Document:

EX-10.53 WAIVER AND AMENDMENT AGREEMENT

 

EXHIBIT 10.53

WAIVER AND AMENDMENT AGREEMENT

     THIS WAIVER AND AMENDMENT AGREEMENT (“Agreement”) dated as of February 7, 2008, by and between
ProxyMed, Inc., a Florida corporation doing business as MedAvant (“Parent”), ProxyMed Transaction
Services, Inc. (f/k/a MedUnite, Inc.), a Delaware corporation (“PTS”), ProxyMed Lab Services LLC
(f/k/a Key Communications Service, Inc.), a Delaware limited liability company ) (“PLS” and
together with Parent and PTS, the “Companies” and each, a “Company”), LV Administrative Services,
Inc., as administrative and collateral agent (“Agent”) on behalf of Laurus Master Fund, Ltd., a
Cayman Islands company (“Laurus”).

BACKGROUND

     The Companies and Laurus are parties to a Security and Purchase Agreement, dated as of
December 6, 2005 (as amended, modified, restated or supplemented from time to time, the “Security
Agreement”) pursuant to which Lender provides the Companies with certain financial accommodations.

     There are various Events of Default that may now exist under the Security Agreement and the
Ancillary Agreements referred to therein (as amended, modified, restated or supplemented from time
to time, collectively, the “Documents”) as listed on Exhibit A annexed hereto (“Designated
Defaults”) by reason of which Laurus has no obligation to make any additional Revolving Loans and
Laurus has the full legal right to exercise its rights and remedies under the Security Agreement.
The Companies have requested that Laurus waive the Designated Defaults and that Laurus continue to
make Revolving Loans to the Companies. Laurus is prepared to waive the Designated Defaults and
continue to make Revolving Loans to the Companies on the terms and conditions set forth below.

AGREEMENT

     In consideration of the foregoing and of the mutual promises and covenants herein contained,
it is agreed:

     1. Definitions. All capitalized terms not otherwise defined herein shall have the
meanings given to them in the Security Agreement.

     2. Acknowledgement. Each Company acknowledges that the Designated Defaults have
occurred and exist as of the date hereof, that any and all cure periods set forth in the Documents
have expired, and each Company is unconditionally obligated to pay, jointly and severally, all of
its liabilities to Laurus including all Obligations, all without defense, setoff or counterclaim of
any kind or nature whatsoever.

     3. Outstanding Obligations. Each Company hereby affirms and acknowledges that (i) as
of February 4, 2008, there is presently outstanding loans and advances in the aggregate principal
amount of $4,059,115.70, together with accrued interest thereon and costs and expenses

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(collectively, the “Amount”) and (ii) the Amount is a valid obligation of the Companies and is
due and owing without defense, claim, setoff or counterclaim of any kind or nature whatsoever.

     4. Waiver. Agent, on behalf of Laurus, hereby waives the Designated Defaults.

     5. Covenants of the Companies. From and after the date hereof through and including
the date upon which all Obligations owing to Laurus and its affiliates by the Companies shall have
been paid in full, unless otherwise waived, the Companies shall:

          (a) Companies covenant and agree to continue to retain a workout consulting firm selected by
Companies and acceptable to Laurus (the “Consultant”). Companies shall fully cooperate with the
Consultant and shall authorize the Consultant to provide such information and reports from time to
time with respect to Companies and its financial condition, business, assets, liabilities and
prospects, as Laurus shall from time to time request. All fees and expenses of the Consultant
shall be solely the responsibility of Companies and in no event shall Laurus have any liability or
responsibility for the payment of any such fees or expenses, nor shall Laurus have any obligation
or liability to Companies or any other person by reason of any acts or omissions of the Consultant.

     6. Amendments to Security Agreement. Subject to the conditions precedent set forth in
Section 18 hereof, the Security Agreement is hereby amended as follows:

          (a) The Security Agreement is hereby amended by inserting the following new Section 2(a)(vii)
immediately following existing Section 2(a)(vi):

