Document:

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                                                                    EXHIBIT 10.9

                              M I C R 0 P H A S E
                             C 0 R P 0 R A T I 0 N

                               Microphase/mPhase
                               -----------------

                         FACILITIES/SERVICES AGREEMENT
                         -----------------------------

This agreement is made effective this 1st day of July, 1998 between Microphase
Corporation, a Connecticut Corporation having a place of business at 587
Connecticut Avenue, Norwalk, CT. 06854-0960 (referred to as "Microphase") and
mPhase Technologies, Incorporated, a Delaware Corporation, having a place of
business at 587 Connecticut Avenue, Norwalk, CT. 06854-0960 (referred to as
"mPhase").

     WHEREAS, in order to facilitate the initiation of operation of mPhase, the
Parties wish to take advantage of certain facilities and services available at
Microphase;

     NOW, THEREFORE, the Parties agree as follows:

1.   Microphase hereby makes available to mPhase, the use of general office
     space.

2.   Microphase hereby agrees to provide general administrative services,
     including maintaining an independent accounting function for mPhase
     Technologies, Inc.

3.   mPhase shall employ separate and independent auditors to review quarterly,
     and audit the annual financial statement.

4.   mPhase shall pay to Microphase the sum of $50,000.00 on a month to month
     basis composed of ($10,000.00 Facilities fee and $40,000.00 Engineering
     fee), during the term of this agreement.
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                              M I C R 0 P H A S E
                             C 0 R P 0 R A T I 0 N

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly
executed as of the day and year first above written.

Microphase Corporation:

By:
   ---------------------------------
Name:  Torry Guardino
Title: Contract Administrator
Date:
     -------------------------------

mPhase Technologies, Inc.

By:
   ---------------------------------
Name:  Gustave T. Dotoli
Title: Executive Vice President
Date:
     -------------------------------<PAGE>

                                                                   EXHIBIT 10.12

                             ASSIGNMENT AGREEMENT

THIS AGREEMENT IS MADE AND ENTERED INTO BY MICROPHASE CORPORATION, HAVING ITS
PRINCIPAL PLACE OF BUSINESS AT 587 CONNECTICUT AVENUE, NORWALK, CONNECTICUT
06854, A CONNECTICUT CORPORATION, HEREINAFTER REFERRED TO AS "ASSIGNOR", AND
LIGHTPATHS, INC., A DELAWARE CORPORATION, HAVING ITS PRINCIPAL PLACE OF BUSINESS
AT 587 CONNECTICUT AVENUE, NORWALK, CONNECTICUT 06854, HEREINAFTER REFERRED TO
AS "ASSIGNEE".

WHEREAS GlobeSpan Technologies Inc., a Delaware corporation with offices at 100
Schulz Drive, Red Bank, NJ 07701, ("GTI') and ASSIGNOR have previously entered
into a GLOBESPAN DSL TECHNOLOGY LICENSE AGREEMENT (the "LICENSE AGREEMENT) and

WHEREAS ASSIGNOR wishes to assign its rights, duties and obligations under the
LICENSE AGREEMENT to ASSIGNEE and

WHEREAS ASSIGNEE wishes to accept such assignment of the rights, duties and
obligations under the LICENSE AGREEMENT,

THEREFORE the above parties agree that the following mutual promises and
covenants shall govern the assignment by ASSIGNOR and the acceptance of such
assignment by ASSIGNEE:

1.   ASSIGNOR hereby assigns to ASSIGNEE, and ASSIGNEE hereby accepts,
     ASSIGNOR's right to develop, manufacture, market, use and sell Manufactured
     Products which may be developed from the GLOBESPAN DSL TRANSCEIVER
     TECHNOLOGY, and the right to purchase Product and the obligation to pay for
     such Product, and all other rights, duties and obligations under the
     provisions of the LICENSE AGREEMENT, a copy of which is attached hereto and
     made a part of this Agreement as Exhibit A.

