offered.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Upon the completion of this offering and based on an assumed
    initial public offering price of $&#160;&#160;&#160;&#160;&#160;
    per share, the midpoint of the estimated price range shown on
    the cover of this prospectus, Accretive Health will pay FT
    Partners a fee of $&#160;&#160;&#160;&#160;&#160; for financial
    advisory services in respect of this offering. This fee will be
    paid&#160;&#160;&#160;&#160;&#160;% in cash
    and&#160;&#160;&#160;&#160;&#160;% through the issuance of
    shares of our common stock valued at the initial public offering
    price per share. FT Partners has entered into a
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreement with the underwriters with respect to these shares and
    these shares will also be subject to limitations on resale
    imposed by Rule&#160;144, each as described under the heading
    &#147;Shares Eligible for Future Sale&#148; elsewhere in this
    prospectus. FT Partners&#146; financial advisory services
    included assistance in financial and valuation modeling and
    advice with respect to the initial public offering process and
    equity capital market alternatives. None of Financial Technology
    Partners, LLC, FTP Securities, LLC or any of their affiliates is
    acting as an underwriter of this offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accretive Health and the selling stockholders estimate that the
    total expenses of the offering payable by them, excluding
    underwriting discounts and commissions, will be approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;.
</DIV>

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    <BR>
    130
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accretive Health and the selling stockholders have agreed to
    indemnify the several underwriters against certain liabilities,
    including liabilities under the Securities Act of 1933.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Certain of the underwriters and their respective affiliates may
    in the future perform various financial advisory and investment
    banking services for the company, for which they received or
    will receive customary fees and expenses.
</DIV>
<A name='120'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">LEGAL
    MATTERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The validity of the common stock being offered will be passed
    upon for us by Wilmer Cutler Pickering Hale and Dorr LLP,
    Boston, Massachusetts. The underwriters are represented by
    Skadden, Arps, Slate, Meagher&#160;&#038; Flom LLP, New York,
    New York, in connection with this offering.
</DIV>
<A name='121'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">EXPERTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Ernst &#038; Young LLP, an independent registered public
    accounting firm, has audited our consolidated financial
    statements and schedule at December&#160;31, 2007 and 2008, and
    for each of the three years in the period ended
    December&#160;31, 2008, as set forth in their report. We have
    included our consolidated financial statements and schedule in
    the prospectus and elsewhere in the registration statement in
    reliance on Ernst &#038; Young LLP&#146;s report, given their
    authority as experts in accounting and auditing.
</DIV>
<A name='122'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">WHERE YOU CAN
    FIND MORE INFORMATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We have filed with the SEC a registration statement on
    <FONT style="white-space: nowrap">Form&#160;S-1</FONT>
    under the Securities Act of 1933 with respect to the shares of
    common stock to be sold in this offering. This prospectus, which
    constitutes part of the registration statement, does not include
    all of the information contained in the registration statement
    and the exhibits, schedules and amendments to the registration
    statement. Some items are omitted in accordance with the rules
    and regulations of the SEC. For further information with respect
    to us and our common stock, we refer you to the registration
    statement and to the exhibits and schedules to the registration
    statement filed as part of the registration statement.
    Statements contained in this prospectus about the contents of
    any contract or any other document filed as an exhibit are not
    necessarily complete and, and in each instance, we refer you to
    the copy of the contract or other documents filed as an exhibit
    to the registration statement. Each of theses statements is
    qualified in all respects by this reference.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    You may read and copy the registration statement of which this
    prospectus is a part at the SEC&#146;s public reference room,
    which is located at 100&#160;F&#160;Street, N.E.,
    Room&#160;1580, Washington,&#160;D.C. 20549. You can request
    copies of the registration statement by writing to the SEC and
    paying a fee for the copying cost. Please call the SEC at
    <FONT style="white-space: nowrap">1-800-SEC-0330</FONT>
    for more information about the operation of the SEC&#146;s
    public reference room. In addition, the SEC maintains an
    Internet website, located at www.sec.gov, which contains
    reports, proxy and information statements and other information
    regarding issuers that file electronically with the SEC. You may
    access the registration statement of which this prospectus is a
    part at the SEC&#146;s Internet website.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Upon the closing of this offering, we will become subject to the
    full informational and periodic reporting requirements of the
    Exchange Act. We will fulfill our obligations with respect to
    such requirements by filing periodic reports and other
    information with the SEC. We intend to furnish our stockholders
    with annual reports containing consolidated financial statements
    certified by an independent registered public accounting firm.
    We also maintain a website at www.accretivehealth.com. Our
    website is not a part of this prospectus.
</DIV>

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    <BR>
    131
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Index to
    Consolidated Financial Statements</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="97%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Page</FONT></B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#306'><B>Audited Consolidated Financial
    Statements</B></A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#300'>Report of Independent Registered Public
    Accounting Firm</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#301'>Consolidated Balance Sheets</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-3
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#302'>Consolidated Statements of Operations</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-4
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#303'>Consolidated Statements of Stockholders&#146;
    Equity</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#304'>Consolidated Statements of Cash Flows</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-7
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#305'>Notes to Consolidated Financial Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-8
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-1
</DIV><!-- END PAGE WIDTH -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='300'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Report of
    Independent Registered Public Accounting Firm</FONT></B>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Board of Directors and Shareholders
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accretive Health, Inc.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We have audited the accompanying consolidated balance sheets of
    Accretive Health, Inc. (formerly Healthcare Services Inc. d/b/a
    Accretive Health) as of December&#160;31, 2008 and 2007, and the
    related consolidated statements of operations,
    stockholders&#146; equity, and cash flows for each of the three
    years in the period ended December&#160;31, 2008. These
    financial statements are the responsibility of the
    Company&#146;s management. Our responsibility is to express an
    opinion on these financial statements based on our audits.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We conducted our audits in accordance with the standards of the
    Public Company Accounting Oversight Board (United States). Those
    standards require that we plan and perform the audit to obtain
    reasonable assurance about whether the financial statements are
    free of material misstatement. We were not engaged to perform an
    audit of the Company&#146;s internal control over financial
    reporting. Our audits included consideration of internal control
    over financial reporting as a basis for designing audit
    procedures that are appropriate in the circumstances, but not
    for the purpose of expressing an opinion on the effectiveness of
    the Company&#146;s internal control over financial reporting.
    Accordingly, we express no such opinion. An audit also includes
    examining, on a test basis, evidence supporting the amounts and
    disclosures in the financial statements, assessing the
    accounting principles used and significant estimates made by
    management, and evaluating the overall financial statement
    presentation. We believe that our audits provide a reasonable
    basis for our opinion.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In our opinion, the financial statements referred to above
    present fairly, in all material respects, the consolidated
    financial position of Accretive Health, Inc. at
    December&#160;31, 2008 and 2007, and the consolidated results of
    its operations and its cash flows for each of the three years in
    the period ended December&#160;31, 2008, in conformity with
    U.S.&#160;generally accepted accounting principles.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As disclosed in Note&#160;2 in the notes to the consolidated
    financial statements, effective January&#160;1, 2007, the
    Company adopted Financial Accounting Standards Board (FASB)
    Interpretation No.&#160;48, <I>Accounting for Uncertainty in
    Income Taxes, an interpretation of FASB Statement
    No.&#160;109.</I>
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;Ernst&#160;&#038;
    Young LLP</DIV>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Chicago, Illinois
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    May&#160;20, 2009
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-2
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <A name='301'><B><FONT style="font-family: Arial, Helvetica">Consolidated
    Balance Sheets</A><BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">(In thousands,
    except share and per share amounts)</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="66%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>June&#160;30,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B><FONT style="font-size: 10pt">2009</FONT></B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Assets</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Current assets:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34,745
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    51,656
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accounts receivable, net of allowance for doubtful accounts of
    $432, $82, and $82 at December&#160;31, 2007, 2008, and
    June&#160;30, 2009, respectively
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,897
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    20,206
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40,876
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Prepaid assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    371
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,031
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,972
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Due from related party
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    941
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,261
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,275
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Other current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,374
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    630
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    52,958
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    75,528
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    89,542
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Deferred income tax
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,542
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Furniture and equipment, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,566
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,913
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,875
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Goodwill
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,468
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,468
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,468
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,866
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    995
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    538
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    60,858
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    86,904
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    105,965
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Liabilities and stockholders&#146; equity</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Current liabilities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accounts payable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    22,146
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    38,205
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    50,880
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accrued payroll
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,592
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,147
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,095
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Deferred income tax
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,894
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accrued taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,208
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    224
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Other accrued expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,498
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,434
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,858
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Deferred revenue
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,712
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22,987
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19,477
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Current liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    44,948
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    78,981
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    85,428
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Commitments and contingencies
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stockholders&#146; equity:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Convertible preferred stock, Series&#160;A, $0.01&#160;par
    value, 32,317&#160;shares authorized, 32,317&#160;shares issued
    and outstanding at December&#160;31, 2007 and 2008, and
    June&#160;30, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Convertible preferred stock, Series&#160;D, $0.01&#160;par
    value, 1,267,224&#160;shares authorized, issued, and outstanding
    at December&#160;31, 2007 and 2008, and June&#160;30, 2009,
    respectively
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Series&#160;B common stock, $0.01&#160;par value,
    17,500,000&#160;shares authorized, 4,784,758, 8,161,361 and
    8,178,119&#160;shares issued, and outstanding at
    December&#160;31, 2007 and 2008, and June&#160;30, 2009,
    respectively
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    48
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Series&#160;C common stock, $0.01&#160;par value, 7,500,000,
    8,000,000 and 8,000,000&#160;shares authorized, 4,462,141,
    1,271,732 and 1,321,857&#160;shares issued and outstanding at
    December&#160;31, 2007 and 2008, and June&#160;30, 2009,
    respectively
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    44
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Additional paid-in capital
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32,361
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38,401
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    45,773
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Non-executive employee loans for stock option exercises
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (320
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (263
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (230
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accumulated deficit
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (16,246
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (30,101
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (24,887
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cumulative translation adjustment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (222
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (227
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,910
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,923
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    20,537
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total liabilities and stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    60,858
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    86,904
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    105,965
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    See accompanying notes to consolidated financial statements
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <A name='302'><B><FONT style="font-family: Arial, Helvetica">Consolidated
    Statements of Operations</A><BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">(In thousands,
    except share and per share amounts)</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="32%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Six Months Ended June&#160;30,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2006</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2009</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net services revenue
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    160,741
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    240,725
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    398,469
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    187,261
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    238,149
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Costs of services
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    141,767
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    197,676
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    335,211
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    160,082
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    195,667
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Operating margin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,974
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43,049
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    63,258
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,179
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42,482
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other operating expenses:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Infused management and technology
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,875
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,872
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,234
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,938
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24,482
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Selling, general, and administrative
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,777
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,657
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21,227
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,642
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,308
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,652
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43,529
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,461
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,580
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,790
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Income (loss) from operations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (8,678
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (480
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,797
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (401
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,692
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,359
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,710
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    710
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    433
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    83
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net income (loss) before provision for (benefit from) income
    taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,230
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,507
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,775
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Provision for (benefit from) income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    456
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,264
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    626
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,439
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net income (loss)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    774
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,243
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (594
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,214
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net income (loss) per common share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Basic
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (0.89
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.04
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (0.70
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (0.06
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Diluted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1.02
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.03
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (0.73
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (0.06
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Weighted-average shares used in calculating net income (loss)
    per common share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Basic
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,611,975
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,410,226
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,214,916
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,160,187
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,337,812
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Diluted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,611,975
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,296,011
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,214,916
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,160,187
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,492,646
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    See accompanying notes to consolidated financial statements
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-4
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- LANDSCAPE -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <A name='303'><B><FONT style="font-family: Arial, Helvetica">Consolidated
    Statements of Stockholders&#146; Equity</A><BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">(In thousands,
    except share amounts)</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 7pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="29%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=08 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=08 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=08 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=08 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=09 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=09 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=09 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=09 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=10 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=10 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=10 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=10 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=11 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=11 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=11 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=11 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=12 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=12 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=12 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=12 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=13 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=13 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=13 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=13 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=14 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=14 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=14 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=14 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=15 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=15 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=15 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=15 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Convertible<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Convertible<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Loans<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Preferred Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Preferred Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Class B<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Class C<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Additional<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>for Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Cumulative<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Series A</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Series D</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Common Stock</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Common Stock</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Paid-In<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Option<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Accumulated<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Translation<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Comprehensive<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Shares</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Amount</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Shares</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Amount</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Shares</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Amount</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Shares</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Amount</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Capital</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Exercises</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Deficit</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Adjustment</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Total</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Income (Loss)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Balance at January&#160;1, 2006
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32,317
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,267,224
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,902,374
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    39
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,633,284
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    36
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    18,148
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (9,701
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,535
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Issuance of class&#160;C common stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    99,757
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    524
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    525
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Issuance of warrants
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    83
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    83
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Exercise of vested stock options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    485,390
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    858
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    863
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Amounts loaned to employees related to stock option exercises,
    net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (365
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (365
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Compensation expense related to restricted common stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Compensation expense related to stock options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    794
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    794
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Balance at December&#160;31, 2006
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32,317
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,267,224
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,902,374
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    39
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,218,431
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    20,457
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (365
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (17,020
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,166
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
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</TD>
<TD>
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</TD>
<TD style="border-top: 3px double #000000">
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</TD>
<TD>
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</TD>
<TD>
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</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
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</TD>
<TD>
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</TD>
<TD style="border-top: 3px double #000000">
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</TD>
<TD style="border-top: 3px double #000000">
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</TD>
<TD>
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</TD>
<TD>
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</TD>
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</TD>
<TD style="border-top: 3px double #000000">
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</TD>
<TD>
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</TD>
<TD>
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</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
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</TD>
<TD>
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</TD>
<TD>
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</TD>
<TD style="border-top: 3px double #000000">
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</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
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</TD>
<TD>
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</TD>
<TD style="border-top: 3px double #000000">
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</TD>
<TD style="border-top: 3px double #000000">
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</TD>
<TD>
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</TD>
<TD>
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</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
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</TD>
<TD>
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</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
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</TD>
<TD>
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</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
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</TD>
<TD>
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</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Issuance of class&#160;B common stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    882,384
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,481
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,490
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Issuance of class&#160;C common stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,899
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    327
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    327
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Exercise of vested stock options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,021
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Vesting of previously exercised options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    253,811
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    697
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    700
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Repayments of amounts loaned to employees related to stock
    option exercises, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    45
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    45
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Share repurchases
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (66,021
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (655
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (656
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Issuance of stock warrants
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,081
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,081
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Compensation expense related to restricted common stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Compensation expense related to stock options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    896
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    896
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Currency translation adjustments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Net income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    774
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    774
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    774
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Balance at December&#160;31, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32,317
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,267,224
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,784,758
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    48
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,462,141
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    44
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    32,361
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (320
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (16,246
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    15,910
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    784
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-5
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- LANDSCAPE -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Consolidated
    Statements of Stockholders&#146; Equity&#160;&#151;
    (Continued)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">(In thousands,
    except share amounts)</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 7pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="28%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=08 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=08 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=08 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=08 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=09 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=09 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=09 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=09 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=10 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=10 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=10 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=10 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=11 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=11 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=11 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=11 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=12 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=12 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=12 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=12 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=13 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=13 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=13 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=13 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=14 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=14 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=14 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=14 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=15 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=15 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=15 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=15 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Convertible<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Convertible<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Loans<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Preferred Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Preferred Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Class B<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Class C<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Additional<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>for Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Cumulative<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Series A</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Series D</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Common Stock</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Common Stock</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Paid-In<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Option<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Accumulated<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Translation<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Comprehensive<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Shares</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Amount</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Shares</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Amount</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Shares</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Amount</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Shares</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Amount</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Capital</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Exercises</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Deficit</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Adjustment</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Total</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Income (Loss)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Implementation of FASB Interpretation No.&#160;48
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (97
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (97
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Exchange of Series&#160;C to Series&#160;B Stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,309,951
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3,309,951
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (33
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Issuance of class&#160;B common stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    66,652
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Exercise of vested stock options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Vesting of previously exercised options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    150,375
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    649
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    651
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Repayments (advances) of amounts loaned to employees related to
    stock option exercises, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    57
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
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<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    57
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Share repurchases
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (34,583
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,510
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,510
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Issuance of stock warrants
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,332
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,332
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Compensation expense related to restricted common stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Compensation expense related to stock options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,546
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,546
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Currency translation adjustments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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&nbsp;
</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (232
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (232
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (232
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Dividends declared
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
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    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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&nbsp;
</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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&nbsp;
</TD>
<TD>
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</TD>
<TD>
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</TD>
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&nbsp;
</TD>
<TD>
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&nbsp;
</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (15,001
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (15,001
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Net income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,243
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,243
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,243
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Balance at December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32,317
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,267,224
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,161,361
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,271,732
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    38,401
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (263
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (30,101
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (222
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,923
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,011
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Exercise of vested stock options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    20,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    147
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    147
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Vesting of previously exercised options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30,125
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    141
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    141
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Issuance of class&#160;B common stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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</TD>
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    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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&nbsp;
</TD>
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    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,758
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
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    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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&nbsp;
</TD>
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    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
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</TD>
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</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Repayments of amounts loaned to employees related to stock
    option exercises, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
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</TD>
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</TD>
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</TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Issuance of stock warrants
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,107
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,107
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Compensation expense related to stock options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,977
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,977
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Currency translation adjustments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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&nbsp;
</TD>
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    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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&nbsp;
</TD>
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    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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</TD>
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    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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&nbsp;
</TD>
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    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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</TD>
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    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
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</TD>
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    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Net income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,214
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,214
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,214
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -7pt; margin-left: 7pt">
    Balance at June&#160;30, 2009 (unaudited)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32,317
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,267,224
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,178,119
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,321,857
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    45,773
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (230
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (24,887
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (227
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    20,537
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,209
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    See accompanying notes to consolidated financial statements
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-6
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <A name='304'><B><FONT style="font-family: Arial, Helvetica">Consolidated
    Statements of Cash Flows<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">(In
    thousands)</FONT></B></A>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="58%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Six Months Ended June&#160;30,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2006</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2007</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2009</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <B>Operating activities</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net income (loss)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    774
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,243
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (594
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,214
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Adjustments to reconcile net income (loss) to net cash provided
    by (used in) operations:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 17pt">
    Depreciation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    277
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    530
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,030
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    574
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    950
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 17pt">
    Amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    349
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    777
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,510
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    346
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    932
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 17pt">
    Employee stock based compensation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    844
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    934
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,551
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,021
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,977
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 17pt">
    Expense associated with the issuance of stock warrants
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    83
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,081
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,332
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,080
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,107
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 17pt">
    Deferred income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,648
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 17pt">
    Changes in operating assets and liabilities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 25pt">
    Accounts receivable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    234
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (15,091
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4,309
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    937
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (20,669
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 25pt">
    Prepaid and other current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (76
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,182
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,381
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (832
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,207
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 25pt">
    Accounts payable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,164
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,286
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,074
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,624
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,678
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 25pt">
    Accrued payroll
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    468
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,263
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,563
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,959
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4,053
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 25pt">
    Other accrued expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (457
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,864
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,359
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,632
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    560
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 25pt">
    Accrued income tax
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,208
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    160
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (984
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 25pt">
    Deferred revenue
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,423
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,599
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,275
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5,077
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3,510
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 25pt">
    Loss on disposal of equipment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    70
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net cash provided by (used in) operating activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,990
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,835
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,525
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,912
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (11,653
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <B>Investing activities</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Purchase of SureDecisions net of cash acquired
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,419
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (211
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Purchases of furniture and equipment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (412
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,837
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,843
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,006
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,037
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Acquisition of software
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (915
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,639
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4,988
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,609
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,790
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Customer incentive advance
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    416
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    698
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    293
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    444
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net cash used in investing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4,746
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3,271
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,133
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,322
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,383
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <B>Financing activities</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Proceeds from issuance of class&#160;B common stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,490
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Proceeds from issuance of class&#160;C common stock from
    employee stock option exercise
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,345
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    510
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    150
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    150
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    151
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Collection (issuance) of non-executive employee notes receivable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (365
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    45
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    57
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (545
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Payment of dividends
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (15,001
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Repurchase of common stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (656
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,510
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net cash provided by (used in) financing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,980
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,389
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (16,303
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (394
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    184
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Effect of exchange rate changes in cash
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (178
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (45
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (15
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net increase (decrease) in cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,224
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,963
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,911
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,151
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,867
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cash and cash equivalents at beginning of year
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,558
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    20,782
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34,745
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34,745
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    51,656
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cash and cash equivalents at end of year
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    20,782
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34,745
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    51,656
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    41,896
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,789
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <B>Supplemental disclosures of cash flow information</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Interest paid
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Taxes paid
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    791
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,137
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    536
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,215
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Exercise of unvested stock options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,482
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    471
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    132
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    132
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <B>Supplemental disclosures of noncash financing transactions</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Shares issued in connection with the acquisition of SureDecisions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    525
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    327
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Issuance of notes receivable to non-executive employees
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (365
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (585
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (585
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Vesting of previously exercised stock options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    700
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    651
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    157
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    141
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    See accompanying notes to consolidated financial statements
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-7
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <A name='305'><B><FONT style="font-family: Arial, Helvetica">Notes
    to Consolidated Financial Statements</FONT></B></A>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">1.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Description of
    Business</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accretive Health, Inc. (the &#147;Company&#148;) is a leading
    provider of healthcare revenue cycle management services. The
    Company&#146;s business purpose is to help U.S.&#160;hospitals,
    physicians and other healthcare providers manage their revenue
    cycle operations more efficiently. The Company&#146;s
    integrated, end-to-end technology and services offering, which
    is referred to as Accretive&#146;s solution, helps customers
    realize sustainable improvements in their operating margins and
    improve the satisfaction of their patients, physicians and
    staff. The Company enables these improvements by helping
    customers increase the portion of the maximum potential revenue
    received while reducing total revenue cycle costs.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">2.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Summary of
    Significant Accounting Policies</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Basis of
    Presentation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The consolidated financial statements include the Company and
    its wholly owned subsidiaries, SureDecisions, Inc.
    (&#147;SureDecisions&#148;), Accretive Health India Private
    Limited, and Accretive Health India Service Private Limited. All
    intercompany transactions and balances have been eliminated in
    consolidation. These financial statements have been prepared in
    accordance with accounting principles generally accepted in the
    United States.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Unaudited
    Interim Financial Statements</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The accompanying interim consolidated balance sheet as of
    June&#160;30, 2009, the statement of stockholders&#146; equity
    for the six months ended June&#160;30, 2009 and the consolidated
    statements of operations and cash flows for the six months ended
    June&#160;30, 2008 and 2009 are unaudited and have been prepared
    in accordance with the rules and regulations of the
    U.S.&#160;Securities and Exchange Commission. They do not
    include all of the information and footnotes required by
    accounting principles generally accepted in the United States
    for complete financial statements. The unaudited interim
    consolidated financial statements have been prepared on the same
    basis as the audited consolidated financial statement and, in
    the opinion of the Company&#146;s management, reflect all
    adjustments consisting of normal recurring accruals considered
    necessary to present fairly the Company&#146;s financial
    position as of June&#160;30, 2009 and results of its operations
    and its cash flows for the six months ended June&#160;30, 2008
    and 2009. The results of operations for the six months ended
    June&#160;30, 2009 are not necessarily indicative of the results
    that may be expected for the year ending December&#160;31, 2009.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Use of
    Estimates</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The preparation of financial statements in conformity with
    accounting principles generally accepted in the United States
    requires management to make estimates and assumptions that
    affect the reported amounts of assets and liabilities, the
    disclosure of contingent assets and liabilities at the date of
    the consolidated financial statements, and the reported amounts
    of revenues and expenses during the reporting period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company regularly evaluates its accounting policies and
    estimates. In general, estimates are based on historical
    experience and on assumptions believed to be reasonable given
    the Company&#146;s operating environment. These estimates are
    based on management&#146;s best knowledge of current events and
    actions the Company may undertake in the future. Actual results
    may differ from these estimates.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-8
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Revenue
    Recognition</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of June&#160;30, 2009, the Company has entered into managed
    service contracts with 21 customers. The Company&#146;s managed
    service contracts generally have an initial term of four to five
    years and various start and end dates. After the initial terms,
    these contracts renew annually unless canceled by either party.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company records net services revenue in accordance with the
    provisions of Staff Accounting Bulletin&#160;104. As a result,
    the Company only records revenue once there is persuasive
    evidence of an arrangement, services have been rendered, the
    amount of revenue has become fixed or determinable and
    collectibility is reasonably assured. The Company recognizes
    base fee revenues on a straight-line basis over the life of the
    contract. Base fees for managed service contracts which are
    received in advance of services delivered are classified as
    deferred revenue until services have been provided.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company&#146;s managed service contracts generally allow for
    adjustments to the base fee. Adjustments typically occur at 90,
    180 or 360&#160;days after the contract commences, but can also
    occur at subsequent dates as a result of factors including
    changes to the scope of operations and internal and external
    audits. All adjustments, the timing of which is often dependent
    on factors outside of the Company&#146;s control and which can
    increase or decrease revenue and operating margin, are recorded
    in the period the changes are known and collectibility is
    reasonably assured. Any such adjustments may cause the
    Company&#146;s quarter-to-quarter results of operations to
    fluctuate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company records revenue for incentive payments once the
    calculation of the incentive payment earned is finalized and
    collectibility is reasonably assured. The Company uses a
    proprietary technology and methodology to calculate the amount
    of benefit each customer receives as a result of the
    Company&#146;s services. The Company&#146;s calculations are
    based in part on the amount of revenue each customer is entitled
    to receive from commercial and private insurance carriers,
    Medicare, Medicaid and patients. Because the laws, regulations,
    instructions, payor contracts and rule interpretations governing
    how the Company&#146;s customers receive payments from these
    parties are complex and change frequently, estimates of prior
    period net revenue yield calculations could change. All changes
    in estimates are recorded when new information is available and
    calculations are completed.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Incentive payments are based on the benefits a customer has
    received throughout the life of the contract. Each quarter, the
    Company records the increase in the total benefits received to
    date. If a quarterly calculation indicates that the cumulative
    benefits to date have decreased, the Company records a reduction
    in revenue. If the decrease in revenue exceeds the amount
    previously paid by the customer, the excess is recorded as
    deferred revenue.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company&#146;s services also include collection of dormant
    patient accounts receivable that have aged 365&#160;days or more
    directly from individual patients. The Company shares all cash
    generated from these collections with its customers in
    accordance with specified arrangements. The Company records as
    revenue its portion of the cash received from these collections
    when each customer&#146;s cash application is complete.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Cash and Cash
    Equivalents</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company considers all highly liquid investments with a
    maturity of three months or less when purchased to be cash
    equivalents.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-9
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Allowance for
    Uncollectible Accounts Receivable</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company extends unsecured credit to its customers based on
    its assessment of each customer&#146;s creditworthiness. The
    Company maintains an estimated allowance for doubtful accounts
    to reduce its gross accounts receivable to the amount that it
    believes will be collected. This allowance is based on the
    Company&#146;s historical experience, its assessment of each
    customer&#146;s ability to pay and the status of any ongoing
    operations with each applicable customer.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Fair Value of
    Financial Instruments</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The fair values of cash, other current assets, and current
    liabilities approximate their carrying value due to the
    short-term nature of these financial instruments.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Furniture and
    Equipment</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Furniture and equipment are stated at cost, less accumulated
    depreciation determined on the straight-line method over the
    estimated useful lives of the assets as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="50%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="48%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Leasehold improvements
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Shorter of 5&#160;years or lease term
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Office furniture
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    5&#160;years
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Capitalized software
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    3 to 5&#160;years
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Computers and other equipment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    3&#160;years
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Software
    Development</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company applies the provisions of the American Institute of
    Certified Public Accountants&#146; Statement of Position
    <FONT style="white-space: nowrap">No.&#160;98-1</FONT>
    <FONT style="white-space: nowrap">(&#147;SOP&#160;98-1&#148;),</FONT>
    <I>Accounting for Costs of Computer Software Developed or
    Obtained for Internal Use</I>, which requires the capitalization
    of costs incurred in connection with developing or obtaining
    internal use software. In accordance with
    <FONT style="white-space: nowrap">SOP&#160;98-1,</FONT>
    the Company capitalizes the costs of internally-developed,
    internal use, software when an application is in the development
    stage. This generally occurs after the overall design and
    functionality of the application has been approved and
    management has committed to the application&#146;s development.
    Capitalized software development costs consist of payroll and
    payroll-related costs for employee time spent developing a
    specific internal use software application, and external costs
    incurred that are related directly to the development of a
    specific application.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Goodwill</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Goodwill represents the excess purchase price over the net
    assets acquired for SureDecisions, which the Company acquired in
    May 2006. In accordance with Statement of Financial Accounting
    Standards (&#147;SFAS&#148;) No.&#160;142, <I>Goodwill and Other
    Intangible Assets</I>, goodwill is not subject to amortization
    but is subject to impairment testing at least annually. The
    Company&#146;s annual impairment assessment date is the first
    date of the fourth quarter. The Company conducts its impairment
    testing on a company-wide basis because it has only one
    reporting unit. The Company&#146;s impairment tests are based on
    its current business strategy in light of present industry and
    economic conditions and future expectations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As the Company applies its judgment to estimate future cash
    flows and an appropriate discount rate, the analysis reflects
    assumptions and uncertainties. The Company&#146;s estimates of
    future cash flows could differ from actual results. The
    Company&#146;s most recent impairment assessment did not result
    in goodwill impairment.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-10
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Foreign
    Currency</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The functional currency of each entity in the Company is its
    respective local currency, which is also the currency of the
    primary economic environment in which it operates. Transactions
    in foreign currencies are re-measured into functional currency
    at the rates of exchange prevailing on the date of the
    transaction. All transaction foreign exchange gains and losses
    are recorded in the accompanying consolidated statements of
    operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The assets and liabilities of the subsidiaries which use a
    functional currency other than the U.S.&#160;dollar are
    translated into U.S.&#160;dollars at the rate of exchange
    prevailing on the balance sheet dates. Revenues and expenses are
    translated into U.S.&#160;dollars at the average exchange rate
    during each month. Resulting translation adjustments are
    included in accumulated other comprehensive income (loss).
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Impairments of
    Long-Lived Assets</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company evaluates all of its long-lived assets, such as
    furniture, equipment, software and other intangibles, for
    impairment in accordance with Statement of Financial Accounting
    Standard No.&#160;144, <I>Accounting for the Impairment or
    Disposal of Long-Lived Assets</I>, when events or changes in
    circumstances warrant such a review. If an evaluation is
    required, the estimated future undiscounted cash flows
    associated with the asset are compared to the asset&#146;s
    carrying amount to determine if an adjustment to fair market
    value is required.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    See Note&#160;8 for discussion of the impairment loss recorded
    for customer relationships in 2008.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Income
    Taxes</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company records deferred tax assets and liabilities for
    future income tax consequences that are attributable to
    differences between the carrying amount of assets and
    liabilities for financial statement purposes and the income tax
    bases of such assets and liabilities. Deferred tax assets and
    liabilities are measured based on enacted tax rates that are
    expected to apply in the year that the temporary differences are
    expected to be settled. Deferred tax assets and liabilities are
    adjusted for changes in income tax rates in the period that
    includes the enactment date. A valuation allowance for deferred
    tax assets is provided if, based upon the available evidence, it
    is more likely than not that some or all of the deferred tax
    assets will not be realized.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2008 and in all prior periods, a
    valuation allowance was provided for all net deferred tax
    assets. As a result of the Company&#146;s improved operations,
    in the second quarter of 2009 the Company determined that it was
    no longer necessary to maintain a valuation allowance for all of
    its deferred tax assets, and therefore released the allowance of
    $3.5&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Beginning January&#160;1, 2008, with the adoption of FASB
    Interpretation No.&#160;48, <I>Accounting for Uncertainty in
    Income Taxes</I>, or FIN&#160;48, the Company recognizes the
    financial statement effects of a tax position only when it is
    more likely than not that the position will be sustained upon
    examination. Tax positions taken or expected to be taken that
    are not recognized under the pronouncement are recorded as
    liabilities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As a result of the Company&#146;s adoption of FIN&#160;48, the
    Company recognized a $0.2&#160;million increase to reserves for
    uncertain tax positions, of which, $0.1&#160;million was
    recorded as a cumulative effect adjustment to retained earnings.
    The remaining $0.1&#160;million related to current year changes
    and was recorded as an expense in 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company recognizes interest and penalties relating to income
    tax matters in the income tax provision.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-11
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Share-Based
    Compensation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Share-based compensation expense results from awards of
    restricted common stock and grants of stock options and warrants
    to employees, directors, outside consultants, customers, vendors
    and others. The Company recognizes the costs associated with
    option and warrant grants using the fair value recognition
    provisions of Statement of Financial Accounting Standards
    No.&#160;123(R), <I>Share-Based Payment</I>, Generally,
    SFAS&#160;123(R) requires the value of all share-based payments
    to be recognized in the statement of operations based on their
    estimated fair value at date of grant amortized over the
    grant&#146;s vesting period.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Legal
    Proceedings</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In the normal course of business, the Company is involved in
    legal proceedings or regulatory investigations. The Company
    evaluates the need for loss accruals using the requirements of
    SFAS&#160;No.&#160;5, <I>Accounting for Contingencies</I>. When
    conducting this evaluation, the Company considers factors such
    as the probability of an unfavorable outcome and the ability to
    make a reasonable estimate of the amount of loss. The Company
    records an estimated loss for any claim, lawsuit, investigation
    or proceeding when it is probable that a liability has been
    incurred and the amount of the loss can reasonably be estimated.
    If the reasonable estimate of a probable loss is a range, and no
    amount within the range is a better estimate, then the Company
    records the minimum amount in the range as its loss accrual. If
    a loss is not probable or a probable loss cannot be reasonably
    estimated, no liability is recorded.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">New Accounting
    Standards and Disclosures</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In December 2007, the Financial Accounting Standards Board
    (&#147;FASB&#148;) issued Statement of Financial Accounting
    Standards (&#147;SFAS&#148;) No.&#160;141(R), <I>Business
    Combinations</I>. SFAS&#160;No.&#160;141(R) requires the Company
    to continue to follow the guidance in SFAS&#160;No.&#160;141 for
    certain aspects of business combinations, with additional
    guidance provided defining the acquirer, recognizing and
    measuring the identifiable assets acquired, the liabilities
    assumed, any noncontrolling interest in the acquiree, assets and
    liabilities arising from contingencies, defining a bargain
    purchase, and recognizing and measuring goodwill or a gain from
    a bargain purchase. In addition, under
    SFAS&#160;No.&#160;141(R), adjustments associated with changes
    in tax contingencies that occur after the measurement period,
    not to exceed one year, are recorded as adjustments to income.
    This statement is effective for all business combinations for
    which the acquisition date is on or after the beginning of an
    entity&#146;s first fiscal year that begins after
    December&#160;15, 2008; however, the guidance in this standard
    regarding the treatment of income tax contingencies is
    retroactive to business combinations completed prior to
    January&#160;1, 2009. The Company adopted
    SFAS&#160;No.&#160;141(R) on January&#160;1, 2009. The adoption
    had no material impact on the Company&#146;s consolidated
    financial statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In April 2008, the FASB issued FASB Staff Position
    (&#147;FSP&#148;)
    <FONT style="white-space: nowrap">SFAS&#160;142-3,</FONT>
    <I>&#147;Determination of the Useful Life of Intangible
    Assets</I>&#148;. This FSP amends the factors that should be
    considered in developing renewal or extension assumptions used
    to determine the useful life of a recognized intangible asset
    under SFAS&#160;No.&#160;142. The intent of this FSP is to
    improve the consistency between the useful life of a recognized
    intangible asset under SFAS&#160;No.&#160;142 and the period of
    expected cash flows used to measure the fair value of the asset
    under SFAS&#160;No.&#160;141R and other United States generally
    accepted accounting principles. This FSP is effective for
    financial statements issued for fiscal years beginning after
    December&#160;15, 2008, and interim periods within those fiscal
    years. The Company adopted this FSP January&#160;1, 2009. The
    adoption of this FSP did not have an impact on the consolidated
    financial statements.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-12
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In June 2008, the FASB issued FSP Emerging Issues Task Force
    (&#147;EITF&#148;)
    <FONT style="white-space: nowrap">03-6-1,</FONT>
    &#147;<I>Determining Whether Instruments Granted in Share-Based
    Payment Transactions Are Participating Securities</I>&#148;. FSP
    <FONT style="white-space: nowrap">EITF&#160;03-6-1</FONT>
    addresses whether instruments granted in share-based payment
    transactions are participating securities prior to vesting and,
    therefore, need to be included in the earnings allocation in
    computing earnings per share under the two-class method. This
    FSP is effective for financial statements issued for fiscal
    years beginning after December&#160;15, 2008 and interim periods
    within those years. The Company adopted this FSP effective
    January&#160;1, 2009. See Note&#160;15.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In April 2009, the FASB issued FSP
    <FONT style="white-space: nowrap">SFAS&#160;107-1</FONT>
    and Accounting Principles Board (APB)
    <FONT style="white-space: nowrap">28-1,</FONT>
    &#147;<I>Interim Disclosures about Fair Value of Financial
    Instruments</I>&#148;. This FSP, which amends
    SFAS&#160;No.&#160;107, &#147;<I>Disclosures about Fair Value of
    Financial Instruments</I>&#148;, requires publicly-traded
    companies, as defined in APB Opinion No.&#160;28,
    &#147;<I>Interim Financial Reporting</I>&#148;, to provide
    disclosures on the fair value of financial instruments in
    interim financial statements. Since FSP
    <FONT style="white-space: nowrap">SFAS&#160;107-1</FONT>
    requires only additional disclosures concerning the financial
    instruments, the adoption of FSP
    <FONT style="white-space: nowrap">SFAS&#160;107-1</FONT>
    effective June&#160;30, 2009, did not have a material impact on
    the condensed consolidated financial statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In May 2009, the FASB issued SFAS&#160;No.&#160;165,
    &#147;<I>Subsequent Events</I>&#148;
    (&#147;SFAS&#160;165&#148;). SFAS&#160;No.&#160;165 establishes
    general standards of accounting for and disclosures of
    subsequent events that occur after the balance sheet date but
    prior to the issuance of financial statements. The statement
    requires additional disclosure regarding the date through which
    subsequent events have been evaluated by the entity as well as
    whether that date is the date the financial statements were
    issued. This statement became effective for the Company&#146;s
    financial statements as of June&#160;30, 2009. The Company has
    evaluated its subsequent events after the balance sheet date of
    June&#160;30, 2009 through September&#160;24, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In June 2009, FASB issued SFAS&#160;No.&#160;168, <I>&#147;The
    FASB Accounting Standards Codification and the Hierarchy of
    Generally Accepted Accounting Principles, a replacement of FASB
    Statement No.&#160;162 </I>(or
    &#147;SFAS&#160;No.&#160;168&#148;). SFAS&#160;No.&#160;168
    identifies the sources of accounting principles and the
    framework for selecting the principles to be used in the
    preparation of financial statements that are presented in
    conformity with generally accepted accounting principles in the
    United States. SFAS&#160;No.&#160;168 is effective for financial
    statements issued for interim and annual periods ending after
    September&#160;15, 2009. The Company does not expect the
    adoption of SFAS&#160;No.&#160;168 to have a significant impact
    on its consolidated financial statements.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">3.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Net Services
    Revenue</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company&#146;s net services revenue consisted of the
    following for each of the three years ending December&#160;31,
    and six months ended June 30 (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="36%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Six Months<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Ended June&#160;30,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2006</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2009</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net base fees for managed service contracts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    149,529
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    212,086
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    350,085
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    167,085
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    205,017
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Incentive payments for managed service contracts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,784
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,491
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38,971
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,483
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,018
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other services
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,428
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,148
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,413
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,693
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,114
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    160,741
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    240,725
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    398,469
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    187,261
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    238,149
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-13
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 05 -->

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">4.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Infused
    Management and Technology Expenses</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Infused management and technology expenses consist primarily of
    the wages, bonuses, benefits, share based compensation, travel
    and other costs associated with deploying the Company&#146;s
    employees on customer sites to guide and manage customers&#146;
    revenue cycle operations. The employees that the Company deploys
    on customer sites typically have significant experience in
    revenue cycle operations, technology, quality control or other
    management disciplines. The other significant portion of these
    expenses is an allocation of the costs associated with
    maintaining, improving and deploying the Company&#146;s
    integrated proprietary technology suite and an allocation of the
    amortization relating to software development costs capitalized.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 05 -->

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">5.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Segments and
    Concentrations</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    All of the Company&#146;s significant operations are organized
    around the single business of providing end-to-end management
    services of revenue cycle operations for
    <FONT style="white-space: nowrap">U.S.-based</FONT>
    hospitals and other medical providers. Accordingly, for purposes
    of disclosure under SFAS&#160;No.&#160;131, <I>Disclosure about
    Segments of an Enterprise and Related Information</I>, the
    Company has only one operating and reporting segment.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    All of the Company&#146;s net services revenue and trade
    accounts receivable are derived from healthcare providers
    domiciled in the United States.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    While managed independently and governed by separate contracts,
    several of the Company&#146;s customers are affiliated with a
    single health care system, Ascension Health. Pursuant to the
    Company&#146;s master services agreement with Ascension Health,
    the Company provides services to Ascension Health&#146;s
    affiliated hospitals that execute separate contracts with the
    Company. The Company&#146;s aggregate net services revenue from
    these hospitals was $142.6&#160;million, $214.2&#160;million,
    $281.7&#160;million, $136.7&#160;million, and
    $151.6&#160;million during the years ended December&#160;31,
    2006, 2007 and 2008, and six months ended June&#160;30, 2008,
    and 2009, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In addition, another customer, which is not affiliated with
    Ascension Health, accounted for 11.5% of the Company&#146;s
    total net services revenue in the six months ended June&#160;30,
    2008 and 10.6% of the Company&#146;s total net services revenue
    in the year ended December&#160;31, 2008. No other customer
    accounted for more than 10% of the Company&#146;s total net
    services revenue in any of the periods presented.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 05 -->

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">6.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">SureDecisions
    Acquisition</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company acquired SureDecisions pursuant to an Agreement and
    Plan of Merger dated May&#160;1, 2006, and SureDecisions became
    a wholly-owned subsidiary of the Company. The Company acquired
    SureDecisions for $1.6&#160;million in cash and
    99,757&#160;shares of the Company&#146;s Series&#160;C common
    stock valued at $5.26 per share. The resulting total purchase
    price was $2.1&#160;million. The acquisition was accounted for
    using the purchase method of accounting. As a result, the assets
    acquired and liabilities assumed were recorded at estimated fair
    value.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The merger agreement provided for adjustments in the purchase
    price based on a final determination of SureDecisions net
    working capital as of the date of the acquisition. This final
    determination was completed during 2007 and resulted in a
    $0.4&#160;million purchase price reduction, which was recorded
    as a reduction in goodwill.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The merger agreement also provided for potential earn-out
    payments at the first three anniversaries of the acquisition if
    certain operational targets were met. The actual first year
    earn-out payment was $0.9&#160;million, consisting of
    $0.6&#160;million in cash and 39,899&#160;shares of
    Series&#160;C common stock valued at $8.20 per share. The
    Company recorded the first year earn-out as an increase in
    goodwill.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-14
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The operational targets relating to earn-outs were not achieved
    in the second or third years, and, accordingly, the Company made
    no further earn-out payments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth the final purchase price
    allocation, adjusted for the purchase price adjustment and first
    year earn-out payment (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="91%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Receivables related to income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    939
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    509
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Property and equipment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    85
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Noncompete agreements
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    66
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Software
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    779
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Trade name
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    107
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Customer relationships
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    224
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Goodwill
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,468
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Liabilities related to income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (939
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other current liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (559
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,679
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company&#146;s consolidated statement of operations for the
    year ended December&#160;31, 2006 includes results for
    SureDecisions for the period from May&#160;2, 2006 to
    December&#160;31, 2006. A pro forma presentation of the
    Company&#146;s consolidated statement of operations that
    includes results for SureDecisions for the period beginning
    January&#160;1, 2006 would not be materially different from the
    consolidated results presented herein.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth a reconciliation of the amount
    recorded as goodwill during the year ended December&#160;31,
    2007 (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="91%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Balance as of December&#160;31, 2006
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    930
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Increase due to year one earn-out
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    910
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Decrease due to working capital adjustments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (372
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Balance as of December&#160;31, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,468
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    There were no changes in goodwill during the year ended
    December&#160;31, 2008, or during the six months ended
    June&#160;30, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Pursuant to the merger agreement, the prior stockholders of
    SureDecisions, a majority of which are now employees of the
    Company, are obligated to indemnify the Company for federal and
    state income taxes related to periods up to and including the
    date of the acquisition. The net amount due to the Company
    related to this indemnity was $0.9&#160;million,
    $1.3&#160;million and $1.3&#160;million, as of December&#160;31,
    2007 and 2008, and June&#160;30, 2009, respectively, and is
    presented as &#147;Due from Related Party&#148; in the
    consolidated balance sheets. This amount is secured by
    139,671&#160;shares of the Company&#146;s Series&#160;C common
    stock held in escrow.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-15
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">7.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Furniture and
    Equipment</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Furniture and equipment consist of the following (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="58%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="16%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Six Months<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Ended June&#160;30,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2009</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Construction in progress
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    113
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    196
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Capitalized software
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,504
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,443
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,587
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Computer equipment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,323
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,120
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,631
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Leasehold improvements
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,107
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,117
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,143
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other equipment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    111
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    621
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    625
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Office furniture
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    579
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    742
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    798
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,624
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,156
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,980
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Less accumulated depreciation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,058
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4,243
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,105
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,566
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    8,913
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    9,875
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">8.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Impairment
    Loss</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In 2008, the Company determined that the customers served by
    SureDecisions at the time of its acquisition by the Company were
    unlikely to generate significant future revenues. As a result,
    management considered the customer relationships intangible
    asset to be impaired and have no future economic value.
    Therefore, the $0.1&#160;million remaining net book value of
    this asset was charged to amortization expense at
    December&#160;31, 2008, which is included in selling, general,
    and administrative expenses in the consolidated statement of
    operations. There have been no further impairments through
    June&#160;30, 2009.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">9.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Non-Executive
    Employee Promissory Notes</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In March 2006, certain non-executive employees of the Company
    exercised options to purchase an aggregate of
    1,083,201&#160;shares of Series&#160;C common stock. To
    facilitate this stock option exercise, the Company permitted
    these employees to deliver promissory notes to the Company
    representing the exercise price related to these option
    exercises. The aggregate amount loaned to employees for this
    purpose was approximately $0.4&#160;million. Certain employees
    elected under Section&#160;83(b) of the Internal Revenue Code to
    be taxed on the difference between the stock&#146;s fair value
    at the purchase date and the option exercise price. In addition,
    pursuant to the promissory notes, the Company advanced an
    additional $0.1&#160;million to such employees to facilitate the
    payment of such federal and state income tax obligations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Each of the individual promissory notes bears interest at 5% per
    annum. The principal of each note is payable annually in five
    equal installments, commencing on March&#160;1, 2007. Each
    promissory note is secured by the shares of the Company&#146;s
    Class&#160;C common stock associated with the employee&#146;s
    stock option exercise. If an employee sells any shares issued
    pursuant to his or her stock option exercise, then a pro rata
    portion of the associated promissory note becomes immediately
    due. Any unpaid balance on an employee&#146;s promissory note
    becomes due and payable 60&#160;days after such employee ceases
    to work for the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The amounts receivable from these notes, $0.3&#160;million,
    $0.3&#160;million, and $0.2&#160;million at December&#160;31,
    2007, 2008, and June&#160;30, 2009, respectively, have been
    deducted from stockholders&#146; equity.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-16
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">10.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Stockholders&#146;
    Equity</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Preferred
    Stock</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: Arial, Helvetica">Dividend
    Rights</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The holders of Series&#160;A and Series&#160;D preferred stock
    are not entitled to receive any dividends unless declared by the
    Company&#146;s Board of Directors (the &#147;Board&#148;). In
    the event the Board declares a dividend on any shares of common
    stock, the holders of Series&#160;A and Series&#160;D preferred
    stock are entitled to receive a dividend on the same terms and
    at the same rate.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: Arial, Helvetica">Liquidation
    Preference</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Upon liquidation, the Series&#160;A and Series&#160;D
    stockholders rank equally with each other and senior to common
    stockholders and to all other classes or series of stock issued
    by the Company, except such classes or series of stock that rank
    pari passu with or senior to the Series&#160;A and Series&#160;D
    stock and such ranking is approved by a majority of the
    Series&#160;A and a majority of the Series&#160;D preferred
    stockholders. Upon liquidation, each holder of Series&#160;A and
    Series&#160;D preferred stock is entitled to receive an amount
    per share equal to the original purchase price plus any accrued
    but unpaid dividends (the &#147;Termination Amount&#148;). All
    assets remaining available for distribution will be distributed
    ratably to the holders of common stock, Series&#160;A preferred
    stock and Series&#160;D preferred stock. In the event the assets
    available for distribution to the holders of the Series&#160;A
    and Series&#160;D preferred stock are insufficient to pay in
    full the Termination Amount, the available assets will be
    distributed to such holders in proportion to the full amount
    each holder is entitled to receive.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In the event of a qualifying public offering, as defined in the
    Company&#146;s fourth Amended and Restated Certification of
    Incorporation, the Company must pay to each holder of
    Series&#160;A and Series&#160;D preferred stock an amount in
    cash equal to the Termination Amount, unless at the
    stockholder&#146;s option, the holder chooses to receive shares
    of common stock valued at the per common share price offered in
    the qualifying public offering. As discussed below, holders of
    Series&#160;A preferred stock and Series&#160;D preferred stock
    may also convert their shares into shares of common stock at the
    time of the offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Neither the Series&#160;A preferred stock nor the Series&#160;D
    preferred stock is redeemable.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: Arial, Helvetica">Voting
    Rights</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Holders of each Series&#160;A preferred stock and Series&#160;D
    preferred stock have the right to a number of votes equal to the
    number of shares of Series&#160;B common stock that are issuable
    upon conversion of such share of Series&#160;A preferred stock
    and Series&#160;D preferred stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: Arial, Helvetica">Conversion
    Rights</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Holders of Series&#160;A preferred stock have the right to
    convert the Series&#160;A preferred stock at any time into
    shares of Series&#160;B common stock at the rate of the original
    purchase price divided by the conversion price, subject to
    adjustment. Holders of the Series&#160;D preferred stock have
    the right to convert the Series&#160;D preferred stock at any
    time into shares of Series&#160;B common stock at the rate of
    the original purchase price divided by the conversion price,
    subject to adjustment.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2008 and June&#160;30, 2009, each
    outstanding share of Series&#160;A preferred stock was
    convertible into 306.5&#160;shares of Series&#160;B common stock
    and each share of Series&#160;D preferred stock was convertible
    into one share of Series&#160;B common stock.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-17
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Common
    Stock</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company is authorized to issue 25,500,000&#160;shares of
    common stock, of which 17,500,000 are designated as
    Series&#160;B common stock and 8,000,000 are designated as
    Series&#160;C common stock. The Company has reserved 14,436,863
    and 14,916,864&#160;shares at December&#160;31, 2008 and
    June&#160;30, 2009, respectively, for the issuance of common
    stock upon exercise of outstanding stock options and warrants,
    and conversion of shares of Series&#160;A preferred stock and
    Series&#160;D preferred stock
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Each share of Series&#160;B common stock is entitled to one
    vote. Shares of Series&#160;C common stock have no voting
    privileges. Holders of Series&#160;B common stock and
    Series&#160;C common stock are entitled to receive dividends
    when and if declared by the Board, subject to the prior rights
    of holders of all classes of stock outstanding. All of the
    Company&#146;s outstanding common stock at December&#160;31,
    2007 and 2008, and June&#160;30, 2009, is restricted with regard
    to transfer rights.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Restricted
    Stock Plan</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In March 2004, the Board authorized the Company&#146;s
    Restricted Stock Plan. The Restricted Stock Plan provides for
    the grant of restricted Series&#160;B or Series&#160;C common
    stock to employees, directors, and outside consultants. The
    Company&#146;s Board, or a committee designated by the Board
    administers the Restricted Stock Plan and has authority to
    determine the terms and conditions of awards, including the
    number of shares subject to each award, the vesting schedule of
    the awards, and the selection of grantees.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: Arial, Helvetica">Series&#160;B
    Common Stock</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In March 2004, the Company awarded 3,000,000 restricted shares
    of Series&#160;B common stock, having a fair market value on
    that date of $0.0256 per share to an employee under the
    Restricted Stock plan. The shares vested over four years,
    beginning in November 2003, subject to the employee&#146;s
    continued employment. Stock-based compensation expense of
    $0.02&#160;million and
    <FONT style="white-space: nowrap">$0.02&#160;million</FONT>
    was recorded for the years ended December&#160;31, 2006 and 2007.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In June 2007, the Company issued and sold 669,284 restricted
    shares of Series&#160;B common stock to a customer for an
    aggregate price of $5.5&#160;million under the Restricted Stock
    Plan.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: Arial, Helvetica">Series&#160;C
    Common Stock</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In June 2004, the Company issued 3,175,000 restricted shares of
    Series&#160;C common stock, having a fair market value on that
    date of $0.0256 per share to certain employees and directors
    under the Restricted Stock Plan. In January 2005, 90,000
    restricted shares of Series&#160;C common stock, having a fair
    market value on that date of $1.03 per share, were issued to a
    director under the Restricted Stock Plan. The shares have
    various vesting schedules ranging from immediate vesting to
    vesting over a period of 48&#160;months, subject to continued
    employment or service on the Board. Stock compensation expense
    of $0.03&#160;million, $0.02&#160;million was recorded in 2006
    and 2007 related to these awards.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: Arial, Helvetica">Exchange of
    Series&#160;B and Series&#160;Class&#160;C Restricted Common
    Stock</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Effective December 2008, the Company and certain employees and
    directors entered into an agreement pursuant to which such
    employees and directors exchanged a total of
    3,309,951&#160;shares of Series&#160;C common stock for a like
    number of Series&#160;B common stock.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-18
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Dividends</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company paid a cash dividend in the aggregate amount of
    $15.0&#160;million or $0.7203 per common equivalent share to
    holders of record as of July&#160;11, 2008 of the Company&#146;s
    common stock and preferred stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In August 2009, the Company declared an additional cash dividend
    in the aggregate amount of $15.0&#160;million, or $0.72 per
    common equivalent share to holders of record as of
    September&#160;1, 2009 of the Company&#146;s common stock and
    preferred stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Warrants</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Effective in October 2004, the Company entered into a
    Supplemental Warrant Agreement with Ascension Health, its
    founding customer, which provided for the right to purchase up
    to 902,374&#160;shares of Series&#160;B common stock based upon
    the achievement of specified milestones relating to the
    customer&#146;s sales and marketing assistance. The purchase
    price of the shares is equal to the most recent per share price
    of the Company&#146;s Series&#160;B common stock in a capital
    raising transaction or, if there has not been a capital raising
    transaction within the preceding six months, the exercise price
    of the Company&#146;s most recently granted employee stock
    options.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In May 2007, the Company and Ascension Health, its founding
    customer, agreed to amend and restate the Supplemental Warrant
    Agreement to reduce the number of shares covered by the warrant
    to 446,190.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Supplemental Warrant Agreement, and all individual warrants
    issued thereunder, expire on the earlier of November&#160;7,
    2014, or the effective date of an initial public offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    During December 2007, the founding customer earned the right to
    purchase 223,095&#160;shares of Series&#160;B common stock under
    the Amended Supplemental Warrant Agreement. The warrants have an
    exercise price of $17.36 per share. The Company recorded
    $4.2&#160;million as marketing expenses in the 2007 financial
    statements in conjunction with the issuance of this warrant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    During March 2008, the founding customer earned the right to
    purchase 111,548&#160;shares of Series&#160;B common stock under
    the Amended Supplemental Warrant Agreement. The warrants have an
    exercise price of $40.17 per share. The Company recorded
    $2.4&#160;million as marketing expenses in the 2008 financial
    statements in conjunction with the issuance of this warrant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    During March 2009, the founding customer earned the right to
    purchase 111,547&#160;shares of Series&#160;B common stock under
    the Amended Supplemental Warrant Agreement. The warrants have an
    exercise price of $51.05 per share. The Company recorded
    $2.8&#160;million as marketing expenses for the six months ended
    June&#160;30, 2009 in conjunction with the issuance of this
    warrant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Effective November 2004, the Company entered into a Protection
    Warrant Agreement with the founding customer whereby the Company
    granted the customer anti-dilution rights by entering into an
    agreement whereby the founding customer is granted warrants to
    purchase the Company&#146;s Series&#160;B common stock from time
    to time at an exercise price of $0.01 per share when the
    customer&#146;s ownership percentage declines as a result of the
    Company offering more common share equivalents. The Protection
    Warrant Agreement, and all individual warrants issued
    thereunder, expire on the earlier of November&#160;7, 2014, or
    the effective date of an initial public offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In the years ended December&#160;31, 2006, 2007, and 2008, and
    the six months ended June&#160;30, 2008 and 2009, warrants to
    purchase 15,752, 58,175, 23,261, 19,358 and 25,837&#160;shares
    of Series&#160;B common stock, respectively, were earned under
    the Protection Warrant. As a result of this award,
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-19
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    revenue recorded was reduced by $0.1&#160;million,
    $0.9&#160;million, $0.9&#160;million, $0.7&#160;million, and
    $1.3&#160;million in 2006, 2007 and 2008, and for the six months
    ended June&#160;30, 2008 and 2009, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    During the year ended December&#160;31, 2007 and the six months
    ended June&#160;30, 2008 and 2009, the founding customer
    purchased 213,100, 66,652 and 16,758&#160;shares of the
    Company&#146;s Series&#160;B common stock, respectively, for
    $0.01 per share, pursuant to the Protection Warrant Agreement.
    As of June&#160;30, 2009, the founding customer has the right to
    purchase an additional 23,863&#160;shares for $0.01 per share
    under the agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In conjunction with the start of its business, in February 2004,
    the Company executed a term sheet with a consulting firm and its
    principal contemplating that the Company would grant the
    consulting firm a warrant, with an exercise price equal to the
    fair market value of the Company&#146;s common stock upon grant,
    to purchase shares of the Company&#146;s common stock then
    representing 2.5% of the Company&#146;s equity in exchange for
    exclusive rights to certain revenue cycle methodologies, tools,
    technology, benchmarking information and other intellectual
    property, plus up to another 2.5% of the Company&#146;s equity
    at the time of grant if the consulting firm&#146;s introduction
    of us to senior executives at prospective customers resulted in
    the execution of managed service contracts between us and such
    customers. In January 2005, we formalized the warrant grant
    contemplated by the term sheet and granted the consulting firm a
    warrant to purchase 833,334&#160;shares of the Company&#146;s
    Series&#160;C common stock for $1.12 per share, representing
    5.0% of the Company&#146;s equity at that time. In 2005, the
    Company recorded $483,334 in selling, general and administrative
    expense in conjunction with this warrant grant. The warrant
    expires on the earlier of January&#160;15, 2015 or a change of
    control of the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company uses the modified Black-Scholes option pricing model
    to determine the estimated fair value of all of the above
    warrants at the date granted. The significant assumptions used
    in the model were:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="27%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="14%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="17%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="10%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="21%">&nbsp;</TD>	<!-- colindex=05 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="5" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2006</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">June&#160;30, 2009</FONT></B>
</DIV>
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future dividends
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Risk-free interest rate
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    3.9% to 5.2%
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    2.75% to 4.21%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    3.45%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    2.91%
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Expected volatility
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    60%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    50%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    50%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    50%
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Expected life
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    7.8&#160;years
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    6.8&#160;years
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    6.6&#160;years
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    5.6&#160;years
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: Arial, Helvetica">Stock
    Options</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In December 2003, the Board approved a stock option plan, which
    provides for the grant of stock options to employees, directors
    and consultants. The plan was amended and restated in February
    2006. As of June&#160;30, 2009, the plan permitted the issuance
    of a maximum of 3,544,862&#160;shares of common stock and
    173,828&#160;shares were available for grant. Under the terms of
    the plan, all options will expire if they are not exercised
    within ten years after the grant date. Substantially all of the
    options granted vest over four years at a rate of 25% per year
    on each grant date anniversary. Options can be exercised
    immediately upon grant, but upon exercise the shares issued are
    subject to the same vesting and repurchase provisions that
    applied before exercise.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to January&#160;1, 2006, the Company accounted for
    share-based compensation using the intrinsic value method
    prescribed in Accounting Principles Board Opinion No.&#160;25,
    <I>Accounting for Stock Issued to Employees</I>, and related
    interpretations, as permitted by Statement of Financial
    Accounting Standards No.&#160;123, <I>Accounting for Stock-Based
    Compensation</I>. Accordingly, compensation expense
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-20
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    for stock options was measured as the excess, if any, of the
    fair market value of the Company&#146;s common stock at the
    measurement date (the date of grant for stock options) over the
    exercise price. Since the Company only granted employee stock
    options with an exercise price equal to fair market value on the
    date of grant, the Company did not record any compensation
    expense for stock option grants prior to January&#160;1, 2006.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Effective January&#160;1, 2006, the Company adopted the fair
    value recognition provisions of SFAS&#160;123(R) using the
    modified prospective transition method. Under this method:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="5%"></TD>
    <TD width="2%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    compensation expense for share-based awards granted prior to
    January&#160;1, 2006 is recognized over the remaining service
    period based on the grant date fair value estimated in
    accordance with the original provisions of
    SFAS&#160;123;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    compensation expense for all share-based awards granted
    subsequent to December&#160;31, 2005 is recognized over the
    service period based on the grant date fair value estimated in
    accordance with the provisions of SFAS&#160;123(R).
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company uses the modified Black-Scholes option pricing model
    to determine the estimated fair value of each option as of its
    grant date. These inputs are subjective and generally require
    significant analysis and judgment to develop. The following
    table sets forth the significant assumptions used in the model
    during 2006, 2007 and 2008 and the six months ended
    June&#160;30, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="27%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="15%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="13%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="15%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="19%">&nbsp;</TD>	<!-- colindex=05 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="5" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2006</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">June&#160;30, 2009</FONT></B>
</DIV>
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future dividends
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Forfeitures
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    1.88% annually
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    7.5% annually
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    3.75% annually
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    3.75% annually
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Risk-free interest rate
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    3.9% to 5.2%
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    2.3% to 5.5%
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    2.8 to 4.0%
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    1.6% to 2.4%
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Expected volatility
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    60%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    50%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    50%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    50%
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Expected life
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    6.25&#160;years
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    6.25&#160;years
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    6.25&#160;years
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    6.25&#160;years
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Since the Company&#146;s stock is not actively traded, the
    Company&#146;s management estimated its expected volatility by
    reviewing the historical volatility of the common stock of
    public companies that operate in similar industries or are
    similar in terms of stage of development or size and then
    projecting this information toward its future expected results.
    Judgment was used in selecting these companies, as well as in
    evaluating the available historical and implied volatility for
    these companies.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    All employees were aggregated into one pool for valuation
    purposes. The risk-free rate is based on the U.S.&#160;treasury
    yield curve in effect at the time of grant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The plan has not been in existence a sufficient period for the
    Company&#146;s historical experience to be used when estimating
    expected life. Furthermore, data from other companies is not
    readily available. Therefore, the expected life of each stock
    option was calculated using a simplified method based on the
    average of each option&#146;s vesting term and original
    contractual term. This methodology is set forth in Staff
    Accounting Bulletin&#160;No.&#160;107 and its use is permitted
    by Staff Accounting Bulletin&#160;No.&#160;110.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The estimated forfeiture rate is derived from the Company&#146;s
    historical data and its estimates of the likely future actions
    of option holders.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-21
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth a summary of option activity
    under the Plan for the years ended December&#160;31, 2006, 2007,
    and 2008 and the six months ended June&#160;30, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="46%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="13%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Weighted-<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Weighted-<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Remaining<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Contractual<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Aggregate<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Shares</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Price</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Term</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 9pt">Intrinsic Value</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 9pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Outstanding at January&#160;1, 2006
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,694,879
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.85
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Granted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    779,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.96
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Exercised&#160;&#151; vested
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (264,184
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.41
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Exercised&#160;&#151; non-vested
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (819,017
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.40
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Forfeited
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (188,250
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.08
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Outstanding at December&#160;31, 2006
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,202,428
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.55
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,270
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Granted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    768,030
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.36
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Exercised&#160;&#151; vested
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (16,021
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.42
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Exercised&#160;&#151; non-vested
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (37,148
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.08
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Forfeited
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (176,229
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.44
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Outstanding at December&#160;31, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,741,060
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.69
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,397
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Granted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    443,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    41.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Exercised&#160;&#151; vested
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3,750
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.74
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Exercised&#160;&#151; non-vested
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (8,550
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15.51
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Forfeited
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (90,250
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8.69
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Outstanding at December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,081,510
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    14.77
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    30,734
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Outstanding and vested at December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    856,428
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5.08
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,348,120
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" style="border-top: 1px solid #000000">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Granted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    439,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    51.70
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Exercised&#160;&#151; vested
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (20,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.38
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Exercised&#160;&#151; non-vested
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,250
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.15
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Forfeited
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (58,875
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10.51
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Outstanding at June&#160;30, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,440,885
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21.59
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    52,688
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Outstanding and vested at June&#160;30, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,054,930
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8.52
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    8,987
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Amounts received by the Company from the exercise of unvested
    stock options are classified as accrued expenses until vesting
    occurs. The share amounts in the chart above include vested and
    unvested exercises.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The weighted-average grant date fair value of options granted in
    the years ended December&#160;31, 2006, 2007 and 2008, and the
    six months ended June&#160;30, 2008 and 2009, was $4.96, $13.36,
    $41.25, $36.46 and $51.70 per share, respectively. The total
    intrinsic value of the options exercised in the years ended
    December&#160;31, 2006, 2007 and 2008, and the six months ended
    June&#160;30, 2008 and 2009 was $2.4&#160;million,
    $0.5&#160;million, $0.2&#160;million, $0.2&#160;million, and
    $0.2&#160;million, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Total share-based compensation cost recognized for the years
    ended December&#160;31, 2006, 2007 and 2008, and the six months
    ended June&#160;30, 2008 and 2009 was $0.8&#160;million,
    $0.9&#160;million, $3.6&#160;million, $1.0&#160;million, and
    $3.0&#160;million, respectively, with related income tax
    benefits of
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-22
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <FONT style="white-space: nowrap">approximately</FONT>
    $0.3&#160;million, $0.4&#160;million, $1.4&#160;million,
    $0.4&#160;million, and $1.0&#160;million, respectively. As of
    December&#160;31, 2008 and June&#160;30, 2009 there was $10.9
    and $18.1&#160;million of total unrecognized share-based
    compensation cost related to stock options granted under the
    Plan, respectively, which the Company expects to recognize over
    a weighted-average period of 3.1&#160;years.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 05 -->

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">11.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">401
    (k)&#160;Retirement Plan</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company maintains a 401(k) retirement plan that is intended
    to be a tax-qualified defined contribution plan under
    Section&#160;401(k) of the Internal Revenue Code. In general,
    all employees are eligible to participate. The 401(k) plan
    includes a salary deferral arrangement pursuant to which
    participants may elect to reduce their current compensation by
    up to the statutorily prescribed limit, equal to $16,500 in
    2009, and have the amount of the reduction contributed to the
    401(k) plan. The Company currently matches employee
    contributions up to 50% of the first 3% of base compensation
    that a participant contributes to the plan. In 2006, 2007 and
    2008, and for the six months ended June&#160;30, 2008 and 2009,
    employees who were Directors, Vice President, or higher levels
    were excluded from the matching contribution feature of the
    plan. For the years ended December&#160;31, 2006, 2007 and 2008,
    and for the six months ended June&#160;30, 2008 and 2009, total
    Company contributions to the plan were $.01&#160;million,
    $0.1&#160;million, $0.2&#160;million, $0.1&#160;million, and
    $0.1&#160;million, respectively.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 05 -->

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">12.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Operating
    Leases</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company rents office space and equipment under a series of
    operating leases, primarily for its Chicago corporate office and
    India operations. Lease payments are amortized to expense on a
    straight-line basis over the lease term. As of December&#160;31,
    2008, the Chicago corporate office consisted of approximately
    28,000&#160;square feet in a multi-story office building. The
    Company has an option to cancel the lease effective
    November&#160;30, 2011 if the landlord is unable, prior to
    December&#160;31, 2010, to provide approximately
    22,000&#160;square feet of additional office space on an
    adjacent floor. If the landlord provides this additional office
    space and the Company does not concurrently exercise the option
    to return approximately 6,500&#160;square feet of office space
    on a non-adjacent floor, the lease for all 50,000&#160;feet will
    be extended until ten years and 90&#160;days after the date the
    Company takes possession of the additional 22,000&#160;square
    feet of office space, and the minimum lease payments will
    increase by approximately $0.6&#160;million per year.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company&#146;s financial institution has issued a
    $0.2&#160;million irrevocable letter of credit to the landlord
    on behalf of the Company. This letter of credit serves as a
    security deposit for payment of the Company&#146;s obligations
    under the lease. As of December&#160;31, 2008, the Company had
    set aside $0.2&#160;million to guarantee its obligation to repay
    the financial institution in the event that the financial
    institution is required to perform under the letter of credit.
    This amount is included in cash in the Company&#146;s
    consolidated balance sheet.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Total rent expense was $0.6&#160;million, $0.6&#160;million,
    $1.0&#160;million, $0.6&#160;million, and $0.8&#160;million in
    the years ended December&#160;31, 2006, 2007 and 2008, and the
    six months ended June&#160;30, 2008 and 2009, respectively.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-23
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    At December&#160;31, 2008, the aggregate minimum lease
    commitments under all noncancelable operating leases are as
    follows (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="91%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,218
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2010
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    824
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2011
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    758
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2012
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    329
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2013
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    258
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Thereafter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    534
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,921
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">13.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Income
    Taxes</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    For the years ended December&#160;31, 2007 and 2008, the
    Company&#146;s tax provision consists of the following (in
    thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="68%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Current</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Deferred</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Total</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Year ended December&#160;31, 2007:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    U.S. federal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    141
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    141
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    State and local
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    312
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    312
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Foreign
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    456
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    456
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Year ended December&#160;31, 2008:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    U.S. federal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    66
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    66
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    State and local
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,177
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,177
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Foreign
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,264
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,264
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    For the year ended December&#160;31, 2006, the Company incurred
    a net loss and recorded a full valuation allowance on the net
    deferred tax benefit. As a result, there was no tax provision
    for the year ended December&#160;31, 2006.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Income tax expense was $0.5&#160;million and $2.3&#160;million
    for the years ended December&#160;31, 2007 and 2008,
    respectively, and differed from the amounts computed by applying
    the U.S.&#160;federal income tax rate of 34% to pretax income as
    a result of the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="85%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Federal statutory tax rate
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Increase (reduction) in income tax rate resulting from:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Change in the valuation allowance
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (11
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (15
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    India tax holiday
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Meals and entertainment and other permanent differences
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Alternative minimum tax
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    State and local income taxes, net of federal benefits
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Anti-dilution warrants issued to customers
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Change in tax rate
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (18
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Other, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Actual tax rate
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    65
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-24
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth the Company&#146;s net deferred
    tax assets (liabilities) as of December&#160;31, 2007 and 2008
    (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="79%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2007</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">2008</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Deferred tax assets:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Alternative minimum tax credit
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    carryover
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    <B>$</B>
</TD>
<TD nowrap align="right" valign="bottom">
    241
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Net operating loss carryforwards
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,491
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,538
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Employee stock compensation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    234
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,407
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Stock warrants
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,553
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,855
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Charitable contributions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    105
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Other
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    28
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    57
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total gross deferred tax assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,340
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,203
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Less valuation allowance
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4,733
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3,629
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net deferred tax assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    607
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,574
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Deferred tax liabilities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Deferred revenue
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,471
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Fixed assets and intangibles
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (607
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,103
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total deferred tax liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (607
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3,574
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net deferred tax liability
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2008, the Company had provided a
    valuation allowance for the full amount of its net deferred tax
    assets because its cumulative net tax loss during the three-year
    period ended December&#160;31, 2008 resulted in management
    concluding that it was not more likely than not that the net
    deferred tax asset will be realized.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Income taxes for the six months ended June&#160;30, 2008 and
    June&#160;30, 2009 amounted to an expense of $0.6&#160;million
    and a tax benefit of $2.4&#160;million, respectively. During the
    six months ended June&#160;30, 2009 the Company reduced the
    valuation allowance recorded against the Company&#146;s deferred
    tax assets due to a change in the estimate of the future
    utilization by the management. The reduction resulted in a tax
    benefit of $3.5&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    At December&#160;31, 2008, the Company has cumulative federal
    net operating loss carryforwards of approximately
    $7.1&#160;million, which expire beginning in 2025. As of
    December&#160;31, 2008, the Company had net operating loss
    carryforwards for state income tax purposes of
    $0.1&#160;million, which are available to offset future taxable
    income in certain states. In addition, as of December&#160;31,
    2008, the Company had alternative minimum tax credit
    carryforwards of $0.2&#160;million, which are available to
    reduce future federal regular tax, if any, over an indefinite
    period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company has not recognized a deferred tax liability for the
    undistributed earnings of its foreign subsidiary that arose in
    2007 and 2008 because the Company considers these earnings to be
    indefinitely reinvested outside of the United States. As of
    December&#160;31, 2007 and 2008, and the six months ended
    June&#160;30, 2009, the undistributed earnings of this
    subsidiary were $0.1&#160;million, $0.5&#160;million, and
    $0.6&#160;million, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Under the provisions of the Internal Revenue Code, certain
    substantial changes in the Company&#146;s ownership may result
    in a limitation on the amount of net operating loss
    carryforwards that can be used in future years.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-25
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company&#146;s uncertain tax positions as of
    December&#160;31, 2008, totaled $0.2&#160;million. The following
    table summarizes the activity related to the unrecognized tax
    benefits during 2008 (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="93%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Unrecognized tax benefits as of December&#160;31, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    319
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Increases in positions taken in a current period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    84
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Unrecognized tax benefits as of December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    403
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2008, approximately $0.3&#160;million of
    the total gross unrecognized tax benefits represented the amount
    that, if recognized, would result in a reduction of the
    effective income tax rate in future periods.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    During the six months ended June&#160;30, 2009, the Company
    recognized an increase in its liability for uncertain tax
    positions of $0.1&#160;million. The Company does not anticipate
    the total amount of unrecognized tax positions will
    significantly increase or decrease in the subsequent twelve
    months. The Company and its subsidiaries are subject to
    U.S.&#160;federal income tax as well as income tax of multiple
    state and foreign jurisdictions. U.S.&#160;federal income tax
    returns for 2006 through 2008 are currently open for
    examination. State jurisdictions vary for open tax years. The
    statute of limitations for most states ranges from 3 to
    6&#160;years.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Company recognizes interest and penalties related to income
    tax matters as income tax expense. The Company recorded
    adjustments to interest and potential penalties related to these
    unrecognized tax benefits during 2008, and in total, as of
    December&#160;31, 2008, the Company has recorded a liability for
    interest and potential penalties of $0.02&#160;million.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 05 -->