     “(vii) During the period from February 29, 2008 through April 30, 2008, at the time of
each requested borrowing by the Companies, but no less frequently than weekly the Companies
shall submit a report, reasonably satisfactory in form and substance to Laurus’ (each, a
“Cumulative Transaction Report”) stating that (1) the Companies’ “cumulative transactions”
and “cumulative cash receipts” for the period commencing on February 7, 2008 through the
date immediately prior to the submission of the applicable Cumulative Transaction Report are
no more than five percent (5%) less than the projected targets for such “cumulative
transactions” and “cumulative cash receipts” set forth in the Approved Budget; and (2)
estimated “revenues” (which such estimates shall be made by the Company in good faith), for
the period commencing on February 7, 2008 through the date immediately prior to the
submission of the applicable Cumulative Transaction Report are no more than fifteen percent
(15%) less than the projected targets for such “revenues set forth in the Approved Budget;
(3) on the first business day of each month on and after the date hereof, that the
Companies’ actual :revenues” for the prior month period on a cumulative basis are no more
than 5% less than the projected targets for such “revenues” set forth in the Approved
Budget. The failure of the Companies to comply with any of clauses (1), (2) or (3) above
shall result in a “Budget Violation” which shall reduce the applicable Formula Amount as
further described in the definition of “Formula Amount.”

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          (b) The definitions of “Formula Amount,” “Maximum Availability Amount” and “Revolving Loan
Term” appearing in Annex A to the Security Agreement are hereby deleted in their entirety and the
following new definitions are inserted in lieu thereof:

     “‘Formula Amount’ means, subject to Section 2(a)(vii) of the Agreement, (i) for
the period commencing on February 7, 2008 through and including February 29, 2008,
$5,200,000, (ii) for the period commencing on March 1, 2008 through and including March 15,
2008, $5,700,000 and (iii) for the period commencing on March 16, 2008 through and including
the expiration of the Revolving Loan Term, $6,200,000; provided that,
notwithstanding the foregoing, in the event that a Budget Violation has occurred and is
continuing, the Formula Amount shall remain at or be reset to $5,200,000, as applicable,
through expiration of the Revolving Loan Term.”

     “‘Maximum Availability Amount’ means $6,200,000.”

     “‘Revolving Loan Term’ means the Closing Date through the close of business on
April 30, 2008.”

          (c) The following definition of “Approved Budget” is hereby added to Annex A to the Security
Agreement in the appropriate alphabetical order.

     “‘Approved Budget’ means the Companies’ budget for the period ending on April
30, 2008 attached hereto as Exhibit D.”

          (d) The Security Agreement is hereby amended by attaching the “Approved Budget” set forth in
Exhibit B hereto to the Security Agreement as new Exhibit D.

     7. Amendments to Revolving Note. Subject to the conditions precedent set forth in
Section 18 hereof, the Revolving Note is hereby amended as follows:

          (a) Section 1.1 of the Revolving Note is hereby amended by deleting said Section 1.1 in its
entirety and inserting the following new Section 1.1 in lieu thereof:

     “1.1 Contract Rate. Subject to Section 2.2, interest payable on the
outstanding principal amount of this Note (the “Principal Amount”) shall accrue at a
rate per annum equal to the Contract Rate (as hereafter defined). Interest shall be
(i) calculated on the basis of a 360 day year, and (ii) payable monthly, in arrears,
commencing on March 1, 2008 on the first business day of each consecutive calendar
month thereafter through and including the Maturity Date, and on the Maturity Date,
whether by acceleration or otherwise. For purposes hereof, the term “Contract Rate”
shall mean a fixed rate of twelve per cent (12%) per annum.

     8. Early Termination Payment. In connection with the reduction of the Maximum
Availability Amount from $18,000,000 to $6,200,000 (the “Partial Reduction”) and in accordance with
the existing terms and conditions of the Security Agreement relating to a partial termination of
the Maximum Availability Amount prior to expiration of the Revolving Loan

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Term, the Companies hereby agree, jointly and severally, to pay to Laurus $472,000 (i.e. 4.0% of
$11,800,000) by wire transfer in immediately available funds, which amount shall be in addition to
all other outstanding Obligations from time to time owing by the Companies to Laurus. Laurus
hereby agrees and acknowledges that it has received as of the date hereof the $472,000 payment
referenced above as made in connection with the Partial Reduction effected in Section 8(b) above.

     9. Representations and Warranties. Each Company hereby represents and warrants as
follows:

          (a) This Agreement, the Security Agreement and all other Documents are and shall continue to
be legal, valid and binding obligations of each Company and are enforceable against each Company in
accordance with their respective terms.

          (b) Each Company has the corporate or limited liability company power, as applicable, and has
been duly authorized by all requisite corporate and company action, as applicable, to execute and
deliver this Agreement and to perform its obligations hereunder. This Agreement has been duly
executed and delivered by each Company.

