U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the period ended September 30, 2001
Commission file number 000-29579
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U.S. Medical Group, Inc.
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(Exact Name of Small Business Issuer as Specified in its Charter)
Nevada 88-0320389
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(State of jurisdiction of incorporation) (IRS Employer Identification No.)
1405 South Orange Avenue Suite 600, Orlando, FL 32806
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(Address of principal executive offices)
Registrant's telephone number (407) 849-2288
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Check whether the registrant (1) has filed all reports required to be
filed by Sections 13 or 15(d) of the Securities Exchange Act during the past 12
months (or for such shorter period as the Registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days.
Yes [X] No [ ]
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
13,575,380 shares of common stock outstanding as of September 30, 2001.
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U.S. Medical Group, Inc
Quarterly Report on Form 10-QSB for the
Quarterly Period Ending September 30, 2001
Table of Contents
Part I: FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets:
September 30, 2001 and December 31, 2000
Consolidated Statement of Operations:
Three Months and Nine Months Ended
September 30, 2001 and 2000
Consolidated Statement of Cash Flows:
Nine Months Ended September 30, 2001 and 2000
Notes to Consolidated Financial Statements:
September 30, 2001
Item 2. Management's Discussion and Analysis
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
1
U.S. MEDICAL GROUP, INC.
CONSOLIDATED BALANCE SHEET
September 30, December 31,
2001 2000
----------- -----------
(Unaudited)
ASSETS
Current assets:
Cash and equivalents $ 749,708 $ 337,050
Accounts receivable 308,711 361,833
Prepaid expenses 65,012 44,409
----------- -----------
Total current assets 1,123,431 743,292
Property and equipment - at cost:
Mobile unit and medical equipment 3,727,738 3,827,196
Furniture and fixtures 76,476 77,383
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3,804,214 3,904,579
Less accumulated depreciation 939,350 728,496
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2,864,864 3,176,083
Other assets:
Patents & Trademarks, net of amortization 27,917 39,168
Financing fees, less amortization of $14,404
and $10,597 on September 30, 2001 and
December 31, 2000, respectively 3,353 7,160
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$4,019,565 $3,965,703
=========== ===========
See accompanying footnotes to the unaudited financial statements
2
U.S. MEDICAL GROUP, INC.
CONSOLIDATED BALANCE SHEET
September 30, December 31,
2001 2000
------------ ------------
(Unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses $ 103,669 $ 87,145
Current maturities of long-term debt 744,661 641,828
Income tax payable 90,890 156,036
Deferred tax liability 182,086 106,344
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1,121,306 991,353
Long-term debt less current maturities 689,421 1,196,905
Deferred tax liability 330,096 330,096
Stockholders' equity:
Preferred stock, par value, $.001 per share,
20,000,000 authorized at September 30, 2001
and December 31, 2000; none issued - -
Common stock, par value, $.001 per share;
100,000,000 authorized, 13,575,380 issued
at September 30, 2001 and December 31, 2000 13,575 13,575
Additional paid-in-capital 80,925 80,925
Retained earnings 1,871,474 1,371,419
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Treasury Stock (87,232) (18,570)
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Total Stockholder Equity 1,878,742 1,447,349
------------------------ ------------ ------------
$ 4,019,565 $ 3,965,703
============ ============
See accompanying footnotes to the unaudited financial statements
3
U.S. MEDICAL GROUP, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
UNAUDITED
Three months ended Nine months ended
September 30, September 30,
2001 2000 2001 2000
------------ ------------ ------------ ------------
Revenues:
Patient fees $ 875,778 $ 905,835 $ 2,619,481 $ 2,618,212
Operating expenses:
Selling, general and administrative 500,138 457,251 1,608,494 1,248,720
Interest expense 18,251 42,905 90,642 130,344
Depreciation expense 82,662 82,868 255,575 239,321
------------ ------------ ------------ ------------
Operating expense 601,051 583,024 1,954,711 1,618,385
Net income before taxes and
extraordinary gain 274,727 322,811 664,770 999,827