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">14.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Legal
    Proceedings</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    From time to time, the Company has been and may again become
    involved in legal proceedings or regulatory investigations
    arising in the ordinary course of business. The Company is not
    presently a party to any material litigation and the
    Company&#146;s management is not aware of any pending or
    threatened litigation that could have a material adverse effect
    on the Company&#146;s business, operating results, financial
    condition or cash flows.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 05 -->

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">15.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Earnings (Loss)
    Per Common Share</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Earnings per share (&#147;EPS&#148;) is calculated in accordance
    with Statement of Financial Accounting Standards
    (&#147;SFAS&#148;) No.&#160;128, <I>Earnings Per Share
    </I>(&#147;SFAS&#160;128&#148;), and EITF Issue
    <FONT style="white-space: nowrap">No.&#160;03-06,</FONT>
    <I>Participating Securities and the Two-Class&#160;Method Under
    SFAS&#160;No.&#160;128</I>, and FASB Staff Position (FSP)
    <FONT style="white-space: nowrap">No.&#160;EITF&#160;03-06-01,</FONT>
    <I>Determining Whether Instruments Granted in Share-Based
    Payment Transactions Are Participating Securities </I>(&#147;FSP
    <FONT style="white-space: nowrap">EITF&#160;03-06-01&#148;).</FONT>
    FSP
    <FONT style="white-space: nowrap">EITF&#160;03-6-1&#160;states</FONT>
    that unvested share-based payment awards that contain
    nonforfeitable rights to dividends or dividend equivalents
    (whether paid or unpaid) are participating securities and shall
    be included in the computation of earnings per share pursuant to
    the two-class method.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Under the two-class method, earnings are allocated between
    common stock and participating securities. FSP
    <FONT style="white-space: nowrap">EITF&#160;03-6-1</FONT>
    provides guidance that the presentation of basic and diluted
    earnings per share is required only for each class of common
    stock and not for participating securities. The Company&#146;s
    Series&#160;B and Series&#160;C common stock have equal
    participation rights and therefore the Company has presented
    earnings per common share for Series&#160;B and Series&#160;C
    common stock as one class.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-26
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Accretive Health,
    Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Notes to
    Consolidated Financial Statements&#160;&#151;
    (Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The two-class method includes an earnings allocation formula
    that determines earnings per share for each class of common
    stock according to dividends declared and undistributed earnings
    for the period. The Company&#146;s reported net earnings is
    reduced by the amount allocated to participating securities to
    arrive at the earnings allocated to common stock shareholders
    for purposes of calculating earnings per share.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The dilutive effect of participating securities is calculated
    using the more dilutive of the treasury stock or the two-class
    method. The Company has determined the two-class method to be
    the more dilutive. As such, the earnings allocated to common
    stock shareholders in the basic earnings per share calculation
    is adjusted for the reallocation of undistributed earnings to
    participating securities as prescribed by
    <FONT style="white-space: nowrap">FSP&#160;03-6-1</FONT>
    to arrive at the earnings allocated to common stock shareholders
    for calculating the diluted earnings per share.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table sets forth the computation of basic and
    diluted earnings per share under the two-class method (in
    thousands of dollars, except for share and per share amounts):
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="44%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Years Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2006</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2007</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2009</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>(unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net income (loss) as reported
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,319
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    774
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,243
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (594
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,214
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Less: Distributed earnings available to participating securities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,148
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Less: Undistributed earnings (loss) available to participating
    securities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,450
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    451
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (411
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (20
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,862
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Numerator for basic earnings (loss) per share -
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Undistributed and distributed earnings available to common
    shareholders
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5,869
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    323
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,494
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (574
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,352
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Add: Undistributed earnings (loss) allocated to participating
    securities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,450
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (411
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (20
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Less: Undistributed earnings (loss) reallocated to participating
    securities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (552
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    20
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (168
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (8
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Numerator for diluted earnings per share -
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Undistributed and distributed earnings available to common
    shareholders
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (6,767
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    326
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (6,737
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (586
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,356
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Denominator for basic earnings (loss) per share -
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Weighted-average common shares
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,611,975
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,410,226
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,214,916
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,160,187
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,337,812
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Effect of dilutive securities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,885,785
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,154,834
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Denominator for diluted earnings (loss) per share -
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Weighted-average common shares adjusted for dilutive securities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,611,975
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,296,011
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,214,916
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,160,187
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,492,646
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Earnings (loss) per share:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Basic income (loss) per share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.89
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.04
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.70
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.06
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Diluted net income (loss) per share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (1.02
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.03
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.73
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.06
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Because of their anti-dilutive effect, 12,506,716, 13,790,631,
    and 13,281,008 of common share equivalents comprised of
    convertible preferred shares, unvested common stock, warrants
    and unvested stock options, have been excluded from the diluted
    earnings per share calculation for the years ended
    December&#160;31, 2006 and December&#160;31, 2008 and for the
    six months ended June&#160;30, 2008, respectively.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    F-27
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="font-size: 0pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 2pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <FONT style="font-size: 16pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Shares
    </FONT>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 18pt">Accretive Health,
    Inc.</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <FONT style="font-size: 16pt">Common Stock
    </FONT>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 19%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=456 length=89 -->

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <IMG src="c53658c5365813.gif" alt="(ACCRETIVE HEALTH LOGO)"><FONT style="font-size: 16pt">
    </FONT>
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 19%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=456 length=89 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="50%"></TD>
    <TD width="50%"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">    <B><FONT style="font-size: 16pt; font-family: Arial, Helvetica">Goldman,
    Sachs&#160;&#038; Co.</FONT></B></TD>
    <TD nowrap align="right">    <B><FONT style="font-size: 16pt; font-family: Arial, Helvetica">
    Credit Suisse</FONT></B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="50%"></TD>
    <TD width="50%"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">    <B><FONT style="font-size: 16pt; font-family: Arial, Helvetica">J.P.
    Morgan</FONT></B></TD>
    <TD nowrap align="right">    <B><FONT style="font-size: 16pt; font-family: Arial, Helvetica">
    Morgan Stanley</FONT></B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 19%; border-bottom: 1pt solid #000000"></CENTER><!-- callerid=999 iwidth=456 length=89 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 0pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 2pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<P align="left" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Part&#160;II<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Information Not
    Required in Prospectus</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Item&#160;13.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: Arial, Helvetica">Other Expenses
    of Issuance and Distribution</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The following table indicates the expenses to be incurred in
    connection with the offering described in this Registration
    Statement, other than underwriting discounts and commissions,
    all of which will be paid by the Registrant. All amounts are
    estimated except the Securities and Exchange Commission
    registration fee and the FINRA filing fee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="88%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Amount</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Securities and Exchange Commission registration fee
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    11,160
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Financial Industry Regulatory Authority fee
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    20,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    New York Stock Exchange listing fee
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    250,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accountants&#146; fees and expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Legal fees and expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Financial advisory fee(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Blue Sky fees and expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Transfer Agent&#146;s fees and expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Printing and engraving expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Miscellaneous
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total Expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="center" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    * </TD>
    <TD></TD>
    <TD valign="bottom">
    To be filed by amendment.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of a cash fee of $&#160;&#160;&#160;&#160;&#160;
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock valued at
    $&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    based on an assumed initial public offering price of
    $&#160;&#160;&#160;&#160;&#160; per share, the midpoint of the
    estimated price range shown on the cover of this prospectus.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Item&#160;14.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: Arial, Helvetica">Indemnification
    of Directors and Officers</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Section&#160;102 of the General Corporation Law of the State of
    Delaware permits a corporation to eliminate the personal
    liability of directors of a corporation to the corporation or
    its stockholders for monetary damages for a breach of fiduciary
    duty as a director, except where the director breached his duty
    of loyalty, failed to act in good faith, engaged in intentional
    misconduct or knowingly violated a law, authorized the payment
    of a dividend or approved a stock repurchase in violation of
    Delaware corporate law or obtained an improper personal benefit.
    Our restated certificate of incorporation that will become
    effective upon the closing of this offering provides that no
    director of the Registrant shall be personally liable to it or
    its stockholders for monetary damages for any breach of
    fiduciary duty as director, notwithstanding any provision of law
    imposing such liability, except to the extent that the General
    Corporation Law of the State of Delaware prohibits the
    elimination or limitation of liability of directors for breaches
    of fiduciary duty.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Section&#160;145 of the General Corporation Law of the State of
    Delaware provides that a corporation has the power to indemnify
    a director, officer, employee, or agent of the corporation and
    certain other persons serving at the request of the corporation
    in related capacities against expenses (including
    attorneys&#146; fees), judgments, fines and amounts paid in
    settlements actually and reasonably incurred by the person in
    connection with an action, suit or proceeding to which he is or
    is threatened to be made a party by reason of such position, if
    such person acted in good faith and in a manner he reasonably
    believed to be in or not opposed to the best interests of the
    corporation and, in any criminal action or proceeding, had no
    reasonable cause to believe his conduct was unlawful, except
    that, in the case of actions brought by or in the right of the
    corporation, no indemnification shall be made with respect to
    any claim, issue or matter as to which such person shall have
    been adjudged to be liable to the corporation unless and only to
    the extent that the Court of Chancery or other
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    II-1
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    adjudicating court determines that, despite the adjudication of
    liability but in view of all of the circumstances of the case,
    such person is fairly and reasonably entitled to indemnity for
    such expenses which the Court of Chancery or such other court
    shall deem proper.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Our restated certificate of incorporation provides that we will
    indemnify each person who was or is a party or threatened to be
    made a party to any threatened, pending or completed action,
    suit or proceeding (other than an action by or in the right of
    Accretive Health) by reason of the fact that he or she is or
    was, or has agreed to become, a director or officer of Accretive
    Health, or is or was serving, or has agreed to serve, at our
    request as a director, officer, partner, employee or trustee of,
    or in a similar capacity with, another corporation, partnership,
    joint venture, trust or other enterprise (all such persons being
    referred to as an &#147;Indemnitee&#148;), or by reason of any
    action alleged to have been taken or omitted in such capacity,
    against all expenses (including attorneys&#146; fees),
    judgments, fines and amounts paid in settlement actually and
    reasonably incurred in connection with such action, suit or
    proceeding and any appeal therefrom, if such Indemnitee acted in
    good faith and in a manner he or she reasonably believed to be
    in, or not opposed to, our best interests, and, with respect to
    any criminal action or proceeding, he or she had no reasonable
    cause to believe his or her conduct was unlawful. Our restated
    certificate of incorporation provides that we will indemnify any
    Indemnitee who was or is a party to an action or suit by or in
    the right of Accretive Health to procure a judgment in our favor
    by reason of the fact that the Indemnitee is or was, or has
    agreed to become, a director or officer of Accretive Health, or
    is or was serving, or has agreed to serve, at our request as a
    director, officer, partner, employee or trustee or, or in a
    similar capacity with, another corporation, partnership, joint
    venture, trust or other enterprise, or by reason of any action
    alleged to have been taken or omitted in such capacity, against
    all expenses (including attorneys&#146; fees) and, to the extent
    permitted by law, amounts paid in settlement actually and
    reasonably incurred in connection with such action, suit or
    proceeding, and any appeal therefrom, if the Indemnitee acted in
    good faith and in a manner he or she reasonably believed to be
    in, or not opposed to, the best interests of Accretive Health,
    except that no indemnification shall be made with respect to any
    claim, issue or matter as to which such person shall have been
    adjudged to be liable to us, unless a court determines that,
    despite such adjudication but in view of all of the
    circumstances, he or she is entitled to indemnification of such
    expenses. Notwithstanding the foregoing, to the extent that any
    Indemnitee has been successful, on the merits or otherwise, he
    or she will be indemnified by us against all expenses (including
    attorneys&#146; fees) actually and reasonably incurred in
    connection therewith. Expenses must be advanced to an Indemnitee
    under certain circumstances.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Prior to the closing of this offering, we intend to enter into
    indemnification agreements with each of our directors and our
    executive officers. These indemnification agreements may require
    us, among other things, to indemnify our directors and executive
    officers for some expenses, including attorneys&#146; fees,
    judgments, fines and settlement amounts incurred by a director
    or executive officer in any action or proceeding arising out of
    his service as one of our directors or executive officers, or
    any of our subsidiaries or any other company or enterprise to
    which the person provides services at our request.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We maintain a general liability insurance policy that covers
    certain liabilities of directors and officers of our corporation
    arising out of claims based on acts or omissions in their
    capacities as directors or officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In any underwriting agreement we enter into in connection with
    the sale of common stock being registered hereby, the
    underwriters will agree to indemnify, under certain conditions,
    us, our directors, our officers and persons who control us with
    the meaning of the Securities Act of 1933, as amended, against
    certain liabilities.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Item&#160;15.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: Arial, Helvetica">Recent Sales
    of Unregistered Securities</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Set forth below is information regarding our issuances of
    capital stock and our grants of warrants and options to purchase
    shares of capital stock within the past three years. Also
    included is the consideration, if any, received by us for such
    shares, warrants and options and information relating to
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    II-2
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    the section of the Securities Act, or rule of the Securities and
    Exchange Commission, under which exemption from registration was
    claimed.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (a)&#160;<I>Issuances of Capital Stock</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 5%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (1)&#160;In May 2006, we issued an aggregate of
    99,757&#160;shares of non-voting common stock, valued at $5.26
    per share (based on the estimated fair value of the shares on
    that date) for an aggregate value of $524,722, to a total of 15
    former stockholders of SureDecisions, Inc. in connection with
    our acquisition of SureDecisions in May 2006. In June 2007, we
    issued an aggregate of 39,899 additional shares of non-voting
    common stock, valued at $8.20 per share (based on the estimated
    fair value of the shares on that date) for an aggregate value of
    $327,172, as earn-out consideration to the former stockholders
    of SureDecisions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 5%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (2)&#160;In May 2007, we issued 669,284&#160;shares of voting
    common stock to Ascension Health at a price of $8.20 per share
    for a total purchase price of $5,488,128.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 5%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (3)&#160;In December 2008, we issued an aggregate of
    3,309,952&#160;shares of voting common stock in exchange for
    3,309,952&#160;shares of non-voting common stock held by a total
    of 10 of our directors, officers and their affiliates. These
    shares are subject to the terms and conditions set forth in our
    restricted stock plan, the restricted stock award agreements
    entered into between us and our stockholders in connection with
    the original issuance of the shares of non-voting common stock
    and our stockholders&#146; agreement pursuant to which these
    persons have certain registration rights.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    No underwriters were involved in the foregoing issuances of
    securities. The shares of common stock described in paragraphs
    (a)(1), (a)(2) and (a)(3) of Item&#160;15 were issued in
    reliance upon the exemption from the registration requirements
    of the Securities Act provided by Section&#160;3(a)(9) or 4(2)
    of the Securities Act as sales by an issuer not involving any
    public offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (b)&#160;<I>Warrant Grants and Exercises</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Between January&#160;1, 2006 and September&#160;21, 2009, we
    granted warrants to Ascension Health to purchase an aggregate of
    569,215&#160;shares of voting common stock with exercise prices
    ranging from $0.01 per share to $51.05 per share. Between
    January&#160;1, 2006 and September&#160;21, 2009, Ascension
    Health purchased an aggregate of 321,690&#160;shares of voting
    common stock upon warrant exercises for aggregate consideration
    of $3,217.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The warrants and shares of voting common stock issuable upon the
    exercise of the warrants described in this paragraph (b)&#160;of
    Item&#160;15 were issued in reliance upon the exemption from the
    registration requirements of the Securities Act provided by
    Section&#160;4(2) of the Securities Act as sales by an issuer
    not involving any public offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (c)&#160;<I>Option Grants and Exercises</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Between January&#160;1, 2006 and September&#160;21, 2009, we
    granted options to purchase an aggregate of
    2,460,030&#160;shares of non-voting common stock, with exercise
    prices ranging from $3.15 to $58.65 per share, to employees,
    directors and consultants pursuant to our stock option plan.
    Between January&#160;1, 2006 and September&#160;21, 2009, we
    issued an aggregate of 37,948&#160;shares of non-voting common
    stock upon exercise of unvested options for aggregate
    consideration of $232,481 and 1,131,972&#160;shares of
    non-voting common stock upon exercise of vested options for
    aggregate consideration of $2,932,248.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The options and shares of non-voting common stock issuable upon
    the exercise of the options described in this paragraph
    (c)&#160;of Item&#160;15 were issued pursuant to written
    compensatory plans or arrangements with our employees, directors
    and consultants in reliance upon the exemption from the
    registration requirements of the Securities Act provided by
    Rule&#160;701 promulgated under the Securities Act. All
    recipients of options and shares pursuant to this exemption
    either received adequate information about us or had access,
    through employment or other relationships, to such information.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    II-3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In some cases, the options and shares of non-voting common stock
    issuable upon the exercise of the options described in this
    paragraph (c)&#160;of Item&#160;15 were issued in reliance upon
    the exemption from the registration requirements of the
    Securities Act provided by Section&#160;4(2) of the Securities
    Act and Regulation&#160;D promulgated thereunder as sales by an
    issuer not involving any public offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    All of the foregoing securities are deemed restricted securities
    for purposes of the Securities Act. All certificates
    representing the issued shares of voting common stock and
    non-voting common stock described in paragraphs (a),
    (b)&#160;and (c)&#160;of Item&#160;15 included appropriate
    legends setting forth that the securities had not been
    registered and the applicable restrictions on transfer.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (d)&#160;<I>Issuance of Shares for Financial Advisory
    Services</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Contemporaneously with the closing of this offering and based on
    an assumed initial public offering price of
    $&#160;&#160;&#160;&#160;&#160; per share, the midpoint of the
    estimated price range shown on the cover of this prospectus, the
    Registrant will
    issue&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock to Financial Technology Partners, LLC
    <FONT style="white-space: nowrap">and/or</FONT> FTP
    Securities, LLC in partial payment of a fee due for financial
    advisory services provided in connection with this offering. The
    balance of such fee will be paid in cash, as listed in
    Item&#160;13 above. The financial advisory services of Financial
    Technology Partners, LLC and FTP Securities, LLC included
    assistance in financial and valuation modeling and advice with
    respect to the initial public offering process and equity
    capital market alternatives, and neither Financial Technology
    Partners, LLC nor FTP Securities, LLC acted as an underwriter of
    this offering. The issuance of shares to Financial Technology
    Partners, LLC
    <FONT style="white-space: nowrap">and/or</FONT> FTP
    Securities, LLC to will be exempt from registration under
    Section&#160;4(2) of the Securities Act. When issued, these
    securities will be deemed restricted securities for purposes of
    the Securities Act, and all certificates representing these
    securities will include appropriate legends setting forth that
    the securities had not been registered and the applicable
    restrictions on transfer.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Item&#160;16.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: Arial, Helvetica">Exhibits and
    Financial Statement Schedules</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <I>(a)&#160;Exhibits</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The exhibits to the registration statement are listed in the
    Exhibit&#160;Index to this registration statement and are
    incorporated by reference herein.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <I>(b)&#160;Financial Statement Schedules</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">Report of
    Independent Registered Public Accounting Firm</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The Board of Directors and Shareholders
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Accretive Health, Inc.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    We have audited the consolidated financial statements of
    Accretive Health, Inc. (formerly Healthcare Services d/b/a
    Accretive Health) as of December&#160;31, 2008 and 2007, and for
    each of the three years in the period ended December&#160;31,
    2008, and have issued our report thereon dated May&#160;20, 2009
    (included elsewhere in this Registration Statement). Our audits
    also included the financial statement schedule listed in
    Item&#160;16(b) of
    <FONT style="white-space: nowrap">Form&#160;S-1</FONT>
    of this Registration Statement. This schedule is the
    responsibility of the Company&#146;s management. Our
    responsibility is to express an opinion based on our audits.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    In our opinion, the financial statement schedule referred to
    above, when considered in relation to the basic financial
    statements taken as a whole, presents fairly in all material
    respects the information set forth therein.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    /s/ Ernst&#160;&#038; Young LLP
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Chicago, Illinois
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    May&#160;20, 2009
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    II-4
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">SCHEDULE&#160;II&#160;&#151;
    VALUATION AND QUALIFYING ACCOUNTS<BR>
    Accretive Health, Inc.<BR>
    December&#160;31, 2008<BR>
    (In thousands)</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="36%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="13%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Col. A</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Col. B</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Col. C</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Col. D</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Col. E</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Balance at<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Charged to<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Beginning of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Costs and<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Charged to Other<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Balance at<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Description</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Period</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Expenses</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Accounts</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Deductions</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>End of Period</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Allowance for Doubtful Accounts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Year Ended December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    432
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    350
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Year Ended December&#160;31, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    72
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    360
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    432
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Year Ended December&#160;31, 2006
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    72
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    72
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Deferred Tax Valuation Allowance
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Year Ended December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,733
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,104
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,629
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Year Ended December&#160;31, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,867
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    134
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,733
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Year Ended December&#160;31, 2006
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,405
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,462
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,867
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: Arial, Helvetica">Item&#160;17.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: Arial, Helvetica">Undertakings</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The undersigned registrant hereby undertakes to provide to the
    underwriters at the closing specified in the underwriting
    agreement, certificates in such denominations and registered in
    such names as required by the underwriters to permit prompt
    delivery to each purchaser.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Insofar as indemnification for liabilities arising under the
    Securities Act of 1933&#160;may be permitted to directors,
    officers and controlling persons of the registrant pursuant to
    the foregoing provisions, or otherwise, the registrant has been
    advised that, in the opinion of the Securities and Exchange
    Commission, such indemnification is against public policy as
    expressed in the Securities Act and is, therefore,
    unenforceable. In the event that a claim for indemnification
    against such liabilities (other than the payment by the
    registrant of expenses incurred or paid by a director, officer
    or controlling person of the registrant in the successful
    defense of any action, suit or proceeding) is asserted by such
    director, officer or controlling person in connection with the
    securities being registered, the registrant will, unless in the
    opinion of its counsel the matter has been settled by
    controlling precedent, submit to a court of appropriate
    jurisdiction the question whether such indemnification by it is
    against public policy as expressed in the Securities Act and
    will be governed by the final adjudication of such issue.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    The undersigned registrant hereby undertakes that:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 5%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (1)&#160;For purposes of determining any liability under the
    Securities Act, the information omitted from the form of
    prospectus filed as part of this registration statement in
    reliance upon Rule&#160;430A and contained in the form of
    prospectus filed by the registrant pursuant to
    Rule&#160;424(b)(1) or (4)&#160;or 497(h) under the Securities
    Act shall be deemed to be part of the registration statement as
    of the time it was declared effective.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 5%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (2)&#160;For purposes of determining any liability under the
    Securities Act, each post-effective amendment that contains a
    form of prospectus shall be deemed to be a new registration
    statement relating to the securities offered therein, and the
    offering of such securities at that time shall be deemed to be
    the initial bona fide offering thereof.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    II-5
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 5%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (3)&#160;For the purpose of determining liability under the
    Securities Act to any purchaser, each prospectus filed pursuant
    to Rule&#160;424(b) as part of a registration statement relating
    to an offering, other than registration statements relying on
    Rule&#160;430B or other than prospectuses filed in reliance on
    Rule&#160;430A, shall be deemed to be part of and included in
    the registration statement as of the date it is first used after
    effectiveness. Provided, however, that no statement made in a
    registration statement or prospectus that is part of the
    registration statement or made in a document incorporated or
    deemed incorporated by reference into the registration statement
    or prospectus that is part of the registration statement will,
    as to a purchaser with a time of contract of sale prior to such
    first use, supersede or modify any statement that was made in
    the registration statement or prospectus that was part of the
    registration statement or made in any such document immediately
    prior to such date of first use.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 5%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (4)&#160;For the purpose of determining liability of the
    registrant under the Securities Act to any purchaser in the
    initial distribution of the securities, in a primary offering of
    securities of the undersigned registrant pursuant to this
    registration statement, regardless of the underwriting method
    used to sell the securities to the purchaser, if the securities
    are offered or sold to such purchaser by means of any of the
    following communications, the undersigned registrant will be a
    seller to the purchaser and will be considered to offer or sell
    such securities to such purchaser:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 10%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (i)&#160;Any preliminary prospectus or prospectus of the
    undersigned registrant relating to the offering required to be
    filed pursuant to Rule 424;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 10%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (ii)&#160;Any free writing prospectus relating to the offering
    prepared by or on behalf of the undersigned registrant or used
    or referred to by the undersigned registrant;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 10%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (iii)&#160;The portion of any other free writing prospectus
    relating to the offering containing material information about
    the undersigned registrant or its securities provided by or on
    behalf of the undersigned registrant; and
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 10%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    (iv)&#160;Any other communication that is an offer in the
    offering made by the undersigned registrant to the purchaser.
</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    II-6
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">SIGNATURES</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Pursuant to the requirements of the Securities Act, the
    Registrant has duly caused this Registration Statement to be
    signed on its behalf by the undersigned, thereunto duly
    authorized, in the City of Chicago, State of Illinois, on the
    29th day of September, 2009.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    ACCRETIVE HEALTH, INC.
</DIV>

<DIV style="margin-top: 48pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="49%"></TD>
    <TD width="4%"></TD>
    <TD width="47%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    By:&#160;
</TD>
    <TD align="left">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;Mary
    A. Tolan</DIV>
</TD>
</TR>

</TABLE>

<DIV style="font-size: 2pt; margin-left: 53%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Mary A. Tolan
</DIV>

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <I>Founder, President and Chief Executive Officer</I>
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">POWER OF
    ATTORNEY</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
    appears below constitutes and appoints Mary A. Tolan, John T.
    Staton, Gregory N. Kazarian and David A. Westenberg, and each of
    them,
    <FONT style="white-space: nowrap">his/her</FONT> true
    and lawful attorneys-in-fact and agents, with full power of
    substitution and resubstitution for him/her and in
    <FONT style="white-space: nowrap">his/her</FONT>
    name, place and stead, in any and all capacities, to sign any
    and all amendments (including post-effective amendments) to this
    Registration Statement, and any subsequent registration
    statements pursuant to Rule&#160;462 of the Securities Act and
    to file the same, with all exhibits thereto, and other documents
    in connection therewith, with the Securities and Exchange
    Commission, granting unto said attorneys-in-fact and agents, and
    each of them, full power and authority to do and perform each
    and every act and thing requisite and necessary to be done in
    and about the premises, as fully to all intents and purposes as
    <FONT style="white-space: nowrap">he/she</FONT> might
    or could do in person, hereby ratifying and confirming all that
    each of said attorney-in-fact or
    <FONT style="white-space: nowrap">his/her</FONT>
    substitute or substitutes, may lawfully do or cause to be done
    by virtue hereof.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    Pursuant to the requirements of the Securities Act, this
    Registration Statement has been signed by the following persons
    in the capacities and on the dates indicated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="4%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="35%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="35%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="19%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Signature</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Title</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Date</FONT></B>
</DIV>
</TD>
</TR>
<TR style="line-height: 12pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;Mary
    A. Tolan</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=201 iwidth=175 length=0 -->Mary
    A. Tolan
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Director, Founder, President and Chief Executive Officer
    (Principal Executive Officer)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    September&#160;29, 2009
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;John
    T. Staton</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=201 iwidth=175 length=0 -->John
    T. Staton
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Chief Financial Officer and Treasurer (Principal Financial
    Officer)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    September&#160;29, 2009
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;James
    M. Bolotin </DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=201 iwidth=175 length=0 -->James
    M. Bolotin
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Corporate Controller (Principal Accounting Officer)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    September&#160;29, 2009
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;J.
    Michael Cline </DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=201 iwidth=175 length=0 -->J.
    Michael Cline
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Founder and Chairman of the Board
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    September&#160;29, 2009
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;Edgar
    M. Bronfman, Jr. </DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=201 iwidth=175 length=0 -->Edgar
    M. Bronfman, Jr.
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    September&#160;29, 2009
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;Steven
    N. Kaplan </DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=201 iwidth=175 length=0 -->Steven
    N. Kaplan
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    September&#160;29, 2009
</TD>
</TR>
</TABLE>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    II-7
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="4%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="35%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="35%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="19%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Signature</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Title</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B><FONT style="font-size: 10pt">Date</FONT></B>
</DIV>
</TD>
</TR>
<TR style="line-height: 12pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;Denis
    J. Nayden </DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=201 iwidth=175 length=0 -->Denis
    J. Nayden
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    September&#160;29, 2009
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;George
    P. Shultz</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=201 iwidth=175 length=0 -->George
    P. Shultz
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    September&#160;29, 2009
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;Arthur
    H. Spiegel,&#160;III </DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=201 iwidth=175 length=0 -->Arthur
    H. Spiegel,&#160;III
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    September&#160;25, 2009
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;Mark
    A. Wolfson </DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=201 iwidth=175 length=0 -->Mark
    A. Wolfson
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    September&#160;29, 2009
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV>

<P align="center" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
    <BR>
    II-8
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: Arial, Helvetica">EXHIBIT&#160;INDEX</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=01 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=01 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=01 type=align1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="90%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
    <B><FONT style="font-size: 10pt">Exhibit<BR>
    </FONT></B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Number</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Description</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    1
</TD>
<TD nowrap align="left" valign="top">
    .1*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Underwriting Agreement
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Fourth Amended and Restated Certificate of Incorporation of the
    Registrant, as amended
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .2*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Restated Certificate of Incorporation of the Registrant,
    to be effective upon the closing of the offering
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Bylaws of the Registrant
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .4*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Amended and Restated Bylaws of the Registrant, to be
    effective upon the closing of the offering
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    4
</TD>
<TD nowrap align="left" valign="top">
    .1*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Specimen Certificate evidencing shares of common stock
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    5
</TD>
<TD nowrap align="left" valign="top">
    .1*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Opinion of Wilmer Cutler Pickering Hale and Dorr LLP
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amended and Restated Stock Option Plan
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Acknowledgement of Grant, used to evidence option grants
    under the Amended and Restated Stock Option Plan
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .3*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Restricted Stock Plan, as amended
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .4
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Restricted Stock Award Agreement under the Restricted
    Stock Plan, as amended
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .5
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Third Amended and Restated Stockholders&#146; Agreement, dated
    as of February 22, 2009, among the Registrant and the parties
    named therein, as amended
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .6
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Share Exchange Agreement, entered into in February 2009,
    with each of Etienne H. Deffarges, Steven N. Kaplan, Gregory N.
    Kazarian, The Shultz 1989 Family Trust, Spiegel Family LLC and
    John T. Staton Declaration of Trust
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .7
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Lease Agreement, dated as of May 4, 2005, between the Registrant
    and Zeller Management Corporation, as amended by First Lease
    Amendment, dated as of January&#160;30, 2007, and Second Lease
    Amendment, dated as of November 26, 2008
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .8+
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amended and Restated Master Services Agreement, dated as of
    December 13, 2007, between the Registrant and Ascension Health
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .9
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Restricted Stock Agreement, dated as of November 7, 2004,
    between the Registrant and Ascension Health
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .10
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Protection Warrant Agreement between the Registrant and
    Ascension Health
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .11
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Supplemental Warrant Agreement between the Registrant and
    Ascension Health
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .12
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amended and Restated Supplemental Warrant Agreement, effective
    as of May 31, 2007, between the Registrant and Ascension Health
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .13
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Second Amended and Restated Supplemental Warrant Agreement,
    effective as of September 30, 2007, between the Registrant and
    Ascension Health
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .14
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Subscription Agreement, dated as of May 15, 2007, between the
    Registrant and Ascension Health
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .15
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Term Sheet, dated February 17, 2004, between the Registrant and
    Michael Zimmerman
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .16
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Warrant and License Agreement, dated as of January 2005, among
    the Registrant, Michael Zimmerman and Zimmerman and Associates
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .17*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Letter Agreement, dated January 9, 2009, among the Registrant,
    Financial Technology Partners, LLC and FTP Securities, LLC
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .18
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Employment Agreement, dated as of January 2004, between the
    Registrant and Mary A. Tolan, as amended
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .19
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Employment Agreement, dated as of June 17, 2005, between the
    Registrant and John&#160;T. Staton, as amended
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .20
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Offer Letter, dated December 9, 2003, between the Registrant and
    Gregory N. Kazarian, as amended
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .21*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Indemnification Agreement, to be entered into between
    the Registrant and each director and executive officer
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    21
</TD>
<TD nowrap align="left" valign="top">
    .1*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Subsidiaries of the Registrant
</TD>
</TR>
</TABLE>

