**Exhibit10.01**

** **

**SETTLEMENT AGREEMENT AND MUTUAL RELEASE**

 

This Settlement Agreement and MutualRelease (the “Settlement Agreement”) is entered into by and among **Lifescape,LLC** (“Lifescape”),**ValueOptions,Inc.** (“ValueOptions”), **FHC Health Systems, Inc.** (“FHC”), and **ZambaSolutions** (“Zamba”), as of the 1st day of October, 2001,(the “Effective Date”).

 

WHEREAS, Zamba has provided to Lifescapeconsulting services which have contributed to the creation of various computersoftware applications and related intellectual property (the “Zamba Assets”);and

 

WHEREAS, Lifescape has been and iscurrently unable to pay Zamba for the services rendered in connection with thecreation of the Zamba Assets and Zamba has demanded that the Zamba Assets bereturned to it  until  full payment has been made; and

 

WHEREAS,Zamba has provided to ValueOptions various consulting services; and

 

WHEREAS,ValueOptions desires to acquire the Zamba Assets.

 

NOW, THEREFORE,   in consideration of the covenants contained herein, the partieshereto agree as set forth below:

 

1.             **Transferof Zamba Assets to ValueOptions**. Zamba hereby directs  Lifescapeto transfer to ValueOptions the Zamba Assets.

 

2.             **Consideration**.  In consideration of the transfer of the Zamba Assets toValueOptions, FHC and ValueOptions jointly and severally agree to pay to Zambathe sum of  $ 1, 680,000 as follows: $280,000 on the Effective Date, and $ 280,000 on the first business day of eachof the next five (5) months.

 

3.             **Default**.  If any payment required to be made underSection 2 of the Settlement Agreement is not made within five (5) days of thedelivery of a written notice that a required payment has not been made, viafacsimile to the chief financial officer of FHC at ******: (i) the aggregatepayment due under the Settlement Agreement shall be increased to $ 2,080,000and the entire unpaid balance shall be due immediately and (ii) all right,title and interest in the Zamba Assets shall be returned to Zamba until thepayment described in subsection (i) hereof has been paid in full.

 

4.             **Mutual****Releases**.

(a)           Release of Lifescape, FHC andValueOptions.  In consideration ofand upon the receipt of all amounts due under this Settlement Agreement, Zamba,for itself and on behalf of its officers, directors, members, subsidiaries,affiliates, parent companies, successors, assigns, agents, underwriters,attorneys, sureties, insurers and representatives, does and shall irrevocablyand unconditionally remise, release and forever discharge Lifescape,  FHC, ValueOptions, their officers,directors, members, subsidiaries, affiliates, parent companies, successors,assigns, agents, underwriters, attorneys, sureties, insurers andrepresentatives from any and all claims, demands and causes of actions of anynature whatsoever arising out of or related to the Zamba Assets.

(b)           Release of Zamba.  In consideration of and upon the receipt ofthe Zamba Assets, each of Lifescape, FHC and ValueOptions, for itself and onbehalf of its officers, directors, members, subsidiaries, affiliates, parent companies,successors, assigns, agents, underwriters, attorneys, sureties, insurers andrepresentatives, does and shall irrevocably and unconditionally remise, releaseand forever discharge Zamba, its officers, directors, members, subsidiaries,affiliates, parent companies, successors, assigns, agents, underwriters,attorneys, sureties, insurers and representatives from any and all claims,demands and causes of actions of any nature whatsoever arising out of orrelated to the Zamba Assets.

 

5              **Nonadmission of Liability**.  The parties fully understand and agree thatthis Settlement Agreement represents the compromise of disputed claims and isnot an admission of liability or concession of any legal position taken by anyparty.

 

6.             **Adviceof Counsel**.  The parties tothis Settlement Agreement acknowledge that they have been fully advised bycounsel of their own choosing with respect to the terms of this SettlementAgreement.

 

7.             **Venue and Choice of Law**.  Any dispute, claim, or cause of actionarising out of or related to the interpretation of or any default under thisAgreement shall be governed by the laws of the State of Minnesota, and theparties to this Agreement hereby agree that venue for such action shall liesolely in the State of Minnesota.  Ifany part, term or provision of this Settlement Agreement is held by a court oradministrative body to be illegal or in conflict with any law, or by statutebecomes illegal or in conflict with any law, the validity of the remainingprovision shall not be affected and the rights and obligations of the partiesshall be construed and enforced as if this Settlement Agreement did not containthe particular, invalid part, term or provision. The parties agree to submit topersonal jurisdiction of the courts of the State of Minnesota.

 

8.**             Costsof Collection.**  In the eventeither party commences litigation arising out of or related to this SettlementAgreement, the prevailing party shall be entitled to its fees and costsincluding reasonable attorney’s fees. and any fees and costs associated withalternative dispute resolution, including reasonable attorney’s fees.

 

9.             **EntireAgreement.**  This SettlementAgreement and the attached Exhibits constitutes andcontains the entire agreement and understanding between the parties concerningthe subject matters addressed in this Settlement Agreement between the parties,and supersedes and replaces all prior settlement negotiations and allsettlement agreements proposed or otherwise, whether written or oral,concerning the subject matter of this Settlement Agreement.  Any statements, promises or inducements madeamong the parties that are not contained in this Settlement Agreement shall beinvalid and nonbinding.  No waiver ofany breach of any term or provision of this Settlement Agreement shall beconstrued to be, nor shall be, a waiver of any other breach of any term orprovision of the Settlement Agreement. No waiver shall be binding unless in writing and signed by the partywaiving the breach.

 

10.           **Cooperation.**  The parties agree to cooperate fully andexecute any and all supplementary documents and take all additional actionswhich may be necessary and appropriate to give full force and effect to thebasic terms and intent of this Settlement Agreement.

 

11.           **Counterparts.**  This Agreement may be executed in multiplecounterparts, each of which shall constitute an original agreement, but allsuch counterparts taken together shall constitute one and the same agreement.

 

 

INWITNESS WHEREOF, the parties have the caused this Settlement Agreement andMutual Release to be executed by them or on their behalf by their respectiverepresentatives as of the Effective Date.

 
|   | Lifescape, LLC            |
|--------|---------------------------|
|   |                      |   |
|   | By: /s/                   | Ronald  Dozoretz |
|   |                      | Ronald I. Dozoretz, Manager of FHC Internet Services, L.C., |
|   |                      | the managing member of Lifescape, LLC |
|   |                      |   |
|   | ValueOptions,  Inc.       |
|   |                      |   |
|   | By: /s/                   | Elliot  Gerson |
|   |                      | Elliot F. Gerson |
|   |                      |   |
|   | Its  President            |
|   |                      |
|   |                      |
|   | FHC Health  Systems, Inc. |
|   | By: /s/                   | Elliot  Gerson |
|   |                      | Elliot Gerson, |
|   |                      |   |
|   | Its  President       |   |
|   |                      |   |
|   | Zamba  Solutions          |   |
|   |                      |   |
|   | By: /s/ Mike  Carrel      |   |
|   |                      |   |
|   | Its CFO                   |   |
|        |                           |  |  |