Provision for income taxes 57,353 117,309 231,202 398,209
------------ ------------ ------------ ------------
Net Income before Extraordinary Gain $ 217,374 $ 205,502 433,568 $ 601,618
Extraordinary Gain from Sale of Equipment
(net of income taxes of $16,621) 66,487 - 66,487 -
------------ ------------ ------------ ------------
Net Income $ 283,861 $ 205,502 $ 500,055 $ 601,618
============ ============ ============ ============
Earnings per common share
(basic and assuming dilution) $ .02 $ .02 $ .04 $ .04
============ ============ ============ ============
Weighted average shares outstanding
Basic 13,575,000 13,575,000 13,575,000 13,575,000
Diluted 13,655,000 13,655,000 13,655,000 13,655,000
See accompanying footnotes to the unaudited financial statements
4
U.S. MEDICAL GROUP, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
UNAUDITED
For the nine months ended
September 30,
2001 2000
------------ ------------
Cash flows from operating activities:
Net income from operating activities $ 500,055 $ 601,618
Adjustments to reconcile net income to net cash:
Depreciation and amortization 270,633 237,237
Change in: Receivables 53,122 (12,125)
Prepaid expenses and other assets (20,603) (37,967)
Deferred income taxes and other 75,742 37,981
Income tax payable (65,146) 204,228
Accounts payable and accrued expenses 16,524 (10,804)
Net Gain from sale of fixed assets (83,865)
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Net cash from operating activities 746,462 1,020,168
Cash flows used in investing activities:
Capital expenditures (87,041) (198,852)
Sale of Equipment 226,550 -
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Net cash used in investing activities 139,509 (198,852)
Cash flows (used in)/provided by financing activities:
Proceeds from bank loans - -
Proceeds from loans from stockholders - 237,608
Repayments of bank loans (404,651) (512,636)
Repayment of loans from stockholders - -
Purchase of Treasury Stock (68,662) -
Dividend Payments - (441,738)
------------ ------------
Net cash used in financing activities (473,313) (716,766)
Net increase in cash and cash equivalents 412,658 104,550
Cash and cash equivalents at January 1 337,050 22,763
Cash and cash equivalents at September 30 $ 749,708 $ 127,313
=========== ===========
Supplemental Information:
Interest Paid $ 72,190 $ 109,558
Income Tax Paid 25,217 78,000
See accompanying footnotes to the unaudited financial statements
5
U.S. MEDICAL GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2001
(UNAUDITED)
NOTE A - SUMMARY OF ACCOUNTING POLICIES
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General
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The accompanying unaudited consolidated financial statements have been prepared
in accordance with the instructions to Form 10-QSB, and therefore, do not
include all the information necessary for a fair presentation of financial
position, results of operations and cash flows in conformity with generally
accepted accounting principles.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the nine-month period ended September 30, 2001 are not
necessarily indicative of the results that may be expected for the year ended
December 31, 2001. The unaudited condensed consolidated financial statements
should be read in conjunction with the consolidated December 31, 2000 financial
statements and footnotes thereto included in the Company's Annual Report on Form
10-KSB, as amended.
Basis of Presentation
---------------------
The consolidated financial statements include the accounts of the Company, and
its wholly-owned subsidiary, U.S. Medical Group (Florida), Inc., formerly
American Mobile Surgical Services, Inc. Significant intercompany transactions
have been eliminated in consolidation.
Certain prior period amounts have been reclassified for comparative purposes.
6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS of FINANCIAL CONDITION AND RESULTS
OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
The following discussion should be read in conjunction with the Company's
Consolidated Financial Statements and Notes thereto, included elsewhere within
this Report.
Three Months Ended September 30, 2001 and 2000
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REVENUES
The Company's total revenues were $875,778 for the three-month period ended
September 30, 2001, compared to $905,835 for the same period ended September 30,
2000, a decrease of $30,057, or 3.3%. The decrease in revenue is primarily a
result of a decreased caseload in Florida when compared to the year-ago period.
