Document:

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                                                                    EXHIBIT 10.1

                 SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE

         This Settlement Agreement and Mutual General Release ("Agreement") is
made and entered into this 2nd day of December, 2002 (the "Effective Date") by
and among SurgiCare, Inc. ("SurgiCare"), Thomas Yerden ("Yerden") and TLC
Capital Corporation ("TLC"), in consideration of the money, promises, covenants
and mutual releases exchanged herein.

         WHEREAS, SurgiCare, Yerden and TLC previously entered into a Stock
Purchase Agreement dated May 16, 2002 (the "SPA"), whereby SurgiCare agreed,
inter alia, to purchase from Yerden and TLC (Yerden and TLC are collectively
referred to herein as "Seller") all of the shares of stock of Aspen Healthcare,
Inc. ("Aspen");

         WHEREAS, pursuant to the terms of the SPA, the closing of the sale of
such stock of Aspen was to occur on May 30, 2002;

         WHEREAS, as SurgiCare did not meet certain obligations under the SPA,
including its obligation to deliver the purchase price as required by Section
2A(iii) of the SPA, the Closing did not occur on May 30, 2002;

         WHEREAS, SurgiCare and Seller amended the SPA on June 14, 2002 (the
"First Amendment") whereby the parties agreed, inter alia: (1) upon a new
closing date of either August 6, 2002 or, at the latest, September 14, 2002, and
(2) that Seller reserved its rights relating to any claims that it had against
SurgiCare for its failure to consummate the transactions set forth in the SPA;

         WHEREAS, SurgiCare again failed to meets its obligations to deliver the
purchase price by the new closing dates set forth in the First Amendment; and

         WHEREAS, SurgiCare and Seller desire to settle and resolve their
differences, including, but not limited to, all matters pertaining to
SurgiCare's failure to consummate the transactions

<PAGE>
mentioned above, as well as any claims that SurgiCare and Seller have or may
have against or with respect to each other, on the terms and conditions set
forth herein.

         IT IS THEREFORE AGREED:

         1.       PAYMENTS BY SURGICARE

         In exchange and in consideration for the releases, promises and
covenants of Seller contained herein, SurgiCare agrees as follows:

                  (a)      Seller shall retain all amounts designated by the SPA
                           and First Amendment as "Non-Refundable", with Seller
                           having no obligation to return any amounts or items
                           previously paid or transferred to Seller by SurgiCare
                           except as provided herein;

                  (b)      Upon the Effective Date, SurgiCare shall pay to
                           Yerden $24,000 by certified check or wire transfer
                           payable to Thomas Yerden, and to TLC $76,000 by
                           certified check or wire transfer payable to TLC
                           Capital Corporation;

                  (c)      Upon the Effective Date, SurgiCare will purchase for
                           $2.24 per share the 75,000 shares of common stock of
                           SurgiCare previously provided to Yerden. Payment will
                           be made to Yerden upon the Effective Date by
                           SurgiCare's delivery by certified checks or wire
                           transfer to Yerden in the amount of$168,000;

                  (d)      If TLC, within 30 days of the Effective date,
                           delivers to SurgiCare 16,400 shares of SurgiCare
                           stock, SurgiCare will, within 5 days of delivery of
                           such stock, deliver to TLC the amount of $36,736 by
                           certified check or wire transfer payable to TLC
                           Capital Corporation;

                  (e)      Upon the Effective Date, SurgiCare agrees to amend
                           the 32,829 warrants for shares of common stock of
                           SurgiCare previously provided to Yerden and the
                           103,957 warrants for shares of common stock of
                           SurgiCare previously provided to TLC (collectively,
                           the "Original Warrants") by executing the amendments
                           attached hereto as Exhibits A and B;

                  (f)      Upon the Effective Date, SurgiCare will provide
                           Seller a total of 200,000 warrants for shares of
                           common stock of SurgiCare by executing the warrants
                           attached hereto as Exhibits C and D, with 48,000 of
                           said warrants to be delivered to Yerden and 152,000
                           of said warrants to he delivered to TLC
                           (collectively, the "Settlement Warrants"); and

                  (g)      The parties acknowledge and agree that any shares of
                           SurgiCare Common Stock issued to either TLC or Yerden
                           upon the exercise of any of the

                                   Page 2 of 7

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                           Original Warrants or the Settlement Warrants shall be
                           subject to the restrictions of Rule 144 promulgated
                           under the Securities Act of 1933, as amended,
                           provided, SurgiCare shall have delivered an opinion
                           of counsel which states that the holding period for
                           Rule 144 purposes for the issuance of SurgiCare
                           Common Stock underlying the Original Warrants shall
                           be deemed to begin on May 16, 2002. SurgiCare hereby
                           covenants and agrees that if it files a registration
                           statement with the United States Securities and
                           Exchange Commission to register the issuance of any
                           shares or other securities, it shall register, on
                           behalf of Yerden and TLC, that number of shares of
                           SurgiCare Common Stock issuable upon exercise of the
                           Original Warrants and the Settlement Warrants in
                           accordance with the registration representations,
                           warranties and covenants set forth in the
                           Registration Rights Agreements attached as Exhibits E
                           and F hereto. SurgiCare further expressly
                           acknowledges and agrees all terms set forth in
                           Exhibit E and Exhibit F, including all duties,
                           obligations and covenants therein.

         2.       MUTUAL RELEASES

                  (a)      SurgiCare, on behalf of itself, its related entities,
                           parent companies, officers, employees, directors,
                           shareholders, creditors, agents, representatives,
                           attorneys, assigns, predecessors and successors
                           (hereinafter collectively referred to as the
                           "SurgiCare-Parties"), hereby: (i) release and forever
                           discharge each of Yerden and TLC, and their
                           respective related entities, parent companies,
                           officers, employees, directors, shareholders, agents,
                           representatives, attorneys, assigns predecessors,
                           successors, heirs, executors, and administrators
                           (hereinafter collectively referred to as the
                           "Seller-Parties"), from any and all demands,
                           obligations, agreements, promises, representations,
                           damages, suits, liabilities, causes of action,
                           remedies, or claims of any type the SurgiCare-Parties
                           now have, or ever have had, as of the date hereof or
                           at any time prior to the date hereof, including, but
                           not limited to, all claims arising (or which could
                           have arisen) out of the SPA, First Amendment, and all
                           negotiations and business dealings relating to those
                           agreements and this Agreement, as well as those
                           arising under any federal, state or local statute and
                           all claims or actions arising under the common law of
                           any state; and (ii) covenant and agree never to
                           institute directly or indirectly any action of any
                           type for any demands, obligations, agreements,
                           promises, representations, damages, suits,
                           liabilities, causes of action, remedies, or claims of
                           any type that the SurgiCare-Parties now have, or ever
                           have had, as of the date hereof or at any time prior
                           to the date hereof, including, but not limited to,
                           all claims arising (or which could have arisen) out
                           of the SPA, First Amendment, and all negotiations and
                           business dealings relating to those agreements and
                           this Agreement, as well as those arising under any
                           federal, state or local statute and all claims or
                           actions arising under the common law of any state,
                           against any of the Seller-Parties.

                                   Page 3 of 7

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                  (b)      Subject to Section 7 herein, Seller hereby: (i)
                           releases and forever discharges the SurgiCare-Parties
                           from any and all demands, obligations, agreements,
                           promises, representations, damages, suits,
                           liabilities, causes of action, remedies, or claims of
                           any type Seller now has, or ever has had, as of the
                           date hereof or at any time prior to the date hereof,
                           including, but not limited to, all claims arising (or
                           which could have arisen) out of the SPA, First
                           Amendment, and all negotiations and business dealings
                           relating to those agreements and this Agreement, as
                           well as those arising under any federal, state or
                           local statute and all claims or actions arising under
                           the common law of any state; and (ii) covenants and
                           agrees never to institute directly or indirectly any
                           action of any type for any demands, obligations,
                           agreements, promises, representations, damages,
                           suits, liabilities, causes of action, remedies, or
                           claims of any type Seller now has, or ever has had,
                           as of the date hereof or at any time prior to the
                           date hereof, including, but not limited to, all
                           claims arising (or which could have arisen) out of
                           the SPA, First Amendment, and all negotiations and
                           business dealings relating to those agreements and
                           this Agreement, as well as those arising under any
                           federal, state or local statute and all claims or
                           actions arising under the common law of any state,
                           against any of the SurgiCare-Parties.

         3.       INDEMNIFICATION BY SURGICARE

         SurgiCare agrees to unconditionally indemnify and hold each of the
Seller-Parties harmless from and against any claim, loss, damage, demand,
deficiency, expense, liability, suit or judgment (including reasonable
attorney's fees and costs of defense or investigation related thereto) which
arises out of or relates to the SPA, the First Amendment, this Agreement or the
any of the Exhibits to this Agreement, as well as any negotiations and business
dealings relating to those agreements. Without limiting the generality of the
foregoing, SurgiCare explicitly agrees that its obligation to indemnify under
this provision will apply to any claims brought by its former or current
shareholders, officers, board members or executives, by any governmental agency,
or by its creditors or successors, and that SurgiCare will fully defend and
indemnify and hold each Seller-Party harmless from and against any and all
actions or claims (including without limitation any and all expenses, costs or
fees related to defending against such claims and actions, and any and all
penalties and damages relating to any such claims and actions) brought by any of
such parties.

                                   Page 4 of 7

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         4.       NO PRIOR ASSIGNMENT

         SurgiCare and Seller each represent and warrant to the other that they
have not assigned any of the demands, obligations, agreements, promises,
representations, damages, suits, liabilities, causes of action, remedies, or
claims of any type described in Section 2 above and have not authorized any
other person or entity to assert any such demands, obligations, agreements,
promises, representations, damages, suits, liabilities, causes of action,
remedies, or claims of any type on their behalf.

         5.       TERMINATION

         SurgiCare and Seller agree that the SPA and First Amendment are
terminated in their entirety and, with the exception of the obligations to one
another hereunder, neither party shall have any further obligations whatsoever
to the other, except as provided under Section 7 herein.

         6.       AGREEMENT BINDING UPON SUCCESSORS

         This Agreement shall be binding upon and inure to the benefit of
SurgiCare and Seller, as well as their respective representatives, predecessors,
successors, creditors and assigns.

         7.       BREACH BY SURGICARE

         In the event that SurgiCare breaches any of its obligations under this
Agreement or any related agreements delivered in connection herewith (including
but not limited to those contained in Section 1 above and in any Exhibits
attached hereto), or if SurgiCare brings any action, suit, claim or
counterclaim of any type against any of the Seller-Parties, the Seller-Parties
shall not be bound by the releases contained herein and may pursue any claims
they have against SurgiCare, including those relating to the SPA and First
Amendment. In any such claims, the Seller-Parties may pursue any and all damages
they may have relating to SurgiCare's breaches of the SPA and First Amendment
and will not be limited to the compromise amounts contained herein.

                                   Page 5 of 7

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Specifically, SurgiCare agrees and acknowledges that Sellers' damages resulting
from SurgiCare's breaches of the SPA and First Amendment exceed $1,000,000. This
provision provides for the discontinuance of only Seller's obligations under
Section 2(b) herein upon the events specified in this Section 7, and shall not
be construed to effect the remaining provisions of this Agreement or require
Seller to return any amounts paid to Seller pursuant to this Agreement.

         8.       FORUM SELECTION AND ATTORNEY'S FEES TO SELLER

         Any claim brought by any of the SurgiCare-Parties against any of the
Seller-Parties must be brought in state or federal court in Denver, Colorado,
which shall be the sole and exclusive forum for any and all such disputes.
Moreover, if any of the Seller-Parties are the prevailing party in any such
dispute, they shall be entitled to their attorney's fees and costs.

         9.       NONDISPARAGEMENT

         SurgiCare agrees that they will not communicate in any manner (whether
written, orally, electronically or otherwise) any statements concerning Seller
or Aspen which are disparaging in nature, including but not limited to any
statements indicating that SurgiCare's failure to purchase the stock of Aspen
was due to any actions or condition of Aspen.

         10.      APPLICABLE LAW

         This Agreement shall be governed by and construed in accordance with
the laws of Delaware, without giving effect to any rules, principles or
provisions of choice of law or conflict of laws.

         11.      COUNTERPARTS

         This Agreement may be executed in one or more counterparts, each of
which shall be an original and all of which shall be deemed a completed
instrument.

                                   Page 6 of 7

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         12.      REPRESENTATION BY COUNSEL

         Both parties agree and acknowledge that they have consulted with their
respective legal counsel regarding this Agreement and the matters referenced
herein, and that they knowingly and willfully enter into this Agreement and
intend to be bound by same.

         13.      CAPTIONS

         Captions contained in this Agreement are for convenience only, and
shall have no legal or binding effect.

         14.      ENTIRE AGREEMENT

         This Agreement constitutes and contains the entire agreement and
understanding between SurgiCare and Seller concerning the subject matter of this
Agreement, and supersedes all prior negotiations, proposed agreements, and
understandings, if any, between each other.

         IN WITNESS WHEREOF, the parties have executed this Settlement Agreement
and Mutual General Release as of the date first written above.

                                          SURGICARE, INC.

                                          By:  /s/ KENT LEBLANC
                                              ---------------------------------
                                          Name:  Kent Leblanc
                                               --------------------------------
                                          Title: CEO
                                                 ------------------------------

                                          THOMAS YERDEN

                                          /s/ THOMAS YERDEN
                                          -------------------------------------

                                          TLC CAPITAL CORPORATION

                                          By:  /s/ ROBERT W. MAY
                                              ---------------------------------
                                          Name: Robert W. May
                                               --------------------------------
                                          Title: Secretary
                                                 ------------------------------

                                   Page 7 of 7

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                                    EXHIBIT A

                      FIRST AMENDMENT TO WARRANT AGREEMENT

         This First Amendment (the "First Amendment") to the Warrant Agreement
(the "Warrant") by SurgiCare, Inc., a Delaware corporation (the "Company"), in
favor of TLC Capital Corporation (the "Holder") is entered into as of the 2nd
day of December, 2002, by and between the Company and the Holder.

