Exhibit 10.1
EXHIBIT A
ASSET PURCHASE AGREEMENT
THIS ASSET
PURCHASE AGREEMENT (this "Agreement") has been made this 30th
day of May, 2003, by and between Medical
Billing Management, Inc. (hereafter
"Seller"), a Mississippi corporation in
good standing, by and through Margaret
Brown, its President, and Mastel Precision
Health Information Services, Inc.
(hereafter "Buyer"), a Nevada corporation
in good standing, by and through its
Chief Executive Officer, Arthur D.
Lyons.
Whereas, the
purpose of this Agreement is to set forth the conditions
under which the Seller agrees to sell and
the Buyer agrees to purchase the
Seller's tangible assets, personal and
mixed, and regardless of where located,
including those at the business address of
1867 Crane Ridge Drive, Suite 250-
A, Jackson, Mississippi 39216, for the
price and upon the terms set forth in
this agreement.
NOW, THEREFORE,
in consideration of the premises and the mutual promises
of the parties, and in consideration of the
representations, warranties,
covenants and agreements contained herein,
it is hereby agreed as follows:
ASSETS BEING SOLD AND PURCHASED:
Subject to the
provisions of this Agreement, Buyer hereby agrees to
purchase, and Seller hereby agrees to sell,
transfer and assign to Buyer, all
of Seller's right, title and interest in
and to the tangible assets of
Seller's business described hereinbelow
(the "Purchased Assets"), including,
without limitation, those tangible assets
related to and used in the operation
of the business, and all existing contracts
and proposals with all of Seller's
clients (e.g. hospitals, clinics, etc.),
and as shown on Seller's March 31st,
2003 balance sheet, subject to changes
occurring in the normal and ordinary
course of business that date and the date
of closing, and excepting the
Seller's cash and certain accounts
receivable further specifically described
hereinbelow, and excepting any and all
accrued, contingent and existing
Company debts and liabilities associated
with the Purchased Assets or Seller's
business prior to closing on this
agreement, with the exception of Workers'
Compensation, General Liability and Errors
and Omissions which are covered
under insurance.
The personal
property, tangible and intangible, specifically listed on
Exhibit "A" and
further generally described as follows:
a) All
furniture, equipment, machinery, all computers and
computer software, office supplies, phone systems, existing
contracts and proposals with all clients of the Seller, and
all other personal property being at and used in connection
with carrying on the medical billing business;
b) Signage
wherever now located;
c) Within ten
(10) working days following closing of this
transaction Seller will change its name from Medical Billing
Management, Inc. to an unrelated name. Buyer, at its
discretion, may then form a corporation with the Secretary
of State's office with the State of Mississippi to obtain
such name.
d) The transfer
of any existing municipal, state or federal
licenses of the business, and if any of the same requires
the approval of an issuing authority, then this agreement is
subject to the approval of the issuing authorities;
e) The use of
Seller's accounts receivables on a "short-term"
basis as set out hereinbelow;
f) The sharing
of Seller's accounts receivables that are
collected by Buyer after closing as set out hereinbelow; and
g) Any other
contracts between the Seller and vendors or
service
providers that are in existence and which Buyer
desires to obtain for the benefit of the ongoing medical
billing business, including customer list of prior and
current customers.
PURCHASE PRICE:
Consideration for
Purchased Assets. In
consideration for the Purchased
Assets and Seller's covenants herein, Buyer
agrees to pay Seller Four Hundred
Fifty Thousand Dollars ($450,000.00)
subject to the following conditions and
schedule:
1) Cash at closing:
$ 150,000.00
2) Cash six
months after closing: $
75,000.00
3) A final
payment of the balance owed
on May 31st, 2004, subject to the
earn-out provision as is defined
hereinbelow, and estimated herein $ 225,000.00
$ 450,000.00
Earn-out
Provision. The parties
agree that the "earn-out" provision
shall be calculated based upon the future
net revenue of those client accounts
existing at the time of closing.
The baseline revenue
amount is $1,109.000
(2002 revenue less anticipated adjustments
to 2003 revenue). The
"payout
ratio" is a $1.00 adjustment upward or
downward in the final $225,000.00
payment for every $4.00 in revenue change,
either plus or minus, respectively.
This earn-out provision will be a one-time
calculation as of the period
beginning on the date after closing and
ending on May 31, 2004.
All
consideration identified herein is hereafter referred to as the
"Purchase Price".