<P align="left" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=01 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=01 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=01 type=align1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="90%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
    <B><FONT style="font-size: 10pt">Exhibit<BR>
    </FONT></B>
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    23
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    .1
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    Consent of Ernst &#038; Young LLP
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    23
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    .2*
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    Consent of Wilmer Cutler Pickering Hale and Dorr LLP (included
    in Exhibit 5.1)
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    24
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    .1
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    Powers of Attorney (included on signature page)
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    To be filed by amendment.</TD>
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[{"type": "S-1", "sequence": "1", "filename": "c53658sv1.htm", "description": "FORM S-1", "secsgml_size_bytes": 1980831}]
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FORM S-1
Table of Contents
As filed with the Securities and
    Exchange Commission on September 29, 2009
Registration
    No. 333-
UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
Washington, D.C.
    20549
Form S-1
REGISTRATION
    STATEMENT
UNDER
THE SECURITIES ACT OF
    1933
ACCRETIVE HEALTH,
    INC.
(Exact Name of Registrant as
    Specified in Its Charter)
Delaware
(State or Other Jurisdiction
    of
Incorporation or Organization)
7389
(Primary Standard
    Industrial
Classification Code No.)
02-0698101
(I.R.S. Employer
Identification No.)
401 North Michigan
    Avenue
Suite 2700
Chicago, Illinois
    60611
(312) 324-7820
(Address, including zip code,
    and telephone number, including area code, of registrant's
    principal executive offices)
Mary A. Tolan
Founder, President and Chief
    Executive Officer
401 North Michigan
    Avenue
Suite 2700
Chicago, Illinois
    60611
(312) 324-7820
(Name, address, including zip
    code, and telephone number, including area code, of agent for
    service)
Copies to:
David A. Westenberg, Esq.
Wilmer Cutler Pickering Hale and Dorr LLP
60 State Street
Boston, Massachusetts 02109
(617) 526-6000
Gregory A. Fernicola, Esq.
Jennifer A. Bensch, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036
(212) 735-3000
Approximate date of commencement of proposed sale to the
    public:
As soon as practicable after this
    Registration Statement is declared effective.
If any of the securities being registered on this form are
    offered on a delayed or continuous basis pursuant to
    Rule 415 under the Securities Act of 1933, as amended (the
    "Securities Act") please check the following
    box.
o
If this Form is filed to register additional securities for an
    offering pursuant to Rule 462(b) under the Securities Act,
    please check the following box and list the Securities Act
    registration statement number of the earlier effective
    registration statement for the same
    offering.
o
If this Form is a post-effective amendment filed pursuant to
    Rule 462(c) under the Securities Act, please check the
    following box and list the Securities Act registration statement
    number of the earlier effective registration statement for the
    same
    offering.
o
If this Form is a post-effective amendment filed pursuant to
    Rule 462(d) under the Securities Act, please check the
    following box and list the Securities Act registration statement
    number of the earlier effective registration statement for the
    same
    offering.
o
Indicate by check mark whether the registrant is a large
    accelerated filer, an accelerated filer, a non-accelerated
    filer, or a smaller reporting company. See the definitions of
    "large accelerated filer", "accelerated
    filer" and "smaller reporting company" in
    Rule 12b2 of the Exchange Act.
Large
    accelerated
    filer
o
Accelerated
    filer
o
Non-accelerated
    filer
þ
Smaller reporting
    company
o
(Do not check if a smaller
    reporting company)
CALCULATION OF REGISTRATION
    FEE
Proposed Maximum
Each Class of
Aggregate Offering
Amount of
Securities to be Registered
Price(1)
Registration Fee(2)
Common Stock, par value $0.01 per share
$200,000,000
$11,160
(1)
Estimated solely for the purpose of
    computing the registration fee in accordance with
    Rule 457(o) under the Securities Act of 1933, as amended.
(2)
Calculated pursuant to
    Rule 457(o) based on an estimate of the proposed maximum
    aggregate offering price.
The Registrant hereby amends this Registration Statement on
    such date or dates as may be necessary to delay its effective
    date until Registrant shall file a further amendment which
    specifically states that this Registration Statement shall
    thereafter become effective in accordance with Section 8(a)
    of the Securities Act or until the Registration Statement shall
    become effective on such date as the Commission, acting pursuant
    to Section 8(a), may determine.
Table of Contents
The
information in this prospectus is not complete and may be
changed. We may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is
effective. This prospectus is not an offer to sell these
securities and it is not soliciting offers to buy these
securities in any state where the offer or sale is not
permitted.
Subject to Completion, dated
    September 29, 2009
Shares
Common Stock
This is an initial public offering of shares of common stock of
    Accretive Health, Inc.
Accretive Health is
    offering          
    of the shares to be sold in the offering. The selling
    stockholders identified in this prospectus are
    offering           shares.
    Accretive Health will not receive any of the proceeds from the
    sale of the shares being sold by the selling stockholders.
Prior to this offering, there has been no public market for our
    common stock. It is currently estimated that the initial public
    offering price per share will be between
    $      and
    $     . We intend to apply to have our
    common stock listed on the New York Stock Exchange under the
    symbol "AH".
See "Risk Factors" beginning on page 12 to
    read about factors you should consider before buying shares of
    our common stock.
Neither the Securities and Exchange Commission nor any other
    regulatory body has approved or disapproved of these securities
    or passed upon the accuracy or adequacy of this prospectus. Any
    representation to the contrary is a criminal offense.
Per Share
Total
Initial public offering price
$
$
Underwriting discount
$
$
Proceeds, before expenses, to Accretive Health
$
$
Proceeds, before expenses, to the selling stockholders
$
$
To the extent that the underwriters sell more
    than           shares
    of common stock, the underwriters have the option to purchase up
    to an
    additional           shares
    from Accretive Health and the selling stockholders at the
    initial public offering price less the underwriting discount.
The underwriters expect to deliver the shares against payment in
    New York, New York
    on          ,
    2009.
Goldman,
    Sachs & Co.
Credit Suisse
J.P. Morgan
Morgan Stanley
Prospectus
    dated          ,
    2009.
TABLE OF
    CONTENTS
Prospectus
Page
Prospectus Summary
1
Summary Consolidated Financial Data
8
Risk Factors
12
Special Note Regarding Forward-Looking
    Statements
28
Industry and Market Data
28
Use of Proceeds
29
Dividend Policy
30
Capitalization
31
Dilution
33
Selected Consolidated Financial Data
35
Management's Discussion and Analysis of
    Financial Condition and Results of Operations
39
Business
64
Management
88
Related Person Transactions
106
Principal and Selling Stockholders
113
Description of Capital Stock
116
Shares Eligible for Future Sale
121
Certain U.S. Federal Tax Consequences to
Non-U.S.
Holders
124
Underwriting
127
Legal Matters
131
Experts
131
Where You Can Find More Information
131
Index to Consolidated Financial Statements
F-1
EX-3.1
EX-3.3
EX-10.1
EX-10.2
EX-10.4
EX-10.5
EX-10.6
EX-10.7
EX-10.8
EX-10.9
EX-10.10
EX-10.11
EX-10.12
EX-10.13
EX-10.14
EX-10.15
EX-10.16
EX-10.18
EX-10.19
EX-10.20
EX-23.1
Through and
    including          ,
    2009 (the 25th day after the date of this prospectus), all
    dealers effecting transactions in these securities, whether or
    not participating in this offering, may be required to deliver a
    prospectus. This is in addition to a dealer's obligation to
    deliver a prospectus when acting as an underwriter and with
    respect to an unsold allotment or subscription.
No dealer, salesperson or other person is authorized to give any
    information or to represent anything not contained in this
    prospectus. You must not rely on any unauthorized information or
    representations. This prospectus is an offer to sell only the
    shares offered hereby, but only under circumstances and in
    jurisdictions where it is lawful to do so. The information
    contained in this prospectus is current only as of its date.
Table of Contents
PROSPECTUS
    SUMMARY
This summary highlights information contained elsewhere in
    this prospectus. You should read the following summary together
    with the more detailed information appearing in this prospectus,
    including our consolidated financial statements and related
    notes, and the risk factors beginning on page 12, before
    deciding whether to purchase shares of our common stock. Unless
    the context otherwise requires, we use the terms "Accretive
    Health", "our company", we", "us"
    and "our" in this prospectus to refer to Accretive
    Health, Inc. and its subsidiaries.
Accretive
    Health
Overview
Accretive Health is a leading provider of healthcare revenue
    cycle management services. Our business purpose is to help
    U.S. hospitals, physicians and other healthcare providers
    manage their revenue cycle operations more efficiently. Our
    integrated, end-to-end technology and services offering, which
    we refer to as our solution, helps our customers realize
    sustainable improvements in their operating margins and improve
    the satisfaction of their patients, physicians and staff. We
    enable these improvements by helping our customers increase the
    portion of the maximum potential patient revenue they receive
    while reducing total revenue cycle costs.
Our customers typically are multi-hospital systems, including
    faith-based or community healthcare systems, academic medical
    centers and independent ambulatory clinics, and their affiliated
    physician practice groups. We seek to develop strategic,
    long-term relationships with our customers and focus on
    providers that we believe understand the value of our operating
    model and have demonstrated success in both clinical and
    operational outcomes. As of June 30, 2009, we provided our
    integrated revenue cycle service offerings to 21 customers
    representing 53 hospitals and $11.9 billion in annual net
    patient revenue, as well as physicians' billing
    organizations associated with several of these customers.
Grounded in sophisticated analytics, our solution spans our
    customers' entire revenue cycle, unlike competing services
    that address only a portion of the revenue cycle. We are not a
    traditional outsourcing company focused solely on one-time cost
    reductions. Through the implementation of our distinctive
    operating model that includes people, processes and technology,
    our customers can generate significant and sustainable revenue
    cycle improvements. Our service offerings are adaptable to
    evolution of the healthcare regulatory environment, technology
    standards and market trends, and require no up-front cash
    investment by our customers.
To implement our solution, we assume full responsibility for the
    management and cost of a customer's revenue cycle
    operations and supplement the customer's existing revenue
    cycle staff with seasoned Accretive Health personnel. We
    collaborate with our customers' revenue cycle employees
    with the objective of educating and empowering them so that over
    time they can deliver improved results using our tools. We and
    our customers share financial gains resulting from our solution,
    which directly aligns our objectives and interests with those of
    our customers. We believe that, over time, this alignment of
    interests fosters greater innovation and incentivizes us to
    improve our customers' revenue cycle operations.
The revenue cycle operations of a typical hospital, physician or
    other healthcare provider often fail to capture and collect the
    total amounts owed to it from third-party payors and patients
    for medical services rendered, leading to significant bad debt
    write-offs, uncompensated care, payor denials and corresponding
    administrative write-offs, as well as lost revenue for missed
    charges. Fitch Ratings estimates that in 2008 uncompensated care
    (including bad debt write-offs, charity care and uninsured
    discounts) averaged 17% of net patient revenue at
    U.S. hospitals. We deliver operating margin improvements to
    our customers through a combination of improvements in
    collections, which we refer to as net revenue yield, charge
    capture and revenue cycle cost reductions. Our customers have
1
Table of Contents
historically achieved significant net revenue yield improvements
    within 18 to 24 months of implementing our solution, with
    customers operating under mature managed service contracts
    realizing 400 to 600 basis points in yield improvements,
    typically in the third or fourth contract year.
We seek to embed our technology, personnel, know-how and culture
    within each customer's revenue cycle activities with the
    expectation that we will serve as the customer's
on-site
operational manager beyond the managed service contract's
    initial term, which typically ranges from four to five years. To
    date, we have experienced a contract renewal rate of 100%
    (excluding exploratory new services offerings, a consensual
    termination following a change of control and a customer
    reorganization). Coupled with the long-term nature of our
    managed service contracts and the fixed nature of the base fees
    under each contract, our historical renewal experience provides
    a core source of recurring revenue.
Our net services revenue consists primarily of base fees and
    incentive fees. We receive base fees for managing our
    customers' revenue cycle operations, net of any cost
    savings we share with those customers. Incentive fees represent
    our portion of the increase in our customers' net patient
    revenue resulting from our services. We generate a portion of
    our operating margin as a result of the difference between the
    fixed base fees and the variable costs of the revenue cycles
    that we manage. Incentive fees are a smaller portion of overall
    revenue than base fees but generally contribute directly to
    operating margin, thus significantly impacting our
    profitability. We closely monitor each customer's revenue
    cycle performance through periodic operating reviews. A
    customer's net revenue improvements and cost savings
    generally increase over time as we deploy additional programs
    and as the programs we implement become more effective, which in
    turn provides visibility into our future revenue and
    profitability. In 2008, for example, approximately 80% of our
    net services revenue, and over 95% of our net income, was
    derived from customer contracts that were in place as of
    January 1, 2008. In 2008, we had net services revenue of
    $398.5 million, representing growth of 65.5% over 2007 and
    a compound annual growth rate of 53.0% since January 1,
    2005. In addition, we were profitable for the years ended
    December 31, 2007 and 2008 and the six months ended
    June 30, 2009, and our profitability increased in each of
    those periods.
Market
    Opportunity
We believe that current macroeconomic conditions will continue
    to impose financial pressure on healthcare providers and will
    increase the importance of managing their revenue cycles
    effectively and efficiently. The market opportunity for our
    services — which we define as the total amount of net
    patient revenue collected annually by U.S. hospitals and
    physicians' billing organizations — exceeds
    $750 billion. We expect this market opportunity will
    continue to grow. According to the Centers for Medicare and
    Medicaid Services of the U.S. Department of Health and
    Human Services, expenditures for hospitals and physician and
    clinical services are expected to increase between 2009 and 2018
    at annual rates of approximately 6.4% and 5.4%, respectively.
    Additionally, the continued operating pressures facing
    U.S. hospitals coupled with some of the underlying themes
    of current healthcare reform proposals make the efficient
    management of the revenue cycle and collection of the full
    amount of payments due for patient services among the most
    critical challenges facing healthcare providers today.
We believe that the inability of healthcare providers to capture
    and collect the total amounts owed to them for patient services
    are caused by the following trends:
•
Complexity of Revenue Cycle Management.
At
    most hospitals, there is a lack of standardization across
    operating practices, payor and patient payment methodologies,
    data management processes and billing systems.
•
Lack of Integrated Systems and
    Processes.
Although interrelated, the individual
    steps in the revenue cycle continuum are not operationally
    integrated across revenue cycle departments at many hospitals.
2
Table of Contents
•
Increasing Patient Financial Responsibility for Healthcare
    Services.
Hospitals are being forced to adapt to
    the need for direct-to-patient billing and collections
    capabilities as patients bear payment responsibility for an
    increasing portion of healthcare costs. Hospitals have
    traditionally focused on collecting payments from insurance
    companies and from state and federal payors, and typically are
    less familiar with the processes necessary to collect payments
    from patients at the point of service, including the use of
    alternative payment options.
•
Outdated Systems and Insufficient Resources to Upgrade
    Them.
Many hospitals suffer from operating
    inefficiencies caused by outdated technology, increasingly
    complex billing requirements, a general lack of standardization
    of process and information flow, costly in-house services that
    could be more economically outsourced, and an increasingly
    stringent regulatory environment.
The Accretive
    Health Solution
Our solution is intended to address the full spectrum of revenue
    cycle operational issues faced by healthcare providers. We
    deliver improved operating margins to our customers through
    improved revenue cycle operations. During the assessment phase
    of the customer relationship, we identify specific areas for
    improvement and begin implementation upon execution of a managed
    services contract. Improvements in charge capture and
    collections are typically attributable to reduced payor denials,
    identification of additional items that can be billed to payors
    based on the actual procedures performed, identification of
    insurance for a higher percentage of otherwise uninsured
    patients, and improved collections of patient balances after
    insurance. Revenue cycle cost reductions are typically achieved
    through operating efficiencies, including streamlining work
    flow, automating processes and centralizing vendor activities.
    Specific sources of margin improvement vary among customers.
    While improvements in net revenue yield generally represent the
    majority of a customer's operating margin improvement, we
    are able to deliver additional margin improvement through
    revenue cycle cost reductions. Because our managed service
    contracts align our interests with those of our customers, we
    are able, over time, to improve our margins along with those of
    our customers.
We believe that our proprietary technology, management
    experience and well-developed processes are enhanced by the
    knowledge and experience we gain working with a wide range of
    customers and improve with each payor reimbursement or patient
    pay transaction. Our proprietary technology applications include
    workflow automation and direct payor connection capabilities
    that enable revenue cycle staff to focus on problem accounts
    rather than on manual tasks, such as searching payor websites
    for insurance and benefits verification for all patients. We
    employ "exception based logic" technology that
    provides the same interface for all users and automates a host
    of tasks that otherwise can consume a significant amount of
    staff time. We use real-time feedback from our customers to
    improve the functionality and performance of our technology and
    processes and incorporate these improvements into our service
    offerings on a regular basis. We strive to apply operational
    excellence throughout the entire revenue cycle.
We adapt our solution to the hospital's organizational
    structure in order to minimize disruption to existing staff and
    to make our services transparent to both patients and
    physicians. The experience and knowledge of the senior
    management personnel we provide to our customers can improve the
    performance of their in-house revenue cycle staff. Our objective
    is to improve the operating performance of our customers, thus
    generating incentive fees for ourselves, by:
•
Improving Net Revenue Yield.
We help our
    customers improve their net revenue yield. Through the use of
    our proprietary technologies and methodologies, we precisely
    calculate each customer's improvement in net revenue yield.
•
Increasing Charge Capture.
We help our
    customers increase their charge capture by implementing
    optimization techniques and related processes.
3
Table of Contents
•
Making Revenue Cycle Operations More
    Efficient.
We help our customers make their
    revenue cycle operations more efficient by implementing advanced
    technologies, streamlining operations, avoiding unnecessary
    re-work and improving quality.
We employ a variety of techniques intended to achieve our
    objectives for our customer:
•
Gathering Complete Information.
We focus on
    gathering complete patient information and educating the patient
    as to his or her potential financial responsibilities before
    receiving care so the services can be recorded and billed to the
    appropriate parties. We believe that hospitals employing our
    services have increased the percentage of non-emergency
    in-patient admissions with complete information profiles to
    nearly 100%, enabling fewer billing delays, increased charge
    capture and reduced billing cycles.
•
Improving Claims Filing and Third-Party Payor
    Collections.
We implement sophisticated analytics
    designed to improve claims filing and collection of claims from
    third-party insurance payors. By employing proprietary
    algorithms and modeling to determine how hospital revenue cycle
    staff should allocate time and resources across a pool of
    outstanding claims, we can increase the likelihood that patient
    services will be reimbursed.
•
Identifying Alternative Payment Sources.
We
    use various methods to find payment sources for uninsured
    patients and reimbursement for services not covered by
    third-party insurance. After a typical implementation period, we
    have been able to help our customers find a third-party payment
    source for approximately 85% of all admitted patients who
    identified themselves as uninsured.
•
Employing Proprietary Technology and
    Algorithms.
Our service offerings employ a
    variety of proprietary data analytics and predictive modeling
    algorithms. Our systems are designed to streamline work
    processes through the use of proprietary algorithms that focus
    revenue cycle staff effort on those accounts deemed to have the
    greatest potential for improving net revenue yield or charge
    capture.
•
Using Analytical Capabilities and Operational
    Excellence.
We draw on the experience that we
    have gained from working with many of the best healthcare
    provider systems in the United States to train hospital staffs
    about new and innovative revenue cycle management practices.
Our
    Strategy
Our goal is to become the preferred provider-of-choice for
    revenue cycle management services in the U.S. healthcare
    industry. Since our inception, we have worked with some of the
    largest and most prestigious healthcare systems in the United
    States, such as Ascension Health, the Henry Ford Health System
    and the Dartmouth-Hitchcock Medical Center. Going forward, our
    goal is to continue to expand the scope of our services to
    hospitals within our existing customers' systems as well as
    to leverage our strong relationships with reference customers to
    continue to attract business from new customers. Key elements of
    our strategy include the following:
•
delivering tangible, long-term results for our customers by
    providing end-to-end services across the entire revenue cycle;
•
continuing to develop innovative approaches to increase the
    yield on patient-owed obligations for medical services received;
•
enhancing and developing proprietary algorithms to identify
    potential errors and to make process corrections in the
    collection of reimbursements from third-party payors;
•
expanding our shared services program;
•
hiring, training and retaining our personnel;
•
continuing to diversify our customer base; and
4
Table of Contents
•
developing enhanced service offerings that offer us long-term
    opportunities.
Risks Associated
    with Our Business
Our business is subject to a number of risks which you should be
    aware of before making an investment decision. Those risks are
    discussed more fully in "Risk Factors" beginning on
    page 12. For example:
•
we may not be able to maintain or increase our profitability,
    and our recent growth rates may not be indicative of our future
    growth rates;
•
hospitals affiliated with Ascension Health account for a
    majority of our net services revenue;
•
we face competition from the internal revenue cycle management
    staff of hospitals as well as from a variety of external
    participants in the revenue cycle market;
•
if we are unable to retain our existing customers, or if our
    customers fail to renew their managed service contracts with us
    upon expiration, our financial condition will suffer; and
•
existing and prospective government regulation of the healthcare
    industry creates risks and challenges for our business.
Corporate
    Information
We were incorporated in Delaware under the name Healthcare
    Services, Inc. in July 2003 and changed our name to Accretive
    Health, Inc. in August 2009. Our principal executive offices are
    located at 401 North Michigan Avenue, Suite 2700, Chicago,
    Illinois 60611, and our telephone number is
(312) 324-7820.
Our website address is www.accretivehealth.com. Information
    contained on our website is not incorporated by reference into
    this prospectus, and you should not consider information
    contained on our website to be part of this prospectus or in
    deciding whether to purchase shares of our common stock.
Accretive Health, the Accretive Health logo, AHtoAccess,
    AHtoCharge, AHtoContract, AHtoLink, AHtoPost, AHtoRemit,
    AHtoScribe, AHtoScribe Administrator, AHtoTrac, A2A, Charge
    Integrity Services, Medicaid Eligibility Hub, YBFU, Yield-Based
    Follow Up and other trademarks or service marks of Accretive
    Health appearing in this prospectus are the property of
    Accretive Health.
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The
    Offering
Common stock offered by Accretive Health
shares
Common stock offered by the selling stockholders
shares
Common stock to be outstanding after this offering
shares
Use of proceeds
We intend to use approximately
    $      million of our net proceeds
    of this offering to pay the preferred stock liquidation
    preferences that will be paid in cash to the holders of our
    outstanding preferred stock concurrently with the conversion of
    such shares into shares of our common stock upon the closing of
    this offering. We intend to use the remainder of our net
    proceeds of this offering for general corporate purposes, which
    may include financing our growth, developing new services and
    funding capital expenditures, acquisitions and investments. We
    will not receive any proceeds from the shares sold by the
    selling stockholders. See "Use of Proceeds" for more
    information.
Risk Factors
You should read the "Risk Factors" section and other
    information included in this prospectus for a discussion of
    factors to consider carefully before deciding to invest in
    shares of our common stock.
Proposed New York Stock Exchange symbol
"AH"
The number of shares of our common stock to be outstanding after
    this offering is based on shares of common stock outstanding as
    of June 30, 2009 after giving effect to the assumptions in
    the following paragraph, and excludes:
•
833,334 shares of common stock issuable upon the exercise
    of warrants outstanding and exercisable as of June 30, 2009
    at a weighted-average exercise price of $1.12 per share, which
    will remain outstanding after this offering if not exercised
    prior to this offering;
•
2,440,885 shares of common stock issuable upon the exercise
    of stock options outstanding and exercisable as of June 30,
    2009 at a weighted-average exercise price of $21.59 per share,
    of which 1,054,930 shares with a weighted-average exercise
    price of $8.52 per share would be vested if purchased upon
    exercise of these options as of June 30, 2009;
•
173,828 shares of common stock available for future
    issuance under our equity compensation plans as of June 30,
    2009; and
•
an
    additional           shares
    of our common stock that will be made available for future
    issuance under our equity compensation plans upon the closing of
    this offering.
Except as otherwise noted, all information in this prospectus:
•
assumes no exercise by the underwriters of their option to
    purchase up to an
    additional           shares
    from us and the selling stockholders;
•
assumes that the shares to be sold in this offering are sold at
    the initial public offering price of
    $      per share, the midpoint of the
    estimated price range shown on the cover of this prospectus;
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•
gives effect to
    a           
    -for-one split of our common stock to be effected prior to the
    closing of this offering;
•
gives effect to the automatic conversion of all outstanding
    shares of non-voting common stock into shares of voting common
    stock on a share-for-share basis upon the closing of this
    offering;
•
gives effect to the automatic conversion of all outstanding
    shares of convertible preferred stock
    into           shares
    of common stock upon the closing of this offering, assuming an
    initial public offering price of $     
    per share, the midpoint of the estimated price range shown on
    the cover of this prospectus;
•
gives effect to our assumed issuance
    of           shares
    of common stock upon exercise of warrants that will be cancelled
    if not exercised prior to this offering, assuming an initial
    public offering price of $      per
    share, the midpoint of the estimated price range shown on the
    cover of this prospectus;
•
gives effect to our issuance
    of           shares
    of common stock to Financial Technology Partners, LLC
and/or
FTP
    Securities, LLC, whom we collectively refer to as FT Partners,
    contemporaneously with the closing of this offering for
    financial advisory services in respect of this offering,
    assuming an initial public offering price of
    $      per share, the midpoint of the
    estimated price range shown on the cover of this prospectus; and
•
gives effect to the restatement of our certificate of
    incorporation and amendment and restatement of our bylaws prior
    to the closing of this offering.
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SUMMARY
    CONSOLIDATED FINANCIAL DATA
The following tables summarize our consolidated financial data
    for the periods presented. The summary statements of operations
    for the three years ended December 31, 2008 are derived
    from our audited financial statements for the three years ended
    December 31, 2008 included elsewhere in this prospectus.
    The summary statements of operations for the six months ended
    June 30, 2008 and 2009 and the summary balance sheet data
    as of June 30, 2009 are derived from our unaudited
    financial statements included elsewhere in this prospectus. Our
    unaudited financial statements have been prepared on the same
    basis as the audited financial statements and notes thereto and,
    in the opinion of our management, include all adjustments
    (consisting of normal recurring adjustments) necessary for a
    fair statement of the information for the unaudited interim
    periods. Our historical results for prior interim periods are
    not necessarily indicative of results to be expected for a full
    year or for any future period.
The pro forma balance sheet data as of June 30, 2009 give
    effect to (1) the automatic conversion of all outstanding
    shares of non-voting common stock into shares of common stock
    upon the closing of this offering, (2) the automatic
    conversion of all outstanding shares of convertible preferred
    stock into shares of common stock upon the closing of this
    offering and (3) the assumed issuance
    of           shares
    of common stock upon exercise of warrants that will be cancelled
    if not exercised prior to this offering. The pro forma as
    adjusted balance sheet data as of June 30, 2009 give effect
    to (1) the items described in the preceding sentence,
    (2) our issuance and sale
    of           shares
    of common stock in this offering at an assumed initial public
    offering price of $      per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus, after deducting the estimated underwriting discount
    and offering expenses payable by us and the application of the
    net proceeds therefrom as described in "Use of
    Proceeds", and (3) our issuance
    of          shares
    of common stock to FT Partners contemporaneously with the
    closing of this offering, based on an assumed initial public
    offering price of $      per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus.
You should read this data together with our consolidated
    financial statements and related notes included elsewhere in
    this prospectus and the information under "Selected
    Consolidated Financial Data" and "Management's
    Discussion and Analysis of Financial Condition and Results of
    Operations".
Six Months Ended
Fiscal Year Ended December 31,
June 30,
2006
2007
2008
2008
2009
(Unaudited)
(In thousands, except share and per share data)
Statement of Operations Data:
Net services revenue
$
160,741
$
240,725
$
398,469
$
187,261
$
238,149
Costs of services
141,767
197,676
335,211
160,082
195,667
Operating margin
18,974
43,049
63,258
27,179
42,482
Operating expenses:
Infused management and technology
18,875
27,872
39,234
17,938
24,482
Selling, general and administrative
8,777
15,657
21,227
9,642
15,308
Total operating expenses
27,652
43,529
60,461
27,580
39,790
Income (loss) from operations
(8,678
)
(480
)
2,797
(401
)
2,692
Interest income
1,359
1,710
710
433
83
Income (loss) before provision for (benefit from) income taxes
(7,319
)
1,230
3,507
32
2,775
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Six Months Ended
Fiscal Year Ended December 31,
June 30,
2006
2007
2008
2008
2009
(Unaudited)
(In thousands, except share and per share data)
Provision for (benefit from) income taxes
—
456
2,264
626
(2,439
)
Net income (loss)
$
(7,319
)
$
774
$
1,243
$
(594
)
$
5,214
Net income (loss) per common share:
Basic:
$
(0.89
)
$
0.04
$
(0.70
)
$
(0.06
)
$
0.25
Diluted:
(1.02
)
0.03
(0.73
)
(0.06
)
0.21
Weighted-average shares used in computing net income (loss) per
    common share:
Basic:
6,611,975
8,410,226
9,214,916
9,160,187
9,337,812
Diluted:
6,611,975
10,296,011
9,214,916
9,160,187
11,492,646
Other Operating Data (unaudited):
Adjusted EBITDA(1)
$
(7,125
)
$
6,842
$
12,220
$
4,620
$
11,658
Net patient revenue under management (at period end) (in
    billions)
$
4.1
$
6.9
$
9.1
$
8.5
$
11.9
As of June 30, 2009
Pro Forma
Actual
Pro Forma
As Adjusted
(Unaudited)
(In thousands)
Balance Sheet Data:
Cash and cash equivalents
$
37,789
Working capital
4,114
Total assets
105,965
Total stockholders' equity
$
20,537
(1)
We define adjusted EBITDA as net income (loss) before net
    interest income (expense), income tax expense (benefit),
    depreciation and amortization expense and share-based
    compensation expense. Adjusted EBITDA is a non-GAAP financial
    measure and should not be considered as an alternative to net
    income, operating income and any other measure of financial
    performance calculated and presented in accordance with GAAP.
We believe adjusted EBITDA is useful to investors in evaluating
    our operating performance for the following reasons:
•
adjusted EBITDA and similar non-GAAP measures are widely used by
    investors to measure a company's operating performance
    without regard to items that can vary substantially from company
    to company depending upon financing and accounting methods, book
    values of assets, capital structures and the methods by which
    assets were acquired;
•
securities analysts often use adjusted EBITDA and similar
    non-GAAP measures as supplemental measures to evaluate the
    overall operating performance of companies; and
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•
by comparing our adjusted EBITDA in different historical
    periods, our investors can evaluate our operating results
    without the additional variations of interest income (expense),
    income tax expense (benefit), depreciation and amortization
    expense and share-based compensation expense.
Our management uses adjusted EBITDA:
•
as a measure of operating performance, because it does not
    include the impact of items that we do not consider indicative
    of our core operating performance;
•
for planning purposes, including the preparation of our annual
    operating budget;
•
to allocate resources to enhance the financial performance of
    our business;
•
to evaluate the effectiveness of our business strategies; and
•
in communications with our board of directors and investors
    concerning our financial performance.
We understand that, although measures similar to adjusted EBITDA
    are frequently used by investors and securities analysts in
    their evaluation of companies, adjusted EBITDA has limitations
    as an analytical tool, and you should not consider it in
    isolation or as a substitute for analysis of our results of
    operations as reported under GAAP. Some of these limitations are:
•
adjusted EBITDA does not reflect our cash expenditures or future
    requirements for capital expenditures or other contractual
    commitments;
•
adjusted EBITDA does not reflect changes in, or cash
    requirements for, our working capital needs;
•
adjusted EBITDA does not reflect share-based compensation
    expense;
•
adjusted EBITDA does not reflect cash requirements for income
    taxes;
•
adjusted EBITDA does not reflect net interest income (expense);
•
although depreciation and amortization are non-cash charges, the
    assets being depreciated or amortized will often have to be
    replaced in the future, and adjusted EBITDA does not reflect any
    cash requirements for these replacements; and
•
other companies in our industry may calculate adjusted EBITDA
    differently than we do, limiting its usefulness as a comparative
    measure.
To properly and prudently evaluate our business, we encourage
    you to review the GAAP financial statements included elsewhere
    in this prospectus, and not to rely on any single financial
    measure to evaluate our business.
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The following table presents a reconciliation of adjusted EBITDA
    to net income (loss), the most comparable GAAP measure:
Six Months Ended
Fiscal Year Ended December 31,
June 30,
2006
2007
2008
2008
2009
(Unaudited)
(In thousands)
Net income (loss)
$
(7,319
)
$
774
$
1,243
$
(594
)
$
5,214
Net interest income(a)
(1,359
)
(1,710
)
(710
)
(433
)
(83
)
Provision (benefit) for income taxes
—
456
2,264
626
(2,439
)
Depreciation and amortization expense
626
1,307
2,540
920
1,882
EBITDA
$
(8,052
)
$
827
$
5,337
$
519
4,574
Stock compensation expense(b)
844
934
3,551
1,021
2,977
Stock warrant expense(b)
83
5,081
3,332
3,080
4,107
Adjusted EBITDA
$
(7,125
)
$
6,842
$
12,220
$
4,620
$
11,658
(a)  Net interest income represents earnings
    from our cash and cash equivalents. No debt or other
    interest-bearing obligations were outstanding during any of the
    periods presented.
(b)  Stock compensation expense and stock
    warrant expense collectively represent the
share-based
compensation expense reflected in our financial statements. Of
    the amounts presented above, $83, $928, $921, $696 and $1,334
    was classified as a reduction in net services revenue for the
    years ended December 31, 2006, 2007 and 2008 and the six
    months ended June 30, 2008 and 2009, respectively.
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RISK
    FACTORS
An investment in our common stock involves a high degree of
    risk. In deciding whether to invest, you should carefully
    consider the following risk factors. Any of the following risks
    could have a material adverse effect on our business, financial
    condition, results of operations or prospects and cause the
    value of our common stock to decline, which could cause you to
    lose all or part of your investment. When deciding whether to
    invest in our common stock, you should also refer to the other
    information in this prospectus, including our consolidated
    financial statements and related notes and the
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations" section of this
    prospectus.
Risks Related to
    Our Business and Industry
We may not be
    able to maintain or increase our profitability, and our recent
    growth rates may not be indicative of our future growth
    rates.
We have been profitable on an annual basis only since the year
    ended December 31, 2007, and we incurred net losses in the
    quarters ended March 31, 2007, December 31, 2007,
    March 31, 2008, December 31, 2008 and March 31,
    2009 and in the six months ended June 30, 2008. We may not
    succeed in maintaining our profitability on an annual basis and
    could incur quarterly or annual losses in future periods. We
    expect to incur additional operating expenses associated with
    being a public company and we intend to continue to increase our
    operating expenses as we grow our business. We also expect to
    continue to make investments in our proprietary technology
    applications, sales and marketing, infrastructure, facilities
    and other resources as we expand our operations, thus incurring
    additional costs. If our revenue does not increase to offset
    these increases in costs, our operating results would be
    negatively affected. You should not consider our historic
    revenue and net income growth rates as indicative of future
    growth rates. Accordingly, we cannot assure you that we will be
    able to maintain or increase our profitability in the future.
    Each of the risks described in this "Risk Factors"
    section, as well as other factors, may affect our future
    operating results and profitability. For example, factors that
    may affect our future operating results and profitability
    include:
•
the extent to which our service offerings achieve and maintain
    market acceptance;
•
the failure of our existing customers to renew their managed
    service contracts with us upon expiration;
•
the length of our sales, contracting and implementation cycles
    for new customers;
•
changes in customer procurement policies;
•
the financial condition of our current and potential customers;
•
the amount and timing of incentive payments we receive from our
    customers for increasing their revenue yield;
•
the amount and timing of reductions in our customers'
    revenue cycle costs that we are able to achieve;
•
changes in the average maturity of our managed service contracts
    with customers;
•
our ability to hire and retain qualified personnel to meet the
    needs of our growing business;
•
technical difficulties or interruptions in our services;
•
the entry of new competitors and the introduction of superior or
    more economical service offerings by new or existing competitors;
•
changes in the regulatory environment related to healthcare and
    reimbursement for healthcare services;
•
regulatory compliance costs;
•
litigation involving our company, including related to our
    intellectual property;
•
departures of key personnel;
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•
the timing, size and integration success of potential future
    acquisitions; and
•
changes in general economic, industry and market conditions.
Hospitals
    affiliated with Ascension Health currently account for a
    majority of our net services revenue, and we have several
    customers that have each accounted for 10% or more of our net
    services revenue in past fiscal periods. The termination of our
    master services agreement with Ascension Health, or any
    significant loss of business from our large customers, would
    have a material adverse effect on our business, results of
    operations and financial condition.
We are party to a master services agreement with Ascension
    Health pursuant to which we provide services to its affiliated
    hospitals that execute separate managed service contracts with
    us. Hospitals affiliated with Ascension Health have accounted
    for a majority of our net services revenue each year since our
    formation. In the years ended December 31, 2006, 2007 and
    2008 and the six months ended June 30, 2008 and 2009,
    aggregate revenue from hospitals affiliated with Ascension
    Health were $142.6 million, $214.2 million,
    $281.7 million, $136.7 million and
    $151.6 million, respectively, representing 88.7%, 89.0%,
    70.7%, 73.0% and 63.6% of our total net services revenue, which
    is the term we use for our net services revenue, in such
    periods. In some fiscal periods, individual hospitals affiliated
    with Ascension Health have each accounted for 10% or more of our
    total net services revenue. In addition, another customer, which
    is not affiliated with Ascension Health, accounted for 11.5% of
    our total net services revenue in the six months ended
    June 30, 2008 and 10.6% of our total net services revenue
    in the year ended December 31, 2008 but less than 10% of
    our total net services revenue in the six months ended
    June 30, 2009.
All of our managed service contracts with hospitals affiliated
    with Ascension Health will expire on December 13, 2012
    unless renewed. Pursuant to the master services agreement and
    the managed service contracts with hospitals affiliated with
    Ascension Health, our fees are subject to adjustment in the
    event quarterly cash collections at these hospitals deteriorate
    materially after we take over revenue cycle management
    operations. While these adjustments have never been triggered,
    if they were, our future fees from hospitals affiliated with
    Ascension Health would be reduced. In addition, any of our other
    customers, including hospitals affiliated with Ascension Health,
    can elect not to renew their managed service contracts with us
    upon expiration. We intend to seek renewal of all managed
    service contracts with our customers, but cannot assure you that
    all of them will be renewed or that the terms upon which they
    may be renewed will be as favorable to us as the terms of the
    initial managed service contracts.
Our inability to renew the managed service contracts with
    hospitals affiliated with Ascension Health, the termination of
    our master services agreement with Ascension Health, the loss of
    any of our other large customers or their failure to renew their
    managed service contracts with us upon expiration, or a
    reduction in the fees for our services for these customers would
    have a material adverse effect on our business, results of
    operations and financial condition.
Our master
    services agreement with Ascension Health requires us to offer to
    Ascension Health's affiliated hospitals service fees that
    are at least as low as the fees we charge any other similarly
    situated customer receiving comparable services at comparable
    volumes, and the master services agreement includes other
    provisions that could impede or delay our ability to enter into
    managed service contracts with new customers.
Our master services agreement with Ascension Health requires us
    to offer to Ascension Health's affiliated hospitals fees
    for our services that are at least as low as the fees we charge
    any other similarly-situated customer receiving comparable
    services at comparable volumes. If we were to offer another
    similarly-situated customer receiving a comparable volume of
    comparable services fees that are lower than the fees paid by
    hospitals affiliated with Ascension Health, we would be
    obligated to offer such lower fees to hospitals affiliated with
    Ascension Health, which could have a material
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adverse effect on our results of operations and financial
    condition. In addition, we are required to consult with
    Ascension Health's affiliated hospitals before undertaking
    services for competitors identified by them in the managed
    service contracts they execute with us. In limited
    circumstances, we have also agreed not to enter into managed
    service contracts with an existing customer's competitors
    without such customer's consent. These obligations could
    impede or delay our ability to enter into managed service
    contracts with new customers.
The market for
    integrated, end-to-end revenue cycle solutions may develop more
    slowly than we expect, which could adversely affect our revenue
    and our ability to maintain or increase our
    profitability.
Our success depends, in part, on the willingness of hospitals,
    physicians and other healthcare providers to implement
    integrated, end-to-end revenue cycle solutions. Some hospitals
    may be reluctant or unwilling to implement our solution for a
    number of reasons, including failure to perceive the need for
    improved revenue cycle operations and lack of knowledge about
    the potential benefits our solution provides. Even if potential
    customers recognize the need for improved revenue cycle
    operations, they may not select an integrated, end-to-end
    revenue cycle solution such as ours because they previously have
    made investments in internally developed solutions and choose to
    continue to rely on their own internal revenue cycle management
    staff. As a result, the market for integrated, end-to-end
    revenue cycle solutions may develop more slowly than we expect,
    which could adversely affect our revenue and our ability to
    maintain or increase our profitability.
We operate in
    a highly competitive industry, and our current or future
    competitors may be able to compete more effectively than we do,
    which could have a material adverse effect on our business,
    revenue, growth rates and market share.
The market for revenue cycle management solutions is highly
    competitive and we expect competition to intensify in the
    future. We face competition from the internal revenue cycle
    management staff of hospitals, as described above. We also
    compete with external participants in the revenue cycle market,
    including software-as-a-service or other technology-supported
    revenue cycle management business process outsourcing companies;
    traditional consultants; and information technology outsourcers.
    Our competitors may be able to respond more quickly and
    effectively than we can to new or changing opportunities,
    technologies, standards, regulations or customer requirements.
    We may not be able to compete successfully with these companies,
    and these or other competitors may introduce technologies or
    services that render our technologies or services obsolete or
    less marketable. Even if our technologies and services are more
    effective than the offerings of our competitors, current or
    potential customers might prefer competitive technologies or
    services to our technologies and services. Increased competition
    is likely to result in pricing pressures, which could negatively
    impact our margins, growth rate or market share.
If we are
    unable to retain our existing customers, our financial condition
    will suffer.
Our success depends in part upon the retention of our customers,
    particularly Ascension Health and its affiliated hospitals. We
    derive our net services revenue primarily from managed service
    contracts pursuant to which we receive base fees and incentive
    payments. Customers can elect not to renew their managed service
    contracts with us upon expiration. If a managed service contract
    is not renewed or is terminated for any reason, we will not
    receive the payments we would have otherwise received over the
    life of contract. In addition, financial issues or other changes
    in customer circumstances, such as a customer change in control,
    may cause us or the customer to seek to modify or terminate a
    managed service contract, and either we or the customer may
    generally terminate a contract for material uncured breach by
    the other. If we breach a managed service contract or fail to
    perform in accordance with contractual service levels, we may
    also be liable to the customer for damages. Any of these events
    could adversely affect our business, financial condition,
    operating results and cash flows.
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We face a
    variable selling cycle to secure new managed service contracts,
    making it difficult to predict the timing of specific new
    customer relationships.
We face a variable selling cycle, typically spanning six to
    twelve months, to secure a new managed service contract. Even if
    we succeed in developing a relationship with a potential new
    customer, we may not be successful in entering into a managed
    service contract with that customer. In addition, we cannot
    accurately predict the timing of entering into managed service
    contracts with new customers due to the complex procurement
    decision processes of most healthcare providers, which often
    involves high-level or committee approvals. Consequently, we
    have only a limited ability to predict the timing of specific
    new customer relationships.
Delayed or
    unsuccessful implementation of our technologies or services with
    our customers or implementation costs that exceed our
    expectations may harm our financial results.
To implement our solution, we utilize the customer's
    existing revenue cycle management and staff and layer our
    proprietary technology tools on top of the customer's
    existing patient accounting system. Each customer's
    situation is different, and unanticipated difficulties and
    delays may arise. If the implementation process is not executed
    successfully or is delayed, our relationship with the customer
    may be adversely affected and our results of operations could
    suffer. Implementation of our solution also requires us to
    integrate our own employees into the customer's operations.
    The customer's circumstances may require us to devote a
    larger number of our employees than anticipated, which could
    increase our costs and harm our financial results.
Our quarterly
    results of operations may fluctuate as a result of factors that
    may impact our incentive and base fees, some of which may be
    outside of our control.
We recognize base fee revenue on a straight-line basis over the
    life of the managed service contract. Base fees for contracts
    which are received in advance of services delivered are
    classified as deferred revenue until services have been
    provided. Our managed service contracts generally allow for
    adjustments to the base fee. Adjustments typically occur at 90,
    180 or 360 days after the contract commences, but can also
    occur at subsequent dates as a result of factors including
    changes to the scope of operations and internal and external
    audits. In addition, our fees from hospitals affiliated with
    Ascension Health are subject to adjustment in the event
    quarterly cash collections at these hospitals deteriorate
    materially after we take over revenue cycle management
    operations. While these adjustments have never been triggered,
    if they were, our future fees from hospitals affiliated with
    Ascension Health would be reduced. Further, estimates of the
    incentive payments we have earned from providing services to
    customers in prior periods could change because the laws,
    regulations, instructions, payor contracts and rule
    interpretations governing how our customers receive payments
    from payors are complex and change frequently. All adjustments,
    the timing of which are often dependent on factors outside of
    our control and which can increase or decrease our revenue and
    operating margin, are recorded in the period the changes are
    known and collectibility is reasonably assured. Any such
    adjustments may cause our quarter-to-quarter results of
    operations to fluctuate.
If we lose key
    personnel or if we are unable to attract, hire, integrate and
    retain key personnel and other necessary employees, our business
    would be harmed.
Our future success depends in part on our ability to attract,
    hire, integrate and retain key personnel. Our future success
    also depends on the continued contributions of our executive
    officers and other key personnel, each of whom may be difficult
    to replace. In particular, Mary A. Tolan, our president and
    chief executive officer, is critical to the management of our
    business and operations and the development of our strategic
    direction. The loss of services of Ms. Tolan or any of our
    other executive officers or key personnel or the inability to
    continue to attract qualified personnel could have a material
    adverse effect on our business. The replacement of any of these
    key personnel would involve significant time and expense and may
    significantly delay or prevent the achievement of our business
    objectives. Competition for the caliber and number of employees
    we require is intense. We
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may face difficulty identifying and hiring qualified personnel
    at compensation levels consistent with our existing compensation
    and salary structure. In addition, we invest significant time
    and expense in training each of our employees, which increases
    their value to competitors who may seek to recruit them. If we
    fail to retain our employees, we could incur significant
    expenses in hiring, integrating and training their replacements
    and the quality of our services and our ability to serve our
    customers could diminish, resulting in a material adverse effect
    on our business.
If we fail to
    manage future growth effectively, our business would be
    harmed.
We have expanded our operations significantly since inception
    and anticipate expanding further. For example, our net services
    revenue increased from $16.2 million in 2004 to
    $398.5 million in 2008, and the number of our full-time
    employees increased from two at January 1, 2004 to 1,305 as
    of June 30, 2009. This growth has placed significant
    demands on our management, infrastructure and other resources.
    To manage future growth, we will need to hire, integrate and
    retain highly skilled and motivated employees. We will also need
    to continue to improve our financial and management controls,
    reporting systems and procedures. If we do not effectively
    manage our growth, we may not be able to execute on our business
    plan, respond to competitive pressures, take advantage of market
    opportunities, satisfy customer requirements or maintain
    high-quality service offerings.
Disruptions in
    service or damage to our data centers and shared services
    centers could adversely affect our business.
Our data centers and shared services centers are essential to
    our business. Our operations depend on our ability to operate
    our shared service centers, and to maintain and protect our
    applications, which are located in data centers that are
    operated for us by third parties. We cannot control or assure
    the continued or uninterrupted availability of these third party
    data centers. In addition, our information technologies and
    systems, as well as our data centers and shared services
    centers, are vulnerable to damage or interruption from various
    causes, including (i) acts of God and other natural
    disasters, war and acts of terrorism and (ii) power losses,
    computer systems failures, Internet and telecommunications or
    data network failures, operator error, losses of and corruption
    of data and similar events. We conduct business continuity
    planning and maintain insurance against fires, floods, other
    natural disasters and general business interruptions to mitigate
    the adverse effects of a disruption, relocation or change in
    operating environment at one of our data centers or shared
    services centers, but the situations we plan for and the amount
    of insurance coverage we maintain may not be adequate in any
    particular case. In addition, the occurrence of any of these
    events could result in interruptions, delays or cessations in
    service to our customers, or in interruptions, delays or
    cessations in the direct connections we establish between our
    customers and third-party payors. Any of these events could
    impair or prohibit our ability to provide our services, reduce
    the attractiveness of our services to current or potential
    customers and adversely impact our financial condition and
    results of operations.
In addition, despite the implementation of security measures,
    our infrastructure, data centers, shared services centers or
    systems that we interface with, including the Internet and
    related systems, may be vulnerable to physical break-ins,
    hackers, improper employee or contractor access, computer
    viruses, programming errors, denial-of-service attacks or other
    attacks by third parties seeking to disrupt operations or
    misappropriate information or similar physical or electronic
    breaches of security. Any of these can cause system failure,
    including network, software or hardware failure, which can
    result in service disruptions. As a result, we may be required
    to expend significant capital and other resources to protect
    against security breaches and hackers or to alleviate problems
    caused by such breaches.
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If our
    security measures are breached or fail and unauthorized access
    is obtained to a customer's data, our service may be
    perceived as not being secure, the attractiveness of our
    services to current or potential customers may be reduced, and
    we may incur significant liabilities.
Our services involve the storage and transmission of
    customers' proprietary information and protected health,
    financial, payment and other personal information of patients.
    We rely on proprietary and commercially available systems,
    software, tools and monitoring, as well as other processes, to
    provide security for processing, transmission and storage of
    such information, and because of the sensitivity of this
    information, the effectiveness of such security efforts is very
    important. The systems currently used for transmission and
    approval of credit card transactions, and the technology
    utilized in credit cards themselves, all of which can put credit
    card data at risk, are determined and controlled by the payment
    card industry, not by us. If our security measures are breached
    or fail as a result of third-party action, employee error,
    malfeasance or otherwise, someone may be able to obtain
    unauthorized access to customer or patient data. Improper
    activities by third parties, advances in computer and software
    capabilities and encryption technology, new tools and
    discoveries and other events or developments may facilitate or
    result in a compromise or breach of our computer systems.
    Techniques used to obtain unauthorized access or to sabotage
    systems change frequently and generally are not recognized until
    launched against a target, and we may be unable to anticipate
    these techniques or to implement adequate preventive measures.
    Our security measures may not be effective in preventing these
    types of activities, and the security measures of our
    third-party data centers and service providers may not be
    adequate. If a breach of our security occurs, we could face
    damages for contract breach, penalties for violation of
    applicable laws or regulations, possible lawsuits by individuals
    affected by the breach and significant remediation costs and
    efforts to prevent future occurrences. In addition, whether
    there is an actual or a perceived breach of our security, the
    market perception of the effectiveness of our security measures
    could be harmed and we could lose current or potential customers.
We may be
    liable to our customers or third parties if we make errors in
    providing our services, and our anticipated net services revenue
    may be lower if we provide poor service.
The services we offer are complex, and we make errors from time
    to time. Errors can result from the interface of our proprietary
    technology tools and a customer's existing patient
    accounting system, or we may make human errors in any aspect of
    our service offerings. The costs incurred in correcting any
    material errors may be substantial and could adversely affect
    our operating results. Our customers, or third parties such as
    our customers' patients, may assert claims against us
    alleging that they suffered damages due to our errors, and such
    claims could subject us to significant legal defense costs and
    adverse publicity regardless of the merits or eventual outcome
    of such claims. In addition, if we provide poor service to a
    customer and the customer therefore realizes less improvement in
    revenue yield, the incentive fee payments to us from that
    customer will be lower than anticipated.
We offer our
    services in many jurisdictions and, therefore, may be subject to
    state and local taxes that could harm our business or that we
    may have inadvertently failed to pay.
We may lose sales or incur significant costs should various tax
    jurisdictions be successful in imposing taxes on a broader range
    of services. Imposition of such taxes on our services could
    result in substantial unplanned costs, would effectively
    increase the cost of such services to our customers and may
    adversely affect our ability to retain existing customers or to
    gain new customers in the areas in which such taxes are imposed.
    For example, in 2008 Michigan began to impose a tax based on
    gross receipts in addition to tax based on net income. For the
    year ended December 31, 2008, we recorded a tax provision
    of $2.3 million, of which $1.2 million was
    attributable to the Michigan gross receipts tax.
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Our growing
    operations in India expose us to risks that could have an
    adverse effect on our costs of operations.
We employ a significant number of persons in India and expect to
    continue to add personnel in India. While there are cost
    advantages to operating in India, significant growth in the
    technology sector in India has increased competition to attract
    and retain skilled employees and has led to a commensurate
    increase in compensation costs. In the future, we may not be
    able to hire and retain such personnel at compensation levels
    consistent with our existing compensation and salary structure
    in India. In addition, our reliance on a workforce in India
    exposes us to disruptions in the business, political and
    economic environment in that region. Maintenance of a stable
    political environment is important to our operations, and
    terrorist attacks and acts of violence or war may directly
    affect our physical facilities and workforce or contribute to
    general instability. Our operations in India require us to
    comply with local laws and regulatory requirements, which are
    complex and of which we may not always be aware, and expose us
    to foreign currency exchange rate risk. Our Indian operations
    may also subject us to trade restrictions, reduced or inadequate
    protection for intellectual property rights, security breaches
    and other factors that may adversely affect our business.
    Negative developments in any of these areas could increase our
    costs of operations or otherwise harm our business.
Negative
    public perception in the United States regarding offshore
    outsourcing and proposed legislation may increase the cost of
    delivering our services.
Offshore outsourcing is a politically sensitive topic in the
    United States. For example, various organizations and public
    figures in the United States have expressed concern about a
    perceived association between offshore outsourcing providers and
    the loss of jobs in the United States. In addition, there has
    been recent publicity about the negative experience of certain
    companies that use offshore outsourcing, particularly in India.
    Current or prospective customers may elect to perform such
    services themselves or may be discouraged from transferring
    these services from onshore to offshore providers to avoid
    negative perceptions that may be associated with using an
    offshore provider. Any slowdown or reversal of existing industry
    trends towards offshore outsourcing would increase the cost of
    delivering our services if we had to relocate aspects of our
    services from India to the United States where operating costs
    are higher.
Legislation in the United States may be enacted that is intended
    to discourage or restrict offshore outsourcing. In the United
    States, federal and state legislation has been proposed, and
    enacted in several states, that could restrict or discourage
    U.S. companies from outsourcing their services to companies
    outside the United States. For example, legislation has been
    proposed that would require offshore providers to identify where
    they are located. In addition, legislation has been enacted in
    at least one state that requires that state contracts for
    services be performed within the United States, while several
    other states provide a preference to state contracts that are
    performed within the state. It is possible that legislation
    could be adopted that would restrict U.S. private sector
    companies that have federal or state government contracts, or
    that receive government funding or reimbursement, such as
    Medicare or Medicaid payments, from outsourcing their services
    to offshore service providers. Any changes to existing laws or
    the enactment of new legislation restricting offshore
    outsourcing in the United States may adversely affect our
    ability to do business, particularly if these changes are
    widespread, and could have a material adverse effect on our
    business, results of operations, financial condition and cash
    flows.
We may engage
    in future acquisitions that could disrupt our business, cause
    dilution to our stockholders and harm our business, operating
    results or financial condition.
Although we currently have no business acquisitions pending or
    planned, we may pursue acquisition opportunities in the future.
    We have limited experience consummating acquisitions, and
    therefore our ability as an organization to make acquisitions is
    unproven. We may not be able to find suitable acquisition
    candidates, and we may not be able to complete acquisitions on
    favorable terms. If we do complete acquisitions, we may not
    ultimately strengthen our competitive position or achieve
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our goals, or such acquisitions may be viewed negatively by
    customers, financial markets or investors. In addition, any
    acquisitions that we make could lead to difficulties in
    integrating personnel and operations from the acquired
    businesses and in retaining and motivating key personnel from
    these businesses. Acquisitions may disrupt our ongoing
    operations, divert management from day-to-day responsibilities,
    increase our expenses or adversely affect our business,
    operating results and financial condition. Future acquisitions
    may reduce our cash available for operations and other uses and
    could result in an increase in amortization expense related to
    identifiable assets acquired, potentially dilutive issuances of
    equity securities or the incurrence of debt, which could harm
    our business, operating results and financial condition.
Regulatory
    Risks
The healthcare
    industry is heavily regulated. Our failure to comply with
    regulatory requirements could create liability for us, result in
    adverse publicity and negatively affect our
    business.
The healthcare industry is heavily regulated and is subject to
    changing political, legislative, regulatory and other
    influences. Many healthcare laws are complex, and their
    application to specific services and relationships may not be
    clear. In particular, many existing healthcare laws and
    regulations, when enacted, did not anticipate the services that
    we provide. We believe we have structured our operations to
    comply with all material legal requirements that are applicable
    to us, but there can be no assurance that our operations will
    not be challenged or adversely affected by enforcement
    initiatives. Our failure to accurately anticipate the
    application of these laws and regulations to our business, or
    any other failure to comply with regulatory requirements, could
    create liability for us, result in adverse publicity and
    negatively affect our business. Federal and state legislatures
    and agencies periodically consider proposals to revise aspects
    of the healthcare industry or to revise or create additional
    statutory and regulatory requirements. Such proposals, if
    implemented, could impact our operations, the use of our
    services and our ability to market new services, or could create
    unexpected liabilities for us. We are unable to predict what
    changes to laws or regulations might be made in the future or
    how those changes could affect our business or our operating
    costs.
Developments
    in the healthcare industry, including national healthcare
    reform, could adversely affect our business.
The healthcare industry has changed significantly in recent
    years and we expect that significant changes will continue to
    occur. The timing and impact of developments in the healthcare
    industry are difficult to predict. We cannot be sure that the
    markets for our services will continue to exist at current
    levels or that we will have adequate technical, financial and
    marketing resources to react to changes in those markets.
National healthcare reform is currently a major policy issue at
    the federal level. The Obama administration has made healthcare
    reform a priority, and legislative proposals are currently being
    debated by Congress. Some of the underlying themes of current
    reform proposals — quality and cost, uninsured
    coverage and healthcare information technology — are
    broadly targeted to drive greater efficiency in the
    U.S. healthcare system by, among other things, rewarding
    quality and coordination of care and promoting broader adoption
    of electronic medical records.
Although it is impossible to predict what healthcare reform
    legislation, if any, will be enacted, proposals currently being
    debated could have adverse consequences for the hospitals we
    serve and for us. Healthcare reform could, for example, result
    in additional or costly legal and regulatory requirements that
    are applicable to us and our customers, encourage more companies
    to enter our market, provide advantages to our competitors and
    result in the development of solutions that compete with ours.
    In addition, healthcare reform could result in an increase to
    the number or scope
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of federal or state charity care programs or community benefits
    programs, which may adversely affect our claim collection and
    recovery efforts.
If a breach of
    our measures protecting personal data covered by the Health
    Insurance Portability and Accountability Act or Health
    Information Technology for Economic and Clinical Health Act
    occurs, we may incur significant liabilities.
The Health Insurance Portability and Accountability Act of 1996,
    as amended, and the regulations that have been issued under it,
    which we refer to collectively as HIPAA, contain substantial
    restrictions and requirements with respect to the use and
    disclosure of individuals' protected health information.
    Under HIPAA, covered entities must establish administrative,
    physical and technical safeguards to protect the
    confidentiality, integrity and availability of electronic
    protected health information maintained or transmitted by them
    or by others on their behalf. In February 2009 HIPAA was amended
    by the Health Information Technology for Economic and Clinical
    Health, or HITECH, Act to add provisions that will, beginning in
    2010, impose certain of the HIPAA privacy and security
    requirements directly upon business associates of covered
    entities. When new regulations take effect in late 2009, both
    covered entities and their business associates will be required
    to notify individuals and government authorities of data
    security breaches involving unsecured protected health
    information. We may be viewed as a business associate of a
    covered entity under HIPAA and the HITECH Act. We have
    implemented and maintain physical, technical and administrative
    safeguards intended to protect all personal data and have
    processes in place to assist us in complying with applicable
    laws and regulations regarding the protection of this data and
    properly responding to any security incidents. A knowing breach
    of the HITECH Act's requirements could expose us to
    criminal liability. A breach of our safeguards and processes
    that is not due to reasonable cause or involves willful neglect
    could expose us to civil penalties and the possibility of civil
    litigation.
If we fail to
    comply with federal and state laws governing submission of false
    or fraudulent claims to government healthcare programs and
    financial relationships among healthcare providers, we may be
    subject to civil and criminal penalties or loss of eligibility
    to participate in government healthcare programs.
A number of federal and state laws, including anti-kickback
    restrictions and laws prohibiting the submission of false or
    fraudulent claims, apply to healthcare providers, physicians and
    others that make, offer, seek or receive referrals or payments
    for products or services that may be paid for through any
    federal or state healthcare program and, in some instances, any
    private program. These laws are complex and their application to
    our specific services and relationships may not be clear and may
    be applied to our business in ways that we do not anticipate.
    Federal and state regulatory and law enforcement authorities
    have recently increased enforcement activities with respect to
    Medicare and Medicaid fraud and abuse regulations and other
    healthcare reimbursement laws and rules. From time to time,
    participants in the healthcare industry receive inquiries or
    subpoenas to produce documents in connection with government
    investigations. We could be required to expend significant time
    and resources to comply with these requests, and the attention
    of our management team could be diverted by these efforts.
    Furthermore, if we are found to be in violation of any federal
    or state fraud and abuse laws, we could be subject to civil and
    criminal penalties, and we could be excluded from participating
    in federal and state healthcare programs such as Medicare and
    Medicaid. The occurrence of any of these events could give our
    customers the right to terminate our managed service contracts
    with them and result in significant harm to our business and
    financial condition.
The federal anti-kickback law prohibits any person or entity
    from offering, paying, soliciting or receiving anything of
    value, directly or indirectly, for the referral of patients
    covered by Medicare, Medicaid and other federal healthcare
    programs or the leasing, purchasing, ordering or arranging for
    or recommending the lease, purchase or order of any item, good,
    facility or service covered by these programs. Many states have
    adopted similar prohibitions against kickbacks and other
    practices that are intended to induce referrals, and some of
    these state laws are applicable to all patients regardless
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of whether the patient is covered under a governmental health
    program or private health plan. We evaluate our business
    relationships and activities to comply with the federal
    anti-kickback statute and similar laws, and we seek to structure
    our financial arrangements in a manner that is consistent with
    the requirements of applicable safe harbors to these laws. We
    cannot assure you, however, that our arrangements will be
    protected by such safe harbors or that such increased
    enforcement activities will not directly or indirectly have an
    adverse effect on our business financial condition or results of
    operations. Any determination by a federal or state agency that
    any of our activities or those of our vendors or customers
    violate any of these laws could subject us to civil or criminal
    penalties, could require us to change or terminate some portions
    of our operations or business, could disqualify us from
    providing services to healthcare providers doing business with
    government programs, could give our customers the right to
    terminate our managed service contracts with them and, thus,
    could have a material adverse effect on our business and results
    of operations.
There are also numerous federal and state laws that forbid
    submission of false information or the failure to disclose
    information in connection with the submission and payment of
    physician claims for reimbursement. In particular, the federal
    False Claims Act, or the FCA, prohibits a person from knowingly
    presenting or causing to be presented a false or fraudulent
    claim for payment or approval by an officer, employee or agent
    of the United States. In addition, the FCA prohibits a person
    from knowingly making, using, or causing to be made or used a
    false record or statement material to such a claim. Violations
    of the FCA may result in treble damages, significant monetary
    penalties, and other collateral consequences including,
    potentially, exclusion from participation in federally funded
    health care programs. The scope and implications of the recent
    amendments pursuant to the Fraud Enforcement and Recovery Act of
    2009, or FERA, have yet to be fully determined or adjudicated
    and as a result it is difficult to predict how future
    enforcement initiatives may impact our business.
These laws and regulations may change rapidly, and it is
    frequently unclear how they apply to our business. Errors
    created by our proprietary tools or services that relate to
    entry, formatting, preparation or transmission of claim or cost
    report information may be determined or alleged to be in
    violation of these laws and regulations. Any failure of our
    proprietary tools or services to comply with these laws and
    regulations could result in substantial civil or criminal
    liability and could, among other things, adversely affect demand
    for our services, invalidate all or portions of some of our
    managed service contracts with our customers, require us to
    change or terminate some portions of our business, require us to
    refund portions of our base fee revenues and incentive payment
    revenues, cause us to be disqualified from serving customers
    doing business with government payers, and give our customers
    the right to terminate our managed service contracts with them,
    any one of which could have an adverse effect on our business.
Our failure to
    comply with debt collection and consumer credit reporting
    regulations could subject us to fines and other liabilities,
    which could harm our reputation and business.
The U.S. Fair Debt Collection Practices Act, or FDCPA,
    regulates persons who regularly collect or attempt to collect,
    directly or indirectly, consumer debts owed or asserted to be
    owed to another person. Certain of our accounts receivable
    activities may be subject to the FDCPA. Many states impose
    additional requirements on debt collection communications, and
    some of those requirements may be more stringent than the
    comparable federal requirements. Moreover, regulations governing
    debt collection are subject to changing interpretations that may
    be inconsistent among different jurisdictions. We are also
    subject to the Fair Credit Reporting Act, or FCRA, which
    regulates consumer credit reporting and which may impose
    liability on us to the extent that the adverse credit
    information reported on a consumer to a credit bureau is false
    or inaccurate. We could incur costs or could be subject to fines
    or other penalties under the FCRA if the Federal Trade
    Commission determines that we have mishandled protected
    information. We or our customers could be required to report
    such breaches to affected consumers or regulatory authorities,
    leading to disclosures that could damage our reputation or harm
    our business, financial position and operating results.
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Potential
    additional regulation of the disclosure of health information
    outside the United States may increase our costs.
Federal or state governmental authorities may impose additional
    data security standards or additional privacy or other
    restrictions on the collection, use, transmission and other
    disclosures of health information. Legislation has been proposed
    at various times at both the federal and the state levels that
    would limit, forbid or regulate the use or transmission of
    medical information pertaining to U.S. patients outside of
    the United States. Such legislation, if adopted, may render our
    operations in India impracticable or substantially more
    expensive. Moving such operations to the United States may
    involve substantial delay in implementation and increased costs.
Risks Related to
    Intellectual Property
We may be
    unable to adequately protect our intellectual
    property.
Our success depends, in part, upon our ability to establish,
    protect and enforce our intellectual property and other
    proprietary rights. If we fail to establish or protect our
    intellectual property rights, we may lose an important advantage
    in the market in which we compete. We rely upon a combination of
    trademark, copyright and trade secret law and contractual terms
    and conditions to protect our intellectual property rights, all
    of which provide only limited protection. We cannot assure you
    that our intellectual property rights are sufficient to protect
    our competitive advantages. Although we have filed four patent
    applications, we cannot assure you that any patents will issue
    from these applications in a manner that gives us the protection
    that we seek, or that any future patents issued to us will not
    be challenged, invalidated or circumvented. Legal standards
    relating to the validity, enforceability and scope of protection
    of patents are uncertain. Any patents that may issue in the
    future from pending or future patent applications may not
    provide sufficiently broad protection or they may not prove to
    be enforceable in actions against alleged infringers. Also, we
    cannot assure you that any trademark registrations will be
    issued for pending or future applications or that any of our
    trademarks will be enforceable or provide adequate protection of
    our proprietary rights.
We also rely in some circumstances on trade secrets to protect
    our technology. Trade secrets may lose their value if not
    properly protected. We endeavor to enter into non-disclosure
    agreements with our employees, customers, contractors and
    business partners to limit access to and disclosure of our
    proprietary information. The steps we have taken, however, may
    not prevent unauthorized use of our technology, and adequate
    remedies may not be available in the event of unauthorized use
    or disclosure of our trade secrets and proprietary technology.
    Moreover, others may reverse engineer or independently develop
    technologies that are competitive to ours or infringe our
    intellectual property.
Accordingly, despite our efforts, we may be unable to prevent
    third parties from infringing or misappropriating our
    intellectual property and using our technology for their
    competitive advantage. Any such infringement or misappropriation
    could have a material adverse effect on our business, results of
    operations and financial condition. Monitoring infringement of
    our intellectual property rights can be difficult and costly,
    and enforcement of our intellectual property rights may require
    us to bring legal actions against infringers. Infringement
    actions are inherently uncertain and therefore may not be
    successful, even when our rights have been infringed, and even
    if successful may require a substantial amount of resources and
    divert our management's attention.
Claims by
    others that we infringe their intellectual property could force
    us to incur significant costs or revise the way we conduct our
    business.
Our competitors protect their intellectual property rights by
    means such as patents, trade secrets, copyrights and trademarks.
    We have not conducted an independent review of patents issued to
    third parties. Additionally, because patent applications in the
    United States and many other jurisdictions are kept confidential
    for 18 months before they are published, we may be unaware
    of pending patent applications that relate to our proprietary
    technology. Although we have not been involved in any litigation
    related to intellectual property rights of others, from time to
    time we receive
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letters from other parties alleging, or inquiring about,
    possible breaches of their intellectual property rights. Any
    party asserting that we infringe its proprietary rights would
    force us to defend ourselves, and possibly our customers,
    against the alleged infringement. These claims and any resulting
    lawsuit, if successful, could subject us to significant
    liability for damages and invalidation of our proprietary rights
    or interruption or cessation of our operations. The software and
    technology industries are characterized by the existence of a
    large number of patents, copyrights, trademarks and trade
    secrets and by frequent litigation based on allegations of
    infringement or other violations of intellectual property
    rights. Moreover, the risk of such a lawsuit will likely
    increase as our size and scope of our services and technology
    platforms increase, as our geographic presence and market share
    expand and as the number of competitors in our market increases.
    Any such claims or litigation could:
•
be time-consuming and expensive to defend, whether meritorious
    or not;
•
require us to stop providing the services that use the
    technology that infringes the other party's intellectual
    property;
•
divert the attention of our technical and managerial resources;
•
require us to enter into royalty or licensing agreements with
    third parties, which may not be available on terms that we deem
    acceptable, if at all;
•
prevent us from operating all or a portion of our business or
    force us to redesign our services and technology platforms,
    which could be difficult and expensive and may make the
    performance or value of our service offerings less attractive;
•
subject us to significant liability for damages or result in
    significant settlement payments; or
•
require us to indemnify our customers as we are required by
    contract to indemnify some of our customers for certain claims
    based upon the infringement or alleged infringement of any third
    party's intellectual property rights resulting from our
    customers' use of our intellectual property.
Intellectual property litigation can be costly. Even if we
    prevail, the cost of such litigation could deplete our financial
    resources. Litigation is also time-consuming and could divert
    management's attention and resources away from our
    business. Furthermore, during the course of litigation,
    confidential information may be disclosed in the form of
    documents or testimony in connection with discovery requests,
    depositions or trial testimony. Disclosure of our confidential
    information and our involvement in intellectual property
    litigation could materially adversely affect our business. Some
    of our competitors may be able to sustain the costs of complex
    intellectual property litigation more effectively than we can
    because they have substantially greater resources. In addition,
    any uncertainties resulting from the initiation and continuation
    of any litigation could significantly limit our ability to
    continue our operations and could harm our relationships with
    current and prospective customers. Any of the foregoing could
    disrupt our business and have a material adverse effect on our
    operating results and financial condition.
Risks Related to
    this Offering and Ownership of Shares of Our Common
    Stock
The trading
    price of our common stock is likely to be volatile, and you may
    not be able to sell your shares at or above the initial public
    offering price.
Our common stock has no prior trading history, and an active
    public market for these shares may not develop or be sustained
    after this offering. The initial public offering price for our
    common stock will be determined through negotiations with the
    representatives of the underwriters. This price will not
    necessarily reflect the price at which investors in the market
    will be willing to buy and sell our shares following this
    offering. In addition, the trading price of our common stock is
    likely to be highly volatile and could be subject to wide
    fluctuations in response to various factors. In addition to the
    risks
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described in this section, factors that may cause the market
    price of our common stock to fluctuate include:
•
fluctuations in our quarterly financial results or the quarterly
    financial results of companies perceived to be similar to us;
•
changes in estimates of our financial results or recommendations
    by securities analysts;
•
investors' general perception of us; and
•
changes in general economic, industry and market conditions.
In addition, if the stock market in general experiences a loss
    of investor confidence, the trading price of our common stock
    could decline for reasons unrelated to our business, financial
    condition or results of operations.
Some companies that have had volatile market prices for their
    securities have had securities class actions filed against them.
    If a suit were filed against us, regardless of its merits or
    outcome, it would likely result in substantial costs and divert
    management's attention and resources. This could have a
    material adverse effect on our business, operating results and
    financial condition.
Our securities
    have no prior market and our stock price may decline after the
    offering.
Prior to this offering, there has been no public market for
    shares of our common stock. Although we intend to apply to have
    our common stock listed on the New York Stock Exchange, an
    active public trading market for our common stock may not
    develop or, if it develops, may not be maintained after this
    offering. For example, the New York Stock Exchange imposes
    certain securities trading requirements, including minimum
    trading price, minimum number of stockholders and minimum market
    capitalization. Our company and the representatives of the
    underwriters will negotiate to determine the initial public
    offering price. The initial public offering price may be higher
    than the trading price of our common stock following this
    offering. As a result, you could lose all or part of your
    investment.
Future sales
    of shares by existing stockholders could cause our stock price
    to decline.
If our existing stockholders sell, or indicate an intention to
    sell, substantial amounts of our common stock in the public
    market after the contractual
lock-up
agreements described below expire and other restrictions on
    resale lapse, the trading price of our common stock could
    decline below the initial public offering price. Based on shares
    outstanding as of June 30, 2009, upon the closing of this
    offering, we will have
    outstanding           shares
    of common stock. Of these
    shares,           shares
    of common stock will be eligible for sale in the public market
    and           shares
    of common stock will be subject to a
180-day
contractual
lock-up
with
    the underwriters. Goldman, Sachs & Co. and Credit