         WHEREAS, in connection with, and in consideration of the terms and
conditions of, that certain Stock Purchase Agreement entered into by and among
the Company, the Holder and Thomas Yerden ("Yerden"), dated May 16, 2002, the
Company and the Holder entered into the Warrant pursuant to which the Holder is
entitled to purchase 103,957 "Shares" (as defined in the Warrant); and

         WHEREAS, in connection with, and in consideration of the terms and
conditions of, that certain Settlement Agreement entered into by and among the
Company, the Holder and Yerden, dated December 2, 2002 (the "Settlement
Agreement"), the Company and the Holder desire to amend certain terms of the
Warrant.

         NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
and agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

1.       Exercise of Warrants.

         a.       Section 1(a) of the Warrant is hereby amended by deleting the
                  phrase "as promptly as practicable" and inserting the phrase
                  "within five (5) days" in its place.

         b.       Section 1(b) of the Warrant is deleted in its entirety and
                  replaced with the following:

                  (b) This Warrant may be exercised, as to any shares of Common
                  Stock pursuant to this Warrant Agreement, at a price of $0.32
                  per share (the "Exercise Price"). Holder shall have the right
                  to purchase 103,957 Shares of Common Stock underlying this
                  Warrant Agreement beginning December 2, 2002. The Warrant
                  shall expire upon the close of business December 2, 2007.

         c.       Section 1(c) of the Warrant is hereby amended by inserting the
                  word "Shares" immediately before the word "determined."

2.       Shares Underlying Warrants. Section 4 of the Warrant is hereby amended
         by adding the following phrase immediately before the period at the end
         of the section, ", with transferability subject to compliance with
         applicable securities laws."

3.       Disposition of Warrants or Shares. Section 5 of the Warrant is hereby
         deleted in its entirety and replaced with the following:

<PAGE>
         5.       Disposition of Warrants of Shares. It shall be a condition to
                  the transfer of this Warrant that any transferee of this
                  Warrant deliver to the Company his/its written agreement to
                  accept and be bound by all of the terms and conditions of this
                  Warrant Agreement, as amended.

4.       Effective Date. This First Amendment shall become effective as of the
         day and year first above written (the "Effective Date").

5.       Reaffirmation. Except for the amendments set forth herein, the Warrant
         shall continue to be in full force and effect in accordance with the
         terms and conditions therein, and the Warrant is hereby ratified and
         affirmed. After the Effective Date, each reference to the Warrant in
         any other instrument or document shall be deemed a reference to the
         Warrant as amended hereby, unless the context otherwise requires.

6.       No Waiver. Neither the execution, delivery or performance of this First
         Amendment shall operate as a waiver of any right, power or remedy
         exercisable by any party hereto in accordance with the Warrant.

7.       Governing Law. This First Amendment shall be governed by and construed
         in accordance with the laws of Delaware, without reference to its
         conflict of law principles.

         IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment or have caused this First Amendment to be duly executed by its duly
authorized representative as of the day and year first written above.

                                              SURGICARE, INC.

                                              By: /s/ KEITH LEBLANC
                                                  -----------------------------
                                              Title: CEO
                                                     --------------------------

                                              HOLDER:

                                              TLC CAPITAL CORPORATION

                                          By:  /s/ ROBERT W. MAY
                                              ---------------------------------
                                          Title: Secretary
                                                 ------------------------------

                                       -2-

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                                    EXHIBIT B

                      FIRST AMENDMENT TO WARRANT AGREEMENT

         This First Amendment (the "First Amendment") to the Warrant Agreement
(the "Warrant") by SurgiCare, Inc., a Delaware corporation (the "Company"), in
favor of Thomas Yerden (the "Holder") is entered into as of the 2nd day of
December, 2002, by and between the Company and the Holder.

         WHEREAS, in connection with, and in consideration of the terms and
conditions of, that certain Stock Purchase Agreement entered into by and among
the Company, the Holder and TLC Capital Corporation ("TLC"), dated May 16, 2002,
the Company and the Holder entered into the Warrant pursuant to which the Holder
is entitled to purchase 32,829 "Shares" (as defined in the Warrant); and

         WHEREAS, in connection with, and in consideration of the terms and
conditions of, that certain Settlement Agreement entered into by and among the
Company, the Holder and TLC, dated December 2, 2002 (the "Settlement
Agreement"), the Company and the Holder desire to amend certain terms of the
Warrant.

         NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
and agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

1.       Exercise of Warrants.

         a.       Section 1(a) of the Warrant is hereby amended by deleting the
                  phrase "as promptly as practicable" and inserting the phrase
                  "within five (5) days" in its place.

         b.       Section 1(b) of the Warrant is deleted in its entirety and
                  replaced with the following:

                  (b) This Warrant may be exercised, as to any shares of Common
                  Stock pursuant to this Warrant Agreement, at a price of $0.32
                  per share (the "Exercise Price"). Holder shall have the right
                  to purchase 32,829 Shares of Common Stock underlying this
                  Warrant Agreement beginning December 2, 2002. The Warrant
                  shall expire upon the close of business December 2, 2007.

         c.       Section 1(c) of the Warrant is hereby amended by inserting the
                  word "Shares" immediately before the word "determined."

2.       Shares Underlying Warrants. Section 4 of the Warrant is hereby amended
         by adding the following phrase immediately before the period at the end
         of the section, ", with transferability subject to compliance with
         applicable securities laws."

3.       Disposition of Warrants or Shares. Section 5 of the Warrant is hereby
         deleted in its entirety and replaced with the following:

<PAGE>

         5.       Disposition of Warrants of Shares. It shall be a condition to
                  the transfer of this Warrant that any transferee of this
                  Warrant deliver to the Company his/its written agreement to
                  accept and be bound by all of the terms and conditions of this
                  Warrant Agreement, as amended.

4.       Effective Date. This First Amendment shall become effective as of the
         day and year first above written (the "Effective Date").

5.       Reaffirmation. Except for the amendments set forth herein, the Warrant
         shall continue to be in full force and effect in accordance with the
         terms and conditions therein, and the Warrant is hereby ratified and
         affirmed. After the Effective Date, each reference to the Warrant in
         any other instrument or document shall be deemed a reference to the
         Warrant as amended hereby, unless the context otherwise requires.

6.       No Waiver. Neither the execution, delivery or performance of this First
         Amendment shall operate as a waiver of any right, power or remedy
         exercisable by any party hereto in accordance with the Warrant.

7.       Governing Law. This First Amendment shall be governed by and construed
         in accordance with the laws of Delaware, without reference to its
         conflict of law principles.

         IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment or have caused this First Amendment to be duly executed by its duly
authorized representative as of the day and year first written above.

                                            SURGICARE, TNC.

                                            By: /s/ KEITH LEBLANC
                                                -----------------------------
                                            Title: CEO
                                                   --------------------------

                                            HOLDER:

                                            /s/ THOMAS YERDEN
                                            -----------------------------------
                                                      Thomas Yerden
                                            Address:  603 5. Broadway, Suite B
                                                      Boulder, Colorado 80305

                                       -2-

<PAGE>

                                    EXHIBIT C

                                WARRANT AGREEMENT

               WARRANT TO PURCHASE 152,000 SHARES OF COMMON STOCK

                                 SURGICARE, INC.
                            (a Delaware corporation)
                         12727 Kimberley Lane, Suite 200
                              Houston, Texas 77024

                             Not Exercisable Except
                        upon Conditions Herein Specified

         SURGICARE, INC., a Delaware corporation ("Company"), hereby certifies
that TLC CAPITAL CORPORATION, its registered successors and permitted assigns
registered on the books of the Company maintained for such purposes, as the
registered holder hereof ("Holder"), for value received in connection with that
certain Settlement Agreement by and between the Company, Holder and Thomas
Yerden, dated December 2, 2002 (the "Settlement Agreement"), is entitled to
purchase from the Company the number of fully paid and non-assessable shares of
Common Stock of the Company, $.005 par value ("Shares" or "Common Stock"),
stated above at the purchase price per Share set forth in Section 1(b) below
(the number of Shares and Exercise Price being subject to adjustment as
hereinafter provided) upon the terms and conditions herein provided.

         1.       Exercise of Warrants.

                  (a) Subject to subsection (b) of this Section 1, upon
presentation and surrender of this Warrant Agreement, with the attached Purchase
Form duly executed, at the principal office of the Company, or at such other
place as the Company may designate by written notice to the Holder hereof,
together with a certified or bank cashier's check payable to the order of the
Company in the amount of the Exercise Price times the number of Shares being
purchased (or in the case of exercise pursuant to Section 1 (c)(i) or (ii), as
set forth in such sections), the. Company shall deliver to the Holder hereof
within five (5) days, certificates representing the Shares being purchased. This
Warrant may be exercised in whole or in part; and, in case of exercise hereof in
part only, the Company, upon surrender hereof, will deliver to the Holder a new
Warrant Agreement or Warrant Agreements of like tenor entitling the Holder to
purchase the number of Shares as to which this Warrant has not been exercised at
the same Exercise Price as determined by this Warrant Agreement.

                  (b) This Warrant may be exercised, as to any shares of Common
Stock pursuant to this Warrant Agreement, at a price of $0.32 per share (the
"Exercise Price"). Holder shall have right to purchase 152,000 shares of Common
Stock underlying this Warrant Agreement beginning December 2, 2002. The Warrant
shall expire upon the close of business December 2, 2007.

                  (c) The Exercise Price shall be payable at the time of
exercise. The Exercise Price may be paid in cash (by cashiers' check) or by: (i)
surrender of shares of Common Stock of the Company already owned by the Holder,
or (ii) by converting this Warrant Agreement into Shares as provided in this
Section 1 (c)(ii), each election to be effected by surrender of this

<PAGE>

Warrant Agreement to the Company, together with the Net Issuance Exercise Notice
in the form attached hereto indicating such election, in which case the Company
shall issue to the Holder the number of Shares determined as follows:

                  X = Y (A-B)      Where: X = the number of Shares to be issued
                      -------
                         A                Y = the number of Shares as to which
                                              the Warrant Agreement is being
                                              exercised

                                          A = the Fair Market Value (as defined
                                              below) of one Share

                                          B = Exercise Price

         For purposes of the above calculations, the Fair Market Value of a
Share shall be determined as of the time of exercise to be equal to the average
of the closing bid and asked prices of the Common Stock as quoted in the
Over-the Counter Market Summary or the last reported sale price of the Common
Stock quoted on the American Stock Exchange or the closing price on any exchange
on which the Common Stock is then listed.

         2.       Exchange of Warrant.

                  At any time prior to the exercise hereof, upon presentation
and surrender to the Company, this Warrant may be exchanged, alone or with other
Warrants of like tenor registered in the name of the Holder, for another Warrant
or other Warrants of like tenor in the name of such Holder exercisable for the
same aggregate number of Shares as the Warrant or Warrants surrendered.

         3.       Rights and Oblations of Warrant Holder.

                  (a) The Holder of this Warrant Agreement shall not, by virtue
hereof, be entitled to any rights of a stockholder in the Company, either at law
or in equity; provided, however, that in the event that any certificate
representing the Shares is issued to the Holder hereof upon exercise of this
Warrant, such Holder shall, for all purposes, be deemed to have become the
holder of record of such Shares on the date on which this Warrant Agreement,
together with a duly executed Purchase Form, was surrendered and payment of the
Exercise Price was made, irrespective of the date of delivery of such Share
certificate. The rights of the Holder of this Warrant are limited to those
expressed herein and the Holder of this Warrant, by its acceptance hereof,
consents to and agrees to be bound by and to comply with all the provisions of
this Warrant Agreement, including, without limitation, all the obligations
imposed upon the Holder hereof by Sections 2 and 5 hereof. In addition, the
Holder of this Warrant Agreement, by accepting the same, agrees that the Company
may deem and treat the person in whose name this Warrant Agreement is registered
on the books of the Company maintained for such purposes as the absolute, true
and lawful owner for all purposes whatsoever, notwithstanding any notation of
ownership or other writing thereon, and the Company shall not be affected by any
notice to the contrary.

                  (b) No Holder of this Warrant Agreement shall be entitled to
vote or receive dividends or to be deemed the holder of Shares for any purpose,
nor shall anything contained in

                                       2
<PAGE>

this Warrant Agreement be construed to confer upon any Holder of this Warrant
Agreement any of the rights of a stockholder of the Company or any right to
vote, give or withhold consent to any action by the Company, whether upon any
recapitalization, issue of stock, reclassification of stock, consolidation,
merger, conveyance or otherwise, receive notice of meetings or other action
affecting stockholders (except for notices provided for herein), receive
dividends, subscription rights, or otherwise, until this Warrant shall have been
exercised and the Shares purchasable upon the exercise thereof shall have become
deliverable as provided herein; provided, however, that any such exercise on any
date when the stock transfer books of the Company shall be closed shall
constitute the person in whose name the certificate for those Shares are to be
issued as the record holder thereof for all purposes at the opening of business
on the next succeeding day on which such stock transfer books are open, and the
Warrant surrendered shall not be deemed to have been exercised, in whole or in
part as the case may be, until the next succeeding day on which stock transfer
books are open for the purpose of determining entitlement to dividends on the
Company's common stock.

         4.       Shares Underlying Warrants.

                  The Company covenants and agrees that all Shares delivered
upon exercise of this Warrant shall, upon delivery of payment therefor, be duly
and validly authorized and issued, fully paid and non-assessable and free and
clear of all taxes, liens and charges of any kind whatsoever, with
transferability subject to compliance with applicable securities laws.

         5.       Disposition of Warrants or Shares.

                  It shall be a condition to the transfer of this Warrant that
any transferee of this Warrant deliver to the Company his/its written agreement
to accept and be bound by all of the terms and conditions of this Warrant
Agreement.

         6.       Adjustments.

                  The number of Shares purchasable upon the exercise of each
Warrant is subject to adjustment from time to time upon the occurrence of any of
the events enumerated below:

                  (a) If at any time after the date of this Warrant and so long
as this Warrant is outstanding, there is a stock split, stock dividend,
subdivision, or similar distribution with respect to the Common Stock, or a
combination of the Common Stock, then, in such event, the Exercise Price shall
be adjusted in accordance with (b) below.

