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                                                                   EXHIBIT 10.32

                                          2C Solutions, LLC
                                          18535 Devonshire St.
                                          Suite 501
                                          Northridge, CA 91324

                                          January 13, 2000

Richard Auger
Chairman
Health Systems Design
1111 Broadway
18(th) Floor
Oakland, CA 94607

e-mail:  rauger@hsdc.com

RE:  Southam Management Agreement--Revised

Dear Rich:

    This is to follow up on discussions with you and Matt regarding my
continuing role in the leadership and management of HSD.

    My letter of July 27, 1999, signed by you on behalf of HSD, set forth our
agreement regarding my role as interim CEO of HSD. That agreement was based on
the premise that I would serve as interim CEO until a new CEO was appointed
pursuant to a search process that was in progress. The Agreement anticipated
that the engagement would last 2-5 months, would involve about 75% of my time
and that I would be at HSD's Oakland office, or with clients, 2-3 days per week.

    My involvement with HSD has been extensive. It has involved changes to
organizational structure and personnel. In addition, it has involved the
exploration of strategic opportunities that can stimulate HSD's growth and/or
allow shareholders to achieve liquidity and economic value. I believe that we
are making progress in our efforts to energize and reposition the company for
future success.

    For several reasons the Board has decided to put a hold on the search for a
new CEO while the Company pursues various alternatives. The decision to have me
continue in my role and not hire a new CEO at this time benefits the Company. It
provides continuity, avoids the difficulty of installing a new CEO at a time of
transition, avoids the dilution that would take place with a large option
package and avoids the financial cost of the full compensation package required
to recruit a new CEO.

    I have greatly enjoyed the opportunity to work with you and other members of
the HSD team over the last several months. Thanks for your support and guidance.
The only "trade-offs" have been the significant time required away from my
family and the opportunity cost relative to the development of 2C and other
opportunities. I look forward to continuing in my role as President and CEO at
least until we complete the current exploration of strategic options and move
HSD to its next stage.

    Given the change in scope and duration of my engagement it is appropriate to
adjust our earlier agreement. I propose the following:

    ROLE AND RESPONSIBILITIES:

    I will continue in my role as President and CEO of HSD for at least the
minimum term outlined below. In this role I will report to and work closely with
the Board of Directors. I will have the authority and responsibility usually
associated with the President/CEO position. We will not use the "interim" title
to describe my role to HSD staff and outside parties.
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    OBJECTIVES AND GOALS

    Many of the goals remain the same as in our original July 27 letter
agreement. I will update these goals with you and provide them as a separate
document. I look forward to reviewing and modifying these goals with you on an
ongoing basis.

    SCOPE AND TERM:

    This revised agreement will begin December 1, 1999 and continue until at
least September 30, 2000. Thereafter, it will continue on a quarter-to-quarter
basis. On or after July 1, 2000 it can be terminated, without cause, by either
party, effective the last day of the month following ninety (90) days prior
written notice.

    During the term of this agreement, I will devote essentially all my
professional work time to the activities of HSD. I will be present in the
Oakland office and/or at client sites an average of at least three days per
week. I will take approximately fifteen days of vacation, not including legal
holidays, during the period ending in September. I will of course be available
on a 7/24 basis by phone, e-mail, etc. to facilitate the effective operation of
the Company. I will continue in my capacity as a member of 2C Solutions and will
maintain some non-HSD professional activities and investments that require no
more than a few days per month and do not compete with the business of HSD. I
have discussed these with you and will update you at any time.

    COMPENSATION:

    My compensation package will be as follows:

    - Cash compensation will be $35,000 (thirty five thousand dollars) per month
      beginning with the month of December.

    - HSD will pay for or reimburse reasonable expenses related to HSD business.

    - HSD will pay for or reimburse transportation and reasonable lodging costs
      incurred as a result of my travel between my home in Southern California
      and Oakland.

    - I will not receive any additional options at this time. I will retain all
      existing options including those granted at the August meeting of the
      Board pursuant to our prior agreement.

    If, prior to September 30, 2000, HSD enters into a definitive agreement(s)
with respect to one or more transactions that result in a Change of Control of
the Company, and I have not terminated this agreement prior to the Change of
Control, I will be eligible for a "transaction bonus" payable immediately
following a Change of Control. For purposes of this provision a Change of
Control will mean the occurrence of any one of the following events:

    (i) a merger or acquisition in which the Company is not the surviving
        entity, except for a transaction the principal purpose of which is to
        change the State of the Company's incorporation;

    (ii) the sale, transfer or other disposition of all or substantially all of
         the assets of the Company in liquidation or dissolution of the Company;

    (ii) a transfer of all or substantially all of the Company's assets pursuant
         to a partnership or joint venture agreement or similar arrangement
         where the Company's resulting interest is less than fifty percent
         (50%);

   (iii) any reverse merger in which the Company is the surviving entity but in
         which fifty percent (50%) or more of the Company's outstanding voting
         stock is transferred to holders different from those who held the stock
         immediately prior to such merger;

    (ii) on or after the date hereof, a change in ownership of the Company
         through an action or series of transactions, such that any person is or
         becomes the beneficial owner, directly or indirectly, of

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         securities of the Company representing fifty percent (50%) of more of
         the securities of the combined voting power of the Company's
         outstanding securities; or

    (vi) a majority of the members of the Board are replaced during any
         twelve-month period by directors whose appointment or election is not
         endorsed by a majority of the members of the Board prior to the date of
         such appointment or election.