2.   ASSIGNOR warrants that it is not in default under the AGREEMENTS and that
     ASSIGNOR has not assigned or pledged, and will not assign or pledge, the
     whole or any part of the rights and obligations thereunder to anyone other
     than ASSIGNEE.

3.   In the event ASSIGNEE defaults on any of the terms, conditions, or payments
     due under the LICENSE AGREEMENT or otherwise fails to meet any of its
     duties or obligations thereof; then ASSIGNOR agrees that it shall remain
     liable to GTI for the fulfillment of such terms, conditions, payments,
     duties or obligations to include, but not limited to, provisions for
     damages and/or indemnification for Infringement, property damage or
     personal injury.
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4.   No amendment, modification or waiver of any provision of this Assignment
     Agreement shall be effective unless in writing and signed by all panics
     hereto.

5.   The effective dale of the Assignment under this Agreement shall be February
     1, 1997.

6.  SIGNATURE

IN WITNESS WHEREOF. the parties hereto have executed this Agreement on the
dates set forth below.

ASSIGNOR                            ASSIGNEE

-------------------------           -------------------------
Print or Type Name                  Print or Type Name

Title:  Chief Contracting Officer   Title:  Vice President
        -------------------------           --------------

Date        2/17/97                 Date:  2/17/97
    ---------------                      ---------

Consent to Assignment:
GlobeSpan Technologies Inc. hereby grants its approval for the assignment of the
LICENSE AGREEMENT subject to and under the provisions of this Agreement and
Section 10.0 of the LICENSE AGREEMENT. No waiver of the requirement to obtain
GTI's approval for future assignments is either granted or intended by this
approval.

GLOBESPAN TECHNOLOGIES INC.

By:
    ------------------------

----------------------------
Print or Type Name

Title:
      ------------------------

Date:
      -----------------

                                      -2-<PAGE>

                                                                    Exhibit 10.9

                       STOCK PURCHASE AND SALE AGREEMENT
                       ---------------------------------

     THIS STOCK PURCHASE AND SALE AGREEMENT (together with any schedules,
exhibits and attachments, collectively, the "Agreement") is made and entered
into this 30th day of March, 2001, by and between PAYROLL COMPANY, INC., a
corporation organized under the laws of the State of Tennessee whose address is
1321 Murfreesboro Road, Suite 100, Nashville, Tennessee 37217, ATTN: Michael
Dobbs ("Buyer"); and CONCORD EFS, INC., a corporation organized under the laws
of the State of Delaware whose address is 2525 Horizon Lake Dr., Memphis,
Tennessee 38133, ATTN: Marcia Heister, Esq. ("Seller").

                             W I T N E S S E T H:

     WHEREAS, Buyer desires to acquire from Seller, and Seller desires to sell
to Buyer, all of the issued and outstanding common stock of Pay Systems of
America, Inc., a Tennessee corporation, as defined in Section 2.1, on the terms,
conditions and provisions set forth in this Agreement.

     NOW, THEREFORE, in consideration of the foregoing premises and the mutual
agreements, covenants, representations and warranties hereinafter set forth, the
receipt and sufficiency of which is hereby acknowledged, and intending to be
legally bound, Seller and Buyer hereby agree as follows:

                                   ARTICLE 1

                                 CLOSING DATE
                                 ------------

     1.1   The purchase and sale of the Stock will be consummated at 2 p.m.,
CST, on March 30, 2001 ("Closing"). The Closing will be held at the offices of
Wyatt, Tarrant & Combs, LLP, 1715 Aaron Brenner Drive, Suite 800, Memphis,
Tennessee 38120 or at such other location as Buyer and Seller may agree. The
date and time of the Closing is hereinafter called the "Closing Date."

                                       1
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     1.2   Seller and Buyer shall use their best efforts, good faith and due
diligence to promptly satisfy all conditions to the respective obligations of
the parties hereto in order to consummate the transactions contemplated by this
Agreement on or before the Closing Date, or, if the parties are unable after
using such best efforts to close on such date, to close as soon thereafter as is
reasonably practicable.