ACCOUNTS RECEIVABLES AND WORK IN
PROCESS:
The parties
further agree that Seller has acquired certain accounts
receivable and work in process.
Accounts Receivable
are defined as those
accounts where Seller has billed patients
on behalf of its clients, the
patients have been paid such bills, and the
clients now owe a payment to
Seller but such payment to Seller has not
yet been made. Work in
Process is
defined as those accounts where Seller has
billed patients on behalf of its
clients but no payment has been received
plus those accounts where it is
appropriate for Seller to send out bills on
behalf of its clients, but no bill
has yet been sent. The parties agree to the following
distribution of the
same, to-wit:
Obligation for
Collection of Accounts Receivable and Work in Process.
The parties agree that the Buyer shall be
responsible for the collection of
all accounts receivable and work in process
of Seller, from and after the date
of closing. As set out hereinafter, Seller
assigns half of the Work in
Process to the Buyer and retains half of
the Work in Process and all of the
Accounts Receivable.
Loan to Buyer.
Seller agrees that
Buyer shall retain Seventy-Five
Thousand Dollars ($75,000.00) of Seller's
first accounts receivable collected
by Buyer after the closing which shall be
used by Buyer as working capital.
Buyer shall have the use of said borrowed
funds until November 30, 2004,
interest free, when the borrowed funds will
be due to be reimbursed to the
Seller.
Buyer's purchase
of Seller's Accounts Receivable and Work in Process.
After 90 days have expired from the date of
closing, Buyer will make a lump-
sum payment to Seller in an amount equal to
the collections on accounts
receivable (accounts receivable being those
identified on Exhibit "B" attached
hereto. However, of the amount of this
payment, Buyer shall have the right to
retain $75,000.00 to fund the loan referred
to in the preceding paragraph.
This payment shall be in addition to the
amounts to be paid under
"Consideration for Purchased Assets."
In the event that
Accounts Receivable
(as they exist on the closing date) are
collected more than 90 days after
closing, then such sums shall be paid to
Seller on May 31, 2004, or when the
$75,000.00 loan in the preceding paragraph
is paid, whichever is earlier. All
collections on Accounts Receivable shall be
applied first to the oldest
account owed by the customer making such
payment.
After 90 days
have expired from the date of closing, Buyer will make a
lump-sum payment to Seller in an amount
equal to one-half of the work in
process as identified on Exhibit "B"
attached hereto. This
payment shall be
in addition to the amounts to be paid under
"Consideration for Purchased
Assets."
EXCLUDED LIABILITIES:
Except as
expressly set forth herein, Buyer does not assume and shall
not be liable for any of the debts,
obligations or liabilities of Seller or
Seller's business of any nature whatsoever.
In particular, but
without
limiting the foregoing, Buyer shall not
assume, and shall not be deemed by
anything contained in this Agreement or any
other related Agreement, to have
assumed, and shall not be liable for any
debts, obligations or liabilities of
Seller or Seller's business, whether know
or unknown, contingent, absolute or
otherwise, including without limitation
debts, liabilities and obligations:
1) Under any contract or
agreement to which Seller is bound excepting
the real estate lease being assigned to Buyer herein, the
contract
for the copier used by Seller, the postage machine used by
Seller,
and the contract with Time Warner Cable.
2) Buyer agrees to assume all
responsibility for any accrued vacation
pay,
severance pay or accrued sick pay. Buyer further agrees to
employ all employees of Seller as of the date of closing under
the
same terms and conditions as such employees were employed by
Seller.
3) For any other payment or
compensation to employees of Seller
including any severance pay liabilities under federal or state
law
or under any welfare, compensation, pension or benefit plan or
agreement, or under the Consolidation Omnibus Budget
Reconciliation Act of 1985 ("COBRA") or under the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"),
for
the period ending on the closing date. Buyer however agrees to
provide health insurance benefits and a cafeteria plan under
such
terms as are comparable to the terms of the plans offered by
Seller prior to the closing.