          (c) Each Company’s execution, delivery and performance of this Agreement does not and will not
(i) violate any law, rule, regulation or court order to which any Company is subject, (ii) conflict
with or result in a breach of any Company’s Articles/Certificate of Incorporation, by-laws,
Articles of Formation or Operating Agreement, as applicable, or any agreement or instrument to
which any Company is a party or by which it or its properties are bound or (iii) result in the
creation or imposition of any lien, security interest or encumbrance on any property of any
Company, whether not owned or hereafter acquired, other than liens in favor of Laurus or Agent.

          (d) No Company has any defense, counterclaim or setoff with respect to the Documents.

          (e) The Designated Defaults are the only Events of Default existing under the Security
Agreement and the Documents as of the date hereof and no other Events of Default would exist after
giving effect to this Agreement.

          (f) The recitals set forth in the Background paragraph above are truthful and accurate and are
an operative part of this Agreement.

          (g) Laurus has and will continue to have a valid first priority lien and security interest in
all Collateral, and each Company expressly reaffirms all security interests and liens granted to
Laurus and/or Agent pursuant to the Documents.

     10. Reaffirmation. Upon the effectiveness of this Agreement, each Company hereby
reaffirms all covenants, representations and warranties made in the Documents and acknowledges that
all such covenants, representations and warranties shall be deemed to have been remade and are true
and correct as of the effective date of this Agreement, except with respect to the Defined
Defaults.

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     11. Release. Each Company hereby releases, remises, acquits and forever discharges
Laurus and Agent and Laurus’ and Agent’s employees, agents, representatives, consultants,
attorneys, fiduciaries, officers, directors, partners, predecessors, successors and assigns,
subsidiary corporations, parent corporations, and related corporate divisions (all of the foregoing
hereinafter called the “Released Parties”), from any and all actions and causes of action,
judgments, executions, suits, debts, claims, demands, liabilities, obligations, damages and
expenses of any and every character, known or unknown, direct and/or indirect, at law or in equity,
of whatsoever kind or nature, for or because of any matter or things done, omitted or suffered to
be done by any of the Released Parties prior to and including the date of execution hereof, and in
any way directly or indirectly arising out of or in any way connected to this Agreement or the
Documents (all of the foregoing hereinafter called the “Released Matters”). Each Company
acknowledges that the agreements in this Section are intended to be in full satisfaction of all or
any alleged injuries or damages arising in connection with the Released Matters.

     12. Effect and Construction of Agreement. Except as expressly provided herein, the
Documents shall remain in full force and effect in accordance with their respective terms, and this
Agreement shall not be construed to:

          (a) impair the validity, perfection or priority of any lien or security interest securing the
Obligations;

          (b) waive or impair any rights, powers or remedies of Laurus and/or Agent under, or constitute
a waiver of, any provision of the Documents; or

          (c) constitute an agreement by Laurus and/or Agent or require Laurus and/or Agent to extend
the term of the Revolving Note or the time for payment of any of the Obligations.

     13. Conflicts. In the event of any express conflict between the terms of this
Agreement and any of the Documents, this Agreement shall govern.

     14. Presumptions. Each Company acknowledges that it has consulted with and been
advised by its counsel and such other experts and advisors as it has deemed necessary in connection
with the negotiation, execution and delivery of this Agreement and has participated in the drafting
hereof. Therefore, this Agreement shall be construed without regard to any presumption or rule
requiring that it be construed against any one party causing this Agreement or any part hereof to
be drafted.

     15. Conditions of Effectiveness. This Agreement shall become effective upon
satisfaction of the following conditions precedent: Agent shall have received (i) one original
copy of this Agreement executed by each Company.

     16. Entire Agreement. This Agreement sets forth the entire agreement among the
parties hereto with respect to the subject matter hereof. No Company has relied on any agreements,

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     17. representations, or warranties of Laurus, except as specifically set forth herein. Any
promises, representations, warranties or guarantees not herein contained and hereinafter made shall
have no force and effect unless in writing, signed by each party hereto. Each Company acknowledges
that it is not relying upon oral representations or statements inconsistent with the terms and
provisions of this Agreement.

     18. Further Assurance. Each Company shall execute such other and further documents
and instruments as Laurus and/or Agent may reasonably request to implement the provisions of this
Agreement.

     19. Benefit of Agreement. This Agreement shall be binding upon, inure to the benefit
of and be enforceable by the parties hereto and their respective permitted successors and assigns
as set forth in the Security Agreement and the other Documents. No other person or entity shall be
entitled to claim any right or benefit hereunder, including, without limitation, any third-party
beneficiary of this Agreement. Laurus’ and Agent’s agreement to forbear from enforcing certain of
its remedies does not in any manner limit the Companies’ obligations to comply with, and Laurus’
and Agent’s right to insist upon compliance with, each and every one of the terms of the Security
Agreement and the other Documents except as specifically modified herein.