    - The amount of the transaction bonus will be based on the transaction price
      (or in the case of more than one transaction, the weighted average of the
      price at which shares were sold) as follows:

<TABLE>
<CAPTION>
TRANSACTION PRICE/SHARE                BONUS PAYMENT
-----------------------                -------------
<S>                                    <C>
Less than $8.00/share                  $150,000

$8.00-$9.99/share                      $225,000 plus $850.00 (eight hundred fifty dollars)
                                       for each cent per share in excess of $8.00 per share

$10.00 or more per share               $400,000 plus $1,200 (one thousand two hundred
                                       dollars) for each cent per share in excess of $10.00
                                       per share
</TABLE>

    - I will be eligible for a "continuity and performance bonus," if this
      Agreement is still in effect or if I am still serving as President and/or
      CEO of HSD, on September 30, 2000. The bonus will be based on the
      following:

                    CONTINUITY AND PERFORMANCE BONUS PARAMETERS

<TABLE>
                       BONUS POTENTIAL         25%               50%               100%
                           AT 100%         AWARD LEVEL       AWARD LEVEL       AWARD LEVEL
<S>                    <C>               <C>               <C>               <C>
Revenue                $40,000           $30 million       $33 million       $42 million
Net Income (After      $30,000           $250,000          $1 million        $3 million
Tax)
Share Price Following  $100,000          $7.50             $9.00             $12.00
Third Quarter
Earnings Release
Share Price Following  $100,000          $7.50             $9.00             $12.00
Fourth Quarter
Earnings Release
</TABLE>

       -  Each of the measures will be evaluated independently.

       -  Performance levels between award levels will be pro-rated.

       -  No bonus will be paid for performance below the 25% award level

       -  Share price for purposes of this program will be based on the average
          of the highest closing prices for any 10 trading days out of the first
          20 trading days following the date of HSD's earnings releases for the
          fiscal third quarter (ending June 2000) and fiscal fourth quarter
          (ending September 2000).

       -  In the event the share price award is equal to or above $50,000 for
          either period, the Company may elect to pay up to 40% of the award in
          the form of a stock grant. The conversion price of the award to stock
          will be the same formula used to determine the share price for
          purposes of the bonus.

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       -  Income performance targets include accrual for my bonuses. The fiscal
          year revenue and income target bonuses will be paid to me following
          Board review of fiscal year end audited financial statements and
          confirmation that targets have been achieved. The share price target
          bonuses will be paid to me following completion of each measurement
          period and certification by HSD's Chief Financial Officer of the price
          to be used for purposes of this bonus.

       -  The parameters of this program will not be adjusted for any mergers,
          acquisitions or transactions.

       -  In the event a Change of Control occurs on or before June 30, 2000,
          resulting in a transaction related payment to me, I will not be
          eligible for any "Continuity and Performance Bonus" as described
          herein.

       -  In the event a Change of Control occurs after June 30, 2000 but prior
          to October 1, 2000, resulting in a transaction related payment to me,
          I will be eligible for the portion of the continuity and performance
          bonus program related to "Share Price Following 3(rd) Quarter Earnings
          Release." I will not be eligible for the portions of the continuity
          and performance bonus award related to "Share Price Following 4(th)
          Quarter Earnings Release," "Revenue," and "Net Income" described
          above.

       -  In the event this Agreement is not replaced by another agreement and
          continues beyond September 30, 2000, HSD will develop a Bonus
          program(s) for the Fiscal year ending September 2001.

    - I will be performing and billing these services as an independent
      consultant through 2C Solutions, LLC. I will not be provided with any
      other benefits customarily provided to employees, except as outlined
      above.

    - Monthly fees and any expenses will be billed on a monthly basis by 2C
      Solutions LLC and will be paid by HSD within 10 days.

    - The obligations regarding compensation, minimum term and notice of
      termination will apply to successor organizations in the event of a change
      of control of HSD. Disputes regarding this agreement, including disputes
      regarding the interpretation the transaction bonus, will be settled, if
      necessary, by binding arbitration.

    If this is acceptable please sign where indicated below and return a copy to
me.

Sincerely,

Arthur M. Southam, MD

Accepted on Behalf of HSD

                                    Date:

Richard Auger
Chairman

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