4) For any foreign, federal,
state or local income, franchise,
excise, value added, sales, use, payroll, worker's
compensation,
property or other tax or taxes of any type, nature or
description,
which such tax liability is base don Seller's actions or
operations prior to the closing date or as a result of this
transaction, and for any liability for local or state taxes,
use
or transfer tax, which such tax liability is based on Seller's
actions or operations prior to the closing date or as a result
of
this transaction or taxes that may be imposed upon the purchase
and sale of the assets pursuant to the Agreement,
5) For any damages or injuries
to persons or property or for any tort
or strict liability arising from events, actions, or inaction
or
the operation of Seller's business on or prior to the closing
date, except that Buyer will continue to maintain liability
insurance in amounts at least equal to that Seller was carrying
prior to the closing and such liability insurance will cover
Seller,
6) For any liability arising at
any time from or relating to injuries
arising from events occurring on or prior to the closing date,
even if a claim for any such injury is first asserted after the
closing date, except that Buyer will continue to maintain
liability insurance in amounts at least equal to that Seller
was
carrying prior to the closing and such liability insurance will
cover Seller,
7) For any liability or
obligation (contingent or otherwise) of
Seller arising out of any litigation arising in any way on
account
of the period prior to the closing date, whether or not now
threatened or pending, except that Buyer will continue to
maintain
liability insurance in amounts at least equal to that Seller
was
carrying prior to the closing and such liability insurance will
cover Seller,
8) Incurred by Seller or
Seller's business for borrowed money,
9) Arising from any contract
assigned to an assumed by Buyer
hereunder provided, however, that such exclusion shall be
limited
to liabilities and obligations for all periods prior to and
including the closing date, whether arising before or after the
closing date, and
10) For any other liability or
obligation of Seller that is not
expressly assumed by Buyer whether or not such liability or
obligation has been disclosed to or is known to Buyer.
Seller further
warrants to Buyer that any known accrued liabilities of
the Seller will be paid at or within 15
days after closing or as such
liabilities come due, whichever is later.
On or before the date
of closing,
Seller will execute and provide to Buyer a
statement of all known liabilities
of Seller's business. Seller agrees that it will pay the
payroll due on June
13, 2003 for the two week period ending
June 6, 2003. Of this
amount, one
half will be considered an advance on the
$75,000 loan referred to in Loan to
Buyer above.
ALLOCATION OF PURCHASE PRICE:
The purchase
price shall be allocated as follows:
1) Equipment, Furniture and
other depreciable assets:
$124,564.00
2) Accounts Receivable and Work
in Process:
$135,000.00
3) Covenant Not to Compete:
$100,000.00
4) Goodwill:
Balance of Purchase Price
Treasury Regulation
1.1060-1T Reporting Requirement. The parties hereby
agree that they shall each use the
allocation made by them pursuant to Section
2.3 as an agreed allocation of the
consideration paid for the Purchased Assets
in accordance with the provisions of
Treasury Regulation Section 1-1060-1T,
etseq. The parties each covenant and
agree to use such allocation to complete
and file Internal Revenue Service Form
8594, Asset Acquisition Statement Under
Section 1060, if applicable.
CLOSING DATE:
Closing.
The closing date for
the transactions contemplated by this
Agreement shall be May 30th, 2003 (the
"Closing").
Obligations of
Seller at Closing. At
the Closing, Seller shall:
1) Execute and deliver to Buyer
a Bill of Sale and other documents
necessary for transfer of title to all assets being purchased.
2) Execute and deliver to Buyer
such other documents as may be
necessary to vest Seller's right, title and interest in and to
any
location leased by Seller at the time of closing where it has
done
business, all at Buyer's option.
Obligations of
Buyer at Closing. At
the Closing, Buyer shall deliver
all funds to be tendered at closing by a
cashier's check to the Seller or the
closing agent agreed to by the parties.
Buyer shall also
execute the Security
Agreement and UCC-1 Financing Statement in
the form attached hereto.
Post-Closing
Acts, Deeds and Undertakings. Following the Closing, the
parties shall fully and faithfully
undertake all such further acts, deeds and
undertakings as may be necessary or
required to consummate the transactions
contemplated by this Agreement in
accordance with the terms herein.
CONDITIONS PRECEDENT:
Contingencies.
In the event
that any of the following events occur, the parties agree
that this agreement shall be null and void,
ab-initio, to-wit:
1) In the event that the Seller
does not obtain and provide to Seller
the written consent to assignment of any lease of Seller's
existing business locations that Buyer desires to maintain, or,
in
the event that the remaining lease term is of such limited
duration that Buyer wishes to enter into a new lease agreement
with the Lessor of said location, and the Buyer is unable to
obtain said new lease agreement at such terms and conditions
that
are substantially as the Seller's lease, or for such an
extended
period of time as is required by Buyer;
2) In the event that Buyer and
Seller do not consummate an employment
agreement between Buyer, as employer, and Margaret Brown, as
employee;
REPRESENTATIONS AND WARRANTIES:
Representations
and Warranties of Seller: Seller represents and warrants
to, and covenants with, Buyer that the
following statements are true, correct
and complete as of the date of this
Agreement, and that the same shall be
true, correct and complete on the
Closing.