    Suisse Securities (USA) LLC, acting as representatives of the
    underwriters, may permit our officers, directors, employees and
    current stockholders who are subject to the contractual
lock-up
to
    sell shares prior to the expiration of the
lock-up
agreements. Upon expiration of the contractual
lock-up
agreements with the underwriters, and based on shares
    outstanding as of June 30, 2009, an
    additional           shares
    will be eligible for sale in the public market.
Some of our existing stockholders have demand and incidental
    registration rights to require us to register with the SEC up
    to           shares
    of our common stock. If we register these shares of common
    stock, the stockholders would be able to sell those shares
    freely in the public market.
See "Shares Eligible for Future Sale" for further
    details regarding the number of shares eligible for sale in the
    public market after this offering.
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Insiders will
    continue to have substantial control over us after this offering
    and will be able to determine substantially all matters
    requiring stockholder approval.
Upon the closing of this offering, our directors and executive
    officers and their affiliates will beneficially own, in the
    aggregate, approximately     % of our
    outstanding common stock, assuming no exercise of the
    underwriters' option to purchase additional shares. As a
    result, these stockholders will be able to determine
    substantially all matters requiring stockholder approval,
    including the election of directors and approval of significant
    corporate transactions, such as a merger or other sale of our
    company or its assets. This concentration of ownership could
    limit your ability to influence corporate matters and may have
    the effect of delaying or preventing a third-party from
    acquiring control over us. For information regarding the
    ownership of our outstanding stock by our executive officers and
    directors and their affiliates, see "Principal and Selling
    Stockholders".
We will incur
    significant increased costs as a result of operating as a public
    company, and our management will be required to devote
    substantial time to public company compliance
    matters.
We have never operated as a public company. As a public company,
    we will incur significant legal, accounting and other expenses
    that we did not incur as a private company. In addition, the
    Sarbanes-Oxley Act of 2002, as well as rules subsequently
    implemented by the SEC and the New York Stock Exchange, have
    imposed various new requirements on public companies, including
    requiring changes in corporate governance practices. Our
    management and other personnel will need to devote a substantial
    amount of time to compliance with our public company
    obligations. Moreover, these rules and regulations will increase
    our legal and financial compliance costs and will make some
    activities more time-consuming and costly. For example, we
    expect these rules and regulations to make it more difficult and
    more expensive for us to obtain director and officer liability
    insurance.
The Sarbanes-Oxley Act requires, among other things, that we
    maintain effective internal control over financial reporting and
    disclosure controls and procedures. In particular, commencing
    with our fiscal year ending December 31, 2010, we must
    perform system and process evaluation and testing of our
    internal control over financial reporting to allow management
    and our independent registered public accounting firm to report
    on the effectiveness of our internal control over financial
    reporting, as required by Section 404 of the Sarbanes-Oxley
    Act. Our testing, or the subsequent testing by our independent
    registered public accounting firm, may reveal deficiencies in
    our internal control over financial reporting that are deemed to
    be material weaknesses. Our compliance with Section 404
    will require that we incur substantial accounting expense and
    expend significant management time on compliance-related issues.
    Preparing for compliance with Section 404 will require us
    to strengthen our internal controls, improve our processes and
    systems for financial reporting and internal controls, and hire
    additional accounting and financial staff with appropriate
    public company experience and technical accounting knowledge.
    Moreover, if we are not able to comply with the requirements of
    Section 404 in a timely manner, or if we or our independent
    registered public accounting firm identifies deficiencies in our
    internal control over financial reporting that are deemed to be
    material weaknesses, the market price of our stock could
    decline, and we could be subject to sanctions or investigations
    by the New York Stock Exchange, the SEC or other regulatory
    authorities, which would require additional financial and
    management resources.
If securities
    or industry analysts do not publish research or publish
    inaccurate or unfavorable research about our business, our stock
    price and trading volume could decline.
The trading market for our common stock will depend in part on
    the research and reports that securities or industry analysts
    publish about us or our business. We do not currently have and
    may never obtain widespread research coverage by securities and
    industry analysts. In the event we obtain securities or industry
    analyst coverage, if one or more of the analysts who covers us
    downgrades our stock or publishes inaccurate or unfavorable
    research about our business, our stock price would likely
    decline. If one or more of these analysts ceases coverage of our
    company or fails to publish reports
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on us regularly, demand for our stock could decrease, which
    could cause our stock price and trading volume to decline.
You will
    experience substantial dilution as a result of this offering and
    future equity issuances.
The initial public offering price per share is substantially
    higher than the pro forma net tangible book value per share of
    our common stock outstanding prior to this offering. As a
    result, investors purchasing common stock in this offering will
    experience immediate substantial dilution of
    $      per share. In addition, we have
    issued options to acquire common stock at prices significantly
    below the initial public offering price. To the extent
    outstanding options are ultimately exercised, there will be
    further dilution to investors in this offering. This dilution is
    due in large part to the fact that our earlier investors paid
    substantially less than the initial public offering price when
    they purchased their shares of common stock. In addition, if the
    underwriters exercise their option to purchase additional
    shares, if outstanding warrants to purchase our common stock are
    exercised, or if we issue additional equity securities, you will
    experience additional dilution.
Anti-takeover
    provisions in our charter documents and Delaware law could
    discourage, delay or prevent a change in control of our company
    and may affect the trading price of our common
    stock.
We are a Delaware corporation and the anti-takeover provisions
    of the Delaware General Corporation Law may discourage, delay or
    prevent a change in control by prohibiting us from engaging in a
    business combination with an interested stockholder for a period
    of three years after the person becomes an interested
    stockholder, even if a change in control would be beneficial to
    our existing stockholders. In addition, our restated certificate
    of incorporation and amended and restated bylaws may discourage,
    delay or prevent a change in our management or control over us
    that stockholders may consider favorable. Our restated
    certificate of incorporation and amended and restated bylaws,
    which will be in effect prior to the closing of this offering:
•
authorize the issuance of "blank check" preferred
    stock that could be issued by our board of directors to thwart a
    takeover attempt;
•
establish a classified board of directors, as a result of which
    the successors to the directors whose terms have expired will be
    elected to serve from the time of election and qualification
    until the third annual meeting following their election;
•
require that directors only be removed from office for cause and
    only upon a supermajority stockholder vote;
•
provide that vacancies on the board of directors, including
    newly created directorships, may be filled only by a majority
    vote of directors then in office;
•
limit who may call special meetings of stockholders;
•
prohibit stockholder action by written consent, requiring all
    actions to be taken at a meeting of the stockholders; and
•
require supermajority stockholder voting to effect certain
    amendments to our restated certificate of incorporation and
    amended and restated bylaws.
For additional information regarding these and other
    anti-takeover provisions, see "Description of Capital
    Stock — Anti-Takeover Effects of Our Charter and
    Bylaws and Delaware Law".
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Our management
    will have broad discretion over the use of the proceeds we
    receive in this offering and might not apply the proceeds in
    ways that increase the value of your investment.
Our management will have broad discretion to use the net
    proceeds from this offering, and you will be relying on the
    judgment of our management regarding the application of these
    proceeds. Our management might not apply the net proceeds of
    this offering in ways that increase the value of your
    investment. We expect to use the net proceeds from this offering
    for general corporate purposes, which may include financing our
    growth, developing new services and funding capital
    expenditures, acquisitions and investments. You will not have
    the opportunity to influence our decisions on how to use the net
    proceeds from this offering.
We do not
    anticipate paying any cash dividends on our capital stock in the
    foreseeable future following the closing of this
    offering.
Although we paid a cash dividend on our capital stock in July
    2008 and declared another cash dividend on our capital stock in
    August 2009, we do not expect to pay cash dividends on our
    common stock in the foreseeable future following the closing of
    this offering. Any future dividend payments will be within the
    absolute discretion of our board of directors and will depend
    on, among other things, our financial condition, results of
    operations, capital requirements, capital expenditure
    requirements, contractual restrictions, provisions of applicable
    law and other factors that our board of directors may deem
    relevant. We may not generate sufficient cash from operations in
    the future to pay dividends on our common stock. See
    "Dividend Policy".
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SPECIAL
    NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements that involve
    substantial risks and uncertainties. All statements, other than
    statements of historical facts, included in this prospectus
    regarding our strategy, future operations, future financial
    position, future revenue, projected costs, prospects, plans,
    objectives of management and expected market growth are
    forward-looking statements. The words "anticipate",
    "believe", "estimate", "expect",
    "intend", "may", "plan",
    "predict", "project", "will",
    "would" and similar expressions are intended to
    identify forward-looking statements, although not all
    forward-looking statements contain these identifying words.
    These forward-looking statements include, among other things,
    statements about:
•
our ability to attract and retain customers;
•
our financial performance;
•
the advantages of our solution as compared to those of others;
•
our new quality/cost service initiative;
•
our ability to establish and maintain intellectual property
    rights;
•
our ability to retain and hire necessary employees and
    appropriately staff our operations; and
•
our estimates regarding capital requirements and needs for
    additional financing.
We may not actually achieve the plans, intentions or
    expectations disclosed in our forward-looking statements, and
    you should not place undue reliance on our forward-looking
    statements. Actual results or events could differ materially
    from the plans, intentions and expectations disclosed in the
    forward-looking statements we make. We have included important
    factors in the cautionary statements included in this
    prospectus, particularly in the "Risk Factors"
    section, that could cause actual results or events to differ
    materially from the forward-looking statements that we make. Our
    forward-looking statements do not reflect the potential impact
    of any future acquisitions, mergers, dispositions, joint
    ventures or investments we may make.
You should read this prospectus and the documents that we have
    filed as exhibits to the registration statement, of which this
    prospectus is a part, completely and with the understanding that
    our actual future results may be materially different from what
    we expect. We do not assume any obligation to update any
    forward-looking statements, whether as a result of new
    information, future events or otherwise, except as required by
    law.
INDUSTRY AND
    MARKET DATA
We obtained the industry and market data in this prospectus from
    our own research as well as from industry and general
    publications, surveys and studies conducted by third parties.
    Industry and general publications, studies and surveys generally
    state that they have been obtained from sources believed to be
    reliable, although they do not guarantee the accuracy or
    completeness of such information. While we believe that these
    publications, studies and surveys are reliable, we have not
    independently verified the data contained in them. In addition,
    while we believe that the results and estimates from our
    internal research are reliable, such results and estimates have
    not been verified by any independent source.
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USE OF
    PROCEEDS
We estimate that we will receive net proceeds from this offering
    of approximately $      million,
    or $      million if the
    underwriters exercise their option to purchase additional shares
    in full, based on an assumed initial public offering price of
    $      per share, the midpoint of the
    estimated price range shown on the cover of this prospectus, and
    after deducting the estimated underwriting discount and offering
    expenses payable by us. We will not receive any proceeds from
    the sale of shares of common stock by the selling stockholders.
A $1.00 increase (decrease) in the assumed initial public
    offering price of $      , the midpoint
    of the estimated price range shown on the cover of this
    prospectus, would increase (decrease) the net proceeds to us
    from this offering by
    $      million, assuming the
    number of shares offered by us, as set forth on the cover of
    this prospectus, remains the same and after deducting the
    estimated underwriting discount and offering expenses payable by
    us.
We intend to use approximately
    $      million of our net proceeds
    of this offering to pay the preferred stock liquidation
    preferences that will be paid in cash to the holders of our
    outstanding preferred stock concurrently with the conversion of
    such shares into shares of our common stock upon the closing of
    this offering. We intend to use the remainder of our net
    proceeds of this offering for general corporate purposes, which
    may include financing our growth, developing new services and
    funding capital expenditures, acquisitions and investments. In
    addition, the other principal purposes for this offering are to:
•
increase our visibility in the markets we serve;
•
strengthen our balance sheet and increase the likelihood that we
    remain debt-free;
•
create a public market for our common stock;
•
facilitate our future access to the public capital markets;
•
provide liquidity for our existing stockholders;
•
improve the effectiveness of our equity compensation plans in
    attracting and retaining key employees; and
•
enhance our ability to acquire complementary businesses or
    technologies.
Except for the preferred stock liquidation preference payments
    described above, we have not yet determined with any certainty
    the manner in which we will allocate our net proceeds. Our
    management will retain broad discretion in the allocation and
    use of our net proceeds of this offering. The amounts and timing
    of these expenditures will vary depending on a number of
    factors, including the amount of cash generated by our
    operations, competitive and technological developments, and the
    rate of growth, if any, of our business. For example, if we were
    to expand our operations more rapidly than anticipated by our
    current plans, a greater portion of the proceeds would likely be
    used for the development or enhancement of our proprietary
    technologies. Alternatively, if we were to engage in an
    acquisition that required a significant cash outlay, some or all
    of the proceeds might be used for that purpose.
Although we may use a portion of the proceeds for the
    acquisition of, or investment in, companies, technologies or
    assets that complement our business, we have no present
    understandings, commitments or agreements to enter into any
    acquisitions or make any material investments. We cannot assure
    you that we will make any acquisitions or investments in the
    future.
Pending specific utilization of the net proceeds as described
    above, we intend to invest the net proceeds of the offering in
    short-term investment grade and U.S. government securities.
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DIVIDEND
    POLICY
We paid a cash dividend in the aggregate amount of
    $15.0 million, or $0.7203 per common-equivalent share, to
    holders of record as of July 11, 2008 of our common stock
    and preferred stock. In August 2009, we declared an additional
    cash dividend in the aggregate amount of $15.0 million, or
    $0.72 per common-equivalent share, to holders of record as of
    September 1, 2009 of our common stock and preferred stock.
    Approximately $13 million of this dividend is being paid in
    September 2009 and the balance in October 2009.
We currently intend to retain earnings, if any, to finance the
    growth and development of our business, and we do not expect to
    pay any cash dividends on our common stock in the foreseeable
    future following the closing of this offering. Payment of future
    dividends, if any, will be at the discretion of our board of
    directors and will depend on our financial condition, results of
    operations, capital requirements, restrictions contained in
    current or future financing instruments, provisions of
    applicable law, and other factors the board deems relevant.
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CAPITALIZATION
The following table sets forth our capitalization as of
    June 30, 2009:
•
on an actual basis;
•
on a pro forma basis to reflect
    (1) the     -for-one split of our
    common stock to be effected prior to the closing of this
    offering, (2) the automatic conversion of all outstanding
    shares of non-voting common stock into shares of common stock
    upon the closing of this offering, (3) the automatic
    conversion of all outstanding shares of convertible preferred
    stock into shares of common stock upon the closing of this
    offering and (4) the assumed issuance
    of           shares
    of common stock upon exercise of warrants that will be cancelled
    if not exercised prior to this offering.
•
on a pro forma as adjusted basis to reflect (1) the items
    described in the preceding bullet, (2) the filing of our
    restated certificate of incorporation prior to the closing of
    this offering, (3) our issuance and sale
    of           shares
    of common stock in this offering at an assumed initial public
    offering price of $      per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus, after deducting the estimated underwriting discount
    and offering expenses payable by us and the application of the
    net proceeds therefrom as described in "Use of
    Proceeds", and (4) our issuance
    of          shares
    of common stock to FT Partners contemporaneously with the
    closing of this offering, based on an assumed initial public
    offering price of $      per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus.
You should read this table together with our financial
    statements and the related notes appearing at the end of this
    prospectus and the "Use of Proceeds" and
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations" sections of this
    prospectus.
June 30, 2009
Pro forma
Actual
Pro forma
as adjusted
(Unaudited)
(In thousands, except share and per share amounts)
Cash and cash equivalents
$
37,789
Stockholders' equity:
Convertible preferred stock, $0.01 par value;
    1,350,000 shares authorized and issuable in series,
    1,299,541 shares issued and outstanding, actual; no shares
    authorized, issued or outstanding, pro forma and pro forma as
    adjusted
13
—
—
Preferred stock, $0.01 par value; no shares authorized,
    issued or outstanding, actual; 5,000,000 shares authorized
    and no shares issued or outstanding, pro forma and pro forma as
    adjusted
—
—
—
Common stock, $0.01 par value:
Common stock, 17,500,000 shares authorized,
    8,178,119 shares issued and outstanding, actual;
    17,500,000 shares
    authorized,          shares
    issued and outstanding, pro
    forma;          shares
    authorized,          shares
    issued and outstanding, pro forma as adjusted
82
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June 30, 2009
Pro forma
Actual
Pro forma
as adjusted
(Unaudited)
(In thousands, except share and per share amounts)
Non-voting common stock, 8,000,000 shares authorized,
    1,321,857 shares issued and outstanding, actual; no shares
    authorized, issued or outstanding, pro forma and pro forma as
    adjusted
13
—
—
Additional paid-in capital
45,773
Non-executive employee loans for stock option exercises
(230
)
Accumulated deficit
(24,887
)
Cumulative translation adjustment
(227
)
Total stockholders' equity
20,537
Total capitalization
$
58,326
$
$
A $1.00 increase (decrease) in the assumed initial public
    offering price of $      , the midpoint
    of the estimated price range shown on the cover of this
    prospectus, would increase (decrease) each of additional paid-in
    capital and total stockholders' equity in the pro forma as
    adjusted column by $      million,
    assuming the number of shares offered by us, as set forth on the
    cover of this prospectus, remains the same and after deducting
    the estimated underwriting discount and offering expenses
    payable by us.
The table above is based on the number of shares of common stock
    outstanding as of June 30, 2009, and excludes:
•
833,334 shares of common stock issuable upon the exercise
    of warrants outstanding and exercisable as of June 30, 2009
    at a weighted-average exercise price of $1.12 per share, which
    will remain outstanding after this offering if not exercised
    prior to this offering;
•
2,440,885 shares of common stock issuable upon the exercise
    of stock options outstanding and exercisable as of June 30,
    2009 at a weighted-average exercise price of $21.59 per share,
    of which 1,054,930 shares with a weighted-average exercise
    price of $8.52 per share would be vested if purchased upon
    exercise of these options as of June 30, 2009;
•
173,828 shares of common stock available for future
    issuance under our equity compensation plans as of June 30,
    2009; and
•
an
    additional           shares
    of our common stock that will be made available for future
    issuance under our equity compensation plans upon the closing of
    this offering.
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DILUTION
If you invest in our common stock, your interest will be diluted
    immediately to the extent of the difference between the initial
    public offering price per share you will pay in this offering
    and the pro forma as adjusted net tangible book value per share
    of our common stock after this offering. Our pro forma
    historical net tangible book value as of June 30, 2009 was
    $      million, or
    $      per share of common stock. Our
    pro forma net tangible book value per share set forth below
    represents our total tangible assets less total liabilities and
    convertible preferred stock, divided by the number of shares of
    our common stock outstanding on June 30, 2009, after giving
    effect to (1) the     -for-one
    split of our common stock to be effected prior to the closing of
    this offering, (2) the automatic conversion of all
    outstanding shares of non-voting common stock into shares of
    common stock upon the closing of this offering, (3) the
    automatic conversion of all outstanding shares of convertible
    preferred stock into shares of common stock immediately prior to
    the closing of this offering and (4) the assumed issuance
    of           shares
    of common stock upon exercise of warrants that will be cancelled
    if not exercised prior to this offering.
After giving effect to our issuance and sale
    of           shares
    of common stock in this offering at an assumed initial public
    offering price of $      per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus, after deducting the estimated underwriting discount
    and offering expenses payable by us, the pro forma as adjusted
    net tangible book value as of June 30, 2009 would have been
    $      million, or
    $      per share. This represents an
    immediate increase in net tangible book value to existing
    stockholders of $      per share.
    Accordingly, new investors who purchase shares of common stock
    in this offering will suffer an immediate dilution of their
    investment of $      per share. The
    following table illustrates this per share dilution to the new
    investors purchasing shares of common stock in this offering
    without giving effect to the option to purchase additional
    shares granted to the underwriters:
Assumed initial public offering price per share
$
Pro forma net tangible book value per share as of June 30,
    2009
Increase per share attributable to sale of shares of common
    stock in this offering
Pro forma as adjusted net tangible book value per share after
    the offering
Dilution per share to new investors
$
A $1.00 increase (decrease) in the assumed initial public
    offering price of $      per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus, would increase (decrease) the net tangible book
    value by $      million, the net
    tangible book value per share after this offering by
    $      per share and the dilution in
    net tangible book value per share to investors in this offering
    by $      per share, assuming that the
    number of shares offered by us, as set forth on the cover of
    this prospectus, remains the same and after deducting the
    estimated underwriting discount and offering expenses payable by
    us.
If the underwriters exercise their option to purchase additional
    shares in full, the pro forma as adjusted net tangible book
    value will increase to $      per
    share, representing an immediate increase to existing
    stockholders of $      per share and an
    immediate dilution of $      per share
    to new investors. If any shares are issued upon exercise of
    outstanding options or warrants, you will experience further
    dilution.
The following table summarizes, on a pro forma basis as of
    June 30, 2009, the differences between the number of shares
    of common stock purchased from us, the total consideration paid
    to us, and the average price per share paid by existing
    stockholders and by new investors purchasing shares of common
    stock in this offering. The calculation below is based on an
    assumed initial public offering price of
    $      per share, the midpoint of the
    estimated price range shown on the cover of this
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prospectus, before the deduction of the estimated underwriting
    discount and offering expenses payable by us:
Shares Purchased
Total Consideration
Average Price
Number
%
Amount
%
Per Share
(In thousands)
Existing stockholders
%
$
%
$
New investors
$
Total
100
%
$
100
%
The foregoing tables and calculations are based on the number of
    shares of our common stock outstanding as of June 30, 2009
    after giving effect to
    (1) the     -for-one split of our
    common stock to be effected prior to the closing of this
    offering, (2) the automatic conversion of all outstanding
    shares of non-voting common stock into shares of common stock
    upon the closing of this offering, (3) the automatic
    conversion of all outstanding shares of convertible preferred
    stock into shares of common stock and (4) the assumed
    issuance
    of          shares
    of common stock upon exercise of warrants that will be cancelled
    if not exercised prior to this offering, and excludes:
•
833,334 shares of common stock issuable upon the exercise
    of warrants outstanding and exercisable as of June 30, 2009
    at a weighted-average exercise price of $1.12 per share, which
    will remain outstanding after this offering if not exercised
    prior to this offering;
•
2,440,885 shares of common stock issuable upon the exercise
    of stock options outstanding and exercisable as of June 30,
    2009 at a weighted-average exercise price of $21.59 per share,
    of which 1,054,930 shares with a weighted-average exercise
    price of $8.52 per share would be vested if purchased upon
    exercise of these options as of June 30, 2009;
•
173,828 shares of common stock available for future
    issuance under our equity compensation plans as of June 30,
    2009; and
•
an
    additional           shares
    of our common stock that will be made available for future
    issuance under our equity compensation plans upon the closing of
    this offering.
The sale
    of           shares
    of common stock to be sold by the selling stockholders in this
    offering will reduce the number of shares held by existing
    stockholders
    to          ,
    or     % of the total shares
    outstanding, and will increase the number of shares held by new
    investors
    to          ,
    or          %
    of the total shares outstanding. If the underwriters exercise
    their option to purchase additional shares in full, the shares
    held by existing stockholders will further decrease
    to          ,
    or     % of the total shares
    outstanding, and the number of shares held by new investors will
    further increase
    to          ,
    or     % of the total shares
    outstanding.
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SELECTED
    CONSOLIDATED FINANCIAL DATA
The following tables summarize our consolidated financial data
    for the periods presented. You should read the following
    selected consolidated financial data in conjunction with our
    financial statements and the related notes appearing at the end
    of this prospectus and the "Management's Discussion
    and Analysis of Financial Condition and Results of
    Operations" section of this prospectus.
We derived the statement of operations data for the years ended
    December 31, 2006, 2007 and 2008 and the balance sheet data
    as of December 31, 2007 and 2008 from our audited
    consolidated financial statements, which are included in this
    prospectus. We derived the statement of operations data for the
    years ended December 31, 2004 and 2005 and the balance
    sheet data as of December 31, 2004, 2005 and 2006 from our
    audited consolidated financial statements, which are not
    included in this prospectus. We derived the consolidated
    financial data for the six months ended June 30, 2008 and
    2009 and as of June 30, 2009 from our unaudited
    consolidated financial statements, which are included in this
    prospectus. In the opinion of our management, the unaudited
    consolidated financial statements have been prepared on the same
    basis as our audited financial statements and include all
    adjustments, consisting of normal recurring adjustments and
    accruals, necessary for the fair statement of the financial
    information set forth in those statements. Our historical
    results for any prior period are not necessarily indicative of
    results to be expected for a full year or any future period.
Six Months Ended
Fiscal Year Ended December 31,
June 30,
2004
2005
2006
2007
2008
2008
2009
(Unaudited)
(In thousands, except share and per share data)
Statement of Operations Data:
Net services revenue
$
16,199
$
111,201
$
160,741
$
240,725
$
398,469
$
187,261
$
238,149
Costs of services
16,098
97,120
141,767
197,676
335,211
160,082
195,667
Operating margin
101
14,081
18,974
43,049
63,258
27,179
42,482
Operating expenses:
Infused management and technology
2,082
13,037
18,875
27,872
39,234
17,938
24,482
Selling, general and administrative
4,629
4,230
8,777
15,657
21,227
9,642
15,308
Total operating expenses
6,711
17,267
27,652
43,529
60,461
27,580
39,790
Income (loss) from operations
(6,610
)
(3,186
)
(8,678
)
(480
)
2,797
(401
)
2,692
Interest income
379
626
1,359
1,710
710
433
83
Income (loss) before provision for (benefit from) income taxes
(6,231
)
(2,560
)
(7,319
)
1,230
3,507
32
2,775
Provision for (benefit from) income taxes
—
105
—
456
2,264
626
(2,439
)
Net income (loss)
$
(6,231
)
$
(2,666
)
$
(7,319
)
$
774
$
1,243
$
(594
)
$
5,214
Net income (loss) per common share:
Basic:
$
(1.41
)
$
(0.15
)
$
(0.89
)
$
0.04
$
(0.70
)
$
(0.06
)
$
0.25
Diluted:
(6.82
)
(0.16
)
(1.02
)
0.03
(0.73
)
(0.06
)
0.21
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Six Months Ended
Fiscal Year Ended December 31,
June 30,
2004
2005
2006
2007
2008
2008
2009
(Unaudited)
(In thousands, except share and per share data)
Weighted-average shares used in computing net income (loss) per
    common share:
Basic:
522,733
4,935,104
6,611,975
8,410,226
9,214,916
9,160,187
9,337,812
Diluted:
522,733
4,935,104
6,611,975
10,296,011
9,214,916
9,160,187
11,492,646
Other Operating Data (unaudited):
Adjusted EBITDA(1)
$
(5,754
)
$
(2,075
)
$
(7,125
)
$
6,842
$
12,220
$
4,620
$
11,658
Net patient revenue under management (at period end) (in
    billions)
$
2.1
$
2.4
$
4.1
$
6.9
$
9.1
$
8.5
$
11.9
As of December 31,
As of June 30,
2004
2005
2006
2007
2008
2009
(Unaudited)
(In thousands)
Balance Sheet Data:
Cash and cash equivalents
$
12,925
$
17,558
$
20,782
$
34,745
$
51,656
$
37,789
Working capital
4,494
7,817
(2,445
)
8,010
(3,453
)
4,114
Total assets
13,486
19,064
27,333
60,858
86,904
105,965
Total stockholders' equity
$
4,603
$
8,535
$
3,165
$
15,910
$
7,923
$
20,537
(1)
We define adjusted EBITDA as net
    income (loss) before net interest income (expense), income tax
    expense (benefit), depreciation and amortization expense and
    share-based compensation expense. Adjusted EBITDA is a non-GAAP
    financial measure and should not be considered as an alternative
    to net income, operating income and any other measure of
    financial performance calculated and presented in accordance
    with GAAP.
We believe adjusted EBITDA is useful to investors in evaluating
    our operating performance for the following reasons:
•
adjusted EBITDA and similar non-GAAP measures are widely used by
    investors to measure a company's operating performance
    without regard to items that can vary substantially from company
    to company depending upon financing and accounting methods, book
    values of assets, capital structures and the methods by which
    assets were acquired;
•
securities analysts often use adjusted EBITDA and similar
    non-GAAP measures as supplemental measures to evaluate the
    overall operating performance of companies; and
•
by comparing our adjusted EBITDA in different historical
    periods, our investors can evaluate our operating results
    without the additional variations of interest income (expense),
    income tax expense (benefit), depreciation and amortization
    expense and share-based compensation expense.
Our management uses adjusted EBITDA:
•
as a measure of operating performance, because it does not
    include the impact of items that we do not consider indicative
    of our core operating performance;
•
for planning purposes, including the preparation of our annual
    operating budget;
•
to allocate resources to enhance the financial performance of
    our business;
•
to evaluate the effectiveness of our business
    strategies; and
•
in communications with our board of directors and investors
    concerning our financial performance.
We understand that, although measures similar to adjusted EBITDA
    are frequently used by investors and securities analysts in
    their evaluation of companies, adjusted EBITDA has limitations
    as an analytical tool, and you should not
36
Table of Contents
consider it in isolation or as a
    substitute for analysis of our results of operations as reported
    under GAAP. Some of these limitations are:
•
adjusted EBITDA does not reflect our cash expenditures or future
    requirements for capital expenditures or other contractual
    commitments;
•
adjusted EBITDA does not reflect changes in, or cash
    requirements for, our working capital needs;
•
adjusted EBITDA does not reflect share-based compensation
    expense;
•
adjusted EBITDA does not reflect cash requirements for income
    taxes;
•
adjusted EBITDA does not reflect net interest income (expense);
•
although depreciation and amortization are non-cash charges, the
    assets being depreciated or amortized will often have to be
    replaced in the future, and adjusted EBITDA does not reflect any
    cash requirements for these replacements; and
•
other companies in our industry may calculate adjusted EBITDA
    differently than we do, limiting its usefulness as a comparative
    measure.
To properly and prudently evaluate our business, we encourage
    you to review the GAAP financial statements included elsewhere
    in this prospectus, and not to rely on any single financial
    measure to evaluate our business.
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The following table presents a reconciliation of adjusted EBITDA
    to net income (loss), the most comparable GAAP measure:
Six Months Ended
Fiscal Year Ended December 31,
June 30,
2004
2005
2006
2007
2008
2008
2009
(Unaudited)
(In thousands)
Net income (loss)
$
(6,231
)
$
(2,666
)
$
(7,319
)
$
774
$
1,243
$
(594
)
$
5,214
Net interest income(a)
(379
)
(626
)
(1,359
)
(1,710
)
(710
)
(433
)
(83
)
Provision (benefit) for income taxes
—
105
—
456
2,264
626
(2,439
)
Depreciation and amortization expense
22
99
626
1,307
2,540
920
1,882
EBITDA
$
(6,588
)
$
(3,088
)
$
(8,052
)
$
827
$
5,337
$
519
4,574
Stock compensation expense(b)
—
—
844
934
3,551
1,021
2,977
Stock warrant expense(b)
834
1,013
83
5,081
3,332
3,080
4,107
Adjusted EBITDA
$
(5,754
)
$
(2,075
)
$
(7,125
)
$
6,842
$
12,220
$
4,620
$
11,658
(a) Net interest income represents earnings from our cash
    and cash equivalents. No debt or other interest-bearing
    obligations were outstanding during any of the periods presented.
(b) Stock compensation expense and stock warrant expense
    collectively represent the
share-based
compensation expense reflected in our financial statements. Of
    the amounts presented above, $83, $928, $921, $696 and $1,334
    was classified as a reduction in net services revenue for the
    years ended December 31, 2006, 2007 and 2008 and the six
    months ended June 30, 2008 and 2009, respectively.
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MANAGEMENT'S
    DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
You should read the following discussion and analysis of our
    financial condition and results of operations together with our
    financial statements and the related notes and other financial
    information included elsewhere in this prospectus. Some of the
    information contained in this discussion and analysis or set
    forth elsewhere in this prospectus, including information with
    respect to our plans and strategy for our business and related
    financing, includes forward-looking statements that involve
    risks and uncertainties. You should review the "Risk
    Factors" section of this prospectus for a discussion of
    important factors that could cause actual results to differ
    materially from the results described in or implied by the
    forward-looking statements contained in the following discussion
    and analysis.
Overview
Our
    Background
Accretive Health is a leading provider of healthcare revenue
    cycle management services. Our business purpose is to help
    U.S. hospitals, physicians and other healthcare providers
    manage their revenue cycle operations more efficiently. Our
    integrated, end-to-end technology and services offering, which
    we refer to as our solution, helps our customers realize
    sustainable improvements in their operating margins and improve
    the satisfaction of their patients, physicians and staff. We
    enable these improvements by helping our customers increase the
    portion of the maximum potential patient revenue they receive,
    while reducing total revenue cycle costs.
Our customers typically are multi-hospital systems, including
    faith-based or community healthcare systems, academic medical
    centers and independent ambulatory clinics, and their affiliated
    physician practice groups. To implement our solution, we assume
    full responsibility for the management and cost of a
    customer's revenue cycle operations and supplement the
    customer's existing revenue cycle staff with seasoned
    Accretive Health personnel. A customer's net revenue
    improvements and cost savings generally increase over time as we
    deploy additional programs and as the programs we implement
    become more effective, which in turn provides visibility into
    our future revenue and profitability. In 2008, for example,
    approximately 80% of our net services revenue, and over 95% of
    our net income, was derived from customer contracts that were in
    place as of January 1, 2008.
Our customers have historically achieved significant net revenue
    yield improvements within 18 to 24 months of implementing
    our solution, with customers operating under mature managed
    service contracts realizing 400 to 600 basis points in
    yield improvements, typically in the third or fourth contract
    year. To date, we have experienced a contract renewal rate of
    100% (excluding exploratory new services offerings, a consensual
    termination following a change of control and a customer
    reorganization). Coupled with the long-term nature of our
    managed service contracts and the fixed nature of the base fees
    under each contract, our historical renewal experience provides
    a core source of recurring revenue.
We believe that current macroeconomic conditions will continue
    to impose financial pressure on healthcare providers and will
    increase the importance of managing their revenue cycles
    effectively and efficiently. Additionally, the continued
    operating pressures facing U.S. hospitals coupled with some
    of the underlying themes of current healthcare reform proposals
    make the efficient management of the revenue cycle and
    collection of the full amount of payments due for patient
    services among the most critical challenges facing healthcare
    providers today.
Our corporate headquarters are located in Chicago, Illinois, and
    we operate shared services centers and offices in Michigan,
    Missouri, Florida and India. As of June 30, 2009, we had
    approximately 1,300 full-time employees and managed an
    additional 6,000 revenue cycle staff persons who are employed by
    our customers.
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Net Services
    Revenue
We derive our net services revenue primarily from service
    contracts under which we manage our customers' revenue
    cycle operations. Revenues from managed service contracts
    consist of base fees and incentive payments:
•
Base fee revenues represent our fees for managing and overseeing
    our customers' revenue cycle operations, net of any cost
    savings shared with customers.
•
Incentive payment revenues represent the amounts we receive by
    increasing our customers' net patient revenue and
    identifying potential payment sources for patients who are
    uninsured and underinsured. These payments are governed by
    specific formulas contained in the managed service contract with
    each of our customers.
In addition, we earn revenue from other services, which
    primarily include our share of revenues associated with the
    collection of dormant patient accounts (more than 365 days
    old) under some of our service contracts. We also receive
    revenue from other services provided to customers that are not
    part of our integrated service offerings, such as reviewing a
    customer's charge data master or consulting on the billing
    for individuals receiving emergency room treatment.
Some of our service contracts entitle customers to receive a
    share of the cost savings we achieve from operating their
    revenue cycle. This share is returned to customers as a
    reduction in subsequent base fees. Our services revenue is
    reported net of cost sharing, and we refer to this as our net
    services revenue.
Costs of
    Services
Costs of services consist primarily of the expenses necessary to
    conduct our customers' revenue cycle operations. These
    costs include the salaries and benefits of the customers'
    employees engaged in revenue cycle activities and managed
on-site
by
    us, the salaries and benefits of our employees engaged in
    revenue cycle activities, the costs associated with vendors that
    provide services integral to the customers' revenue cycle
    and the costs associated with operating our shared services
    centers.
Operating
    Margin
Operating margin is equal to net services revenue less costs of
    services. Our operating model is designed to improve margin
    under each managed service contract as the contract matures, for
    several reasons:
•
We typically enhance the productivity of a customer's
    revenue cycle operations over time as we fully implement our
    technology and procedures and because any overlap between costs
    of our shared services centers and costs of hospital operations
    targeted for transition is generally concentrated in the first
    year of the contract.
•
Incentive payments under each managed service contract generally
    increase over time as we deploy additional programs and the
    programs we implement become more effective and produce improved
    results for our customers.
Infused
    Management and Technology Expenses
We refer to the management and staff revenue cycle employees
    that we devote to customer operations as infused management.
    Infused management and technology expenses consist primarily of
    the wages, bonuses, benefits, share based compensation, travel
    and other costs associated with deploying our employees on
    customer sites to guide and manage our customers' revenue
    cycle operations. The employees we deploy on customer sites
    typically have significant experience in revenue cycle
    operations, technology, quality control or other management
    disciplines. The other significant portion of these expenses is
    an allocation of the costs associated with maintaining,
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Table of Contents
improving and deploying our integrated proprietary technology
    suite and an allocation of the costs previously capitalized for
    developing our integrated proprietary technology suite.
Selling,
    General and Administrative Expenses
Selling, general and administrative expenses consist primarily
    of expenses for executive, sales, corporate information
    technology, legal, finance and human resources personnel,
    including wages, bonuses, benefits and share-based compensation;
    fees for professional services; share-based expense for stock
    warrants; insurance premiums; facility charges; and other
    corporate expenses. Professional services consist primarily of
    external legal, tax and audit services. We expect selling,
    general and administrative expenses to increase in absolute
    dollars as we continue to add information technology, human
    resources, finance, accounting and other administrative
    personnel as we expand our business.
We also expect to incur additional professional fees and other
    expenses resulting from future expansion and the compliance
    requirements of operating as a public company, including
    increased audit and legal expenses, investor relations expenses,
    increased insurance expenses, particularly for directors'
    and officers' liability insurance, and the costs of
    complying with Section 404 of the Sarbanes-Oxley Act. While
    these costs may initially increase as a percentage of our net
    services revenue, we expect that in the future these expenses
    will increase at a slower rate than our overall business volume,
    and that they will eventually represent a smaller percentage of
    our net services revenue.
Interest
    Income
Interest income is derived from the return achieved from our
    cash balances. We invest primarily in highly liquid, short-term
    investments, primarily those insured by the
    U.S. government. Our return on our cash investments
    declined in 2008 and the six months ended June 30, 2009 as
    a result of the general decrease in overall interest rates.
Income
    Taxes
Income tax expense consists of federal and state income taxes in
    the United States and India. Although we have net operating loss
    carryforwards, our effective tax rate in 2008 was approximately
    65%. This is due principally to the fact that a large portion of
    our operations is conducted in Michigan, which in 2008 began to
    impose a tax based on gross receipts in addition to tax based on
    net income. We expect our overall effective tax rate to be lower
    in 2009 and thereafter as the impact of the Michigan gross
    receipts tax becomes less significant in relation to other
    income-based taxes. However, we expect our income tax expense to
    increase in absolute dollars as our income increases.
Application of
    Critical Accounting Policies and Use of Estimates
Our consolidated financial statements reflect the assets,
    liabilities and results of operations of Accretive Health, Inc.
    and our wholly-owned subsidiaries, SureDecisions, Inc.,
    Accretive Health India Private Limited and Accretive Health
    India Services Private Limited. All intercompany transactions
    and balances have been eliminated in consolidation. Our
    consolidated financial statements have been prepared in
    accordance with GAAP.
The preparation of financial statements in conformity with GAAP
    requires us to make estimates and judgments that affect the
    amounts reported in our consolidated financial statements and
    the accompanying notes. We regularly evaluate the accounting
    policies and estimates we use. In general, we base estimates on
    historical experience and on assumptions that we believe to be
    reasonable given our operating environment. Estimates are based
    on our best knowledge of current events and the actions we may
    undertake in the future. Although we believe all adjustments
    considered necessary for fair presentation have been included,
    our actual results may differ materially from our estimates.
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We believe that the accounting policies described below involve
    our more significant judgments, assumptions and estimates and,
    therefore, could have the greatest potential impact on our
    consolidated financial statements. In addition, we believe that
    a discussion of these policies is necessary to understand and
    evaluate the consolidated financial statements contained in this
    prospectus. For further information on our critical and other
    significant accounting policies, see note 2 to our
    consolidated financial statements contained elsewhere in this
    prospectus.
Revenue
    Recognition
Our managed service contracts generally have an initial term of
    four to five years and various start and end dates. After the
    initial terms, these contracts renew annually unless canceled by
    either party.
We record revenue in accordance with the provisions of Staff
    Accounting Bulletin 104. As a result, we only record
    revenue once there is persuasive evidence of an arrangement,
    services have been rendered, the amount of revenue has become
    fixed or determinable and collectibility is reasonably assured.
    We recognize base fee revenues on a straight-line basis over the
    life of the managed service contract. Base fees for contracts
    which are received in advance of services delivered are
    classified as deferred revenue until services have been provided.
Our managed service contracts generally allow for adjustments to
    the base fee. Adjustments typically occur at 90, 180 or
    360 days after the contract commences, but can also occur
    at subsequent dates as a result of factors including changes to
    the scope of operations and internal and external audits. All
    adjustments, which can increase or decrease revenue and
    operating margin, are recorded in the period the changes are
    known and collectibility is reasonably assured. Any such
    adjustments may cause our quarter-to-quarter results of
    operations to fluctuate. Adjustments may vary in direction,
    frequency and magnitude and generally have not materially
    affected our annual revenue trends, margin trends, and
    visibility.
We record revenue for incentive payments once the calculation of
    the incentive payment earned is finalized and collectibility is
    reasonably assured. We use a proprietary technology and
    methodology to calculate the amount of benefit each customer
    receives as a result of our services. Our calculations are based
    in part on the amount of revenue each customer is entitled to
    receive from commercial and private insurance carriers,
    Medicare, Medicaid and patients. Because the laws, regulations,
    instructions, payor contracts and rule interpretations governing
    how our customers receive payments from these parties are
    complex and change frequently, estimates of the prior period net
    revenue yield calculations could change. All changes in
    estimates are recorded when new information is available and
    calculations are completed.
Incentive payments are based on the benefits a customer has
    received throughout the life of the managed service contract
    with us. Each quarter, we record the increase in the total
    benefits received to date. If a quarterly calculation indicates
    that the cumulative benefits to date have decreased, we record a
    reduction in revenue. If the decrease in revenue exceeds the
    amount previously paid by the customer, the excess is recorded
    as deferred revenue.
Our services also include collection of dormant patient accounts
    receivable that have aged 365 days or more directly from
    individual patients. We share all cash generated from these
    collections with our customers in accordance with specified
    arrangements. We record as revenue our portion of the cash
    received from these collections when each customer's cash
    application is complete.
Accounts
    Receivable and Allowance for Uncollectible
    Accounts
Base fees are billed to customers quarterly. Base fees received
    prior to when services are delivered are classified as deferred
    revenue. Accordingly, the timing of customer payments can result
    in short-term fluctuations in cash, accounts receivable and
    deferred revenue.
We extend unsecured credit to our customers based on our
    assessment of each customer's creditworthiness. We maintain
    an estimated allowance for doubtful accounts to reduce our gross
42
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accounts receivable to the amount that we believe will be
    collected. This allowance is reviewed and based on our
    historical experience, our assessment of each customer's
    ability to pay and the status of any ongoing operations with
    each applicable customer.
Software
    Development
We apply the provisions of the American Institute of Certified
    Public Accountants' Statement of Position
No. 98-1,
or
SOP 98-1,
Accounting for Costs of Computer Software Developed or
    Obtained for Internal Use
, which requires the capitalization
    of costs incurred in connection with developing or obtaining
    internal use software. In accordance with
SOP 98-1,
we capitalize the costs of internally-developed, internal use,
    software when an application is in the development stage. This
    generally occurs after the overall design and functionality of
    the application has been approved and our management has
    committed to the application's development. Capitalized
    software development costs consist of payroll and
    payroll-related costs for employee time spent developing a
    specific internal use software application, and external costs
    incurred that are related directly to the development of a
    specific application.
Goodwill
Goodwill represents the excess purchase price over the net
    assets acquired for SureDecisions, which we acquired in May
    2006. In accordance with Statement of Financial Accounting
    Standards No. 142,
Goodwill and Other Intangible
    Assets
, goodwill is not subject to amortization but is
    subject to impairment testing at least annually. Our annual
    impairment assessment date is the first day of our fourth
    quarter. We conduct our impairment testing on a company-wide
    basis because we have only one operating and reporting segment.
    Our impairment tests are based on our current business strategy
    in light of present industry and economic conditions and future
    expectations. As we apply our judgment to estimate future cash
    flows and an appropriate discount rate, the analysis reflects
    assumptions and uncertainties. Our estimates of future cash
    flows could differ from actual results. Our most recent
    impairment assessment did not result in goodwill impairment.
Impairments of
    Long-Lived Assets
We evaluate all of our long-lived assets, such as furniture,
    equipment, software and other intangibles, for impairment in
    accordance with Statement of Financial Accounting Standard
    No. 144,
Accounting for the Impairment or Disposal of
    Long-Lived Assets
, when events or changes in circumstances
    warrant such a review. If an evaluation is required, the
    estimated future undiscounted cash flows associated with the
    asset are compared to the asset's carrying amount to
    determine if an adjustment to fair market value is required.
    This evaluation is significantly impacted by estimates and
    assumptions of future revenue, expenses and other factors, which
    are in turn affected by changes in the business climate, legal
    matters and competition. Our most recent assessment of
    intangible assets resulted in the impairment of customer
    relationships acquired as part of our SureDecisions acquisition
    in the amount of $0.1 million, which was recorded in 2008.
Income
    Taxes
We record deferred tax assets and liabilities for future income
    tax consequences that are attributable to differences between
    the carrying amount of assets and liabilities for financial
    statement purposes and the income tax bases of such assets and
    liabilities. We base the measurement of deferred tax assets and
    liabilities on enacted tax rates that we expect will apply to
    taxable income in the year we expect to settle or recover those
    temporary differences. We recognize the effect on deferred
    income tax assets and liabilities of any change in income tax
    rates in the period that includes the enactment date. We provide
    a valuation allowance for deferred tax assets if, based upon the
    available evidence, it is more likely than not that some or all
    of the deferred tax assets will not be realized.
As of December 31, 2008 and in all prior periods, a
    valuation allowance was provided for all of our net deferred tax
    assets. As a result of our improved operations, in the second
    quarter of 2009 we
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determined that it was no longer necessary to maintain a
    valuation allowance for all of our deferred tax assets.
The primary sources of our deferred taxes are:
•
differences in timing of depreciation on fixed assets;
•
the timing of revenue recognition arising from incentive
    payments;
•
employee compensation costs arising from stock options;
•
costs associated with the issuance of warrants to purchase
    shares of our common stock; and
•
the existence of net operating loss carryforwards.
Beginning January 1, 2008, with the adoption of FASB
    Interpretation No. 48,
Accounting for Uncertainty in
    Income Taxes
, or FIN 48, we recognize the financial
    statement effects of a tax position only when it is more likely
    than not that the position will be sustained upon examination.
    Tax positions taken or expected to be taken that are not
    recognized under the pronouncement are recorded as liabilities.
    For interest and penalties relating to income taxes, we
    recognize accrued interest in income tax expense and penalties
    in our income tax provision in the statements of consolidated
    operations.
Share-Based
    Compensation Expense
Our share-based compensation expense results from issuances of
    shares of restricted common stock and grants of stock options
    and warrants to employees, directors, outside consultants,
    customers, vendors and others. We recognize the costs associated
    with option and warrant grants using the fair value recognition
    provisions of Statement of Financial Accounting Standards
    No. 123(R),
Share-Based Payment
, which we refer to
    as SFAS 123(R). Generally, SFAS 123(R) requires the
    value of all share-based payments to be recognized in the
    statement of operations based on their estimated fair value at
    date of grant amortized over the grant's vesting period.
Restricted Stock Plan.
Our restricted
    stock plan was adopted by our board of directors in March 2004
    and amended in June 2004. As of June 30, 2009, there were
    6,599,591 shares of common stock outstanding under our
    restricted stock plan, all of which were vested. We have made
    the following grants to employees, directors and consultants
    under the restricted stock plan:
•
In March 2004, we issued shares of common stock to our chief
    executive officer. The shares vested in 48 monthly
    installments beginning in November 2003. As a result, we
    recorded share-based compensation expense of $19,200 in each of
    2006 and 2007.
•
In June 2004, we issued shares of common stock to certain
    employees and directors. In January 2005, we issued additional
    shares of common stock to a member of our board of directors.
    These shares vested on various schedules ranging from immediate
    vesting to vesting over a period of 48 months. As a result,
    we recorded share-based compensation expense of $30,896,
    $18,530, $2,328 and $2,328 in 2006, 2007 and 2008 and the six
    months ended June 30, 2008, respectively.
Ascension Health Stock and Warrants.
In
    October 2004, Ascension Health became our founding customer.
    Since then, in exchange for its initial
start-up
assistance and subsequent sales and marketing assistance, we
    have issued common stock and granted warrants to Ascension
    Health, as described below:
•
Initial Stock Issuance and Protection Warrant
    Agreement
.  In October and November 2004, we
    issued 902,374 shares of common stock to Ascension Health,
    then representing a 5% ownership interest in our company on a
    fully-diluted basis, and entered into a protection warrant
    agreement under which Ascension Health is granted the right to
    purchase additional shares of common stock from time to time for
    $0.01 per share when Ascension Health's ownership interest
    in our company declines below 5% due to our issuance of
    additional stock
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or rights to purchase stock. The protection warrant agreement,
    and all purchase rights granted thereunder, expire on the
    closing of this offering. We made the initial stock grant and
    entered into the protection warrant agreement because Ascension
    Health agreed to provide us with an operational laboratory and
    related
start-up
consulting services in connection with our development of our
    initial revenue cycle management service offering.
In 2006, 2007 and 2008 and the six months ended June 30,
    2008 and 2009, we granted Ascension Health the right to purchase
    15,752, 58,175, 23,261, 19,358 and 25,837 shares of common
    stock for $0.01 per share, respectively, pursuant to the
    protection warrant agreement. We accounted for the costs
    associated with these purchase rights as a reduction in base fee
    revenues due to us from Ascension Health because Ascension
    Health was not required to provide us with any further services
    in connection with these grants. Accordingly, we reduced the
    amount of our base fee revenues from Ascension Health by
    $82,843, $928,108, $921,445, $696,385 and $1,334,131 in 2006,
    2007 and 2008 and the six months ended June 30, 2008 and
    2009, respectively. For additional information regarding our
    relationship with Ascension Health, see "Related Person
    Transactions — Transactions With Ascension
    Health".
•
Supplemental Warrant.
Pursuant to a
    supplemental warrant agreement that became effective in November
    2004, Ascension Health had the right to purchase up to
    902,374 shares of our common stock based upon the
    achievement of specified milestones relating to its sales and
    marketing assistance. In May 2007, we amended and restated our
    supplemental warrant agreement with Ascension Health. This
    agreement gives Ascension Health the right to purchase up to
    446,190 shares of common stock upon the achievement of
    specified milestones relating to its sales and marketing
    assistance. The purchase price for these shares is equal to the
    most recent price per share paid for our common stock in a
    capital raising transaction or, if we have not had a capital
    raising transaction within the preceding six months, the
    exercise price of the employee stock options we have most
    recently granted. The supplemental warrant agreement, and all
    purchase rights thereunder, expire on the closing of this
    offering. Concurrently with the amendment and restatement of the
    supplemental warrant agreement, in May 2007, we sold
    669,284 shares of our common stock to Ascension Health for
    $8.20 per share for an aggregate purchase price of $5,488,128.
    No share-based compensation expense was recorded in connection
    with this sale because the shares were issued at a purchase
    price equal to the fair market value of the common stock at that
    time and Ascension Health was not required to provide any
    services in connection with the issuance.
We recorded the costs associated with the purchase rights under
    the supplemental warrant agreement as marketing expense for the
    periods in which the purchase rights were earned. During
    December 2007, Ascension Health earned the right to purchase
    223,095 shares of common stock for $17.36 per share, and we
    recorded $4,153,163 in selling, general and administrative
    expense. During March 2008, Ascension Health earned the right to
    purchase 111,548 shares of common stock for $40.17 per
    share, and we recorded $2,410,790 in marketing expense. During
    March 2009, Ascension Health earned the right to purchase
    111,547 shares of common stock for $51.05 per share, and we
    recorded $2,772,953 in marketing expense.
Licensing and Consulting Warrant.
In
    conjunction with the start of our business, in February 2004, we
    executed a term sheet with a consulting firm and its principal
    contemplating that we would grant the consulting firm a warrant,
    with an exercise price equal to the fair market value of our
    common stock upon grant, to purchase shares of our common stock
    then representing 2.5% of our equity in exchange for exclusive
    rights to certain revenue cycle methodologies, tools,
    technology, benchmarking information and other intellectual
    property, plus up to another 2.5% of our equity at the time of
    grant if the consulting firm's introduction of us to senior
    executives at prospective customers resulted in the execution of
    managed service contracts between us and such customers. In
    January 2005, we formalized the warrant grant contemplated by
    the term sheet and granted the consulting firm a warrant to
    purchase 833,334 shares of our common stock for $1.12 per
    share, representing 5% of
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our equity at that time. In 2005, we recorded $483,334 in
    selling, general and administrative expense in conjunction with
    this warrant grant. The warrant expires on the earlier of
    January 15, 2015 or a change of control of our company.
We used the modified Black-Scholes option pricing model to
    determine the estimated fair value of the above purchase rights
    at the date earned. The following table sets forth the
    significant assumptions used in the model during 2006, 2007,
    2008 and the six months ended June 30, 2009:
Year Ended December 31,
Six Months Ended
2006
2007
2008
June 30, 2009
(Unaudited)
Future dividends
—
—
—
—
Risk-free interest rate
3.9% to 5.2%
2.75% to 4.21%
3.45%
2.91%
Expected volatility
60%
50%
50%
50%
Expected life(1)
7.8 years
6.8 years
6.6 years
5.6 years
(1)
Expected life applies to Ascension Health's supplemental
    warrant only, since the other warrants were fully vested upon
    grant.
Stock Option Plan.
In December 2005,
    our board of directors approved a stock option plan, which
    provides for the grant of stock options to employees, directors
    and consultants. The plan was amended and restated in February
    2006. As of June 30, 2009, the plan permitted the issuance
    of a maximum of 3,544,862 shares of common stock and
    173,828 shares were available for grant. Under the terms of
    the plan, all options will expire if they are not exercised
    within ten years after the grant date. The majority of options
    granted vest over four years at a rate of 25% per year on each
    grant date anniversary. Options can be exercised immediately
    upon grant, but upon exercise the shares issued are subject to
    the same vesting and repurchase provisions that applied before
    exercise.
Prior to January 1, 2006, we accounted for share-based
    compensation using the intrinsic value method prescribed in
    Accounting Principles Board Opinion No. 25,
Accounting
    for Stock Issued to Employees
, and related interpretations,
    as permitted by Statement of Financial Accounting Standards
    No. 123,
Accounting for Stock-Based Compensation
,
    which we refer to as SFAS 123. Accordingly, compensation
    expense for stock options was measured as the excess, if any, of
    the fair market value of our common stock at the measurement
    date (the date of grant for stock options) over the exercise
    price. Since we only granted employee stock options with an
    exercise price equal to fair market value on the date of grant,
    we did not record any compensation expense for stock option
    grants prior to January 1, 2006.
Effective January 1, 2006, we adopted the fair value
    recognition provisions of SFAS 123(R) using the modified
    prospective transition method. Under this method:
•
compensation expense for share-based awards granted prior to
    January 1, 2006 is recognized over the remaining service
    period based on the grant date fair value estimated in
    accordance with the original provisions of
    SFAS 123; and
•
compensation expense for all share-based awards granted
    subsequent to December 31, 2005 is recognized over the
    service period based on the grant date fair value estimated in
    accordance with the provisions of SFAS 123(R).
We use the modified Black-Scholes option pricing model to
    determine the estimated fair value of each option as of its
    grant date. These inputs are subjective and generally require
    significant analysis
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and judgment to develop. The following table sets forth the
    significant assumptions used in the model during 2006, 2007,
    2008 and the six months ended June 30, 2009:
Year Ended December 31,
Six Months Ended
2006
2007
2008
June 30, 2009
(Unaudited)
Future dividends
—
—
—
Forfeitures
1.88% annually
7.5% annually
3.75% annually
3.75% annually
Risk-free interest rate
3.9% to 5.2%
2.3% to 5.5%
2.8 to 4.0%
1.6% to 2.4%
Expected volatility
60%
50%
50%
50%
Expected life
6.25 years
6.25 years
6.25 years
6.25 years
Since our stock is not actively traded, we estimated its
    expected volatility by reviewing the historical volatility of
    the common stock of public companies that operate in similar
    industries or are similar in terms of stage of development or
    size and then projecting this information toward our future
    expected results. We used judgment in selecting these companies,
    as well as in evaluating the available historical and implied
    volatility for these companies.
We aggregate all employees into one pool for valuation purposes.
    The risk-free rate is based on the U.S. treasury yield
    curve in effect at the time of grant.
The plan has not been in existence a sufficient period for us to
    use our historical experience to estimate expected life.
    Furthermore, data from other companies is not readily available.
    Therefore, we have estimated our stock options' expected
    life using a simplified method based on the average of each
    option's vesting term and original contractual term. This
    methodology is set forth in Staff Accounting
    Bulletin No. 107 and its use is permitted by Staff
    Accounting Bulletin No. 110.
The estimated forfeiture rate is derived from our historical
    data and our estimates of the likely future actions of option
    holders.
We will continue to use judgment in evaluating the expected
    term, volatility and forfeiture rate related to our own
    share-based compensation on a prospective basis, and
    incorporating these factors into the Black-Scholes pricing
    model. Higher volatility and longer expected lives result in an
    increase to share based compensation expense determined at the
    date of grant. In addition, any changes in the estimated
    forfeiture rate can have a significant effect on reported
    share-based compensation expense, as the cumulative effect of
    adjusting the rate for all expense amortization is recognized in
    the period that the forfeiture estimate is changed. If a revised
    forfeiture rate is higher than the previously estimated
    forfeiture rate, an adjustment is made that will result in a
    decrease to the share-based compensation expense recognized in
    our consolidated financial statements. If a revised forfeiture
    rate is lower than the previously estimated forfeiture rate, an
    adjustment is made that will result in an increase to the share
    based compensation expense recognized in our consolidated
    financial statements. These adjustments will affect our infused
    management and technology expenses and selling, general and
    administrative expenses.
As of June 30, 2009, we had $18.1 million of total
    unrecognized share-based compensation cost related to employee
    stock options. We expect to recognize this cost over a
    weighted-average period of 3.1 years after July 1,
    2009. The allocation of this cost between selling, general and
    administrative expenses and infused management and technology
    expenses will depend on the salaries and work assignments of the
    personnel holding these stock options.
Determination of Fair Value.
Valuing
    the share price of a privately-held company is complex. We
    believe that we have used reasonable methodologies, approaches
    and assumptions in assessing and determining the fair value of
    our common stock for financial reporting purposes.
We determine the fair value of our common stock through periodic
    internal valuations that are approved by our board of directors.
    The fair value approved by our board is used for all option
    grants until such time as a new determination of fair value is
    made. To date, and as permitted by our stock
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option plan, our chief executive officer has selected option
    recipients and determined the number of shares covered by, and
    the timing of, option grants.
Our board considers the following factors when determining the
    fair value of our common stock:
•
our financial condition, sales levels and results of operations
    during the relevant period;
•
developments in our business;
•
hiring of key personnel;
•
forecasts of our financial results and market conditions
    affecting our industry;
•
market values, sales levels and results of operations for public
    companies that we consider comparable in terms of size, service
    offerings and maturity;
•
the superior rights and preferences of outstanding securities
    that were senior to our common stock; and
•
the illiquid nature of our common stock.
From June 2005 to January 2008, we used the market approach to
    estimate our enterprise value. The market approach estimates the
    fair market value of a company by applying market multiples of
    publicly-traded firms in the same or similar lines of business
    to the results and projected results of the company being
    valued. When choosing companies for use in the market approach,
    we focused on businesses that provide outsourcing, consulting or
    technology services or that have high rates of growth. To obtain
    our preliminary enterprise value, we calculated the multiple of
    the market valuations of the comparable companies to their
    annual revenues and applied this multiple to our revenue run
    rate, defined as our total projected revenues for the next
    12 months from existing customers. We then discounted the
    preliminary enterprise value by a percentage determined by our
    board to reflect our company's relative immaturity in
    relation to the comparable companies. This discount changed over
    time as we matured. The resulting value was then divided by the
    number of shares of common stock outstanding on a fully-diluted
    basis to obtain the fair value per share of common stock. We
    performed a new valuation in this manner each time we signed a
    managed service contract with a new customer.
For all valuations since January 2008, we used both the market
    approach and the income approach to estimate our aggregate
    enterprise value at each valuation date. The change in valuation
    method was in recognition that in 2007 we had achieved some
    significant milestones, particularly positive net income and
    positive adjusted EBITDA for the year, and that an initial
    public offering or other type of liquidity event would
    eventually be considered. When choosing companies to be used for
    the market approach since January 2008, we focused on businesses
    with high rates of growth and relatively low profitability that
    provide services to hospitals or other medical providers, or
    that provide business outsourcing solutions. The comparable
    companies have remained largely unchanged since January 2008.
    The income approach involves applying an appropriate
    risk-adjusted discount rate to projected debt-free cash flows,
    based on forecasted revenue and costs. The financial forecasts
    were based on assumed revenue growth rates that took into
    account our past experience and future expectations. We assessed
    the risks associated with achieving these forecasts and applied
    an appropriate cost of capital rate based on our board's
    view of our company's stage of development and risks, the
    experience of our directors in managing companies backed by
    private equity investors, and our management's review of
    academic research on this topic.
We averaged the two values derived under the market approach and
    the income approach and then added our current cash position and
    cash and tax benefits, assuming that all outstanding options and
    warrants were exercised, to create an enterprise value. Next, we
    allocated the enterprise value to our securities with rights and
    preferences that are superior to our common stock, using the
    option-pricing method set forth in the American Institute of
    Certified Public Accountants Practice Aid,
Valuation of
    Privately-Held-Company Equity Securities Issued as
    Compensation
. We then discounted
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the remaining value by 10% to reflect the fact that our
    stockholders could not freely trade our common stock in the
    public markets. We based the 10% discount for lack of
    marketability primarily on the results of a study of this topic
    by Bajaj, Denis, Ferris and Sarin entitled "Firm Value and
    Marketability Discounts" (February 26, 2001). The
    resulting value was then divided by the number of shares of
    common stock outstanding on a fully-diluted basis to obtain the
    fair value per share of common stock.
Prior to this offering, stock options and certain warrants
    represented the right to purchase shares of our non-voting
    common stock. Upon the closing of this offering, all outstanding
    non-voting common stock will convert into voting common stock on
    a share-for-share basis, and thereafter stock options and
    warrants to purchase non-voting common stock will be stock
    options and warrants to purchase voting common stock, with no
    other changes in their terms. For all valuations prior to
    May 19, 2009, we determined the fair value of the voting
    common stock and applied it to the non-voting common stock
    without a discount.
Beginning on May 19, 2009, we refined our valuation
    methodology because of the increased potential for an initial
    public offering or company sale. We continued to use both the
    market approach and the income approach, but applied a discount
    to the fair value of the non-voting common stock and modified
    other variables as described below.
There is inherent uncertainty in these forecasts and
    projections. If we had made different assumptions and estimates
    than those described above, the amount of our share-based
    compensation expense, net income or loss and related per-share
    amounts could have been materially different.
Information regarding share-based compensation from
    January 1, 2008 through June 30, 2009 is summarized in
    the table below:
Number of Shares of Common Stock
Grant Period
Subject to Option and Warrant
    Grants
January 1, 2008 to January 31, 2008
52,105
February 1, 2008 to June 9, 2008
258,634
June 10, 2008 to September 2, 2008
98,250
September 3, 2008 to October 2, 2008
17,500
October 3, 2008 to January 16, 2009
79,000
January 17, 2009 to May 18, 2009
259,000
May 19, 2009 to June 30, 2009
89,500
The analyses undertaken in determining the fair value of our
    common stock for all grants between January 1, 2008 and
    June 30, 2009 are summarized below. The methodology for the
    fair value determination made on September 4, 2007 is
    summarized above. All analyses since then used the market
    approach and the income approach summarized above, with the
    additional assumptions described below.
•
September 4, 2007 Fair Value
    Determination.
For grants made between
    January 1, 2008 and January 31, 2008, we used $17.36
    per share as the fair value of our common stock, based on a
    determination of fair value made by our board of directors on
    September 4, 2007. The market approach resulted in a value
    that was 1.5 times our annual revenue run rate as of the
    valuation date.
•
February 1, 2008 Fair Value
    Determination.
On February 1, 2008, our
    board of directors determined that the fair value of our common
    stock was $40.17 per share. The market approach resulted in a
    value that was approximately 3.53 times our net services revenue
    for the third quarter of 2007. For the income approach, we
    forecasted our cash flows over a five-year period and assumed
    that our terminal value would approximate 12.5 times our
    adjusted EBITDA for the fifth future year. We obtained the
    present value of each year's cash flow by applying a 25%
    discount rate. Next, we averaged the values resulting from the
    income
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approach and the market approach and added our cash on hand at
    December 31, 2007 and the estimated cash and tax benefits
    that would occur assuming that all outstanding options and
    warrants were exercised. The resulting value represented our
    estimate of our enterprise value. We allocated 48.9% of the
    estimated enterprise value to securities with rights and
    preferences that are superior to our common stock, assuming a
    future volatility rate of 54.25% and that a liquidity event
    would occur in 18 months. We then reduced the remaining
    value attributable to common stock by 10% for non-marketability,
    and divided the result by the number of shares outstanding on a
    fully-diluted basis to arrive at the estimated fair value per
    share.
•
June 10, 2008 Fair Value
    Determination.
On June 10, 2008, our
    board of directors determined that the fair value of our common
    stock was $47.19 per share. The increase in our value per share
    was due to increases in our estimated enterprise value under
    both the market approach and the income approach. We continued
    to apply a 50% weighting to each value and then to increase the
    result by the amount of our cash on hand and the anticipated
    cash and tax benefits from option and warrant exercises. The
    value determined by the market approach on June 10, 2008,
    which was approximately 3.52 times our net services revenue for
    the first quarter of 2008, was higher than the value determined
    on February 1, 2008 because of the increase in our net
    services revenue in the first quarter of 2008 as compared to the
    third quarter of 2007. For the income approach, we used the same
    discount rate and methodology as in the February 1, 2008
    valuation and updated our cash flow projections to reflect our
    new five-year plan. The percentage allocation of our estimated
    enterprise value to senior securities and common stock was
    unchanged from the prior valuation.
•
September 3, 2008 Fair Value
    Determination.
On September 3, 2008, our
    board of directors determined that the fair value of our common
    stock was $58.65 per share. The increase in our value per share
    was due to increases in our estimated enterprise value under
    both the market approach and the income approach. We continued
    to apply a 50% weighting to each value and then to increase the
    result by the amount of our cash on hand and the anticipated
    cash and tax benefits from option and warrant exercises. The
    value determined by the market approach on September 3,
    2008 was higher than the value determined on June 10, 2008
    because of the increase in our net services revenue in the
    second quarter of 2008 as compared to the first quarter of 2008
    and because we increased the net services revenue multiple from
    3.52 to 3.78 to reflect increases in market prices of the
    comparable companies. For the income approach, we used the same
    discount rate and methodology as in the June 10, 2008
    valuation, except that we discounted the projected cash flows
    and terminal value for three fewer months. The percentage
    allocation of our estimated enterprise value to senior
    securities and common stock was unchanged from the prior
    valuation.
•
October 3, 2008 Fair Value
    Determination.
On October 3, 2008, our
    board of directors determined that the fair value of our common
    stock was $55.77 per share. There were no changes in the
    estimated enterprise value determined under the income approach.
    The board believed, however, that the significant decline in the
    market values of publicly traded securities that occurred during
    the month of September 2008 warranted a reduction in the net
    services revenue multiple from 3.78 to 3.40, resulting in a
    decrease in our estimated enterprise value under the market
    approach. All other aspects of the valuation methodology
    remained unchanged from the September 3, 2008 valuation.
•
January 17, 2009 Fair Value
    Determination.
On January 17, 2009, our
    board of directors determined that the fair value of our common
    stock was $51.05 per share. The decrease in our value per share
    was primarily due to a decrease in our estimated enterprise
    value under the market approach. We continued to apply a 50%
    weighting to the estimated enterprise value determined under
    both the market approach and the income approach, and then to
    increase the result by the amount of our cash on hand and the
    anticipated cash and tax benefits from option and warrant
    exercises. The value determined by the market approach on
    January 17,
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2009 was lower than the value determined on October 3,
    2008, because we decreased the net services revenue multiple
    from 3.40 to 2.79 to reflect further declines in market prices
    of the comparable companies and our revenues decreased slightly
    in the third quarter of 2008 as compared to the second quarter
    of 2008. For the income approach, we used the same discount rate
    and methodology as in the October 3, 2008 valuation, except
    that we discounted the projected cash flows and terminal value
    for three fewer months. The percentage allocation of our
    estimated enterprise value to senior securities and common stock
    was unchanged from the prior valuation.
•
May 19, 2009 Fair Value
    Determination.
On May 19, 2009, our
    board of directors determined that the fair value of our
    non-voting common stock was $50.89 per share. For the income
    approach, we developed new forecasts of our cash flows over a
    ten-year period rather than a five-year period. We based our
    projections for the first five years of this period based on our
    actual operating results for 2008 and our expected operating
    results for the years 2009 through 2013, and we assumed for the
    next five years of this period that we had made an orderly
    transition from a high-growth company to a mature growth
    company. To reflect that we were entering into a different stage
    of development, we decreased the discount rate applied to future
    expected cash flows from 25% to 18%. To estimate the terminal
    value in the tenth year we assumed a 5% long-term growth rate
    after the tenth year and used the Gordon growth model, which is
    a mathematical simplification of an earnings stream that is
    expected to grow at a constant rate. For the market approach, we
    used a similar group of six companies. In order to reduce the
    influence of outliers, however, the net services revenue
    multiple for the companies with the highest and lowest figures
    were weighted 10% each and the net services revenue multiple for
    the other four companies were weighted 20% each. The estimated
    enterprise value calculated under the income approach was
    weighted 67% and the estimated enterprise value calculated under
    the market approach was weighted 33%. The result was then
    increased by the present value of the cash that we expected
    would be realized if all options and warrants were exercised
    plus the present value of the associated tax savings we would
    achieve. We continued to allocated the adjusted enterprise value
    to our securities with rights and preferences that are superior
    to our common stock, as in prior valuations, and continued to
    discount the remaining value by 10% to reflect the fact that our
    stockholders could not freely trade our common stock in the
    public markets. We also applied an additional discount of 2% to
    the fair value of the voting common stock in order to determine
    the fair value of the non-voting common stock.
Legal
    Proceedings
In the normal course of business, we are involved in legal
    proceedings or regulatory investigations. We evaluate the need
    for loss accruals using the requirements of Statement of
    Financial Accounting Standards No. 5,
Accounting for
    Contingencies
. When conducting this evaluation we consider
    factors such as the probability of an unfavorable outcome and
    the ability to make a reasonable estimate of the amount of loss.
    We record an estimated loss for any claim, lawsuit,
    investigation or proceeding when it is probable that a liability
    has been incurred and the amount of the loss can reasonably be
    estimated. If the reasonable estimate of a probable loss is a
    range, and no amount within the range is a better estimate, then
    we record the minimum amount in the range as our loss accrual.
    If a loss is not probable or a probable loss cannot be
    reasonably estimated, no liability is recorded.
Results of
    Operations
In evaluating our business performance, management monitors
    numerous quantitative and qualitative factors. The primary
    financial metrics we monitor are base fee revenues, incentive
    fee revenues, reductions in revenue cycle operating costs (both
    in absolute dollars and as a percentage of base fees), corporate
    level operating expenses, cash flow and adjusted EBITDA. We also
    monitor the
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amount of net patient revenue under our management. The
    principal non-financial metrics we monitor are:
•
Value —
the results we are producing for our
    customers by major value lever;
•
People —
our ability to attract, hire and
    retain a sufficient number of talented employees to staff our
    growing business; and
•
Technology —
the development and performance of
    our proprietary technology.
The following table sets forth consolidated operating results
    and other operating data for the periods indicated.
Six Months Ended
Fiscal Year Ended December 31,
June 30,
2006
2007
2008
2008
2009
(Unaudited)
(In thousands, except other operating data as indicated)
Statement of Operations Data:
Net services revenue
$
160,741
$
240,725
$
398,469
$
187,261
$
238,149
Costs of services
141,767
197,676
335,211
160,082
195,667
Operating margin
18,974
43,049
63,258
27,179
42,482
Infused management and technology expense
18,875
27,872
39,234
17,938
24,482
Selling, general and administrative expense
8,777
15,657
21,227
9,642
15,308
Total operating expenses
27,652
43,529
60,461
27,580
39,790
Income (loss) from operations
(8,678
)
(480
)
2,797
(401
)
2,692
Interest income
1,359
1,710
710
433
83
Income (loss) before provision for (benefit from) income taxes
(7,319
)
1,230
3,507
32
2,775
Provision for (benefit from) income taxes
—
456
2,264
626
(2,439
)
Net income (loss)
$
(7,319
)
$
774
$
1,243
$
(594
)
$
5,214
Operating Expense Details:
Infused management and technology expense, excluding
    depreciation and amortization expense and share-based
    compensation expense
$
17,952
$
26,375
$
35,079
$
16,626
$
21,411
Selling, general and administrative expense, excluding
    depreciation and amortization expense and share-based
    compensation expense
8,230
10,760
16,879
6,629
10,746
Depreciation and amortization expense
626
1,307
2,540
920
1,882
Share-based compensation expense(1)
844
5,087
5,963
3,405
5,751
Total operating expenses
$
27,652
$
43,529
$
60,461
$
27,580
$
39,790
Other Operating Data (unaudited):
Net patient revenue under management (at period end) (in
    billions)
$
4.1
$
6.9
$
9.1
$
8.5
$
11.9
(1)
Share-based compensation expense includes share-based
    compensation expense and warrant-related expense, exclusive of
    warrant expense of $83, $928, $921, $696 and $1,334 which was
    classified as a reduction in base fee revenue for the years
    ended December 31, 2006, 2007 and 2008 and the six months
    ended June 30, 2008 and 2009, respectively.
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Six Months
    Ended June 30, 2008 Compared to Six Months Ended
    June 30, 2009
Net Services
    Revenue
The following table summarizes the composition of our net
    services revenue for the six months ended June 30, 2008 and
    2009:
Six Months
Six Months
Ended June 30,
Ended June 30,
2008
2009
(In thousands)
Net base fees for managed service contracts
$
167,085
$
205,017
Incentive payments for managed service contracts
16,483
27,018
Other services
3,693
6,114
Total
$
187,261
$
238,149
Net services revenue increased $50.8 million, or 27.2%, to
    $238.1 million for the six months ended June 30, 2009
    from $187.3 million for the six months ended June 30,
    2008. The largest component of the increase, net base fee
    revenue, increased $37.9 million, or 22.7%, to
    $205.0 million for the six months ended June 30, 2009
    from $167.1 million for the six months ended June 30,
    2008, primarily due to an increase in the number of hospitals
    with whom we had managed service contracts from 43 as of
    June 30, 2008 to 53 as of June 30, 2009. Of the
    $37.9 million increase in net base fee revenues,
    $33.0 million was attributable to new managed service
    contracts entered into during the six months ended June 30,
    2009. In addition, incentive payment revenues increased by 63.9%
    to $27.0 million for the six months ended June 30,
    2009 from $16.5 million for the six months ended
    June 30, 2008, consistent with the increases that generally
    occur as our managed service contracts mature. All other
    revenues increased by $2.4 million to $6.1 million for
    the six months ended June 30, 2009 from $3.7 million
    for the six months ended June 30, 2008, as we increased the
    number of customers using our dormant patient accounts
    receivable collection services and continued to expand our
    specialized services such as emergency room physician advisory
    services. Net patient revenue under our management increased by
    40.0% to $11.9 billion for the six months ended
    June 30, 2009 from $8.5 billion for the six months
    ended June 30, 2008.
Costs of
    Services
Our costs of services increased $35.6 million, or 22.2%, to
    $195.7 million for the six months ended June 30, 2009
    from $160.1 million for the six months ended June 30,
    2008. The increase in costs of services was primarily
    attributable to the increase in the number of hospitals for
    which we provide managed services.
Operating