The Company reported net income from continuing operations for the three month
period ended September 30, 2001 of $283,861, compared to $205,502 for the
three-month period ended September 30, 2000, an increase in earnings of $78,359,
or 38%. The earnings increase is primarily attributable to the sale of
equipment, which produced a non-recurring extraordinary gain of $66,487. Net
income for the period three months ended September 30, 2001 excluding the
extraordinary gain was $217,374, an increase of $11,872, or 5.8% when compared
to the year-ago period. Revenue and net income for the three-month period ended
September 30, 2001 is primarily attributed to the Florida and North Carolina
State Department of Corrections contracts.
The Company has contracts with the Florida and North Carolina State Department
of Corrections. Florida has awarded the Company a three-year contract, with two
additional one-year options effective August 1, 2001. The North Carolina State
Department of Corrections has exercised the third-year option in the series of
four one-year options. The North Carolina one-year option contract renewal
expires June 30, 2002.
COSTS AND EXPENSES
The Company's 3% increase in operating expenses from $583,024 for the
three-month period ended September 30, 2000 to $601,051 for the three-month
period ended September 30, 2001 is due primarily to the addition of certain
Company officer salaries and increases in staff wages. Having foregone
compensation since the Company's inception in April of 1997 through the period
ended December 31, 2000, Chairman and Chief Executive Officer Tom Winters and
President and Director Richard Langley now receive salaried compensation.
Selling, general and administrative expenses increased 9.4% from $457,251 for
the three-month period ended September 30, 2000 to $500,138 for the same period
ended September 30, 2001. Costs directly associated with day-to-day operations,
such as medical equipment, supplies, and staff wages for the North Carolina and
Florida mobile surgery units remained constant during the three-month period
ended September 30, 2001 when compared to the three-month period ended September
30, 2000.
As the Company continues to expand, the Company will incur additional costs for
personnel. In order for the Company to attract and retain quality personnel, the
Company anticipates it will continue to offer competitive salaries to current
and future employees.
Depreciation and amortization expense for the three-month period ended September
30, 2001 was $82,622, a decrease of $206 from the same period in 2000. Both of
the Company's mobile surgical units were depreciated over the entire period of
three months ended September 30, 2001.
7
Interest expense for the three-month period ended September 30, 2001 was
$18,251; a decrease of $24,654, or 57%, from $42,905 for the same period ended
September 30, 2000. The decrease in interest expense is due to the maturation of
bank loans that were needed to finance the construction and purchase of the
Florida mobile surgical unit.
For the three-month period ended September 30, 2001, an income tax provision of
$57,353 was charged to recognize federal, Florida state and North Carolina state
income tax liabilities. For the three-month period ended September 30, 2000, an
income tax provision of $117,309 was charged. The decrease in income tax
provision is attributed to an income tax overpayment of $102,100 for the period
of twelve months ended December 31, 2000.
Nine Months Ended September 30, 2001 and 2000
---------------------------------------------
REVENUES
The Company's total revenues were $2,619,481 for the nine-month period ended
September 30, 2001 compared to $2,618,212 for the same period ended September
30, 2000. Revenue for the nine-month period ended September 30, 2001 is
attributed to the Florida and North Carolina State Department of Corrections
contracts.
The Company reported net income from continuing operations for the nine-month
period ended September 30, 2001 of $500,055 compared to $601,618 for the
nine-month period ended September 30, 2000, a decrease in earnings of $101,563,
or 16.9%. Net income for the nine-month period ended September 30, 2001 was
affected by the addition of certain Company officer salaries, increases in
wages, promotional expenses, insurance premiums and increased depreciation
expense.