1) Seller is a duly organized
and validly existing corporation formed
under the laws of the State of Mississippi and is in good
standing
in such jurisdiction.
2) Seller has the right, power,
and authority to enter into this
Agreement.
3) The execution of this
Agreement by Seller and the transactions
contemplated by this Agreement have been duly authorized by all
necessary action required for such authorization by the Seller
corporation.
4) Seller is not, nor at any
time will be, a party to any contract or
other arrangement of any nature that will materially interfere
with its full, due, and complete performance of this Agreement,
and neither Seller nor Brown will solicit or entertain any
offer
from any other person and will not enter into any negotiations
for
the sale of the business or assets of Seller's business with
any
third party.
5) Seller is not, nor at any
time will it be, in knowing violation of
any existing law,
statute or regulation, by entering into and
undertaking the performance of this Agreement.
6) To the best knowledge and
belief of Seller, there is no litigation
or proceeding pending, nor is any litigation pending, involving
Seller which could, if adversely determined, materially and
adversely affect the performance of its obligations under this
Agreement.
Representations
and Warranties of Buyer. Buyer represents and warrants
to, and covenants with, Seller that the
following statements are true, correct
and complete as of the date of this
Agreement, and that the same shall be
true, correct and complete on the
Closing:
1) Buyer has the right, power,
and authority to enter into this
Agreement.
2) The execution of this
Agreement by Buyer and the transactions
contemplated by this Agreement have been duly authorized by all
necessary action required for such authorization by the Buyer
corporation.
3) Buyer is not, nor at any
time will be, a party to any contract or
other arrangement of any nature that will materially interfere
with its full, due, and complete performance of this Agreement.
4) Buyer is not, nor at any
time will it be, in knowing violation of
any existing law,
statute or regulation, by entering into and
undertaking the performance of this Agreement.
5) To Buyer's best knowledge
and belief, there is no litigation or
proceeding pending, nor is any litigation threatened or
pending,
involving Buyer which could, if adversely determined,
materially
and adversely affect the performance of Buyer's obligations
under
this Agreement.
6) As of the time of closing
Buyer will be authorized to do business
within the State of Mississippi.
7) Buyer agrees at the time of
closing that it will convey to Seller
a Security Agreement and UCC-1 Financing Statement in the forms
attached hereto as Exhibits "D" and "E". Buyer further represents
that such documents will grant unto Seller a priority position
as
first lienholder in all assets and accounts receivable being
acquired by Buyer from Seller. This Security Agreement and
UCC-1
Financing Statement will be cancelled by Seller immediately
upon
receipt of the final payment due from Buyer under this Asset
Purchase Agreement.
8) Buyer will execute the
employment agreement with Margaret Brown at
the time of
closing.
REPRESENTATIONS AND WARRANTIES CONCERNING
PURCHASED ASSETS:
Except as
otherwise expressly provided herein, Seller makes no
representations or warranties, either
expressed or implied, concerning the
Purchased Assets.
INDEMNIFICATION:
1) Seller shall indemnify,
defend and hold Buyer harmless, from and
against, and reimburse Buyer with respect to any and all
losses,
damages, liabilities, claims, judgments, costs and expenses
(including attorneys' fees and costs) of any nature whatsoever
that Buyer shall suffer as a result of a breach of any
representation, warranty, covenant or agreement contained
herein.
2) Buyer shall indemnify,
defend and hold Seller harmless from and
against, and reimburse Seller with respect to any and all
losses,
damages, liabilities, claims, judgments, costs and expenses
(including attorneys' fees and costs) of any nature whatsoever
that Seller shall suffer as a result of a breach of any
representation, warranty, covenant or agreement contained
herein.