     20. Severability. The provisions of this Agreement are intended to be severable. If
any provisions of this Agreement shall be held invalid or unenforceable in whole or in part in any
jurisdiction, such provision shall, as to such jurisdiction, be ineffective to the extent of such
invalidity or enforceability without in any manner affecting the validity or enforceability of such
provision in any other jurisdiction or the remaining provisions of this Agreement in any
jurisdiction.

     21. Governing Law, Jurisdiction, Venue. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applied to contracts to be performed
wholly within the State of New York. Any judicial proceeding brought by or against any Company
with respect to this Agreement or any related agreement may be brought in any court of competent
jurisdiction in the State of New York, County of New York, United States of America, and, by
execution and delivery of this Agreement, each Company accepts for itself and in connection with
its properties, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid
courts, and irrevocably agrees to be bound by any judgment rendered thereby in connection with this
Agreement. Nothing herein shall affect the right to serve process in any manner permitted by law
or shall limit the right of Laurus or Agent to bring proceedings against any Company in the courts
of any other jurisdiction. Each Company waives any objection to jurisdiction and venue of any
action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue
or based upon forum non conveniens. Any judicial proceeding by any Company against Laurus
and/or Agent involving, directly or indirectly, any matter or claim in any way arising out of,
related to or connected with this Agreement or any related agreement, shall be brought only in a
federal or state court located in the County of New York, State of New York.

     22. Waiver of Jury Trial. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY
RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING UNDER THIS
AGREEMENT, THE

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DOCUMENTS OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION
HEREWITH, OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES
HERETO OR ANY OF THEM WITH RESPECT TO THIS AGREEMENT, THE DOCUMENTS OR ANY OTHER INSTRUMENT,
DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED
HERETO OR THERETO IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN
CONTRACT OR TORT OR OTHERWISE AND EACH PARTY HEREBY CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS
AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENTS OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. IN
ADDITION, EACH PARTY WAIVES THE RIGHT TO CLAIM OR RECOVER IN ANY SUCH SUIT, ACTION OR PROCEEDING
ANY DAMAGES OTHER THAN OR IN ADDITION TO ACTUAL DAMAGES.

     23. Counterparts; Telecopied Signatures. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original and all of which taken together shall
constitute one and the same agreement. Any signature delivered by a party by facsimile
transmission shall be deemed to be an original signature hereto.

     24. Survival. All representations, warranties, covenants, agreements and undertakings
of each Company contained herein shall survive the repayment of all outstanding Obligations.

     25. Amendment. No amendment, modification, rescission, waiver or release of any
provision of this Agreement shall be effective unless the same shall be in writing and signed by
the parties hereto.

     26. Headings. Section headings in this Agreement are included herein for convenience
of reference only and shall not constitute a part of this Agreement for any other purpose.

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     IN WITNESS WHEREOF, this Agreement has been duly executed as of the day and year first written
above.

	 	 	 	 	 
	 	PROXYMED, INC.

 	 
	 	By:  	/s/ Peter E. Fleming, III
 	 
	 	 	Name:  	Peter E. Fleming, III 	 
	 	 	Title:  	EVP & General Counsel 	 
	 
	 	PROXYMED TRANSACTION SERVICES, INC.

 	 
	 	By:  	/s/ Peter E. Fleming, III
 	 
	 	 	Name:  	Peter E. Fleming, III 	 
	 	 	Title:  	EVP & General Counsel 	 
	 
	 	PROXYMED LAB SERVICES LLC

By: Proxymed Transaction Services, Inc., its sole
member

 	 
	 	By:  	/s/ Peter E. Fleming, III
 	 
	 	 	Name:  	Peter E. Fleming, III 	 
	 	 	Title:  	EVP & General Counsel 	 
	 
	 	LV ADMINISTRATIVE SERVICES, INC., as Agent

 	 
	 	By:  	/s/
Scott Bleustein	 
	 	 	Name:  	Scott Bleustein	 
	 	 	Title:  	Authorized Signatory 	 
	 

	 	 	 	 	 
	AGREED AND ACKNOWLEDGED:

LAURUS MASTER FUND, LTD.