COSTS AND EXPENSES
The Company's 20.8% increase in operating expenses from $1,618,385 for the
nine-month period ended September 30, 2000 to $1,954,711 for the nine-month
period ended September 30, 2001 is due primarily to the addition of certain
Company officer salaries, increases in wages, insurance premiums, promotional
expenditures and depreciation expense. Having foregone compensation since
inception through the period ended December 31, 2000, Chairman and Chief
Executive Officer Tom Winters and President and Director Richard Langley now
receive salaried compensation. The increase in promotional expenses is directly
attributed to a promotional campaign, which included nationwide television
airtime. Selling, general and administrative expenses increased 28.8% from
$1,248,720 for the nine-month period ended September 30, 2000 to $1,608,494 for
the same period ended September 30, 2001. Costs directly associated with
day-to-day operations, such as medical equipment, supplies, and staff wages for
the North Carolina and Florida mobile surgery units, remained constant during
the nine-month period ended September 30, 2001 when compared to the nine months
period ended September 30, 2000.
As the Company continues to expand, the Company will incur additional costs for
personnel. In order for the Company to attract and retain quality personnel, the
Company anticipates it will continue to offer competitive salaries to current
and future employees.
Depreciation and amortization expense for the nine-month period ended September
30, 2001 was $255,575, an increase of $16,254, or 6.8%, from the same period in
2000. The increase is attributable to the addition of new equipment in Florida
and North Carolina. Both of the Company's mobile surgical units were depreciated
over the entire period of nine months ended September 30, 2001.
Interest expense for the nine-month period ended September 30, 2001 was $90,642,
a decrease of $39,702, or 30.5%, from $130,344 for the same period ended
September 30, 2000. The decrease in interest expense is due to the maturation of
bank loans needed to finance the construction and purchase of the Florida mobile
surgical unit.
For the nine-month period ended September 30, 2001, an income tax provision of
$231,202 was charged to recognize federal, Florida state and North Carolina
state income tax liabilities. For the nine-month period ended September 30,
2000, an income tax provision of $398,209 was charged. The decrease in income
tax provision is attributed to an income tax overpayment of $102,100 for the
period twelve months ended December 31, 2000.
8
LIQUIDITY AND CAPITAL RESOURCES
-------------------------------
As of September 30, 2001, the Company had working capital of $2,125 compared to
a deficit of $248,061 at December 31, 2000. The increase in working capital is
attributed to a $380,139 increase in current assets compared to a current
liability increase of $129,953. The increase in current liabilities is primarily
attributable to a $102,833 increase in current maturities of long-term debt.
The Company's accounts payable balance as of September 30, 2001 was $103,669, a
$16,524, or a 19% increase, from the balance as of December 31, 2000. As of
September 30, 2001, current maturities of long-term debt increased 16% to
$744,661 as of September 30, 2001 from $641,828 as of December 31, 2000. The
increase in current maturities of long-term debt is primarily attributable to
the maturation of a loan from shareholders in the amount of $310,042.
The Company generated cash flows from operations of $746,462 for the nine-month
period ended September 30, 2001 and $1,020,168 for the nine-month period ended
September 30, 2000, a decrease of $273,706, or 26.8%. The decrease in cash flow
from operating activities for the nine-month period ended September 30, 2001
when compared to the year-ago period is primarily attributable to the decrease
in the Company's net income from operations of $101,563 when compared to the
same period ended September 30, 2000, a $65,247 change in receivables, and a
$269,374 change in income tax payable when compared to the nine month period
ended September 30, 2000.
Cash flows from investing activities of $226,550 for the nine-month period ended
September 30, 2001 were derived from the sale of equipment. Cash flows used in
investing activities involved the acquisition of $ 87,041 of surgical and
medical equipment. The equipment was placed in the Company's North Carolina and
Florida facilities.
Cash flows used in financing activities were $473,313 during the nine-month
period ended September 30, 2001. The Company repaid $404,651 in bank loans and
used $68,662 for the purchase of Company stock during the nine-month period
ended September 30, 2001.