                                   ARTICLE 2

                                   THE STOCK
                                   ---------

     2.1   Subject to the fulfillment of the conditions specified herein, at the
Closing Seller shall sell, convey, assign, transfer and deliver to Buyer and
Buyer shall purchase, receive and assume from Seller all of Seller's right,
title and interest in and to all of the issued and outstanding common stock of
Pay Systems of America, Inc., a Tennessee corporation ("PSA"), to-wit:
Certificate No. 21, for 100 shares , no par value, issued December 12, 1997, in
the name of the Seller ("Stock"). The Stock shall be conveyed by Seller free and
clear of all mortgages, liens, charges, claims, and encumbrances, security
interests, and rights of other persons of any nature whatsoever.

                                   ARTICLE 3

                         PURCHASE PRICE AND ALLOCATION
                         -----------------------------

     Purchase Price. The aggregate purchase price ( "Purchase Price") for the
     --------------
Stock shall be TWO MILLION TWO HUNDRED THOUSAND and NO/100 DOLLARS
($2,200,000.00), payable by Buyer to Seller as follows:

     3.1   At the Closing, Buyer shall pay to Seller in collected funds, the sum
           of $800,000.00;

     3.2   At the Closing, Buyer shall deliver to Seller Buyer's full recourse
           promissory note in the face amount of $1,400,000.00 ("Deferred
           Purchase Price") in the form and

                                       2
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           content set forth in Exhibit "A" attached hereto ("Buyer's Note").
           The Deferred Purchase Price shall bear interest at six percent (6%)
           per annum. Accrued but unpaid interest shall be payable, unless
           sooner matured, on the same day and date as the principal
           installments next provided. Principal shall be payable in two (2)
           annual installments of $700,000.00 each. Payment of the Deferred
           Purchase Price shall be unconditionally guaranteed by Douglas C.
           Altenbern pursuant to a written guaranty agreement the form and
           content of which is attached as Exhibit "B" attached hereto.

     Absent adverse financial consequences to Seller, with respect to the
acquisition of the Stock, Buyer shall have the option to make a timely election
under Section 338(g) of the Internal Revenue Code of 1986 ("Code") and, if
requested by Buyer, Seller and Buyer shall jointly make an election under
Section 338(h)(10) of the Code (and any corresponding elections under state or
local tax law) (collectively, a "Section 338(h)(10) Election"). Seller and Buyer
shall (i) take, and cooperate with each other to take, all actions necessary and
appropriate (including filing such forms, returns, elections schedules and other
documents as may be required) to effect and preserve a timely Section 338(h)(10)
Election in accordance with Section 338 of the Code and the Temporary Regulation
thereunder, or any successor provisions as promptly as practicable following the
Closing Date, but not later than the date which is the latest date for making
such Section 338(h)(10) Election, and from time to time thereafter, and (ii) if
such election is made, Seller and Buyer shall report the sale of the Shares
pursuant to this Agreement consistent with the Section 338(h)(10) Election and
shall take no position contrary thereto or inconsistent therewith in any Tax
Return, any discussion with or proceeding before any taxing authority, or
otherwise. In the event of adverse financial consequences

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to Seller, Buyer may make such Section 338(h)(10) Election, but Buyer shall make
Seller whole in respect of the adverse financial consequences.

                                   ARTICLE 4

              REPRESENTATIONS WITH RESPECT TO UNREGISTERED STOCK
              --------------------------------------------------

         Buyer represents and undertake that:

         4.1   Buyer is acquiring the Stock for its own account and not with a
               view to their distribution within the meaning of Section 2(11) of
               the Securities Act of 1933, as amended, (the "1933 Act") and the
               rules and regulations thereunder. None of the Stock will be
               transferred by or through any shareholder of Buyer in violation
               of the 1933 Act or any state securities laws. Buyer will
               indemnify Seller against any loss, liability or expense
               (including reasonable attorneys' fees and out-of-pocket expenses)
               incurred by Seller by reason of any breach by Buyer or any
               shareholder of Buyer of this Section 4.1.

