Form of Officer/Director Indemnification Agreement

THIS INDEMNIFICATION AGREEMENT is made as of this _____ day of April, 2000, by and between _____________________ (the "Indemnitee") and AMERIGROUP CORPORATION, a Delaware corporation with a principal place of business at 4425 Corporation Lane, Suite 300, Virginia Beach, Virginia 23462 (the "Company").


RECITALS:


A. It is essential that the Company retain and attract as directors and officers the most capable persons available.


B. The Indemnitee is a director and/or officer of the Company.


C. Both the Company and the Indemnitee recognize the increased risk of litigation and other claims being asserted against directors and officers of public companies.


D. The Bylaws of the Company require the Company to indemnify directors, officers and certain other persons to the full extent permitted by law, and Indemnitee has been serving and continues to serve as a director and/or officer of the Company, in part, in reliance on such Bylaws.


E. In recognition of the Indemnitee's need for substantial protection against personal liability in order to maintain the Indemnitee's continued service to the Company in an effective manner and the Indemnitee's reliance on the aforesaid Bylaws and, in part, to provide the Indemnitee with specific contractual assurance that the protection promised by such Bylaws will be available to the Indemnitee (regardless of, among other things, any amendment to or revocation of, such Bylaws or any change in the composition of the Company's Board of Directors or any acquisition transaction relating to the Company), the Company desires to provide in this Agreement for the indemnification of and the advance of expenses to the Indemnitee to the full extent (whether partial or complete) permitted by law, as set forth in this Agreement and, to the extent officers' and directors liability insurance is maintained by the Company, to provide for the continued coverage of the Indemnitee under the Company's directors and officers liability insurance policies.


NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and in consideration of the mutual covenants and obligations herein contained, the parties hereto agree as follows:


1. Definitions. As used in this Agreement, the following terms shall have the meanings specified below:


(A) "Change in Control". Any of the following:


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(i) The acquisition by any "person" or "group" (as defined in or pursuant to Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) (other than the Company, any subsidiary thereof or any employee benefit plan of the Company or a subsidiary), directly or indirectly, as "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act) of securities of the Company representing twenty percent (20%) or more of either the then outstanding shares or the combined voting power of the then outstanding securities of the Company;


(ii) Either a majority of the directors of the Company elected at the Company's annual stockholders meeting shall have been nominated for election other than by or at the direction of the "incumbent directors" of the Company, or the "incumbent directors" shall cease to constitute a majority of the directors of the Company. The term "incumbent director" shall mean any director who was a director of the Company on the date hereof and any individual who becomes a director of the Company subsequent to the date hereof and who is elected or nominated by or at the direction of at least two-thirds (2/3) of the then incumbent directors;


(iii) The shareholders of the Company approve (x) a merger, consolidation or other business combination of the Company with any other "person" or "group" (as defined in or pursuant to Sections 13(d) and 14(d) of the Exchange Act) or affiliate thereof, other than a merger or consolidation that would result in the outstanding common stock of the Company immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into common stock of the surviving entity or a parent or affiliate thereof) more than fifty percent (50%) of the outstanding common stock of the Company or such surviving entity or a parent or affiliate thereof outstanding immediately after such merger, consolidation or other business combination, or (y) a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company's assets; or


(iv) Any other event or circumstance which is not covered by the foregoing subsections but which the Board of Directors of the Company determines to affect control of the Company and with respect to which the Board of Directors adopts a resolution that the event or circumstance constitutes a Change of Control for purposes of this Agreement.


(v) The date of a Change of Control under this Section 1(A) above is the date on which an event described in Sections 1(A)(i), 1(A)(ii), 1(A)(iii), or 1(A)(iv) above occurs.


(vi) If, following a Change of Control and a dispute with the Company regarding the terms of this Section 1(A) and any related provision of this Agreement, the Indemnitee collects any part or all of the severance pay provided under this Section 1(A) by or through the assistance of legal counsel, the Company will pay all costs of any such collection or enforcement, including reasonable attorneys' fees and other out of pocket expenses incurred by the Indemnitee, up to that point when the Company offered to settle the dispute for an amount


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(vii) The payments described in this Section 1(A) will be due the Indemnitee regardless of any subsequent employment obtained by the Indemnitee.


(B) "Claim". Any threatened, pending or completed action, suit, investigation or proceeding, and any appeal thereof, whether civil, criminal, administrative or investigative and/or any inquiry or investigation, whether conducted by the Company or any other party that the Indemnitee in good faith believes might lead to the institution of any such action.


(C) "Expenses". Include attorneys' fees and all other costs, expenses, and obligations paid or incurred in connection with investigating, defending, being a witness in or participating in (including on appeal), or preparing to defend, be a witness in or participate in any Claim relating to any Indemnifiable Event.


(D) "Indemnifiable Event". Any event, occurrence or circumstance related to the fact that the Indemnitee is or was a director or officer of the Company, or is or was serving at the request of the Company as a director, officer, employee, trustee, agent or fiduciary of another corporation, partnership, joint venture, employee benefit plan, trust or other enterprise, or by reason of anything done or not done by the Indemnitee in any such capacity.


(E) "Potential Change in Control". Shall be deemed to have occurred if (a) the Company enters into an agreement or arrangement, the consummation of which would result in the occurrence of a Change in Control; (b) any person (including the Company) publicly announces an intention to take or to contemplate taking actions which if consummated would constitute a Change in Control; (c) any person (other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company acting in such capacity or a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company), who is or becomes the beneficial owner, directly or indirectly, of securities of the Company representing ten percent (10%) or more of the combined voting power of the Company's then outstanding Voting Securities increases his beneficial ownership of such securities by five percent (5%) or more over the percentage so owned by such person on the date hereof; or (d) the Board of Directors adopts a resolution to the effect that, for purposes of this Agreement, a Potential Change in Control has occurred.


(F) "Reviewing Party". Any appropriate person or body consisting of a member or members of the Company's Board of Directors, including the Special Independent Counsel referred to in Section 2(C) (or, to the fullest extent permitted by law, any other person or body appointed by the Board of Directors), who is not a party to the particular claim for which the Indemnitee is seeking indemnification.


(G) "Voting Securities". Any securities of the Company which vote generally in the election of directors.


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2. Indemnification.


(A) Non-Exclusivity. The rights of the Indemnitee hereunder shall be in addition to any other rights the Indemnitee may have under the Company's Certificate of Incorporation or Bylaws or the Delaware General Corporation law or otherwise. To the extent that a change in the Delaware General Corporation Law (whether by statute or ...