                  (b) Immediately upon the effective date of any event requiring
adjustment pursuant to (a), the Company shall adjust the Exercise Price then in
effect (to the nearest whole cent) as follows:

                           (i) in the event such adjustment is caused by a
                  forward stock split, stock dividend, subdivision, or other
                  similar distribution of shares of Common Stock, the Exercise
                  Price in effect, immediately prior to the effective date of
                  such event shall be decreased to an amount which shall bear
                  the same relation to the Exercise Price in effect immediately
                  prior to such event as the total number of shares of Common
                  Stock outstanding immediately prior to such event bears to the

                                        3

<PAGE>

                  total number of shares of Common Stock outstanding immediately
                  after such event;

                           (ii) in the event such adjustment is caused by a
                  combination of shares of Common Stock, the Exercise Price in
                  effect immediately prior to the close of business on the
                  effective date of such event shall be increased to an amount
                  which shall bear the same relation to the Exercise Price in
                  effect immediately prior to such event as the total number of
                  shares of Common Stock outstanding immediately prior to such
                  event bears to the total number of shares of Common Stock
                  outstanding immediately after such event.

                  (c) Upon each adjustment of the Exercise Price pursuant to (b)
above, the Warrant outstanding prior to such adjustment in the Exercise Price
shall thereafter evidence the right to purchase, at the adjusted Exercise Price,
that number of shares of Common Stock (calculated to the nearest hundredth)
obtained by (i) multiplying the number of shares of Common Stock issuable upon
exercise of the Warrant prior to adjustment of the number of shares of Common
Stock by the Exercise Price in effect prior to adjustment of the Exercise Price
and (ii) dividing the product so obtained by the Exercise Price in effect after
such adjustment of the exercise price.

                  (d) In case the Company (i) consolidates with or merges into
any other entity and is not the continuing or surviving entity of such
consolidation or merger, or (ii) permits any other entity to consolidate with or
merge into the Company and the Company is the continuing or surviving Company
but, in connection with such consolidation or merger, the Common Stock is
changed into or exchanged for common stock or other securities of any other
entity or cash or any other assets, or (iii) transfers all or substantially all
of its properties and assets to any other entity, or (iv) effects a
reorganization or reclassification of the equity of the Company in such a way
that holders of Common Stock shall be entitled to receive stock, securities,
cash or assets with respect to or in exchange for Common Stock, then, and in
each such case, proper provision shall be made so that, upon the exercise of
this Warrant at any time after the consummation of such consolidation, merger,
transfer, reorganization or reclassification, the Holder shall be entitled to
receive (at the aggregate Exercise Price in effect for Common Stock issuable
upon such exercise of this Warrant immediately prior to such consummation), in
lieu of Common Stock issuable upon such exercise of this Warrant prior to such
consummation, the stock and other securities, cash and assets to which such
Holder would have been entitled upon such consummation if such Holder had so
exercised this Warrant immediately prior thereto.

         7.       Loss or Destruction.

                  Upon receipt of evidence satisfactory to the Company of the
loss, theft, destruction or mutilation of this Warrant Agreement and, in the
case of any such loss, theft or destruction, upon delivery of an indemnity
agreement or bond satisfactory in form, substance and amount to the Company or,
in the case of any such mutilation, upon surrender and cancellation of this
Warrant Agreement, the Company will execute and deliver, in lieu thereof, a new
Warrant Agreement of like tenor.

         8.       Survival.

                                        4

<PAGE>

                  The various rights and obligations of the Holder hereof as set
forth herein shall survive the exercise of the Warrants represented hereby and
the surrender of this Warrant Agreement

         9.       Notices.

                  Whenever any notice, payment of any purchase price, or other
communication is required to be given or delivered under the terms of this
Warrant, it shall be in writing and delivered by hand delivery or United States
registered or certified mail, return receipt requested, postage prepaid (or
similar delivery if outside of the United States), and will be deemed to have
been given or delivered on the date such notice, purchase price or other
communication is so delivered or posted, as the case may be; and, if to the
Company, it will be addressed to the address specified on the cover page hereof,
and if to the Holder, it will be addressed to the address appearing on the
signature page hereto.

                                          SURGICARE, INC.

                                          By:  /s/ KEITH LEBLANC
                                              ---------------------------------
                                          Title: CEO
                                                 ------------------------------

                                          HOLDER

                                          TLC CAPITAL CORPORATION

                                          By:  /s/ ROBERT W. MAY
                                              ---------------------------------
                                          Name: Robert W. May
                                               --------------------------------
                                          Title: Secretary
                                                 ------------------------------

                                        5

<PAGE>

                                  PURCHASE FORM
                  (To be signed only upon exercise of Warrant)

To SurgiCare, Inc.:

         The undersigned, the holder of the enclosed Warrant, hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, ________________ (*) shares of Common Stock of SurgiCare,
Inc. and herewith makes payment of $______________________ therefor, and
requests that the certificate or certificates for such shares be issued in the
name of and delivered to the undersigned.

Dated:
       -----------------------------

                                     ------------------------------------------
                                     (Signature must conform in all respects to
                                     name of holder as specified on the face of
                                     the enclosed Warrant)

                                     ------------------------------------------

                                     ------------------------------------------
                                     (Address)

                                     ------------------------------------------
                                     (SSN#)

----------

(*)      Insert here the number of shares called for on the face of the Warrant
         without making any adjustment for additional Common Stock or any other
         stock or other securities or property or cash which, pursuant to the
         adjustment provisions of the Warrant Agreement pursuant to which the
         Warrant was granted, may be delivered upon exercise.

                                        6

<PAGE>

                         NOTICE OF NET ISSUANCE EXERCISE

To:                            :
    ---------------------------

         The undersigned hereby irrevocably elects to convert the attached
         Warrant Agreement into such number of shares of Common Stock of
         SurgiCare, Inc., a Delaware corporation (the "Company"), as is
         determined pursuant to Section 1 (c)(ii) of the attached Warrant
         Agreement. The undersigned requests that certificates of such net
         issuance shares be delivered to the address of the undersigned stated
         below.

Dated:

Name of Holder of Warrant:
                           -----------------------------------------------------
                                           (please print)

Address:
         ----------------------------------------------------------------------

Signature:
           --------------------------------------------------------------------

                                        7

<PAGE>
                                    EXHIBIT D

                                WARRANT AGREEMENT

                WARRANT TO PURCHASE 48,000 SHARES OF COMMON STOCK

                                 SURGICARE, INC.
                            (a Delaware corporation)
                         12727 Kimberley Lane, Suite 200
                              Houston, Texas 77024

                             Not Exercisable Except
                        upon Conditions Herein Specified

         SURGICARE, INC., a Delaware corporation ("Company"), hereby certifies
that THOMAS YERDEN, his registered successors and permitted assigns registered
on the books of the Company maintained for such purposes, as the registered
holder hereof ("Holder"), for value received in connection with that certain
Settlement Agreement by and between the Company, Holder and TLC Capital
Corporation dated December 2, 2002 (the "Settlement Agreement"), is entitled to
purchase from the Company the number of fully paid and non-assessable shares of
Common Stock of the Company, $.005 par value ("Shares" or "Common Stock"),
stated above at the purchase price per Share set forth in Section 1(b) below
(the number of Shares and Exercise Price being subject to adjustment as
hereinafter provided) upon the terms and conditions herein provided.

         1. Exercise of Warrants.

                  (a) Subject to subsection (b) of this Section 1, upon
presentation and surrender of this Warrant Agreement, with the attached Purchase
Form duly executed, at the principal office of the Company, or at such other
place as the Company may designate by written notice to the Holder hereof,
together with a certified or bank cashier's check payable to the order of the
Company in the amount of the Exercise Price times the number of Shares being
purchased (or in the case of exercise pursuant to Section 1(c)(i) or (ii), as
set forth in such sections), the Company shall deliver to the Holder hereof,
within five (5) days, certificates representing the Shares being purchased. This
Warrant may be exercised in whole or in part; and, in case of exercise hereof in
part only, the Company, upon surrender hereof, will deliver to the Holder a new
Warrant Agreement or Warrant Agreements of like tenor entitling the Holder to
purchase the number of Shares as to which this Warrant has not been exercised at
the same Exercise Price as determined by this Warrant Agreement.

                  (b) This Warrant may be exercised, as to any shares of Common
Stock pursuant to this Warrant Agreement, at a price of $0.32 per share (the
"Exercise Price"). Holder shall have right to purchase 48,000 shares of Common
Stock underlying this Warrant Agreement beginning December 2, 2002. The Warrant
shall expire upon the close of business December 2, 2007.

                  (c) The Exercise Price shall be payable at the time of
exercise. The Exercise Price may be paid in cash (by cashiers' check) or by: (i)
surrender of shares of Common Stock of the Company already owned by the Holder,
or (ii) by converting this Warrant Agreement into Shares as provided in this
Section 1(c)(ii), each election to be effected by surrender of this

<PAGE>

Warrant Agreement to the Company, together with the Net Issuance Exercise Notice
in the form attached hereto indicating such election, in which case the Company
shall issue to the Holder the number of Shares determined as follows:

                  X = Y (A-B)       Where: X = the number of Shares to be issued
                      -------
                         A                 Y = the number of Shares as to which
                                               the Warrant Agreement is being
                                               exercised

                                           A = the Fair Market Value (as defined
                                               below) of one Share

                                           B = Exercise Price

         For purposes of the above calculations, the Fair Market Value of a
Share shall be determined as of the time of exercise to be equal to the average
of the closing bid and asked prices of the Common Stock as quoted in the
Over-the-Counter Market Summary or the last reported sale price of the Common
Stock quoted on the American Stock Exchange or the closing price on any exchange
on which the Common Stock is then listed.

         2. Exchange of Warrant.

                  At any time prior to the exercise hereof, upon presentation
and surrender to the Company, this Warrant may be exchanged, alone or with other
Warrants of like tenor registered in the name of the Holder, for another Warrant
or other Warrants of like tenor in the name of such Holder exercisable for the
same aggregate number of Shares as the Warrant or Warrants surrendered.

         3. Rights and Oblations of Warrant Holder.

                  (a) The Holder of this Warrant Agreement shall not, by virtue
hereof, be entitled to any rights of a stockholder in the Company, either at law
or in equity; provided, however, that in the event that any certificate
representing the Shares is issued to the Holder hereof upon exercise of this
Warrant, such Holder shall, for all purposes, be deemed to have become the
holder of record of such Shares on the date on which this Warrant Agreement,
together with a duly executed Purchase Form, was surrendered and payment of the
Exercise Price was made, irrespective of the date of delivery of such Share
certificate. The rights of the Holder of this Warrant are limited to those
expressed herein and the Holder of this Warrant, by his acceptance hereof,
consents to and agrees to be bound by and to comply with all the provisions of
this Warrant Agreement, including, without limitation, all the obligations
imposed upon the Holder hereof by Sections 2 and 5 hereof. In addition, the
Holder of this Warrant Agreement, by accepting the same, agrees that the Company
may deem and treat the person in whose name this Warrant Agreement is registered
on the books of the Company maintained for such purposes as the absolute, true
and lawful owner for all purposes whatsoever, notwithstanding any notation of
ownership or other writing thereon, and the Company shall not be affected by any
notice to the contrary.

                  (b) No Holder of this Warrant Agreement shall be entitled to
vote or receive dividends or to be deemed the holder of Shares for any purpose,
nor shall anything contained in

                                       2
<PAGE>

this Warrant Agreement be construed to confer upon any Holder of this Warrant
Agreement any of the rights of a stockholder of the Company or any right to
vote, give or withhold consent to any action by the Company, whether upon any
recapitalization, issue of stock, reclassification of stock, consolidation,
merger, conveyance or otherwise, receive notice of meetings or other action
affecting stockholders (except for notices provided for herein), receive
dividends, subscription rights, or otherwise, until this Warrant shall have been
exercised and the Shares purchasable upon the exercise thereof shall have become
deliverable as provided herein; provided, however, that any such exercise on any
date when the stock transfer books of the Company shall be closed shall
constitute the person in whose name the certificate for those Shares are to be
issued as the record holder thereof for all purposes at the opening of business
on the next succeeding day on which such stock transfer books are open, and the
Warrant surrendered shall not be deemed to have been exercised, in whole or in
part as the case may be, until the next succeeding day on which stock transfer
books are open for the purpose of determining entitlement to dividends on the
Company's common stock.

         4. Shares Underlying Warrants.

                  The Company covenants and agrees that all Shares delivered
upon exercise of this Warrant shall, upon delivery of payment therefor, be duly
and validly authorized and issued, fully paid and non-assessable and free and
clear of all taxes, liens and charges of any kind whatsoever, with
transferability subject to compliance with applicable securities laws.

         5. Disposition of Warrants or Shares.

                  It shall be a condition to the transfer of this Warrant that
any transferee of this Warrant deliver to the Company his/its written agreement
to accept and be bound by all of the terms and conditions of this Warrant
Agreement.

         6. Adjustments.

                  The number of Shares purchasable upon the exercise of each
Warrant is subject to adjustment from time to time upon the occurrence of any of
the events enumerated below:

                  (a) If at any time after the date of this Warrant and so long
as this Warrant is outstanding, there is a stock split, stock dividend,
subdivision, or similar distribution with respect to the Common Stock, or a
combination of the Common Stock, then, in such event, the Exercise Price shall
be adjusted in accordance with (b) below.

                  (b) Immediately upon the effective date of any event requiring
adjustment pursuant to (a), the Company shall adjust the Exercise Price then in
effect (to the nearest whole cent) as follows:

                           (i) in the event such adjustment is caused by a
                  forward stock split, stock dividend, subdivision, or other
                  similar distribution of shares of Common Stock, the Exercise
                  Price in effect, immediately prior to the effective date of
                  such event shall be decreased to an amount which shall bear
                  the same relation to the Exercise Price in effect immediately
                  prior to such event as the total number of shares of Common
                  Stock outstanding immediately prior to such event bears to the

                                       3
<PAGE>

                  total number of shares of Common Stock outstanding immediately
                  after such event;

                           (ii) in the event such adjustment is caused by a
                  combination of shares of Common Stock, the Exercise Price in
                  effect immediately prior to the close of business on the
                  effective date of such event shall be increased to an amount
                  which shall bear the same relation to the Exercise Price in
                  effect immediately prior to such event as the total number of
                  shares of Common Stock outstanding immediately prior to such
                  event bears to the total number of shares of Common Stock
                  outstanding immediately after such event.