While the Company has raised capital though bank loans to meet its current
working capital and facility and equipment financing needs, additional financing
will be required in order to acquire additional surgical facilities. The Company
is seeking debt financing in order to provide for these expansions and for
working capital. There are no assurances the Company will be successful in
raising the funds required.
The Company has borrowed funds from significant shareholders of the Company in
the past to satisfy certain obligations. In addition, Company officers and
significant shareholders guarantee all of the Company's bank debt.
The Company plans to develop new sites for its mobile surgical units. The
Company plans to obtain financing for these units through bank loans. There can
be no assurance that management will be successful in its efforts to obtain the
financing necessary to fund the Company's growth or that contracts for future
sites will be obtained.
The effect of inflation on the Company's revenue and operating results was not
significant. The Company's operations are in the southeastern United States and
there are no seasonal aspects that would have a material adverse effect on the
Company's financial condition or results of operations.
9
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities and Use of Proceeds
Not Applicable
Item 3. Defaults Upon Senior Securities
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
Not Applicable
Item 5. Other Information
None
Item 6. Exhibits and reports on Form 8-K
(a) Exhibits
The following documents are filed herewith or have been included as exhibits to
previous filings with the Commission and are incorporated herein by this
reference:
Exhibit No. Exhibit
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3.1 Articles of Incorporation and of the Company and all
amendments thereto (filed as Exhibits 3.1, 3.2 and 3.3 to
Amendment No. 1 to the Company's registration statement on
Form 10-SB on April 13, 2000, and incorporated herein by
reference)
3.2 By-laws of the Company (filed as Exhibit 3.4 to Amendment No.
1 to the Company's registration statement on Form 10-SB on
April 13, 2000, and incorporated herein by reference)
4.1 Articles Fourth, Tenth and Eleventh of the Articles of
Incorporation of the Company, as amended (filed as Exhibits
3.1. 3.2 and 3.3 to Amendment No. 1 to the Company's
registration statement on Form 10-SB on April 13, 2000, and
incorporated herein by reference)
4.2 Article I of the By-laws of the Company (filed as Exhibit 3.4
to Amendment No. 1 to the Company's registration statement on
Form 10-SB on April 13, 2000, and incorporated herein by
reference)
10
10.1 Consulting Agreement dated April 26, 1999, by and between the
Company and TransGlobal Financial Corporation (filed as
Exhibit 10.1 to the Company's registration statement on Form
10-SB on April 13, 2000, and incorporated herein by reference)
10.2 Form of Stockholders Lock-up Agreement dated March 25, 1999,
by and between the Company and American Mobile Surgical
Services, Inc. (filed as Exhibit 10.2 to the Company's
registration statement on Form 10-SB on April 13, 2000, and
incorporated herein by reference)
10.3 Agreement by and between the Company's subsidiary, U.S.
Medical Group (Florida), Inc., and the Florida Department of
Corrections dated April 2, 1997, with amendments (filed as
Exhibit 10.3 to the Company's registration statement on Form
10-SB on April 13, 2000, and incorporated herein by reference)
10.4 Agreement by and between the Company's subsidiary, U.S.
Medical Group (Florida), Inc., and the North Carolina
Department of Corrections dated October 15, 1999, with
amendments (filed as Exhibit 10.4 to the Company's
registration statement on Form 10-SB on April 13, 2000, and
incorporated herein by reference)
10.5 Employment agreement by and between the Company and Dr. Thomas
F. Winters dated January 2, 2001 (filed herewith)
10.6 Employment agreement by and between the Company and Richard H.
Langley dated January 2, 2001 (filed herewith)
11 Computation of earnings per common share (included in
unaudited statement of operations of the Company in Item 1
hereof)
21 Subsidiaries of the registrant (filed as Exhibit 21 to the
Company's annual report on Form 10-KSB for the year ended
December 31, 2000, and incorporated herein by reference)
(b) Reports on Form 8-K
Not applicable.
11
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
U.S. MEDICAL GROUP, INC.