AGREEMENT TO EMPLOY CERTAIN EMPLOYEES:
The Buyer
agrees, as consideration for Seller's agreements made herein,
to enter into a 12 month employment
agreement with Margaret R. Brown
("Brown"), renewable annually, as long as
terms and conditions are met that
are agreeable to both parties. During this period of employment,
Brown will
assist Buyer in the transition of the
business along with certain management
and sales responsibilities. In consideration for these
services, Brown will
be compensated with an annual base salary
of $50,000.00, plus a commission
based on sales, all as is more specifically
defined in the separate Employment
Agreement to be entered into by Brown and
Buyer.
As further
consideration from Buyer and Seller's agreements herein,
Buyer agrees to offer to retain Mr. Tom
Lott in his current position and
salary during the twelve month transition
period immediately following the
closing.
DISPUTES:
Resolution of
Disputes.
1) Arbitration. All disputes between or among
parties relating to
this Agreement (a "Dispute"), which have not been otherwise
resolved (such unresolved Dispute hereafter referred to as an
"Arbitrable Matter"), shall be exclusively and finally resolved
by
arbitration by a single arbitrator agreed upon by the parties
to
the Arbitrable Matter (the "Arbitrator"). If the parties are
unable to agree upon a single arbitrator, each of the parties
to
the Arbitrable Matter shall select an arbitrator, with a third
(3rd) arbitrator selected by the arbitrators chosen by the
parties. In this
event, the third (3rd) arbitrator shall decide
the Arbitrable Matter by a his/her sole discretion. All
arbitration proceedings shall occur in Jackson, Mississippi.
2) Direct Negotiation and
Mediation Prior to Undertaking Mandatory
Arbitration.
Notwithstanding the provisions of the above section,
prior to arbitrating any Dispute, the parties agree that they
initially shall attempt to resolve the Dispute through direct
negotiation. If the Dispute is not resolved within fourteen
(14)
days after written demand for direct negotiation, the parties
shall attempt to resolve the Dispute through mediation, with a
mediator jointly chosen by the parties, and the cost borne
equally
by the parties. If the
mediator is unable to facilitate a
settlement of the Dispute within a reasonable period of time,
as
determined by the mediator, the mediator shall issue a written
statement to the parties to that effect and any unresolved
Dispute
shall be resolved through binding arbitration in accordance
with
the provisions of this Section.
3) Rules Governing Arbitration.
Any arbitration (an
"Arbitration")
shall be governed by the Commercial Arbitration Rules of the
American Arbitration Association ("AAA") then pertaining.
The
existence and resolution of the Arbitration proceedings shall
be
kept confidential by the parties and by the Arbitrator except
as
required by law, regulation or a court of competent
jurisdiction.
4) Notice of Arbitration.
Any party to this
Agreement may initiate
an Arbitration of any Arbitrable Matter. The initiating party
shall do so by providing written notice of the Arbitration to
the
other party or parties to the Arbitrable Matter. The notice shall
bear a current date, shall state the name of the initiating
party
and shall briefly state the matter to be arbitrated.
5) No Appeal, Etc. Except as otherwise permitted by
the Commercial
Arbitration Rules of the AAA of Mississippi statutes, no party
shall appeal to any
court an order of an Arbitrator, and the
decision of the Arbitrator, and the order entered, shall be the
final, binding and conclusive resolution fo the Arbitrable
Matter.
Any party to the Arbitrable Matter may enter such order in any
court of competent jurisdiction.
6) Allocations of Costs, Fees,
Etc. The Arbitrator
may allocate
among the parties to the dispute the costs, fees and other
expenses relating to an Arbitration in any manner that the
Arbitrator shall determine to be appropriate in his/her
absolute
discretion; provided, that if the Arbitrator determines that a
party has initiated an Arbitration without reasonable basis for
doing so,
the Arbitrator shall assess against that party the costs
of the other parties relating to the Arbitration, including the
reasonable attorneys' fees of the parties.
MISCELLANEOUS:
1) Agreement Binding.
This Agreement shall
be binding upon and inure
to the benefit of the parties named herein and their respective
successors and assigns.
2) Title and Captions.
All section titles or
captions contained in
this Agreement are for convenience only and shall not be deemed
part of this context nor effect the interpretation of this
Agreement.
3) Incorporation of Exhibits.
The exhibits
identified in this
Agreement are incorporated herein by reference and made a part
of
this Agreement.