                  (c) Upon each adjustment of the Exercise Price pursuant to (b)
above, the Warrant outstanding prior to such adjustment in the Exercise Price
shall thereafter evidence the right to purchase, at the adjusted Exercise Price,
that number of shares of Common Stock (calculated to the nearest hundredth)
obtained by (i) multiplying the number of shares of Common Stock issuable upon
exercise of the Warrant prior to adjustment of the number of shares of Common
Stock by the Exercise Price in effect prior to adjustment of the Exercise Price
and (ii) dividing the product so obtained by the Exercise Price in effect after
such adjustment of the exercise price.

                  (d) In case the Company (i) consolidates with or merges into
any other entity and is not the continuing or surviving entity of such
consolidation or merger, or (ii) permits any other entity to consolidate with or
merge into the Company and the Company is the continuing or surviving Company
but, in connection with such consolidation or merger, the Common Stock is
changed into or exchanged for common stock or other securities of any other
entity or cash or any other assets, or (iii) transfers all or substantially all
of its properties and assets to any other entity, or (iv) effects a
reorganization or reclassification of the equity of the Company in such a way
that holders of Common Stock shall be entitled to receive stock, securities,
cash or assets with respect to or in exchange for Common Stock, then, and in
each such case, proper provision shall be made so that, upon the exercise of
this Warrant at any time after the consummation of such consolidation, merger,
transfer, reorganization or reclassification, the Holder shall be entitled to
receive (at the aggregate Exercise Price in effect for Common Stock issuable
upon such exercise of this Warrant immediately prior to such consummation), in
lieu of Common Stock issuable upon such exercise of this Warrant prior to such
consummation, the stock and other securities, cash and assets to which such
Holder would have been entitled upon such consummation if such Holder had so
exercised this Warrant immediately prior thereto.

         7. Loss or Destruction.

                  Upon receipt of evidence satisfactory to the Company of the
loss, theft, destruction or mutilation of this Warrant Agreement and, in the
case of any such loss, theft or destruction, upon delivery of an indemnity
agreement or bond satisfactory in form, substance and amount to the Company or,
in the case of any such mutilation, upon surrender and cancellation of this
Warrant Agreement, the Company will execute and deliver, in lieu there of a new
Warrant Agreement of like tenor.

         8. Survival.

                                       4
<PAGE>

                  The various rights arid obligations of the Holder hereof as
set forth herein shall survive the exercise of the Warrants represented hereby
and the surrender of this Warrant Agreement.

         9. Notices.

                  Whenever any notice, payment of any purchase price, or other
communication is required to be given or delivered under the terms of this
Warrant, it shall be in writing and delivered by hand delivery or United States
registered or certified mail, return receipt requested, postage prepaid (or
similar delivery if outside of the United States), and will be deemed to have
been given or delivered on the date such notice, purchase price or other
communication is so delivered or posted, as the case may be; and, if to the
Company, it will be addressed to the address specified on the cover page hereof,
and if to the Holder, it will be addressed to the address appearing on the
signature page hereto,

                                       SURGICARE, INC.

                                       By: /s/ KEITH LEBLANC
                                          --------------------------------------

                                       Title: CEO
                                             -----------------------------------

                                       HOLDER:

                                       By: /s/ THOMAS YERDEN
                                          --------------------------------------
                                                Thomas Yerden
                                       Address: 603 5. Broadway
                                                Suite B
                                                Boulder, Colorado 80305

                                       5
<PAGE>

                                  PURCHASE FORM
                  (To be signed only upon exercise of Warrant)

To SurgiCare, Inc.:

         The undersigned, the holder of the enclosed Warrant, hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, _________(*) shares of Common Stock of SurgiCare, Inc. and
herewith makes payment of $______________________ therefor, and requests that
the certificate or certificates for such shares be issued in the name of and
delivered to the undersigned.

Dated:
      ----------------------------

                                       -----------------------------------------
                                       (Signature must conform in all respects
                                       to name of holder as specified on the
                                       face of the enclosed Warrant)

                                       -----------------------------------------

                                       -----------------------------------------
                                       (Address)

                                       -----------------------------------------
                                       (SSN#)

----------

(*)      Insert here the number of shares called for on the face of the Warrant
         without making any adjustment for additional Common Stock or any other
         stock or other securities or property or cash which, pursuant to the
         adjustment provisions of the Warrant Agreement pursuant to which the
         Warrant was granted, may be delivered upon exercise.

                                       6
<PAGE>

                         NOTICE OF NET ISSUANCE EXERCISE

To:                               :
   -------------------------------

         The undersigned hereby irrevocably elects to convert the attached
         Warrant Agreement into such number of shares of Common Stock of
         SurgiCare, Inc., a Delaware corporation (the "Company"), as is
         determined pursuant to Section 1(c)(ii) of the attached Warrant
         Agreement. The undersigned requests that certificates of such net
         issuance shares be delivered to the address of the undersigned stated
         below.

Dated:
      -------------

Name of Holder of Warrant:
                          ------------------------------------------------------
                                             (please print)

Address:
        ------------------------------------------------------------------------

Signature:
          ----------------------------------------------------------------------

                                       7
<PAGE>

                                    EXHIBIT E

                          REGISTRATION RIGHTS AGREEMENT

         This Registration Rights Agreement (this "Agreement"), dated as of
December 2, 2002, is by and between SURGICARE, INC., a Delaware corporation
("Company"), and Thomas Yerden ("Holder").

                                   WITNESSETH:

         WHEREAS, Holder was issued a warrant to purchase 48,000 shares of
common stock dated the date hereof and a First Amendment to a warrant to
purchase 32,829 shares of common stock (the 48,000 shares of common stock and
32,829 shares of common stock are collectively referred to as "Shares"); and

         WHEREAS, the Company desires to grant to Holder certain registration
rights with respect to the Shares.

         NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:

                                   ARTICLE ONE
                          Registration Rights Agreement

         SECTION 1.1 Registration Rights Available. Subject to the terms of this
Agreement, the Company agrees to provide Holder with unlimited rights to
register on a "piggy-back" basis all of the Shares upon any registration
statement filed by the Company with the SEC. Such rights are referred to herein
as "Registration Rights." With respect to the Shares described hereby, such
Shares would include other securities issued or issuable at any time or from
time to time in respect of the Shares upon a stock split, stock dividend,
recapitalization or other similar event involving the Company (collectively, the
"Securities").

         SECTION 1.2 Piggy-back Registration, With respect to Holder's
Registration Rights, the parties agree as follows:

         (a) Pursuant to Section 1.1, the Company will (i) promptly give to
Holder written notice of any registration statement relating to the Company
securities; and (ii) include in such registration (and related qualification
under blue sky laws or other compliance), all the Securities specified in
Holder's written request or requests, mailed in accordance with Section 3.8
herein within 30 days after the date of such written notice from the Company.

         SECTION 1.3 Registration Procedure. With respect to each Registration
Right, the following provisions shall apply:

         (a) Holder shall be obligated to furnish to the Company such
information regarding the Securities and the proposed manner of distribution of
the Securities as the Company may request in writing and as shall be required in
connection with any registration, qualification or compliance referred to herein
and shall otherwise cooperate with the Company in connection with such
registration, qualification or compliance.

<PAGE>

         (b) With a view to making available the benefits of certain rules and
regulations of the SEC which may at any time permit the sale of Restricted
Securities (as defined in Rule 144 under the Securities Act) to the public
without registration, the Company agrees to use its best lawful efforts to:

                  (i) Make and keep public information available, as those terms
         are understood and defined in Rule 144 under the Securities Act, at all
         times during which the Company is subject to the reporting requirements
         of the Securities Exchange Act of 1934, as amended ("Exchange Act");

                  (ii) File with the SEC in a timely manner all reports and
         other documents required of the Company under the Securities Act and
         the Exchange Act (at all times during which the Company is subject to
         such reporting requirements); and

                  (iii) So long as Holder owns any Restricted Securities, to
         furnish to Holder forthwith upon request a written statement by the
         Company as to its compliance with the reporting requirements of said
         Rule 144 and with regard to the Securities Act and the Exchange Act (at
         all times during which the Company is subject to such reporting
         requirements), a copy of the most recent annual or quarterly report of
         the Company, and such other reports and documents of the Company and
         other information in the possession of or reasonably obtainable by the
         Company as Holder may reasonably request in availing Holder of any rule
         or regulation of the Commission allowing Holder to sell any such
         securities without registration.

         (c) The Company agrees that it will furnish to Holder such number of
prospectuses, offering circulars or other documents incident to any
registration, qualification or compliance referred to herein as provided or, if
not otherwise provided, as Holder from time to time may reasonably request.

         (d) All expenses (except for legal fees for Holder's attorney and any
sales commission paid by Holder) of any registrations permitted pursuant to this
Agreement and of all other offerings by the Company (including, but not limited
to, the expenses of any qualifications under the blue-sky or other state
securities laws and compliance with governmental requirements of preparing and
filing any post-effective amendments required for the lawful distribution of the
Securities to the public in connection with such registration, of supplying
prospectuses, offering circulars or other documents) will be paid by the
Company.

         (e) In connection with the preparation and filing of a registration
statement under the Securities Act pursuant to this Agreement, the Company will
give Holder, and Holder's counsel and accountants, the opportunity to
participate in the preparation of such registration statement, each prospectus
included therein or filed with the Commission, and each amendment thereof or
supplement thereto.

                                   ARTICLE TWO
                                 Indemnification

         SECTION 2.1 Indemnification by the Company. In the event of any
registration of the Securities of the Company under the Securities Act, the
Company agrees to indemnify and hold harmless Holder and each other person who
participates as an underwriter in the offering or sale of such securities
against any and all claims, demands, losses, costs, expenses, obligations,
liabilities, joint or several, damages, recoveries and deficiencies, including
interest, penalties and attorneys' fees (collectively, "Claims"), to which
Holder or underwriter may become subject under the Securities

                                       2
<PAGE>

Act or otherwise, insofar as such Claims (or actions or proceedings, whether
commenced or threatened, in respect thereof) arise out of or are based on any
untrue statement or alleged untrue statement of any material fact contained in
any registration statement under which Holder's Securities were registered under
the Securities Act, any preliminary prospectus, final prospectus or summary
prospectus contained therein, or any amendment or supplement thereto, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
the Company will reimburse Holder and each such underwriter for any legal or any
other expenses reasonably incurred by them in connection with investigating or
defending any such Claim (or action or proceeding in respect thereof); provided
that the Company shall not be liable in any such case to the extent that any
such Claim (or action or proceeding in respect thereof) or expense arises out of
or is based on an untrue statement or alleged untrue statement or omission or
alleged omission made in such registration statement, any such preliminary
prospectus, final prospectus, summary prospectus, amendment or supplement in
reliance on and in conformity with written information furnished to the Company
through an instrument duly executed by Holder specifically stating that it is
for use in the preparation thereof. Such indemnity shall remain in full force
and effect regardless of any investigation made by or on behalf of Holder or any
such underwriter and shall survive the transfer of the Securities by Holder.

         SECTION 2.2 Indemnification by Holder. The Company may require, as a
condition to including the Securities in any registration statement filed
pursuant to this Agreement, that the Company shall have received an undertaking
satisfactory to it from Holder, to indemnify and hold harmless (in the same
manner and to the same extent as set forth in Section 2.1) the Company, each
director of the Company, each officer of the Company and each other person, if
any, who controls the Company, within the meaning of the Securities Act, with
respect to any statement or alleged statement in or omission or alleged omission
from such registration statement, any preliminary prospectus contained therein,
or any amendment or supplement thereto, if such statement or alleged statement
or omission or alleged omission was made in reliance on and in conformity with
written information furnished to the Company through an instrument duly executed
by Holder specifically stating that it is for use in the preparation of such
registration statement, preliminary prospectus, final prospectus, summary
prospectus, amendment or supplement. Notwithstanding the foregoing, the maximum
liability hereunder which any holder shall be required to suffer shall be
limited to the net proceeds to such Holder from the Shares sold by such Holder
in the offering. Such indemnity shall remain in full force and effect,
regardless of any investigation made by or on behalf of the Company or any such
director, officer or controlling person and shall survive the transfer of the
Securities by Holder.

         SECTION 2.3 Notices of Claims, etc. Promptly after receipt by an
indemnified party of notice of the commencement of any action or proceeding
involving a Claim referred to in this Article Two, such indemnified party will,
if a claim in respect thereof is to be made against an indemnifying party, give
written notice to the latter of the commencement of such action, provided that
the failure of any indemnified party to give notice as provided herein shall not
relieve the indemnifying party of its obligations under this Article Two, except
to the extent that the indemnifying party is actually prejudiced by such failure
to give notice. In case any such action is brought against an indemnifying
party, unless in such indemnified party's reasonable judgment a conflict of
interest between such indemnified and indemnifying parties may exist in respect
of such Claim, the indemnifying party shall be entitled to participate in and to
assume the defense thereof, jointly with any other indemnifying party similarly
notified to the extent that it may wish, with counsel reasonably satisfactory to
such indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party for any legal
or other expenses subsequently incurred by the latter in connection with the
defense thereof other than reasonable costs of investigation. No indemnifying
party shall, without the consent of the indemnified party, consent to entry of
any judgment or enter

                                       3
<PAGE>

into any settlement that does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a release from
all liability in respect of such Claim.

                                  ARTICLE THREE
                                  Miscellaneous

         SECTION 3.1 Consent to Amendments. Except as otherwise expressly
provided herein, the provisions of this Agreement may be amended or waived only
by the written agreement of the Company and Holder and shall be effective only
to the extent specifically set forth in such writing.

         SECTION 3.2 Term of the Agreement. This Agreement shall terminate with
respect to Holder one year from the date hereof.

         SECTION 3.3 Successors and Assigns. Except as otherwise expressly
provided herein, all covenants and agreements contained in this Agreement by or
on behalf of any of the parties hereto are transferable and will bind and inure
to the benefit of the respective successors and assigns of the parties hereto,
but only if so expressed in writing.