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(Registrant)
Date November 15, 2001 By: /s/ Charles Baumann
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Charles Baumann
Chief Financial Officer
12
EXHIBIT INDEX
Exhibit No. Exhibit
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3.1 Articles of Incorporation and of the Company and all
amendments thereto (filed as Exhibits 3.1, 3.2 and 3.3 to
Amendment No. 1 to the Company's registration statement on
Form 10-SB on April 13, 2000, and incorporated herein by
reference)
3.2 By-laws of the Company (filed as Exhibit 3.4 to Amendment No.
1 to the Company's registration statement on Form 10-SB on
April 13, 2000, and incorporated herein by reference)
4.1 Articles Fourth, Tenth and Eleventh of the Articles of
Incorporation of the Company, as amended (filed as Exhibits
3.1. 3.2 and 3.3 to Amendment No. 1 to the Company's
registration statement on Form 10-SB on April 13, 2000, and
incorporated herein by reference)
4.2 Article I of the By-laws of the Company (filed as Exhibit 3.4
to Amendment No. 1 to the Company's registration statement on
Form 10-SB on April 13, 2000, and incorporated herein by
reference)
10.1 Consulting Agreement dated April 26, 1999, by and between the
Company and TransGlobal Financial Corporation (filed as
Exhibit 10.1 to the Company's registration statement on Form
10-SB on April 13, 2000, and incorporated herein by reference)
10.2 Form of Stockholders Lock-up Agreement dated March 25, 1999,
by and between the Company and American Mobile Surgical
Services, Inc. (filed as Exhibit 10.2 to the Company's
registration statement on Form 10-SB on April 13, 2000, and
incorporated herein by reference)
10.3 Agreement by and between the Company's subsidiary, U.S.
Medical Group (Florida), Inc., and the Florida Department of
Corrections dated April 2, 1997, with amendments (filed as
Exhibit 10.3 to the Company's registration statement on Form
10-SB on April 13, 2000, and incorporated herein by reference)
10.4 Agreement by and between the Company's subsidiary, U.S.
Medical Group (Florida), Inc., and the North Carolina
Department of Corrections dated October 15, 1999, with
amendments (filed as Exhibit 10.4 to the Company's
registration statement on Form 10-SB on April 13, 2000, and
incorporated herein by reference)
10.5 Employment agreement by and between the Company and Dr. Thomas
F. Winters dated January 2, 2001 (filed herewith)
10.6 Employment agreement by and between the Company and Richard H.
Langley dated January 2, 2001 (filed herewith)
11 Computation of earnings per common share (included in
unaudited statement of operations of the Company in Item 1
hereof)
21 Subsidiaries of the registrant (filed as Exhibit 21 to the
Company's annual report on Form 10-KSB for the year ended
December 31, 2000, and incorporated herein by reference)
13
EXHIBIT 10.5
January 2, 2001
Dr. Thomas F. Winters:
This letter agreement will permit you to perform services for, US
Medical Group, Inc. (Company) as an employee under the following terms and
conditions:
1. You agree to perform the following services for Company:
Chairman and Chief Executive Officer
2. The term of this employment agreement is for an unspecified period
beginning on January 2, 2001.
3. Unless otherwise mutually agreed and approved by the board of
directors, compensation for employment performed hereunder during the term shall
be $120,000 per year. In addition, U.S. Medical Group will reimburse you for any
business expenses incurred while providing such services. All expenses over
$200.00 must be pre-approved by U.S. Medical Group.
4. This agreement may be terminated at the option of either party by
giving thirty days' written notice. In the event of termination, the Company
shall be obligated to pay only for services performed up to the date of
termination.
5. Any information (written, oral, or observed) received by you during
the course of you providing services to Company will be deemed to be
confidential. This information may only be used in the provision of services
under this agreement and may not be revealed to any third parties during this
agreement or after its expiration without the prior written consent of Company.
6. During the term of this agreement, you shall refrain from action or
conduct which is inimical or opposed to the interest of Company. Company shall
be advised promptly of any possible conflict of interest.