By: Laurus Capital Management, LLC, its investment manager

 	 
	By:  	/s/
Scott Bleustein	 
	 	Name:  	Scott Bleustein	 
	 	Title:  	Authorized Signatory 	 

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EXHIBIT A

[DESIGNATED DEFAULTS]

The Events of Default that may have arisen solely as a result of the failure of the Companies to,
on or prior to November 16, 2007, deliver to Laurus copies of a second asset purchase agreement,
duly authorized and executed by each of the parties thereto (the “Second PA”), as required under
the terms and conditions set forth in the Overadvance Side Letter, dated as of October 10, 2007 by
and among the Companies, certain other former Subsidiaries of the Parent and Laurus.

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EXHIBIT B

APPROVED BUDGET

[Form attached to Term Sheet to be attached]

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EXHIBIT 10.54

SEPARATION AGREEMENT AND RELEASE

     This Separation Agreement and Release (this Agreement”) is entered into between John Lettko
and Proxymed, Inc., dba MedAvant Healthcare, effective February 27, 2008 (the “Effective Date”).
In this Agreement “Employee” refers to John Lettko and “the Company” refers to Proxymed, Inc. The
Employee enters into this Agreement on behalf of himself, and his spouse, heirs, successors,
assigns, executors, and representatives of any kind, if any. In consideration of the terms,
conditions, and provisions contained in this Agreement, the Employee and the Company agree and
acknowledge as follows:

     1. Termination. Effective as of February 28, 2008 (the “Termination Date”), the
Employment Agreement between the parties is hereby terminated and of no further force or effect.
Employee, by his execution of this Agreement, hereby resigns as the Chief Executive Officer and
Director of the Company and any of the Company’s affiliated or subsidiary entities.

     2. Accrued Vacation; Business Expenses. On the Termination Date, the Company will pay
Employee accrued Vacation/Paid Time Off in the amount of $55,654.04. In addition, Company will pay
Employee all reimbursable business expenses that are outstanding.

     3. Severance.

          a. The Company agrees to pay Employee as severance compensation the gross amount of Two
Hundred Ten Thousand Dollars and No Cents ($210,000), minus taxes and withholdings. This severance
pay will be paid in equal installments over a six (6) month period, pursuant to the Company’s
normal payroll schedule. The first installment of this severance pay shall be sent to Employee on
the next regular payroll day that occurs after Foley & Lardner has received an original of this
Agreement that has been signed and dated by Employee.

          b. If Employee timely elects, pursuant to “COBRA,” to continue participation in any applicable
group medical or dental plan in which he is currently enrolled, the Company will pay the normal
employer share of the monthly premium for Employee’s current coverage, on behalf of Employee, for
the first 6 months of such COBRA continuation. After this 6 month period, any further
participation in the Company’s group medical and dental plan pursuant to COBRA will be at the
expense of Employee and will be governed by the applicable plan provisions and the provisions of
COBRA. Employee hereby authorizes the Company to deduct the normal employee share of the premium
from his severance payments. However, the payment by the Company of the employee share of the
monthly premium pursuant to this paragraph will not begin unless and until the revocation period
contained in this Agreement has expired without revocation by Employee.

          c. Employee and Company each acknowledge that the benefits provided hereunder are different
than those set forth in the Termination section 5 of the May 10, 2005 Employment Agreement between
them. This Agreement is the result of Employee and Company negotiating a mutually agreed upon
compromise of potentially disputed benefit levels that could have been asserted by Employee or
Company under the terms of the Employment Agreement.

     4. References. Any employment references requested by a third party and approved by
Employee will be directed to the Chairman of the Board, Jim Hudak.

     5. Public Announcement. The parties will jointly prepare a public announcement
regarding Employee’s termination, to be released no later than four (4) days after the Termination
Date.

     6. Employee Release. Employee releases the Company and the Released Parties (as
defined below) from all claims or rights of any kind arising before or through the date Employee
signs this Agreement. This release of all claims includes, but is not limited to, all claims, or
rights arising out of or in connection with Employee’s employment with the Company or the
termination of that employment. Employee also releases and waives any claim or right to further
wages, compensation, benefits, damages, penalties, attorneys’ fees, costs, or expenses of any kind
from the Company or any of the other Released Parties. Employee fully understands and acknowledges
that the general release of all claims contained in this paragraph means that Employee is forever
giving up and waiving all claims and rights Employee may have against the Company or any of the
other Released Parties based on any conduct that occurred on or before the date Employee signs this
Agreement.

          a. The term “Released Parties” includes the Company and the Company’s past and present
employees, officers, agents, insurers, attorneys, shareholders, successors, executors and
representatives of any kind. The term “Released Parties” also includes the Company’s subsidiaries
and affiliates and their past and present employees, officers, agents, insurers, attorneys,
shareholders, successors, executors and representatives of any kind. The term “Released Parties”
also includes all current directors of the Company and all current directors of any subsidiary and
affiliate of the Company.