         4.2   Buyer understands and acknowledges that Stock has not been
               registered under either the 1933 Act or any state securities laws
               and is being offered pursuant to exemptions under such laws.
               Buyer further understands that the Stock cannot be resold or
               otherwise transferred unless such shares are registered under the
               1933 Act and any applicable state securities laws or unless
               exemptions from registration are available.

         4.3   Buyer understands and acknowledges that the sale, transfer,
               pledge, distribution or any other disposition of Stock will be
               restricted.

         4.4   Buyer understands that Buyer must bear the economic risk of
               investment in the Stock for an indefinite period of time because
               such shares have not been registered with the

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               SEC under the 1933 Act or any state securities laws and,
               therefore, cannot be sold unless they are subsequently registered
               under the 1933 Act or any state securities laws or an exemption
               from registration is available.

                                   ARTICLE 5

               REPRESENTATIONS AND WARRANTIES OF SELLER AND PSA
               ------------------------------------------------

Seller and PSA, as applicable, represents and warrants as follows:

     5.1   Organization. Seller is a corporation duly organized, validly
           ------------
existing and in good standing under the laws of the state of Delaware, has the
corporate power to own and sell its properties and to carry on its business as
it is now being conducted and is duly qualified to do business and is in good
standing in every jurisdiction where qualification is necessary for the
operation of its business. PSA is a corporation duly organized, validly existing
and in good standing under the laws of the state of Tennessee, has the corporate
power to own and sell its properties and to carry on its business as it is now
being conducted and is duly qualified to do business and is in good standing in
every jurisdiction where qualification is necessary for the operation of its
business. Seller certifies that the Articles of Incorporation and Bylaws of PSA
furnished to Buyer pursuant to Section 9.1 hereof are true and correct of the
Closing Date. The business of PSA is being and has been operated in all respects
in compliance with the Articles of Incorporation and Bylaws of PSA.

     5.2   Authority Relative to Agreement. Seller has all requisite corporate
           -------------------------------
power and authority to enter into this Agreement and to carry out its
obligations hereunder. This Agreement constitutes a legal, valid and binding
obligation of Seller enforceable against Seller according to its terms, except
as may be limited by applicable bankruptcy, insolvency or other similar laws
affecting

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the rights of creditors generally or equitable principles relating to the
granting of extraordinary remedies.

     The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby have been duly authorized
by the Board of Directors of Seller, and no other corporate proceedings on the
part of Seller are necessary to authorize this Agreement and the transactions
contemplated hereby. Neither the execution and delivery of this Agreement by
Seller, the consummation by Seller of the transactions contemplated hereby, nor
the compliance by Seller with the terms and provisions of this Agreement will
conflict with, violate or result in a breach of any of the terms, conditions or
provisions of the Articles of Incorporation, by-laws, resolutions or authorities
of Seller, or any statute, judgment, order, injunction, decree, regulation or
ruling of any court or governmental authority to which Seller is subject. The
consummation of the transactions contemplated by this Agreement will not result
in a breach of any agreement, contract, or commitment of Seller or constitute a
default thereunder, or, with respect to any agreement, contract or commitment,
give to others any rights or termination, cancellation or acceleration
thereunder, and no indenture, instrument, agreement, contract or commitment to
which Seller is a party will be violated or breached so as to prevent such
consummation.

     No authorization, consent or approval of, or filing with, any public body
or authority is or will be necessary for the execution, delivery or the
performance of this Agreement by Seller or the consummation by Seller of the
transactions contemplated by this Agreement, and the failure of the Seller to
obtain such authorization, consent or approval from any public body or
authority, if required, will not prevent the consummation by Seller of the
transactions contemplated by this Agreement.