    Margin
Operating margin increased $15.3 million, or 56.3%, to
    $42.5 million for the six months ended June 30, 2009
    from $27.2 million for the six months ended June 30,
    2008. The increase consisted primarily of:
•
$10.5 million in additional incentive payments under
    managed service contracts;
•
an increase of $2.0 million in services margin; and
•
a reduction of $3.4 million in revenue cycle operating
    costs under managed service contracts, net of customer cost
    sharing.
The above was partially offset by an increase of
    $0.6 million in costs related to the issuance of warrants
    to Ascension Health during the six months ended June 30,
    2009.
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The increase in operating margin in absolute dollars was
    accompanied by an increase in operating margin as a percentage
    of net services revenue from 14.5% for the six months ended
    June 30, 2008 to 17.8% for the six months ended
    June 30, 2009.
Operating
    Expenses
Infused management and technology expenses increased
    $6.5 million, or 36.5%, to $24.5 million for the six
    months ended June 30, 2009 from $17.9 million for the
    six month ended June 30, 2008. The increase in infused
    management and technology expenses was primarily due to the
    increase in the number of our management personnel deployed at
    customer facilities, reflecting an increase in the number of
    hospitals with whom we had managed service contracts, as well as
    the items noted below.
Selling, general and administrative expenses increased
    $5.7 million, or 58.8%, to $15.3 million for the six
    months ended June 30, 2009 from $9.6 million for the
    six months ended June 30, 2008. The increase included
    $1.7 million of costs, or 29.9% of the increase, for
    enhancing our accounting systems, documenting internal controls,
    establishing an internal audit function and other costs
    associated with our preparation to be a public company. The
    increase also included additional research and development costs
    of $1.5 million, or 26.3% of the increase, to develop our
    new cost and quality initiative. The increase also included
    $1.5 million, or 26.3%, related to additional depreciation,
    amortization and share-based compensation expenses, as discussed
    below. The remaining increase of $1.0 million, or 17.5%,
    was primarily due to increases in our personnel costs to support
    our expanding customer base.
We allocate our operating expenses between the infused
    management expenses and selling, general and administrative
    expenses. During the six months ended June 30, 2009, the
    following changes affected both categories:
•
Share-based compensation expense increased to $5.8 million
    for the six months ended June 30, 2009 from
    $3.4 million for the six months ended June 30, 2008
    due to employee option grants and vesting of previously granted
    stock options.
•
Depreciation expense increased $0.3 million, or 50.0%, to
    $0.9 million for the six months ended June 30, 2009
    from $0.6 million for the six months ended June 30,
    2008, due to the addition of computer equipment, furniture and
    fixtures, and other property to support our growing operations.
•
Amortization expense increased $0.6 million, or 200.0%, to
    $0.9 million for the six months ended June 30, 2009
    from $0.3 million for the six months ended June 30,
    2008. The majority of this increase resulted from amortization
    of internally developed software.
Operating
    Income (Loss)
Operating income increased $3.1 million to
    $2.7 million for the six months ended June 30, 2009
    from an operating loss of $0.4 million for the six months
    ended June 30, 2008. The increase in operating income was
    primarily due to net services revenue growing at a higher rate
    than operating expenses as a result of operating efficiencies.
Income
    Taxes
The tax benefit of $2.4 million for the six months ended
    June 30, 2009 reflected the reduction of the valuation
    allowance related to deferred tax assets of $3.5 million,
    net of a provision for income taxes in the period.
Net
    Income
Net income increased $5.8 million to $5.2 million for
    the six months ended June 30, 2009 from a net loss of
    $0.6 million for the six months ended June 30, 2008.
    The increase in net income was primarily due to the increase in
    operating income, offset by a decrease of $0.4 million in
    interest income.
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Year Ended
    December 31, 2007 Compared to Year Ended December 31,
    2008
Net Services
    Revenue
The following table summarizes the composition of our net
    services revenue for the years ended December 31, 2007 and
    2008:
2007
2008
(In thousands)
Net base fees for managed service contracts
$
212,086
$
350,085
Incentive payments for managed service contracts
25,491
38,971
Other services
3,148
9,413
Total
$
240,725
$
398,469
Net services revenue increased $157.8 million, or 65.5%, to
    $398.5 million for the year ended December 31, 2008
    from $240.7 million for the year ended December 31,
    2007. The largest component of the increase, net base fee
    revenue, increased $138.0 million, or 65.1%, to
    $350.1 million for the year ended December 31, 2008
    from $212.1 million for the year ended December 31,
    2007, primarily due to an increase in the number of hospitals
    with whom we had managed service contracts from 36 as of
    December 31, 2007 to 47 as of December 31, 2008. Of
    the $138.0 million increase in net base fee revenues,
    $113.4 million was attributable to new managed service
    contracts entered into during 2008. In addition, incentive
    payment revenues increased to $39.0 million for the year
    ended December 31, 2008 from $25.5 million for the
    year ended December 31, 2007. All other revenues increased
    by $6.3 million to $9.4 million for the year ended
    December 31, 2008 from $3.1 million for the year ended
    December 31, 2007, as we increased the number of customers
    using our dormant patient accounts receivable collection
    services and we began rolling out specialized services such as
    emergency room physician advisory services. Net patient revenue
    under our management increased by 31.9% to $9.1 billion for
    the year ended December 31, 2008 from $6.9 billion for
    the year ended December 31, 2007.
Costs of
    Services
Our costs of services increased $137.5 million, or 69.6%,
    to $335.2 million for the year ended December 31, 2008
    from $197.7 million for the year ended December 31,
    2007. The increase in costs of services was primarily
    attributable to the increase in the number of hospitals for
    which we provide managed services.
Operating
    Margin
Operating margin increased $20.2 million, or 46.9%, to
    $63.3 million for the year ended December 31, 2008
    from $43.0 million for the year ended December 31,
    2007. The increase consisted primarily of:
•
$13.5 million in additional incentive payments under
    managed service contracts;
•
an increase of $3.2 million in services margin; and
•
a reduction of $3.5 million in revenue cycle operating
    costs under managed service contracts, net of customer cost
    sharing.
Operating margin as a percentage of net services revenue
    decreased in the year ended December 31, 2008 because, as a
    result of our significant growth during 2008, there was a higher
    proportion of managed service contracts in their initial
    contract year — when improvements in net services
    revenue and reductions in revenue cycle operating costs are
    generally lower — during 2008 than during 2007.
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Operating margin as a percentage of net services revenue
    decreased from 17.9% in the year ended December 31, 2007 to
    15.9% in the year ended December 31, 2008.
Operating
    Expenses
Infused management and technology expenses increased
    $11.4 million, or 40.8%, to $39.2 million for the year
    ended December 31, 2008 from $27.9 million for the
    year ended December 31, 2007. The increase in infused
    management and technology expenses was primarily due to the
    increase in the number of our management personnel deployed at
    customer facilities, reflecting an increase in the number of
    hospitals with whom we had managed service contracts, as well as
    the items noted below.
Selling, general and administrative expenses increased
    $5.6 million, or 35.6%, to $21.2 million for the year
    ended December 31, 2008 from $15.7 million for the
    year ended December 31, 2007. Of the increase,
    $6.1 million was due to increases in our personnel costs
    necessary to support our expanding customer base. This was
    offset by a $1.7 million decrease in share-based
    compensation expense associated with stock warrants granted for
    assistance in obtaining new hospital customers. The remaining
    $1.2 million of the increase related to depreciation,
    amortization and share-based compensation expenses, as discussed
    below.
We allocate our operating expenses between the infused
    management expenses and selling, general and administrative
    expenses. During the year ended December 31, 2008, the
    following changes affected both categories:
•
Share-based compensation expense increased to $6.0 million
    for the year ended December 31, 2008 from $5.1 million
    for the year ended December 31, 2007, due to employee
    option grants and vesting of previously granted stock options.
•
Depreciation expense increased $0.5 million, or 100%, to
    $1.0 million for the year ended December 31, 2008 from
    $0.5 million for the year ended December 31, 2007, due
    to the addition of computer equipment, furniture and fixtures
    and other property to support our growing operations.
•
Amortization expense increased $0.7 million, or 87.5%, to
    $1.5 million for the year ended December 31, 2008 from
    $0.8 million for the year ended December 31, 2007. Of
    this increase, $0.5 million related to the amortization of
    internally developed software, $0.1 million related to the
    write-off of the value assigned to relationships with customers
    acquired as a result of our SureDecisions acquisition that did
    not enter into managed service contracts with us, and
    $0.1 million related to recurring amortization of other
    intangible assets.
Operating
    Income (Loss)
Operating income increased $3.3 million to
    $2.8 million for the year ended December 31, 2008 from
    an operating loss of $0.5 million for the year ended
    December 31, 2007. The increase in operating income was
    primarily due to net services revenue growing at a higher rate
    than operating expenses as a result of operating efficiencies.
Income
    Taxes
We conduct a large portion of our operations in Michigan. In
    2008, Michigan began to impose a tax based on gross receipts in
    addition to tax based on net income. For the year ended
    December 31, 2008, we recorded a tax provision of
    $2.3 million, of which $1.2 million was attributable
    to the Michigan gross receipts tax. As a result, our total tax
    provision was equal to 65% of pre-tax income for the year ended
    December 31, 2008, compared to 37% of pre-tax income for
    the year ended December 31, 2007.
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Net
    Income
Net income increased $0.5 million, or 60.6%, to
    $1.2 million for the year ended December 31, 2008 from
    $0.8 million for the year ended December 31, 2007. The
    increase in net income was primarily due to the increase in
    operating income.
Year Ended
    December 31, 2006 Compared to Year Ended December 31,
    2007
Net Services
    Revenue
The following table summarizes the composition of our net
    services revenue for the years ended December 31, 2006 and
    2007:
2006
2007
(In thousands)
Net base fees for managed service contracts
$
149,529
$
212,086
Incentive payments for managed service contracts
9,784
25,491
Other services
1,428
3,148
Total
$
160,741
$
240,725
Net services revenue increased $80.0 million, or 49.8%, to
    $240.7 million for the year ended December 31, 2007
    from $160.7 million for the year ended December 31,
    2006. The largest component of the increase, net base fee
    revenue, increased $62.6 million, or 41.8%, to
    $212.1 million for the year ended December 31, 2007
    from $149.5 million for the year ended December 31,
    2006, primarily due to an increase in the number of hospitals
    with whom we had managed service contracts from 21 as of
    December 31, 2006 to 36 as of December 31, 2007. Of
    the $62.6 million increase in net base fee revenues,
    $40.9 million was attributable to new managed service
    contracts entered into during 2007. In addition, incentive
    payment revenues increased to $25.5 million for the year
    ended December 31, 2007 from $9.8 million for the year
    ended December 31, 2006. All other revenues increased
    $1.7 million, or 120.4%, to $3.1 million for the year
    ended December 31, 2007 from $1.4 million for the year
    ended December 31, 2006, primarily due to an increase in
    the number of customers using our dormant patient accounts
    receivable collection services. Net patient revenue under our
    management increased by 68.3% to $6.9 billion for the year
    ended December 31, 2007 from $4.1 billion for the year
    ended December 31, 2006.
Costs of
    Services
Our costs of services increased $55.9 million, or 39.4%, to
    $197.7 million for the year ended December 31, 2007
    from $141.8 million for the year ended December 31,
    2006. The increase in costs of services was primarily
    attributable to the increase in the number of hospitals for
    which we provide managed services.
Operating
    Margin
Operating margin increased $24.1 million, or 126.9%, to
    $43.0 million for the year ended December 31, 2007
    from $19.0 million for the year ended December 31,
    2006. The increase consisted primarily of:
•
$15.7 million in additional incentive payments under
    managed service contracts; and
•
a reduction of $8.9 million in revenue cycle operating
    costs under managed service contracts, net of customer cost
    sharing.
The above increases were partially offset by an increase of
    $0.8 million in costs related to the issuance of warrants
    to Ascension Health during the year ended December 31, 2007.
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Table of Contents
In total, operating margin as a percentage of net services
    revenue increased from 11.8% in the year ended December 31,
    2006 to 17.9% in the year ended December 31, 2007,
    primarily due to an increased ratio of mature managed service
    contracts to new managed service contracts.
Operating
    Expenses
Infused management and technology expenses increased
    $9.0 million, or 47.7%, to $27.9 million for the year
    ended December 31, 2007 from $18.9 million for the
    year ended December 31, 2006. The increase in infused
    management and technology expenses was primarily due to the
    increase in the number of our management personnel deployed at
    customer facilities, reflecting an increase in the number of
    hospitals with whom we had managed service contracts.
Selling, general and administrative expenses increased
    $6.9 million, or 78.4%, to $15.7 million for the year
    ended December 31, 2007 from $8.8 million for the year
    ended December 31, 2006. Grants of stock warrants to
    Ascension Health and option grants accounted for
    $4.2 million of the increase, as noted below. The remaining
    $2.7 million of increase related to the increase in our
    personnel costs to support our expanding customer base.
We allocate our operating expenses between the infused
    management expenses and selling, general and administrative
    expenses. During the year ended December 31, 2007, the
    following changes affected both categories:
•
Share-based compensation expense increased by $4.2 million
    for the year ended December 31, 2007 from $0.8 million
    for the year ended December 31, 2006, of which
    $4.1 million was due to grants of stock warrants to
    Ascension Health and the balance was attributable to increases
    in the costs associated with employee option grants and the
    vesting of previously granted stock options.
•
Depreciation expense increased $0.2 million, or 66.7%, to
    $0.5 million for the year ended December 31, 2007 from
    $0.3 million for the year ended December 31, 2006, due
    to the addition of computer equipment, furniture and fixtures,
    and other property to support our growing operations.
•
Amortization expense increased $0.5 million, or 166.7%, to
    $0.8 million for the year ended December 31, 2007 from
    $0.3 million for the year ended December 31, 2006, due
    to the amortization of internally developed software.
Operating
    Loss
Operating loss decreased $8.2 million, or 94.5%, to
    $0.5 million for the year ended December 31, 2007 from
    $8.7 million for the year ended December 31, 2006. The
    decrease in operating loss was primarily due to net services
    revenue growing at a higher rate than costs of services and
    operating expenses as a result of operating efficiencies.
Income
    Taxes
In 2007, we had net taxable income and began recording a tax
    provision equal to 37% of pre-tax income.
Net
    Income
We had net income of $0.8 million for the year ended
    December 31, 2007 compared to a net loss of
    $7.3 million for the year ended December 31, 2006. The
    increase in net income was primarily due to the decrease in
    operating losses combined with a $0.4 million increase in
    interest income due to an increase in cash investments.
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Table of Contents
Selected
    Quarterly Financial Data
The following table sets forth selected unaudited consolidated
    quarterly operating data for each of the ten quarters during the
    period from January 1, 2007 to June 30, 2009. In our
    management's opinion, the data have been prepared on the
    same basis as the audited consolidated financial statements
    included in this prospectus and reflect all necessary
    adjustments, consisting only of normal recurring adjustments,
    necessary for a fair presentation of these data. You should read
    this information together with our consolidated financial
    statements and the related notes appearing elsewhere in this
    prospectus. Operating results for any fiscal quarter are not
    necessarily indicative of results for the full year. Historical
    results are not necessarily indicative of the results to be
    expected in future periods.
Three Months Ended
Mar. 31,
June 30,
Sept. 30,
Dec. 31,
Mar. 31,
June 30,
Sept. 30,
Dec. 31,
Mar. 31,
June 30,
2007
2007
2007
2007
2008
2008
2008
2008
2009
2009
(In thousands)
Net services revenue
$
49,699
$
56,795
$
64,611
$
69,620
$
86,357
$
100,904
$
105,956
$
105,252
$
112,467
$
125,682
Costs of services
44,431
46,688
50,765
55,792
73,433
86,649
87,624
87,505
92,703
102,964
Operating margin
5,268
10,107
13,846
13,828
12,924
14,255
18,332
17,747
19,764
22,718
Infused management and technology expenses
5,882
6,608
6,822
8,560
8,452
9,486
9,795
11,501
11,175
13,307
Selling, general and administrative expenses
2,478
2,564
3,139
7,476
5,696
3,946
5,020
6,565
8,816
6,492
Income (loss) from operations
(3,092
)
935
3,885
(2,208
)
(1,224
)
823
3,517
(319
)
(227
)
2,919
Interest income
457
393
383
477
264
169
251
26
44
39
Net income (loss) before provision for (benefit from) income
    taxes
(2,635
)
1,328
4,268
(1,731
)
(960
)
992
3,768
(293
)
(183
)
2,958
Provision for (benefit from) income taxes
(977
)
492
1,583
(642
)
26
600
1,414
224
454
(2,893
)
Net income (loss)
$
(1,658
)
$
836
$
2,685
$
(1,089
)
$
(986
)
$
392
$
2,354
$
(517
)
$
(637
)
$
5,851
Our quarterly and annual net services revenue generally
    increased each period due to ongoing expansion in the number of
    hospitals subject to managed service contracts with us and
    increases in the amount of incentive payments earned. The timing
    of customer additions is not uniform throughout the year,
    however. We did not add any new customers in the quarter ended
    December 31, 2008 and as a result our net services revenue
    were essentially unchanged from the prior quarter. We experience
    seasonal fluctuations in incentive payments as a result of
    variations in the number of days in certain months and patient
    deferral of elective procedures during the year-end holiday
    period.
Our costs of services generally increased each period due to
    increases in the number of revenue cycle staff persons under our
    management at customer sites. Our operating expenses have
    increased as a result of our hiring of additional employees to
    provide
on-site
management of our customers' revenue cycle operations and
    our ongoing efforts to develop and enhance the technology that
    allows us to improve our customers' net revenue. Operating
    margins are slightly depressed in quarters in which we add new
    customers that have not yet fully implemented our cost-reduction
    programs. In addition, beginning in the second half of 2008, we
    began to incur additional expenses to build the infrastructure
    necessary to become a public company. The ongoing decline in
    interest income for the periods presented is due to the
    reduction in market interest rates. The tax benefit in the
    quarter ended June 30, 2009 reflects the release of
    reserves for deferred tax assets of $3.6 million.
Selling, general and administrative expenses in the quarters
    ended December 31, 2007, March 31, 2008 and
    March 31, 2009 included $4.1 million,
    $2.4 million and $2.7 million, respectively, in
    share-based compensation expense associated with stock warrants
    granted for assistance in
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obtaining new hospital customers. Primarily as a result of these
    expenses, we incurred net losses in the quarters ended
    December 31, 2007 and March 31, 2008. We incurred a
    net loss in the quarter ended March 31, 2007 primarily due
    to the immaturity of our managed service contract portfolio and
    variations in the timing of quarterly incentive payments.
Liquidity and
    Capital Resources
Our primary source of liquidity is cash flows from operations.
    Given our current cash and cash equivalents, short-term
    investments and accounts receivable, we believe that we will
    have sufficient liquidity to fund our business and meet our
    contractual obligations for at least 12 months following
    the closing of this offering. We expect that the combination of
    our current liquidity and expected additional cash generated
    from operations will be sufficient for our planned capital
    expenditures, which are expected to consist primarily of
    capitalized software, and other investing activities, in the
    next 12 months.
Our cash and cash equivalents, consisting of demand deposits,
    increased $17.0 million, from $34.7 million at
    December 31, 2007 to $51.7 million at
    December 31, 2008, primarily due to cash generated by the
    growth in our business. Cash and cash equivalents decreased
    $13.9 million, from $51.7 million at December 31,
    2008 to $37.8 million at June 30, 2009, primarily due
    to the changes in accounts receivable and prepaid assets
    discussed below.
Operating
    Activities
Cash flows used by operating activities totaled
    $11.7 million for the six months ended June 30, 2009
    and cash flows generated by operating activities totaled
    $9.9 million for the six months ended June 30, 2008.
    Receivables from customers increased by $20.7 million
    during the six months ended June 30, 2009 and decreased by
    $0.9 million during the six months ended June 30,
    2008, primarily due to increased net services revenue and the
    timing of customer payments. Prepaid assets increased by
    $7.2 million during the six months ended June 30, 2009
    due to a prepayment of 2009 estimated federal income taxes.
    Payables increased by $12.7 million for the six months
    ended June 30, 2009 and by $10.6 million for the six
    months ended June 30, 2008. The change in payables was
    primarily due to timing of our payments.
Cash flows generated by operating activities totaled
    $39.5 million for the year ended December 31, 2008,
    $11.8 million for the year ended December 31, 2007 and
    $6.0 million for the year ended December 31, 2006. The
    increases in cash provided by operations for the years ended
    December 31, 2007 and 2008 was primarily attributable to
    higher net services revenue and improved financial results due
    to growth in our business. Receivables from customers increased
    by $4.3 million during the year ended December 31,
    2008 and by $15.1 million during the year ended
    December 31, 2007, in each case primarily due to increased
    net services revenue. Payables increased by $16.1 million
    during the year ended December 31, 2008 and by
    $8.3 million during the year ended December 31, 2007,
    and deferred revenue increased by $10.3 million during the
    year ended December 31, 2008 and by $6.6 million
    during the year ended December 31, 2007. The increases in
    payables and deferred revenue were primarily due to growth in
    our business.
Investing
    Activities
Cash used in investing activities was $2.4 million for the
    six months ended June 30, 2009 and $2.3 million for
    the six months ended June 30, 2008. Use of cash in these
    periods primarily related to the purchase of furniture and
    fixtures, computer hardware and software to support the growth
    of our business.
Cash flows used in investing activities was $6.1 million
    for the year ended December 31, 2008, $3.3 million for
    the year ended December 31, 2007 and $4.7 million for
    the year ended December 31, 2006. For all three years, use
    of cash primarily related to our purchase of furniture,
    fixtures, computer
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hardware, software and other property to support the growth of
    our business. In addition, we used $1.4 million in cash to
    acquire SureDecisions in May 2006.
Financing
    Activities
Cash provided by financing activities was $0.2 million for
    the six months ended June 30, 2009 and cash used by
    financing activities was $0.4 million for the six months
    ended June 30, 2008. The increase from the six months ended
    June 30, 2008 to the six months ended June 30, 2009
    was primarily attributable to the repayment of non-executive
    employee promissory notes related to stock option exercises.
Cash used by financing activities was $16.3 million for the
    year ended December 31, 2008, primarily due to our payment
    of $15.0 million of dividends and our repurchase of common
    stock for $1.5 million, partially offset by
    $0.2 million of proceeds from exercises of stock options.
    In June 2008, our board of directors approved a special dividend
    on all outstanding shares of common stock and preferred stock in
    the amount of $0.7203 per common-equivalent share, for an
    aggregate dividend of $15.0 million. The dividend was
    declared to provide an initial return on the investment of the
    company's private investors.
Cash provided by financing activities was $5.4 million for
    the year ended December 31, 2007. This represented
    $5.5 million of proceeds from our sale of
    669,284 shares of common stock to Ascension Health and an
    additional $0.6 million of proceeds from exercises of stock
    option, partially offset by our repurchases of common stock for
    $0.7 million.
Cash provided by financing activities was $2.0 million for
    the year ended December 31, 2006, reflecting
    $2.4 million of proceeds from exercises of stock options,
    partially offset by $0.4 million of loans we made to
    employees to facilitate their option exercises.
Future Capital
    Needs
We intend to fund our future growth over the next 12 months
    with funds generated from operations and our net proceeds from
    this offering. Over the longer term, we expect that cash flows
    from operations, supplemented by short-term and long-term
    financing, as necessary, will be adequate to fund our day-to-day
    operations and capital expenditure requirements. Our ability to
    secure short-term and long-term financing in the future will
    depend on several factors, including our future profitability,
    the quality of our accounts receivable, our relative levels of
    debt and equity, and the overall condition of the credit markets.
We are in the process of negotiating a $15 million
    revolving line of credit for working capital and general
    corporate purposes. If we enter into this credit facility, we
    anticipate that borrowings would be secured by substantially all
    of our assets and a cash deposit account and would be subject to
    a borrowing base. We expect the credit facility to have an
    initial term of two years, to be renewable annually and to have
    other terms and conditions customary for lines of credit of this
    type with similar companies.
Contractual
    Obligations
The following table presents our obligations and commitments to
    make future payments under contracts, such as lease agreements,
    and under contingent commitments as of December 31, 2008:
Year Ended December 31,
2013 and
2009
2010
2011
2012
beyond
Total
(In thousands)
Minimum lease payments
$
1,218
$
824
$
758
$
329
$
792
$
3,921
Total
$
1,218
$
824
$
758
$
329
$
792
$
3,921
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We rent office space and equipment under a series of operating
    leases, primarily for our Chicago corporate office and India
    operations. Lease payments are amortized to expense on a
    straight-line basis over the lease term. As of December 31,
    2008, the Chicago corporate office consisted of approximately
    28,000 square feet in a multi-story office building. We
    have an option to cancel the lease effective November 30,
    2011 if the landlord is unable, prior to December 31, 2010,
    to provide approximately 22,000 square feet of additional
    office space on an adjacent floor. If the landlord provides this
    additional office space and we do not concurrently exercise our
    option to return approximately 6,500 square feet of office
    space on a non-adjacent floor, the lease for all
    50,000 feet will be extended until ten years and
    90 days after the date we take possession of the additional
    22,000 square feet of office space, and our minimum lease
    payments will increase by approximately $550,000 per year. See
    "Business — Facilities" for additional
    information regarding our office leases.
Pursuant to the master services agreement between us and
    Ascension Health and our individual agreements with hospitals
    affiliated with Ascension Health that contract for our services,
    our fees are subject to adjustment in the event specified
    performance milestones are not met, which could result in a
    reduction in future fees payable to us by such hospitals but
    would not obligate us to refund any payments. These potential
    reductions in future fees are not reflected in the above table
    because the amounts cannot be quantified and because, based on
    our experience to date, we do not anticipate that there will be
    any permanent reduction in future fees under these provisions.
    For additional information regarding these contract provisions,
    see "Related Person Transactions — Transactions
    With Ascension Health".
Off-Balance Sheet
    Arrangements
We have not entered into any off-balance sheet arrangements.
Recent Accounting
    Pronouncements
In December 2007, the Financial Accounting Standards Board , or
    FASB, issued Statement of Financial Accounting Standards, or
    SFAS, No. 141(R),
Business Combinations
.
    SFAS No. 141(R) requires us to continue to follow the
    guidance in SFAS No. 141 for certain aspects of
    business combinations, with additional guidance provided
    defining the acquirer, recognizing and measuring the
    identifiable assets acquired, the liabilities assumed, any
    noncontrolling interest in the acquiree, assets and liabilities
    arising from contingencies, defining a bargain purchase, and
    recognizing and measuring goodwill or a gain from a bargain
    purchase. In addition, under SFAS No. 141(R),
    adjustments associated with changes in tax contingencies that
    occur after the measurement period, not to exceed one year, are
    recorded as adjustments to income. This statement is effective
    for all business combinations for which the acquisition date is
    on or after the beginning of an entity's first fiscal year
    that begins after December 15, 2008; however, the guidance
    in this standard regarding the treatment of income tax
    contingencies is retroactive to business combinations completed
    prior to January 1, 2009. We adopted
    SFAS No. 141(R) on January 1, 2009. The adoption
    had no material impact on the Company's consolidated
    financial statements.
In April 2008, the FASB issued FASB Staff Position, or FSP,
SFAS 142-3,
"Determination of the Useful Life of Intangible
    Assets
". This FSP amends the factors that should be
    considered in developing renewal or extension assumptions used
    to determine the useful life of a recognized intangible asset
    under SFAS No. 142. The intent of this FSP is to
    improve the consistency between the useful life of a recognized
    intangible asset under SFAS No. 142 and the period of
    expected cash flows used to measure the fair value of the asset
    under SFAS No. 141R and other United States generally
    accepted accounting principles. This FSP is effective for
    financial statements issued for fiscal years beginning after
    December 15, 2008, and interim periods within those fiscal
    years. The Company adopted this FSP January 1, 2009. The
    adoption of this FSP did not have an impact on our consolidated
    financial statements.
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In June 2008, the FASB issued FSP Emerging Issues Task Force, or
    EITF,
03-6-1,
"
Determining Whether Instruments Granted in Share-Based
    Payment Transactions Are Participating Securities
". FSP
EITF 03-6-1
addresses whether instruments granted in share-based payment
    transactions are participating securities prior to vesting and,
    therefore, need to be included in the earnings allocation in
    computing earnings per share under the two-class method. This
    FSP is effective for financial statements issued for fiscal
    years beginning after December 15, 2008 and interim periods
    within those years. We adopted this FSP effective
    January 1, 2009.
In April 2009, the FASB issued FSP
SFAS 107-1
and Accounting Principles Board (APB)
28-1,
"
Interim Disclosures about Fair Value of Financial
    Instruments
". This FSP, which amends
    SFAS No. 107, "
Disclosures about Fair Value of
    Financial Instruments
", requires publicly-traded
    companies, as defined in APB Opinion No. 28,
    "
Interim Financial Reporting
", to provide
    disclosures on the fair value of financial instruments in
    interim financial statements. Since FSP
SFAS 107-1
requires only additional disclosures concerning the financial
    instruments, the adoption of FSP
SFAS 107-1
effective June 30, 2009, did not have a material impact on
    our condensed consolidated financial statements.
In May 2009, the FASB issued SFAS No. 165,
    "
Subsequent Events
", or SFAS 165.
    SFAS No. 165 establishes general standards of
    accounting for and disclosures of subsequent events that occur
    after the balance sheet date but prior to the issuance of
    financial statements. The statement requires additional
    disclosure regarding the date through which subsequent events
    have been evaluated by the entity as well as whether that date
    is the date the financial statements were issued. This statement
    became effective for our financial statements as of
    June 30, 2009. We have evaluated its subsequent events
    after the balance sheet date of June 30, 2009 through
    September 24, 2009.
In June 2009, FASB issued SFAS No. 168,
"The
    FASB Accounting Standards Codification and the Hierarchy of
    Generally Accepted Accounting Principles, a replacement of FASB
    Statement No. 162
, or SFAS No. 168.
    SFAS No. 168 identifies the sources of accounting
    principles and the framework for selecting the principles to be
    used in the preparation of financial statements that are
    presented in conformity with generally accepted accounting
    principles in the United States. SFAS No. 168 is
    effective for financial statements issued for interim and annual
    periods ending after September 15, 2009. We do not expect
    the adoption of SFAS No. 168 to have a significant
    impact on our consolidated financial statements.
Qualitative and
    Quantitative Disclosures about Market Risk
Interest Rate Sensitivity.
Our interest
    income is primarily generated from interest earned on operating
    cash accounts. Our exposure to market risks related to interest
    rates is insignificant. We do not enter into interest rate
    swaps, caps or collars or other hedging instruments.
Foreign Currency Exchange Risk.
Our
    results of operations and cash flows are subject to fluctuations
    due to changes in the Indian rupee because a portion of our
    operating expenses are incurred by our subsidiary in India and
    are denominated in Indian rupees. However, we do not generate
    any revenues outside of the United States. For the year ended
    December 31, 2008 and the six months ended June 30,
    2009, 0.7% and 0.8%, respectively, of our expenses were
    denominated in Indian rupees. As a result, we believe that the
    risk of a significant impact on our operating income from
    foreign currency fluctuations is not substantial.
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BUSINESS
Overview
Accretive Health is a leading provider of healthcare revenue
    cycle management services. Our business purpose is to help
    U.S. hospitals, physicians and other healthcare providers
    manage their revenue cycle operations more efficiently. Our
    integrated, end-to-end technology and services offering, which
    we refer to as our solution, helps our customers realize
    sustainable improvements in their operating margins and improve
    the satisfaction of their patients, physicians and staff. We
    enable these improvements by helping our customers increase the
    portion of the maximum potential patient revenue they receive
    while reducing total revenue cycle costs.
Our customers typically are multi-hospital systems, including
    faith-based or community healthcare systems, academic medical
    centers and independent ambulatory clinics, and their affiliated
    physician practice groups. We seek to develop strategic,
    long-term relationships with our customers and focus on
    providers that we believe understand the value of our operating
    model and have demonstrated success in both clinical and
    operational outcomes. As of June 30, 2009, we provided our
    integrated revenue cycle service offerings to 21 customers
    representing 53 hospitals and $11.9 billion in annual
    net patient revenue, as well as physicians' billing
    organizations associated with several of these customers.
Grounded in sophisticated analytics, our solution spans our
    customers' entire revenue cycle, unlike competing services
    that address only a portion of the revenue cycle. We are not a
    traditional outsourcing company focused solely on one-time cost
    reductions. Through the implementation of our distinctive
    operating model that includes people, processes and technology,
    our customers can generate significant and sustainable revenue
    cycle improvements. Our service offerings are adaptable to
    evolution of the healthcare regulatory environment, technology
    standards and market trends, and require no up-front cash
    investment by our customers.
To implement our solution, we assume full responsibility for the
    management and cost of a customer's revenue cycle
    operations and supplement the customer's existing revenue
    cycle staff with seasoned Accretive Health personnel. We
    collaborate with our customers' revenue cycle employees
    with the objective of educating and empowering them so that over
    time they can deliver improved results using our tools. Once
    implemented, our technology, processes and services are deeply
    embedded in a hospital's day-to-day operations, touching
    each key step of the revenue cycle. We and our customers share
    financial gains resulting from our solution, which directly
    aligns our objectives and interests with those of our customers.
    Both we and our customers benefit — on a contractually
    agreed upon basis — from net patient revenue increases
    and cost savings realized by the customers as a result of our
    services. We believe that, over time, this alignment of
    interests fosters greater innovation and incentivizes us to
    improve our customers' revenue cycle operations.
The revenue cycle operations of a typical hospital, physician or
    other healthcare provider often fail to capture and collect the
    total amounts owed to it from third-party payors and patients
    for medical services rendered, leading to significant bad debt
    write-offs, uncompensated care, payor denials and corresponding
    administrative write-offs, as well as lost revenue for missed
    charges. Fitch Ratings estimates that in 2008, uncompensated
    care (including bad debt write-offs, charity care and uninsured
    discounts) averaged 17% of net patient revenue at
    U.S. hospitals. We generally deliver operating margin
    improvements to our customers through a combination of
    improvements in collections, which we refer to as net revenue
    yield, charge capture and revenue cycle cost reductions. Our
    customers have historically achieved significant net revenue
    yield improvements within 18 to 24 months of implementing
    our operating model, with customers subject to mature managed
    service contracts realizing 400 to 600 basis points in
    yield improvements, typically in the third or fourth contract
    year. Improvements in charge capture and collections are
    typically attributable to reduced payor denials, identification
    of additional items that can be billed to payors based on the
    actual procedures performed, identification of insurance for a
    higher percentage of otherwise uninsured patients, and
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improved collections of patient balances after insurance.
    Revenue cycle cost reductions are typically achieved through
    operating efficiencies, including streamlining work flow,
    automating processes, centralizing vendor activities and
    implementing other efficiencies. Specific sources of margin
    improvement vary among customers.
We have developed and refined our solution based in part on
    information, processes and management experience garnered
    through working with many of the largest and most prestigious
    hospitals and healthcare systems in the United States. We seek
    to embed our technology, personnel, know-how and culture within
    each customer's revenue cycle activities with the
    expectation that we will serve as the customer's
on-site
operational manager beyond the managed service contract's
    initial term, which typically ranges from four to five years. To
    date, we have experienced a contract renewal rate of 100%
    (excluding exploratory new service offerings, a consensual
    termination following a change of control and a customer
    reorganization). Coupled with the long-term nature of our
    managed service contracts and the fixed nature of the base fees
    under each contract, our historical renewal experience provides
    a core source of recurring revenue.
Our net services revenue consist primarily of base fees and
    incentive fees. We receive base fees for managing our
    customers' revenue cycle operations, net of any cost
    savings we share with those customers. Incentive fees represent
    our portion of the increase in our customers' net patient
    revenue resulting from our services. We generate a portion of
    our operating margin as a result of the difference between the
    fixed base fees and the variable costs of the revenue cycles
    that we manage. Incentive fees are a smaller portion of overall
    revenue than base fees but generally contribute directly to
    operating margin, thus significantly impacting our
    profitability. We closely monitor each customer's revenue
    cycle performance through periodic operating reviews. A
    customer's net revenue improvements and cost savings
    generally increase over time as we deploy additional programs
    and as the programs we implement become more effective, which in
    turn provides visibility into our future revenue and
    profitability. In 2008, for example, approximately 80% of our
    net services revenue, and over 95% of our net income, was
    derived from customer contracts that were in place as of
    January 1, 2008. In 2008, we had net services revenue of
    $398.5 million, representing growth of 65.5% over 2007 and
    a compound annual growth rate of 53.0% since 2005. In addition,
    we were profitable for the years ended December 31, 2007
    and 2008 and the six months ended June 30, 2009, and our
    profitability increased in each of these periods.
Market
    Opportunity
We believe that current macroeconomic conditions will continue
    to impose financial pressure on healthcare providers and will
    increase the importance of managing their revenue cycles
    effectively and efficiently. The market opportunity for our
    services — which we define as the total amount of net
    patient revenue collected annually by U.S. hospitals and
    physicians' billing organizations — exceeds
    $750 billion, calculated as follows. There are more than
    2,200 acute care hospitals in the United States within our
    target market (with more than $250 million in annual net
    patient revenue each, or part of larger hospital systems),
    representing a market opportunity of approximately
    $510 billion in annual net patient revenue. In addition,
    there are more than 2,500 smaller hospitals (with less than
    $250 million in annual net patient revenue each),
    representing a market opportunity of approximately
    $130 billion in annual net patient revenue, and large
    physicians' billing organizations (with at least 75
    physicians each), representing an additional market opportunity
    of approximately $115 billion in annual net patient revenue.
According to the Centers for Medicare and Medicaid Services of
    the U.S. Department of Health and Human Services,
    expenditures for hospitals and physician and clinical services
    are expected to increase between 2009 and 2018 at annual rates
    of approximately 6.4% and 5.4%, respectively. Population growth,
    longer life expectancy, the increasing prevalence of chronic
    illnesses (such as diabetes and obesity) and the
    over-utilization of certain healthcare services is expected to
    put increasing pressure on hospitals, physicians and other
    healthcare providers to operate more efficiently. American
    Hospital Association surveys indicate that approximately 43% of
    hospitals had a
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negative operating margin during the first quarter of 2009 and
    approximately 77% of hospitals are reducing capital spending. As
    the scope of healthcare services expands and financial pressures
    mount, hospitals are demanding both greater effectiveness and
    improved efficiency in the management of their revenue cycle
    operations. We believe that efficient management of the revenue
    cycle and collection of the full amount of payments due for
    patient services are among the most critical challenges facing
    healthcare providers today.
We believe that the inability of healthcare providers to capture
    and collect the total amounts owed to them for patient services
    is caused by the following trends:
•
Complexity of Revenue Cycle
    Management.
At most hospitals, there is a
    lack of standardization across operating practices, payor and
    patient payment methodologies, data management processes and
    billing systems. In general, after a patient receives healthcare
    services, the hospital must coordinate payment with two or more
    parties, including third-party insurance companies, federal and
    state government payors, private charities and individual
    payors. Hospitals also face a growing population of uninsured
    patients, whom healthcare providers have an ethical and legal
    obligation to treat.
•
Lack of Integrated Systems and
    Processes.
Although interrelated, the
    individual steps in the revenue cycle continuum are not
    operationally integrated across revenue cycle departments at
    many hospitals. Multiple tasks and milestones must be completed
    properly by personnel in various departments before a hospital
    or physician can be reimbursed for patient services. It is often
    difficult for a single organization to acquire and coordinate
    all the knowledge and experience necessary to capture
    inefficiencies within the revenue cycle. Even if all steps are
    performed flawlessly, the time required to receive full payment
    for services creates long billing cycles. With frequent changes
    in the reimbursement rules imposed by third-party payors, the
    billing and collections cycle often is not timely and
    error-free, further lengthening the time before payment is
    actually received by the healthcare provider.
•
Increasing Patient Financial Responsibility for Healthcare
    Services.
Hospitals are being forced to adapt
    to the need for direct-to-patient billing and collections
    capabilities as patients bear payment responsibility for an
    increasing portion of healthcare costs. Hospitals have
    traditionally focused on collecting payments from insurance
    companies and from state and federal payors, and typically are
    less familiar with the processes necessary to collect payments
    from patients at the point of service, including the use of
    alternative payment options. Patient billing is often confusing
    and payment instructions are often unclear. Moreover, hospitals
    generally do not utilize consumer segmentation techniques to
    formulate effective revenue collection approaches to patients.
    As a result, hospitals generally write-off a high percentage of
    patient-owed bills, resulting in increases in bad debt and
    uncompensated care.
•
Outdated Systems and Insufficient Resources to Upgrade
    Them.
Many hospitals suffer from operating
    inefficiencies caused by outdated technology, increasingly
    complex billing requirements, a general lack of standardization
    of process and information flow, costly in-house services that
    could be more economically outsourced, and an increasingly
    stringent regulatory environment. Hospitals often lack the
    breadth and depth of data available to payors, and this lack of
    information may contribute to the filing of less accurate claims
    with third-party insurance payors and unfavorable resolutions of
    disputed claims. In addition, the endowments of most hospitals
    have significantly declined, motivating them to make their
    revenue cycle operations more efficient.
National healthcare reform is currently a major policy issue at
    the federal level. The Obama administration has made healthcare
    reform a priority, and several legislative proposals are
    currently being debated by Congress. Some of the underlying
    themes of current reform proposals are broadly targeted to
    driving greater efficiency in the U.S. healthcare system
    by, among other things, rewarding quality and coordination of
    care and promoting broader adoption of electronic medical
    records. Although it is impossible to predict what healthcare
    reform legislation, if any, will be enacted, we believe
    healthcare reform could create new business opportunities for us
    by increasing the need for
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services such as those that we provide. For example, as a result
    of more complex reimbursement models and reduced fee-for-service
    reimbursement, healthcare providers may turn to outsourcing to
    extract more out of their existing revenue cycles. The increased
    attention to quality measures and risk/reward reimbursement
    models under some reform proposals could also create more
    interest in our service offerings.
The Accretive
    Health Solution
Our solution is intended to address the full spectrum of revenue
    cycle operational issues faced by healthcare providers,
    including:
•
the increasingly complex and challenging payor environment;
•
a lack of fully integrated end-to-end revenue cycle management
    expertise;
•
the consequences of increasing patient responsibility for their
    healthcare costs;
•
the difficulty and associated expense of a single organization
    acquiring and coordinating the knowledge and experience
    necessary to efficiently manage the revenue cycle;
•
ongoing attrition of revenue cycle staff; and
•
frequent patient confusion and frustration with financial
    obligations and billing.
The revenue cycle operations of a typical hospital, physician or
    other healthcare provider fail to capture and collect the total
    amounts owed to them from third-party payors and patients for
    medical services rendered, leading to significant bad debt
    write-offs, uncompensated care, payor denials and corresponding
    administrative write-offs, as well as lost revenue for missed
    charges. Fitch Ratings estimates that in 2008 uncompensated care
    (including bad debt write-offs, charity care and uninsured
    discounts) averaged 17% of net patient revenue at
    U.S. hospitals.
We deliver operating margin improvements to our customers
    through a combination of improvements in collections, which we
    refer to as net revenue yield, charge capture and revenue cycle
    cost reductions. Improvements in charge capture and collections
    are typically attributable to reduced payor denials,
    identification of additional items that can be billed to payors
    based on the actual procedures performed, identification of
    insurance for a higher percentage of otherwise uninsured
    patients, and improved collections of patient balances after
    insurance. Revenue cycle cost reductions are typically achieved
    through streamlining work flow, automating processes,
    centralizing vendor activities and implementing other
    efficiencies. Specific sources of margin improvement vary among
    customers.
Our customers have historically achieved significant net revenue
    yield improvements within 18 to 24 months of implementing
    our operating model, with customers operating under mature
    managed service contracts realizing 400 to 600 basis points
    in yield improvements, typically in the third or fourth contract
    year. During the assessment phase of the customer relationship,
    we identify specific areas for improvement in net revenue yield
    and begin implementation immediately upon execution of a managed
    services contract. While improvements in net revenue yield
    generally represent the majority of a customer's operating
    margin improvement, we generally are able to deliver additional
    margin improvement through revenue cycle cost reductions.
    Because our managed service contracts align our interests with
    those of our customers, we are able, over time, to improve our
    margins along with those of our customers.
We believe that our proprietary technology, management
    experience and well-developed processes are enhanced by the
    knowledge and experience we gain working with a wide range of
    customers and improve with each payor reimbursement or patient
    pay transaction. Our proprietary technology applications include
    workflow automation and direct payor connection capabilities
    that enable revenue cycle staff to focus on problem accounts
    rather than on manual tasks, such as searching payor websites
    for insurance and benefits verification for all patients. We
    employ "exception based logic" technology that
    provides the same interface for all users and automates a host
    of tasks that otherwise can consume a significant amount of
    staff time. We use real-time feedback from our
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customers to improve the functionality and performance of our
    technology and processes and incorporate these improvements into
    our service offerings on a regular basis. We strive to apply
    operational excellence throughout the entire revenue cycle.
We adapt our solution to the hospital's organizational
    structure in order to minimize disruption to existing staff and
    to make our services transparent to both patients and
    physicians. The experience and knowledge of the senior
    management personnel we provide to our customers can improve the
    performance of their in-house revenue cycle staff. Our objective
    is to improve the operating performance of our customers, thus
    generating incentive fees for ourselves, by:
•
Improving Net Revenue Yield.
We help
    our customers improve their net revenue yield. Through the use
    of our proprietary technologies and methodologies, we precisely
    calculate each customer's improvement in net revenue yield.
    This calculation compares the customer's actual cash
    collections for a given instance of care to the maximum
    potential cash receipts that the customer should have received
    from the instance of care, which we refer to as the best
    possible net compliant revenue. We aggregate these calculations
    for all instances of care and compare the result to the
    aggregate calculation for the year before we began to provide
    our services to the customer. We receive a share of each
    customer's improvement in net revenue yield.
•
Increasing Charge Capture.
We help our
    customers increase their charge capture by implementing
    optimization techniques and related processes. We utilize
    sophisticated analytics and artificial intelligence software to
    help improve the accuracy of claims filings and the resolution
    of disputed claims from third-party insurance payors. We also
    overlay a range of capabilities designed to reduce missed
    charges, improve the clinical/reimbursement interface and
    produce bills that comply with third-party payor requirements
    and applicable healthcare regulations.
•
Making Revenue Cycle Operations More
    Efficient.
We help our customers make their
    revenue cycle operations more efficient by implementing advanced
    technologies, streamlining operations, avoiding unnecessary
    re-work and improving quality. We also can reduce the costs of
    third-party services, such as Medicaid eligibility review, by
    transferring the work to our own internal operations. For some
    customers, we are able to reduce operating costs further by
    transferring selected internal operations to our centralized
    shared services centers located in the United States and India.
We employ a variety of techniques intended to achieve this
    objective:
•
Gathering Complete Information.
We
    focus on gathering complete patient information and educating
    the patient as to his or her potential financial
    responsibilities before receiving care so the services can be
    recorded and billed to the appropriate parties. Our systems
    maintain an automated electronic scorecard, which measures the
    efficiency of up-front data capture, billing and collections
    throughout the life cycle of any given patient account. These
    scorecards are analyzed in the aggregate, and the results are
    used to help improve work flow processes and operational
    decisions for our customers. We believe that hospitals employing
    our services have increased the percentage of non-emergency
    in-patient admissions with complete information profiles to
    nearly 100%, enabling fewer billing delays, increased charge
    capture and reduced billing cycles.
•
Improving Claims Filing and Third-Party Payor
    Collections.
We implement sophisticated
    analytics designed to improve claims filing and collection of
    claims from third-party insurance payors. By employing
    proprietary algorithms and modeling to determine how hospital
    revenue cycle staff should allocate time and resources across a
    pool of outstanding claims, we can increase the likelihood that
    patient services will be reimbursed. In addition, our
    proprietary tools automatically analyze the information
    collected for each patient encounter, including insurance
    coverage, personal financial status and medical treatments
    administered, to improve
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the revenue outcome from each patient account. This information
    is analyzed and updated in real time to help hospital
    administrators predict future cash flow and monitor
    underpayments from payors. Historically, third-party insurance
    payors have tracked patient services and billing information in
    more detail than hospitals, resulting in informational
    advantages for these third-party insurance payors. Our automated
    systems provide our customers with substantially the same
    quality and breadth of information available to many insurance
    companies, thereby helping them obtain contractually correct
    reimbursements in a timely manner.
•
Identifying Alternative Payment
    Sources.
We use various methods to find
    payment sources for uninsured patients and reimbursement for
    services not covered by third-party insurance. Our patient
    financial screening technology and methodologies often identify
    federal, state or private grant sources to help pay for
    healthcare services. These techniques are designed to ease the
    financial burden on uninsured or underinsured patients and
    increase the percentage of patient bills that are actually paid.
    After a typical implementation period, we have been able to help
    our customers find a third-party payment source for
    approximately 85% of all admitted patients who identified
    themselves as uninsured.
•
Employing Proprietary Technology and
    Algorithms.
Our service offerings employ a
    variety of proprietary data analytics and predictive modeling
    algorithms. For example, we identify patient accounts with
    financial risk by applying data mining techniques to the data we
    have collected. Our systems are designed to streamline work
    processes through the use of proprietary algorithms that focus
    revenue cycle staff effort on those accounts deemed to have the
    greatest potential for improving net revenue yield or charge
    capture. We frequently adjust our proprietary predictive
    algorithms to reflect changes in payor and patient behavior
    based upon the knowledge we glean from our entire customer base.
    As new customers are added and payor and patient behavior
    changes, the information we use to create our algorithms
    expands, increasing the accuracy and value of those algorithms.
    We rely upon a combination of trademark, copyright and trade
    secret law and contractual terms and conditions to protect our
    intellectual property rights, and have filed four patent
    applications covering key innovations utilized in our solution.
•
Using Analytical Capabilities and Operational
    Excellence.
We draw on the experience that we
    have gained from working with many of the best healthcare
    provider systems in the United States to train hospital staffs
    about new and innovative revenue cycle management practices. We
    employ extensive analytical analyses to identify specific
    weaknesses in business processes. We also strive to achieve
    operational excellence and to foster an overall culture of
    leading by example. As a result, our
on-site
management teams have seen marked shifts in the behaviors of
    hospital administrative staff, including enthusiasm for setting
    daily and weekly goals, participation in daily
half-hour
gatherings to track results achieved during the day, and
    improved adherence to our standard operating procedures.
In addition, we help our customers increase their revenue cycle
    efficiency by implementing improved practices, advanced data
    management technology, streamlining work flow processes and
    outsourcing aspects of their revenue cycle operations. For
    example, services that can be shared across our customers, such
    as patient scheduling and pre-registration, medical
    transcription and patient financial services, can be performed
    in our shared services centers in the United States and India.
    By leveraging the economies of scale and experience of our
    shared services centers, we believe that we offer our customers
    better quality services at a lower cost. For those customers
    opting not to participate in our shared services program, we can
    help reduce costs by migrating services such as Medicaid
    eligibility, medical transcription and collections from external
    vendors to our internal staff.
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Our
    Strategy
Our goal is to become the preferred provider-of-choice for
    revenue cycle management services in the U.S. healthcare
    industry. Since our inception, we have worked with some of the
    largest and most prestigious healthcare systems in the United
    States, such as Ascension Health, the Henry Ford Health System
    and the Dartmouth-Hitchcock Medical Center. Going forward, our
    goal is to continue to expand the scope of our services to
    hospitals within our existing customers' systems as well as
    to leverage our strong relationships with reference customers to
    continue to attract business from new customers. Key elements of
    our strategy include the following:
•
Delivering Tangible, Long-Term Results by Providing
    End-to-End Services Across the Entire Revenue
    Cycle.
Our solution is designed to help our
    customers achieve sustainable economic value through
    improvements in operating margins. Improvements in our
    customers' operating margins in turn provide recurring
    revenues for us. Our technology and services are deeply
    integrated across the entire spectrum of a customer's
    revenue cycle continuum, whereas most competitive offerings
    address a narrower portion of the revenue cycle. Our offering
    alleviates the need to purchase services from multiple sources,
    potentially saving customers time, money and integration
    challenges in their efforts to improve their revenue cycle
    activities.
•
Continuing to Develop Innovative Approaches to Increase
    Yield on Patient-Owed Obligations.
We have
    developed and continue to design creative approaches intended to
    increase net revenue yields on patient-owed obligations. These
    processes include direct communications with payors to establish
    patient pay amounts (after insurance and taking into account
    deductibles) and status, contract modeling tools to provide
    patients with accurate updates on the portion of an outstanding
    balance for which they are personally responsible, and the
    provision of prior balance data and payment alternatives to
    patients at the point of service. We also use consumer behavior
    modeling and conduct trending analyses for collections, and we
    offer patients a variety of payment methods.
•
Enhancing and Developing Proprietary Algorithms to
    Identify Potential Errors and to Make Process
    Corrections.
Even as patients begin to assume
    responsibility for a greater portion of the cost of medical
    services, healthcare providers continue to rely upon third-party
    payors for the majority of medical reimbursements. To help
    improve revenue collection rates and timing for claims owed by
    payors, we have developed proprietary algorithms to assess risk
    and the resulting treatment of claims. Our methodology is
    designed to enable nearly 100% of outstanding claims to be
    reviewed, prioritized and pursued, compared to the prevailing
    industry practice of pursuing only 80% of the outstanding
    claims. In instances where our customers had been using other
    third-party tools, we routinely identify multiple additional
    lost charges. We believe that our focus on collecting revenue
    from a broader range of outstanding claims and reducing the
    average time to collection differentiates our revenue cycle
    management services.
•
Expanding Our Shared Services
    Program.
Our shared services program, which
    includes patient scheduling and pre-registration, medical
    transcription and patient financial services, is structured to
    reduce a hospital's overhead costs while providing services
    of comparable or higher quality. Expansion of our shared
    services program is potentially advantageous for both our
    customers and us, as we both benefit from greater savings
    attributable to economies of scale and improvements in net
    revenue yield. We believe that continuing to transition
    customers to our shared services will help us achieve our
    targeted improvements in customer operating margins. We
    introduced the shared services program in 2008, and we continue
    to see interest in this offering from both new and existing
    customers. Currently, approximately 35% of our customers
    participate in our shared services program.
•
Hiring, Training and Retaining Our
    Personnel.
Our solution was developed by what
    we believe to be the best personnel available in the market. In
    order to grow our business and solidify our competitive
    position, we need to continue to hire, train and retain very
    talented
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team members who demonstrate a strong focus on outstanding
    customer service. Employee recruitment is a priority for us
    because we believe that our long-term growth is limited more by
    the availability of top talent than by constraints in market
    demand for our solution. We seek an ongoing influx of new
    personnel at all levels so that we have adequate staffing to
    pursue and accept new customer opportunities. We also make
    substantial ongoing investments in employee training, including
    our "operator academy" and "revenue cycle
    academy" which enable us to educate all new employees
    regarding our operating model and related processes and
    technology.
•
Continuing to Diversify Our Customer
    Base.
In October 2004, Ascension Health
    became our founding customer. While Ascension Health is our
    largest customer and we expect to continue to expand our
    presence within Ascension Health's network of affiliated
    hospitals, we are focusing our marketing efforts primarily on
    other healthcare providers and expect to continue to diversify
    our customer base. In the six months ended June 30, 2009
    compared to the six months ended June 30, 2008, our net
    services revenue from customers not affiliated with Ascension
    Health grew by 62.1%, while our net services revenue from
    hospitals affiliated with Ascension Health grew by 10.5%. As a
    result, the percentage of our total net services revenue
    attributable to hospitals affiliated with Ascension Health
    declined from 88.7% in the year ended December 31, 2006 to
    63.6% in the six months ended June 30, 2009. Since
    January 1, 2007, approximately $5.0 billion of the
    $7.1 billion in annual net patient revenue that we added to
    our customer base was unrelated to Ascension Health.
•
Developing Enhanced Service Offerings that Offer Long-Term
    Opportunities.
We intend to continue to
    introduce new services that draw upon our core competencies and
    that we believe will be attractive to our target customers. In
    considering new services, we look for market opportunities that
    we believe present low barriers to entry, require limited
    incremental cost and present significant growth opportunities.
    For example, we recently began targeting large physicians'
    billing organizations that are linked to hospital systems, and
    we are developing an initiative focused on increasing the
    quality of healthcare through incentive payments to primary care
    physicians. We also plan to selectively pursue acquisitions that
    will enable us to broaden our service offerings.
Our
    Services
Core Service
    Offering
Our core offering consists of end-to-end, integrated technology
    and revenue cycle management services. We assume full
    responsibility for the management and cost of the
    customer's end-to-end revenue cycle operations in exchange
    for a base fee and the opportunity to earn incentive fees. To
    implement our solution, we supplement the customer's
    existing revenue cycle management and staff with seasoned
    Accretive Health revenue cycle leaders, subject matter experts
    and staff, and connect our proprietary technology and analytical
    tools to the hospital's existing technology systems. Our
    employees that we add to the hospital's revenue cycle team
    typically have significant experience in healthcare management,
    revenue cycle operations, technology, quality control and other
    management disciplines. In addition to implementing revenue
    enhancement procedures, we help our customers reduce their
    revenue cycle costs by implementing improved practices, advanced
    data management technology and more efficient processes, as well
    as outsourcing aspects of their revenue cycle operations. We
    seek to adapt our solution to the hospital's organizational
    structure in order to minimize disruption to existing staff and
    to make our services transparent to both patients and physicians.
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We believe that our solution offers our customers a number of
    strategic, financial and operational benefits:
•
Operating Management.
We assign
    highly-trained management teams to each customer site to
    facilitate technology implementation, provide hands-on training
    to existing hospital employees and guide staff toward achievable
    performance goals.
•
Technology Improvements.
We integrate
    our proprietary technology with a hospital's transaction
    systems to help improve claims collections and realize operating
    efficiencies. By using a web interface to layer our tools on top
    of a hospital's existing software, we can bring our
    capabilities online in a timely manner without requiring any
    up-front hardware investment by customers.
•
Standardized Operating Model.
We offer
    our customers a revenue cycle operating model that has delivered
    tangible financial benefits. Our standard implementation
    techniques are designed to enable us to install our operating
    model in a timely manner and consistently at customer sites. We
    utilize a uniform set of key performance indicators to drive and
    assess the revenue cycle operations of our customers. Our senior
    operational leaders closely monitor each customer's revenue
    cycle performance through ten to twelve operating reviews each
    year.
•
Multi-Industry Revenue Process
    Experience.
Our personnel have years of prior
    work experience advising customers on revenue process management
    issues in complex industries. We have combined this experience
    with healthcare industry innovative practices and operational
    excellence to form the foundation of our service offerings. We
    believe that the depth and breadth of our knowledge of
    healthcare and non-healthcare revenue cycle management help
    differentiate us from our competitors.
•
Shared Services.
We offer customers the
    opportunity to realize operating efficiencies by outsourcing
    certain revenue tasks and responsibilities to shared facilities
    that we operate. By allowing multiple, unrelated hospitals to
    utilize the same set of resources for key revenue cycle tasks,
    our shared services capability provides opportunities to reduce
    the operating costs of our customers. We have been able to
    achieve meaningful margin improvements for the customers that
    utilize our shared services.
Our solution spans a hospital's entire revenue cycle. We
    deploy our proprietary technology and management experience at
    each key point in the revenue cycle. As part of our solution, we
    make targeted changes in the hospital's processes designed
    to improve its revenue cycle operations. We also implement
    cost-reduction programs, including the use of our shared
    services centers for customers who choose to participate and,
    for other customers, by moving services such as Medicaid
    eligibility, transcription and collections from external vendors
    to our internal staff.
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Front Office (Patient Access).
A
    hospital's front office revenue cycle operations typically
    consist of scheduling, pre-registration, registration and
    collection of patient co-payments. Complete and accurate
    information gathering at this stage is critical to a
    hospital's ability to collect revenue from the patient and
    third-party payors after healthcare services are provided.
AHtoAccess, our integrated suite of proprietary patient
    admission tools, is designed to minimize downstream collections
    issues by standardizing up-front patient information gathering
    through direct connections between the customer and each of its
    third-party payors and automated workflow navigation of
    authorization and referral requirements. AHtoAccess is used by
    our
on-site
management teams and hospital employees to handle a variety of
    front office tasks, including:
•
verification of patient contact information, which improves
    accuracy of recording patient admissions data in the
    hospital's patient accounting system;
•
real-time validation of coverage and benefits for insured
    patients, which allows up front assessment of each
    patient's ability to pay;
•
screening of self-pay patients for alternative coverage
    solutions, which helps identify payment sources including
    long-term payment plans and charity or government-sponsored
    coverage for uninsured or underinsured patients; and
•
up-front calculation of patient pay residuals, which facilitates
    accurate and timely communication and collection of residual
    payment obligations and any outstanding patient balances from
    previous services.
Middle Office (Health Services
    Billing).
Once treatment has been provided to
    a patient, a hospital's middle office revenue cycle
    operations typically consist of transcribing physicians'
    dictated records of patient care and related diagnoses,
    assigning treatment codes so that bills may be generated and
    consolidating all patient information into a single patient
    file. Our solution provides opportunities to improve revenue
    yield attributable to the middle office by enabling a customer
    to properly bill all appropriate charges, reduce payor coverage
    denials based upon inaccurate or
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incomplete billing or untimely filing, and improve the accuracy
    and comprehensiveness of patient and billing information to
    enable bills to be issued in a timely and efficient manner.
We deploy several proprietary software tools in the middle
    office. AHtoCharge is an automated variance detection tool used
    to identify missing charges in patient bills and to detect
    coding errors in patient records. In addition to the use of
    proprietary technology, we enhance a hospital's revenue
    cycle operations in the middle office with our:
•
in-house nurse auditors, who review the accuracy of treatments,
    diagnoses and charges in patient records and
follow-up
with hospital revenue cycle staff so that the bills may be
    updated and sent out within the normal billing cycle; and
•
on-staff physicians, who help hospital case managers properly
    code emergency department patients during their transition from
    "observation" to "in-patient" status, to
    improve accurate and appropriate billing to payors.
Back Office (Collections).
A
    hospital's back office revenue cycle operations typically
    consist of bill creation and submission,
follow-up
to
    resolve unpaid or underpaid claims and re-submit incomplete
    claims, the collection of amounts due from patients and the
    application of cash payments to outstanding balances. At this
    stage of the revenue cycle, efficiency and data accuracy are
    critical to increasing the hospital's collections from all
    responsible parties in a timely manner, and reducing the
    hospital's bad debt expense. Our solution is designed to
    improve revenue yield attributable to the back office by
    enabling a customer to:
•
decrease the time required for bill creation and submission;
•
increase the percentage of claims receiving maximum allowable
    reimbursement from payors;
•
find alternative payment sources for unpaid and underpaid claims
    with both third-party payors and patients; and
•
reduce contractual write-offs to provide an accurate record of
    outstanding charges.
We deploy a number of proprietary tools in the back office:
•
Yield-Based Follow Up.
Our Yield-Based
    Follow Up tool enables us to pursue reimbursement for claims
    based on risk scoring and detection as established by our
    proprietary algorithms.
•
Medical Financial Solutions.
Our
    Medical Financial Solutions tool uses proprietary algorithms to
    assess a patient's propensity to pay and determines
follow-up
actions structured to allow higher yields with lower collections
    effort.
•
Retro Eligibility.
Our Retro
    Eligibility tool continually searches for insurance coverage for
    each patient visit, even after treatment has concluded, to
    determine whether uninsured patients are eligible for some form
    of insurance coverage.
•
AHtoContract.
Our AHtoContract tool
    utilizes proprietary modeling and analytics to calculate the
    aggregate reimbursement due to the hospital from third-party
    payors and patients for a given patient treatment.
•
Underpayments.
Our Underpayments tool
    employs payor remittance data and contract models to determine
    whether a payor has reimbursed less than its contracted amount
    for a specific claim and enables the hospital's back office
    staff to resolve these situations directly with payors.
•
AHtoPost.
Our AHtoPost tool is used by
    our shared services centers to centralize the task of posting
    cash payments to customers' patient accounting systems,
    combining a sophisticated software platform with optical
    character recognition technology.
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Accretive
    Direct Service Offering
Our "Accretive Direct" service offering is a focused
    technology and services solution for smaller hospitals where
    implementation of the complete suite of
on-site
management assistance included with our core service offering is
    not economically feasible. This service offering incorporates
    additional automation and standardization into our revenue cycle
    management solution with less reliance on infused management
    personnel. Currently, we have one customer that uses our
    Accretive Direct services, which include:
•
implementation of our AHtoAccess tool in the customer's
    front office revenue cycle operations;
•
implementation of our AHtoCharge tool and our physician advisory
    services in the customer's middle office revenue cycle
    operations;
•
outsourcing of the customer's pre-service patient calling
    activities, back office revenue cycle operations and patient
    financial services activities to our shared services operating
    centers; and
•
support for audits of Medicare charges.
Quality/Cost
    Service Initiative
We are pursuing a new quality/cost service initiative that we
    believe presents attractive growth potential for us. We are
    building a turnkey technology and service solution that, once
    completed and implemented, would allow formal and informal
    organized delivery systems to provide population-based
    management of care, as compared to episodic care, and reward
    providers for cost savings and increased quality. We believe
    that our knowledge and understanding of the U.S. healthcare
    payment and reimbursement system, our business process
    experience and our technology position us well to pursue this
    opportunity.
Healthcare providers tend to focus on their own role in patient
    care rather than the totality of a patient's healthcare.
    This approach often leads to ineffective care coordination and
    can have a negative impact on healthcare quality and cost. Our
    quality/cost service initiative is intended to link episodes of
    care and facilitate the re-emergence of the primary care
    physician, or PCP, as the coordinator of care for each patient.
    We believe that appropriate financial incentives can be designed
    to encourage PCPs to focus on the prevention of acute care
    episodes — for example, through comprehensive annual
    physicals and the systematic use of HbA1c blood sugar tests for
    diabetics — and, when those episodes do occur, to
    focus on the prevention of hospital readmissions. To accomplish
    these objectives, the financial incentives would relate to,
    among other things, total integration of care, medical best
    practices and the use of healthcare information technology.
    Because PCPs drive the vast majority of healthcare decisions
    (excluding personal lifestyle decisions) that have an impact on
    healthcare, we believe that this initiative could reduce costs
    and increase healthcare quality.
We believe a service offering of this nature would be attractive
    to healthcare providers because of the potential for higher
    quality patient care and lower healthcare costs. In addition,
    the American Recovery and Reinvestment Act enacted in February
    2009 provides for potential payments over time of up to $44,000
    (under Medicare) and $64,000 (under Medicaid) to any physician
    who adopts and "meaningfully uses" electronic health
    records, and we believe our healthcare information technology
    can help physicians qualify for these payments.
We plan to beta test our quality/cost initiative at selected
    customer sites and expect to be in a position to roll out a
    service offering based on this initiative during 2010.
Customers
Customers for our core service offering typically are
    multi-hospital systems, including faith-based or community
    healthcare systems, academic medical centers and independent
    clinics, and the
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physician practice groups affiliated with those systems. Our
    core service offering is best-suited for healthcare
    organizations in which substantial improvements can be realized
    through the full implementation of our solution. Our Accretive
    Direct service offering is targeted to hospitals with less than
    $250 million in annual net patient revenue. We seek to
    develop strategic, long-term relationships with our customers
    and focus on providers that we believe understand the value of
    our operating model and have demonstrated success in both
    clinical and operational outcomes. In October 2004, Ascension
    Health became our founding customer. While Ascension Health is
    still our largest customer and we expect to continue to expand
    our presence beyond the hospitals we currently service within
    Ascension Health's network, we are focusing our marketing
    efforts primarily on other healthcare providers and expect to
    continue to diversify our customer base. As of June 30,
    2009, we provided our integrated revenue cycle service offering
    to 21 customers representing 53 hospitals and $11.9 billion
    in annual net patient revenue, as well as physicians'
    billing organizations associated with several of these customers.
We target seven market segments in the United States for our
    integrated revenue cycle service offering:
•
Academic Medical Centers and Ambulatory
    Clinics.
Academic medical centers and
    ambulatory clinics, including related physician practices,
    represent approximately $120 billion in annual net patient
    revenue. This market segment offers attractive opportunities for
    us because of the significant size and patient volume of
    academic medical centers and ambulatory clinics (typically more
    than $1 billion each in net patient revenue) and the
    fragmented revenue cycle management operations of most physician
    practices. Our customers in this market segment include the
    Dartmouth-Hitchcock Medical Center and the Henry Ford Health
    System.
•
Catholic Community Healthcare
    Systems.
Catholic community healthcare
    systems represented our initial target market segment and remain
    a primary focus for us. Catholic community healthcare systems
    manage approximately $62 billion in annual net patient
    revenue. Ascension Health is the nation's largest Catholic
    and largest non-profit healthcare system, with a network of 78
    hospitals and related healthcare facilities located in
    20 states and the District of Columbia. We serve a number
    of hospitals and regional healthcare systems affiliated with
    Ascension Health.
•
Other Faith-Based Community Healthcare
    Systems.
Drawing on our experience with the
    Catholic community healthcare system market, we also target the
    market for other faith-based community healthcare systems.
    Healthcare systems affiliated with other religious faiths manage
    approximately $42 billion in annual net patient revenue. We
    serve several regional healthcare systems in this market segment.
•
Not-for-Profit Community
    Hospitals.
There are nearly 2,000
    not-for-profit community hospitals, with a variety of
    affiliations that are not faith-based. Not-for-profit community
    hospitals manage approximately $241 billion in annual net
    patient revenue. We serve several customers in this market
    segment.
•
Physicians' Billing
    Organizations.
Large physicians' billing
    organizations, with at least 75 physicians each, represent
    approximately $115 billion in annual net patient revenue.
    Our customer work in this market includes the billing activities
    involving several hundred physicians at the Dartmouth-Hitchcock
    Medical Center and the Henry Ford Health System.
•
For-Profit Hospital Systems.
For-profit
    hospital systems manage approximately $80 billion in annual
    net patient revenue. This sector, although smaller than the
    not-for-profit sector, still represents a significant target
    market segment for our revenue cycle services. We do not
    currently have any customers in this market segment.
•
Government-Owned Hospitals.
Each major
    metropolitan area in the United States has at least one large
    municipal or city-owned hospital system, with annual net patient
    revenue
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typically in the range of $500 million to $1 billion.
    This market segment represents approximately $95 billion in
    annual net patient revenue. We do not currently have any
    customers in this market segment.
We believe that the diversity of our customer base, ranging from
    not-for-profit community hospitals to large academic medical
    centers and healthcare systems, demonstrates our ability to
    adapt and apply our operating model to many different situations.
Sales and
    Marketing
Our new business opportunities have historically been generated
    through high-level industry contacts of members of our senior
    management team and board of directors and positive references
    from existing customers. As we have grown, we have added senior
    sales executives and adopted a more institutional approach to
    sales and marketing that relies on systematic relationship
    building by all of our senior team members. Our sales process
    generally begins by engaging senior executives of the
    prospective hospital or healthcare system, typically followed by
    our assessment of the prospect's existing revenue cycle
    operations and a review of the findings. We employ a
    standardized managed service contract that is designed to
    streamline the contract process and support a collaborative
    discussion of revenue cycle operation issues and our proposed
    working relationship. Our sales process typically requires six
    to twelve months from the introductory meeting to contract
    execution.
Technology
Technology
    Development
Our technology development organization operates out of various
    facilities in the United States and India. Our technology is
    developed in-house by Accretive Health employees, although at
    times we may supplant our technology development team with
    independent contractors. We use a rapid application development
    methodology in which new functionality and enhancements are
    released on a
30-day
cycle, and minor functionality or "patch" work is
    released on a
seven-day
cycle. Based upon this schedule, we release approximately eleven
    technology offerings with new functionalities each year across
    each of the four principal portions of our customer-facing
    applications. All customer sites run the same base set of code
    with modifications isolated via a configuration management
    approach. We use a beta-testing environment to develop and test
    new technology offerings at one or more customers, while keeping
    the rest of our customers on production-level code.
Our applications are deployed on a consistent architecture based
    upon an industry-standard Microsoft SQL*Server database and a
    "DotNetNuke" open source application architecture.
    This architecture provides a common framework for development,
    which in turn simplifies the development process and offers a
    common interface for end users. We believe the consistent look
    and feel of our architecture allows our customers and staff to
    begin using ongoing enhancements to our software suite quickly
    and easily.
We devote substantial resources to our development efforts and
    plan at a yearly, half-yearly, quarterly and release level. We
    employ a "value point" scoring system to assess the
    impact an enhancement will have on net revenue, costs,
    efficiency and customer satisfaction. The results of this value
    point system analysis are evaluated in conjunction with our
    overall corporate goals when making development decisions. In
    addition to our technology development team, our operations
    personnel play an integral role in setting technology priorities
    in support of their objective of keeping our software operating
    24 hours a day, 7 days a week.
Technology
    Operations
Our applications are hosted in data centers located in Atlanta,
    Georgia and Salt Lake City, Utah, and our internal financial
    application suite is hosted in a data center in Minneapolis,
    Minnesota. These data centers are operated for us by third
    parties and are SAS-70 compliant. Our development, testing
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and quality assurance environment is operated from the data
    center in Atlanta with a separate server room in Chicago,
    Illinois. We have agreements with our hardware and system
    software suppliers for support 24 hours a day, 7 days
    a week. Our operations personnel also use our resources located
    in our other U.S. facilities and in our India facilities.
Customers use high-speed Internet connections or private network
    connections to access our business applications. We utilize
    commercially available hardware and a combination of
    custom-developed and commercially available software. We
    designed our primary application in this manner to permit
    scalable growth. For example, database servers can be added
    without adding web servers, and vice versa. We believe that this
    architecture enables us to scale our operations effectively and
    efficiently.
Our databases and servers are
backed-up
in
    full on a weekly basis and undergo incremental
back-ups
nightly. Databases are also
backed-up
frequently by automatically shipping log files with accumulated
    changes to separate sets of
back-up
servers. In addition to serving as a
back-up,
these log files update the data in our online analytical
    processing engine, enabling the data to be more current than if
    only refreshed overnight. Data and information regarding our
    customers' patients is encrypted when transmitted over the
    internet or traveling off-site on portable media such as laptops
    or backup tapes.
Customer system access requests are load-balanced across
    multiple application servers, allowing us to handle additional
    users on a per-customer basis without application changes.
    System utilization is monitored for capacity planning purposes.
Our software interacts with our customers' software through
    a series of real-time and batch interfaces. We do not require
    changes to the customer's core patient care delivery or
    financial systems. Instead of installing hardware or software in
    customer locations or data centers, we specify the information
    that a customer needs to extract from its existing systems in
    order to interface with our systems. This methodology enables
    our systems to operate with many combinations of customer
    systems, including custom and industry-standard implementations.
    We have successfully integrated our systems with 15 to
    20 year old systems, with package and custom systems, and
    with major industry-standard products.
When these interfaces are in place, we provide a tool suite
    across the hospital revenue cycle. For our purposes, the revenue
    cycle starts when a patient registers for future service or
    arrives at a hospital or clinic for unscheduled service and ends
    when the hospital has collected all the appropriate revenue from
    all possible sources. Thus, we provide eligibility, address
    validation, skip tracing, charge capture, patient and payor
follow-up,
analytics and tracking, charge master management, contract
    modeling, contract "what if" analysis, collections and
    other functions throughout the front office, middle office and
    back office operations of a customer's revenue cycle.
Because our databases run on industry-standard hardware and
    software, we are able to use all standard tools to develop,
    maintain and monitor our solution. Databases for one or more
    customers can run on a single database server with disk storage
    configured as a redundant array of inexpensive disks (RAID). In
    the event of a server failure, we have maintenance contracts in
    place that require the service provider to have the server back
    on-line in four hours or less, or we move the customer
    processing to another server. The RAID configuration protects
    against disk failures having an impact on our operations.
In the event that a combination of events causes a system
    failure, we typically can isolate the failure to one or a small
    number of customers. We believe that no combination of failures
    by our systems can impact a customer's ability to deliver
    patient care, nor can any such failures prevent accurate
    accounting of customer finances because accounting functions are