          b. Employee fully understands and acknowledges that the general release contained above
includes, but is not limited to, a release of any rights or claims Employee may have under any of
the following laws: the Age Discrimination in Employment Act; Title VII of the Civil Rights Act of
1964; the Americans with Disabilities Act; the California Fair Employment and Housing Act; the
Reconstruction Era Civil Rights Acts; Executive Order

 

 

11246; the Rehabilitation Act of 1973; the Civil Rights Act of 1991; any other employment
discrimination laws; the Employee Retirement Income Security Act of 1974; state and federal family
and medical leave laws; state and federal discrimination laws; any laws that provide for payment of
attorneys’ fees, costs, expenses or punitive, exemplary or statutory damages; and any other
federal, state, or local laws or regulations of any kind. The general release contained in this
Agreement also includes, but is not limited to, a release by Employee of any claims for wrongful
termination or any tort, breach of contract, defamation, public policy or invasion of privacy
claims. The release also includes a release of any claims arising out of any Company policy,
practice, contract or agreement. The release covers both claims that Employee knows about and
those he does not know about.

          c. Not withstanding any provision herein, all obligations to provide a defense and/or
indemnification to employee pursuant to the May 10, 2005 Indemnification Agreement between Company
and Employee, the Articles and By-Laws of the Company, or any statute, including but not limited to
California Labor Code section 2802, shall remain in full force and effect. Nothing contained
herein shall be interpreted to impact the obligations of the Company with regard to Directors and
Officers Liability insurance coverages.

     7. Company Release. In return for the promises set forth herein, the Company, on its
own behalf, and on behalf of its successors and assigns (collectively, the “Company Releasors”),
hereby agrees to release and forever discharge by this Agreement, Employee and each of his
grantees, agents, representatives, heirs, devisees, trustees, assigns, assignors, attorneys, or any
other entities in which he has an interest (collectively, the “Lettko Releasees”), from all
liabilities, causes of actions, charges, complaints, suits, claims, obligations, costs, losses,
damages, rights, judgments, attorneys’ fees, expenses, bonds,
bills, penalties, fines, and all other legal responsibilities of any form whatsoever, whether known or unknown, whether
suspected or unsuspected, whether fixed or contingent, including but not limited to those arising
from (i) his employment with, compensation by and/or separation from the Company; and (ii) any acts
or omissions occurring prior to the Effective Date by the Lettko Releasees, including those arising
under any theory of law, whether common, constitutional, statutory or other of any jurisdiction,
foreign or domestic, whether known or unknown, whether in law or in equity, which they had or may
claim to have against any of the Lettko Releasees.

          a. The Company’s Release in this section, and the Company’s Waiver in Section 9 below, do not
apply to a judgment by a court of competent jurisdiction or other final adjudication of a violation
of criminal law by Employee, unless Employee had reasonable cause to believe his conduct was
lawful.

     8. Waiver. Except as provided in Sections 7(c), 7(d), and 8(a) above, Employee and
the Company understand and agree that all of their rights under California Civil Code Section 1542
are expressly waived. Section 1542 provides as follows:

A general release does not extend to claims that a creditor does not know
or suspect to exist in his favor at the time of executing the release, which if
known by him, must have materially affected his settlement with the debtor.

     Employee and the Company understand that by waiving their rights under Civil Code Section 1542
means that even if they should eventually suffer some damage arising out of Employee’s employment
and/or termination of employment with the Company, they will not be able to make any claims for
those damages, even as to claims which may now exist, but which they do not know exist, and which
if known would have affected their decision to sign this Agreement.

     9. Confidentiality; Use of Trade Secrets. During his employment with the Company,
Employee had access to the Company’s trade secrets and proprietary information, including but not
limited to, the Company’s products, services, research and development of new products and
services, customers, methods of doing business, financial data, marketing plans and sales
techniques, in each case that has or could have value to the Company, which if disclosed could be
detrimental to the Company, and which the Company has taken reasonable steps to prevent from
disclosure to the general public. “Proprietary Information” as used herein shall mean all such
information that is protected in accordance with the Uniform Trade Secrets Act, codified at
California Civil Code section 3426, et. seq,

          a. Employee agrees that he will not use, disclose or reveal to any third party any such
Proprietary Information.

          b. Employee agrees that he has returned all confidential or Proprietary Information,
documents, materials, apparatus, equipment, other physical property or the reproduction of any such
property to the Company.

          c. Employee recognizes that the unauthorized use or disclosure of the Proprietary Information
is unlawful and that the Company may obtain damages or seek injunctive relief against him for any
willful misappropriation of same, including but not limited to treble damages and attorney fees
under the Uniform Trade Secrets Act.