4) Advice Concerning Legal, Tax
and Accounting Consequences of
Transaction. Each of
the parties to this Agreement represents and
warrants that prior to entering into this Agreement, that they
have had the opportunity to seek the advice of professional
advisors concerning the legal, tax and accounting consequences
of
the transactions contemplated by this Agreement, that both have
had this agreement reviewed by legal counsel licensed to
practice
law in the state of Mississippi, and Buyer further represents
that
this agreement has been drafted by legal counsel licensed to
practice in the state of South Dakota, and the parties executed
this Agreement with full knowledge and understanding of all
legal,
tax and accounting consequences. Regardless of whether or not
the
transaction contemplated herein is consummated, each of the
parties are responsible for the payment of any and all expenses
that they incur as a result hereof, and that Seller shall be
solely responsible for any broker fees in connection with this
transaction.
5) Final, Complete and
Exclusive Agreement.
This Agreement contains
the final, complete and exclusive agreement between the parties
and supersedes any prior understandings and agreements among
them
respecting the subject matter of this Agreement.
6) Governing Law/Jurisdiction.
This Agreement has
been executed by
Buyer in Mississippi and shall be governed by and shall be
construed in accordance with the State of Mississippi,
excepting
that Mississippi shall apply the laws of Mississippi for issues
regarding the personal property being purchased herein.
The
parties consent to the jurisdiction of the courts of the State
of
Mississippi and agree that any action arising out of or to
enforce
this Agreement must be brought and maintained in Mississippi.
7) Notices. All notices required or permitted
hereunder shall be in
writing and shall be deemed effectively given:
a) upon personal
delivery to the party to be notified;
b) when sent by
confirmed telex or facsimile if sent during
normal business hours of the recipient, if not, then on the
next business day;
c) five (5) days
after having been sent by registered or
certified mail, return receipt, postage prepaid; or
d) two (2) days
after deposit with a nationally recognized
overnight courier, specifying next day delivery, with
written verification of receipt.
All communications shall be sent to the parties hereto at the
respective addresses set forth below, or as notified by such
party
from time to time at least ten (10) days prior to the
effectiveness of such notice:
If to Seller:
Margaret R. Brown
1867 Crane Ridge Drive, Suite 250-A
Jackson, Mississippi 39216
With a copy to:
James T. Knight
Knight Law Offices, PLLC
301 Highland Park Cove, Suite A
Ridgeland, MS 39157
If to Buyer:
Arthur D. Lyons, CEO
2843 Samco Road,
Suite A
Rapid City, SD 57702-9366
8) Waiver. No waiver by any party of any
default, misrepresentation,
or breach of warranty hereunder, whether intentional or not,
shall
be deemed to extend to any prior ro subsequent default,
misrepresentation, or breach of warranty hereunder or affect in
any way rights arising by virtue of any prior or subsequent
such
occurrence.
9) Severability. Any term or provision of this
Agreement that is
invalid or unenforceable shall not affect the validity or
enforceability of the remaining terms and provisions of this
Agreement.
10) Terms. Common nouns and pronouns shall be
deemed to refer to the
masculine, feminine, neuter, singular and plural, as the
identity
of the party may in the context require.
11) Rules of Construction.
The parties hereto
agree that they have
been represented by counsel during the negotiation and
execution
of this Agreement and, therefore, waive the application of any
law, regulation, holding or rule of construction providing that
ambiguities in an agreement or other document will be construed
against
the party drafting such agreement or document.
12) Amendments and Waivers.
No amendment of any
provision of this
Agreement shall be valid unless the same shall be in writing
and
signed by the parties.
13) Counterparts. This Agreement may be executed
simultaneously in
two or more counterparts each of which shall be deemed an
original, and all of which, when taken together, constitute one
and the same document.
The signature of any party to any
counterpart shall be deemed a signature to, and may be appended
to, any other counterpart.
IN WITNESS
WHEREOF, the undersigned have executed this Agreement on the
date first written above.
SELLER:
Medical Billing Management, Inc.
By:/s/Margaret R. Brown
Margaret R. Brown
<PAGE>
PURCHASER:
Mastel Precision Health Information
Services
By:/S/Arthur D. Lyons
Arthur D. Lyons
State of Mississippi
County of Hinds
On this the 30th
day of May, 2003, before me, the undersigned officer,
personally appeared Margaret R. Brown, who
acknowledged herself to be the
President of Medical Billing Management,
Inc., a Mississippi corporation, and
that she, as such President, being
authorized so to do, executed the foregoing
instrument for the purposes therein
contained, by signing the name of the
corporation by herself as such
President.
In witness
whereof, I hereunto set my hand and official seal.