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     5.3   Financial Statements. Seller has furnished Buyer with copies of PSA's
           --------------------
balance sheet and statement of income and expense (each being internally
prepared) for the twelve (12) months ending December 31, 2000 and for the stub
period ending February 28, 2001("Financial Statements").

     The Financial Statements (a) are based on the books and records of PSA, (b)
represent fairly and accurately the financial position of PSA as of the date
indicated and the results of operations for the respective periods indicated,
and (c) have been prepared in accordance with generally accepted accounting
principles consistently applied. PSA has no liabilities or obligations of any
nature (whether know or unknown and whether absolute, accrued, contingent or
otherwise) except for liabilities or obligations reflected or reserved against
in the Financial Statements and current liabilities incurred in the ordinary
course of business since the respective dates thereof.

     5.4   Stock Title. Seller has good and marketable title to the Stock, free
           -----------
and clear of any lien, claim, encumbrance, security interest or rights of third
parties. The Stock represents all of the issued and outstanding stock of PSA,
whether common, preferred or otherwise, and the Stock is fully paid and non-
assessable. Except as otherwise set forth in this Agreement, there are no
contracts related to the issuance, sale or transfer of any stock or other
securities of PSA. None of the outstanding shares or other securities of PSA
were issued in violation of the 1933 Act or any federal, state, local or
municipal administrative order, constitution, law, ordinance, principle of
common law, regulation or state statute.

     5.5   Insurance. Insurance coverages shall be maintained by PSA through the
           ---------
Closing Date in amounts which are deemed to be adequate by Seller and PSA, which
provide coverage in accordance with industry norms. All of the policies of
insurance are currently in force, and there has

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been no failure to give any notice or to present any claim under any such
insurance policy when due and in a timely fashion.

     5.6   Trademarks, Copyrights, Etc. PSA owns, free and clear of any lien,
           ----------------------------
claim, encumbrance, security interest or rights of third parties, all United
States and foreign trademarks (registered and common law), trademark
applications, service marks, trade names, and copyrights (collectively,
"Intellectual Property") indicated on its Financial Statements, and (b) licenses
and other agreements (including, but not limited to, any agreements,
undertakings or priority declarations of a restrictive nature with any third
person or entity) relating to Intellectual Property, copies of which have been
delivered to Buyer. The Intellectual Property includes and consists of all such
property described therein that is necessary for the operation of PSA's business
as it is currently conducted. In connection with the deliveries required by this
Section, Seller shall provide, or cause PSA to provide, to Buyer (i) for each
trademark, a statement reciting the trademark application serial number or the
trademark registration number, the trademark class of services covered (based on
the International classification of goods and services), the specific services
covered and the trademark expiration date for each country in which a trademark
has been registered, (ii) for each common law trademark, the information
equivalent to that required to be provided to Buyer under clause (i) immediately
above, (iii) for each service mark, a statement reciting the service mark serial
number or the service mark registration number, the service covered and the
service mark expiration date for each country in which a service mark has been
registered, and (iv) for each copyright, a statement reciting the copyright
registration number and the copyright expiration date for each country in which
a copyright has been registered.

                                       8
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     PSA is the absolute owner (or licensee, as applicable) of the Intellectual
Property, together with the goodwill of the business connected with the use of
and symbolized by same. None of the Intellectual Property is involved in any
pending or threatened lawsuits or administrative actions in the United Stated of
America or in any other country. Neither Seller nor PSA has received any notice
of invalidity or infringement of or conflict with the rights of others with
respect to such Intellectual Property. Seller and PSA have taken all necessary,
reasonable and prudent steps to protect the Intellectual Property from
infringement by any other firm, corporation, association or person. To the best
of Seller's and PSA's knowledge, no other firm, corporation, association or
person (a) has the right to use any such Intellectual Property in commerce
within the United States of America and in any of the other jurisdictions of
registration or use on the services on which they are now being used either in
identical form or in such near resemblance thereto as to be likely, when applied
to the services of any such firm, corporation, association or person, to cause
confusion with Seller's trademarks or to cause a mistake or to deceive, (b) is
claiming any ownership of or right to use such Intellectual Property, or (c) is
infringing upon any such Intellectual Property in any way. PSA is not, to the
best of PSA's knowledge, infringing any trademark, service mark, trade name or
copyright in the United States or any other country.