         SECTION 3.4 Severability. Whenever possible, each provision of this
Agreement will be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid under applicable law, such provision will be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of this Agreement.

         SECTION 3.5 Delays or Omissions. No failure to exercise or delay in the
exercise of any right, power or remedy accruing to Holder on any breach or
default of the Company under this Agreement shall impair any such right, power
or remedy nor shall it be construed to be a waiver of any such breach or
default.

         SECTION 3.6 Remedies Cumulative. All remedies under this Agreement, or
by law or otherwise afforded to any party hereto shall be cumulative and not
alternative.

         SECTION 3.7 Descriptive Headings. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a part of this
Agreement. Unless clearly denoted otherwise, any reference to Articles or
Sections contained herein shall be to the Articles or Sections of this
Agreement.

         SECTION 3.8 Notices. Any notices required or permitted to be sent
hereunder shall be delivered personally or mailed, certified mail, return
receipt requested, to the following addresses, and shall be deemed to have been
received on the day of personal delivery or within three business days after
deposit in the mail, postage prepaid:

                                       4
<PAGE>

                  If to the Company, to:

                  Surgicare, Inc.
                  12727 Kimberley Lane
                  Suite 200
                  Houston, Texas 77024
                  Attention: Keith LeBlanc

                  If to Holder, to:

                  --------------------------

                  --------------------------

                  --------------------------

         SECTION 3.9 Governing Law. The validity, meaning and effect of this
Agreement shall be determined in accordance with the laws of the State of Texas
applicable to contracts made and to be performed in that state.

         SECTION 3.10 Final Agreement. This Agreement, together with those
documents expressly referred to herein, constitutes the final agreement of the
parties concerning the matters referred to herein, and supersedes all prior
agreements and understandings.

         SECTION 3.11 Execution in Counterparts. This Agreement may be executed
in any number of counterparts, each of which when so executed and delivered
shall be deemed an original, and such counterparts together shall constitute one
instrument.

         The parties hereto have executed this Agreement as of the date first
set forth above.

                                       COMPANY:

                                       SURGICARE, INC.

                                       By /s/ KEITH LEBLANC
                                         ---------------------------------------
                                         Keith LeBlanc, President

                                     HOLDER:

                                     /s/ THOMAS R. YERDEN
                                     -------------------------------------------
                                     Printed Name  Thomas R. Yerden
                                                 -------------------------------

                                       5
<PAGE>

                                    EXHIBIT F
                          REGISTRATION RIGHTS AGREEMENT

         This Registration Rights Agreement (this "Agreement"), dated as of
December 2, 2002, is by and between SURGICARE, INC., a Delaware corporation
("Company"), and TLC Capital Corporation ("Holder").

                                   WITNESSETH:

         WHEREAS, Holder was issued a warrant to purchase 152,000 shares of
common stock dated the date hereof and a First Amendment to a warrant to
purchase 103,957 shares of common stock (the 152,000 shares of common stock and
103,957 shares of common stock are collectively referred to as "Shares"); and

         WHEREAS, the Company desires to grant to Holder certain registration
rights with respect to the Shares.

         NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:

                                   ARTICLE ONE
                          Registration Rights Agreement

         SECTION 1.1 Registration Rights Available. Subject to the terms of this
Agreement, the Company agrees to provide Holder with unlimited rights to
register on a "piggy-back" basis all of the Shares upon any registration
statement filed by the Company with the SEC. Such rights are referred to herein
as "Registration Rights." With respect to the Shares described hereby, such
Shares would include other securities issued or issuable at any time or from
time to time in respect of the Shares upon a stock split, stock dividend,
recapitalization or other similar event involving the Company (collectively, the
"Securities").

         SECTION 1.2 Piggy-back Registration. With respect to Holder's
Registration Rights, the parties agree as follows:

         (a) Pursuant to Section 1.1, the Company will (i) promptly give to
Holder written notice of any registration statement relating to the Company
securities; and (ii) include in such registration (and related qualification
under blue sky laws or other compliance), all the Securities specified in
Holder's written request or requests, mailed in accordance with Section 3.8
herein within 30 days after the date of such written notice from the Company.

         SECTION 1.3 Registration Procedure. With respect to each Registration
Right, the following provisions shall apply:

         (a) Holder shall be obligated to furnish to the Company such
information regarding the Securities and the proposed manner of distribution of
the Securities as the Company may request in writing and as shall be required in
connection with any registration, qualification or compliance referred to herein
and shall otherwise cooperate with the Company in connection with such
registration, qualification or compliance.

<PAGE>

         (b) With a view to making available the benefits of certain rules and
regulations of the SEC which may at any time permit the sale of Restricted
Securities (as defined in Rule 144 under the Securities Act) to the public
without registration, the Company agrees to use its best lawful efforts to:

                  (i) Make and keep public information available, as those terms
         are understood and defined in Rule 144 under the Securities Act, at all
         times during which the Company is subject to the reporting requirements
         of the Securities Exchange Act of 1934, as amended ("Exchange Act");

                  (ii) File with the SEC in a timely manner all reports and
         other documents required of the Company under the Securities Act and
         the Exchange Act (at all times during which the Company is subject to
         such reporting requirements); and

                  (iii) So long as Holder owns any Restricted Securities, to
         furnish to Holder forthwith upon request a written statement by the
         Company as to its compliance with the reporting requirements of said
         Rule 144 and with regard to the Securities Act and the Exchange Act (at
         all times during which the Company is subject to such reporting
         requirements), a copy of the most recent annual or quarterly report of
         the Company, and such other reports and documents of the Company and
         other information in the possession of or reasonably obtainable by the
         Company as Holder may reasonably request in availing Holder of any rule
         or regulation of the Commission allowing Holder to sell any such
         securities without registration.

         (c) The Company agrees that it will furnish to Holder such number of
prospectuses, offering circulars or other documents incident to any
registration, qualification or compliance referred to herein as provided or, if
not otherwise provided, as Holder from time to time may reasonably request.

         (d) All expenses (except for legal fees for Holder's attorney and any
sales commission paid by Holder) of any registrations permitted pursuant to this
Agreement and of all other offerings by the Company (including, but not limited
to, the expenses of any qualifications under the blue-sky or other state
securities laws and compliance with governmental requirements of preparing and
filing any post-effective amendments required for the lawful distribution of the
Securities to the public in connection with such registration, of supplying
prospectuses, offering circulars or other documents) will be paid by the
Company.

         (e) In connection with the preparation and filing of a registration
statement under the Securities Act pursuant to this Agreement, the Company will
give Holder, and Holder's counsel and accountants, the opportunity to
participate in the preparation of such registration statement, each prospectus
included therein or filed with the Commission, and each amendment thereof or
supplement thereto.

                                   ARTICLE TWO
                                 Indemnification

         SECTION 2.1 Indemnification by the Company. In the event of any
registration of the Securities of the Company under the Securities Act, the
Company agrees to indemnify and hold harmless Holder and each other person who
participates as an underwriter in the offering or sale of such securities
against any and all claims, demands, losses, costs, expenses, obligations,
liabilities, joint or several, damages, recoveries and deficiencies, including
interest, penalties and attorneys' fees (collectively, "Claims"), to which
Holder or underwriter may become subject under the Securities

                                       2
<PAGE>

Act or otherwise, insofar as such Claims (or actions or proceedings, whether
commenced or threatened, in respect thereof) arise out of or are based on any
untrue statement or alleged untrue statement of any material fact contained in
any registration statement under which Holder's Securities were registered under
the Securities Act, any preliminary prospectus, final prospectus or summary
prospectus contained therein, or any amendment or supplement thereto, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
the Company will reimburse Holder and each such underwriter for any legal or any
other expenses reasonably incurred by them in connection with investigating or
defending any such Claim (or action or proceeding in respect thereof); provided
that the Company shall not be liable in any such case to the extent that any
such Claim (or action or proceeding in respect thereof) or expense arises out of
or is based on an untrue statement or alleged untrue statement or omission or
alleged omission made in such registration statement, any such preliminary
prospectus, final prospectus, summary prospectus, amendment or supplement in
reliance on and in conformity with written information furnished to the Company
through an instrument duly executed by Holder specifically stating that it is
for use in the preparation thereof. Such indemnity shall remain in full force
and effect regardless of any investigation made by or on behalf of Holder or any
such underwriter and shall survive the transfer of the Securities by Holder.

         SECTION 2.2 Indemnification by Holder. The Company may require, as a
condition to including the Securities in any registration statement filed
pursuant to this Agreement, that the Company shall have received an undertaking
satisfactory to it from Holder, to indemnify and hold harmless (in the same
manner and to the same extent as set forth in Section 2.1) the Company, each
director of the Company, each officer of the Company and each other person, if
any, who controls the Company, within the meaning of the Securities Act, with
respect to any statement or alleged statement in or omission or alleged omission
from such registration statement, any preliminary prospects contained therein,
or any amendment or supplement thereto, if such statement or alleged statement
or omission or alleged omission was made in reliance on and in conformity with
written information furnished to the Company through an instrument duly executed
by Holder specifically stating that it is for use in the preparation of such
registration statement, preliminary prospectus, final prospectus, summary
prospectus, amendment or supplement. Notwithstanding the foregoing, the maximum
liability hereunder which any holder shall be required to suffer shall be
limited to the net proceeds to such Holder from the Shares sold by such Holder
in the offering. Such indemnity shall remain in full force and effect,
regardless of any investigation made by or on behalf of the Company or any such
director, officer or controlling person and shall survive the transfer of the
Securities by Holder.

         SECTION 2.3 Notices of Claims. etc. Promptly after receipt by an
indemnified party of notice of the commencement of any action or proceeding
involving a Claim referred to in this Article Two, such indemnified party will,
if a claim in respect thereof is to be made against an indemnifying party, give
written notice to the latter of the commencement of such action, provided that
the failure of any indemnified party to give notice as provided herein shall not
relieve the indemnifying party of its obligations under this Article Two, except
to the extent that the indemnifying party is actually prejudiced by such failure
to give notice. In case any such action is brought against an indemnifying
party, unless in such indemnified party's reasonable judgment a conflict of
interest between such indemnified and indemnifying parties may exist in respect
of such Claim, the indemnifying party shall be entitled to participate in and to
assume the defense thereof, jointly with any other indemnifying party similarly
notified to the extent that it may wish, with counsel reasonably satisfactory to
such indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party for any legal
or other expenses subsequently incurred by the latter in connection with the
defense thereof other than reasonable costs of investigation. No indemnifying
party shall, without the consent of the indemnified party, consent to entry of
any judgment or enter

                                       3
<PAGE>

into any settlement that does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a release from
all liability in respect of such Claim.

                                  ARTICLE THREE
                                  Miscellaneous

         SECTION 3.1 Consent to Amendments. Except as otherwise expressly
provided herein, the provisions of this Agreement may be amended or waived only
by the written agreement of the Company and Holder and shall be effective only
to the extent specifically set forth in such writing.

         SECTION 3.2 Term of the Agreement. This Agreement shall terminate with
respect to Holder one year from the date hereof

         SECTION 3.3 Successors and Assigns. Except as otherwise expressly
provided herein, all covenants and agreements contained in this Agreement by or
on behalf of any of the parties hereto are transferable and will bind and inure
to the benefit of the respective successors and assigns of the parties hereto,
but only if so expressed in writing.

         SECTION 3.4 Severability. Whenever possible, each provision of this
Agreement will be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid under applicable law, such provision will be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of this Agreement.

         SECTION 3.5 Delays or Omissions. No failure to exercise or delay in the
exercise of any right, power or remedy accruing to holder on any breach or
default of the Company under this Agreement shall impair any such right, power
or remedy nor shall it be construed to be a waiver of any such breach or
default.

         SECTION 3.6 Remedies Cumulative. All remedies under this Agreement, or
by law or otherwise afforded to any party hereto shall be cumulative and not
alternative.

         SECTION 3.7 Descriptive Headings. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a part of this
Agreement. Unless clearly denoted otherwise, any reference to Articles or
Sections contained herein shall be to the Articles or Sections of this
Agreement.

         SECTION 3.8 Notices. Any notices required or permitted to be sent
hereunder shall be delivered personally or mailed, certified mail, return
receipt requested, to the following addresses, and shall be deemed to have been
received on the day of personal delivery or within three business days after
deposit in the mail, postage prepaid:

                                       4
<PAGE>

                  If to the Company, to:

                  Surgicare, Inc.
                  12727 Kimberley Lane
                  Suite 200
                  Houston, Texas 77024
                  Attention: Keith LeBlanc

                  If to Holder, to:

                  --------------------------

                  --------------------------

                  --------------------------

         SECTION 3.9 Governing Law. The validity, meaning and effect of this
Agreement shall be determined in accordance with the laws of the State of Texas
applicable to contracts made and to be performed in that state.

         SECTION 3.10 Final Agreement. This Agreement, together with those
documents expressly referred to herein, constitutes the final agreement of the
parties concerning the matters referred to herein, and supersedes all prior
agreements and understandings.

         SECTION 3.11 Execution in Counterparts. This Agreement may be executed
in any number of counterparts, each of which when so executed and delivered
shall be deemed an original, and such counterparts together shall constitute one
instrument.

         The parties hereto have executed this Agreement as of the date first
set forth above.

                                       COMPANY:

                                       SURGICARE, INC.

                                       By: /s/ KEITH LEBLANC
                                          --------------------------------------
                                          Keith LeBlanc, President

                                       HOLDER:

                                       /s/ ROBERT W. MAY
                                       -----------------------------------------
                                       Printed Name  Robert W. May
                                                   -----------------------------

                                       5<PAGE>
                                                                    EXHIBIT 10.2

                                    AGREEMENT

         This agreement is dated December 11, 2002 ("Agreement"), by and between
American International Industries, Inc., a Nevada corporation, Texas Real Estate
Enterprises, Inc., a Texas corporation, MidCity Houston Properties, Inc., a
Texas corporation, International Diversified Corporation, Ltd. ("IDC),
previously known as Elk International Corporation, Ltd. ("ELK"), and Daniel
Dror, an individual (collectively "American") and SurgiCare, Inc., a Delaware
corporation ("SurgiCare").