     10. Non-Solicitation; Non-Circumvention. Employee will not: (i) for a period of one
year following the termination date herein solicit any current employee of Company to leave the
employ of Company or (ii) use any Proprietary Information to unlawfully interfere with any of the
Company’s business relationships, including, without limitation, those with

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customers, clients, suppliers, consultants, attorneys, accountants and other agents, whether
or not evidenced by written or oral agreements.

     11. Vested Benefits.

          a. Employee understands that this Agreement in no way affects any vested rights Employee may
have, if any, under the Company’s 401(k) plan or pension plan. Employee understands and
acknowledges that Employee’s eligibility for any and all other benefits of employment ceased as of
Employee’s Termination Date.

          b. Company recognizes that Employee has received certain vested stock options in accordance
with the terms of the May 10, 2005 Employment Agreement and related Stock Option Agreement. The
latest exercise date of all such options shall be eighteen (18) months following the termination
date referenced above, in accordance with Section 3(c) of the Employment Agreement.

     12. Register of Stock. Until such time as all the shares of common stock of the
Company held by Employee are eligible for resale pursuant to Rule 144(k) promulgated under the
Securities Act of 1933, as amended, if the Company files a registration statement with the
Securities Exchange Commission (other than on Form S-8 or Form S-4) for the sale or resale of
common stock, the Company shall include Employee’s shares in such registration, subject to a
cutback of the number of Employee’s shares included in such registration should an underwriter of
the offering that is the subject of such registration request such cutback.

     13. No Admission. Neither the Company’s nor Employee’s signing of this Agreement, nor
any actions taken by either party toward compliance with the terms of this Agreement constitutes an
admission that either party acted improperly or unlawfully toward each other or violated any state
or federal law.

     14. Reemployment. Employee agrees that Employee is not entitled to, and gives up any
right to, reinstatement or reemployment with the Company, and he will not at any time after signing
of this Agreement apply for a position (as an employee, independent contractor or through an
employment agency) with the Company or any of its parent, subsidiary or affiliated companies.

     15. Attorney’s Fees and Costs. Employee and Company understand and agree that if
either party violates any of the provisions of this Agreement, the prevailing party will be
entitled to reimbursement from the other party for actual attorneys’ fees and costs incurred in
either enforcing this Agreement or in defending against a claim released by the other party in
this Agreement. This obligation to pay the Company’s attorneys’ fees and costs would not apply to
an action by Employee challenging the validity of this Agreement under the Age Discrimination in
Employment Act.

     16. No Other Claims or Action. Employee agrees not to (and did not already) file or
join in any complaints, lawsuits, or proceedings of any kind against the Company or any of the
other Released Parties, with the exception of the following: (a) nothing in this Agreement
prevents Employee from making a claim for unemployment compensation benefits; (b) while this
Agreement does not prevent Employee from filing a charge with the EEOC or the DFEH or otherwise
cooperating with the EEOC or the DFEH, this Agreement does prohibit Employee from obtaining any
personal or monetary relief for himself based on such a charge or such cooperation. This Agreement
also prohibits Employee from obtaining any personal or monetary relief for himself or herself in
any lawsuit in court or in any other proceeding of any kind instituted by Employee or by anyone
else on behalf of Employee.

     17. Company Property. Employee agrees to return all tangible Company property to the
Company including all documents, reports, credit cards, computer equipment, phones, identification
cards and papers, if any are still in his possession. Employee further represents that he has
returned all other property and information belonging to the Company, including, but not limited
to, all confidential business information, technical and product information, pricing information
and customer information such as customer lists and customer identification information, brochures,
specifications, quotations, marketing strategies, inventory records, sales records, or other
similar material. Employee acknowledges that he has not kept any copies, nor made or retained any
abstracts or notes of such information.

     18. Non-Disparagement. Employee agrees that he will not in any way disparage, defame
or otherwise cause to be published or disseminated, whether verbally or in writing, any negative or
critical statements, remarks, comments or information regarding the Company or the Releasees,
including, without limitation, any statement, remark or comment related to their respective
businesses, reputation, products, practices, services or conduct. In addition, Employee will not
make any public statements regarding the Company, without the prior written approval of the
Chairman of the Board of Directors Jim Hudak. The Company agrees that it will not in any way
disparage, defame or otherwise cause to be published or disseminated, whether verbally or in
writing, any negative or critical statements, remarks, comments or information regarding Employee.