    maintained on customer systems. In the past twelve months, our
    up-time has exceeded 99.45% of planned up-time.
Our data centers were designed to withstand many catastrophic
    events, such as blizzards and hurricanes. To protect against a
    catastrophic event in which our primary data center is
    completely
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destroyed and service cannot be restored within a few days, we
    store backups of our systems and databases off-site. In the
    event that we had to move operations to a different data center,
    we would re-establish operations by provisioning new servers,
    restoring data from the off-site backups and re-establishing
    connectivity with our customers' host systems. Because our
    systems are web-based, no changes would need to be made on
    customer workstations, and customers would be able to reconnect
    as our systems became available again.
We monitor the response time of our application in a number of
    ways. We monitor the response time of individual transactions by
    customer and place monitors inside our operations and at key
    customer sites to run synthetic transactions that demonstrate
    our systems' end-to-end responsiveness. Our hosting
    provider reports on responsiveness
server-by-server
and identifies potential future capacity issues. In addition, we
    survey key customers regarding system response time to make sure
    customer-specific conditions are not impacting performance of
    our tools.
Proprietary
    Software Suite
Our proprietary AHtoAccess software suite is composed of a broad
    range of integrated functional areas or domains. The
    "patient access", "improving best possible",
"follow-up"
and "measurement" domains utilize interdependent
    design and development paths and are an integral driver of value
    throughout our customers' entire revenue cycle. These
    domains correspond to the front office, middle office and back
    office revenue cycle business processes described above.
•
The "patient access" domain is used during hospital
    employees' first interactions with patients, either at the
    point of service in a hospital or in advance of a hospital visit
    during our pre-registration process. The domain uses a
    straightforward, consistent architecture.
•
The "improving best possible" domain is designed to
    facilitate top-line revenue improvements and bottom-line
    efficiency gains. The domain's AHtoCharge tool is a
    rules-based engine that, with the oversight of a centralized
    team of nurse-auditors, automatically analyzes medical billing
    and coding data to identify inconsistencies that may delay or
    hinder collections.
•
The
"follow-up"
domain tracks unpaid claims and contacts with insurance
    companies, government organizations and other payors responsible
    for outstanding debts for past patient services. The domain also
    organizes previously unpaid claims using a proprietary
    risk-based algorithm.
•
The "measurement" domain integrates our functional
    domains by providing real-time metrics and insight into the
    operation of revenue cycle businesses. This application can be
    used to generate standard operational reports and allows the end
    user to review and analyze all of the micro-level data that
    supports the results found in these reports.
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In addition to applications designed for use by our customers,
    we have developed proprietary software for use in our
    collections operations and measurement activity. To manage
    patient
follow-up
activities and the collection of patient debt, we use a
    combination of off-the-shelf telephony and campaign management
    software which analyzes critical data points to determine the
    optimum approach for collecting outstanding debts. Our
    measurement system enables a user to generate models for
    outstanding medical claims related to specific third-party
    payors and determine the maximum allowed reimbursement, based
    upon the hospital's contract with each payor.
Competition
While we do not believe any single competitor offers a fully
    integrated, end-to-end revenue cycle management solution, we
    face competition from various sources.
The internal revenue cycle management staff of hospitals, who
    historically have performed the functions addressed by our
    services, in effect compete with us. Hospitals that previously
    have made investments in internally developed solutions
    sometimes choose to continue to rely on their own internal
    revenue cycle management staff.
We also compete with three categories of external participants
    in the revenue cycle market, most of which focus on small
    components of the hospital revenue cycle:
•
software-as-a-service or other technology-supported revenue
    cycle management business process outsourcing companies, such as
    athenahealth, Eclipsys and MedAssets;
•
traditional consultants, either specialized healthcare
    consulting firms or healthcare divisions of large accounting
    firms, such as Deloitte Consulting and Huron Consulting; and
•
IT outsourcers, which typically are large, non-healthcare
    focused business process outsourcing and information technology
    outsourcing firms, such as Perot Systems and Computer Science
    Corporation/First Consulting.
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We believe that competition for revenue cycle management
    services is based primarily on the following factors:
•
knowledge and understanding of the complex healthcare payment
    and reimbursement system in the United States;
•
a track record of delivering revenue improvements and efficiency
    gains for hospitals and healthcare systems;
•
the ability to deliver a solution that is fully-integrated along
    each step of a hospital's revenue cycle operations;
•
cost-effectiveness, including the breakdown between up-front
    costs and pay-for-performance incentive compensation;
•
reliability, simplicity and flexibility of the technology
    platform;
•
understanding of the healthcare industry's regulatory
    environment; and
•
sufficient infrastructure and financial stability.
We believe that we compete effectively based upon all of these
    criteria. We also believe that several aspects of our business
    model differentiate us from our competitors:
•
our solution does not require any up-front cash investment from
    customers and we do not charge hourly or licensing fees for our
    services;
•
we serve only healthcare providers and do not provide services
    to third-party payors; and
•
we focus on delivering significant and sustainable revenue cycle
    improvements rather than one-time cost reductions only.
Nonetheless, we operate in a growing and attractive market with
    a steady stream of new entrants. Although we believe that there
    are significant barriers to replicating our end-to-end revenue
    cycle solution, other companies may develop superior or more
    economical service offerings that hospitals could find more
    attractive than our offerings. Moreover, the regulatory
    landscape may shift in a direction that is more strategically
    advantageous to existing and future companies.
Government
    Regulation
The customers we serve are subject to a complex array of federal
    and state laws and regulations. These laws and regulations may
    change rapidly, and it is frequently unclear how they apply to
    our business. We devote significant efforts, through training of
    personnel and monitoring, to establish and maintain compliance
    with all regulatory requirements that we believe are applicable
    to our business and the services we offer.
Government
    Regulation of Health Information
Privacy and Security Regulations.
The
    Health Insurance Portability and Accountability Act of 1996, as
    amended, and the regulations that have been issued under it,
    which we collectively refer to as HIPAA, contain substantial
    restrictions and requirements with respect to the use and
    disclosure of individuals' protected health information.
    HIPAA prohibits a covered entity from using or disclosing an
    individual's protected health information unless the use or
    disclosure is authorized by the individual or is specifically
    required or permitted under HIPAA. Under HIPAA, covered entities
    must establish administrative, physical and technical safeguards
    to protect the confidentiality, integrity and availability of
    electronic protected health information maintained or
    transmitted by them or by others on their behalf.
HIPAA applies to covered entities, such as healthcare providers
    that engage in HIPAA-defined standard electronic transactions,
    health plans and healthcare clearinghouses, as well as
    "business
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associates" that perform functions on behalf or provide
    services to covered entities. Our customers are covered
    entities, and we are considered a "business associate"
    under HIPAA as a result of our contractual obligations to and
    interactions with our customers. In order to provide customers
    with services that involve the use or disclosure of protected
    health information, HIPAA requires our customers to enter into
    business associate agreements with us so that certain HIPAA
    requirements would be applied to us as contractual commitments.
    Such agreements must, among other things, provide adequate
    written assurances:
•
as to how we will use and disclose the protected health
    information;
•
that we will implement reasonable administrative, physical and
    technical safeguards to protect such information from misuse;
•
that we will enter into similar agreements with our agents and
    subcontractors that have access to the information;
•
that we will report security incidents and other inappropriate
    uses or disclosures of the information; and
•
that we will assist the customer with certain of its duties
    under HIPAA.
Transaction Requirements.
In addition
    to privacy and security requirements, HIPAA also requires that
    certain electronic transactions related to healthcare billing be
    conducted using prescribed electronic formats. For example,
    claims for reimbursement that are transmitted electronically to
    payors must comply with specific formatting standards, and these
    standards apply whether the payor is a government or a private
    entity. We are contractually required to structure and provide
    our services in a way that supports our customers' HIPAA
    compliance obligations.
Data Security and Breaches.
In recent
    years, there have been well-publicized data breach incidents
    involving the improper dissemination of personal health and
    other information of individuals, both within and outside of the
    healthcare industry. Many states have responded to these
    incidents by enacting laws requiring holders of personal
    information to maintain safeguards and to take certain actions
    in response to data breach incidents, such as providing prompt
    notification of the breach to affected individuals and
    government authorities. In many cases, these laws are limited to
    electronic data, but states are increasingly enacting or
    considering stricter and broader requirements. In February 2009,
    HIPAA was amended by the Health Information Technology for
    Economic and Clinical Health, or HITECH, Act to add provisions
    that will, beginning in 2010, impose certain of the HIPAA
    privacy and security requirements directly upon business
    associates. When new regulations take effect in late 2009, both
    covered entities and their business associates will be required
    to notify individuals and government authorities of data
    security breaches involving unsecured protected health
    information. In addition, the U.S. Federal Trade
    Commission, or FTC, has prosecuted some data breach cases as
    unfair and deceptive acts or practices under the Federal Trade
    Commission Act. We have implemented and maintain physical,
    technical and administrative safeguards intended to protect all
    personal data and have processes in place to assist us in
    complying with applicable laws and regulations regarding the
    protection of this data and properly responding to any security
    incidents.
State Laws.
In addition to HIPAA, most
    states have enacted patient confidentiality laws that protect
    against the unauthorized disclosure of confidential medical
    information, and many states have adopted or are considering
    further legislation in this area, including privacy safeguards,
    security standards and data security breach notification
    requirements. Such state laws, if more stringent than HIPAA
    requirements, are not preempted by the federal requirements, and
    we must comply with them even though they may be subject to
    different interpretations by various courts and other
    governmental authorities.
Other Requirements.
In addition to
    HIPAA, numerous other state and federal laws govern the
    collection, dissemination, use, access to and confidentiality of
    individually identifiable health and other information and
    healthcare provider information. The FTC has issued and several
    states have issued
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or are considering new regulations to require holders of certain
    types of personally identifiable information to implement formal
    policies and programs to prevent, detect and mitigate the risk
    of identity theft and other unauthorized access to or use of
    such information. Further, the U.S. Congress and a number
    of states have considered or are considering prohibitions or
    limitations on the disclosure of medical or other information to
    individuals or entities located outside of the United States.
Government
    Regulation of Reimbursement
Our customers are subject to regulation by a number of
    governmental agencies, including those that administer the
    Medicare and Medicaid programs. Accordingly, our customers are
    sensitive to legislative and regulatory changes in, and
    limitations on, the government healthcare programs and changes
    in reimbursement policies, processes and payment rates. During
    recent years, there have been numerous federal legislative and
    administrative actions that have affected government programs,
    including adjustments that have reduced or increased payments to
    physicians and other healthcare providers and adjustments that
    have affected the complexity of our work. It is possible that
    the federal or state governments will implement future
    reductions, increases or changes in reimbursement under
    government programs that adversely affect our customer base or
    our cost of providing our services. Any such changes could
    adversely affect our own financial condition by reducing the
    reimbursement rates of our customers.
Fraud and
    Abuse Laws
A number of federal and state laws, generally referred to as
    fraud and abuse laws, are used to prosecute healthcare
    providers, physicians and others that make, offer, seek or
    receive referrals or payments for products or services that may
    be paid for through any federal or state healthcare program and
    in some instances any private program. Given the breadth of
    these laws and regulations, they are potentially applicable to
    our business. These laws and regulations include:
Anti-Kickback Laws.
There are numerous
    federal and state laws that govern patient referrals, physician
    financial relationships, and inducements to healthcare providers
    and patients. The federal healthcare anti-kickback law prohibits
    any person or entity from offering, paying, soliciting or
    receiving anything of value, directly or indirectly, for the
    referral of patients covered by Medicare, Medicaid and other
    federal healthcare programs or the leasing, purchasing, ordering
    or arranging for or recommending the lease, purchase or order of
    any item, good, facility or service covered by these programs.
    Courts have construed this anti-kickback law to mean that a
    financial arrangement may violate this law if any one of the
    purposes of an arrangement is to encourage patient referrals or
    other federal healthcare program business, regardless of whether
    there are other legitimate purposes for the arrangement. There
    are several limited exclusions known as safe harbors that may
    protect some arrangements from enforcement penalties. These safe
    harbors have very limited application. Penalties for federal
    anti-kickback violations can be severe, and include
    imprisonment, criminal fines, civil money penalties with triple
    damages and exclusion from participation in federal healthcare
    programs. Many states have similar anti-kickback laws, some of
    which are not limited to items or services for which payment is
    made by a federal healthcare program.
False or Fraudulent Claim Laws.
There
    are numerous federal and state laws that forbid submission of
    false information or the failure to disclose information in
    connection with the submission and payment of physician claims
    for reimbursement. In some cases, these laws also forbid abuse
    of existing systems for such submission and payment, for
    example, by systematic over treatment or duplicate billing of
    the same services to collect increased or duplicate payments.
In particular, the federal False Claims Act, or FCA, prohibits a
    person from knowingly presenting or causing to be presented a
    false or fraudulent claim for payment or approval by an officer,
    employee or agent of the United States. In addition, the FCA
    prohibits a person from knowingly making, using, or causing to
    be made or used a false record or statement material to such a
    claim. The FCA was
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amended on May 20, 2009 by the Fraud Enforcement and
    Recovery Act of 2009, or FERA. Following the FERA amendments,
    the FCA's "reverse false claim" provision also
    creates liability for persons who knowingly and improperly
    conceal the retention of an overpayment of government money.
    Violations of the FCA may result in treble damages, significant
    monetary penalties, and other collateral consequences including,
    potentially, exclusion from participation in federally funded
    health care programs. The scope and implications of the FERA
    amendments have yet to be fully determined or adjudicated and as
    a result it is difficult to predict how future enforcement
    initiatives may impact our business.
In addition, under the Civil Monetary Penalty Act of 1981, the
    Department of Health and Human Services Office of Inspector
    General has the authority to impose administrative penalties and
    assessments against any person, including an organization or
    other entity, who knowingly presents, or causes to be presented,
    to a state or federal government employee or agent certain false
    or otherwise improper claims.
Stark Law and Similar State Laws.
The
    Ethics in Patient Referrals Act, known as the Stark Law,
    prohibits certain types of referral arrangements between
    physicians and healthcare entities. Physicians are prohibited
    from referring patients for certain designated health services
    reimbursed under federally-funded programs to entities with
    which they or their immediate family members have a financial
    relationship or an ownership interest, unless such referrals
    fall within a specific exception. Violations of the statute can
    result in civil monetary penalties
and/or
exclusion from the Medicare and Medicaid programs. Furthermore,
    reimbursement claims for care rendered under forbidden referrals
    may be deemed false or fraudulent, resulting in liability under
    other fraud and abuse laws.
Laws in many states similarly forbid billing based on referrals
    between individuals
and/or
entities that have various financial, ownership or other
    business relationships. These laws vary widely from state to
    state.
Laws Limiting
    Assignment of Reimbursement Claims
Various federal and state laws, including Medicare and Medicaid,
    forbid or limit assignments of claims for reimbursement from
    government funded programs. Some of these laws limit the manner
    in which business service companies may handle payments for such
    claims and prevent such companies from charging their provider
    customers on the basis of a percentage of collections or
    charges. We do not believe that the services we provide our
    customers result in an assignment of claims for the Medicare or
    Medicaid reimbursements for purposes of federal health care
    programs. Any determination to the contrary, however, could
    adversely affect our ability to be paid for the services we
    provide to our customers, require us to restructure the manner
    in which we are paid, or have further regulatory consequences.
Emergency
    Medical Treatment and Active Labor Act
The federal Emergency Medical Treatment and Active Labor Act, or
    EMTALA, was adopted by the U.S. Congress in response to
    reports of a widespread hospital emergency room practice of
    "patient dumping". At the time of EMTALA's
    enactment, patient dumping was considered to have occurred when
    a hospital capable of providing the needed care sent a patient
    to another facility or simply turned the patient away based on
    such patient's inability to pay for his or her care. EMTALA
    imposes requirements as to the care that must be provided to
    anyone who seeks care at facilities providing emergency medical
    services. In addition, the Centers for Medicare and Medicaid
    Services of the U.S. Department of Health and Human
    Services, has issued final regulations clarifying those areas
    within a hospital system that must provide emergency treatment,
    procedures to meet on-call requirements, as well as other
    requirements under EMTALA. Sanctions for failing to fulfill
    these requirements include exclusion from participation in the
    Medicare and Medicaid programs and civil monetary penalties. In
    addition, the law creates private civil remedies that enable an
    individual who suffers personal harm as a direct result of a
    violation of the law to sue the offending hospital for
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damages and equitable relief. A hospital that suffers a
    financial loss as a direct result of another participating
    hospital's violation of the law also has a similar right.
EMTALA generally applies to our customers, and we assist our
    customers with the intake of their patients. Although we believe
    that our patient intake practices are in compliance with the law
    and applicable regulations, we cannot be certain that
    governmental officials responsible for enforcing the law or
    others will not assert that we are in violation of these laws
    nor what obligations may be imposed by regulations to be issued
    in the future.
Regulation of
    Debt Collection Activities
The federal Fair Debt Collection Practices Act, or FDCPA,
    regulates persons who regularly collect or attempt to collect,
    directly or indirectly, consumer debts owed or asserted to be
    owed to another person. Certain of our accounts receivable
    activities may be subject to the FDCPA. The FDCPA establishes
    specific guidelines and procedures that debt collectors must
    follow in communicating with consumer debtors, including the
    time, place and manner of such communications. Further, it
    prohibits harassment or abuse by debt collectors, including the
    threat of violence or criminal prosecution, obscene language or
    repeated telephone calls made with the intent to abuse or
    harass. The FDCPA also places restrictions on communications
    with individuals other than consumer debtors in connection with
    the collection of any consumer debt and sets forth specific
    procedures to be followed when communicating with such third
    parties for purposes of obtaining location information about the
    consumer. In addition, the FDCPA contains various notice and
    disclosure requirements and prohibits unfair or misleading
    representations by debt collectors. Finally, the FDCPA imposes
    certain limitations on lawsuits to collect debts against
    consumers.
Debt collection activities are also regulated at state level.
    Most states have laws regulating debt collection activities in
    ways that are similar to, and in some cases more stringent than,
    the FDCPA. In addition, some states require debt collection
    companies to be licensed. In all states where we operate, we
    believe that we currently hold all required state licenses or
    are exempt from licensing.
We are also subject to the Fair Credit Reporting Act, or FCRA,
    which regulates consumer credit reporting and which may impose
    liability on us to the extent that the adverse credit
    information reported on a consumer to a credit bureau is false
    or inaccurate. State law, to the extent it is not preempted by
    the FCRA, may also impose restrictions or liability on us with
    respect to reporting adverse credit information.
The FTC has the authority to investigate consumer complaints
    relating to the FDCPA and the FCRA, and to initiate or recommend
    enforcement actions, including actions to seek monetary
    penalties. State officials typically have authority to enforce
    corresponding state laws. In addition, affected consumers may
    bring suits, including class action suits, to seek monetary
    remedies (including statutory damages) for violations of the
    federal and state provisions discussed above.
Regulation of
    Credit Card Activities
We accept payments by credit cards from patients of our
    customers. Various federal and state laws impose privacy and
    information security laws and regulations with respect to the
    use of credit cards. If we fail to comply with these laws and
    regulations or experience a credit card security breach, our
    reputation could be damaged, possibly resulting in lost future
    business, and we could be subjected to additional legal or
    financial risk as a result of non-compliance.
Foreign
    Regulations
Our operations in India are subject to additional regulations by
    the government of India. These include Indian federal and local
    corporation requirements, restrictions on exchange of funds,
    employment-related laws and qualification for tax status.
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Intellectual
    Property
We rely upon a combination of trademark, copyright and trade
    secret laws and contractual terms and conditions to protect our
    intellectual property rights, and have sought patent protection
    for aspects of our key innovations.
As of June 30, 2009, we have filed four patent
    applications. We do not know, however, whether any of these
    patent applications will result in the issuance of patents or
    whether the examination process will require us to narrow our
    claims. Legal standards relating to the validity, enforceability
    and scope of protection of patents can be uncertain. If any of
    our applications issues as a patent, that patent may be opposed,
    contested, circumvented, designed around by a third party or
    found to be invalid or unenforceable. Our patent applications
    may not issue with the scope of the claims that we seek, if at
    all, or the scope of the claims that may issue may not be
    sufficiently broad to protect our products and technology. Third
    parties may develop technologies that are similar or superior to
    our proprietary technologies, duplicate or otherwise obtain and
    use our proprietary technologies or design around patents owned
    or licensed by us. If our technology is found to infringe any
    patent or other intellectual property right held by a third
    party, we could be prevented from providing our service
    offerings and subject us to significant damage awards.
We rely in some circumstances on trade secrets to protect our
    technology. We control access to and the use of our application
    capabilities through a combination of internal and external
    controls, including contractual protections with employees,
    customers, contractors and business partners. We license some of
    our software through agreements that impose specific
    restrictions on customers' ability to use the software,
    such as prohibiting reverse engineering and limiting the use of
    copies. We also require employees and contractors to sign
    non-disclosure agreements and invention assignment agreements to
    giver us ownership of intellectual property developed in the
    course of working form us.
On occasion, we incorporate third-party commercial or open
    source software products into our technology platform. Although
    we prefer to develop our own technology, we periodically employ
    third-party software in order to simplify our development and
    maintenance efforts, provide a "commodity" capability,
    support our own technology infrastructure or test a new
    capability.
Employees
As of June 30, 2009, we had 1,305 full-time employees,
    including 147 engaged in technology development and deployment.
    None of our employees is represented by a labor union and we
    consider our current employee relations to be good.
Our operations employees are required to participate in our
    "operator academy" and "revenue cycle
    academy", consisting of multiple training sessions each
    year. Our ongoing training and executive learning programs are
    modeled after the practices of companies that we believe have
    reputations for service excellence. In addition, all of our
    employees undergo mandatory HIPAA training.
Pursuant to managed service contracts, we also manage over 6,000
    revenue cycle staff persons who are employed by our customers.
    We have the right to control and direct the work activities of
    these staff persons and are responsible for paying their
    compensation out of the base fees paid to us by our customers,
    but these staff persons are considered employees of our
    customers for all purposes.
Facilities
As of June 30, 2009, our corporate headquarters occupy
    approximately 28,000 square feet in Chicago, Illinois under
    a lease expiring on various dates in 2013 and 2014. We have an
    option to cancel the lease effective November 30, 2011 if
    the landlord is unable, prior to December 31, 2010, to
    provide approximately 22,000 square feet of additional
    office space on an adjacent floor. If the landlord provides this
    additional office space, we are obligated to lease it, and we
    will have the option to concurrently return approximately
    6,500 square feet of office space on a non-adjacent floor.
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Assuming the landlord provides this additional
    22,000 square feet of office space and we do not return the
    6,500 square feet of office space, the lease for all
    50,000 square feet will be extended until ten years and
    90 days after the date we take possession of the additional
    22,000 square feet of office space. In addition, after the
    landlord provides this additional office space, we will have an
    option to lease at least 50% of the rentable space on another
    floor in the same building. We also have rights of first offer
    on other space in the same building.
As of June 30, 2009, we also leased facilities in Jupiter,
    Florida; Kalamazoo, Michigan and Cape Girardeau, Missouri; and
    near New Delhi, India. Pursuant to our master services agreement
    with Ascension Health and the managed service contracts between
    us and our customers, we occupy space
on-site
at
    all hospitals where we provide our revenue cycle management
    services. We do not pay customers for our use of space provided
    by them. In general, we are not permitted to provide services to
    one customer from another customer's site.
We believe that our current facilities are sufficient for our
    current needs. We intend to add new facilities or expand
    existing facilities as we add employees or expand our geographic
    markets, and we believe that suitable additional or substitute
    space will be available as needed to accommodate any such
    expansion of our operations.
Legal
    Proceedings
From time to time, we have been and may again become involved in
    legal proceedings or regulatory investigations arising in the
    ordinary course of our business. We are not presently a party to
    any material litigation and we are not aware of any pending or
    threatened litigation against us that could have a material
    adverse effect on our business, operating results, financial
    condition or cash flows.
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MANAGEMENT
Executive
    Officers and Directors
Our executive officers and directors, their current positions
    and their ages as of June 30, 2009 are set forth below:
Name
Age
Position(s)
Mary A. Tolan
49
Founder, President and Chief Executive Officer, Director
John T. Staton
48
Chief Financial Officer and Treasurer
Etienne H. Deffarges
51
Executive Vice President
Gregory N. Kazarian
46
Senior Vice President, General Counsel and Secretary
J. Michael Cline(1)
49
Founder and Chairman of the Board
Edgar M. Bronfman, Jr.(1)(3)
54
Director
Steven N. Kaplan(2)(3)
49
Director
Denis J. Nayden(1)
55
Director
George P. Shultz(3)
88
Director
Arthur H. Spiegel, III(1)
70
Director
Mark A. Wolfson(2)
56
Director
(1)
Member of compensation committee.
(2)
Member of audit committee.
(3)
Member of nominating and corporate governance committee.
Mary A. Tolan
, a founder of Accretive Health, has
    served as our president and chief executive officer and a
    director since November 2003. Prior to joining our company,
    Ms. Tolan spent 21 years at Accenture Ltd, a leading
    global management consulting, technology services and
    outsourcing company. At Accenture, Ms. Tolan served in
    several leadership roles, including group chief executive for
    the resources operating group that had approximately
    $2 billion in annual revenue, and as a member of
    Accenture's executive committee and management committee.
    She serves on the board of trustees of the University of
    Chicago, Loyola University and the Lyric Opera of Chicago.
John T. Staton
has served as our chief financial
    officer and treasurer since September 2005. Mr. Staton was
    with Accenture for 16 years before joining our company.
    From 2004 to 2005, Mr. Staton led the business consulting
    practice within Accenture's North American products
    practice. Prior to this role, he was a partner in
    Accenture's global retail practice. Before joining
    Accenture, Mr. Staton held positions in General
    Electric's manufacturing management program and
    Hewlett-Packard's sales and channel marketing organizations.
Etienne H. Deffarges
has served as our executive
    vice president since April 2004. From 1999 until joining our
    company, Mr. Deffarges was a partner at Accenture, most
    recently serving as managing partner for its global utilities
    industry group, and as a member of its executive committee.
    Prior to joining Accenture, Mr. Deffarges spent
    14 years at Booz Allen Hamilton Inc., a strategy and
    technology consulting firm, including serving as a senior
    partner and global practice leader of the energy, chemicals and
    pharmaceuticals practice from 1994 to 1999 and as a member of
    its executive committee.
Gregory N. Kazarian
has served as our senior vice
    president, general counsel and secretary since January 2004.
    Prior to joining our company, Mr. Kazarian was with the law
    firm Pedersen & Houpt, P.C. for 16 years,
    where he handled employment, intellectual property,
    creditors' rights, dispute resolution and outsourcing
    matters.
J. Michael Cline
, a founder of Accretive
    Health, has been a member of our board of directors since August
    2003 and has served as chairman of the board since July 2009.
    Mr. Cline has served as the founding managing partner of
    Accretive, LLC, a private equity firm, since founding that firm
    in
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December 1999. From 1989 to 1999, Mr. Cline served as a
    general partner of General Atlantic Partners, LLC, a private
    equity firm. Mr. Cline serves on the boards of several
    privately-held companies. He also serves on the advisory board
    of the Harvard Business School Rock Center for Entrepreneurship,
    on the board of the National Fish and Wildlife Foundation and as
    a trustee of Panthera, an organization devoted to the
    preservation of the world's wild cat species where he also
    chairs Panthera's Tigers Forever initiative.
Edgar M. Bronfman, Jr.
has been a member of
    our board of directors since October 2006. Mr. Bronfman has
    served as chairman and chief executive officer of Warner Music
    Group since March 2004. Before joining Warner Music Group,
    Mr. Bronfman served as chairman and chief executive officer
    of Lexa Partners LLC, a management venture capital group which
    he founded in April 2002. Mr. Bronfman was vice chairman of
    the board of directors of Vivendi Universal, S.A. from December
    2000 until December 2003 and also served as an executive officer
    of Vivendi Universal from December 2000 until March 2002. Prior
    to the formation of Vivendi Universal, Mr. Bronfman served
    as president and chief executive officer of The Seagram Company
    Ltd. from June 1994 until December 2000 and as president and
    chief operating officer of Seagram from 1989 until June 1994.
    Mr. Bronfman is a director of IAC/InterActiveCorp, a
    publicly-held operator of Internet businesses. Mr. Bronfman
    is also a member of the board of trustees of the New York
    University Medical Center and the board of governors of the
    Joseph H. Lauder Institute of Management and International
    Studies at the University of Pennsylvania. He also is a general
    partner of Accretive, LLC, a private equity firm.
Steven N. Kaplan
has been a member of our board of
    directors since July 2004. Since 1988, Mr. Kaplan has
    served as a professor at the University of Chicago Booth School
    of Business, where he currently is the Neubauer Family Professor
    of Entrepreneurship and Finance and serves as the faculty
    director of the Polsky Center for Entrepreneurship.
    Mr. Kaplan also serves as a director of Morningstar, Inc.,
    a publicly-held provider of independent investment research, and
    on the boards of trustees of the Columbia Acorn Trust and Wanger
    Asset Trust.
Denis J. Nayden
has been a member of our board of
    directors since October 2003 and served as co-chairman of our
    board until July 2009. Mr. Nayden has served as a managing
    partner of Oak Hill Capital Management, LLC, a private equity
    firm, since 2003. From 2000 to 2002, he was chairman and chief
    executive officer of GE Capital Corporation, the financing unit
    of General Electric Company, and prior to that had a
25-year
tenure at General Electric. Mr. Nayden is a director of
    Genpact Limited, a publicly-held global provider of business
    process services; RSC Holdings, Inc., a publicly-held equipment
    rental provider; Duane Reade Holdings, Inc., a publicly-held
    operator of a drugstore chain in New York City; and several
    privately-held companies. He also serves on the board of
    trustees of the University of Connecticut.
George P. Shultz
has been a member of our board of
    directors since April 2005. Mr. Shultz has had a
    distinguished career in government, academia and business. He
    has served as the Thomas W. and Susan B. Ford Distinguished
    Fellow at the Hoover Institution of Stanford University since
    1991. Mr. Shultz served as United States Secretary of State
    from 1982 until 1989, chairman of the President's Economic
    Policy Advisory Board from 1981 until 1982, United States
    Secretary of the Treasury and Chairman of the Council on
    Economic Policy from 1972 until 1974, Director of the Office of
    Management and Budget from 1970 to 1972, and United States
    Secretary of Labor from 1969 until 1970. From 1948 to 1957,
    Mr. Shultz taught at MIT, taking a year's leave of
    absence in 1955 to serve as a senior staff economist on the
    President's Council of Economic Advisors during the
    Eisenhower administration. He then taught from 1957 to 1969 at
    Stanford University and the University of Chicago Graduate
    School of Business, where he also served as Dean for six years.
    From 1974 to 1982, Mr. Shultz was president and a director
    of Bechtel Group, Inc., a privately-held global leader in
    engineering, construction and project management. Among numerous
    honors, Mr. Shultz was awarded the Medal of Freedom, the
    nation's highest civilian honor, in 1989, and holds
    honorary degrees from more than a dozen universities. He also
    chairs the Governor of California's Economic Advisory Board
    and the J.P. Morgan Chase International Council; serves as
    Advisory Council Chair of
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the Precourt Energy Efficiency Center at Stanford University;
    chairs the MIT Energy Initiative External Advisory Board; and
    serves on the board of directors of Fremont Group, L.L.C., a
    private investment firm.
Arthur H. Spiegel, III
has been a member of
    our board of directors since October 2003 and served as
    co-chairman of our board until July 2009. Since 2002,
    Mr. Spiegel has been a private investor. From 1996 until
    2002, Mr. Spiegel was President of CSC Healthcare Group,
    which offered consulting, system integration, claims processing
    software and business process and IT outsourcing services to the
    healthcare industry. Mr. Spiegel founded APM Management
    Consultants, a healthcare consulting firm, in 1974 and served as
    its CEO until it was acquired by Computer Science Corporation in
    1996. He serves on the boards of several privately-held
    companies.
Mark A. Wolfson
has been a member of our board of
    directors since October 2003. Mr. Wolfson has served as a
    managing partner of Oak Hill Capital Management, LLC, a private
    equity firm, since 1998, and is a founding managing partner of
    Oak Hill Investment Management, L.P. Mr. Wolfson has been
    on the faculty of the Stanford University Graduate School of
    Business since 1977, has served as its associate dean, and has
    held the title of consulting professor since 2001. He has been a
    research associate of the National Bureau of Economic Research
    since 1988 and serves on the executive committee of the Stanford
    Institute for Economic Policy Research. Mr. Wolfson is a
    director of eGain Communications Corporation, a publicly-held
    provider of multi-channel customer service and knowledge
    management software; and Conversus Asset Management, LLC, which
    manages the portfolio of Conversus Capital, L.P., a
    publicly-traded portfolio of third-party private equity funds.
    He is also an advisor to the investment committee of the William
    and Flora Hewlett Foundation.
Board
    Composition
Our board of directors currently consists of eight members, all
    of whom were elected as directors pursuant to a
    stockholders' agreement that we have entered into with
    holders of our convertible preferred stock. Aspects of the board
    voting arrangements contained in the stockholders'
    agreement will expire on November 15, 2009. Upon the
    closing of this offering, all remaining board voting
    arrangements will terminate and there will be no further
    contractual obligations regarding the election of our directors.
    Our directors hold office until their successors have been
    elected and qualified or until the earlier of their resignation
    or removal. There are no family relationships among any of our
    directors or executive officers.
In accordance with the terms of our restated certificate of
    incorporation and amended and restated by-laws, our board of
    directors is divided into three classes, each of which consists,
    as nearly as possible, of one-third of the total number of
    directors constituting our entire board of directors and each of
    whose members serve for staggered three-year terms. As a result,
    only one class of our board of directors will be elected each
    year. Upon the expiration of the term of a class of directors,
    directors in that class will be eligible to be elected for a new
    three-year term at the annual meeting of stockholders in the
    year in which their term expires. The members of the classes are
    as follows:
•
the class I directors are
    Messrs.                    
    , and their term expires at the annual meeting of stockholders
    to be held in 2010;
•
the class II directors are
    Messrs.                    
    , and their term expires at the annual meeting of stockholders
    to be held in 2011; and
•
the class III directors are
    Messrs.                    
    , and their term expires at the annual meeting of stockholders
    to be held in 2012.
Our restated certificate of incorporation and restated by-laws
    provide that the authorized number of directors may be changed
    only by resolution of the board of directors. Our restated
    certificate of incorporation and restated by-laws also provide
    that our directors may be removed only for cause by the
    affirmative vote of the holders of at least two-thirds of the
    votes that all our stockholders would be entitled to cast in an
    annual election of directors, and that any vacancy on our board
    of directors,
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including a vacancy resulting from an enlargement of our board
    of directors, may be filled only by vote of a majority of our
    directors then in office.
Director
    Independence
Pursuant to the corporate governance listing standards of the
    New York Stock Exchange, a director employed by us cannot be
    deemed to be an "independent director", and
    consequently Ms. Tolan is not an independent director. In
    addition, in accordance with the NYSE corporate governance
    listing standards, each other director will qualify as
    "independent" only if our board of directors
    affirmatively determines that he or she has no material
    relationship with us, either directly or as a partner,
    stockholder or officer of an organization that has a
    relationship with us. Ownership of a significant amount of our
    stock, by itself, does not constitute a material relationship.
Our board of directors has affirmatively determined that each of
    Messrs. Bronfman, Cline, Kaplan, Nayden, Shultz, Spiegel
    and Wolfson is "independent" in accordance with
    Section 303A.02(b) of the NYSE Listed Company Manual. In
    making this determination, our board of directors considered the
    percentage of our common stock owned by an entity affiliated
    with Accretive, LLC, of which Mr. Cline is the founding
    managing partner and Mr. Bronfman is a general partner, and
    the percentage of our common stock owned by FW Oak Hill
    Accretive Healthcare Investors, L.P., of which
    Messrs. Nayden and Wolfson are limited partners. Our board
    also considered that Messrs. Nayden and Wolfson are
    managing partners of Oak Hill Capital Management, LLC, an entity
    associated with FW Oak Hill Accretive Healthcare Investors,
    L.P., and that Mr. Wolfson is a managing partner of Oak
    Hill Investment Management, L.P., another entity associated with
    FW Oak Hill Accretive Healthcare Investors, L.P., and a Vice
    President and Assistant Secretary of Group VI 31, LLC, the
    general partner of FW Oak Hill Accretive Healthcare Investors,
    L.P. See "Principal and Selling Stockholders".
All of the members of the board's three standing committees
    described below are independent as defined under the rules of
    the New York Stock Exchange.
Board
    Committees
Our board of directors has established an audit committee, a
    compensation committee and a nominating and corporate governance
    committee. Each committee operates under a charter that has been
    approved by our board of directors. Following this offering,
    copies of each committee's charter will be posted on the
    Investor Relations section of our website.
Audit
    Committee
The members of our audit committee are Messrs. Kaplan
    (chair) and Wolfson. Our board of directors has determined that
    each of the members of our audit committee satisfy the
    requirements for financial literacy under the current
    requirements of the New York Stock Exchange and rules and
    regulations. Prior to the closing of this offering, we intend to
    appoint a third member to our audit committee, who will replace
    Mr. Kaplan as chair, to be an "audit committee
    financial expert", as defined by SEC rules, and satisfy the
    financial sophistication requirements of the New York Stock
    Exchange. Our audit committee assists our board of directors in
    its oversight of our accounting and financial reporting process
    and the audits of our financial statements.
The audit committee's responsibilities include:
•
appointing, evaluating, retaining, terminating the engagement
    of, setting the compensation of and assessing the independence
    of our independent registered public accounting firm;
•
overseeing the work of our independent registered public
    accounting firm, including the receipt and consideration of
    reports from the firm and reviewing with the firm audit
    problems, internal control issues and other accounting and
    financial reporting matters;
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•
coordinating the board's oversight of our internal control
    over financial reporting, disclosure controls and procedures,
    code of business conduct and ethics, and internal audit function;
•
establishing procedures for the receipt, retention and treatment
    of accounting related complaints and concerns;
•
reviewing and discussing with management and our independent
    registered public accounting firm our annual and quarterly
    financial statements and related disclosures;
•
periodically meeting separately with our independent registered
    public accounting firm, management and internal auditors;
•
discussing generally the type and presentation of information to
    be disclosed in our earnings press releases, as well as
    financial information and earnings guidance provided to
    analysts, rating agencies and others;
•
reviewing our policies and procedures for approving and
    ratifying related person transactions, including our related
    person transaction policy;
•
establishing policies regarding the hiring of employees or
    former employees of our independent registered public accounting
    firm;
•
discussing our policies with respect to risk assessment and risk
    management;
•
preparing the audit committee report required by SEC rules;
•
in coordination with the compensation committee, evaluating our
    senior financial management; and
•
at least annually, evaluating its own performance.
All audit services to be provided to us and all non-audit
    services, other than de minimis non-audit services, to be
    provided to us by our independent registered public accounting
    firm must be approved in advance by our audit committee.
Compensation
    Committee
The members of our compensation committee are
    Messrs. Nayden (chair), Bronfman, Cline and Spiegel. Our
    compensation committee assists our board of directors in the
    discharge of its responsibilities relating to the compensation
    of our executive officers. The compensation committee's
    responsibilities include:
•
approving corporate goals and objectives relevant to the
    compensation of our chief executive officer, evaluating our
    chief executive officer's performance in light of those
    goals and objectives and, either as a committee or together with
    the other independent directors (as directed from time to time
    by the board of directors), determining and approving our chief
    executive officer's compensation;
•
reviewing in consultation with our chief executive officer, and
    approving or making recommendations to the board of directors
    with respect to, compensation of our executive officers (other
    than our chief executive officer);
•
overseeing the evaluation of our senior executives, in
    consultation with our chief executive officer in the case of all
    senior executives other than the chief executive officer and in
    conjunction with the audit committee in the case of our senior
    financial management;
•
reviewing and making recommendations to the board of directors
    with respect to incentive-compensation and equity-based plans
    that are subject to board approval;
•
administering our equity incentive plans, including the
    authority to delegate to one or more of our executive officers
    the power to grant options or other stock awards to employees
    who are
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not directors or executive officers of our company, but only if
    consistent with the requirements of the applicable plan and law;
•
reviewing and making recommendations to the board of directors
    with respect to director compensation;
•
reviewing and discussing with management the compensation
    discussion and analysis required by SEC rules;
•
preparing the compensation committee report required by SEC
    rules; and
•
at least annually, evaluating its own performance.
Nominating and
    Corporate Governance Committee
The members of our nominating and corporate governance committee
    are Messrs. Shultz (chair), Bronfman and Kaplan. The
    nominating and corporate governance committee's
    responsibilities include:
•
recommending to the board of directors the persons to be
    nominated for election as directors or to fill vacancies on the
    board of directors, and to be appointed to each of the
    board's committees;
•
applying the criteria for selecting directors approved by the
    board, and annually reviewing with the board the requisite
    skills and criteria for new board members as well as the
    composition of the board of directors as a whole;
•
developing and recommending to the board corporate governance
    guidelines applicable to our company;
•
overseeing an annual evaluation of the board of directors;
•
at the request of the board of directors, reviewing and making
    recommendations to the board relating to management succession
    planning; and
•
at least annually, evaluating its own performance.
Compensation
    Committee Interlocks and Insider Participation
None of our executive officers serves as a member of the board
    of directors or compensation committee, or other committee
    serving an equivalent function, of any entity that has one or
    more executive officers who serve as members of our board of
    directors or our compensation committee. None of the members of
    our compensation committee is an officer or employee of our
    company, nor have they ever been an officer or employee of our
    company.
Corporate
    Governance Guidelines
Prior to the closing of this offering, our board of directors
    intends to adopt corporate governance guidelines to assist the
    board in the exercise of its duties and responsibilities and to
    serve the best interests of our company and our stockholders.
    Following this offering, a copy of these guidelines will be
    posted on the Investor Relations section of our website. These
    guidelines, which provide a framework for the conduct of the
    board's business, are expected to provide that:
•
the board's principal responsibility is to oversee the
    management of Accretive Health;
•
directors have an obligation to become and remain informed about
    our company and business;
•
directors are responsible for determining that effective systems
    are in place for periodic and timely reporting to the board on
    important matters concerning our company;
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•
directors are responsible for attending board meetings, meetings
    of committees on which they serve and the annual meeting of
    stockholders;
•
a majority of the members of the board of directors shall be
    independent directors;
•
each director must limit the number of other public company
    boards on which he or she serves so that he or she is able to
    devote adequate time to his or her duties to Accretive Health,
    including preparing for and attending meetings;
•
the non-management directors meet in executive session at least
    semi-annually;
•
directors have full and free access to officers and employees of
    our company, and the right to hire and consult with independent
    advisors at our expense;
•
new directors participate in an orientation program and all
    directors are expected to participate in continuing director
    education on an ongoing basis; and
•
at least annually, the board of directors and its committees
    will conduct self-evaluations to determine whether they are
    functioning effectively.
Code of Business
    Conduct and Ethics
Prior to the closing of this offering, our board of directors
    intends to adopt a written code of business conduct and ethics
    that will apply to our directors, officers and employees,
    including our principal executive officer, principal financial
    officer, principal accounting officer or controller, or persons
    performing similar functions. Following this offering, a copy of
    the code of business conduct and ethics will be posted on the
    Investor Relations section of our website.
Director
    Compensation
Since our company was formed, we have not paid cash compensation
    to any director for his or her service as a director. However,
    non-employee directors are reimbursed for reasonable travel and
    other expenses incurred in connection with attending our board
    and committee meetings.
In the past, we have granted restricted stock and options to
    purchase shares of our common stock to our non-employee
    directors who are not affiliated with our 5% stockholders. We
    did not grant any restricted stock or options to purchase shares
    of our common stock to our non-employee directors during our
    fiscal year ended December 31, 2008. Ms. Tolan has
    never received any compensation in connection with her service
    as a director.
The following table sets forth information regarding
    compensation earned by our non-employee directors during 2008.
Stock Awards
Total
Name
($)(1)
Compensation ($)
J. Michael Cline
—
—
Edgar M. Bronfman, Jr.
—
—
Steven N. Kaplan
—
—
Denis J. Nayden
—
—
George P. Shultz
$
23,175
$
23,175
Arthur H. Spiegel
—
—
Mark A. Wolfson
—
—
(1)
Valuation of this award is based on the dollar amount of
    share-based compensation expense that we recognized for
    financial statement reporting purposes in 2008 computed in
    accordance with SFAS 123(R). This amount does not represent
    the actual amounts paid to or realized by the director during
    2008. The assumptions used by us with respect to the valuation
    of this award are the same as those set forth in Note 10 to
    our financial statements included elsewhere in this prospectus.
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Upon the closing of this offering, we intend to implement a
    director compensation plan to provide non-employee directors
    with appropriate cash and equity compensation for service on the
    board of directors and committees of the board of directors. The
    amount of this compensation has not been determined, but we
    anticipate that it will be consistent with amounts paid by
    comparable public companies.
Executive
    Compensation
Compensation
    Discussion and Analysis
This section discusses the principles underlying our executive
    compensation policies and decisions and the most important
    factors relevant to an analysis of these policies and decisions.
    It provides qualitative information regarding the manner and
    context in which compensation is awarded to and earned by our
    executives and is intended to place in perspective the data
    presented in the tables and narrative that follow.
As we have prepared to become a public company, our compensation
    committee has begun a thorough review of all elements of our
    executive compensation program, including the function and
    design of our annual cash incentive and equity incentive
    programs. The compensation committee has begun, and expects to
    continue in the coming months, to evaluate the need for
    revisions to our executive compensation program to ensure our
    program is competitive with the companies with which we compete
    for superior executive talent. As part of this process, the
    compensation committee is considering the competitiveness of the
    elements of the compensation packages we offer to our
    executives, as well as their total compensation packages.
Overview of
    Executive Compensation Process
Roles of Our Board, Compensation Committee and Chief
    Executive Officer in Compensation
    Decisions.
Our compensation committee
    oversees our executive compensation program, and has done so
    historically. In this role, the compensation committee has
    reviewed all compensation decisions relating to our executive
    officers and has made recommendations to the board. Our chief
    executive officer annually reviews the performance of each of
    our other executive officers, and, based on these reviews,
    provides recommendations to the committee and the board with
    respect to salary adjustments, annual cash incentive bonus
    targets and awards and equity incentive awards. Our compensation
    committee meets with our chief executive officer annually to
    discuss and review her recommendations regarding executive
    compensation for our executive officers, excluding herself.
    These recommendations are forwarded to the board, which
    typically meets in executive session to discuss those
    recommendations and to consider the compensation of the chief
    executive officer. Our chief executive officer is not present
    for board or committee discussions regarding her compensation.
    Our chief executive officer may grant options to executive
    officers other than herself and determine the number of shares
    covered by, and the timing of, option grants. The board has, and
    it exercises, the ability to materially increase or decrease
    amounts of compensation payable to our executive officers
    pursuant to recommendations made by our chief executive officer.
Competitive Market Data and Use of Compensation
    Consultants.
Historically, our compensation
    committee has not formally benchmarked our executive
    compensation against compensation data, but rather has relied on
    its members' business judgment and collective experience,
    including in the healthcare and consulting industries. As part
    of our preparation to become a public company, in August 2009
    our compensation committee engaged an independent compensation
    consulting firm to provide advice regarding our executive
    compensation program and general information regarding executive
    compensation practices in our industry. Although the
    compensation committee and board consider the compensation
    consulting firm's advice in considering our executive
    compensation program, the compensation committee and board
    ultimately make their own decisions about these matters.
At the compensation committee's request, the independent
    compensation consulting firm has conducted a number of
    compensation analyses to provide information regarding
    competitive pay and practices for executives of technology,
    business process outsourcing and healthcare services
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companies comparable to us in terms of revenue and growth rate,
and/or
which
    are anticipated to be comparable to us in terms of market
    capitalization. This peer group, which will be periodically
    reviewed and updated by the compensation committee, consists of:
Akamai Technologies
Genpact
Metavente
Athenahealth
Global Payments
Nuance Communications
Blackboard
HLTH Corp
Quality Systems
Cerner
Huron Consulting
salesforce.com
Cognizant Tech Solutions
MAXIMUS
SXC Health Solutions
Eclipsys
MedAssets
WNS Holdings
Although the board and compensation committee may consider peer
    group data, to date, they have not benchmarked total executive
    compensation or most compensation elements against this peer
    group, and they do not aim to set total compensation, or any
    compensation element, at a specified level as compared to the
    companies in our peer group.
Objectives and
    Philosophy of Our Executive Compensation Program
Our primary objective with respect to executive compensation is
    to attract, retain and motivate highly talented individuals who
    have the breadth and experience to successfully execute our
    business strategy. Our executive compensation program is
    designed to:
•
reward the achievement of our annual and long-term operating and
    strategic goals;
•
recognize individual contributions; and
•
align the interests of our executives with those of our
    stockholders by rewarding performance that meets or exceeds
    established goals, with the ultimate objective of increasing
    stockholder value.
To achieve these objectives, our executive compensation program
    ties a portion of each executive's overall compensation to
    key corporate financial goals, primarily adjusted EBITDA
    targets, as well as to individual performance. We also provide a
    portion of our executive compensation in the form of equity
    incentive awards that vest over time, which we believe helps to
    retain our executive officers and aligns their interests with
    those of our stockholders by allowing them to participate in our
    long-term performance as reflected in the trading price of
    shares of our common stock.
Elements of Our
    Executive Compensation Program
The primary elements of our executive compensation program are:
•
base salaries;
•
annual cash incentive bonuses;
•
equity incentive awards; and
•
other employee benefits.
Our compensation committee has not adopted any formal or
    informal policies or guidelines for allocating compensation
    between these elements.
Base Salaries.
We use competitive base
    salary to attract and retain qualified candidates to help us
    achieve our growth and performance goals. Base salaries are
    intended to recognize an executive officer's immediate
    contribution to our organization, as well as his or her
    experience, knowledge and responsibilities.
From time to time, in its discretion, our compensation committee
    and board evaluate and adjust executive officer base salary
    levels based on factors determined to be relevant, including:
•
the executive officer's skills and experience;
•
the particular importance of the executive officer's
    position to us;
•
the executive officer's individual performance;
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•
the executive officer's growth in his or her position;
•
market level increases;
•
base salaries for comparable positions within our
    company; and
•
inflation rates.
Our compensation committee and board historically have
    considered annual base salary adjustments in the first quarter
    of the year. From 2004 through 2007, we did not increase the
    base salary of any of our executive officers, other than a
    nominal increase in 2007 to reflect the rate of inflation. In
    the first quarter of 2008, our board increased our executive
    officers' (other than our chief financial officer) base
    salaries by 25% over their original base salaries, because until
    such time, they had not received increases commensurate with
    their significant contributions to the development of our
    business in its early stages. In light of general economic
    conditions in the first quarter of 2009, and despite our strong
    performance in 2008, we did not increase any executive
    officer's base salary for 2009.
Annual Cash Incentive Bonuses.
We
    maintain an annual cash incentive bonus program in which each of
    our executive officers participates. These annual cash incentive
    bonuses are intended to compensate our executive officers for
    our achievement of corporate financial goals, primarily adjusted
    EBITDA targets, as well as individual performance in the areas
    of:
•
economic and financial contributions;
•
operations;
•
customer satisfaction;
•
business development; and
•
organizational and leadership development.
Our annual cash incentive bonuses have varied from year to year,
    and we expect that they will continue to vary, depending on
    actual corporate and individual performance results.
Historically, our board has set our corporate financial goals
    and our executive officers' individual cash incentive bonus
    targets each year in advance. However, during the course of the
    year, the board and our compensation committee, based on
    recommendations of our chief executive officer (with respect to
    our other executive officers), may adjust such goals as they
    deem appropriate.
Historically, our board has worked with our chief executive
    officer to develop aggressive goals to be achieved by the
    company and our executive officers. The goals established by the
    board have been based on our historical operating results and
    growth rates, as well as our expected future results, and are
    designed to require significant effort and operational success
    on the part of our executive officers and the company.
The board has historically set each executive officer's
    target annual cash incentive bonus level at the higher of the
    executive's prior year actual bonus and his or her prior
    year target bonus. The board believes that this approach
    supports our pay-for-performance philosophy and encourages the
    achievement of growth and performance goals. The board approves
    actual annual cash incentive bonuses, based on the
    recommendations of our compensation committee, with input from
    our chief executive officer in the case of executive officers
    other than herself. There are no minimum or maximum payout
    levels, and our board has broad discretion to make adjustments
    to the awards.
For the year ended December 31, 2008, our corporate
    financial goals were based on adjusted EBITDA. Our compensation
    committee believes that adjusted EBITDA is an appropriate
    measure of our business performance because it emphasizes the
    addition of new customers and expansion of services with
    existing customers, as well as improvements in our operating
    efficiency, and it is reflective of stockholder value creation.
    In 2008, we exceeded our adjusted EBITDA target by
    $1.5 million, and our actual adjusted EBITDA was
    $12.2 million.
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For the years ended December 31, 2008 and 2009, each
    executive officer's target bonus awards as a percentage of
    his or her base salary were set as follows:
Target Annual
Cash Incentive
Bonus
Year Ended
December 31,
Executive Officer
2008
2009
Chief Executive Officer
$
450,000
$
600,000
Chief Financial Officer
$
183,000
$
258,000
Executive Vice President
$
346,750
$
446,750
Senior Vice President and General Counsel
$
127,250
$
202,250
Because our adjusted EBITDA for the year ended December 31,
    2008 exceeded our goal, our board exercised its discretion to
    increase our executive officers' annual cash incentive
    bonuses above the targets. For the actual 2008 amounts that we
    paid to each executive officer under our annual cash incentive
    bonus program, see the Summary Compensation Table below.
Our board uses our unaudited financial results to make financial
    target performance determinations under our annual cash
    incentive bonus program, and those results may be adjusted in
    connection with the preparation of our audited consolidated
    financial statements. You should read our consolidated financial
    statements, the related notes to these financial statements and
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations" included elsewhere in
    this prospectus. As described above, the purpose of these
    targets was to establish a method for determining the payment of
    cash incentive bonuses. You are cautioned not to rely on these
    performance goals as a prediction of our future performance.
From time to time, we may make special cash bonus awards to our
    employees, including our executive officers. In July 2008 and
    August 2009, we determined to award special cash bonuses of
    approximately $81,000 and $143,000, respectively, to our chief
    financial officer contemporaneously with the cash dividend we
    declared on all outstanding capital stock in each of those
    years. Each of our executive officers, other than our chief
    financial officer, received an award of common stock, rather
    than stock options, in connection with his or her employment,
    and accordingly, participates in the cash dividends. Our chief
    financial officer received a stock option award, which remains
    outstanding, in connection with his employment and, accordingly,
    is not entitled to participate in cash dividends. We believe the
    contributions to our business made by our chief financial
    officer are on par with those made by our other executive
    officers and, accordingly, our board determined to award him
    these special cash bonuses, each of which represents the payment
    he would have received as a cash dividend had he owned such
    number of shares equal to the vested portion of his option on
    the record date for the applicable dividend.
Equity Incentive Awards.
Our equity
    incentive award program is the primary vehicle for offering
    long-term incentives to our executive officers. To date, equity
    incentive awards to our executive officers have been made in the
    form of restricted stock awards and stock options, and our
    compensation committee currently intends to continue this
    practice. Although we do not have any equity ownership
    guidelines or requirements for our executive officers, we
    believe that equity incentive awards:
•
provide our executive officers with a strong link to our
    long-term performance, including by enhancing their
    accountability for long-term decision making;
•
help balance the short-term orientation of our annual cash
    incentive bonus program;
•
create an ownership culture by aligning the interests of our
    executive officers with the creation of value for our
    stockholders; and
•
further our goal of executive retention.
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Employees who are considered essential to our long-term success
    are eligible to receive equity incentive awards, which typically
    vest over four years. As of September 1, 2009, all equity
    incentive awards granted to our executive officers had fully
    vested. Accordingly, in connection with its evaluation of the
    need for revisions to our executive compensation program, our
    compensation committee intends to make additional equity
    incentive awards to our executive officers in the near future.
In determining the size of equity incentive awards to executive
    officers, our compensation committee generally considers the
    executive's experience, skills, level and scope of
    responsibilities and internal comparisons to other comparable
    positions in our company.
Other Employee Benefits.
We maintain
    broad-based benefits that are provided to all employees,
    including our 401(k) retirement plan, flexible spending
    accounts, a medical care plan, vacation and standard company
    holidays. Our executive officers are eligible to participate in
    each of these programs on the same terms as non-executive
    employees; however, we do not provide a matching 401(k)
    contribution for any of our executive officers. See
    "— 401(k) Retirement Plan" for more
    information regarding our 401(k) retirement plan.
We also provide for each of our chief executive officer, chief
    financial officer and executive vice president supplemental
    disability income protection that provides income replacement in
    the event of a qualifying disability.
Severance and Change of Control
    Arrangements.
We have an employment agreement
    with our chief executive officer that provides a combination of
    "single trigger" and "double trigger"
    benefits in connection with a change of control of our company
and/or
termination of her employment. We believe a combination of
    "single trigger" and "double trigger"
    vesting along with severance payments maximizes stockholder
    value because it limits any unintended windfalls to executives
    in the event of a friendly change of control, while still
    providing executives appropriate incentives to cooperate in
    negotiating any change of control, including a change of control
    in which they believe they may lose their jobs. We also have an
    employment agreement with our chief financial officer and an
    offer letter with our general counsel, each of which provides
    for specified salary continuation, and in the case of our chief
    financial officer, benefits continuation, in the event of
    specified employment terminations.
See "— Potential Payments upon Termination or
    Change in Control" and "Employment Agreements"
    for a more detailed description of these arrangements.
Deductibility
    of Executive Compensation
Section 162(m) of the Internal Revenue Code, which will
    become applicable to us upon the closing of this offering,
    generally disallows a tax deduction for compensation in excess
    of $1.0 million paid to our chief executive officer and our
    four other most highly paid executive officers, except our chief
    financial officer. Qualifying performance-based compensation is
    not subject to the deduction limitation if specified
    requirements are met. We periodically review the potential
    consequences of Section 162(m) and we generally intend to
    structure the performance-based portion of our executive
    compensation, where feasible, to comply with exemptions in
    Section 162(m) so that the compensation remains tax
    deductible to us. However, our board or compensation committee
    may, in their judgment, authorize compensation payments that are
    not exempt under Section 162(m) when they believe that such
    payments are appropriate to attract and retain executive talent.
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Summary
    Compensation Table
The following table sets forth information regarding
    compensation earned by our chief executive officer, our chief
    financial officer and our two other executive officers during
    our fiscal year ended December 31, 2008. We refer to these
    individuals as our named executive officers.
Non-Equity
Stock
Incentive Plan
All Other
Name and
Salary
Bonus
Awards
Option
Compensation
Compensation
Total
Principal Position
($)
($)
($)(1)
Awards ($)(1)
($)
($)(2)
($)
Mary A. Tolan
$
515,000
150,000
—
—
$
450,000
$
8,760
$
1,123,760
Founder, President and Chief Executive Officer(3)
John T. Staton
321,360
156,099
—
$
133,632
183,000
6,049
800,140
Chief Financial Officer and Treasurer
Etienne H. Deffarges
437,500
100,000
$
1,244
—
346,750
12,753
899,015
Executive Vice President
Gregory N. Kazarian
281,250
75,000
—
—
127,250
—
483,500
Senior Vice President, General Counsel and Secretary
(1)
Valuation of these option awards is
    based on the dollar amount of share-based compensation expense
    that we recognized for financial statement reporting purposes in
    2008 computed in accordance with SFAS 123(R), excluding the
    impact of estimated forfeitures related to service-based vesting
    conditions. These amounts do not represent the actual amounts
    paid to or realized by the named executive officer during 2008.
    The assumptions used by us with respect to the valuation of
    option awards are the same as those set forth in Note 10 to
    our financial statements included elsewhere in this prospectus.
(2)
Amounts represent long-term
    disability insurance premiums paid by us on behalf of each of
    the named executive officers.
(3)
Ms. Tolan is also a member of
    our board of directors but does not receive any additional
    compensation in her capacity as a director.
Grants of
    Plan-Based Awards in 2008
The following table sets forth information for 2008 regarding
    grants of compensation in the form of plan-based awards made
    during 2008 to our named executive officers.
Future Payouts
Under Non-Equity
Incentive
Plan Awards
Target
Name
($)(1)
Mary A. Tolan
$
450,000
John T. Staton
$
183,000
Etienne H. Deffarges
$
346,750
Gregory N. Kazarian
$
127,250
(1)
Annual cash incentive bonuses paid
    under the annual cash incentive bonus program for 2008 are also
    disclosed in the "Summary Compensation Table."
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Outstanding
    Equity Awards at Year End
The following table sets forth information regarding outstanding
    stock options held by our named executive officers as of
    December 31, 2008. We did not grant any equity awards to
    our named executive officers during 2008, none of our executive
    officers exercised any stock options and no restricted stock
    awards held by our named executive officers became vested during
    2008, other than 48,611 shares of restricted common stock
    held by Mr. Deffarges, which vested in full in 2008.
Option Awards
Equity Incentive
Plan Awards:
Number of
Number of
Number of
Securities
Securities
Securities
Underlying
Underlying
Underlying
Unexercised
Unexercised
Unexercised
Option
Options
Options
Unearned
Exercise
Option
(#)
(#)
Options
Price
Expiration
Name
Exercisable
Unexercisable
(#)
($)
Date
Mary A. Tolan
—
—
—
—
—
John T. Staton
199,295
(1)
—
—
3.01
8/31/2015
Etienne H. Deffarges
—
—
—
—
—
Gregory N. Kazarian
—
—
—
—
—
(1)
This stock option was immediately
    exercisable upon grant, and as of December 31, 2008, was
    vested as to 149,413, and unvested as to 49,882, shares of
    common stock. Unvested shares of common stock issued upon
    exercise of an option remain subject to our right of repurchase
    upon termination and to restrictions on transfer. This stock
    option vested in equal monthly installments and was fully vested
    as of September 1, 2009.
Potential
    Payments Upon Termination or Change of Control
The table below summarizes the potential payments to each of our
    named executive officers if he or she were to be terminated on
    December 31, 2008 under the circumstances described in the
    footnotes below.
Severance
Medical/Welfare
Name
Payments(1)
Benefits(2)
Total Benefits
Mary A. Tolan
$
515,000
(3)
—
$
515,000
John T. Staton
$
599,994
(4)
$
18,252
(4)
$
618,246
Etienne H. Deffarges
—
—
—
Gregory N. Kazarian
$
281,250
(5)
—
$
281,250
(1)
Amounts subject to a reduction for compensation earned by the
    named executive officer from any new employment during the
    severance period.
(2)
Calculated based on the estimated cost to us of providing these
    benefits.
(3)
Represents amounts payable for termination due to death or
    "disability" or termination without "cause"
    or for "good reason" pursuant to the employment
    agreement described below.
(4)
Represents amounts payable for termination without
    "cause" or for "good reason" pursuant to the
    employment agreement described below.
(5)
Represents amounts payable for termination without
    "cause" pursuant to the offer letter described below.
Employment
    Agreements
Mary A. Tolan.
We entered into an
    at-will employment agreement with Mary A. Tolan, our president
    and chief executive officer, effective January 2004. Pursuant to
    the agreement, Ms. Tolan is entitled to an annual base
    salary of at least $400,000, subject to adjustment by our board
    of directors. Ms. Tolan's annual base salary is
    currently $515,000. Pursuant to the agreement, Ms. Tolan
    earned a
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one-time cash performance bonus of $200,000 based on customer
    procurement during 2004 consistent with our business plan.
    Pursuant to the agreement, in March 2004, our board of directors
    granted Ms. Tolan 3,000,000 shares of restricted
    stock, which vested in equal monthly installments over four
    years ending November 2007.
If Ms. Tolan's employment is terminated due to her
    death or "disability", if we terminate
    Ms. Tolan's employment without "cause" or if
    Ms. Tolan terminates her employment for "good
    reason", as those terms are defined in her employment
    agreement, (1) Ms. Tolan will be entitled to receive
    her base salary paid in accordance with our payroll practices
    during the 12 months following such termination, subject to
    a reduction for any compensation she earns from any new
    employment during the severance period, and
    (2) Ms. Tolan's outstanding stock-based awards
    will continue to vest until the earlier of 12 months
    following her termination or the end of the applicable
    award's vesting period. In the event of a "change in
    control", as such term is defined in her employment
    agreement, 50% of all unvested shares of Ms. Tolan's
    stock-based awards will accelerate and vest in full as of the
    effective date of the "change in control". If
    Ms. Tolan's employment is terminated without
    "cause" or if Ms. Tolan terminates her employment
    for "good reason" within 12 months after a
    "change in control", the remaining 50% of all unvested
    shares of Ms. Tolan's stock-based awards will
    accelerate and vest in full. If Ms. Tolan is terminated for
    "cause", she has agreed to execute a limited stock
    power transferring all rights to vote the 3,000,000 shares
    of restricted stock granted to her pursuant to the employment
    agreement to a person we designate in our sole discretion.
    Ms. Tolan's employment agreement restricts her from
    engaging in activities competitive with us, soliciting our
    employees and consultants, and diverting business from us for a
    period of 12 months following her termination.
John T. Staton.
We entered into an
    at-will employment agreement with John T. Staton, our chief
    financial officer and treasurer, effective June 2005. Pursuant
    to the agreement, Mr. Staton is entitled to an annual base
    salary of at least $300,000, subject to adjustment by our board
    of directors and our chief executive officer.
    Mr. Staton's annual base salary is currently $321,360.
    Mr. Staton is eligible to earn an annual performance bonus
    of up to $100,000 per year, with the full $100,000 guaranteed
    for each of his first two years of employment. Pursuant to the
    agreement, in September 2005, our board of directors granted
    Mr. Staton an option to purchase 299,295 shares of our
    common stock at an exercise price of $3.01 per share, vesting in
    equal monthly installments over four years ending September 2009.
If we terminate Mr. Staton's employment without
    "cause" or if Mr. Staton terminates his
    employment for "good reason", as those terms are
    defined in his employment agreement, Mr. Staton will be
    entitled to receive $33,333 per month during the 18 months
    following such termination, subject to a reduction for any
    compensation he earns from any new employment during the
    severance period. If Mr. Staton's employment is
    terminated without "cause" or if Mr. Staton
    terminates his employment for "good reason",
    Mr. Staton and his family will be entitled to continue to
    participate in our health insurance plan during the
    18 months following termination to the extent of his
    participation prior to termination, and we will pay the premiums
    that we paid prior to termination. Mr. Staton's
    employment agreement restricts him from engaging in activities
    competitive with us, soliciting our employees and consultants,
    and diverting business from us for a period of 18 months
    following his termination.
Gregory N. Kazarian.
We entered into an
    offer letter with Gregory N. Kazarian, our senior vice
    president, general counsel and secretary, in December 2003.
    Pursuant to the offer letter, Mr. Kazarian is entitled to
    an annual base salary of $225,000. Mr. Kazarian's
    annual base salary is currently $281,250. Pursuant to the offer
    letter, Mr. Kazarian earned a one-time cash performance
    bonus of $75,000 based on customer procurement, and was entitled
    to receive an option to purchase shares of our common stock then
    representing 1.5% of our common stock. In lieu of the option, in
    June 2004, our board of directors awarded Mr. Kazarian
    250,000 shares of common stock, then representing 1.5% of
    our common stock, which vested in equal monthly installments
    over four years ending before January 2008. If we terminate
    Mr. Kazarian's employment without cause,
    Mr. Kazarian will be entitled to receive his current
    monthly base salary during the 12 months following such
    termination, subject to a reduction for any compensation he
    earns from any new employment during the severance period.
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Confidentiality
    and Non-Disclosure Agreements
As a condition to employment, each named executive officer
    entered into a confidentiality and non-disclosure agreement with
    us. Under these agreements, each named executive officer has
    agreed:
•
not to solicit our employees and customers during his or her
    employment and for a period of 18 months after the
    termination of employment;
•
not to compete with us during his or her employment and for a
    period of 12 months after the termination of employment;
•
to protect our confidential and proprietary information; and
•
to assign to us intellectual property developed during the
    course of his or her employment.
Stock Option and
    Other Compensation Plans
Amended and
    Restated Stock Option Plan
Our amended and restated stock option plan, which we refer to as
    our prior option plan, was adopted by our board of directors in
    December 2005. The plan was amended and restated in February
    2006 and further amended in May 2007, October 2008 and January
    2009. As of June 30, 2009, a maximum of
    3,544,862 shares of common stock was authorized for
    issuance under our prior option plan.
As of June 30, 2009, there were options to purchase
    2,440,885 shares of common stock outstanding under our
    prior option plan, 930,149 shares of common stock had been
    issued pursuant to the exercise of options granted under this
    plan (of which 892,201 shares were vested) and
    173,828 shares of common stock were available for future
    grants under the plan.
Our prior option plan provides for the grant of options that are
    not intended to qualify as incentive stock options under
    Section 422 of the Internal Revenue Code, which we refer to
    as non-statutory stock options. Our employees, directors and
    outside consultants are eligible to receive options under the
    plan. The plan is administered by the board of directors, our
    compensation committee or another committee designated by the
    board of directors. Subject to limitations specified in the
    plan, the committee or our chief executive officer may grant
    options, select option recipients and determine the number of
    shares covered by, and the timing of, option grants, except that
    our chief executive officer may not grant options to herself.
Unless otherwise prescribed in an option agreement, options
    granted pursuant to our prior option plan vest in equal
    installments on each of the first four anniversaries of the
    grant date. Options under our prior option plan are immediately
    exercisable upon grant, provided that unvested shares of common
    stock issued upon exercise of an option remain subject to our
    right of repurchase upon termination and to restrictions on
    transfer. Subject to the repurchase right, upon exercise of an
    option, a holder has the rights of a stockholder as to both the
    vested and unvested shares. In the event an option holder's
    employment or service is terminated other than for cause, as
    defined in the plan, the unvested portion of the unexercised
    option shall be forfeited, the vested but unexercised portion of
    the option may be exercised within 60 days and unvested
    shares that were issued upon prior exercises are subject to our
    right of repurchase at a price per share equal to the lesser of
    the option's exercise price or the fair market value at the
    time of termination. In the event an option holder's
    employment or service is terminated for cause, the vested but
    unexercised portion of the option is forfeited, vested shares
    that were issued upon prior exercises are subject to our right
    of repurchase at a price per share equal to the option's
    exercise price, and unvested shares that were issued upon prior
    exercises are subject to our right of repurchase at a price per
    share equal to the lesser of the option's exercise price or
    the fair market value at the time of termination.
Upon a "change of control", as defined in the plan,
    all unvested shares issued upon prior exercises of options
    granted under our prior option plan will be accelerated in full
    unless the acquirer replaces the shares with its shares subject
    to the same vesting schedule. If an acquirer of our
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company does not accept the assignment of our repurchase rights
    under the prior option plan, the repurchase rights will
    terminate upon the change of control.
Our prior option plan restricts option recipients from engaging
    in activities competitive with us, soliciting our employees and
    consultants, and diverting business from us while serving as an
    employee, director or consultant and for periods of 18 to
    24 months after termination of employment or service.
Restricted
    Stock Plan
Our restricted stock plan was adopted by our board of directors
    in March 2004 and amended in June 2004. As of June 30,
    2009, there were 6,599,591 shares of common stock
    outstanding under our restricted stock plan, all of which were
    vested.
Our restricted stock plan provides for the grant of restricted
    stock awards. Our employees, directors and outside consultants
    are eligible to receive awards under the plan. The plan is
    administered by the board of directors, our compensation
    committee or another committee designated by the board of
    directors, provided that a majority of the members of such
    committee are directors who are not also our employees. The
    committee may grant awards, select the recipients and timing of
    awards, and determine the number of shares covered by awards.
Shares issued under our restricted stock plan vest on schedules
    specified in the applicable award agreement, ranging from
    immediate vesting to vesting over a period of 48 months.
    Upon termination for cause or without good reason, all unvested
    shares shall be forfeited. Upon termination without cause, for
    good reason, or for death or disability, unvested shares may
    continue to vest for up to 12 months and are subject to
    repurchase by us at the original purchase price therefor.
    Subject to the repurchase provisions, upon grant of an award, a
    holder has the rights of a stockholder as to both the vested and
    unvested shares.
Upon a "change of control", as defined in the plan,
    unvested shares are accelerated only to the extent provided in
    the applicable award agreement, employment agreement or other
    agreement.
Omnibus Stock
    Incentive Plan
Prior to the closing of this offering, we intend to adopt a new
    omnibus stock incentive plan. After the effective date of the
    new stock incentive plan, we anticipate that we will not make
    any further grants of stock options or restricted stock under
    our prior option plan or our restricted stock plan. However, any
    shares of our common stock reserved for issuance under such
    plans that remain available for issuance and any shares of our
    common stock subject to awards under our such plans that expire,
    terminate or are otherwise surrendered, canceled, forfeited or
    repurchased by us will be added to the number of shares
    available under the new omnibus stock incentive plan, up to a
    specified number of shares.
401(k)
    Retirement Plan
We maintain a 401(k) retirement plan that is intended to be a
    tax-qualified defined contribution plan under
    Section 401(k) of the Internal Revenue Code. In general,
    all of our employees are eligible to participate. The 401(k)
    plan includes a salary deferral arrangement pursuant to which
    participants may elect to reduce their current compensation by
    up to the statutorily prescribed limit, equal to $16,500 in
    2009, and have the amount of the reduction contributed to the
    401(k) plan. We currently match up to 50% of the first 3% of
    base compensation in 401(k) plan contributions by employees who
    are below the "director level"; as such, our named
    executive offices do not receive a match from the company for
    amounts, if any, deferred under the 401(k) plan.
Limitation of
    Liability and Indemnification
As permitted by Delaware law, we plan to adopt provisions in our
    restated certificate of incorporation, which will become
    effective upon the closing of this offering, that limit or
    eliminate the personal liability of our directors. Our restated
    certificate of incorporation limits the liability of directors
    to the maximum extent permitted by Delaware law. Delaware law
    provides that directors of a
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corporation will not be personally liable for monetary damages
    for breaches of their fiduciary duties as directors, except
    liability for:
•
any breach of the director's duty of loyalty to us or our
    stockholders;
•
any act or omission not in good faith or which involves
    intentional misconduct or a knowing violation of law;
•
any unlawful payments related to dividends or unlawful stock
    repurchases or redemptions; or
•
any transaction from which the director derived an improper
    personal benefit.
These limitations do not apply to liabilities arising under
    federal securities laws and do not affect the availability of
    equitable remedies, including injunctive relief or rescission.
    If Delaware law is amended to permit the further elimination or
    limiting of the personal liability of directors, then the
    liability of our directors will be eliminated or limited to the
    fullest extent permitted by Delaware law as so amended.
As permitted by Delaware law, our restated certificate of
    incorporation that will become effective upon the closing of
    this offering also provides that:
•
we will indemnify our directors and officers to the fullest
    extent permitted by law;
•
we may indemnify our other employees and other agents to the
    same extent that we indemnify our officers and directors, unless
    otherwise determined by the board of directors; and
•
we will advance expenses to our directors and officers in
    connection with legal proceedings to the fullest extent
    permitted by law.
The indemnification provisions contained in our restated
    certificate of incorporation that will become effective upon the