         WHEREAS, American and SurgiCare entered into a purchase agreement on
June 4, 2002 ("Purchase Agreement") and the parties desired to modify certain
terms of the Purchase Agreement and to enter into various other transactions as
described herein.

         NOW, THEREFORE, for good and valuable consideration, the receipt which
is hereby acknowledged and accepted, the parties agree as follows:

         1. Modification to the Certificate of Designation, Powers, Preferences
and Rights of the Series AA Redeemable Preferred Stock.

                  1.1 The parties agree to convert 300,000 shares of Series AA
Redeemable Preferred Stock ("Series AA") into 3,658,537 shares of SurgiCare
common stock, which common stock certificate is attached hereto as Exhibit "A".
American hereby acknowledges that SurgiCare has relied upon the representations
and warranties set forth in Section 3 of Exhibit "G-1" in determining to convert
the Series AA into shares of SurgiCare common stock. In connection with
American's conversion herein, American, hereby agrees to enter into a one year
irrevocable proxy attached hereto as Exhibit "H". The proxy will be released for
any shares that are sold to an unrelated third party.

                  1.2 With respect to the balance of the 900,000 shares of
Series AA, SurgiCare will file an amendment to the Certificate of Designation of
the Series AA in the form attached hereto as Exhibit "B" which modifies the
terms of the remaining 900,000 shares of Series AA as follows:

                  o     No later than June 1, 2004, SurgiCare shall have the
         option to redeem 300,000 shares of Series AA for a payment of
         $1,500,000 or to convert 300,000 shares of Series AA to a SurgiCare
         common stock equivalent of $1,500,000, calculated by dividing
         $1,500,000 by the average closing price for the 20 previous trading
         days prior to conversion, but not less than $0.41 per share.

                  o     No later than June 1, 2005, SurgiCare shall have the
         option to redeem 300,000 shares of Series AA for a payment of
         $1,500,000 or to convert 300,000 shares of Series AA to a SurgiCare
         common stock equivalent of $1,500,000, calculated by dividing
         $1,500,000 by the average closing price for the previous 20 previous
         trading days prior to conversion, but not less than $0.41 per share.

                                       1
<PAGE>

                  o     No later than June 1, 2006, SurgiCare shall have the
         option to redeem the remaining 300,000 shares of Series AA for a
         payment of $1,500,000 or to convert 300,000 shares of Series AA to a
         SurgiCare common stock equivalent of $1,500,000, calculated by dividing
         $1,500,000 by the average closing price for the 20 previous trading
         days prior to conversion, but not less than $0.41 per share.

         2. Agreement by American to Assist SurgiCare in Selling Land.

                  2.1 Daniel Dror, individually, and American, collectively,
agree to use their best efforts to assist SurgiCare in selling the land assets
acquired by SurgiCare pursuant to the Purchase Agreement ("Property").
Assistance includes sharing contacts of Daniel Dror and American with SurgiCare,
assisting in procuring appraisals, assisting in providing backup documentation
with respect to American's acquisition of such property and other reasonable
efforts. This requirement to assist SurgiCare shall continue for a period of
three years from the date hereof.

                  2.2 If, by June 1, 2006, SurgiCare is unable to sell any or
all of the Property for net sales proceeds to SurgiCare in an amount equal to or
greater than $4,000,000, American agrees on June 1, 2006 to return to SurgiCare
shares of SurgiCare common stock valued at $0.41 per share or cash, at the
option of American, equal to the difference between $4,000,000 and the net sales
proceeds received by SurgiCare from the sale of any of the Property during the
three year period from the date hereof. In the event that American does not own
any SurgiCare common stock, it agrees to pay such difference in cash upon such
date.

         3. Closing Sterling Bank Loan.

                  3.1 Upon the date of this Agreement, SurgiCare shall have
closed the Sterling Bank loan in the minimum amount of $1,500,000.

                  3.2 Upon such closing of such Sterling Bank loan, SurgiCare
shall have used proceeds from the Sterling Bank loan to pay $300,000 of
currently owed real estate taxes on the Property and American shall pay the
balance of $57,823.63 of real estate taxes on the Property as of the date of
closing of the land sale to SurgiCare. Attached hereto as Exhibit "C" is
documentation reflecting that all currently owed real estate taxes on the
Property have been paid as described herein.

                  3.3 SurgiCare will use funds from the Sterling Bank loan to
pay off in full the $700,000 and the $400,000 SurgiCare Royal Oaks Bank term
loans. Attached hereto as Exhibit "D" is documentation reflecting the payment in
full of both the $400,000 and $700,000 Royal Oaks Bank term loans.

         4. Indemnification of Mr. Altman's Claims.

                  4.1 American shall execute the indemnification and hold
harmless agreement attached hereto as Exhibit "F" indemnifying SurgiCare against
"certain claims" from Mr. Altman.

                                       2
<PAGE>

         5. Agreement to Cooperate.

                  5.1 Daniel Dror, individually, and American, collectively,
agree to make Mr. Dror available for depositions, affidavits and testimony in
connection with the lawsuit initiated by Charles Cohen against SurgiCare and Dr.
David Blumfield to testify regarding transactions of which Mr. Dror and Mr.
Cohen entered into.

                  5.2 In connection herewith, Mr. Dror represents that Mr. Cohen
was not compensated by American, directly or indirectly, for any transactions
that Mr. Cohen negotiated for or on behalf of SurgiCare or himself while Mr.
Cohen was employed by SurgiCare.

         6. Investment.

                  6.1 IDC agrees to purchase 2,439,024 shares of SurgiCare
common stock at $0.41 per share for an investment of $1,000,000. This investment
shall fund upon the date hereof and IDC shall enter into the subscription
agreement attached hereto as Exhibit "G."

                  6.2 At the time of issuance of the SurgiCare shares to IDC,
IDC will deliver out of the newly issued shares to SurgiCare, 730,000 of
SurgiCare common stock representing a pledge made by Dr. Blumfield for the
$400,000 Royal Oaks loan. SurgiCare and Elk shall enter into the indemnification
and hold harmless agreement attached hereto as Exhibit "E." In addition, due to
the sale of a portion of the pledged shares, IDC agrees to reimburse to
SurgiCare $400,000 by January 15, 2003. SurgiCare shall hold the remaining
1,709,024 shares as collateral for the required $400,000 payment. IDC shall
forfeit a pro-rated portion of these shares if payment in full is not made by
January 15, 2003.

                  6.3 In connection with IDC's investment herein, IDC, hereby
agrees to enter into a one year irrevocable proxy attached hereto as Exhibit
"H-2". The proxy will be released for any shares that are sold to an unrelated
third party.

         7. Additional Fundraising.

                  7.1 SurgiCare is in the process of raising additional funds to
fund its working capital obligations and to refinance existing debt obligations.
SurgiCare will raise up to $2,500,000 to be funded no later than January 31,
2003.

         8. General Obligations.

                  8.1 At any time and from time to time, the parties agree, at
their expense, to take such actions and to execute and deliver such documents as
may be reasonably necessary to effectuate the purposes of this Agreement.

                  8.2 Without limiting the terms and provisions hereof, since a
breach of the provisions of this Agreement could not adequately be compensated
by money damages, the

                                       3
<PAGE>

parties shall be entitled in addition to any other right or remedy available to
them, to an injunction restraining such breach or a threatened breach and to
specific performance of any such provision of this Agreement; and in either
case, no bond or other security shall be required in connection therewith, and
the parties hereby consent to the issuance of such an injunction and to the
ordering of specific performance.

                  8.3 The Agreement and the exhibits hereto set forth the entire
understanding of the parties with respect to the subject matter hereof supersede
all existing agreements (including the letter of intent dated November 15, 2002)
among them concerning such subject matter, and may be amended or modified only
by a written instrument duly executed by the Parties.

                  8.4 Any notice or other communication required or permitted to
be given hereunder shall be in writing and shall be delivered by personal
delivery or by overnight delivery or mailed by certified mail, return receipt
requested (or by the most nearly comparable method if mailed from or to a
location outside of the United States), or delivered against receipt to the
party to whom it is to be given at the address of such party set forth in the
signature pages to this Agreement. Any notice or other communication given by
certified mail (or by such comparable method) shall be deemed given at the time
of mailing (or comparable act), except for a notice changing a party's address,
which will be deemed given at the time of receipt thereof.

                  8.5 Any waiver by any party of a breach of any provision of
this Agreement shall not operate as or be construed to be a waiver of any other
breach of that provision or of any breach of any other provision of this
Agreement. The failure of a party to insist upon strict adherence to any term of
this Agreement on one or more occasions will not be considered a waiver or
deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in writing
and, in the case of a corporate party, be authorized by a resolution of the
board of directors or by an officer of the waiving party.

                  8.6 The provisions of this Agreement shall be binding upon and
inure to the benefit of each party's respective successors, assigns, heirs, and
personal representatives.

                  8.7 This Agreement does not create, and shall not be construed
as creating, any rights enforceable by any Person not a party to this Agreement.

                  8.8 If any provision of this Agreement is invalid, illegal, or
unenforceable, the balance of this Agreement shall remain in effect, and if any
provision is inapplicable to any Person or circumstance, it shall nevertheless
remain applicable to all other persons and circumstances.

                  8.9 The headings of this Agreement are solely for convenience
of reference and shall be given no effect in the construction or interpretation
of this Agreement.

                  8.10 This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same

                                       4
<PAGE>

instrument. It shall be governed by and construed in accordance with the laws of
the State of Texas without giving effect to conflict of laws. Each of the
parties agrees that any action brought between the parties may be brought only
in the state or federal courts located in Harris County, Texas, and in no other
place unless the parties expressly agree in writing to waive this requirement.
Each of the parties consents to jurisdiction in that location.

                  8.11 Each of the parties will bear all of its own legal,
accounting, investment banking, and other expenses incurred in connection with
this Agreement.

                  8.12 The language used in this Agreement will be deemed to be
the language chosen by the parties to express their mutual intent. No rule of
strict construction will be applied against any party. Any reference to a
federal, state, local or foreign statute or law will be deemed to also refer to
all rules and regulations as promulgated, unless the context requires otherwise.
Thus, use of the word "including" in this Agreement is intended by the parties
to be by way of example rather than limitation.

                  8.13 This Agreement and all actions taken hereunder shall be
governed by and construed in accordance with the laws of the State of Texas. In
the event there arises a disagreement between the parties to this Agreement in
which one party has, or claims to have, claims against the other, all such
claims and disputes shall be resolved by arbitration under the Rules of American
Arbitration Association.

                  8.14 The exhibits identified in this Agreement are
incorporated by reference and made a part of this Agreement.

IN WITNESS WHEREOF, the parties have duly executed this Agreement.

AMERICAN INTERNATIONAL INDUSTRIES, INC.

By: /s/ Daniel Dror
    ------------------------------
Name: Daniel Dror
Title: CEO
Address: 601 Cien Street
         Kemah, TX  77565

                                       5
<PAGE>
TEXAS REAL ESTATE ENTERPRISES, INC.

By: /s/ Daniel Dror
    ------------------------------
Name: Daniel Dror
Title: Vice President
Address: 601 Cien Street
         Kemah, TX  77565

INTERNATIONAL DIVERSIFIED CORPORATION, LTD.

By: /s/ Elkana Faiwuszewicz
    ------------------------------
    Elkana Faiwuszewicz, CEO

Address:
         -------------------------

         -------------------------

MIDCITY HOUSTON PROPERTIES, INC.

By: /s/ Daniel Dror
    ------------------------------
Name: Daniel Dror
Title: Vice President
Address: 601 Cien Street
         Kemah, TX  77565

DANIEL DROR

/s/ Daniel Dror
----------------------------------

Address:
         -------------------------

         -------------------------

SURGICARE, INC.

By: /s/ Phil Scott
    ------------------------------

Name: Phillip C. Scott
Title:  CFO
Address: 12727 Kimberley Lane, Suite 200
         Houston, TX  77024

                                       6
<PAGE>
                                                                     EXHIBIT "E"
                            INDEMNIFICATION AGREEMENT

         THIS INDEMNIFICATION AGREEMENT ("AGREEMENT") is made as of December
____, 2002, by and between SURGICARE, INC., a Delaware corporation
("SurgiCare"), AMERICAN INTERNATIONAL INDUSTRIES, INC., a Nevada corporation
("AII"), ELK INTERNATIONAL CORPORATION, LTD., a Bahamian corporation ("Elk") and
DANIEL DROR ("Dror"). AII, Elk and Dror are collectively referred to as the
"INDEMNITEES".

         WHEREAS, David Blumfield pledged 730,730 shares of Surgicare common
stock ("Pledged Shares") pursuant to a stock pledge agreement entered into on or
about August 12, 2002 ("Pledge Agreement"); and

         WHEREAS, Elk sold a portion of the Pledged Shares; and

         WHEREAS, AII (an affiliate of Elk) and Surgicare are entering into an
agreement dated the date hereof ("Master Agreement"), to which this Agreement is
attached as Exhibit "E"; and

         WHEREAS, SurgiCare and Indemnitees have agreed to enter this Agreement
as part of the consideration given pursuant to the Master Agreement; and

         NOW, THEREFORE, in consideration of the foregoing and with the
understanding on the part of SurgiCare that the Indemnitees are relying on this
Agreement in agreeing to enter into the Master Agreement and for other and
valuable consideration the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

         1. CERTAIN DEFINITIONS. As used in this Agreement, the following
defined terms have the meanings indicated below:

                  "CLAIM" means any threatened, pending or completed civil
         action, suit or proceeding instituted by David Blumfield in connection
         with the Pledged Shares or the Pledge Agreement.

                  "EXPENSES" means all reasonable attorney's fees and all other
         reasonable fees, costs, expenses and obligations paid or incurred in
         connection with investigating, defending or participating, or preparing
         to defend or participate in, any Claim.

                  "LOSS" means any and all damages, judgments, fines, penalties,
         amounts paid or payable in settlement, deficiencies, losses and
         Expenses (including all interest, assessments, and other charges paid
         or payable in connection with or respect of such Losses).