     5.7   Labor Relations. Seller and PSA have delivered to Buyer a list of all
           ---------------
persons receiving compensation from PSA (either directly or indirectly) in
connection with the business of PSA and a description of all compensation
arrangements affecting each of them. PSA has complied with all applicable laws,
rules and regulations relating to the employment of labor, including, but not
limited to, those relating to wages, hours, health and safety, unfair labor
practices, discrimination and payment of social security and all employment
related taxes. Neither Seller nor PSA has incurred any

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liability for any arrears of wages or any tax penalty for failure to comply with
any of the foregoing. As of the date hereof there are no controversies pending
or threatened between PSA and any of its employees. There is no union campaign
or organizational activity being conducted to solicit cards from PSA's employees
to authorize a labor union to request a National Labor Relations Board
certification election with respect to any PSA employees. Neither the execution
of this Agreement nor the consummation of the transactions contemplated hereby
will cause Buyer, on or after the Closing Date, to assume, maintain or be
responsible for any of the foregoing or any relationship or contracts with any
group of PSA's employees or any labor organization.

     To the knowledge of PSA and Seller, no employee or director of PSA is a
party to is otherwise bound by any agreement or arrangement, including any
confidentiality, non-competition or proprietary rights agreement between such
employee or director and any other person ("Proprietary Rights Agreement") that
in any way adversely affect or will affect: (i) the performance of his or her
duties as an employee or director of PSA, or (ii) the ability of PSA to conduct
its business, including any Proprietary Rights Agreement with PSA by any such
employee or director. To PSA's knowledge, no director, officer or management
employee of PSA has given notice, whether written or oral, to PSA's personnel
office to terminate his or her employment with PSA.

     5.8   Employee Benefit Plans. Seller and PSA have delivered to Buyer copies
           ----------------------
of all (a) employee pension or welfare benefit plans, as defined in Article 3 of
ERISA, and any trust related thereto that are maintained by or for PSA and its
employees or to which PSA contributes, has contributed or to which PSA is
obligated to contribute (by contract or otherwise) on behalf of its employees or
other persons, (b) deferred compensation, bonus, employee stock plan or other
such arrangements or commitments, that are maintained by or for PSA and its
employees or to which

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Seller contributes, has contributed or to which PSA is obligated to contribute
(by contract or otherwise) on behalf of its employees or other persons, and (c)
any determination letters issued by the Internal Revenue Service or the Pension
Benefit Guaranty Corporation relating to (a) or (b) above.

     With regard to any employee benefit plans maintained by PSA, and with
regard to any employee benefit plan which is not maintained by PSA but to which
PSA contributes or is required to contribute (by contract or otherwise), the
execution and delivery of this Agreement by Seller and PSA and the consummation
of the transactions contemplated hereby do not constitute and will not result in
any "prohibited transaction" within the meaning of the ERISA or Article 4975 of
the Internal Revenue Code, as amended (the "Code"). PSA has not incurred any
liability to the Pension Benefit Guaranty Corporation. Neither any of the
benefit plans for employees currently maintained by PSA nor any trust or trusts
thereunder, and any of the foregoing not maintained by PSA but to which PSA
contributes or is required to contribute (by contract or otherwise), have been
terminated or have incurred any "accumulated funding deficiency," as such term
is defined in Article 302 of ERISA or Article 412 of the Code (whether or not
waived), nor have there been any unreported "reportable events," as such term is
defined in Article 4043 of ERISA, with respect thereto, since the effective date
of ERISA, nor do any such plans or trusts maintained by PSA or any such plans or
trusts not maintained by PSA but to which PSA contributes or is required to
contribute (by contract or otherwise) have any liability for unfunded vested
accrued benefits. Any PSA benefit plans or any trust or trusts related thereto
which have been terminated have been terminated in accordance with all
applicable laws and regulations and have not incurred any "accumulated funding
deficiency." Neither execution of this Agreement nor the consummation of the
transactions contemplated hereby will