    closing of this offering are not exclusive. In addition, prior
    to the closing of this offering, we intend to enter into
    indemnification agreements with each of our directors and
    executive officers. Each indemnification agreement is expected
    to provide that we will indemnify the director or executive
    officer to the fullest extent permitted by law for claims
    arising in his or her capacity as our director, officer,
    employee or agent, provided that he or she acted in good faith
    and in a manner that he or she reasonably believed to be in, or
    not opposed to, our best interests and, with respect to any
    criminal proceeding, had no reasonable cause to believe that his
    or her conduct was unlawful. In the event that we do not assume
    the defense of a claim against a director or executive officer,
    we will be required to advance his or her expenses in connection
    with his or her defense, provided that he or she undertakes to
    repay all amounts advanced if it is ultimately determined that
    he or she is not entitled to be indemnified by us. We believe
    that these provisions and agreements are necessary to attract
    and retain qualified persons as directors and executive officers.
Insofar as indemnification for liabilities arising under the
    Securities Act may be permitted to directors, officers or
    persons controlling our company pursuant to the foregoing
    provisions, we understand that in the opinion of the SEC such
    indemnification is against public policy as expressed in the
    Securities Act and is therefore unenforceable.
In addition, we maintain standard policies of insurance under
    which coverage is provided to our directors and officers against
    losses rising from claims made by reason of breach of duty or
    other wrongful act, and to us with respect to payments which may
    be made by us to such directors and officers pursuant to the
    above indemnification provisions or otherwise as a matter of law.
Rule 10b5-1
Sales Plans
Our directors and executive officers may adopt written plans,
    known as
Rule 10b5-1
plans, in which they will contract with a broker to buy or sell
    shares of our common stock on a periodic basis. Under a
Rule 10b5-1
plan, a broker executes trades pursuant to parameters
    established by the director or officer when entering into the
    plan, without further direction from the director or officer.
    The director or officer may amend or terminate the plan in some
    circumstances. Our directors and executive officers may also buy
    or sell additional shares outside of a
Rule 10b5-1
plan when they are not in possession of material, nonpublic
    information concerning our company.
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RELATED PERSON
    TRANSACTIONS
Since January 1, 2006, we have engaged in the following
    transactions, other than compensation arrangements, with our
    directors, executive officers and holders of more than 5% of our
    voting securities, and certain affiliates of our directors,
    executive officers and 5% stockholders.
Share
    Exchanges
Effective as of December 31, 2008, certain of our
    directors, executive officers and their affiliates agreed to
    exchange 2,398,334 shares of our non-voting common stock
    held by them for 2,398,334 shares of our voting common
    stock. To implement these exchanges, we entered into share
    exchange agreements with these persons in February 2009. These
    shares are subject to the terms and conditions set forth in our
    restricted stock plan, the restricted stock award agreements
    entered into with these persons in connection with the original
    issuance of their shares of non-voting common stock and our
    stockholders' agreement pursuant to which these persons
    have certain registration rights. For a more detailed
    description of these registration rights, see "Description
    of Capital Stock — Registration Rights". Upon the
    closing of this offering, all other outstanding shares of
    non-voting common stock will be converted into common stock. The
    table below sets forth the number of shares of voting common
    stock issued to our directors, executive officers and their
    affiliates in exchange for an equal number of shares of
    non-voting common stock:
Name
Number of Shares
Etienne H. Deffarges
1,166,667
Steven N. Kaplan
41,667
Gregory N. Kazarian
250,000
The Shultz 1989 Family Trust(1)
90,000
Spiegel Family LLC(2)
750,000
John T. Staton Declaration of Trust(3)
100,000
(1)
George P. Shultz, a member of our board of directors, and his
    wife are the beneficiaries of The Shultz 1989 Family Trust.
(2)
Arthur H. Spiegel, III, a member of our board of directors,
    and his wife are the managing members of Spiegel Family LLC, the
    members of which are members of Mr. Spiegel's
    immediate family.
(3)
John T. Staton, our chief financial officer and treasurer, is
    the trustee of John T. Staton Declaration of Trust, the
    beneficiaries of which are members of Mr. Staton's
    immediate family.
Transactions with
    Ascension Health
In October 2004, Ascension Health became our founding customer.
    Since then, in exchange for its initial
start-up
assistance, operational laboratory services and related
    consulting services relative to the services we were developing,
    we have issued common stock and granted warrants to Ascension
    Health, as a result of which Ascension Health is one of our 5%
    stockholders. Ascension Health is the nation's largest
    Catholic and largest nonprofit health system. It is dedicated to
    its mission of serving all, with special attention to those who
    are poor and vulnerable. Our work on behalf of Ascension Health
    is done in compliance with its charity care guidelines and
    billing and collection policies, which recognize the human
    dignity of each individual and our responsibility to treat them
    with respect. A key element of our work for Ascension Health is
    qualifying patients for charity care and identifying potential
    payment sources for patients who are uninsured and underinsured.
    Since January 1, 2006, we have engaged in the following
    transactions with Ascension Health:
Customer Relationship.
In October 2004,
    we and Ascension Health entered into a master services agreement
    with an initial term through November 1, 2007. In December
    2007, we and Ascension Health renewed and extended the agreement
    through December 31, 2012 pursuant to an
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amended and restated master services agreement, which will
    automatically renew for successive one-year terms unless
    terminated by us or Ascension Health upon 180 days prior
    written notice.
Pursuant to the amended and restated master services agreement,
    we provide our revenue cycle service offering to hospitals
    affiliated with Ascension Health that execute separate managed
    service contracts with us and thereby become our customers. In
    rendering our services, we must comply with each hospital's
    policies and procedures relating to billing, collections,
    charity care, personnel, risk management, good corporate
    citizenship and other matters; the ethical and religious
    directives for Catholic healthcare services; and all applicable
    federal, state and local laws and regulations. Ascension
    Health's affiliated hospitals are not obligated to execute
    a managed service contract with us or to use our services. Each
    managed service contract with a hospital affiliated with
    Ascension Health incorporates the provisions of the master
    services agreement and provides that the hospital will be bound
    by all amendments, modifications and waivers that we and
    Ascension Health agree to under the master services agreement.
    With certain exceptions, we are the exclusive provider of
    revenue cycle services to the hospitals affiliated with
    Ascension Health that execute managed service contracts with us,
    and we are required to consult with such hospitals before
    undertaking services for competitors identified by them in their
    contracts with us.
The term of each managed service contract with a hospital
    affiliated with Ascension Health is five years and will
    automatically renew for successive one-year terms unless
    terminated by us or Ascension Health upon 210 days prior
    written notice. By mutual agreement, we and Ascension Health can
    terminate the managed service contracts between us and hospitals
    affiliated with Ascension Health upon 180 days prior
    written notice after the second anniversary of the effective
    date of the applicable contract. Upon 30 days prior written
    notice, Ascension Health can terminate the affected portion of
    any applicable managed service contract if we are unable to
    provide services to a hospital for 30 days out of any
45-day
period due to any cause beyond our reasonable control. We can
    terminate any applicable managed service contract if a hospital
    is excluded from participation in the federal Medicare, state
    Medicaid or other specified federal or state healthcare
    programs, and Ascension Health can terminate the master services
    agreement if we are excluded from participation in any such
    program. A hospital cannot terminate its managed service
    contract with us but it can determine not to renew its contract
    with us. All managed service contracts between us and hospitals
    affiliated with Ascension Health will terminate automatically
    when the master services agreement between us and Ascension
    Health terminates or expires.
The amended and restated master services agreement provides,
    among other things, that:
•
we assume full responsibility for the management and cost of the
    revenue cycle operations of each hospital that executes a
    managed service contract with us, including the payroll and
    benefit costs associated with the hospital's employees
    conducting revenue cycle activities (and who remain hospital
    employees for all purposes), and the agreements and costs
    associated with related third-party services;
•
we are required to supply, at our cost, a sufficient number of
    our own employees on each hospital's premises and the
    technology necessary to implement and manage our services;
•
each hospital must provide us with the facilities, standard
    office furnishings and services, pre-existing revenue cycle
    assets and authority to provide our services;
•
in general, each hospital pays us:
•
base fees equal to a specified amount, subject to annual
    increases under an inflation and wage increase formula;
•
incentive fees based on achieving
agreed-upon
benchmarks; and
•
management and technology fees;
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•
our fees are subject to adjustment in the event specified
    performance milestones are not met, which would result in a
    reduction of future fees payable to us;
•
we are required to offer to Ascension Health's affiliated
    hospitals fees for our services that are at least as low as the
    fees we charge any other similarly-situated customer receiving
    comparable services at comparable volumes;
•
we must implement our services and technology at each hospital
    in a manner that does not cause an unplanned material disruption
    in the hospital's operations;
•
we are required to work to qualify patients for charity care and
    identify potential payment sources for patients who are
    uninsured and underinsured;
•
we are required to maintain patient and employee satisfaction
    levels as compared to specified baseline performance
    measurements;
•
a joint review board consisting of an equal number of senior
    executives from us and Ascension Health oversees the obligations
    and performance of the parties and hears fee disputes and other
    disputes, with any unresolved disputes submitted to binding
    arbitration (provided that hospitals cannot withhold base fees
    for any reason);
•
the parties provide various representations and indemnities
    (subject to a specified cap) to each other;
•
following termination or expiration of the master services
    agreement or any managed service contract between us and a
    hospital affiliated with Ascension Health, if requested by
    Ascension Health, we must:
•
provide termination assistance, in return for reasonable
    compensation, for three months;
•
continue to provide our services for up to one year in return
    for compensation equal to a specified percentage of the
    then-applicable base fees; and
•
provide reasonable assistance to Ascension Health in seeking
    bids from other parties to provide similar services; and
•
following termination or expiration of the agreement, we must
    grant to the applicable hospitals a license to continue using
    all software and tools we used to provide our services, in
    exchange for payments and fees that vary depending on whether
    the agreement is terminated for cause or for any other reason.
The amended and restated master services agreement may not be
    terminated by hospitals affiliated with Ascension Health. The
    agreement may only be terminated by Ascension Health or us in
    the following circumstances:
•
either party may terminate the agreement if the other party
    materially breaches the agreement and fails to cure the breach
    in accordance with specified cure provisions; and
•
Ascension Health may terminate the agreement (1) if we undergo a
    change in control, (2) if Ascension Health receives an opinion
    of qualified legal counsel, after consultation with our
    qualified legal counsel, in which it concludes that the
    agreement presents a material risk of causing Ascension Health
    or any affiliated hospital to violate any applicable laws,
    regulations or rules related to its operations, and that risk
    cannot be reasonably mitigated by the parties following good
    faith consultations and consideration of reasonable amendments
    and modifications to the agreement, or (3) if we become
    excluded from participation in the federal Medicare, state
    Medicaid or other specified federal or state healthcare
    programs, or if we fail to promptly remove from providing
    services to Ascension Health and its affiliates any of our staff
    or related entities that become excluded from participation in
    the federal Medicare, state Medicaid or other specified federal
    or state healthcare programs.
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In 2006, 2007 and 2008 and the six months ended June 30,
    2009, net services revenue from hospitals affiliated with
    Ascension Health were $142.6 million, $214.2 million,
    $281.7 million and $151.6 million, respectively,
    representing 88.7%, 89.0%, 70.7% and 63.6% of our total net
    services revenue in such periods, respectively. As of
    June 30, 2009, we had $24.4 million of accounts
    receivable from hospitals affiliated with Ascension Health and
    one of the hospitals affiliated with Ascension Health had a
    credit of $0.4 million.
Following completion of this offering, Ascension Health will
    own     % of our outstanding common
    stock. See "Principal and Selling Stockholders".
Initial Stock Issuance and Protection Warrant
    Agreement.
In October and November 2004, we
    issued 902,374 shares of our common stock to Ascension
    Health, then representing a 5% ownership interest in our company
    on a fully-diluted basis, and entered into a protection warrant
    agreement, under which we granted Ascension Health the right to
    purchase additional shares of our common stock from time to time
    for $0.01 per share when Ascension Health's ownership
    interest in our company declines below 5% due to our issuance of
    additional stock or rights to purchase stock. The protection
    warrant agreement, and all purchase rights granted thereunder,
    expire on the closing of this offering. In 2006, 2007, 2008 and
    the six months ended June 30, 2009, we granted Ascension
    Health the right to purchase 15,752, 58,175, 23,261 and
    25,837 shares of our common stock for $0.01 per share,
    respectively, pursuant to the protection warrant agreement. In
    2007, 2008 and the six months ended June 30, 2009,
    Ascension Health purchased 213,100, 66,652 and
    16,758 shares of our common stock, respectively, from us
    for $0.01 per share, pursuant to the protection warrant
    agreement. As of June 30, 2009, Ascension Health has the
    right to purchase an additional 23,863 shares pursuant to
    the protection warrant agreement at any time prior to the
    closing of this offering.
Supplemental Warrant
    Agreement.
Pursuant to a supplemental warrant
    agreement that became effective in November 2004, Ascension
    Health had the right to purchase up to 902,374 shares of
    our common stock based upon the achievement of specified
    milestones relating to its sales and marketing assistance. In
    May 2007, we amended and restated the supplemental warrant
    agreement to reduce the number of shares covered by the
    agreement to 446,190 shares. In November 2007, we further
    amended and restated the supplemental warrant agreement to
    modify the purchase right milestones. Under the supplemental
    warrant agreement, the purchase price is equal to the most
    recent common stock-equivalent price per share paid in a capital
    raising transaction or, if we have not had a capital raising
    transaction within the preceding six months, the exercise price
    of the employee stock options we have most recently granted. All
    purchase rights under the supplemental warrant agreement will
    expire on the closing of this offering. Based on Ascension
    Health's achievement of specified milestones relating to
    its sales and marketing assistance, Ascension Health earned the
    right to purchase all 446,190 shares under the supplemental
    warrant agreement. The table below summarizes Ascension
    Health's purchase rights under the supplemental warrant
    agreement:
Date Earned
Number of Shares
Purchase Price Per
    Share
December 2007
223,095
$
17.36
March 2008
111,548
$
40.17
March 2009
111,547
$
51.05
Ascension Health may purchase these shares for cash or in a
    cashless exercise transaction in which Ascension Health receives
    a smaller number of shares (based on the difference between the
    exercise price and the fair market value of the underlying
    shares on the date of exercise).
Stock Sale.
Concurrently with the
    amendment and restatement of the supplemental warrant agreement
    described above in May 2007, we sold 669,284 shares of our
    common stock to Ascension Health for $8.20 per share, which was
    equal to the fair market value of the common stock at that time,
    for an aggregate purchase price of $5,488,128.
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Registration
    Rights
We are a party to a stockholders' agreement with certain of
    our stockholders, including certain of our directors, executive
    officers and holders of more than 5% of our voting securities
    and their affiliates. Pursuant to the stockholders'
    agreement, after the contractual
lock-up
agreements expire, these stockholders will have the right to
    require us to register all or a portion of their shares under
    the Securities Act under specific circumstances and subject to
    certain limitations. For a more detailed description of these
    registration rights, see "Description of Capital
    Stock — Registration Rights".
Management
    Investments in Our Company
We have not sold any shares of preferred stock since
    January 1, 2006. Between August 2003 and December 2005, we
    raised approximately $16.1 million from the sale of
    preferred stock. Each of our four executive officers made one or
    more cash investments in our company on the same terms as
    applicable to the other investors in these preferred stock
    financings. The cash investments of Ms. Tolan and
    Mr. Deffarges together represented more than 10% of the
    aggregate proceeds from our preferred stock financings.
Certain
    Employment Arrangements
We employ Kyle Hupach, the
brother-in-law
of Gregory N. Kazarian, our senior vice president, general
    counsel and secretary, as a director of revenue cycle
    operations. Mr. Hupach's current annual base salary is
    $119,000, and he also participates in our standard employee
    benefits package. In 2008, Mr. Hupach's total
    compensation, including salary, bonus and the amount of
    share-based compensation expense that we recognized for
    financial statement reporting purposes for stock options
    previously granted to him, was $156,670.
Indemnification
Our restated certificate of incorporation that will be in effect
    upon the closing of this offering provides that we will
    indemnify our directors and officers to the fullest extent
    permitted by Delaware law. In addition, prior to the closing of
    this offering, we intend to enter into indemnification
    agreements with each of our directors and executive officers
    that may be broader in scope than the specific indemnification
    provisions contained in the Delaware General Corporation Law.
    For more information regarding these agreements, see
    "Management — Limitation of Liability and
    Indemnification" and "Description of Capital
    Stock — Limitation of Liability and Indemnification of
    Officers and Directors".
Policies and
    Procedures for Related Person Transactions
Prior to the closing of this offering, our board of directors
    intends to adopt a written related person transaction policy to
    set forth policies and procedures for the review and approval or
    ratification of related person transactions. This policy will
    cover any transaction, arrangement or relationship, or any
    series of similar transactions, arrangements or relationships,
    in which we were or are to be a participant, the amount involved
    exceeds $120,000, and a related person had or will have a direct
    or indirect material interest, including, without limitation,
    purchases of goods or services by or from the related person or
    entities in which the related person has a material interest,
    indebtedness, guarantees of indebtedness, and employment by us
    of a related person. Our related person transaction policy will
    contain exceptions for any transaction or interest that is not
    considered a related person transaction under SEC rules as in
    effect from time to time.
Any related person transaction proposed to be entered into by us
    must be reported to our general counsel and will be reviewed and
    approved by the audit committee in accordance with the terms of
    the policy, prior to effectiveness or consummation of the
    transaction whenever practicable. If our general counsel
    determines that advance approval of a related person transaction
    is not practicable under the circumstances, the audit committee
    will review and, in its discretion, may ratify the related
    person transaction at the next meeting of the audit committee.
    Alternatively, our general
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counsel may present a related person transaction arising in the
    time period between meetings of the audit committee to the chair
    of the audit committee, who will review and may approve the
    related person transaction, subject to ratification by the audit
    committee at the next meeting of the audit committee.
In addition, any related person transaction previously approved
    by the audit committee or otherwise already existing that is
    ongoing in nature will be reviewed by the audit committee
    annually to ensure that such related person transaction has been
    conducted in accordance with the previous approval granted by
    the audit committee, if any, and that all required disclosures
    regarding the related person transaction are made.
Transactions involving compensation of executive officers will
    be reviewed and approved by the compensation committee in the
    manner specified in the charter of the compensation committee.
A related person transaction reviewed under this policy will be
    considered approved or ratified if it is authorized by the audit
    committee in accordance with the standards set forth in the
    policy after full disclosure of the related person's
    interests in the transaction. As appropriate for the
    circumstances, the audit committee will review and consider:
•
the related person's interest in the related person
    transaction;
•
the approximate dollar value of the amount involved in the
    related person transaction;
•
the approximate dollar value of the amount of the related
    person's interest in the transaction without regard to the
    amount of any profit or loss;
•
whether the transaction was undertaken in the ordinary course of
    business of our company;
•
whether the transaction with the related person is proposed to
    be, or was, entered into on terms no less favorable to us than
    the terms that could have been reached with an unrelated third
    party;
•
the purpose of, and the potential benefits to us of, the
    transaction; and
•
any other information regarding the related person transaction
    or the related person in the context of the proposed transaction
    that would be material to investors in light of the
    circumstances of the particular transaction.
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The audit committee will review all relevant information
    available to it about the related person transaction. The audit
    committee may approve or ratify the related person transaction
    only if the audit committee determines that, under all of the
    circumstances, the transaction is in, or is not inconsistent
    with, our best interests. The audit committee may, in its sole
    discretion, impose such conditions as it deems appropriate on us
    or the related person in connection with approval of the related
    person transaction.
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PRINCIPAL AND
    SELLING STOCKHOLDERS
The following table sets forth information regarding the
    beneficial ownership of our common stock as of June 30,
    2009, by:
•
each of our directors;
•
each of our named executive officers;
•
each person, or group of affiliated persons, who is known by us
    to beneficially own more than 5% of our common stock;
•
all of our directors and executive officers as a group; and
•
each selling stockholder.
Beneficial ownership is determined in accordance with the rules
    of the SEC. These rules generally attribute beneficial ownership
    of securities to persons who possess sole or shared voting power
    or investment power with respect to those securities and include
    shares of common stock issuable upon the exercise of stock
    options that are immediately exercisable or exercisable within
    60 days after June 30, 2009. Except as otherwise
    indicated, all of the shares reflected in the table are shares
    of common stock and all persons listed below have sole voting
    and investment power with respect to the shares beneficially
    owned by them, subject to applicable community property laws.
    The information is not necessarily indicative of beneficial
    ownership for any other purpose.
Percentage ownership calculations for beneficial ownership prior
    to this offering are based on 20,803,641 shares outstanding
    as of June 30, 2009, assuming (1) the automatic
    conversion of all outstanding shares of non-voting common stock
    into shares of common stock upon the closing of this offering,
    (2) the automatic conversion of all outstanding shares of
    convertible preferred stock into shares of common stock upon the
    closing of this offering and (3) the assumed issuance
    of           shares
    of common stock upon exercise of warrants that will be cancelled
    if not exercised prior to this offering. Percentage ownership
    calculations for beneficial ownership after this offering
    reflect the shares we are offering hereby and the issuance
    of           shares
    of common stock to FT Partners contemporaneously with the
    closing of this offering, based on an assumed initial public
    offering price of $      per share, the
    midpoint of the estimated price range shown on the cover of this
    prospectus. Except as otherwise indicated in the table below,
    addresses of named beneficial owners are in care of Accretive
    Health, Inc., 401 North Michigan Avenue, Suite 2700,
    Chicago, Illinois 60611.
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In computing the number of shares of common stock beneficially
    owned by a person and the percentage ownership of that person,
    we deemed outstanding (1) shares of common stock subject to
    options or warrants held by that person that are immediately
    exercisable or exercisable within 60 days of June 30,
    2009 and (2) shares of common stock to be received prior to
    the closing of this offering pursuant to the distribution of
    shares from an entity pursuant to which certain directors and
    executive officers previously invested in our company. We did
    not deem these shares outstanding, however, for the purpose of
    computing the percentage ownership of any other person.
    Beneficial ownership representing less than 1% is denoted with
    an asterisk (*).
Shares Beneficially Owned
Shares Beneficially Owned
Prior to Offering
Number of
After Offering
Name of Beneficial
    Owner
Number
Percentage
Shares Offered
Number
Percentage
5% Stockholders
Accretive Investors SBIC, L.P.(1)
5,333,921
25.6
%
FW Oak Hill Accretive Healthcare Investors, L.P.(2)
4,445,087
21.4
%
Ascension Health(3)
2,339,538
11.0
%
Executive Officers and Directors
Mary A. Tolan(4)
3,553,167
17.1
%
John T. Staton(5)
319,303
1.5
%
Etienne H. Deffarges(6)
1,416,443
6.7
%
Gregory N. Kazarian(7)
293,384
1.4
%
Edgar M. Bronfman, Jr.(8)
—
—
J. Michael Cline(9)
5,333,921
25.6
%
Steven N. Kaplan(10)
104,098
*
Denis J. Nayden(11)
—
—
George P. Shultz(12)
181,368
*
Arthur H. Spiegel, III(13)
1,038,724
4.9
%
Mark A. Wolfson(14)
—
—
All current executive officers and directors as a group
    (11 persons)(15)
12,240,408
56.3
%
Other Selling Stockholders
(1)
Accretive Associates SBIC, LLC is
    the general partner of Accretive Investors SBIC, L.P.
    Mr. Cline is the managing member of Accretive Associates
    SBIC, LLC, and may be deemed to have sole voting and investment
    power with respect to the shares held by Accretive Investors
    SBIC, L.P. The address of Accretive Investors SBIC, L.P. is
c/o Accretive,
LLC, 51 Madison Avenue, 31st Floor, New York, New York 10010.
(2)
Group VI 31, LLC is the general
    partner of FW Oak Hill Accretive Healthcare Investors, L.P. (the
    "Oak Hill Partnership") The sole member of Group VI
    31, LLC is J. Taylor Crandall, who disclaims beneficial
    ownership of such shares, except to the extent of his pecuniary
    interest therein. J. Taylor Crandall exercises voting and
    investment power with respect to such shares. The address of the
    Oak Hill Partnership is 201 Main Street, Suite 3100,
    Fort Worth, Texas 76102. Messrs. Nayden and Wolfson
    are limited partners of the Oak Hill Partnership, and
    Mr. Wolfson is a Vice President and Assistant Secretary of
    Group VI 31, LLC.
(3)
Ascension Health is a Missouri
    not-for-profit corporation. Anthony J. Speranzo, Ascension
    Health's senior vice president and chief financial officer,
    has sole voting and investment power with respect to the shares
    held by Ascension Health. Mr. Speranzo disclaims beneficial
    ownership of such shares. Includes warrants to purchase
    471,370 shares exercisable within 60 days of
    June 30, 2009. The address of Ascension Health is 4600
    Edmundson Road, St. Louis, Missouri 63134.
(4)
Includes 825,000 shares held
    by family trusts. Members of Ms. Tolan's immediate
    family share voting and investment power with respect to the
    shares held by these trusts.
(5)
Consists of 100,000 shares
    held by John T. Staton Declaration of Trust, 20,008 shares
    of our common stock to be received by John T. Staton Declaration
    of Trust pursuant to the investment distribution referred to
    above, and 199,295 shares subject to options exercisable
    within 60 days of June 30, 2009, of which
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12,470 shares will vest within
    60 days of June 30, 2009. The beneficiaries of John T.
    Staton Declaration of Trust are members of
    Mr. Staton's immediate family. Mr. Staton is the
    trustee of such trust and exercises sole voting and investment
    power with respect to the shares held by the trust.
(6)
Includes 249,776 shares of our
    common stock to be received pursuant to the investment
    distribution referred to above.
(7)
Includes 43,384 shares of our
    common stock to be received pursuant to the investment
    distribution referred to above.
(8)
Mr. Bronfman is a member of
    Accretive Associates SBIC, LLC, which is the general partner of
    Accretive Investors SBIC, L.P., but exercises no voting or
    investment power with respect to the shares held by Accretive
    Investors SBIC, L.P. Mr. Bronfman disclaims beneficial
    ownership of the shares held by Accretive Investors SBIC, L.P.
(9)
Consists of the shares described in
    note (1) above. Mr. Cline is the managing member of
    Accretive Associates SBIC, LLC, which is the general partner of
    Accretive Investors SBIC, L.P. and, as such, may be deemed to
    have sole voting and investment power with respect to the shares
    described in note (1) above.
(10)
Includes 62,431 shares of our
    common stock to be received pursuant to the investment
    distribution referred to above.
(11)
See note (2) above.
    Mr. Nayden is not deemed to have voting or investment power
    with respect to any shares held by the Oak Hill Partnership as a
    limited partner.
(12)
Consists of 90,000 shares held
    by The Shultz 1989 Family Trust, of which Mr. Shultz and
    his wife are the beneficiaries, and 91,368 shares of our
    common stock to be received by The Shultz 1989 Family Trust
    pursuant to the investment distribution referred to above.
    George T. Argyris is the trustee for the trust and exercises
    sole voting and investment power with respect to the shares held
    by the trust. Mr. Argyris disclaims beneficial ownership of
    such shares.
(13)
Consists of 750,000 shares
    held by Spiegel Family LLC, the members of which are members of
    Mr. Spiegel's immediate family, and
    288,724 shares of our common stock to be received by
    Spiegel Family LLC pursuant to the investment distribution
    referred to above. Mr. Spiegel and his wife are the
    managing members of Spiegel Family LLC and exercise shared
    voting and investment power with respect to such shares.
(14)
See note (2) above.
    Mr. Wolfson is not deemed to have voting or investment
    power with respect to any shares held by the Oak Hill
    Partnership as a limited partner or as a Vice President or
    Assistant Secretary of Group VI 31, LLC.
(15)
Includes the shares described in
    notes (1) and (2) above, 755,691 shares of our
    common stock to be received pursuant to the investment
    distribution referred to above, and 199,295 shares subject
    to options exercisable within 60 days of June 30,
    2009, of which 12,470 shares will vest within 60 days
    of June 30, 2009.
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DESCRIPTION OF
    CAPITAL STOCK
General
Following the closing of this offering, our authorized capital
    stock will consist
    of           shares
    of common stock, par value $0.01 per share, and
    5,000,000 shares of preferred stock, par value $0.01 per
    share, all of which preferred stock will be undesignated.
The following description of our capital stock and provisions of
    our certificate of incorporation and bylaws are summaries and
    are qualified by reference to the restated certificate of
    incorporation and the amended and restated bylaws that will be
    in effect upon the closing of this offering. Copies of these
    documents have been filed with the SEC as exhibits to our
    registration statement, of which this prospectus forms a part.
    The descriptions of the common stock and preferred stock reflect
    changes to our capital structure that will occur upon the
    closing of this offering.
Common
    Stock
As of June 30, 2009, there were 20,803,641 shares of
    our common stock outstanding, held of record by 84 stockholders,
    assuming the conversion of all outstanding shares of convertible
    preferred stock into common stock and the conversion of all
    outstanding shares of non-voting common stock into common stock.
The holders of our common stock are entitled to one vote for
    each share held on all matters submitted to a vote of the
    stockholders and do not have any cumulative voting rights.
    Holders of our common stock are entitled to receive
    proportionally any dividends declared by our board of directors
    out of funds legally available therefor, subject to any
    preferential dividend or other rights of any then outstanding
    preferred stock.
In the event of our liquidation or dissolution, holders of our
    common stock are entitled to share ratably in all assets
    remaining after payment of all debts and other liabilities,
    subject to the prior rights of any then outstanding preferred
    stock. Holders of our common stock have no preemptive,
    subscription, redemption or conversion rights. All outstanding
    shares of our common stock are validly issued, fully paid and
    nonassessable. The shares to be issued by us in this offering
    will be, when issued and paid for, validly issued, fully paid
    and nonassessable.
The rights, preferences and privileges of holders of our common
    stock are subject to, and may be adversely affected by, the
    rights of holders of shares of any series of preferred stock
    that we may designate and issue in the future.
Preferred
    Stock
Under the terms of our certificate of incorporation, our board
    of directors is authorized to issue shares of preferred stock in
    one or more series without stockholder approval. Our board of
    directors has the discretion to determine the rights,
    preferences, privileges and restrictions, including voting
    rights, dividend rights, conversion rights, redemption
    privileges and liquidation preferences, of each series of
    preferred stock, any or all of which may be greater than or
    senior to the rights of the common stock. The issuance of
    preferred stock could adversely affect the voting power of
    holders of common stock and reduce the likelihood that such
    holders will receive dividend payments or payments on
    liquidation. In certain circumstances, an issuance of preferred
    stock could have the effect of decreasing the market price of
    our common stock.
Authorizing our board of directors to issue preferred stock and
    determine its rights and preferences has the effect of
    eliminating delays associated with a stockholder vote on
    specific issuances. The issuance of preferred stock, while
    providing flexibility in connection with possible acquisitions,
    future financings and other corporate purposes, could have the
    effect of making it more difficult for a third party to acquire,
    or could discourage a third party from seeking to acquire, a
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majority of our outstanding stock. Upon the closing of this
    offering, there will be no shares of preferred stock
    outstanding, and we have no present plans to issue any shares of
    preferred stock.
Stock
    Options
As of June 30, 2009, 2,440,885 shares of common stock
    were issuable upon the exercise of stock options outstanding and
    exercisable at a weighted-average exercise price of $21.59 per
    share, of which 1,054,930 shares with a weighted-average
    exercise price of $8.52 per share would be vested if purchased
    upon exercise of these options as of June 30, 2009.
Warrants
As of June 30, 2009, 470,053 shares of voting common
    stock were issuable upon the exercise of warrants outstanding
    and exercisable at a weighted-average exercise price of $29.77
    per share and 833,334 shares of non-voting common stock
    were issuable upon the exercise of warrants outstanding and
    exercisable at a weighted-average exercise price of $1.12 per
    share. All of these warrants may be exercised by paying the
    exercise price in cash or pursuant to a cashless exercise
    feature based on the fair market value per share of our common
    stock.
Upon the closing of this offering, all outstanding warrants to
    purchase shares of voting common stock that are not exercised
    prior to this offering will be cancelled. If all of these
    unexercised warrants to purchase voting common stock are
    exercised on a cashless basis upon consummation of this
    offering, assuming an initial public offering price of
    $     , the midpoint of the estimated
    price range shown on the cover of this prospectus, we would
    issue an aggregate
    of           shares
    of common stock and receive no cash proceeds. If all of these
    unexercised warrants to purchase voting common stock are
    exercised for cash, we would issue an aggregate
    of           shares
    of common stock for cash proceeds of
    $     .
Upon the closing of this offering and the automatic conversion
    of all outstanding shares of non-voting common stock into shares
    of voting stock, any warrants to purchase non-voting common
    stock that are not exercised prior to this offering will remain
    outstanding and will be warrants to purchase shares of voting
    common stock.
Registration
    Rights
We have entered into a stockholders' agreement with certain
    of our stockholders. After the completion of this offering and
    the sale by the selling stockholders of the shares of common
    stock offered by them hereby, holders of an aggregate
    of           shares
    of outstanding common stock and shares issuable upon exercise of
    outstanding warrants will have the right to require us to
    register these shares under the Securities Act under specified
    circumstances. After registration pursuant to these rights,
    these shares will become freely tradable by non-affiliates
    without restriction under the Securities Act. The following
    description of these registration rights is intended as a
    summary only and is qualified in its entirety by reference to
    the stockholders' agreement, which is filed as an exhibit
    to the registration statement of which this prospectus forms a
    part.
Demand Registration Rights.
Beginning
    181 days after the effective date of the registration
    statement of which this prospectus forms a part, subject to the
    contractual
lock-up
agreements, the holders of at least 50% of our shares of common
    stock having registration rights under the stockholders'
    agreement, provided such shares represent at least 25% of our
    outstanding common stock on a fully-diluted basis, may demand
    that we register all or a portion of their shares under the
    Securities Act, subject to certain limitations. In addition,
    each party to the stockholders' agreement holding more than
    12% of our common stock on an as-converted basis as of
    September 25, 2009 may demand on one occasion that we
    register all or a portion of its shares under the Securities
    Act, provided that the shares to be registered have an aggregate
    market value of at least $50 million or represent at least
    5% of our then outstanding common stock. We are not required to
    file (1) a registration statement less than six months
    after the effective date of a registration statement effected
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pursuant to this requirement of the stockholders' agreement
    or (2) more than five registration statements pursuant to
    this requirement under the stockholders' agreement. In
    addition, we may not register any shares of our common stock
    held by a stockholder who is not a party to the
    stockholders' agreement in a registration statement
    requested to be filed pursuant to the terms of the
    stockholders' agreement.
Incidental Registration Rights.
If at
    any time we propose to register shares of our common stock under
    the Securities Act, other than a registration statement on
Form S-4
or
Form S-8,
the holders of registrable shares under the stockholders'
    agreement will be entitled to notice of our intention to file a
    registration statement and, subject to certain exceptions, have
    the right to require us to use best efforts to register all or a
    portion of the registrable shares held by them. In the event
    that any registration in which the holders of registrable shares
    participate pursuant to the stockholders' agreement is an
    underwritten public offering, the number of registrable shares
    to be included may, in specified circumstances, be limited due
    to market conditions.
Pursuant to the stockholders' agreement, we are required to
    pay all registration fees and expenses and indemnify each
    participating stockholder with respect to each registration of
    registrable shares that is effected.
Anti-Takeover
    Effects of Delaware Law and Our Charter and Bylaws
Delaware law, our certificate of incorporation and our bylaws
    contain provisions that could have the effect of delaying,
    deferring or discouraging another party from acquiring control
    of us. These provisions, which are summarized below, are
    expected to discourage coercive takeover practices and
    inadequate takeover bids. These provisions are also designed to
    encourage persons seeking to acquire control of us to first
    negotiate with our board of directors.
Classified
    Board; Removal of Directors
Our certificate of incorporation and bylaws divide our board of
    directors into three classes with staggered three-year terms. In
    addition, a director may be removed only for cause and only by
    the affirmative vote of the holders of at least two-thirds of
    the voting power of our outstanding common stock. Any vacancy on
    our board of directors, including a vacancy resulting from an
    enlargement of our board of directors, may be filled only by
    vote of a majority of our directors then in office. The
    classification of our board of directors and the limitations on
    the removal of directors and filling of vacancies could make it
    more difficult for a third party to acquire, or discourage a
    third party from seeking to acquire, control of our company.
Stockholder
    Action by Written Consent; Special Meetings
Our certificate of incorporation provides that any action
    required or permitted to be taken by our stockholders must be
    effected at a duly called annual or special meeting of such
    holders and may not be effected by any consent in writing by
    such holders. Our certificate of incorporation and bylaws also
    provide that, except as otherwise required by law, special
    meetings of our stockholders can only be called by our chairman
    of the board, our chief executive officer or our board of
    directors.
Advance Notice
    Requirements for Stockholder Proposals
Our bylaws establish an advance notice procedure for stockholder
    proposals to be brought before an annual meeting of
    stockholders, including proposed nominations of persons for
    election to the board of directors. Stockholders at an annual
    meeting may only consider proposals or nominations specified in
    the notice of meeting or brought before the meeting by or at the
    direction of the board of directors or by a stockholder of
    record on the record date for the meeting, who is entitled to
    vote at the meeting and who has delivered timely written notice
    in proper form to our secretary of the stockholder's
    intention to bring such business before the meeting. This
    written notice must contain certain information specified in our
    bylaws. These provisions could have the effect of delaying until
    the
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next stockholder meeting stockholder actions that are favored by
    the holders of a majority of our outstanding voting securities.
Delaware
    Business Combination Statute
We are subject to Section 203 of the Delaware General
    Corporation Law. Subject to certain exceptions, Section 203
    prevents a publicly-held Delaware corporation from engaging in a
    "business combination" with any "interested
    stockholder" for three years following the date that the
    person became an interested stockholder, unless the interested
    stockholder attained such status with the approval of our board
    of directors or unless the business combination is approved in a
    prescribed manner. A "business combination" includes,
    among other things, a merger or consolidation involving us and
    the "interested stockholder" and the sale of more than
    10% of our assets. In general, an "interested
    stockholder" is any entity or person beneficially owning
    15% or more of our outstanding voting stock and any entity or
    person affiliated with or controlling or controlled by such
    entity or person.
Amendment of
    Certificate of Incorporation and Bylaws
The Delaware General Corporation Law provides generally that the
    affirmative vote of a majority of the shares entitled to vote on
    any matter is required to amend a corporation's certificate
    of incorporation or bylaws, unless a corporation's
    certificate of incorporation or bylaws, as the case may be,
    requires a greater percentage. Our bylaws may be amended or
    repealed by a majority vote of our board of directors or by the
    affirmative vote of the holders of at least two-thirds of the
    votes which all our stockholders would be entitled to cast in
    any election of directors. In addition, the affirmative vote of
    the holders of at least two-thirds of the votes which all our
    stockholders would be entitled to cast in any election of
    directors is required to amend or repeal or to adopt any
    provisions inconsistent with any of the provisions of our
    certificate of incorporation described above under
    "— Classified Board; Removal of Directors"
    and "— Stockholder Action by Written Consent;
    Special Meetings".
Limitation of
    Liability and Indemnification of Officers and
    Directors
Our restated certificate of incorporation limits the personal
    liability of directors for breach of fiduciary duty to the
    maximum extent permitted by the Delaware General Corporation
    Law. Our restated certificate of incorporation also provides
    that no director will have personal liability to us or to our
    stockholders for monetary damages for breach of fiduciary duty
    as a director. However, these provisions do not eliminate or
    limit the liability of any of our directors for:
•
any breach of the director's duty of loyalty to us or our
    stockholders;
•
any act or omission not in good faith or which involves
    intentional misconduct or a knowing violation of law;
•
any unlawful payments related to dividends or unlawful stock
    repurchases or redemptions; or
•
any transaction from which the director derived an improper
    personal benefit.
Any amendment to or repeal of these provisions will not
    eliminate or reduce the effect of these provisions in respect of
    any act or failure to act, or any cause of action, suit or claim
    that would accrue or arise prior to any amendment or repeal or
    adoption of an inconsistent provision. If the Delaware General
    Corporation Law is amended to permit the further elimination or
    limiting of the personal liability of directors, then the
    liability of our directors will be eliminated or limited to the
    fullest extent permitted by the Delaware General Corporation Law
    as so amended.
In addition, our restated certificate of incorporation provides
    that we must indemnify our directors and officers and we must
    advance expenses, including attorneys' fees, to our
    directors and officers in connection with legal proceedings,
    subject to limited exceptions.
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Authorized but
    Unissued Shares
The authorized but unissued shares of common stock and preferred
    stock are available for future issuance without stockholder
    approval, subject to any limitations imposed by the listing
    standards of The New York Stock Exchange. These additional
    shares may be used for a variety of corporate finance
    transactions, acquisitions and employee benefit plans. The
    existence of authorized but unissued and unreserved common stock
    and preferred stock could make it more difficult or discourage
    an attempt to obtain control of us by means of a proxy contest,
    tender offer, merger or otherwise.
Transfer Agent
    and Registrar
Prior to the closing of this offering, we will appoint a
    transfer agent and registrar for our common stock.
New York Stock
    Exchange
We intend to apply to have our common stock listed on the New
    York Stock Exchange under the symbol "AH".
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SHARES ELIGIBLE
    FOR FUTURE SALE
Prior to this offering, there has been no public market for our
    common stock, and a liquid public trading market for our common
    stock may not develop or be sustained after this offering.
    Future sales of significant amounts of our common stock,
    including shares issued upon exercise of outstanding options or
    warrants or in the public market after this offering, or the
    anticipation of those sales, could adversely affect the public
    market prices prevailing from time to time and could impair our
    ability to raise capital through sales of our equity securities.
    We intend to apply to have our common stock listed on The New
    York Stock Exchange under the symbol "AH".
Upon the closing of this offering, we will have outstanding an
    aggregate
    of           shares
    of common stock, assuming no exercise by the underwriters of
    their option to purchase additional shares and no exercise of
    outstanding options or warrants. Of these shares, all shares
    sold in this offering will be freely tradable without
    restriction or further registration under the Securities Act,
    except for any shares purchased by our "affiliates",
    as that term is defined in Rule 144 under the Securities
    Act, whose sales would be subject to the Rule 144 resale
    restrictions described below, other than the holding period
    requirement.
The
    remaining           shares
    of common stock will be "restricted securities", as
    that term is defined in Rule 144 under the Securities Act.
    These restricted securities are eligible for public sale only if
    they are registered under the Securities Act or if they qualify
    for an exemption from registration under Rules 144 or 701
    under the Securities Act, which are summarized below.
Subject to the
lock-up
agreements described below and the provisions of Rules 144
    and 701 under the Securities Act, these restricted securities
    will be available for sale in the public market as follows:
Shares Eligible
Date Available for
    Sale
for Sale
Comment
Date of prospectus
Shares sold in the offering and shares saleable under Rule 144
    that are not subject to a lock-up
90 days after date of prospectus
Shares saleable under Rules 144 and 701 that are not subject to
    a lock-up
180 days after date of prospectus
Lock-up released; shares saleable under Rules 144 and 701
In addition, of the 2,440,885 shares of our common stock
    that were subject to stock options outstanding as of
    June 30, 2009, 1,054,930 shares would be vested if
    purchased upon exercise of these options and would be eligible
    for sale subject to the
lock-up
agreements and securities laws described below. The
    1,304,704 shares of our common stock that were subject to
    warrants outstanding as of June 30, 2009 were exercisable
    as of June 30, 2009 and, assuming a cashless exercise,
    these shares will be eligible for sale subject to the
lock-up
agreements and securities laws described below.
Rule 144
Affiliate
    Resales of Restricted Securities
In general, beginning 90 days after the effective date of
    the registration statement of which this prospectus is a part, a
    person who is an affiliate of ours, or who was an affiliate at
    any time during the 90 days before a sale, who has
    beneficially owned shares of our common stock for at least six
    months would be entitled to sell in "broker's
    transactions" or certain "riskless principal
    transactions" or
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to market makers, a number of shares within any three-month
    period that does not exceed the greater of:
•
1% of the number of shares of our common stock then outstanding,
    which will equal
    approximately           shares
    immediately after this offering; or
•
the average weekly trading volume in our common stock on the
    NYSE during the four calendar weeks preceding the filing of a
    notice on Form 144 with respect to such sale.
Affiliate resales under Rule 144 are also subject to the
    availability of current public information about us. In
    addition, if the number of shares being sold under Rule 144
    by an affiliate during any three-month period exceeds
    5,000 shares or has an aggregate sale price in excess of
    $50,000, the seller must file a notice on Form 144 with the
    SEC and the NYSE concurrently with either the placing of a sale
    order with the broker or the execution directly with a market
    maker.
Non-Affiliate
    Resales of Restricted Securities
In general, beginning 90 days after the effective date of
    the registration statement of which this prospectus is a part, a
    person who is not an affiliate of ours at the time of sale, and
    has not been an affiliate at any time during the three months
    preceding a sale, and who has beneficially owned shares of our
    common stock for at least six months but less than a year, is
    entitled to sell such shares subject only to the availability of
    current public information about us. If such person has held our
    shares for at least one year, such person can resell under
    Rule 144(b)(1) without regard to any Rule 144
    restrictions, including the
90-day
public company requirement and the current public information
    requirement.
Non-affiliate resales are not subject to the manner of sale,
    volume limitation or notice filing provisions of Rule 144.
Rule 701
In general, under Rule 701, any of our employees,
    directors, officers, consultants or advisors who purchased
    shares from us in connection with a compensatory stock or option
    plan or other written agreement entered into before the
    effective date of this offering is entitled to sell such shares
    90 days after this offering in reliance on Rule 144.
Lock-up
Agreements
Our officers and directors and the holders of substantially all
    of our outstanding shares of common stock have agreed with the
    underwriters, subject to certain exceptions, not to offer, sell,
    contract to sell, pledge, grant any option to purchase, make any
    short sale or otherwise dispose of any shares of common stock,
    options or warrants to purchase shares of common stock or
    securities convertible into, exchangeable for or that represent
    the right to receive shares of common stock, whether now owned
    or hereafter acquired, make any demand for, or exercise any
    right with respect to, the registration of any shares of common
    stock or any securities convertible into or exercisable or
    exchangeable for shares of common stock during the period from
    the date of this prospectus continuing through the date
    180 days after the date of this prospectus, as modified as
    described below, except with the prior written consent of
    Goldman, Sachs & Co. and Credit Suisse Securities
    (USA) LLC, on behalf of the underwriters.
The
180-day
restricted period will be automatically extended under the
    following circumstances:
•
if, during the last 17 days of the
180-day
restricted period, we issue an earnings release or announce
    material news or a material event, the restrictions described in
    the preceding paragraph will continue to apply until the
    expiration of the
18-day
period beginning on the issuance of the earnings release or the
    announcement of the material news or material event; or
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•
if, prior to the expiration of the
180-day
restricted period, we announce that we will release earnings
    results during the
16-day
period beginning on the last day of the
180-day
period, the restrictions described in the preceding paragraph
    will continue to apply until the expiration of the
18-day
period beginning on the issuance of the earnings release.
Goldman, Sachs & Co. and Credit Suisse Securities
    (USA) LLC currently do not anticipate shortening or waiving any
    of the
lock-up
agreements and do not have any pre-established conditions for
    such modifications or waivers. Goldman, Sachs & Co.
    and Credit Suisse Securities (USA) LLC may, however, with the
    approval of our board of directors, release for sale in the
    public market all or any portion of the shares subject to the
lock-up
agreement.
Stock Options and
    Warrants
As of June 30, 2009, 2,440,885 shares of common stock
    were issuable upon the exercise of stock options outstanding, of
    which 1,054,930 shares would be vested if purchased upon
    exercise of these options as of June 30, 2009. Following
    this offering, we intend to file registration statements on
Form S-8
under the Securities Act to register all of the shares of common
    stock subject to outstanding options and options and other
    awards issuable pursuant to our 2003 stock plan.
As of June 30, 2009, 470,053 shares of voting common
    stock and 833,334 shares of non-voting common stock were
    issuable upon the exercise of warrants outstanding. Any shares
    purchased by our non-affiliates pursuant to the cashless
    exercise feature of our warrants will be freely tradable under
    Rule 144(b)(1), subject to the
180-day
lock-up
period described above. Upon the closing of this offering, all
    outstanding warrants to purchase shares of voting common stock
    that are not exercised prior to this offering will be cancelled.
    Upon the closing of this offering and the automatic conversion
    of all outstanding shares of non-voting common stock into shares
    of voting stock, any warrants to purchase non-voting common
    stock that are not exercised prior to this offering will remain
    outstanding and will be warrants to purchase shares of voting
    common stock.
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CERTAIN U.S.
    FEDERAL TAX CONSEQUENCES TO
NON-U.S.
HOLDERS
The following is a general discussion of certain
    U.S. federal income and estate tax consequences of the
    purchase, ownership and disposition of our common stock. This
    discussion applies only to a
non-U.S. holder
(as defined below) of our common stock. This discussion is based
    upon the provisions of the Internal Revenue Code of 1986, as
    amended, or the Code, the Treasury regulations promulgated
    thereunder and administrative and judicial interpretations
    thereof, all as of the date hereof, all of which are subject to
    change, possibly with retroactive effect. This discussion is
    limited to investors that hold our common stock as capital
    assets for U.S. federal income tax purposes. Furthermore,
    this discussion does not address all aspects of
    U.S. federal income and estate taxation that may be
    applicable to investors in light of their particular
    circumstances, or to investors subject to special treatment
    under U.S. federal income or estate tax law, such as
    financial institutions, insurance companies, tax-exempt
    organizations, entities that are treated as partnerships for
    U.S. federal tax purposes, dealers in securities or
    currencies, expatriates, persons deemed to sell our common stock
    under the constructive sale provisions of the Code and persons
    that hold our common stock as part of a straddle, hedge,
    conversion transaction or other integrated investment. In
    addition, this discussion does not address any U.S. federal
    gift tax consequences or any state, local or foreign tax
    consequences. Prospective investors should consult their tax
    advisors regarding the U.S. federal, state, local
    alternative minimum and foreign income, estate and other tax
    consequences of the purchase, ownership and disposition of our
    common stock.
For purposes of this summary, the term
"non-U.S. holder"
means a beneficial owner of our common stock that is not, for
    U.S. federal income and estate tax purposes:
•
a citizen or resident of the United States;
•
a corporation or other entity subject to tax as a corporation
    for such purposes that is created or organized under the laws of
    the United States or any political subdivision thereof;
•
a partnership (including any entity or arrangement treated as a
    partnership for such purposes);
•
an estate the income of which is subject to U.S. federal
    income taxation regardless of its source; or
•
a trust (1) if a court within the United States is able to
    exercise primary supervision over its administration and one or
    more U.S. persons have the authority to control all of its
    substantial decisions or (2) that has made a valid election
    to be treated as a U.S. person for such purposes.
If a partnership (including any entity or arrangement treated as
    a partnership for such purposes) owns our common stock, the tax
    treatment of a partner in the partnership will depend upon the
    status of the partner and the activities of the partnership.
    Partners in a partnership that owns our common stock should
    consult their tax advisors as to the particular
    U.S. federal income and estate tax consequences applicable
    to them.
Dividends
Dividends paid to a
non-U.S. holder
generally will be subject to withholding of U.S. federal
    income tax at a 30% rate or such lower rate as may be specified
    by an applicable income tax treaty.
Non-U.S. holders
should consult their tax advisors regarding their entitlement to
    benefits under an applicable income tax treaty and the manner of
    claiming the benefits of such treaty. A
non-U.S. holder
that is eligible for a reduced rate of withholding tax under an
    income tax treaty may obtain a refund or credit of any excess
    amounts withheld by filing an appropriate claim for refund with
    the Internal Revenue Service.
Dividends that are effectively connected with a
non-U.S. holder's
conduct of a trade or business in the United States and, if
    certain income tax treaties apply, that are attributable to a
non-U.S. holder's
permanent establishment in the United States are not subject to
    the withholding tax
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described above but instead are subject to U.S. federal
    income tax on a net income basis at applicable graduated
    U.S. federal income tax rates. A
non-U.S. holder
must satisfy certain certification requirements for its
    effectively connected dividends to be exempt from the
    withholding tax described above. Dividends received by a foreign
    corporation that are effectively connected with its conduct of a
    trade or business in the United States may be subject to an
    additional branch profits tax at a 30% rate or such lower rate
    as may be specified by an applicable income tax treaty.
Gain on
    Disposition of Common Stock
A
non-U.S. holder
generally will not be taxed on gain recognized on a disposition
    of our common stock unless:
•
the
non-U.S. holder
is an individual who holds our common stock as a capital asset,
    is present in the United States for 183 days or more during
    the taxable year of the disposition and meets certain other
    conditions;
•
the gain is effectively connected with the
non-U.S. holder's
conduct of a trade or business in the United States and, if
    certain income tax treaties apply, is attributable to a
non-U.S. Holder's
permanent establishment in the United States; or
•
we are or have been a "United States real property holding
    corporation" for U.S. federal income tax purposes at
    any time within the shorter of the five-year period ending on
    the date of disposition or the period that the
non-U.S. holder
held our common stock.
We do not believe that we have been, currently are, or will
    become, a United States real property holding corporation. If we
    were or were to become a United States real property holding
    corporation at any time during the applicable period, however,
    any gain recognized on a disposition of our common stock by a
non-U.S. holder
that did not own (directly, indirectly or constructively) more
    than 5% of our common stock during the applicable period would
    not be subject to U.S. federal income tax, provided that
    our common stock is "regularly traded on an established
    securities market" (within the meaning of
    Section 897(c)(3) of the Code).
Individual
non-U.S. holders
who are subject to U.S. federal income tax because the
    holders were present in the United States for 183 days or
    more during the year of disposition are taxed on their gains
    (including gains from the sale of our common stock and net of
    applicable U.S. losses from sales or exchanges of other
    capital assets recognized during the year) at a flat rate of 30%
    or such lower rate as may be specified by an applicable income
    tax treaty. Other
non-U.S. holders
subject to U.S. federal income tax with respect to gain
    recognized on the disposition of our common stock generally will
    be taxed on any such gain on a net income basis at applicable
    graduated U.S. federal income tax rates and, in the case of
    foreign corporations, the branch profits tax discussed above
    also may apply.
Federal Estate
    Tax
Our common stock that is owned or treated as owned for
    U.S. estate tax purposes by an individual who is a
non-U.S. holder
at the time of death will be included in the individual's
    gross estate for U.S. federal estate tax purposes.
    Therefore, U.S. federal estate tax may be imposed with
    respect to the value of such stock, unless an applicable estate
    tax or other treaty provides otherwise.
Information
    Reporting and Backup Withholding
In general, backup withholding will apply to dividends on our
    common stock paid to a
non-U.S. holder,
unless the holder has provided the required certification that
    it is a
non-U.S. holder
and the payor does not have actual knowledge (or reason to know)
    that the holder is a U.S. person. Generally, information
    will be reported to the Internal Revenue Service regarding the
    amount of dividends paid, the name and address of the recipient,
    and the amount, if any, of tax withheld. These information
    reporting requirements apply even if no tax was required to be
    withheld. A similar report is
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sent to the recipient of the dividend and may also be made
    available to the tax authorities in the country in which the
non-U.S. holder
resides under the provisions of an applicable income tax treaty.
In general, backup withholding and information reporting will
    apply to the payment of proceeds from the disposition of our
    common stock by a
non-U.S. holder
through a U.S. office of a broker or through the
non-U.S. office
of a broker that is a U.S. person or has certain enumerated
    connections with the United States, unless the holder has
    provided the required certification that it is a
non-U.S. holder
and the payor does not have actual knowledge (or reason to know)
    that the holder is a U.S. person.
Backup withholding is not an additional tax. Any amounts that
    are withheld under the backup withholding rules from a payment
    to a
non-U.S. holder
will be refunded or credited against the holder's
    U.S. federal income tax liability, if any, provided that
    certain required information is furnished to the Internal
    Revenue Service.
Prospective investors should consult their tax advisors
    regarding the application of the information reporting and
    backup withholding rules to them.
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UNDERWRITING
Accretive Health, the selling stockholders and the underwriters
    named below have entered into an underwriting agreement with
    respect to the shares being offered. Subject to certain
    conditions, each underwriter has severally agreed to purchase
    the number of shares indicated in the following table. Goldman,
    Sachs & Co. and Credit Suisse Securities (USA) LLC are
    the joint book-running managers and representatives of the
    underwriters.
Underwriters
Number of Shares
Goldman, Sachs & Co.
Credit Suisse Securities (USA) LLC
J.P. Morgan Securities Inc.
Morgan Stanley & Co. Incorporated
Total
The underwriters are committed to take and pay for all of the
    shares being offered, if any are taken, other than the shares
    covered by the option described below unless and until this
    option is exercised.
If the underwriters sell more shares than the total number set
    forth in the table above, the underwriters have an option to buy
    up to an additional      shares from
    Accretive Health and the selling stockholders to cover such
    sales. They may exercise that option for 30 days. If any
    shares are purchased pursuant to this option, the underwriters
    will severally purchase shares in approximately the same
    proportion as set forth in the table above.
The following tables show the per share and total underwriting
    discounts and commissions to be paid to the underwriters by
    Accretive Health and the selling stockholders. Such amounts are
    shown assuming both no exercise and full exercise of the
    underwriters' option to
    purchase          
    additional shares.
Paid by Accretive
    Health
No Exercise
Full Exercise
Per Share
$
$
Total
$
$
Paid by the
    Selling Stockholders
No Exercise
Full Exercise
Per Share
$
$
Total
$
$
Shares sold by the underwriters to the public will initially be
    offered at the initial public offering price set forth on the
    cover of this prospectus. Any shares sold by the underwriters to
    securities dealers may be sold at a discount of up to
    $      per share from the initial
    public offering price. If all the shares are not sold at the
    initial public offering price, the representatives may change
    the offering price and the other selling terms.
Accretive Health, its officers and directors, and holders of
    substantially all of the outstanding shares of its common stock,
    including the selling stockholders, have agreed with the
    underwriters, subject to certain exceptions, not to offer, sell,
    contract to sell, pledge, grant any option to purchase, make any
    short sale or otherwise dispose of any shares of common stock,
    options or warrants to purchase shares of common stock or
    securities convertible into, exchangeable for or that represent
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the right to receive shares of common stock, make any demand
    for, or exercise any right with respect to, the registration of
    any shares of common stock or any securities convertible into or
    exercisable or exchangeable for shares of common stock, whether
    now owned or hereafter acquired, during the period from the date
    of this prospectus continuing through the date 180 days
    after the date of this prospectus, except with the prior written
    consent of Goldman, Sachs & Co. and Credit Suisse
    Securities (USA) LLC, on behalf of the underwriters. This
    agreement does not apply to any existing employee benefit plans.
    See "Shares Eligible for Future Sale" for a discussion
    of certain transfer restrictions.
The
180-day
restricted period described in the preceding paragraph will be
    automatically extended if: (1) during the last 17 days
    of the
180-day
restricted period Accretive Health issues an earnings release or
    announces material news or a material event; or (2) prior
    to the expiration of the
180-day
restricted period, Accretive Health announces that it will
    release earnings results during the
16-day
period beginning on the last day of the
180-day
period, in which case the restrictions described in the
    preceding paragraph will continue to apply until the expiration
    of the
18-day
period beginning on the issuance of the earnings release or the
    announcement of the material news or material event.
Prior to the offering, there has been no public market for our
    common stock. The initial public offering price has been
    negotiated among Accretive Health and the representatives. Among
    the factors to be considered in determining the initial public
    offering price of the shares, in addition to prevailing market
    conditions, will be Accretive Health's historical
    performance, estimates of the business potential and earnings
    prospects of Accretive Health, an assessment of Accretive
    Health's management and the consideration of the above
    factors in relation to market valuation of companies in related
    businesses.
We intend to file an application to list our common stock on the
    New York Stock Exchange under the symbol "AH".
In connection with the offering, the underwriters may purchase
    and sell shares of common stock in the open market. These
    transactions may include short sales, stabilizing transactions
    and purchases to cover positions created by short sales. Short
    sales involve the sale by the underwriters of a greater number
    of shares than they are required to purchase in the offering.
    "Covered" short sales are sales made in an amount not
    greater than the underwriters' option to purchase
    additional shares from Accretive Health and the selling
    stockholders in the offering. The underwriters may close out any
    covered short position by either exercising their option to
    purchase additional shares or purchasing shares in the open
    market. In determining the source of shares to close out the
    covered short position, the underwriters will consider, among
    other things, the price of shares available for purchase in the
    open market as compared to the price at which they may purchase
    additional shares pursuant to the option granted to them.
    "Naked" short sales are any sales in excess of such
    option. The underwriters must close out any naked short position
    by purchasing shares in the open market. A naked short position
    is more likely to be created if the underwriters are concerned
    that there may be downward pressure on the price of the common
    stock in the open market after pricing that could adversely
    affect investors who purchase in the offering. Stabilizing
    transactions consist of various bids for or purchases of common
    stock made by the underwriters in the open market prior to the
    completion of the offering.
The underwriters may also impose a penalty bid. This occurs when
    a particular underwriter repays to the underwriters a portion of
    the underwriting discount received by it because the
    representatives have repurchased shares sold by or for the
    account of such underwriter in stabilizing or short covering
    transactions.
Purchases to cover a short position and stabilizing
    transactions, as well as other purchases by the underwriters for
    their own accounts, may have the effect of preventing or
    retarding a decline in the market price of Accretive
    Health's stock, and together with the imposition of the
    penalty bid, may stabilize, maintain or otherwise affect the
    market price of the common stock. As a result, the price of
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the common stock may be higher than the price that otherwise
    might exist in the open market. If these activities are
    commenced, they may be discontinued at any time. These
    transactions may be effected on the New York Stock Exchange, in
    the over-the-counter market or otherwise.
In relation to each Member State of the European Economic Area
    which has implemented the Prospectus Directive, each of which is
    referred to as a Relevant Member State, each underwriter has
    represented and agreed that with effect from and including the
    date on which the Prospectus Directive is implemented in that
    Relevant Member State, referred to as the Relevant
    Implementation Date, it has not made and will not make an offer
    of shares to the public in that Relevant Member State prior to
    the publication of a prospectus in relation to the shares which
    has been approved by the competent authority in that Relevant
    Member State or, where appropriate, approved in another Relevant
    Member State and notified to the competent authority in that
    Relevant Member State, all in accordance with the Prospectus
    Directive, except that it may, with effect from and including
    the Relevant Implementation Date, make an offer of shares to the
    public in that Relevant Member State at any time:
•
to legal entities which are authorised or regulated to operate
    in the financial markets or, if not so authorized or regulated,
    whose corporate purpose is solely to invest in securities;
•
to any legal entity which has two or more of (1) an average
    of at least 250 employees during the last financial year;
    (2) a total balance sheet of more than €43,000,000;
    and (3) an annual net turnover of more than
    €50,000,000, as shown in its last annual or consolidated
    accounts;
•
to fewer than 100 natural or legal persons (other than qualified
    investors as defined in the Prospectus Directive) subject to
    obtaining the prior consent of the representatives for any such
    offer; or
•
in any other circumstances which do not require the publication
    by the Issuer of a prospectus pursuant to Article 3 of the
    Prospectus Directive.
For the purposes of this provision, the expression an
    "offer of shares to the public" in relation to any
    shares in any Relevant Member State means the communication in
    any form and by any means of sufficient information on the terms
    of the offer and the shares to be offered so as to enable an
    investor to decide to purchase or subscribe the shares, as the
    same may be varied in that Relevant Member State by any measure
    implementing the Prospectus Directive in that Relevant Member
    State and the expression Prospectus Directive means Directive
    2003/71/EC and includes any relevant implementing measure in
    each Relevant Member State.
Each underwriter has represented and agreed that:
•
it has only communicated or caused to be communicated and will
    only communicate or cause to be communicated an invitation or
    inducement to engage in investment activity (within the meaning
    of Section 21 of the FSMA) received by it in connection
    with the issue or sale of the shares in circumstances in which
    Section 21(1) of the FSMA does not apply to the
    Issuer; and
•
it has complied and will comply with all applicable provisions
    of the FSMA with respect to anything done by it in relation to
    the shares in, from or otherwise involving the United Kingdom.
The shares may not be offered or sold by means of any document
    other than (1) in circumstances which do not constitute an
    offer to the public within the meaning of the Companies
    Ordinance (Cap.32, Laws of Hong Kong), or (2) to
    "professional investors" within the meaning of the
    Securities and Futures Ordinance (Cap.571, Laws of Hong Kong)
    and any rules made thereunder, or (3) in other
    circumstances which do not result in the document being a
    "prospectus" within the meaning of the Companies
    Ordinance (Cap.32, Laws of Hong Kong), and no advertisement,
    invitation or document relating to the shares may be issued or
    may be in the possession of any person for the purpose of issue
    (in each case whether in Hong Kong or elsewhere), which is
    directed at, or the contents of which are likely to be accessed
    or read by, the public in Hong Kong (except if permitted to
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do so under the laws of Hong Kong) other than with respect to
    shares which are or are intended to be disposed of only to
    persons outside Hong Kong or only to "professional
    investors" within the meaning of the Securities and Futures
    Ordinance (Cap. 571, Laws of Hong Kong) and any rules made
    thereunder.
This prospectus has not been registered as a prospectus with the
    Monetary Authority of Singapore. Accordingly, this prospectus
    and any other document or material in connection with the offer
    or sale, or invitation for subscription or purchase, of the
    shares may not be circulated or distributed, nor may the shares
    be offered or sold, or be made the subject of an invitation for
    subscription or purchase, whether directly or indirectly, to
    persons in Singapore other than (1) to an institutional
    investor under Section 274 of the Securities and Futures
    Act, Chapter 289 of Singapore, (2) to a relevant
    person, or any person pursuant to Section 275(1A), and in
    accordance with the conditions, specified in Section 275 of
    the Securities and Futures Act or (3) otherwise pursuant
    to, and in accordance with the conditions of, any other
    applicable provision of the Securities and Futures Act.
Where the shares are subscribed or purchased under
    Section 275 by a relevant person which is: (a) a
    corporation (which is not an accredited investor) the sole
    business of which is to hold investments and the entire share
    capital of which is owned by one or more individuals, each of
    whom is an accredited investor; or (b) a trust (where the
    trustee is not an accredited investor) whose sole purpose is to
    hold investments and each beneficiary is an accredited investor,
    shares, debentures and units of shares and debentures of that
    corporation or the beneficiaries' rights and interest in
    that trust shall not be transferable for six months after that
    corporation or that trust has acquired the shares under
    Section 275 except: (1) to an institutional investor
    under Section 274 of the Securities and Futures Act or to a
    relevant person, or any person pursuant to Section 275(1A),
    and in accordance with the conditions, specified in
    Section 275 of the Securities and Futures Act;
    (2) where no consideration is given for the transfer; or
    (3) by operation of law.
The securities have not been and will not be registered under
    the Securities and Exchange Law of Japan (the Securities and
    Exchange Law) and each underwriter has agreed that it will not
    offer or sell any securities, directly or indirectly, in Japan
    or to, or for the benefit of, any resident of Japan (which term
    as used herein means any person resident in Japan, including any
    corporation or other entity organized under the laws of Japan),
    or to others for re-offering or resale, directly or indirectly,
    in Japan or to a resident of Japan, except pursuant to an
    exemption from the registration requirements of, and otherwise
    in compliance with, the Securities and Exchange Law and any
    other applicable laws, regulations and ministerial guidelines of
    Japan.
The underwriters do not expect sales to discretionary accounts
    to exceed five percent of the total number of shares offered.
Upon the completion of this offering and based on an assumed
    initial public offering price of $     
    per share, the midpoint of the estimated price range shown on
    the cover of this prospectus, Accretive Health will pay FT
    Partners a fee of $      for financial
    advisory services in respect of this offering. This fee will be
    paid     % in cash
    and     % through the issuance of
    shares of our common stock valued at the initial public offering
    price per share. FT Partners has entered into a
lock-up
agreement with the underwriters with respect to these shares and
    these shares will also be subject to limitations on resale
    imposed by Rule 144, each as described under the heading
    "Shares Eligible for Future Sale" elsewhere in this
    prospectus. FT Partners' financial advisory services
    included assistance in financial and valuation modeling and
    advice with respect to the initial public offering process and
    equity capital market alternatives. None of Financial Technology
    Partners, LLC, FTP Securities, LLC or any of their affiliates is
    acting as an underwriter of this offering.
Accretive Health and the selling stockholders estimate that the
    total expenses of the offering payable by them, excluding
    underwriting discounts and commissions, will be approximately
    $          .
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Accretive Health and the selling stockholders have agreed to
    indemnify the several underwriters against certain liabilities,
    including liabilities under the Securities Act of 1933.
Certain of the underwriters and their respective affiliates may
    in the future perform various financial advisory and investment
    banking services for the company, for which they received or
    will receive customary fees and expenses.
LEGAL
    MATTERS
The validity of the common stock being offered will be passed
    upon for us by Wilmer Cutler Pickering Hale and Dorr LLP,
    Boston, Massachusetts. The underwriters are represented by
    Skadden, Arps, Slate, Meagher & Flom LLP, New York,
    New York, in connection with this offering.
EXPERTS
Ernst & Young LLP, an independent registered public
    accounting firm, has audited our consolidated financial
    statements and schedule at December 31, 2007 and 2008, and
    for each of the three years in the period ended
    December 31, 2008, as set forth in their report. We have
    included our consolidated financial statements and schedule in
    the prospectus and elsewhere in the registration statement in
    reliance on Ernst & Young LLP's report, given their
    authority as experts in accounting and auditing.
WHERE YOU CAN
    FIND MORE INFORMATION
We have filed with the SEC a registration statement on
Form S-1
under the Securities Act of 1933 with respect to the shares of
    common stock to be sold in this offering. This prospectus, which
    constitutes part of the registration statement, does not include
    all of the information contained in the registration statement
    and the exhibits, schedules and amendments to the registration
    statement. Some items are omitted in accordance with the rules
    and regulations of the SEC. For further information with respect
    to us and our common stock, we refer you to the registration
    statement and to the exhibits and schedules to the registration
    statement filed as part of the registration statement.
    Statements contained in this prospectus about the contents of
    any contract or any other document filed as an exhibit are not
    necessarily complete and, and in each instance, we refer you to
    the copy of the contract or other documents filed as an exhibit
    to the registration statement. Each of theses statements is
    qualified in all respects by this reference.
You may read and copy the registration statement of which this
    prospectus is a part at the SEC's public reference room,
    which is located at 100 F Street, N.E.,
    Room 1580, Washington, D.C. 20549. You can request
    copies of the registration statement by writing to the SEC and
    paying a fee for the copying cost. Please call the SEC at
1-800-SEC-0330
for more information about the operation of the SEC's
    public reference room. In addition, the SEC maintains an
    Internet website, located at www.sec.gov, which contains
    reports, proxy and information statements and other information
    regarding issuers that file electronically with the SEC. You may
    access the registration statement of which this prospectus is a
    part at the SEC's Internet website.
Upon the closing of this offering, we will become subject to the
    full informational and periodic reporting requirements of the
    Exchange Act. We will fulfill our obligations with respect to
    such requirements by filing periodic reports and other
    information with the SEC. We intend to furnish our stockholders
    with annual reports containing consolidated financial statements
    certified by an independent registered public accounting firm.
    We also maintain a website at www.accretivehealth.com. Our
    website is not a part of this prospectus.
131
Table of Contents
Accretive Health,
    Inc.
Index to
    Consolidated Financial Statements
Page
Audited Consolidated Financial
    Statements
Report of Independent Registered Public
    Accounting Firm
F-2
Consolidated Balance Sheets
F-3
Consolidated Statements of Operations
F-4
Consolidated Statements of Stockholders'
    Equity
F-5
Consolidated Statements of Cash Flows
F-7
Notes to Consolidated Financial Statements
F-8
F-1
Table of Contents
Report of
    Independent Registered Public Accounting Firm
The Board of Directors and Shareholders
Accretive Health, Inc.
We have audited the accompanying consolidated balance sheets of
    Accretive Health, Inc. (formerly Healthcare Services Inc. d/b/a
    Accretive Health) as of December 31, 2008 and 2007, and the
    related consolidated statements of operations,
    stockholders' equity, and cash flows for each of the three
    years in the period ended December 31, 2008. These
    financial statements are the responsibility of the
    Company's management. Our responsibility is to express an
    opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the
    Public Company Accounting Oversight Board (United States). Those
    standards require that we plan and perform the audit to obtain
    reasonable assurance about whether the financial statements are
    free of material misstatement. We were not engaged to perform an
    audit of the Company's internal control over financial
    reporting. Our audits included consideration of internal control
    over financial reporting as a basis for designing audit
    procedures that are appropriate in the circumstances, but not
    for the purpose of expressing an opinion on the effectiveness of
    the Company's internal control over financial reporting.
    Accordingly, we express no such opinion. An audit also includes
    examining, on a test basis, evidence supporting the amounts and
    disclosures in the financial statements, assessing the
    accounting principles used and significant estimates made by
    management, and evaluating the overall financial statement
    presentation. We believe that our audits provide a reasonable
    basis for our opinion.
In our opinion, the financial statements referred to above
    present fairly, in all material respects, the consolidated
    financial position of Accretive Health, Inc. at
    December 31, 2008 and 2007, and the consolidated results of
    its operations and its cash flows for each of the three years in
    the period ended December 31, 2008, in conformity with
    U.S. generally accepted accounting principles.
As disclosed in Note 2 in the notes to the consolidated
    financial statements, effective January 1, 2007, the
    Company adopted Financial Accounting Standards Board (FASB)
    Interpretation No. 48,
Accounting for Uncertainty in
    Income Taxes, an interpretation of FASB Statement
    No. 109.
/s/  Ernst &
    Young LLP
Chicago, Illinois
May 20, 2009
F-2
Table of Contents
Accretive Health,
    Inc.
Consolidated
    Balance Sheets
(In thousands,
    except share and per share amounts)
December 31,
June 30,
2007
2008
2009
(Unaudited)
Assets
Current assets:
Cash and cash equivalents
$
34,745
$
51,656
$
37,789
Accounts receivable, net of allowance for doubtful accounts of
    $432, $82, and $82 at December 31, 2007, 2008, and
    June 30, 2009, respectively
15,897
20,206
40,876
Prepaid assets
371
1,031
8,972
Due from related party
941
1,261
1,275
Other current assets
1,004
1,374
630
Total current assets
52,958
75,528
89,542
Deferred income tax
—
—
4,542
Furniture and equipment, net
4,566
8,913
9,875
Goodwill
1,468
1,468
1,468
Other, net
1,866
995
538
Total assets
$
60,858
$
86,904
$
105,965
Liabilities and stockholders' equity
Current liabilities:
Accounts payable
$
22,146
$
38,205
$
50,880
Accrued payroll
5,592
9,147
5,095
Deferred income tax
—
—
1,894
Accrued taxes
—
1,208
224
Other accrued expenses
4,498
7,434
7,858
Deferred revenue
12,712
22,987
19,477
Current liabilities
44,948
78,981
85,428
Commitments and contingencies
—
—
—
Stockholders' equity:
Convertible preferred stock, Series A, $0.01 par
    value, 32,317 shares authorized, 32,317 shares issued
    and outstanding at December 31, 2007 and 2008, and
    June 30, 2009
—
—
—
Convertible preferred stock, Series D, $0.01 par
    value, 1,267,224 shares authorized, issued, and outstanding
    at December 31, 2007 and 2008, and June 30, 2009,
    respectively
13
13
13
Series B common stock, $0.01 par value,
    17,500,000 shares authorized, 4,784,758, 8,161,361 and
    8,178,119 shares issued, and outstanding at
    December 31, 2007 and 2008, and June 30, 2009,
    respectively
48
82
82
Series C common stock, $0.01 par value, 7,500,000,
    8,000,000 and 8,000,000 shares authorized, 4,462,141,
    1,271,732 and 1,321,857 shares issued and outstanding at
    December 31, 2007 and 2008, and June 30, 2009,
    respectively
44
13
13
Additional paid-in capital
32,361
38,401
45,773
Non-executive employee loans for stock option exercises
(320
)
(263
)
(230
)
Accumulated deficit
(16,246
)
(30,101
)
(24,887
)
Cumulative translation adjustment
10
(222
)
(227
)
Total stockholders' equity
15,910
7,923
20,537
Total liabilities and stockholders' equity
$
60,858
$
86,904
$
105,965
See accompanying notes to consolidated financial statements
F-3
Table of Contents
Accretive Health,
    Inc.
Consolidated
    Statements of Operations
(In thousands,
    except share and per share amounts)
Year Ended December 31
Six Months Ended June 30,
2006
2007
2008
2008
2009
(Unaudited)
Net services revenue
$
160,741
$
240,725
$
398,469
$
187,261
$
238,149
Costs of services
141,767
197,676
335,211
160,082
195,667
Operating margin
18,974
43,049
63,258
27,179
42,482
Other operating expenses:
Infused management and technology
18,875
27,872
39,234
17,938
24,482
Selling, general, and administrative
8,777
15,657
21,227
9,642
15,308
Total operating expenses
27,652
43,529
60,461
27,580
39,790
Income (loss) from operations
(8,678
)
(480
)
2,797
(401
)
2,692
Interest income
1,359
1,710
710
433
83
Net income (loss) before provision for (benefit from) income
    taxes
(7,319
)
1,230
3,507
32
2,775
Provision for (benefit from) income taxes
—
456
2,264
626
(2,439
)
Net income (loss)
$
(7,319
)
$
774
$
1,243
$
(594
)
$
5,214
Net income (loss) per common share
Basic
(0.89
)
0.04
(0.70
)
(0.06
)
0.25
Diluted
(1.02
)
0.03
(0.73
)
(0.06
)
0.21
Weighted-average shares used in calculating net income (loss)
    per common share
Basic
6,611,975
8,410,226
9,214,916
9,160,187
9,337,812
Diluted
6,611,975
10,296,011
9,214,916
9,160,187
11,492,646
See accompanying notes to consolidated financial statements
F-4
Table of Contents
Accretive Health,
    Inc.
Consolidated
    Statements of Stockholders' Equity
(In thousands,
    except share amounts)
Convertible
Convertible
Loans
Preferred Stock
Preferred Stock
Class B
Class C
Additional
for Stock
Cumulative
Series A
Series D
Common Stock
Common Stock
Paid-In
Option
Accumulated
Translation