         2. INDEMNIFICATION.

         (a) In the event the Indemnitees is or becomes a party to or other
participant in, or is threatened to be made a party to or other participant in,
a Claim, SurgiCare to the fullest extent permitted by applicable law shall
indemnify and hold harmless the Indemnitee from and against any and all Losses
suffered, incurred or sustained by the Indemnitee or to which the Indemnitee
becomes subject, resulting from, arising out of or relating to such Claim (it
being understood that except as provided in Section 2(c) with respect to
Expenses, reimbursements of any such Losses shall be made as soon as practicable
but in any event no later than 15 days after written request (a "Claim Notice")
is made to SurgiCare accompanied by supporting documentation). The Indemnitee
shall give SurgiCare written notice of any Claim (accompanied by such reasonable
supporting documentation as may be in the Indemnitee's possession) as soon as
practicable after the Indemnitee becomes aware thereof; provided that the
failure

                                                                     PAGE 1 OF 3
<PAGE>

of the Indemnitee to give such notice shall not relieve SurgiCare of its
indemnification obligations under this Agreement, except to the extent that such
failure materially prejudices the rights of SurgiCare.

         (b) In the case of the commencement of any action against the
Indemnitee in respect of which the Indemnitee may seek indemnification from
SurgiCare hereunder, SurgiCare will be entitled to participate therein,
including, without limitation, the negotiation and approval of any settlement of
such action and, to the extent that SurgiCare may wish to assume the defense
thereof, with counsel reasonably satisfactory to the Indemnitee, and after
notice from SurgiCare to the Indemnitee of SurgiCare's election so to assume the
defense thereof, together with SurgiCare's written acknowledgement and agreement
that it will fully indemnify the Indemnitee under the terms of this Agreement
with regard to such Claim, SurgiCare will not be liable to the Indemnitee under
this Agreement for any Expenses subsequently incurred by the Indemnitee in
connection with the defense thereof other than reasonable costs of investigation
and preparation therefor (including, without limitation, appearing as a witness
and reasonable fees and expenses of legal counsel in connection therewith). If
in any action for which indemnity may be sought hereunder SurgiCare shall not
have timely assumed the defense thereof with counsel reasonably satisfactory to
the Indemnitee, or the Indemnitee shall have been advised by counsel that it
would constitute a conflict of interest for the same counsel to represent both
the Indemnitee and SurgiCare in such action, or if the Indemnitee may have
separate or additional defenses with regard to such action, the Indemnitee shall
have the right to employ counsel for the Indemnitee reasonably satisfactory to
SurgiCare in such action, in which event SurgiCare shall reimburse the
Indemnitee for all reasonable legal fees and expenses incurred by the Indemnitee
in connection with the defense thereof. SurgiCare shall in no event be liable
for any settlement of any action effected without its prior written consent
(which consent shall not be unreasonably withheld, delayed and conditioned).
SurgiCare shall not settle any Claim in any manner that would impose any
expense, penalty, obligation or limitation on the Indemnitee, or would contain
language other than a recitation of any amounts to be paid in settlement, the
fact of the settlement or the underlying claim relating to the settlement, that
could be viewed, in the sole discretion of the Indemnitee, as an acknowledgement
of wrongdoing on the part of the Indemnitee or as detrimental to the reputation
of the Indemnitee, without the Indemnitee's prior written consent.

         (c) The Indemnitee's right to indemnification in this Section 2 shall
include the right of the Indemnitee to be advanced by SurgiCare any Expenses
incurred in connection with any Claim as such Expenses are incurred by the
Indemnitee; provided, however, that all amounts advanced in respect of such
Expenses shall be repaid to SurgiCare by the Indemnitee if it shall ultimately
be determined by a court of appropriate jurisdiction or arbitrator that the Loss
arose as a result of the Indemnitee's recklessness or willful misconduct.

         3. PARTIAL INDEMNITY. If the Indemnitees are entitled under any
provision of this Agreement to indemnification by SurgiCare for some or a
portion of any Loss, but not for all of the total amount thereof, SurgiCare
shall nevertheless indemnify the Indemnitees for the portion thereof to which
the Indemnitees are entitled. Moreover, notwithstanding any other provision of
this Agreement, to the extent that the Indemnitees have been successful on the
merits or otherwise in defense of any or all Claims or in defense of any issue
or matter therein, including dismissal without prejudice, the Indemnitees shall
be indemnified against all Expenses incurred in connection therewith.

         4. NONEXCLUSIVITY. The rights of the Indemnitees hereunder shall be in
addition to any other rights the Indemnitees may have under any insurance
policy, corporate law or otherwise.

         5. AMENDMENT, ETC. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by both of the parties
hereto. No waiver of any of the provisions of this Agreement shall be deemed or
shall constitute a waiver of any other provisions hereof (whether or not
similar) nor shall such waiver constitute a continuing waiver.

                                                                     PAGE 2 OF 3
<PAGE>

         6. SUBROGATION. In the event of any payment under this Agreement,
SurgiCare shall be subrogated to the extent of such payment to all of the rights
of recovery of the Indemnitees, and the Indemnitees shall execute all papers
reasonably required and shall take such action that may be reasonably necessary
to secure such rights, including the execution of such documents reasonably
necessary to enable SurgiCare effectively to bring suit to enforce such rights.

         7. NO DUPLICATION OF PAYMENTS. SurgiCare shall not be liable under this
Agreement to make any payment in connection with a Claim made against the
Indemnitees to the extent the Indemnitees have otherwise actually received
payment (under any insurance policy, bylaw or otherwise) of the amounts
otherwise indemnifiable hereunder; PROVIDED that, if the Indemnitee for any
reason is required to disgorge any payment actually received, SurgiCare shall be
obligated to pay such amount to the Indemnitee in accordance with the other
terms of this Agreement (i.e., disregarding the terms of this Section 7).

         8. GOVERNING LAW; VENUE. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas, without giving
effect to principles of conflicts of laws. Venue of any action to enforce this
Agreement will be in Harris County, Texas.

         9. COUNTERPARTS. This Agreement may be executed in one or more
counterparts for the convenience of the parties hereto, all of which together
shall constitute one and the same instrument.

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.

AMERICAN INTERNATIONAL                 SURGICARE, INC.
INDUSTRIES, INC.

By:                                    By:
    --------------------------------      --------------------------------------
    Daniel Dror, President                Keith LeBlanc, Chief Executive Officer

ELK INTERNATIONAL CORPORATION, LTD.

By:
    --------------------------------
Name:
      ------------------------------
Title:
       -----------------------------

DANIEL DROR, INDIVIDUALLY

By:
    --------------------------------
    Daniel Dror, Individually

                                                                     PAGE 3 OF 3
<PAGE>
                                                                     EXHIBIT "F"

                            INDEMNIFICATION AGREEMENT

         THIS INDEMNIFICATION AGREEMENT ("AGREEMENT") is made as of December
____, 2002, by and between AMERICAN INTERNATIONAL INDUSTRIES, INC., a Nevada
corporation ("AII"), and SURGICARE, INC., a Delaware corporation (the
"INDEMNITEE").

         WHEREAS, AII and Indemnitee have entered into an agreement dated the
date hereof ("Master Agreement"), to which this Agreement is Exhibit "F"; and

         WHEREAS, Indemnitee has entered into a finders fee agreement with Sig
Altman dated January 10, 2002, where Sig Altman was entitled to certain fees and
expenses ("Finders Fee Agreement"); and

         NOW, THEREFORE, in consideration of the foregoing and with the
understanding on the part of AII that the Indemnitee is relying on this
Agreement in agreeing to enter into the Master Agreement and for other and
valuable consideration the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

         1. CERTAIN DEFINITIONS. As used in this Agreement, the following
defined terms have the meanings indicated below:

                  "CLAIM" means any threatened, pending or completed civil
         action, suit or proceeding instituted by Sig Altman, or any entity
         controlled by Sig Altman ("Altman"), in which Altman seeks fees and/or
         expenses (in the form of cash, stock, warrants or other security)
         arising out of the Finders Fee Agreement or any other verbal or written
         agreement with Indemnitee or Charles Cohen in excess of the 69,000
         shares of common stock of SurgiCare issued to Altman on or about June,
         2002.

                  "EXPENSES" means all reasonable attorney's fees and all other
         reasonable fees, costs, expenses and obligations paid or incurred in
         connection with investigating, defending or participating, or preparing
         to defend or participate in, any Claim.

                  "LOSS" means any and all damages, judgments, fines, penalties,
         amounts paid or payable in settlement, deficiencies, losses and
         Expenses (including all interest, assessments, and other charges paid
         or payable in connection with or respect of such Losses).

         2. INDEMNIFICATION.

         (a) In the event the Indemnitee is or becomes a party to or other
participant in, or is threatened to be made a party to or other participant in,
a Claim, AII to the fullest extent permitted by applicable law shall indemnify
and hold harmless the Indemnitee from and against any and all Losses suffered,
incurred or sustained by the Indemnitee or to which the Indemnitee becomes
subject, resulting from, arising out of or relating to such Claim (it being
understood that except as provided in Section 2(c) with respect to Expenses,
reimbursements of any such Losses shall be made as soon as practicable but in
any event no later than 15 days after written request (a "Claim Notice") is made
to AII accompanied by supporting documentation). The Indemnitee shall give AII
written notice of any Claim (accompanied by such reasonable supporting
documentation as may be in the Indemnitee's possession) as soon as practicable
after the Indemnitee becomes aware thereof; provided that the failure of the
Indemnitee to give such notice shall not relieve AII of its indemnification
obligations under this Agreement, except to the extent that such failure
materially prejudices the rights of AII.

                                                                     PAGE 1 OF 3
<PAGE>

         (b) In the case of the commencement of any action against the
Indemnitee in respect of which the Indemnitee may seek indemnification from AII
hereunder, AII will be entitled to participate therein, including, without
limitation, the negotiation and approval of any settlement of such action and,
to the extent that AII may wish to assume the defense thereof, with counsel
reasonably satisfactory to the Indemnitee, and after notice from AII to the
Indemnitee of AII's election so to assume the defense thereof, together with
AII's written acknowledgement and agreement that it will fully indemnify the
Indemnitee under the terms of this Agreement with regard to such Claim, AII will
not be liable to the Indemnitee under this Agreement for any Expenses
subsequently incurred by the Indemnitee in connection with the defense thereof
other than reasonable costs of investigation and preparation therefor
(including, without limitation, appearing as a witness and reasonable fees and
expenses of legal counsel in connection therewith). If in any action for which
indemnity may be sought hereunder AII shall not have timely assumed the defense
thereof with counsel reasonably satisfactory to the Indemnitee, or the
Indemnitee shall have been advised by counsel that it would constitute a
conflict of interest for the same counsel to represent both the Indemnitee and
AII in such action, or if the Indemnitee may have separate or additional
defenses with regard to such action, the Indemnitee shall have the right to
employ counsel for the Indemnitee reasonably satisfactory to AII in such action,
in which event AII shall reimburse the Indemnitee for all reasonable legal fees
and expenses incurred by the Indemnitee in connection with the defense thereof.
AII shall in no event be liable for any settlement of any action effected
without its prior written consent (which consent shall not be unreasonably
withheld, delayed and conditioned). AII shall not settle any Claim in any manner
that would impose any expense, penalty, obligation or limitation on the
Indemnitee, or would contain language other than a recitation of any amounts to
be paid in settlement, the fact of the settlement or the underlying claim
relating to the settlement, that could be viewed, in the sole discretion of the
Indemnitee, as an acknowledgement of wrongdoing on the part of the Indemnitee or
as detrimental to the reputation of the Indemnitee, without the Indemnitee's
prior written consent.

         (c) The Indemnitee's right to indemnification in this Section 2 shall
include the right of the Indemnitee to be advanced by AII any Expenses incurred
in connection with any Claim as such Expenses are incurred by the Indemnitee;
provided, however, that all amounts advanced in respect of such Expenses shall
be repaid to AII by the Indemnitee if it shall ultimately be determined by a
court of appropriate jurisdiction or arbitrator that the Loss arose as a result
of the Indemnitee's recklessness or willful misconduct in connection with its
engagement with Altman.

         3. PARTIAL INDEMNITY. If the Indemnitee is entitled under any provision
of this Agreement to indemnification by AII for some or a portion of any Loss,
but not for all of the total amount thereof, AII shall nevertheless indemnify
the Indemnitee for the portion thereof to which the Indemnitee is entitled.
Moreover, notwithstanding any other provision of this Agreement, to the extent
that the Indemnitee has been successful on the merits or otherwise in defense of
any or all Claims or in defense of any issue or matter therein, including
dismissal without prejudice, the Indemnitee shall be indemnified against all
Expenses incurred in connection therewith.

         4. NONEXCLUSIVITY. The rights of the Indemnitee hereunder shall be in
addition to any other rights the Indemnitee may have under any insurance policy,
corporate law or otherwise.

         5. AMENDMENT, ETC. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by both of the parties
hereto. No waiver of any of the provisions of this Agreement shall be deemed or
shall constitute a waiver of any other provisions hereof (whether or not
similar) nor shall such waiver constitute a continuing waiver.

         6. SUBROGATION. In the event of any payment under this Agreement, AII
shall be subrogated to the extent of such payment to all of the rights of
recovery of the Indemnitee, and the Indemnitee shall execute all papers
reasonably required and shall take such action that may be reasonably

                                                                     PAGE 2 OF 3
<PAGE>

necessary to secure such rights, including the execution of such documents
reasonably necessary to enable AII effectively to bring suit to enforce such
rights.

         7. NO DUPLICATION OF PAYMENTS. AII shall not be liable under this
Agreement to make any payment in connection with a Claim made against the
Indemnitee to the extent the Indemnitee has otherwise actually received payment
(under any insurance policy, bylaw or otherwise) of the amounts otherwise
indemnifiable hereunder; PROVIDED that, if the Indemnitee for any reason is
required to disgorge any payment actually received, AII shall be obligated to
pay such amount to the Indemnitee in accordance with the other terms of this
Agreement (i.e., disregarding the terms of this Section 7).

         8. GOVERNING LAW; VENUE. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas, without giving
effect to principles of conflicts of laws. Venue of any action to enforce this
Agreement will be in Harris County, Texas and the parties agree that venue shall
be in federal or state court in Harris County, Texas.

         9. COUNTERPARTS. This Agreement may be executed in one or more
counterparts for the convenience of the parties hereto, all of which together
shall constitute one and the same instrument.

