COMPENSATION AGREEMENT

THIS COMPENSATION AGREEMENT ("Agreement") is by and between HealthStar, Inc., an
Illinois  corporation,  ("HEALTHSTAR"),  a wholly owned subsidiary of HealthStar
Corporation,  and Darren T.  Horndasch  ("HORNDASCH"),  Vice  President  & Chief
Operating Officer, HealthStar, Inc. The term of this Agreement shall commence as
of July 1, 1999 (the "Effective Date") and shall continue  thereafter until July
30, 2000 (the "Termination Date").

BASE SALARY: One Hundred Eighty Thousand Dollars ($180,000) per annum payable on
a bi-weekly basis less statutory and elective payroll deductions.

CAR ALLOWANCE: Two Hundred Thirty Dollars, Seventy-Seven cents ($230.77) payable
bi-weekly  totaling six thousands  ($6000) per year. This amount is to cover all
expenses related in automobile business travel.

If Horndasch  voluntarily resigns or is terminated for "cause," at the option of
the Company, Horndasch forfeits any amounts that may be due under this Agreement
as of his  termination  date or which may  become due  thereafter  which are not
required to be paid out according to Illinois law. In case of Horndasch's death,
any amounts owed, including salary will be payable to his estate.

In the event  that  Horndasch's  employment  is  terminated  "without  cause" by
HEALTHSTAR,  Horndasch  shall receive a 90-day  written notice of termination of
employment  and shall be  compensated  according to the terms of this  agreement
during this period.

MODIFICATIONS:

This Agreement is the complete,  full and exclusive  understanding of HEALTHSTAR
and Horndasch  with respect to  Compensation  and they  supersede and cancel all
prior agreements,  written or oral,  between the parties hereto. Any amendments,
additions,  or  supplements  to or  cancellation  of  this  Agreement  shall  be
effective and binding on HEALTHSTAR  and Horndasch only if in writing and signed
by the President and approved by the Board of Directors.

If any one or more of the provisions  contained in this Agreement  shall for any
reason  be held to  invalid,  illegal  or  unenforceable  or any  respect,  such
invalidity,  illegality or unenforceability shall not affect the validity of any
other provision hereof and this Agreement shall be construed as if such invalid,
illegal or unenforceable provisions had never been contained herein.

This  Agreement  shall be  subject to and  governed  by the laws of the State of
Illinois. The failure of either party to insist, in one or more instances,  upon
performance of any of the terms and  provisions of this  Agreement  shall not be
construed as a waiver of a relinquishment  of any right granted  hereunder or of
the  future  performance  of any  such  term,  covenant  or  condition;  and the
obligation of both parties with respect thereto shall continue in full force and
effect.

This Agreement is not a contract of employment,  express or implied,  but merely
sets forth the compensation arrangement of Horndasch.

IN WITNESS  WHEREOF,  the parties have executed this Agreement on the date first
above written.

                                        /s/ Stephen J. Carder    7/22/99
                                        ----------------------------------------
                                        Stephen J. Carder, Date
                                        President, HealthStar, Inc.

                                        /s/ Darren T. Horndasch
                                        ----------------------------------------
                                        Denise E. Nedza, Date
                                        Vice President & Chief Operating Officer
                                        HealthStar, Inc.