COMPENSATION AGREEMENT

THIS COMPENSATION AGREEMENT ("Agreement") is made this 13th day of August, 1999,
by and between  HealthStar,  Inc., an Illinois  corporation,  ("HEALTHSTAR"),  a
wholly owned subsidiary of HealthStar Corp., and Denise E. Nedza ("NEDZA"), Vice
President & Chief Financial Officer, HealthStar, Inc. The term of this Agreement
shall  commence  as of July 1, 1999 (the  "Effective  Date") and shall  continue
thereafter until June 30, 2000 (the "Termination Date").

BASE SALARY:  One Hundred Thirty Steven  Thousand  Dollars  ($137,000) per annum
payable on a bi-weekly basis less statutory and elective payroll deductions.

CAR ALLOWANCE:  Three Hundred Dollars  ($300.00) per month payable the first two
payrolls  of each  month.  This  amount  is to cover  all  expenses  related  to
automobile business travel.

TERMINATION:  This Agreement may be terminated by HEALTHSTAR  without notice for
"cause,"  which  includes  commission of a fraudulent,  illegal or dishonest act
adversely affecting HEALTHSTAR.

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

In  the  event  that  Nedza's  employment  is  terminated   "without  cause"  by
HEALTHSTAR,  Nedza  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  embodies the  complete,  full and  exclusive  understanding  of
HEALTHSTAR and Nedza 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 Nedza 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 be invalid,  illegal or  unenforceable  in any  respect,  such
invalidity,  illegality or unenforceability shall not effect 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 part 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 for Nedza.

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

                                        /s/ Stephen J. Carder    8/20/99
                                        ----------------------------------------
                                        Stephen J. Carder, Date
                                        President, HealthStar, Inc.

                                        /s/ Denise E. Nedza      8/20/99
                                        ----------------------------------------
                                        Denise E. Nedza, Date
                                        Vice President & Chief Financial Officer
                                        HealthStar, Inc.