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.

AMERICAN INTERNATIONAL                 SURGICARE, INC.
INDUSTRIES, INC.

By:                                    By:
    --------------------------------      --------------------------------------
    Daniel Dror, President                Keith LeBlanc, Chief Executive Officer

                                                                     PAGE 3 OF 3
<PAGE>

                                                                       EXHIBIT G

                             SUBSCRIPTION AGREEMENT
                                       IN
                                 SURGICARE, INC.

Mr. Phil Scott, Chief Financial Officer
SurgiCare, Inc.
12727 Kimberley, Suite 200
Houston, TX  77024

         1. SUBSCRIPTION. The undersigned (often referred to individually as
"Purchaser" or "Shareholder" or "you") hereby makes application to become an
investor in SurgiCare, Inc., a Delaware corporation ("Company"), and to purchase
2,439,024 Shares at a price of $0.41 per Share.

         2. ACCEPTANCE OF SUBSCRIPTION. It is understood and agreed that the
Company shall have the right, at any time prior to receipt of notice of
cancellation from the undersigned to accept or reject this Subscription
Agreement, in whole or in part, and that the same shall be deemed to be accepted
by the Company only when it is signed by an authorized officer of the Company.

         3. REPRESENTATIONS BY THE UNDERSIGNED. The undersigned represents and
warrants as follows:

                  a.       The undersigned has carefully reviewed and understood
                           this Subscription Agreement, the Company's most
                           recent report filed with the Securities and Exchange
                           Commission ("SEC") on Form 10-QSB for the nine months
                           ended September 30, 2002, all reports filed with the
                           SEC since January 1, 2002 recognizing that the
                           undersigned is only relying on the financial
                           information of the Company as contained in the Form
                           10-QSB for the nine months ended September 30, 2002
                           (collectively, the above documents are referred to as
                           the "Subscription Documents");

                  b.       The undersigned is purchasing the Shares based solely
                           on the Subscription Documents;

                  c.       The undersigned recognizes that the Shares have not
                           been registered under the Securities Act of 1933, as
                           amended ("Act"), nor under the securities laws of any
                           state and, therefore, cannot be resold unless the
                           resale of the Shares is registered under the Act or
                           unless an exemption from registration is available;
                           no public agency has passed upon the accuracy or
                           adequacy of the information contained in the
                           Subscription Documents or the fairness of the terms
                           of the offering;

                  d.       The undersigned is acquiring the Shares for its own
                           account for long-term investment and not with a view
                           toward resale, fractionalization or division, or
                           distribution thereof, and it does not presently have
                           any reason to anticipate any change in its
                           circumstances, financial or otherwise, or particular
                           occasion or event which would necessitate or require
                           his or her sale or distribution of the Shares. No one
                           other than the undersigned has any beneficial
                           interest in said securities;

                                       1
<PAGE>

                  e.       The undersigned understands and acknowledges that the
                           undersigned has no right to require registration of
                           resale of the securities purchased hereby under the
                           Act or under any state securities laws;

                  f.       The undersigned represents it is an Accredited
                           Investor as defined in Regulation D promulgated under
                           the Act.

                  g.       The undersigned recognizes that the total amount of
                           funds tendered to purchase the Shares is placed at
                           the risk of the business and may be completely lost.
                           The undersigned understands that there can be no
                           assurance of profitable operations and the purchase
                           of Shares as an investment involves risks;

                  h.       The undersigned realizes that the Shares cannot
                           readily be sold, that it may not be possible to sell
                           or dispose of the Shares and therefore the Shares
                           must not be purchased unless the undersigned has
                           liquid assets sufficient to assure that such purchase
                           will cause no undue financial difficulties and the
                           undersigned can provide for current needs and
                           possible personal contingencies;

                  i.       The undersigned understands that there are
                           substantial restrictions on the transferability of
                           the Shares, and that any certificate or other
                           document evidencing the Shares will have
                           substantially the following restrictive legend
                           thereon:

                                    "The securities represented by this
                           certificate have been acquired for investment and
                           have not been registered under the Securities Act of
                           1933, as amended ("Act") or the securities laws of
                           any state. Such securities may not be sold, pledged,
                           hypothecated or otherwise transferred at any time
                           except upon registration or upon delivery to the
                           Company of an opinion of counsel satisfactory to the
                           Company that such registration is not required or
                           evidence satisfactory to the Company that any such
                           transfer will not violate the Act or the securities
                           laws of any state."

                  j.       The undersigned has not become aware of the offering
                           of Shares by any form of general solicitation or
                           advertising, including, but not limited to
                           advertisements, articles, notices or other
                           communications published in any newspaper, magazine
                           or other similar media or broadcast over television
                           or radio or any seminar or meeting where those
                           individuals that have attended have been invited by
                           any such or similar means of general solicitation or
                           advertising.

         4. INDEMNIFICATION. It is acknowledged that the meaning and legal
consequences of the representations and warranties contained in this
Subscription Agreement are understood and the undersigned hereby agrees to
indemnify and hold harmless the Company and each officer thereof from and
against any and all loss, damage and liability due to or arising out of a breach
of any of the representations and warranties made in this Subscription
Agreement. The representations and warranties contained herein are intended to
and shall survive delivery of the Subscription Agreement.

         This Subscription Agreement is executed effective on this the ______
day of _______, 200___, in the State of Texas.

                                       2
<PAGE>

INTERNATIONAL DIVERSIFIED CORPORATION, LTD.

By:
    ---------------------------------------
    Elkana Faiwuszewicz, CEO

-------------------------------------------
Please print the exact name (registration)
Investor desires on records of the Company.

-------------------------------------------
Street Address           Suite or Apt.

-------------------------------------------
City,          State            Zip Code

(      )
-------------------------------------------
Telephone

-------------------------------------------
Taxpayer I.D. Number

         ACCEPTED BY THE COMPANY this the _______ day of December, 2002.

SURGICARE, INC.

By:
    ---------------------------------------
    Phillip Scott, Chief Financial Officer

                                       3
<PAGE>

                                                                     EXHIBIT G-1

                             SUBSCRIPTION AGREEMENT
                                       IN
                                 SURGICARE, INC.

Mr. Phil Scott, Chief Financial Officer
SurgiCare, Inc.
12727 Kimberley, Suite 200
Houston, TX  77024

         1. SUBSCRIPTION. The undersigned (often referred to individually as
"Purchaser" or "Shareholder" or "you") hereby makes application to become an
investor in SurgiCare, Inc., a Delaware corporation ("Company"), and to purchase
3,658,537 Shares at a price of $0.41 per Share through a conversion of 300,000
shares of Series AA Redeemable Preferred Stock.

         2. ACCEPTANCE OF SUBSCRIPTION. It is understood and agreed that the
Company shall have the right, at any time prior to receipt of notice of
cancellation from the undersigned to accept or reject this Subscription
Agreement, in whole or in part, and that the same shall be deemed to be accepted
by the Company only when it is signed by an authorized officer of the Company.

         3. REPRESENTATIONS BY THE UNDERSIGNED. The undersigned represents and
warrants as follows:

                  a.       The undersigned has carefully reviewed and understood
                           this Subscription Agreement, the Company's most
                           recent report filed with the Securities and Exchange
                           Commission ("SEC") on Form 10-QSB for the nine months
                           ended September 30, 2002, all reports filed with the
                           SEC since January 1, 2002 recognizing that the
                           undersigned is only relying on the financial
                           information of the Company as contained in the Form
                           10-QSB for the nine months ended September 30, 2002
                           (collectively, the above documents are referred to as
                           the "Subscription Documents");

                  b.       The undersigned is purchasing the Shares based solely
                           on the Subscription Documents;

                  c.       The undersigned recognizes that the Shares have not
                           been registered under the Securities Act of 1933, as
                           amended ("Act"), nor under the securities laws of any
                           state and, therefore, cannot be resold unless the
                           resale of the Shares is registered under the Act or
                           unless an exemption from registration is available;
                           no public agency has passed upon the accuracy or
                           adequacy of the information contained in the
                           Subscription Documents or the fairness of the terms
                           of the offering;

                  d.       The undersigned is acquiring the Shares for its own
                           account for long-term investment and not with a view
                           toward resale, fractionalization or division, or
                           distribution thereof, and it does not presently have
                           any reason to anticipate any change in its
                           circumstances, financial or otherwise, or particular
                           occasion or event which would necessitate or require
                           his or her sale or distribution of the Shares. No one
                           other than the undersigned has any beneficial
                           interest in said securities;

                                       1
<PAGE>

                  e.       The undersigned understands and acknowledges that the
                           undersigned has no right to require registration of
                           resale of the securities purchased hereby under the
                           Act or under any state securities laws;

                  f.       The undersigned represents it is an Accredited
                           Investor as defined in Regulation D promulgated under
                           the Act.

                  g.       The undersigned recognizes that the total amount of
                           funds tendered to purchase the Shares is placed at
                           the risk of the business and may be completely lost.
                           The undersigned understands that there can be no
                           assurance of profitable operations and the purchase
                           of Shares as an investment involves risks;

                  h.       The undersigned realizes that the Shares cannot
                           readily be sold, that it may not be possible to sell
                           or dispose of the Shares and therefore the Shares
                           must not be purchased unless the undersigned has
                           liquid assets sufficient to assure that such purchase
                           will cause no undue financial difficulties and the
                           undersigned can provide for current needs and
                           possible personal contingencies;

                  i.       The undersigned understands that there are
                           substantial restrictions on the transferability of
                           the Shares, and that any certificate or other
                           document evidencing the Shares will have
                           substantially the following restrictive legend
                           thereon:

                                    "The securities represented by this
                           certificate have been acquired for investment and
                           have not been registered under the Securities Act of
                           1933, as amended ("Act") or the securities laws of
                           any state. Such securities may not be sold, pledged,
                           hypothecated or otherwise transferred at any time
                           except upon registration or upon delivery to the
                           Company of an opinion of counsel satisfactory to the
                           Company that such registration is not required or
                           evidence satisfactory to the Company that any such
                           transfer will not violate the Act or the securities
                           laws of any state."

                  j.       The undersigned has not become aware of the offering
                           of Shares by any form of general solicitation or
                           advertising, including, but not limited to
                           advertisements, articles, notices or other
                           communications published in any newspaper, magazine
                           or other similar media or broadcast over television
                           or radio or any seminar or meeting where those
                           individuals that have attended have been invited by
                           any such or similar means of general solicitation or
                           advertising.

         4. INDEMNIFICATION. It is acknowledged that the meaning and legal
consequences of the representations and warranties contained in this
Subscription Agreement are understood and the undersigned hereby agrees to
indemnify and hold harmless the Company and each officer thereof from and
against any and all loss, damage and liability due to or arising out of a breach
of any of the representations and warranties made in this Subscription
Agreement. The representations and warranties contained herein are intended to
and shall survive delivery of the Subscription Agreement.

         This Subscription Agreement is executed effective on this the ______
day of _______, 200___, in the State of Texas.

                                       2
<PAGE>

AMERICAN INTERNATIONAL INDUSTRIES, INC.

By:_____________________________
      Daniel Dror, CEO

-----------------------------------------------
Please print the exact name (registration)
Investor desires on records of the Company.

-----------------------------------------------
Street Address             Suite or Apt.

-----------------------------------------------
City,             State          Zip Code

(       )
-----------------------------------------------
Telephone

-----------------------------------------------
Taxpayer I.D. Number

         ACCEPTED BY THE COMPANY this the _______ day of December, 2002.

SURGICARE, INC.

By:
    -------------------------------------------
    Phillip Scott, Chief Financial Officer

                                       3
<PAGE>

                                                                     EXHIBIT "H"

                                IRREVOCABLE PROXY
                                       OF
                        AMERICAN INTERNATIONAL INDUSTRIES

Name of Issuer: Surgicare, Inc.
                ---------------------------------

Common Stock Certificate Nos.:
                               ------------------

Number of Shares of Common Stock:
                                  ---------------

I, Daniel Dror, as President and Chairman of the Board of Directors of American
International Industries (the "Company"), as holder of the shares described
above, revoke any previously executed proxies and appoint Keith LeBlanc as my
proxy to attend shareholders' meetings, vote, execute consents, and otherwise
act for me in the same manner and with the same effect as if the Company was
personally present until December _____, 2003. Until that time, this proxy shall
be irrevocable unless terminated by mutual agreement of the parties.

This proxy is irrevocable and is made and executed pursuant to an agreement
between American International Industries, Inc., Texas Real Estate Enterprises,
Inc., MidCity Houston Properties, Inc., Daniel Dror and SurgiCare, Inc. dated
the date hereof ("Agreement"), to which this proxy is Exhibit "H". The shares
described above were sold and issued to the Company in connection with the
Agreement and this proxy is given as part of the Agreement.

Dated:   December ___, 2002

By:
   ----------------------------------
   Daniel Dror, President

<PAGE>

                                                                   EXHIBIT "H-2"

                                IRREVOCABLE PROXY
                                       OF
                   INTERNATIONAL DIVERSIFIED CORPORATION, LTD.

Name of Issuer: Surgicare, Inc.
                ------------------------------

Common Stock Certificate Nos.:
                               ---------------

Number of Shares of Common Stock:
                                  ------------

I, Elkana Faiwuszewicz, as President of International Diversified Corporation,
Ltd. (the "Company"), as holder of the shares described above, revoke any
previously executed proxies and appoint Keith LeBlanc as my proxy to attend
shareholders' meetings, vote, execute consents, and otherwise act for me in the
same manner and with the same effect as if the Company was personally present
until December 31, 2003. Until that time, this proxy shall be irrevocable unless
terminated by mutual agreement of the parties.

This proxy is irrevocable and is made and executed pursuant to an agreement
between American International Industries, Inc., Texas Real Estate Enterprises,
Inc., MidCity Houston Properties, Inc., Daniel Dror and SurgiCare, Inc. dated
the date hereof ("Agreement"), to which this proxy is Exhibit "H-2". The shares
described above were sold and issued to the Company in connection with the
Agreement and this proxy is given as part of the Agreement.

Dated:  December ___, 2002

By:
    ------------------------------------
    Elkana Faiwuszewicz, President

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