     19. Miscellaneous.

          a. This Agreement constitutes the full, complete, unconditional, and immediate substitution
for any and all rights, claims, demands, and causes of actions whatsoever, which heretofore existed
or might have existed on behalf of any party against any other party and

3

 

their successors, predecessors, subsidiaries, affiliates, parents, stockholders, partners,
employees, agents, officers, and directors. Except as otherwise specified herein, this Agreement
supersedes any and all agreements—whether written or oral—that may have previously existed between
the parties. No statements, promises, or representations have been made by any party to any other,
or relied upon, and no consideration has been offered, promised, expected, or held out other than
as may be expressly provided herein.

          b. In the event of Employee’s death, the rights described in this Agreement shall pass by will
or by the laws of descent or distribution. This Agreement shall be binding upon the parties
hereto, as well as upon all representatives, assigns, successors, heirs, affiliates and agents of
the parties.

          c. The parties hereto each represent and warrant to the other party that except to the extent
otherwise provided herein, that they have not assigned or transferred to any third party any of the
rights, claims, causes of action or items to be released or transferred which they are obligated to
transfer or to release as part of this Agreement.

          d. The provisions of this Agreement may not be waived, altered, amended or repealed, in whole
or in part, except upon the prior written consent of the parties hereto.

          e. This Agreement shall be construed and enforced in accordance with, and governed by, the
laws of the State of California, without regard to choice of law principles. Except for actions
seeking injunctive relief (which may be brought in any appropriate jurisdiction) suit under this
Agreement shall only be brought in a court of competent jurisdiction in Orange County, State of
California. This choice of venue is intended by the parties to be mandatory and not permissive in
nature, and to preclude the possibility of litigation between the parties with respect to, or arising out of, this Agreement in any jurisdiction other than that
specified in this Section. Each party waives any right it may have to assert the doctrine of forum
non conveniens or similar doctrine or to object to venue with respect to any proceeding brought in
accordance with this Section.

          f. Each party agrees to perform any further acts and execute and deliver any further documents
that may be reasonably necessary to carry out the provisions of this Agreement.

          g. Each party has cooperated in the drafting and preparation of this Agreement. In any
construction to be made of this Agreement or of any of its terms and provisions, the same shall not
be construed against any party.

          h. If any portion of this Agreement is found to be illegal, invalid or unenforceable,
Employee, the Company and the other Released Parties desire that all other portions that can be
separated from it or appropriately limited in scope shall remain fully valid, legal and
enforceable.

          i. The parties acknowledge and agree that they have been represented by independent counsel in
the negotiation, preparation and execution of this Agreement and that each of them have read this
Agreement and has had it fully explained by his, or its counsel prior to its execution and is fully
aware of its contents and legal effect.

          j. Each party represents that it is authorized to execute this Agreement. Each person
executing this Agreement on behalf of a person or entity represents that he or she is authorized to
execute this Agreement on behalf of said entity.

          k. This Agreement may be executed in counterparts, each of which shall be considered an
original, but all of which shall constitute one and the same
document. The parties agree that the delivery of this Agreement by facsimile transmission or electronic
delivery via PDF shall have the same force and effect as delivery of original signatures and that
each party may use such facsimile or PDF as evidence of the execution and delivery of this
Agreement by all parties to the same extent that the original signature could be used.

     20. This Agreement shall be deemed effective as of the Effective Date.

     EMPLOYEE CERTIFIES AS FOLLOWS: I HAVE READ THIS AGREEMENT, UNDERSTAND IT, KNOW IT CONTAINS A
GENERAL RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS OF ANY KIND AGAINST THE COMPANY OR ANY OF THE OTHER
RELEASED PARTIES, AND I AM VOLUNTARILY ENTERING INTO IT.

	 	 	 
	/s/ John Lettko

	 	2/28/2008
	 

	 	 
	John Lettko

	 	Date
	 
	 	 
	APPROVED:
	 	 
	 
	 	 
	/s/ James Brown 2-28-08
	 	 
	 	 
	 
	James Brown, Esq.
	 	 
	Attorney for Employee
	 	 
	 
	 	 
	Proxymed, Inc.
	 	 
	 
	 	 
	/s/ Jim Hudak

	 	2/28/2008
	 

	 	 
	By: Jim Hudak

	 	Date
	Chairman of the Board of Directors
	 	 

4

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