7. This agreement constitutes the entire agreement between the parties,
and any amendment to this agreement must be in writing and signed by both
parties.
If you agree to the above terms, please sign both copies of this agreement in
the space below, and retain one copy for your files.
Thomas Winters
--------------------------------
(Name)
/s/ Thomas Winters
--------------------------------
(Signature)
3/13/01
--------------------------------
(Date)
US Medical Group is looking forward to working with you and anticipates long
term success.
Regards,
/s/ Sandra Thompson
Sandra Thompson, Chief Operating Officer
EMPLOYEES CONFIDENTIAL DISCLOSURE AGREEMENT
In consideration of my employment with US Medical Group, Inc. (hereinafter
"Employer") its subsidiaries or affiliates, and of the salary/wages/fees I am
receiving and shall receive from time to time, I hereby endorse and accept
personally the duties and obligations undertaken by Employer to keep secret and
confidential any proprietary information received either observed, orally or in
writing. In the event that my employment should terminate, either voluntarily or
involuntarily, prior to the termination of Employer's obligations under
agreement, I also agree that my obligation of confidentiality hereunder shall
survive said termination.
/s/ Thomas Winters
--------------------------------
(Signature)
3/13/01
--------------------------------
(Date)
/s/ Sandra L. Thompson
--------------------------------
(Witness)
3/13/01
--------------------------------
(Date)
EXHIBIT 10.6
January 2, 2001
Mr. Richard H. Langley:
This letter agreement will permit you to perform services for, U.S.
Medical Group, Inc. (Company) as an employee under the following terms and
conditions:
2. You agree to perform the following services for Company:
President and Director
2. The term of this employment agreement is for an unspecified period
beginning on January 2, 2001.
5. Unless otherwise mutually agreed and approved by the board of
directors, compensation for employment performed hereunder during the term shall
be $110,000 per year. In addition, U.S. Medical Group will reimburse you for any
business expenses incurred while providing such services. All expenses over
$200.00 must be pre-approved by U.S. Medical Group.
6. This agreement may be terminated at the option of either party by
giving thirty days' written notice. In the event of termination, the Company
shall be obligated to pay only for services performed up to the date of
termination.
5. Any information (written, oral, or observed) received by you during
the course of you providing services to Company will be deemed to be
confidential. This information may only be used in the provision of services
under this agreement and may not be revealed to any third parties during this
agreement or after its expiration without the prior written consent of Company.
6. During the term of this agreement, you shall refrain from action or
conduct which is inimical or opposed to the interest of Company. Company shall
be advised promptly of any possible conflict of interest.
7. This agreement constitutes the entire agreement between the parties,
and any amendment to this agreement must be in writing and signed by both
parties.
If you agree to the above terms, please sign both copies of this agreement in
the space below, and retain one copy for your files.
Richard H. Langley
--------------------------------
(Name)
/s/ Richard H. Langley
--------------------------------
(Signature)
March 23, 2001
--------------------------------
(Date)
U.S. Medical Group is looking forward to working with you and anticipates long
term success.
Regards,
/s/ Tom Winters
Dr. Thomas F. Winters, Chairman and CEO
EMPLOYEES CONFIDENTIAL DISCLOSURE AGREEMENT
In consideration of my employment with U.S. Medical Group, Inc. (hereinafter
"Employer") its subsidiaries or affiliates, and of the salary/wages/fees I am
receiving and shall receive from time to time, I hereby endorse and accept
personally the duties and obligations undertaken by Employer to keep secret and
confidential any proprietary information received either observed, orally or in
writing. In the event that my employment should terminate, either voluntarily or
involuntarily, prior to the termination of Employer's obligations under
agreement, I also agree that my obligation of confidentiality hereunder shall
survive said termination.
/s/ Richard H. Langley
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(Signature)
March 23, 2001
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(Date)
/s/ Linda M. Topping
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(Witness)
March 23, 2001
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(Date)