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cause Buyer to be responsible for any obligation or liability (with respect to
accrued benefits or otherwise) to any employee of PSA or to the Pension Benefit
Guaranty Corporation in respect of any such plans and agreements or any trust or
trusts thereunder, including any such plans, agreements or trusts which have
been terminated prior to the date hereof.

     5.9  Litigation. This Section briefly describes all actions, suits,
          ----------
proceedings, claims, complaints, and investigations pending or threatened
against PSA at law or in equity and before or by any federal, state, foreign or
other governmental body or any arbitration board in the United States of America
or anywhere else, or any claims or complaints made before or to any governmental
entity, to-wit:

     Complainants concerning payroll services provided by PSA to R.M.D.
     Corporation, a corporation with offices in Kentucky, and their affiliated
     restaurants (collectively, "RMD Corporation") have arisen from RMD
     Corporation. Controversy centers around payroll reporting for wage and hour
     employees.

     There are no judgments, orders, injunctions or decrees entered against PSA
which do or will limit, restrict or regulate its business in any respect. Except
as set forth in this Section 5.9, to PSA's and Seller's knowledge, there is no
material pending actions, suits, proceedings, claims, complaints or
investigations pending, nor have such been threatened and in no event has any
matter occurred or circumstances exist that may give rise to or serve as a basis
for the commencement of any such actions.

     Except as set forth in this Section 5.9, the relationship of PSA with its
customers is, to PSA's and Seller's knowledge, satisfactory and neither PSA nor
Seller has received any notice of any intention to terminate or adversely modify
any material term with respect to such relationship.

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<PAGE>

     5.10 Compliance with Laws. The business of PSA is being and has been
          --------------------
operated in all respects in compliance with all applicable laws, rules,
regulations and policies. PSA has filed in a timely fashion all reports with
respect to its business which are required by law and has paid all amounts which
may be due with respect thereto or thereunder. PSA has not been notified by any
regulatory authority that it was or is in violation of any statute, ordinance,
regulation or order, which has application to its business, and, to the best of
PSA's knowledge, there is no violation of any such law, ordinance, regulation or
order which would result in any obligation, loss or expense to PSA or to Buyer
from and after the Closing Date. All governmental licenses and permits necessary
to the conduct of PSA's business are in force and effect and no unresolved
violations are or have been recorded with respect to any such license or permit,
and no proceeding is pending or threatened to revoke or limit any license or
permit. There are no inspection reports or similar communications issued or
released by any federal, state or local governmental agency in the United States
(and by any foreign governmental agency) relating to the business or properties
of PSA and which asserts a deficiency not yet corrected or a matter still in
dispute. Neither Seller nor PSA is aware of any proposed law, regulation, order
or guideline which would cause the business of PSA to be conducted in a
different manner than it is currently conducted by PSA.

     5.11 Delivery of Services. The services sold by PSA and its delivery
          --------------------
systems are in accordance with all applicable laws and regulations, including,
but not limited to, the laws and regulations of the laws of the jurisdictions in
which such services are performed and delivery systems are maintained. Neither
the services performed nor the delivery systems maintained are considered to be
hazardous, harmful or are regulated by the Environmental Protection Agency
("EPA") or

                                       13
<PAGE>

Occupational Health and Safety Administration ("OSHA") or are harmful to the
health and safety of PSA's employees.