/s/_______________________
Notary Public
My Commission Expires:
April 28, 2006
<PAGE>
State of Mississippi
County of Madison
On this the 23
day of May, 2003, before me, the undersigned officer,
personally appeared Arthur D. Lyons who
acknowledged himself to be the Chief
Executive Officer of Mastel Precision
Health Information Services, Inc., a
corporation, and that he, as such officer,
being authorized so to do, executed
the foregoing instrument for the purposes
therein contained, by signing the
name of the corporation by himself as such
officer.
In witness
whereof I hereunto set my hand and official seal.
/s/Deandria Jennings Davis
Notary Public
My Commission Expires:
November 8, 2005
<PAGE>
EXHIBIT A
All accounts receivable and all property
located at 1867 Crane Ridge Drive,
Suite 250-A, Jackson, Mississippi
39216.
<PAGE>
EXHIBIT B
MEDICAL BILLING MANAGEMENT, INC.
ACCOUNTS RECEIVABLE IN PROCESS (WORK IN
PROCESS)
May 30, 2003
ANESTHESIA CONSULTANTS
1,352,275.01
TODD BESSELIEVRE
264,201.47
JOHN S. BURWELL
271,197.17
CURTIS CAINE
13,352.46
WINSTON CAPEL
343,880.85
GREENWOOD ANESTHESIA
2,315.35 INACTIVE ACCOUNT
GREENWOOD PAIN MGT
2,020.81 INACTIVE ACCOUNT
LAUREL ANES GROUP
795,085.46
SURGICAL ANESTHESIA ASSOCIATES
1,505,540.98
ROBERT R. SMITH, PLLC
355,427.36
CHELE VEACH
23,487.88
MICHAEL VISE
103,810.03
FACES
28,985.76
SOUTH CENTRAL ANESTHESIA
100,095.00
FAWAZ ABDRABBO
NEW CLIENT WILL
BEGIN NE
CYNTHIA VAUGHN
1,492.20
TOTAL
5,163,167.79
<PAGE>
EXHIBIT C
EMPLOYMENT AGREEMENT
This agreement
is made this 30th day of May, 2003, and is made by and
between Margaret Brown ("employee") and
Mastel Precision Health Information
Services, Inc., a South Dakota corporation
DBA Medical Billing Management
("company").
Recitals.
The parties to
this agreement acknowledge that said employee's talents
and services to the company are of a
special, unique and extraordinary
character and are of particular and
peculiar benefit and importance to the
company, and that the purpose of this
agreement is for the company to employ
Margaret Brown, and as consideration for
such employment, for Margaret Brown
to provide the company with assurances that
she will carry out this agreement.
Therefore, the
parties agree as follows:
1. Employment. The company agrees to employ
employee in the capacity of
general manager as is stated with more
specificity hereinbelow, and employee
agrees to be so employed by the company,
for a period commencing June 1, 2003,
and continuing for a 12-month period ending
on May 31, 2004, subject, however,
to prior termination as provided in this
agreement.
2. Best Efforts of
Employee.
(A) Employee agrees that she will at
all time faithfully,
industriously and
to the best of her ability, experience and
talents, perform all of the duties
that may be required of an from her
pursuant to the express and implicit terms
of this agreement, to the reasonable
satisfaction of the company. The duties
shall be rendered at the Corporation's
business location commonly known as
1867 Crane Ridge Drive, Suite 250-A,
Jackson, Mississippi 39216, or as such
other place or places in said city and at
such times as the needs of the
Corporation may from time-to-time
dictate.
(B) Employee shall devote her normal
and regular business time, attention,
knowledge and skill to the business and
interests of the company, and the
company shall be entitled to all of the
benefits, profits or other issue
arising from or incident to all work,
services and advice of employee
performed for the company. It is acknowledged by company that
the employee
has other for-profit interests, and
employee agrees that she shall not allow
her other interests to materially interfere
with her duties to employer.
3. Compensation.
As compensation for the services to be
rendered by employee, the company
agrees to provide employee with the
following:
A. Base Compensation.
The Employee will
receive a base salary of
$50,000.00 per year, payable in accordance
with the Corporation's standard
payroll procedures.
B. Bonuses. The Employee is eligible for
performance-based bonuses
on the medical billing business, which are
to be paid upon attainment of the
following performance indices:
7.5% of gross
revenue on new billing accounts acquired by Employee from
and after
June