Comprehensive
Shares
Amount
Shares
Amount
Shares
Amount
Shares
Amount
Capital
Exercises
Deficit
Adjustment
Total
Income (Loss)
Balance at January 1, 2006
32,317
$
—
1,267,224
$
13
3,902,374
$
39
3,633,284
$
36
$
18,148
$
—
$
(9,701
)
$
—
8,535
$
—
Issuance of class C common stock
—
—
—
—
—
—
99,757
1
524
—
—
—
525
—
Issuance of warrants
—
—
—
—
—
—
—
—
83
—
—
—
83
—
Exercise of vested stock options
—
—
—
—
—
—
485,390
5
858
—
—
—
863
—
Amounts loaned to employees related to stock option exercises,
    net
—
—
—
—
—
—
—
—
—
(365
)
—
—
(365
)
—
Compensation expense related to restricted common stock
—
—
—
—
—
—
—
—
50
—
—
—
50
—
Compensation expense related to stock options
—
—
—
—
—
—
—
—
794
—
—
—
794
—
Net loss
—
—
—
—
—
—
—
—
—
—
(7,319
)
—
(7,319
)
(7,319
)
Balance at December 31, 2006
32,317
$
—
1,267,224
$
13
3,902,374
$
39
4,218,431
$
42
$
20,457
$
(365
)
$
(17,020
)
$
—
$
3,166
$
(7,319
)
Issuance of class B common stock
—
—
—
—
882,384
9
—
—
5,481
—
—
—
5,490
—
Issuance of class C common stock
—
—
—
—
—
—
39,899
—
327
—
—
—
327
—
Exercise of vested stock options
—
—
—
—
—
—
16,021
—
39
—
—
—
39
—
Vesting of previously exercised options
—
—
—
—
—
—
253,811
3
697
—
—
—
700
Repayments of amounts loaned to employees related to stock
    option exercises, net
—
—
—
—
—
—
—
—
—
45
—
—
45
—
Share repurchases
—
—
—
—
—
—
(66,021
)
(1
)
(655
)
—
—
—
(656
)
—
Issuance of stock warrants
—
—
—
—
—
—
—
—
5,081
—
—
—
5,081
—
Compensation expense related to restricted common stock
—
—
—
—
—
—
—
—
38
—
—
—
38
—
Compensation expense related to stock options
—
—
—
—
—
—
—
—
896
—
—
—
896
—
Currency translation adjustments
—
—
—
—
—
—
—
—
—
—
—
10
10
10
Net income
—
—
—
—
—
—
—
—
—
774
—
774
774
Balance at December 31, 2007
32,317
$
—
1,267,224
$
13
4,784,758
$
48
4,462,141
$
44
$
32,361
$
(320
)
$
(16,246
)
$
10
$
15,910
$
784
F-5
Table of Contents
Accretive Health,
    Inc.
Consolidated
    Statements of Stockholders' Equity —
    (Continued)
(In thousands,
    except share amounts)
Convertible
Convertible
Loans
Preferred Stock
Preferred Stock
Class B
Class C
Additional
for Stock
Cumulative
Series A
Series D
Common Stock
Common Stock
Paid-In
Option
Accumulated
Translation
Comprehensive
Shares
Amount
Shares
Amount
Shares
Amount
Shares
Amount
Capital
Exercises
Deficit
Adjustment
Total
Income (Loss)
Implementation of FASB Interpretation No. 48
—
—
—
—
—
—
—
—
—
—
(97
)
—
(97
)
Exchange of Series C to Series B Stock
—
—
—
—
3,309,951
33
(3,309,951
)
(33
)
—
—
—
—
—
Issuance of class B common stock
—
—
—
—
66,652
1
—
—
—
—
—
—
1
Exercise of vested stock options
—
—
—
—
—
—
3,750
—
18
—
—
—
18
Vesting of previously exercised options
—
—
—
—
—
—
150,375
2
649
—
—
—
651
Repayments (advances) of amounts loaned to employees related to
    stock option exercises, net
—
—
—
—
—
—
—
—
—
57
—
—
57
Share repurchases
—
—
—
—
—
—
(34,583
)
—
(1,510
)
—
—
—
(1,510
)
Issuance of stock warrants
—
—
—
—
—
—
—
—
3,332
—
—
—
3,332
Compensation expense related to restricted common stock
—
—
—
—
—
—
—
—
5
—
—
—
5
Compensation expense related to stock options
—
—
—
—
—
—
—
—
3,546
—
—
—
3,546
Currency translation adjustments
—
—
—
—
—
—
—
—
—
—
—
(232
)
(232
)
(232
)
Dividends declared
—
—
—
—
—
—
—
—
—
—
(15,001
)
—
(15,001
)
Net income
—
—
—
—
—
—
—
—
—
—
1,243
—
1,243
1,243
Balance at December 31, 2008
32,317
$
—
1,267,224
$
13
8,161,361
$
82
1,271,732
$
13
$
38,401
$
(263
)
$
(30,101
)
$
(222
)
$
7,923
$
1,011
Exercise of vested stock options
—
—
—
—
—
—
20,000
—
147
—
—
—
147
Vesting of previously exercised options
—
—
—
—
—
—
30,125
—
141
—
—
—
141
Issuance of class B common stock
—
—
—
—
16,758
—
—
—
—
—
—
—
—
Repayments of amounts loaned to employees related to stock
    option exercises, net
—
—
—
—
—
—
—
—
—
33
—
—
33
Issuance of stock warrants
—
—
—
—
—
—
—
—
4,107
—
—
—
4,107
Compensation expense related to stock options
—
—
—
—
—
—
—
—
2,977
—
—
—
2,977
Currency translation adjustments
—
—
—
—
—
—
—
—
—
—
—
(5
)
(5
)
(5
)
Net income
—
—
—
—
—
—
—
—
—
—
5,214
—
5,214
5,214
Balance at June 30, 2009 (unaudited)
32,317
$
—
1,267,224
$
13
8,178,119
$
82
1,321,857
$
13
$
45,773
$
(230
)
$
(24,887
)
$
(227
)
$
20,537
$
5,209
See accompanying notes to consolidated financial statements
F-6
Table of Contents
Accretive Health,
    Inc.
Consolidated
    Statements of Cash Flows
(In
    thousands)
Year Ended December 31
Six Months Ended June 30,
2006
2007
2008
2008
2009
(Unaudited)
Operating activities
Net income (loss)
$
(7,319
)
$
774
$
1,243
$
(594
)
$
5,214
Adjustments to reconcile net income (loss) to net cash provided
    by (used in) operations:
Depreciation
277
530
1,030
574
950
Amortization
349
777
1,510
346
932
Employee stock based compensation
844
934
3,551
1,021
2,977
Expense associated with the issuance of stock warrants
83
5,081
3,332
3,080
4,107
Deferred income taxes
—
—
—
—
(2,648
)
Changes in operating assets and liabilities:
Accounts receivable
234
(15,091
)
(4,309
)
937
(20,669
)
Prepaid and other current assets
(76
)
(2,182
)
(1,381
)
(832
)
(7,207
)
Accounts payable
6,164
8,286
16,074
10,624
12,678
Accrued payroll
468
3,263
3,563
(1,959
)
(4,053
)
Other accrued expenses
(457
)
2,864
3,359
1,632
560
Accrued income tax
—
—
1,208
160
(984
)
Deferred revenue
5,423
6,599
10,275
(5,077
)
(3,510
)
Loss on disposal of equipment
—
—
70
—
—
Net cash provided by (used in) operating activities
5,990
11,835
39,525
9,912
(11,653
)
Investing activities
Purchase of SureDecisions net of cash acquired
(1,419
)
(211
)
—
—
—
Purchases of furniture and equipment
(412
)
(1,837
)
(1,843
)
(1,006
)
(1,037
)
Acquisition of software
(915
)
(1,639
)
(4,988
)
(1,609
)
(1,790
)
Customer incentive advance
(2,000
)
416
698
293
444
Net cash used in investing activities
(4,746
)
(3,271
)
(6,133
)
(2,322
)
(2,383
)
Financing activities
Proceeds from issuance of class B common stock
—
5,490
1
1
—
Proceeds from issuance of class C common stock from
    employee stock option exercise
2,345
510
150
150
151
Collection (issuance) of non-executive employee notes receivable
(365
)
45
57
(545
)
33
Payment of dividends
—
—
(15,001
)
—
—
Repurchase of common stock
—
(656
)
(1,510
)
—
—
Net cash provided by (used in) financing activities
1,980
5,389
(16,303
)
(394
)
184
Effect of exchange rate changes in cash
—
10
(178
)
(45
)
(15
)
Net increase (decrease) in cash and cash equivalents
3,224
13,963
16,911
7,151
(13,867
)
Cash and cash equivalents at beginning of year
17,558
20,782
34,745
34,745
51,656
Cash and cash equivalents at end of year
$
20,782
$
34,745
$
51,656
$
41,896
$
37,789
Supplemental disclosures of cash flow information
Interest paid
$
—
$
—
$
—
$
—
$
—
Taxes paid
—
791
1,137
536
8,215
Exercise of unvested stock options
1,482
471
132
132
4
Supplemental disclosures of noncash financing transactions
Shares issued in connection with the acquisition of SureDecisions
$
525
$
327
$
—
$
—
$
—
Issuance of notes receivable to non-executive employees
(365
)
—
(585
)
(585
)
—
Vesting of previously exercised stock options
—
700
651
157
141
See accompanying notes to consolidated financial statements
F-7
Table of Contents
Accretive Health,
    Inc.
Notes
    to Consolidated Financial Statements
1.
Description of
    Business
Accretive Health, Inc. (the "Company") is a leading
    provider of healthcare revenue cycle management services. The
    Company's business purpose is to help U.S. hospitals,
    physicians and other healthcare providers manage their revenue
    cycle operations more efficiently. The Company's
    integrated, end-to-end technology and services offering, which
    is referred to as Accretive's solution, helps customers
    realize sustainable improvements in their operating margins and
    improve the satisfaction of their patients, physicians and
    staff. The Company enables these improvements by helping
    customers increase the portion of the maximum potential revenue
    received while reducing total revenue cycle costs.
2.
Summary of
    Significant Accounting Policies
Basis of
    Presentation
The consolidated financial statements include the Company and
    its wholly owned subsidiaries, SureDecisions, Inc.
    ("SureDecisions"), Accretive Health India Private
    Limited, and Accretive Health India Service Private Limited. All
    intercompany transactions and balances have been eliminated in
    consolidation. These financial statements have been prepared in
    accordance with accounting principles generally accepted in the
    United States.
Unaudited
    Interim Financial Statements
The accompanying interim consolidated balance sheet as of
    June 30, 2009, the statement of stockholders' equity
    for the six months ended June 30, 2009 and the consolidated
    statements of operations and cash flows for the six months ended
    June 30, 2008 and 2009 are unaudited and have been prepared
    in accordance with the rules and regulations of the
    U.S. Securities and Exchange Commission. They do not
    include all of the information and footnotes required by
    accounting principles generally accepted in the United States
    for complete financial statements. The unaudited interim
    consolidated financial statements have been prepared on the same
    basis as the audited consolidated financial statement and, in
    the opinion of the Company's management, reflect all
    adjustments consisting of normal recurring accruals considered
    necessary to present fairly the Company's financial
    position as of June 30, 2009 and results of its operations
    and its cash flows for the six months ended June 30, 2008
    and 2009. The results of operations for the six months ended
    June 30, 2009 are not necessarily indicative of the results
    that may be expected for the year ending December 31, 2009.
Use of
    Estimates
The preparation of financial statements in conformity with
    accounting principles generally accepted in the United States
    requires management to make estimates and assumptions that
    affect the reported amounts of assets and liabilities, the
    disclosure of contingent assets and liabilities at the date of
    the consolidated financial statements, and the reported amounts
    of revenues and expenses during the reporting period.
The Company regularly evaluates its accounting policies and
    estimates. In general, estimates are based on historical
    experience and on assumptions believed to be reasonable given
    the Company's operating environment. These estimates are
    based on management's best knowledge of current events and
    actions the Company may undertake in the future. Actual results
    may differ from these estimates.
F-8
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
Revenue
    Recognition
As of June 30, 2009, the Company has entered into managed
    service contracts with 21 customers. The Company's managed
    service contracts generally have an initial term of four to five
    years and various start and end dates. After the initial terms,
    these contracts renew annually unless canceled by either party.
The Company records net services revenue in accordance with the
    provisions of Staff Accounting Bulletin 104. As a result,
    the Company only records revenue once there is persuasive
    evidence of an arrangement, services have been rendered, the
    amount of revenue has become fixed or determinable and
    collectibility is reasonably assured. The Company recognizes
    base fee revenues on a straight-line basis over the life of the
    contract. Base fees for managed service contracts which are
    received in advance of services delivered are classified as
    deferred revenue until services have been provided.
The Company's managed service contracts generally allow for
    adjustments to the base fee. Adjustments typically occur at 90,
    180 or 360 days after the contract commences, but can also
    occur at subsequent dates as a result of factors including
    changes to the scope of operations and internal and external
    audits. All adjustments, the timing of which is often dependent
    on factors outside of the Company's control and which can
    increase or decrease revenue and operating margin, are recorded
    in the period the changes are known and collectibility is
    reasonably assured. Any such adjustments may cause the
    Company's quarter-to-quarter results of operations to
    fluctuate.
The Company records revenue for incentive payments once the
    calculation of the incentive payment earned is finalized and
    collectibility is reasonably assured. The Company uses a
    proprietary technology and methodology to calculate the amount
    of benefit each customer receives as a result of the
    Company's services. The Company's calculations are
    based in part on the amount of revenue each customer is entitled
    to receive from commercial and private insurance carriers,
    Medicare, Medicaid and patients. Because the laws, regulations,
    instructions, payor contracts and rule interpretations governing
    how the Company's customers receive payments from these
    parties are complex and change frequently, estimates of prior
    period net revenue yield calculations could change. All changes
    in estimates are recorded when new information is available and
    calculations are completed.
Incentive payments are based on the benefits a customer has
    received throughout the life of the contract. Each quarter, the
    Company records the increase in the total benefits received to
    date. If a quarterly calculation indicates that the cumulative
    benefits to date have decreased, the Company records a reduction
    in revenue. If the decrease in revenue exceeds the amount
    previously paid by the customer, the excess is recorded as
    deferred revenue.
The Company's services also include collection of dormant
    patient accounts receivable that have aged 365 days or more
    directly from individual patients. The Company shares all cash
    generated from these collections with its customers in
    accordance with specified arrangements. The Company records as
    revenue its portion of the cash received from these collections
    when each customer's cash application is complete.
Cash and Cash
    Equivalents
The Company considers all highly liquid investments with a
    maturity of three months or less when purchased to be cash
    equivalents.
F-9
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
Allowance for
    Uncollectible Accounts Receivable
The Company extends unsecured credit to its customers based on
    its assessment of each customer's creditworthiness. The
    Company maintains an estimated allowance for doubtful accounts
    to reduce its gross accounts receivable to the amount that it
    believes will be collected. This allowance is based on the
    Company's historical experience, its assessment of each
    customer's ability to pay and the status of any ongoing
    operations with each applicable customer.
Fair Value of
    Financial Instruments
The fair values of cash, other current assets, and current
    liabilities approximate their carrying value due to the
    short-term nature of these financial instruments.
Furniture and
    Equipment
Furniture and equipment are stated at cost, less accumulated
    depreciation determined on the straight-line method over the
    estimated useful lives of the assets as follows:
Leasehold improvements
Shorter of 5 years or lease term
Office furniture
5 years
Capitalized software
3 to 5 years
Computers and other equipment
3 years
Software
    Development
The Company applies the provisions of the American Institute of
    Certified Public Accountants' Statement of Position
No. 98-1
("SOP 98-1"),
Accounting for Costs of Computer Software Developed or
    Obtained for Internal Use
, which requires the capitalization
    of costs incurred in connection with developing or obtaining
    internal use software. In accordance with
SOP 98-1,
the Company capitalizes the costs of internally-developed,
    internal use, software when an application is in the development
    stage. This generally occurs after the overall design and
    functionality of the application has been approved and
    management has committed to the application's development.
    Capitalized software development costs consist of payroll and
    payroll-related costs for employee time spent developing a
    specific internal use software application, and external costs
    incurred that are related directly to the development of a
    specific application.
Goodwill
Goodwill represents the excess purchase price over the net
    assets acquired for SureDecisions, which the Company acquired in
    May 2006. In accordance with Statement of Financial Accounting
    Standards ("SFAS") No. 142,
Goodwill and Other
    Intangible Assets
, goodwill is not subject to amortization
    but is subject to impairment testing at least annually. The
    Company's annual impairment assessment date is the first
    date of the fourth quarter. The Company conducts its impairment
    testing on a company-wide basis because it has only one
    reporting unit. The Company's impairment tests are based on
    its current business strategy in light of present industry and
    economic conditions and future expectations.
As the Company applies its judgment to estimate future cash
    flows and an appropriate discount rate, the analysis reflects
    assumptions and uncertainties. The Company's estimates of
    future cash flows could differ from actual results. The
    Company's most recent impairment assessment did not result
    in goodwill impairment.
F-10
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
Foreign
    Currency
The functional currency of each entity in the Company is its
    respective local currency, which is also the currency of the
    primary economic environment in which it operates. Transactions
    in foreign currencies are re-measured into functional currency
    at the rates of exchange prevailing on the date of the
    transaction. All transaction foreign exchange gains and losses
    are recorded in the accompanying consolidated statements of
    operations.
The assets and liabilities of the subsidiaries which use a
    functional currency other than the U.S. dollar are
    translated into U.S. dollars at the rate of exchange
    prevailing on the balance sheet dates. Revenues and expenses are
    translated into U.S. dollars at the average exchange rate
    during each month. Resulting translation adjustments are
    included in accumulated other comprehensive income (loss).
Impairments of
    Long-Lived Assets
The Company evaluates all of its long-lived assets, such as
    furniture, equipment, software and other intangibles, for
    impairment in accordance with Statement of Financial Accounting
    Standard No. 144,
Accounting for the Impairment or
    Disposal of Long-Lived Assets
, when events or changes in
    circumstances warrant such a review. If an evaluation is
    required, the estimated future undiscounted cash flows
    associated with the asset are compared to the asset's
    carrying amount to determine if an adjustment to fair market
    value is required.
See Note 8 for discussion of the impairment loss recorded
    for customer relationships in 2008.
Income
    Taxes
The Company records deferred tax assets and liabilities for
    future income tax consequences that are attributable to
    differences between the carrying amount of assets and
    liabilities for financial statement purposes and the income tax
    bases of such assets and liabilities. Deferred tax assets and
    liabilities are measured based on enacted tax rates that are
    expected to apply in the year that the temporary differences are
    expected to be settled. Deferred tax assets and liabilities are
    adjusted for changes in income tax rates in the period that
    includes the enactment date. A valuation allowance for deferred
    tax assets is provided if, based upon the available evidence, it
    is more likely than not that some or all of the deferred tax
    assets will not be realized.
As of December 31, 2008 and in all prior periods, a
    valuation allowance was provided for all net deferred tax
    assets. As a result of the Company's improved operations,
    in the second quarter of 2009 the Company determined that it was
    no longer necessary to maintain a valuation allowance for all of
    its deferred tax assets, and therefore released the allowance of
    $3.5 million.
Beginning January 1, 2008, with the adoption of FASB
    Interpretation No. 48,
Accounting for Uncertainty in
    Income Taxes
, or FIN 48, the Company recognizes the
    financial statement effects of a tax position only when it is
    more likely than not that the position will be sustained upon
    examination. Tax positions taken or expected to be taken that
    are not recognized under the pronouncement are recorded as
    liabilities.
As a result of the Company's adoption of FIN 48, the
    Company recognized a $0.2 million increase to reserves for
    uncertain tax positions, of which, $0.1 million was
    recorded as a cumulative effect adjustment to retained earnings.
    The remaining $0.1 million related to current year changes
    and was recorded as an expense in 2008.
The Company recognizes interest and penalties relating to income
    tax matters in the income tax provision.
F-11
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
Share-Based
    Compensation
Share-based compensation expense results from awards of
    restricted common stock and grants of stock options and warrants
    to employees, directors, outside consultants, customers, vendors
    and others. The Company recognizes the costs associated with
    option and warrant grants using the fair value recognition
    provisions of Statement of Financial Accounting Standards
    No. 123(R),
Share-Based Payment
, Generally,
    SFAS 123(R) requires the value of all share-based payments
    to be recognized in the statement of operations based on their
    estimated fair value at date of grant amortized over the
    grant's vesting period.
Legal
    Proceedings
In the normal course of business, the Company is involved in
    legal proceedings or regulatory investigations. The Company
    evaluates the need for loss accruals using the requirements of
    SFAS No. 5,
Accounting for Contingencies
. When
    conducting this evaluation, the Company considers factors such
    as the probability of an unfavorable outcome and the ability to
    make a reasonable estimate of the amount of loss. The Company
    records an estimated loss for any claim, lawsuit, investigation
    or proceeding when it is probable that a liability has been
    incurred and the amount of the loss can reasonably be estimated.
    If the reasonable estimate of a probable loss is a range, and no
    amount within the range is a better estimate, then the Company
    records the minimum amount in the range as its loss accrual. If
    a loss is not probable or a probable loss cannot be reasonably
    estimated, no liability is recorded.
New Accounting
    Standards and Disclosures
In December 2007, the Financial Accounting Standards Board
    ("FASB") issued Statement of Financial Accounting
    Standards ("SFAS") No. 141(R),
Business
    Combinations
. SFAS No. 141(R) requires the Company
    to continue to follow the guidance in SFAS No. 141 for
    certain aspects of business combinations, with additional
    guidance provided defining the acquirer, recognizing and
    measuring the identifiable assets acquired, the liabilities
    assumed, any noncontrolling interest in the acquiree, assets and
    liabilities arising from contingencies, defining a bargain
    purchase, and recognizing and measuring goodwill or a gain from
    a bargain purchase. In addition, under
    SFAS No. 141(R), adjustments associated with changes
    in tax contingencies that occur after the measurement period,
    not to exceed one year, are recorded as adjustments to income.
    This statement is effective for all business combinations for
    which the acquisition date is on or after the beginning of an
    entity's first fiscal year that begins after
    December 15, 2008; however, the guidance in this standard
    regarding the treatment of income tax contingencies is
    retroactive to business combinations completed prior to
    January 1, 2009. The Company adopted
    SFAS No. 141(R) on January 1, 2009. The adoption
    had no material impact on the Company's consolidated
    financial statements.
In April 2008, the FASB issued FASB Staff Position
    ("FSP")
SFAS 142-3,
"Determination of the Useful Life of Intangible
    Assets
". This FSP amends the factors that should be
    considered in developing renewal or extension assumptions used
    to determine the useful life of a recognized intangible asset
    under SFAS No. 142. The intent of this FSP is to
    improve the consistency between the useful life of a recognized
    intangible asset under SFAS No. 142 and the period of
    expected cash flows used to measure the fair value of the asset
    under SFAS No. 141R and other United States generally
    accepted accounting principles. This FSP is effective for
    financial statements issued for fiscal years beginning after
    December 15, 2008, and interim periods within those fiscal
    years. The Company adopted this FSP January 1, 2009. The
    adoption of this FSP did not have an impact on the consolidated
    financial statements.
F-12
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
In June 2008, the FASB issued FSP Emerging Issues Task Force
    ("EITF")
03-6-1,
"
Determining Whether Instruments Granted in Share-Based
    Payment Transactions Are Participating Securities
". FSP
EITF 03-6-1
addresses whether instruments granted in share-based payment
    transactions are participating securities prior to vesting and,
    therefore, need to be included in the earnings allocation in
    computing earnings per share under the two-class method. This
    FSP is effective for financial statements issued for fiscal
    years beginning after December 15, 2008 and interim periods
    within those years. The Company adopted this FSP effective
    January 1, 2009. See Note 15.
In April 2009, the FASB issued FSP
SFAS 107-1
and Accounting Principles Board (APB)
28-1,
"
Interim Disclosures about Fair Value of Financial
    Instruments
". This FSP, which amends
    SFAS No. 107, "
Disclosures about Fair Value of
    Financial Instruments
", requires publicly-traded
    companies, as defined in APB Opinion No. 28,
    "
Interim Financial Reporting
", to provide
    disclosures on the fair value of financial instruments in
    interim financial statements. Since FSP
SFAS 107-1
requires only additional disclosures concerning the financial
    instruments, the adoption of FSP
SFAS 107-1
effective June 30, 2009, did not have a material impact on
    the condensed consolidated financial statements.
In May 2009, the FASB issued SFAS No. 165,
    "
Subsequent Events
"
    ("SFAS 165"). SFAS No. 165 establishes
    general standards of accounting for and disclosures of
    subsequent events that occur after the balance sheet date but
    prior to the issuance of financial statements. The statement
    requires additional disclosure regarding the date through which
    subsequent events have been evaluated by the entity as well as
    whether that date is the date the financial statements were
    issued. This statement became effective for the Company's
    financial statements as of June 30, 2009. The Company has
    evaluated its subsequent events after the balance sheet date of
    June 30, 2009 through September 24, 2009.
In June 2009, FASB issued SFAS No. 168,
"The
    FASB Accounting Standards Codification and the Hierarchy of
    Generally Accepted Accounting Principles, a replacement of FASB
    Statement No. 162
(or
    "SFAS No. 168"). SFAS No. 168
    identifies the sources of accounting principles and the
    framework for selecting the principles to be used in the
    preparation of financial statements that are presented in
    conformity with generally accepted accounting principles in the
    United States. SFAS No. 168 is effective for financial
    statements issued for interim and annual periods ending after
    September 15, 2009. The Company does not expect the
    adoption of SFAS No. 168 to have a significant impact
    on its consolidated financial statements.
3.
Net Services
    Revenue
The Company's net services revenue consisted of the
    following for each of the three years ending December 31,
    and six months ended June 30 (in thousands):
Six Months
Ended June 30,
2006
2007
2008
2008
2009
(Unaudited)
Net base fees for managed service contracts
$
149,529
$
212,086
$
350,085
$
167,085
$
205,017
Incentive payments for managed service contracts
9,784
25,491
38,971
16,483
27,018
Other services
1,428
3,148
9,413
3,693
6,114
Total
$
160,741
$
240,725
$
398,469
$
187,261
$
238,149
F-13
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
4.
Infused
    Management and Technology Expenses
Infused management and technology expenses consist primarily of
    the wages, bonuses, benefits, share based compensation, travel
    and other costs associated with deploying the Company's
    employees on customer sites to guide and manage customers'
    revenue cycle operations. The employees that the Company deploys
    on customer sites typically have significant experience in
    revenue cycle operations, technology, quality control or other
    management disciplines. The other significant portion of these
    expenses is an allocation of the costs associated with
    maintaining, improving and deploying the Company's
    integrated proprietary technology suite and an allocation of the
    amortization relating to software development costs capitalized.
5.
Segments and
    Concentrations
All of the Company's significant operations are organized
    around the single business of providing end-to-end management
    services of revenue cycle operations for
U.S.-based
hospitals and other medical providers. Accordingly, for purposes
    of disclosure under SFAS No. 131,
Disclosure about
    Segments of an Enterprise and Related Information
, the
    Company has only one operating and reporting segment.
All of the Company's net services revenue and trade
    accounts receivable are derived from healthcare providers
    domiciled in the United States.
While managed independently and governed by separate contracts,
    several of the Company's customers are affiliated with a
    single health care system, Ascension Health. Pursuant to the
    Company's master services agreement with Ascension Health,
    the Company provides services to Ascension Health's
    affiliated hospitals that execute separate contracts with the
    Company. The Company's aggregate net services revenue from
    these hospitals was $142.6 million, $214.2 million,
    $281.7 million, $136.7 million, and
    $151.6 million during the years ended December 31,
    2006, 2007 and 2008, and six months ended June 30, 2008,
    and 2009, respectively.
In addition, another customer, which is not affiliated with
    Ascension Health, accounted for 11.5% of the Company's
    total net services revenue in the six months ended June 30,
    2008 and 10.6% of the Company's total net services revenue
    in the year ended December 31, 2008. No other customer
    accounted for more than 10% of the Company's total net
    services revenue in any of the periods presented.
6.
SureDecisions
    Acquisition
The Company acquired SureDecisions pursuant to an Agreement and
    Plan of Merger dated May 1, 2006, and SureDecisions became
    a wholly-owned subsidiary of the Company. The Company acquired
    SureDecisions for $1.6 million in cash and
    99,757 shares of the Company's Series C common
    stock valued at $5.26 per share. The resulting total purchase
    price was $2.1 million. The acquisition was accounted for
    using the purchase method of accounting. As a result, the assets
    acquired and liabilities assumed were recorded at estimated fair
    value.
The merger agreement provided for adjustments in the purchase
    price based on a final determination of SureDecisions net
    working capital as of the date of the acquisition. This final
    determination was completed during 2007 and resulted in a
    $0.4 million purchase price reduction, which was recorded
    as a reduction in goodwill.
The merger agreement also provided for potential earn-out
    payments at the first three anniversaries of the acquisition if
    certain operational targets were met. The actual first year
    earn-out payment was $0.9 million, consisting of
    $0.6 million in cash and 39,899 shares of
    Series C common stock valued at $8.20 per share. The
    Company recorded the first year earn-out as an increase in
    goodwill.
F-14
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
The operational targets relating to earn-outs were not achieved
    in the second or third years, and, accordingly, the Company made
    no further earn-out payments.
The following table sets forth the final purchase price
    allocation, adjusted for the purchase price adjustment and first
    year earn-out payment (in thousands):
Receivables related to income taxes
$
939
Other current assets
509
Property and equipment
85
Noncompete agreements
66
Software
779
Trade name
107
Customer relationships
224
Goodwill
1,468
Liabilities related to income taxes
(939
)
Other current liabilities
(559
)
Total
$
2,679
The Company's consolidated statement of operations for the
    year ended December 31, 2006 includes results for
    SureDecisions for the period from May 2, 2006 to
    December 31, 2006. A pro forma presentation of the
    Company's consolidated statement of operations that
    includes results for SureDecisions for the period beginning
    January 1, 2006 would not be materially different from the
    consolidated results presented herein.
The following table sets forth a reconciliation of the amount
    recorded as goodwill during the year ended December 31,
    2007 (in thousands):
Balance as of December 31, 2006
$
930
Increase due to year one earn-out
910
Decrease due to working capital adjustments
(372
)
Balance as of December 31, 2007
$
1,468
There were no changes in goodwill during the year ended
    December 31, 2008, or during the six months ended
    June 30, 2009.
Pursuant to the merger agreement, the prior stockholders of
    SureDecisions, a majority of which are now employees of the
    Company, are obligated to indemnify the Company for federal and
    state income taxes related to periods up to and including the
    date of the acquisition. The net amount due to the Company
    related to this indemnity was $0.9 million,
    $1.3 million and $1.3 million, as of December 31,
    2007 and 2008, and June 30, 2009, respectively, and is
    presented as "Due from Related Party" in the
    consolidated balance sheets. This amount is secured by
    139,671 shares of the Company's Series C common
    stock held in escrow.
F-15
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
7.
Furniture and
    Equipment
Furniture and equipment consist of the following (in thousands):
Year Ended
Six Months
December 31,
Ended June 30,
2007
2008
2009
(Unaudited)
Construction in progress
$
—
$
113
$
196
Capitalized software
3,504
8,443
10,587
Computer equipment
1,323
2,120
2,631
Leasehold improvements
1,107
1,117
1,143
Other equipment
111
621
625
Office furniture
579
742
798
6,624
13,156
15,980
Less accumulated depreciation
(2,058
)
(4,243
)
(6,105
)
$
4,566
$
8,913
$
9,875
8.
Impairment
    Loss
In 2008, the Company determined that the customers served by
    SureDecisions at the time of its acquisition by the Company were
    unlikely to generate significant future revenues. As a result,
    management considered the customer relationships intangible
    asset to be impaired and have no future economic value.
    Therefore, the $0.1 million remaining net book value of
    this asset was charged to amortization expense at
    December 31, 2008, which is included in selling, general,
    and administrative expenses in the consolidated statement of
    operations. There have been no further impairments through
    June 30, 2009.
9.
Non-Executive
    Employee Promissory Notes
In March 2006, certain non-executive employees of the Company
    exercised options to purchase an aggregate of
    1,083,201 shares of Series C common stock. To
    facilitate this stock option exercise, the Company permitted
    these employees to deliver promissory notes to the Company
    representing the exercise price related to these option
    exercises. The aggregate amount loaned to employees for this
    purpose was approximately $0.4 million. Certain employees
    elected under Section 83(b) of the Internal Revenue Code to
    be taxed on the difference between the stock's fair value
    at the purchase date and the option exercise price. In addition,
    pursuant to the promissory notes, the Company advanced an
    additional $0.1 million to such employees to facilitate the
    payment of such federal and state income tax obligations.
Each of the individual promissory notes bears interest at 5% per
    annum. The principal of each note is payable annually in five
    equal installments, commencing on March 1, 2007. Each
    promissory note is secured by the shares of the Company's
    Class C common stock associated with the employee's
    stock option exercise. If an employee sells any shares issued
    pursuant to his or her stock option exercise, then a pro rata
    portion of the associated promissory note becomes immediately
    due. Any unpaid balance on an employee's promissory note
    becomes due and payable 60 days after such employee ceases
    to work for the Company.
The amounts receivable from these notes, $0.3 million,
    $0.3 million, and $0.2 million at December 31,
    2007, 2008, and June 30, 2009, respectively, have been
    deducted from stockholders' equity.
F-16
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
10.
Stockholders'
    Equity
Preferred
    Stock
Dividend
    Rights
The holders of Series A and Series D preferred stock
    are not entitled to receive any dividends unless declared by the
    Company's Board of Directors (the "Board"). In
    the event the Board declares a dividend on any shares of common
    stock, the holders of Series A and Series D preferred
    stock are entitled to receive a dividend on the same terms and
    at the same rate.
Liquidation
    Preference
Upon liquidation, the Series A and Series D
    stockholders rank equally with each other and senior to common
    stockholders and to all other classes or series of stock issued
    by the Company, except such classes or series of stock that rank
    pari passu with or senior to the Series A and Series D
    stock and such ranking is approved by a majority of the
    Series A and a majority of the Series D preferred
    stockholders. Upon liquidation, each holder of Series A and
    Series D preferred stock is entitled to receive an amount
    per share equal to the original purchase price plus any accrued
    but unpaid dividends (the "Termination Amount"). All
    assets remaining available for distribution will be distributed
    ratably to the holders of common stock, Series A preferred
    stock and Series D preferred stock. In the event the assets
    available for distribution to the holders of the Series A
    and Series D preferred stock are insufficient to pay in
    full the Termination Amount, the available assets will be
    distributed to such holders in proportion to the full amount
    each holder is entitled to receive.
In the event of a qualifying public offering, as defined in the
    Company's fourth Amended and Restated Certification of
    Incorporation, the Company must pay to each holder of
    Series A and Series D preferred stock an amount in
    cash equal to the Termination Amount, unless at the
    stockholder's option, the holder chooses to receive shares
    of common stock valued at the per common share price offered in
    the qualifying public offering. As discussed below, holders of
    Series A preferred stock and Series D preferred stock
    may also convert their shares into shares of common stock at the
    time of the offering.
Neither the Series A preferred stock nor the Series D
    preferred stock is redeemable.
Voting
    Rights
Holders of each Series A preferred stock and Series D
    preferred stock have the right to a number of votes equal to the
    number of shares of Series B common stock that are issuable
    upon conversion of such share of Series A preferred stock
    and Series D preferred stock.
Conversion
    Rights
Holders of Series A preferred stock have the right to
    convert the Series A preferred stock at any time into
    shares of Series B common stock at the rate of the original
    purchase price divided by the conversion price, subject to
    adjustment. Holders of the Series D preferred stock have
    the right to convert the Series D preferred stock at any
    time into shares of Series B common stock at the rate of
    the original purchase price divided by the conversion price,
    subject to adjustment.
As of December 31, 2008 and June 30, 2009, each
    outstanding share of Series A preferred stock was
    convertible into 306.5 shares of Series B common stock
    and each share of Series D preferred stock was convertible
    into one share of Series B common stock.
F-17
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
Common
    Stock
The Company is authorized to issue 25,500,000 shares of
    common stock, of which 17,500,000 are designated as
    Series B common stock and 8,000,000 are designated as
    Series C common stock. The Company has reserved 14,436,863
    and 14,916,864 shares at December 31, 2008 and
    June 30, 2009, respectively, for the issuance of common
    stock upon exercise of outstanding stock options and warrants,
    and conversion of shares of Series A preferred stock and
    Series D preferred stock
Each share of Series B common stock is entitled to one
    vote. Shares of Series C common stock have no voting
    privileges. Holders of Series B common stock and
    Series C common stock are entitled to receive dividends
    when and if declared by the Board, subject to the prior rights
    of holders of all classes of stock outstanding. All of the
    Company's outstanding common stock at December 31,
    2007 and 2008, and June 30, 2009, is restricted with regard
    to transfer rights.
Restricted
    Stock Plan
In March 2004, the Board authorized the Company's
    Restricted Stock Plan. The Restricted Stock Plan provides for
    the grant of restricted Series B or Series C common
    stock to employees, directors, and outside consultants. The
    Company's Board, or a committee designated by the Board
    administers the Restricted Stock Plan and has authority to
    determine the terms and conditions of awards, including the
    number of shares subject to each award, the vesting schedule of
    the awards, and the selection of grantees.
Series B
    Common Stock
In March 2004, the Company awarded 3,000,000 restricted shares
    of Series B common stock, having a fair market value on
    that date of $0.0256 per share to an employee under the
    Restricted Stock plan. The shares vested over four years,
    beginning in November 2003, subject to the employee's
    continued employment. Stock-based compensation expense of
    $0.02 million and
$0.02 million
was recorded for the years ended December 31, 2006 and 2007.
In June 2007, the Company issued and sold 669,284 restricted
    shares of Series B common stock to a customer for an
    aggregate price of $5.5 million under the Restricted Stock
    Plan.
Series C
    Common Stock
In June 2004, the Company issued 3,175,000 restricted shares of
    Series C common stock, having a fair market value on that
    date of $0.0256 per share to certain employees and directors
    under the Restricted Stock Plan. In January 2005, 90,000
    restricted shares of Series C common stock, having a fair
    market value on that date of $1.03 per share, were issued to a
    director under the Restricted Stock Plan. The shares have
    various vesting schedules ranging from immediate vesting to
    vesting over a period of 48 months, subject to continued
    employment or service on the Board. Stock compensation expense
    of $0.03 million, $0.02 million was recorded in 2006
    and 2007 related to these awards.
Exchange of
    Series B and Series Class C Restricted Common
    Stock
Effective December 2008, the Company and certain employees and
    directors entered into an agreement pursuant to which such
    employees and directors exchanged a total of
    3,309,951 shares of Series C common stock for a like
    number of Series B common stock.
F-18
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
Dividends
The Company paid a cash dividend in the aggregate amount of
    $15.0 million or $0.7203 per common equivalent share to
    holders of record as of July 11, 2008 of the Company's
    common stock and preferred stock.
In August 2009, the Company declared an additional cash dividend
    in the aggregate amount of $15.0 million, or $0.72 per
    common equivalent share to holders of record as of
    September 1, 2009 of the Company's common stock and
    preferred stock.
Warrants
Effective in October 2004, the Company entered into a
    Supplemental Warrant Agreement with Ascension Health, its
    founding customer, which provided for the right to purchase up
    to 902,374 shares of Series B common stock based upon
    the achievement of specified milestones relating to the
    customer's sales and marketing assistance. The purchase
    price of the shares is equal to the most recent per share price
    of the Company's Series B common stock in a capital
    raising transaction or, if there has not been a capital raising
    transaction within the preceding six months, the exercise price
    of the Company's most recently granted employee stock
    options.
In May 2007, the Company and Ascension Health, its founding
    customer, agreed to amend and restate the Supplemental Warrant
    Agreement to reduce the number of shares covered by the warrant
    to 446,190.
The Supplemental Warrant Agreement, and all individual warrants
    issued thereunder, expire on the earlier of November 7,
    2014, or the effective date of an initial public offering.
During December 2007, the founding customer earned the right to
    purchase 223,095 shares of Series B common stock under
    the Amended Supplemental Warrant Agreement. The warrants have an
    exercise price of $17.36 per share. The Company recorded
    $4.2 million as marketing expenses in the 2007 financial
    statements in conjunction with the issuance of this warrant.
During March 2008, the founding customer earned the right to
    purchase 111,548 shares of Series B common stock under
    the Amended Supplemental Warrant Agreement. The warrants have an
    exercise price of $40.17 per share. The Company recorded
    $2.4 million as marketing expenses in the 2008 financial
    statements in conjunction with the issuance of this warrant.
During March 2009, the founding customer earned the right to
    purchase 111,547 shares of Series B common stock under
    the Amended Supplemental Warrant Agreement. The warrants have an
    exercise price of $51.05 per share. The Company recorded
    $2.8 million as marketing expenses for the six months ended
    June 30, 2009 in conjunction with the issuance of this
    warrant.
Effective November 2004, the Company entered into a Protection
    Warrant Agreement with the founding customer whereby the Company
    granted the customer anti-dilution rights by entering into an
    agreement whereby the founding customer is granted warrants to
    purchase the Company's Series B common stock from time
    to time at an exercise price of $0.01 per share when the
    customer's ownership percentage declines as a result of the
    Company offering more common share equivalents. The Protection
    Warrant Agreement, and all individual warrants issued
    thereunder, expire on the earlier of November 7, 2014, or
    the effective date of an initial public offering.
In the years ended December 31, 2006, 2007, and 2008, and
    the six months ended June 30, 2008 and 2009, warrants to
    purchase 15,752, 58,175, 23,261, 19,358 and 25,837 shares
    of Series B common stock, respectively, were earned under
    the Protection Warrant. As a result of this award,
F-19
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
revenue recorded was reduced by $0.1 million,
    $0.9 million, $0.9 million, $0.7 million, and
    $1.3 million in 2006, 2007 and 2008, and for the six months
    ended June 30, 2008 and 2009, respectively.
During the year ended December 31, 2007 and the six months
    ended June 30, 2008 and 2009, the founding customer
    purchased 213,100, 66,652 and 16,758 shares of the
    Company's Series B common stock, respectively, for
    $0.01 per share, pursuant to the Protection Warrant Agreement.
    As of June 30, 2009, the founding customer has the right to
    purchase an additional 23,863 shares for $0.01 per share
    under the agreement.
In conjunction with the start of its business, in February 2004,
    the Company executed a term sheet with a consulting firm and its
    principal contemplating that the Company would grant the
    consulting firm a warrant, with an exercise price equal to the
    fair market value of the Company's common stock upon grant,
    to purchase shares of the Company's common stock then
    representing 2.5% of the Company's equity in exchange for
    exclusive rights to certain revenue cycle methodologies, tools,
    technology, benchmarking information and other intellectual
    property, plus up to another 2.5% of the Company's equity
    at the time of grant if the consulting firm's introduction
    of us to senior executives at prospective customers resulted in
    the execution of managed service contracts between us and such
    customers. In January 2005, we formalized the warrant grant
    contemplated by the term sheet and granted the consulting firm a
    warrant to purchase 833,334 shares of the Company's
    Series C common stock for $1.12 per share, representing
    5.0% of the Company's equity at that time. In 2005, the
    Company recorded $483,334 in selling, general and administrative
    expense in conjunction with this warrant grant. The warrant
    expires on the earlier of January 15, 2015 or a change of
    control of the Company.
The Company uses the modified Black-Scholes option pricing model
    to determine the estimated fair value of all of the above
    warrants at the date granted. The significant assumptions used
    in the model were:
Year Ended December 31,
Six Months Ended
2006
2007
2008
June 30, 2009
(Unaudited)
Future dividends
—
—
—
—
Risk-free interest rate
3.9% to 5.2%
2.75% to 4.21%
3.45%
2.91%
Expected volatility
60%
50%
50%
50%
Expected life
7.8 years
6.8 years
6.6 years
5.6 years
Stock
    Options
In December 2003, the Board approved a stock option plan, which
    provides for the grant of stock options to employees, directors
    and consultants. The plan was amended and restated in February
    2006. As of June 30, 2009, the plan permitted the issuance
    of a maximum of 3,544,862 shares of common stock and
    173,828 shares were available for grant. Under the terms of
    the plan, all options will expire if they are not exercised
    within ten years after the grant date. Substantially all of the
    options granted vest over four years at a rate of 25% per year
    on each grant date anniversary. Options can be exercised
    immediately upon grant, but upon exercise the shares issued are
    subject to the same vesting and repurchase provisions that
    applied before exercise.
Prior to January 1, 2006, the Company accounted for
    share-based compensation using the intrinsic value method
    prescribed in Accounting Principles Board Opinion No. 25,
Accounting for Stock Issued to Employees
, and related
    interpretations, as permitted by Statement of Financial
    Accounting Standards No. 123,
Accounting for Stock-Based
    Compensation
. Accordingly, compensation expense
F-20
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
for stock options was measured as the excess, if any, of the
    fair market value of the Company's common stock at the
    measurement date (the date of grant for stock options) over the
    exercise price. Since the Company only granted employee stock
    options with an exercise price equal to fair market value on the
    date of grant, the Company did not record any compensation
    expense for stock option grants prior to January 1, 2006.
Effective January 1, 2006, the Company adopted the fair
    value recognition provisions of SFAS 123(R) using the
    modified prospective transition method. Under this method:
•
compensation expense for share-based awards granted prior to
    January 1, 2006 is recognized over the remaining service
    period based on the grant date fair value estimated in
    accordance with the original provisions of
    SFAS 123; and
•
compensation expense for all share-based awards granted
    subsequent to December 31, 2005 is recognized over the
    service period based on the grant date fair value estimated in
    accordance with the provisions of SFAS 123(R).
The Company uses the modified Black-Scholes option pricing model
    to determine the estimated fair value of each option as of its
    grant date. These inputs are subjective and generally require
    significant analysis and judgment to develop. The following
    table sets forth the significant assumptions used in the model
    during 2006, 2007 and 2008 and the six months ended
    June 30, 2009:
Year Ended December 31,
Six Months Ended
2006
2007
2008
June 30, 2009
(Unaudited)
Future dividends
—
—
—
—
Forfeitures
1.88% annually
7.5% annually
3.75% annually
3.75% annually
Risk-free interest rate
3.9% to 5.2%
2.3% to 5.5%
2.8 to 4.0%
1.6% to 2.4%
Expected volatility
60%
50%
50%
50%
Expected life
6.25 years
6.25 years
6.25 years
6.25 years
Since the Company's stock is not actively traded, the
    Company's management estimated its expected volatility by
    reviewing the historical volatility of the common stock of
    public companies that operate in similar industries or are
    similar in terms of stage of development or size and then
    projecting this information toward its future expected results.
    Judgment was used in selecting these companies, as well as in
    evaluating the available historical and implied volatility for
    these companies.
All employees were aggregated into one pool for valuation
    purposes. The risk-free rate is based on the U.S. treasury
    yield curve in effect at the time of grant.
The plan has not been in existence a sufficient period for the
    Company's historical experience to be used when estimating
    expected life. Furthermore, data from other companies is not
    readily available. Therefore, the expected life of each stock
    option was calculated using a simplified method based on the
    average of each option's vesting term and original
    contractual term. This methodology is set forth in Staff
    Accounting Bulletin No. 107 and its use is permitted
    by Staff Accounting Bulletin No. 110.
The estimated forfeiture rate is derived from the Company's
    historical data and its estimates of the likely future actions
    of option holders.
F-21
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
The following table sets forth a summary of option activity
    under the Plan for the years ended December 31, 2006, 2007,
    and 2008 and the six months ended June 30, 2009:
Weighted-
Weighted-
Average
Average
Remaining
Exercise
Contractual
Aggregate
Shares
Price
Term
Intrinsic Value
(In thousands)
Outstanding at January 1, 2006
1,694,879
$
1.85
Granted
779,000
4.96
Exercised — vested
(264,184
)
1.41
Exercised — non-vested
(819,017
)
2.40
Forfeited
(188,250
)
2.08
Outstanding at December 31, 2006
1,202,428
3.55
8.8
$
4,270
Granted
768,030
13.36
Exercised — vested
(16,021
)
2.42
Exercised — non-vested
(37,148
)
13.08
Forfeited
(176,229
)
3.44
Outstanding at December 31, 2007
1,741,060
7.69
8.5
$
13,397
Granted
443,000
41.25
Exercised — vested
(3,750
)
4.74
Exercised — non-vested
(8,550
)
15.51
Forfeited
(90,250
)
8.69
Outstanding at December 31, 2008
2,081,510
$
14.77
7.9
$
30,734
Outstanding and vested at December 31, 2008
856,428
$
5.08
5.1
4,348,120
(Unaudited)
Granted
439,500
51.70
Exercised — vested
(20,000
)
7.38
Exercised — non-vested
(1,250
)
3.15
Forfeited
(58,875
)
10.51
Outstanding at June 30, 2009
2,440,885
21.59
7.8
$
52,688
Outstanding and vested at June 30, 2009
1,054,930
8.52
6.8
$
8,987
Amounts received by the Company from the exercise of unvested
    stock options are classified as accrued expenses until vesting
    occurs. The share amounts in the chart above include vested and
    unvested exercises.
The weighted-average grant date fair value of options granted in
    the years ended December 31, 2006, 2007 and 2008, and the
    six months ended June 30, 2008 and 2009, was $4.96, $13.36,
    $41.25, $36.46 and $51.70 per share, respectively. The total
    intrinsic value of the options exercised in the years ended
    December 31, 2006, 2007 and 2008, and the six months ended
    June 30, 2008 and 2009 was $2.4 million,
    $0.5 million, $0.2 million, $0.2 million, and
    $0.2 million, respectively.
Total share-based compensation cost recognized for the years
    ended December 31, 2006, 2007 and 2008, and the six months
    ended June 30, 2008 and 2009 was $0.8 million,
    $0.9 million, $3.6 million, $1.0 million, and
    $3.0 million, respectively, with related income tax
    benefits of
F-22
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
approximately
$0.3 million, $0.4 million, $1.4 million,
    $0.4 million, and $1.0 million, respectively. As of
    December 31, 2008 and June 30, 2009 there was $10.9
    and $18.1 million of total unrecognized share-based
    compensation cost related to stock options granted under the
    Plan, respectively, which the Company expects to recognize over
    a weighted-average period of 3.1 years.
11.
401
    (k) Retirement Plan
The Company maintains a 401(k) retirement plan that is intended
    to be a tax-qualified defined contribution plan under
    Section 401(k) of the Internal Revenue Code. In general,
    all employees are eligible to participate. The 401(k) plan
    includes a salary deferral arrangement pursuant to which
    participants may elect to reduce their current compensation by
    up to the statutorily prescribed limit, equal to $16,500 in
    2009, and have the amount of the reduction contributed to the
    401(k) plan. The Company currently matches employee
    contributions up to 50% of the first 3% of base compensation
    that a participant contributes to the plan. In 2006, 2007 and
    2008, and for the six months ended June 30, 2008 and 2009,
    employees who were Directors, Vice President, or higher levels
    were excluded from the matching contribution feature of the
    plan. For the years ended December 31, 2006, 2007 and 2008,
    and for the six months ended June 30, 2008 and 2009, total
    Company contributions to the plan were $.01 million,
    $0.1 million, $0.2 million, $0.1 million, and
    $0.1 million, respectively.
12.
Operating
    Leases
The Company rents office space and equipment under a series of
    operating leases, primarily for its Chicago corporate office and
    India operations. Lease payments are amortized to expense on a
    straight-line basis over the lease term. As of December 31,
    2008, the Chicago corporate office consisted of approximately
    28,000 square feet in a multi-story office building. The
    Company has an option to cancel the lease effective
    November 30, 2011 if the landlord is unable, prior to
    December 31, 2010, to provide approximately
    22,000 square feet of additional office space on an
    adjacent floor. If the landlord provides this additional office
    space and the Company does not concurrently exercise the option
    to return approximately 6,500 square feet of office space
    on a non-adjacent floor, the lease for all 50,000 feet will
    be extended until ten years and 90 days after the date the
    Company takes possession of the additional 22,000 square
    feet of office space, and the minimum lease payments will
    increase by approximately $0.6 million per year.
The Company's financial institution has issued a
    $0.2 million irrevocable letter of credit to the landlord
    on behalf of the Company. This letter of credit serves as a
    security deposit for payment of the Company's obligations
    under the lease. As of December 31, 2008, the Company had
    set aside $0.2 million to guarantee its obligation to repay
    the financial institution in the event that the financial
    institution is required to perform under the letter of credit.
    This amount is included in cash in the Company's
    consolidated balance sheet.
Total rent expense was $0.6 million, $0.6 million,
    $1.0 million, $0.6 million, and $0.8 million in
    the years ended December 31, 2006, 2007 and 2008, and the
    six months ended June 30, 2008 and 2009, respectively.
F-23
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
At December 31, 2008, the aggregate minimum lease
    commitments under all noncancelable operating leases are as
    follows (in thousands):
2009
$
1,218
2010
824
2011
758
2012
329
2013
258
Thereafter
534
Total
$
3,921
13.
Income
    Taxes
For the years ended December 31, 2007 and 2008, the
    Company's tax provision consists of the following (in
    thousands):
Current
Deferred
Total
Year ended December 31, 2007:
U.S. federal
$
141
$
—
$
141
State and local
312
—
312
Foreign
3
—
3
$
456
$
—
$
456
Year ended December 31, 2008:
U.S. federal
$
66
$
—
$
66
State and local
2,177
—
2,177
Foreign
21
—
21
$
2,264
$
—
$
2,264
For the year ended December 31, 2006, the Company incurred
    a net loss and recorded a full valuation allowance on the net
    deferred tax benefit. As a result, there was no tax provision
    for the year ended December 31, 2006.
Income tax expense was $0.5 million and $2.3 million
    for the years ended December 31, 2007 and 2008,
    respectively, and differed from the amounts computed by applying
    the U.S. federal income tax rate of 34% to pretax income as
    a result of the following:
2007
2008
Federal statutory tax rate
34
%
34
%
Increase (reduction) in income tax rate resulting from:
Change in the valuation allowance
(11
)
(15
)
India tax holiday
(2
)
(5
)
Meals and entertainment and other permanent differences
6
3
Alternative minimum tax
11
(4
)
State and local income taxes, net of federal benefits
17
42
Anti-dilution warrants issued to customers
—
9
Change in tax rate
(18
)
—
Other, net
—
1
Actual tax rate
37
%
65
%
F-24
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
The following table sets forth the Company's net deferred
    tax assets (liabilities) as of December 31, 2007 and 2008
    (in thousands):
2007
2008
Deferred tax assets:
Alternative minimum tax credit
carryover
$
34
$
241
Net operating loss carryforwards
2,491
2,538
Employee stock compensation
234
1,407
Stock warrants
2,553
2,855
Charitable contributions
—
105
Other
28
57
Total gross deferred tax assets
5,340
7,203
Less valuation allowance
(4,733
)
(3,629
)
Net deferred tax assets
607
3,574
Deferred tax liabilities:
Deferred revenue
—
(2,471
)
Fixed assets and intangibles
(607
)
(1,103
)
Total deferred tax liabilities
(607
)
(3,574
)
Net deferred tax liability
$
—
$
—
As of December 31, 2008, the Company had provided a
    valuation allowance for the full amount of its net deferred tax
    assets because its cumulative net tax loss during the three-year
    period ended December 31, 2008 resulted in management
    concluding that it was not more likely than not that the net
    deferred tax asset will be realized.
Income taxes for the six months ended June 30, 2008 and
    June 30, 2009 amounted to an expense of $0.6 million
    and a tax benefit of $2.4 million, respectively. During the
    six months ended June 30, 2009 the Company reduced the
    valuation allowance recorded against the Company's deferred
    tax assets due to a change in the estimate of the future
    utilization by the management. The reduction resulted in a tax
    benefit of $3.5 million.
At December 31, 2008, the Company has cumulative federal
    net operating loss carryforwards of approximately
    $7.1 million, which expire beginning in 2025. As of
    December 31, 2008, the Company had net operating loss
    carryforwards for state income tax purposes of
    $0.1 million, which are available to offset future taxable
    income in certain states. In addition, as of December 31,
    2008, the Company had alternative minimum tax credit
    carryforwards of $0.2 million, which are available to
    reduce future federal regular tax, if any, over an indefinite
    period.
The Company has not recognized a deferred tax liability for the
    undistributed earnings of its foreign subsidiary that arose in
    2007 and 2008 because the Company considers these earnings to be
    indefinitely reinvested outside of the United States. As of
    December 31, 2007 and 2008, and the six months ended
    June 30, 2009, the undistributed earnings of this
    subsidiary were $0.1 million, $0.5 million, and
    $0.6 million, respectively.
Under the provisions of the Internal Revenue Code, certain
    substantial changes in the Company's ownership may result
    in a limitation on the amount of net operating loss
    carryforwards that can be used in future years.
F-25
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
The Company's uncertain tax positions as of
    December 31, 2008, totaled $0.2 million. The following
    table summarizes the activity related to the unrecognized tax
    benefits during 2008 (in thousands):
Unrecognized tax benefits as of December 31, 2007
$
319
Increases in positions taken in a current period
84
Unrecognized tax benefits as of December 31, 2008
$
403
As of December 31, 2008, approximately $0.3 million of
    the total gross unrecognized tax benefits represented the amount
    that, if recognized, would result in a reduction of the
    effective income tax rate in future periods.
During the six months ended June 30, 2009, the Company
    recognized an increase in its liability for uncertain tax
    positions of $0.1 million. The Company does not anticipate
    the total amount of unrecognized tax positions will
    significantly increase or decrease in the subsequent twelve
    months. The Company and its subsidiaries are subject to
    U.S. federal income tax as well as income tax of multiple
    state and foreign jurisdictions. U.S. federal income tax
    returns for 2006 through 2008 are currently open for
    examination. State jurisdictions vary for open tax years. The
    statute of limitations for most states ranges from 3 to
    6 years.
The Company recognizes interest and penalties related to income
    tax matters as income tax expense. The Company recorded
    adjustments to interest and potential penalties related to these
    unrecognized tax benefits during 2008, and in total, as of
    December 31, 2008, the Company has recorded a liability for
    interest and potential penalties of $0.02 million.
14.
Legal
    Proceedings
From time to time, the Company has been and may again become
    involved in legal proceedings or regulatory investigations
    arising in the ordinary course of business. The Company is not
    presently a party to any material litigation and the
    Company's management is not aware of any pending or
    threatened litigation that could have a material adverse effect
    on the Company's business, operating results, financial
    condition or cash flows.
15.
Earnings (Loss)
    Per Common Share
Earnings per share ("EPS") is calculated in accordance
    with Statement of Financial Accounting Standards
    ("SFAS") No. 128,
Earnings Per Share
("SFAS 128"), and EITF Issue
No. 03-06,
Participating Securities and the Two-Class Method Under
    SFAS No. 128
, and FASB Staff Position (FSP)
No. EITF 03-06-01,
Determining Whether Instruments Granted in Share-Based
    Payment Transactions Are Participating Securities
("FSP
EITF 03-06-01").
FSP
EITF 03-6-1 states
that unvested share-based payment awards that contain
    nonforfeitable rights to dividends or dividend equivalents
    (whether paid or unpaid) are participating securities and shall
    be included in the computation of earnings per share pursuant to
    the two-class method.
Under the two-class method, earnings are allocated between
    common stock and participating securities. FSP
EITF 03-6-1
provides guidance that the presentation of basic and diluted
    earnings per share is required only for each class of common
    stock and not for participating securities. The Company's
    Series B and Series C common stock have equal
    participation rights and therefore the Company has presented
    earnings per common share for Series B and Series C
    common stock as one class.
F-26
Table of Contents
Accretive Health,
    Inc.
Notes to
    Consolidated Financial Statements —
    (Continued)
The two-class method includes an earnings allocation formula
    that determines earnings per share for each class of common
    stock according to dividends declared and undistributed earnings
    for the period. The Company's reported net earnings is
    reduced by the amount allocated to participating securities to
    arrive at the earnings allocated to common stock shareholders
    for purposes of calculating earnings per share.
The dilutive effect of participating securities is calculated
    using the more dilutive of the treasury stock or the two-class
    method. The Company has determined the two-class method to be
    the more dilutive. As such, the earnings allocated to common
    stock shareholders in the basic earnings per share calculation
    is adjusted for the reallocation of undistributed earnings to
    participating securities as prescribed by
FSP 03-6-1
to arrive at the earnings allocated to common stock shareholders
    for calculating the diluted earnings per share.
The following table sets forth the computation of basic and
    diluted earnings per share under the two-class method (in
    thousands of dollars, except for share and per share amounts):
Six Months Ended
Years Ended December 31,
June 30,
2006
2007
2008
2008
2009
(unaudited)
Net income (loss) as reported
$
(7,319
)
$
774
$
1,243
$
(594
)
$
5,214
Less: Distributed earnings available to participating securities
—
—
8,148
—
—
Less: Undistributed earnings (loss) available to participating
    securities
(1,450
)
451
(411
)
(20
)
2,862
Numerator for basic earnings (loss) per share -
Undistributed and distributed earnings available to common
    shareholders
(5,869
)
323
(6,494
)
(574
)
2,352
Add: Undistributed earnings (loss) allocated to participating
    securities
(1,450
)
23
(411
)
(20
)
47
Less: Undistributed earnings (loss) reallocated to participating
    securities
(552
)
20
(168
)
(8
)
43
Numerator for diluted earnings per share -
Undistributed and distributed earnings available to common
    shareholders
$
(6,767
)
$
326
$
(6,737
)
$
(586
)
$
2,356
Denominator for basic earnings (loss) per share -
Weighted-average common shares
6,611,975
8,410,226
9,214,916
9,160,187
9,337,812
Effect of dilutive securities
—
1,885,785
—
—
2,154,834
Denominator for diluted earnings (loss) per share -
Weighted-average common shares adjusted for dilutive securities
6,611,975
10,296,011
9,214,916
9,160,187
11,492,646
Earnings (loss) per share:
Basic income (loss) per share
$
(0.89
)
$
0.04
$
(0.70
)
$
(0.06
)
$
0.25
Diluted net income (loss) per share
$
(1.02
)
$
0.03
$
(0.73
)
$
(0.06
)
$
0.21
Because of their anti-dilutive effect, 12,506,716, 13,790,631,
    and 13,281,008 of common share equivalents comprised of
    convertible preferred shares, unvested common stock, warrants
    and unvested stock options, have been excluded from the diluted
    earnings per share calculation for the years ended
    December 31, 2006 and December 31, 2008 and for the
    six months ended June 30, 2008, respectively.
F-27
Table of Contents
Shares
Accretive Health,
    Inc.
Common Stock
Goldman,
    Sachs & Co.
Credit Suisse
J.P.
    Morgan
Morgan Stanley
Table of Contents
Part II
Information Not
    Required in Prospectus
Item 13.
Other Expenses
    of Issuance and Distribution
The following table indicates the expenses to be incurred in
    connection with the offering described in this Registration
    Statement, other than underwriting discounts and commissions,
    all of which will be paid by the Registrant. All amounts are
    estimated except the Securities and Exchange Commission
    registration fee and the FINRA filing fee.
Amount
Securities and Exchange Commission registration fee
$
11,160
Financial Industry Regulatory Authority fee
20,500
New York Stock Exchange listing fee
250,000
Accountants' fees and expenses
*
Legal fees and expenses
*
Financial advisory fee(1)
*
Blue Sky fees and expenses
*
Transfer Agent's fees and expenses
*
Printing and engraving expenses
*
Miscellaneous
*
Total Expenses
$
*
*
To be filed by amendment.
(1)
Consists of a cash fee of $     
    and           shares
    of our common stock valued at
    $          ,
    based on an assumed initial public offering price of
    $      per share, the midpoint of the
    estimated price range shown on the cover of this prospectus.
Item 14.
Indemnification
    of Directors and Officers
Section 102 of the General Corporation Law of the State of
    Delaware permits a corporation to eliminate the personal
    liability of directors of a corporation to the corporation or
    its stockholders for monetary damages for a breach of fiduciary
    duty as a director, except where the director breached his duty
    of loyalty, failed to act in good faith, engaged in intentional
    misconduct or knowingly violated a law, authorized the payment
    of a dividend or approved a stock repurchase in violation of
    Delaware corporate law or obtained an improper personal benefit.
    Our restated certificate of incorporation that will become
    effective upon the closing of this offering provides that no
    director of the Registrant shall be personally liable to it or
    its stockholders for monetary damages for any breach of
    fiduciary duty as director, notwithstanding any provision of law
    imposing such liability, except to the extent that the General
    Corporation Law of the State of Delaware prohibits the
    elimination or limitation of liability of directors for breaches
    of fiduciary duty.
Section 145 of the General Corporation Law of the State of
    Delaware provides that a corporation has the power to indemnify
    a director, officer, employee, or agent of the corporation and
    certain other persons serving at the request of the corporation
    in related capacities against expenses (including
    attorneys' fees), judgments, fines and amounts paid in
    settlements actually and reasonably incurred by the person in
    connection with an action, suit or proceeding to which he is or
    is threatened to be made a party by reason of such position, if
    such person acted in good faith and in a manner he reasonably
    believed to be in or not opposed to the best interests of the
    corporation and, in any criminal action or proceeding, had no
    reasonable cause to believe his conduct was unlawful, except
    that, in the case of actions brought by or in the right of the
    corporation, no indemnification shall be made with respect to
    any claim, issue or matter as to which such person shall have
    been adjudged to be liable to the corporation unless and only to
    the extent that the Court of Chancery or other
II-1
Table of Contents
adjudicating court determines that, despite the adjudication of
    liability but in view of all of the circumstances of the case,
    such person is fairly and reasonably entitled to indemnity for
    such expenses which the Court of Chancery or such other court
    shall deem proper.
Our restated certificate of incorporation provides that we will
    indemnify each person who was or is a party or threatened to be
    made a party to any threatened, pending or completed action,
    suit or proceeding (other than an action by or in the right of
    Accretive Health) by reason of the fact that he or she is or
    was, or has agreed to become, a director or officer of Accretive
    Health, or is or was serving, or has agreed to serve, at our
    request as a director, officer, partner, employee or trustee of,
    or in a similar capacity with, another corporation, partnership,
    joint venture, trust or other enterprise (all such persons being
    referred to as an "Indemnitee"), or by reason of any
    action alleged to have been taken or omitted in such capacity,
    against all expenses (including attorneys' fees),
    judgments, fines and amounts paid in settlement actually and
    reasonably incurred in connection with such action, suit or
    proceeding and any appeal therefrom, if such Indemnitee acted in
    good faith and in a manner he or she reasonably believed to be
    in, or not opposed to, our best interests, and, with respect to
    any criminal action or proceeding, he or she had no reasonable
    cause to believe his or her conduct was unlawful. Our restated
    certificate of incorporation provides that we will indemnify any
    Indemnitee who was or is a party to an action or suit by or in
    the right of Accretive Health to procure a judgment in our favor
    by reason of the fact that the Indemnitee is or was, or has
    agreed to become, a director or officer of Accretive Health, or
    is or was serving, or has agreed to serve, at our request as a
    director, officer, partner, employee or trustee or, or in a
    similar capacity with, another corporation, partnership, joint
    venture, trust or other enterprise, or by reason of any action
    alleged to have been taken or omitted in such capacity, against
    all expenses (including attorneys' fees) and, to the extent
    permitted by law, amounts paid in settlement actually and
    reasonably incurred in connection with such action, suit or
    proceeding, and any appeal therefrom, if the Indemnitee acted in
    good faith and in a manner he or she reasonably believed to be
    in, or not opposed to, the best interests of Accretive Health,
    except that no indemnification shall be made with respect to any
    claim, issue or matter as to which such person shall have been
    adjudged to be liable to us, unless a court determines that,
    despite such adjudication but in view of all of the
    circumstances, he or she is entitled to indemnification of such
    expenses. Notwithstanding the foregoing, to the extent that any
    Indemnitee has been successful, on the merits or otherwise, he
    or she will be indemnified by us against all expenses (including
    attorneys' fees) actually and reasonably incurred in
    connection therewith. Expenses must be advanced to an Indemnitee
    under certain circumstances.
Prior to the closing of this offering, we intend to enter into
    indemnification agreements with each of our directors and our
    executive officers. These indemnification agreements may require
    us, among other things, to indemnify our directors and executive
    officers for some expenses, including attorneys' fees,
    judgments, fines and settlement amounts incurred by a director
    or executive officer in any action or proceeding arising out of
    his service as one of our directors or executive officers, or
    any of our subsidiaries or any other company or enterprise to
    which the person provides services at our request.
We maintain a general liability insurance policy that covers
    certain liabilities of directors and officers of our corporation
    arising out of claims based on acts or omissions in their
    capacities as directors or officers.
In any underwriting agreement we enter into in connection with
    the sale of common stock being registered hereby, the
    underwriters will agree to indemnify, under certain conditions,
    us, our directors, our officers and persons who control us with
    the meaning of the Securities Act of 1933, as amended, against
    certain liabilities.
Item 15.
Recent Sales
    of Unregistered Securities
Set forth below is information regarding our issuances of
    capital stock and our grants of warrants and options to purchase
    shares of capital stock within the past three years. Also
    included is the consideration, if any, received by us for such
    shares, warrants and options and information relating to
II-2
Table of Contents
the section of the Securities Act, or rule of the Securities and
    Exchange Commission, under which exemption from registration was
    claimed.
(a)
Issuances of Capital Stock
(1) In May 2006, we issued an aggregate of
    99,757 shares of non-voting common stock, valued at $5.26
    per share (based on the estimated fair value of the shares on
    that date) for an aggregate value of $524,722, to a total of 15
    former stockholders of SureDecisions, Inc. in connection with
    our acquisition of SureDecisions in May 2006. In June 2007, we
    issued an aggregate of 39,899 additional shares of non-voting
    common stock, valued at $8.20 per share (based on the estimated
    fair value of the shares on that date) for an aggregate value of
    $327,172, as earn-out consideration to the former stockholders
    of SureDecisions.
(2) In May 2007, we issued 669,284 shares of voting
    common stock to Ascension Health at a price of $8.20 per share
    for a total purchase price of $5,488,128.
(3) In December 2008, we issued an aggregate of
    3,309,952 shares of voting common stock in exchange for
    3,309,952 shares of non-voting common stock held by a total
    of 10 of our directors, officers and their affiliates. These
    shares are subject to the terms and conditions set forth in our
    restricted stock plan, the restricted stock award agreements
    entered into between us and our stockholders in connection with
    the original issuance of the shares of non-voting common stock
    and our stockholders' agreement pursuant to which these
    persons have certain registration rights.
No underwriters were involved in the foregoing issuances of
    securities. The shares of common stock described in paragraphs
    (a)(1), (a)(2) and (a)(3) of Item 15 were issued in
    reliance upon the exemption from the registration requirements
    of the Securities Act provided by Section 3(a)(9) or 4(2)
    of the Securities Act as sales by an issuer not involving any
    public offering.
(b)
Warrant Grants and Exercises
Between January 1, 2006 and September 21, 2009, we
    granted warrants to Ascension Health to purchase an aggregate of
    569,215 shares of voting common stock with exercise prices
    ranging from $0.01 per share to $51.05 per share. Between
    January 1, 2006 and September 21, 2009, Ascension
    Health purchased an aggregate of 321,690 shares of voting
    common stock upon warrant exercises for aggregate consideration
    of $3,217.
The warrants and shares of voting common stock issuable upon the
    exercise of the warrants described in this paragraph (b) of
    Item 15 were issued in reliance upon the exemption from the
    registration requirements of the Securities Act provided by
    Section 4(2) of the Securities Act as sales by an issuer
    not involving any public offering.
(c)
Option Grants and Exercises
Between January 1, 2006 and September 21, 2009, we
    granted options to purchase an aggregate of
    2,460,030 shares of non-voting common stock, with exercise
    prices ranging from $3.15 to $58.65 per share, to employees,
    directors and consultants pursuant to our stock option plan.
    Between January 1, 2006 and September 21, 2009, we
    issued an aggregate of 37,948 shares of non-voting common
    stock upon exercise of unvested options for aggregate
    consideration of $232,481 and 1,131,972 shares of
    non-voting common stock upon exercise of vested options for
    aggregate consideration of $2,932,248.
The options and shares of non-voting common stock issuable upon
    the exercise of the options described in this paragraph
    (c) of Item 15 were issued pursuant to written
    compensatory plans or arrangements with our employees, directors
    and consultants in reliance upon the exemption from the
    registration requirements of the Securities Act provided by
    Rule 701 promulgated under the Securities Act. All
    recipients of options and shares pursuant to this exemption
    either received adequate information about us or had access,
    through employment or other relationships, to such information.
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Table of Contents
In some cases, the options and shares of non-voting common stock
    issuable upon the exercise of the options described in this
    paragraph (c) of Item 15 were issued in reliance upon
    the exemption from the registration requirements of the
    Securities Act provided by Section 4(2) of the Securities
    Act and Regulation D promulgated thereunder as sales by an
    issuer not involving any public offering.
All of the foregoing securities are deemed restricted securities
    for purposes of the Securities Act. All certificates
    representing the issued shares of voting common stock and
    non-voting common stock described in paragraphs (a),
    (b) and (c) of Item 15 included appropriate
    legends setting forth that the securities had not been
    registered and the applicable restrictions on transfer.
(d)
Issuance of Shares for Financial Advisory
    Services
Contemporaneously with the closing of this offering and based on
    an assumed initial public offering price of
    $      per share, the midpoint of the
    estimated price range shown on the cover of this prospectus, the
    Registrant will
    issue           shares
    of common stock to Financial Technology Partners, LLC
and/or
FTP
    Securities, LLC in partial payment of a fee due for financial
    advisory services provided in connection with this offering. The
    balance of such fee will be paid in cash, as listed in
    Item 13 above. The financial advisory services of Financial
    Technology Partners, LLC and FTP Securities, LLC included
    assistance in financial and valuation modeling and advice with
    respect to the initial public offering process and equity
    capital market alternatives, and neither Financial Technology
    Partners, LLC nor FTP Securities, LLC acted as an underwriter of
    this offering. The issuance of shares to Financial Technology
    Partners, LLC
and/or
FTP
    Securities, LLC to will be exempt from registration under
    Section 4(2) of the Securities Act. When issued, these
    securities will be deemed restricted securities for purposes of
    the Securities Act, and all certificates representing these
    securities will include appropriate legends setting forth that
    the securities had not been registered and the applicable
    restrictions on transfer.
Item 16.
Exhibits and
    Financial Statement Schedules
(a) Exhibits
The exhibits to the registration statement are listed in the
    Exhibit Index to this registration statement and are
    incorporated by reference herein.
(b) Financial Statement Schedules
Report of
    Independent Registered Public Accounting Firm
The Board of Directors and Shareholders
Accretive Health, Inc.
We have audited the consolidated financial statements of
    Accretive Health, Inc. (formerly Healthcare Services d/b/a
    Accretive Health) as of December 31, 2008 and 2007, and for
    each of the three years in the period ended December 31,
    2008, and have issued our report thereon dated May 20, 2009
    (included elsewhere in this Registration Statement). Our audits
    also included the financial statement schedule listed in
    Item 16(b) of
Form S-1
of this Registration Statement. This schedule is the
    responsibility of the Company's management. Our
    responsibility is to express an opinion based on our audits.
In our opinion, the financial statement schedule referred to
    above, when considered in relation to the basic financial
    statements taken as a whole, presents fairly in all material
    respects the information set forth therein.
/s/ Ernst & Young LLP
Chicago, Illinois
May 20, 2009
II-4
Table of Contents
SCHEDULE II —
    VALUATION AND QUALIFYING ACCOUNTS
Accretive Health, Inc.
December 31, 2008
(In thousands)
Col. A
Col. B
Col. C
Col. D
Col. E
Balance at
Charged to
Beginning of
Costs and
Charged to Other
Balance at
Description
Period
Expenses
Accounts
Deductions
End of Period
Allowance for Doubtful Accounts
Year Ended December 31, 2008
$
432
$
—
$
—
$
350
$
82
Year Ended December 31, 2007
$
72
$
360
$
—
$
—
$
432
Year Ended December 31, 2006
$
—
$
72
$
—
$
—
$
72
Deferred Tax Valuation Allowance
Year Ended December 31, 2008
$
4,733
$
—
$
—
$
1,104
$
3,629
Year Ended December 31, 2007
$
4,867
$
—
$
—
$
134
$
4,733
Year Ended December 31, 2006
$
3,405
$
1,462
$
—
$
—
$
4,867
Item 17.
Undertakings
The undersigned registrant hereby undertakes to provide to the
    underwriters at the closing specified in the underwriting
    agreement, certificates in such denominations and registered in
    such names as required by the underwriters to permit prompt
    delivery to each purchaser.
Insofar as indemnification for liabilities arising under the
    Securities Act of 1933 may be permitted to directors,
    officers and controlling persons of the registrant pursuant to
    the foregoing provisions, or otherwise, the registrant has been
    advised that, in the opinion of the Securities and Exchange
    Commission, such indemnification is against public policy as
    expressed in the Securities Act and is, therefore,
    unenforceable. In the event that a claim for indemnification
    against such liabilities (other than the payment by the
    registrant of expenses incurred or paid by a director, officer
    or controlling person of the registrant in the successful
    defense of any action, suit or proceeding) is asserted by such
    director, officer or controlling person in connection with the
    securities being registered, the registrant will, unless in the
    opinion of its counsel the matter has been settled by
    controlling precedent, submit to a court of appropriate
    jurisdiction the question whether such indemnification by it is
    against public policy as expressed in the Securities Act and
    will be governed by the final adjudication of such issue.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the
    Securities Act, the information omitted from the form of
    prospectus filed as part of this registration statement in
    reliance upon Rule 430A and contained in the form of
    prospectus filed by the registrant pursuant to
    Rule 424(b)(1) or (4) or 497(h) under the Securities
    Act shall be deemed to be part of the registration statement as
    of the time it was declared effective.
(2) For purposes of determining any liability under the
    Securities Act, each post-effective amendment that contains a
    form of prospectus shall be deemed to be a new registration
    statement relating to the securities offered therein, and the
    offering of such securities at that time shall be deemed to be
    the initial bona fide offering thereof.
II-5
Table of Contents
(3) For the purpose of determining liability under the
    Securities Act to any purchaser, each prospectus filed pursuant
    to Rule 424(b) as part of a registration statement relating
    to an offering, other than registration statements relying on
    Rule 430B or other than prospectuses filed in reliance on
    Rule 430A, shall be deemed to be part of and included in
    the registration statement as of the date it is first used after
    effectiveness. Provided, however, that no statement made in a
    registration statement or prospectus that is part of the
    registration statement or made in a document incorporated or
    deemed incorporated by reference into the registration statement
    or prospectus that is part of the registration statement will,
    as to a purchaser with a time of contract of sale prior to such
    first use, supersede or modify any statement that was made in
    the registration statement or prospectus that was part of the
    registration statement or made in any such document immediately
    prior to such date of first use.
(4) For the purpose of determining liability of the
    registrant under the Securities Act to any purchaser in the
    initial distribution of the securities, in a primary offering of
    securities of the undersigned registrant pursuant to this
    registration statement, regardless of the underwriting method
    used to sell the securities to the purchaser, if the securities
    are offered or sold to such purchaser by means of any of the
    following communications, the undersigned registrant will be a
    seller to the purchaser and will be considered to offer or sell
    such securities to such purchaser:
(i) Any preliminary prospectus or prospectus of the
    undersigned registrant relating to the offering required to be
    filed pursuant to Rule 424;
(ii) Any free writing prospectus relating to the offering
    prepared by or on behalf of the undersigned registrant or used
    or referred to by the undersigned registrant;
(iii) The portion of any other free writing prospectus
    relating to the offering containing material information about
    the undersigned registrant or its securities provided by or on
    behalf of the undersigned registrant; and
(iv) Any other communication that is an offer in the
    offering made by the undersigned registrant to the purchaser.
II-6
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Act, the
    Registrant has duly caused this Registration Statement to be
    signed on its behalf by the undersigned, thereunto duly
    authorized, in the City of Chicago, State of Illinois, on the
    29th day of September, 2009.
ACCRETIVE HEALTH, INC.
By:
/s/  Mary
    A. Tolan
Mary A. Tolan
Founder, President and Chief Executive Officer
POWER OF
    ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
    appears below constitutes and appoints Mary A. Tolan, John T.
    Staton, Gregory N. Kazarian and David A. Westenberg, and each of
    them,
his/her
true
    and lawful attorneys-in-fact and agents, with full power of
    substitution and resubstitution for him/her and in
his/her
name, place and stead, in any and all capacities, to sign any
    and all amendments (including post-effective amendments) to this
    Registration Statement, and any subsequent registration
    statements pursuant to Rule 462 of the Securities Act and
    to file the same, with all exhibits thereto, and other documents
    in connection therewith, with the Securities and Exchange
    Commission, granting unto said attorneys-in-fact and agents, and
    each of them, full power and authority to do and perform each
    and every act and thing requisite and necessary to be done in
    and about the premises, as fully to all intents and purposes as
he/she
might
    or could do in person, hereby ratifying and confirming all that
    each of said attorney-in-fact or
his/her
substitute or substitutes, may lawfully do or cause to be done
    by virtue hereof.
Pursuant to the requirements of the Securities Act, this
    Registration Statement has been signed by the following persons
    in the capacities and on the dates indicated.
Signature
Title
Date
/s/  Mary
    A. Tolan
Mary
    A. Tolan
Director, Founder, President and Chief Executive Officer
    (Principal Executive Officer)
September 29, 2009
/s/  John
    T. Staton
John
    T. Staton
Chief Financial Officer and Treasurer (Principal Financial
    Officer)
September 29, 2009
/s/  James
    M. Bolotin
James
    M. Bolotin
Corporate Controller (Principal Accounting Officer)
September 29, 2009
/s/  J.
    Michael Cline
J.
    Michael Cline
Founder and Chairman of the Board
September 29, 2009
/s/  Edgar
    M. Bronfman, Jr.
Edgar
    M. Bronfman, Jr.
Director
September 29, 2009
/s/  Steven
    N. Kaplan
Steven
    N. Kaplan
Director
September 29, 2009
II-7
Table of Contents
Signature
Title
Date
/s/  Denis
    J. Nayden
Denis
    J. Nayden
Director
September 29, 2009
/s/  George
    P. Shultz
George
    P. Shultz
Director
September 29, 2009
/s/  Arthur
    H. Spiegel, III
Arthur
    H. Spiegel, III
Director
September 25, 2009
/s/  Mark
    A. Wolfson
Mark
    A. Wolfson
Director
September 29, 2009
II-8
Table of Contents
EXHIBIT INDEX
Exhibit
Number
Description
1
.1*
Form of Underwriting Agreement
3
.1
Fourth Amended and Restated Certificate of Incorporation of the
    Registrant, as amended
3
.2*
Form of Restated Certificate of Incorporation of the Registrant,
    to be effective upon the closing of the offering
3
.3
Bylaws of the Registrant
3
.4*
Form of Amended and Restated Bylaws of the Registrant, to be
    effective upon the closing of the offering
4
.1*
Specimen Certificate evidencing shares of common stock
5
.1*
Opinion of Wilmer Cutler Pickering Hale and Dorr LLP
10
.1
Amended and Restated Stock Option Plan
10
.2
Form of Acknowledgement of Grant, used to evidence option grants
    under the Amended and Restated Stock Option Plan
10
.3*
Restricted Stock Plan, as amended
10
.4
Form of Restricted Stock Award Agreement under the Restricted
    Stock Plan, as amended
10
.5
Third Amended and Restated Stockholders' Agreement, dated
    as of February 22, 2009, among the Registrant and the parties
    named therein, as amended
10
.6
Form of Share Exchange Agreement, entered into in February 2009,
    with each of Etienne H. Deffarges, Steven N. Kaplan, Gregory N.
    Kazarian, The Shultz 1989 Family Trust, Spiegel Family LLC and
    John T. Staton Declaration of Trust
10
.7
Lease Agreement, dated as of May 4, 2005, between the Registrant
    and Zeller Management Corporation, as amended by First Lease
    Amendment, dated as of January 30, 2007, and Second Lease
    Amendment, dated as of November 26, 2008
10
.8+
Amended and Restated Master Services Agreement, dated as of
    December 13, 2007, between the Registrant and Ascension Health
10
.9
Restricted Stock Agreement, dated as of November 7, 2004,
    between the Registrant and Ascension Health
10
.10
Protection Warrant Agreement between the Registrant and
    Ascension Health
10
.11
Supplemental Warrant Agreement between the Registrant and
    Ascension Health
10
.12
Amended and Restated Supplemental Warrant Agreement, effective
    as of May 31, 2007, between the Registrant and Ascension Health
10
.13
Second Amended and Restated Supplemental Warrant Agreement,
    effective as of September 30, 2007, between the Registrant and
    Ascension Health
10
.14
Subscription Agreement, dated as of May 15, 2007, between the
    Registrant and Ascension Health
10
.15
Term Sheet, dated February 17, 2004, between the Registrant and
    Michael Zimmerman
10
.16
Warrant and License Agreement, dated as of January 2005, among
    the Registrant, Michael Zimmerman and Zimmerman and Associates
10
.17*
Letter Agreement, dated January 9, 2009, among the Registrant,
    Financial Technology Partners, LLC and FTP Securities, LLC
10
.18
Employment Agreement, dated as of January 2004, between the
    Registrant and Mary A. Tolan, as amended
10
.19
Employment Agreement, dated as of June 17, 2005, between the
    Registrant and John T. Staton, as amended
10
.20
Offer Letter, dated December 9, 2003, between the Registrant and
    Gregory N. Kazarian, as amended
10
.21*
Form of Indemnification Agreement, to be entered into between
    the Registrant and each director and executive officer
21
.1*
Subsidiaries of the Registrant
Table of Contents
Exhibit
Number
Description
23
.1
Consent of Ernst & Young LLP
23
.2*
Consent of Wilmer Cutler Pickering Hale and Dorr LLP (included
    in Exhibit 5.1)
24
.1
Powers of Attorney (included on signature page)
*
To be filed by amendment.
+
Confidential treatment requested as to certain portions, which
    portions have been omitted and filed separately with the
    Securities and Exchange Commission.