     5.12 Conduct of Business. PSA has not done or agreed to do any of the
          -------------------
following: (a) incur, assume, guarantee or become subject to or surety on any
indebtedness or obligation relating to any lending or borrowing or any other
liability or commitment, except current liabilities and commitments incurred in
the ordinary course of business; (b) pay any obligation or liability other than
(i) in the ordinary course of business, (ii) current liabilities reflected or
disclosed in the Financial Statements, or (iii) current liabilities incurred in
the ordinary course of business since January 1, 2001; (c) enter into any
contact or transaction other than in the ordinary course of business; (d)
introduce any new or changed method of management, compensation, employee
benefits, personnel, operation or accounting with respect to its business or any
of the properties or rights applicable thereto; (e) conduct its business other
than in the ordinary course consistent with past practices including the
production, promotion and sale of services; (f) merge or consolidate with any
other corporation or acquire all or substantially all of the stock or business
or assets of any other person, firm, association, corporation or business
organization, or agree to do any of the foregoing; (g) sell, encumber, assign or
transfer any Intellectual Property; or (h) except for rights related to this
Agreement, waive any contractual right.

     Except as expressly permitted by this Agreement, between the date hereof
and the Closing Date, PSA shall not, without the prior written disclosure to and
written consent of Buyer, do any of the matters listed in the preceding
paragraph of this Section.

     5.13 Accounts Receivable. The amounts which have been or will be shown for
          -------------------
accounts receivable and allowances therefore on the Financial Statements and on
the books and records of PSA

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<PAGE>

as of the Closing, have been and will be determined as individual line items in
accordance with generally accepted accounting principles consistently applied.
All accounts receivable shown on the Financial Statements arose in the normal
course of business and, to the knowledge of Seller and PSA, are not subject to
any counterclaims or setoffs.

     5.14 Disclosure. The information contained in the Schedules and documents
          ----------
delivered to Buyer pursuant to this Agreement does not contain any untrue
statement of a fact, or omit to state a fact necessary to make the statements
contained therein not misleading. Notwithstanding the provisions of this
Section, no error or omission in any Schedule or document delivered pursuant to
this Agreement shall be deemed to violate this Section, if such error or
omission is corrected and disclosed in writing specifically as the correction of
an error or the disclosure of an omission in any subsequent document delivered
to Buyer in accordance with this Section at least fifteen (15) days prior to the
Closing Date and which is not objected to by Buyer within ten (10) days of
Buyer's receipt thereof.

                                  ARTICLE 6

                           REPRESENTATIONS OF BUYER
                           ------------------------

     Buyer represents and warrants as follows:

     6.1  Organization and Qualification. Buyer is a corporation duly organized,
          ------------------------------
validly existing and in good standing under the laws of the state of Tennessee
and has all requisite corporate power and authority to enter into and carry out
its obligations hereunder. This Agreement constitutes a legal, valid and binding
obligation of Buyer enforceable against it according to its terms, except as may
be limited to applicable bankruptcy, insolvency or other similar laws affecting
the rights of creditors generally or equitable principles relating to the
granting of extraordinary remedies. The

                                       15
<PAGE>

execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated hereby have been duly authorized by the governing
bodies and other similar authorities of Buyer, and no other proceedings on its
part are necessary to authorize this Agreement and the transactions contemplated
hereby. None of the execution and delivery of this Agreement by Buyer, the
consummation by Buyer of the transactions contemplated hereby or the compliance
by Buyer with the terms and provisions hereof, will conflict with or result in
the breach of any of the terms, conditions or provisions of the organizational
or other governing agreements, documents or instruments or other similar
authorities of Buyer or of any statute, judgment, order, injunction, decree,
regulation or ruling of any court of governmental authority to which Buyer is
subject. No indenture, instrument, agreement, contract or commitment to which
Buyer is a party will be violated or breached so as to prevent the execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby. No authorization, consent or approval of, or filing with, any public
body or authority is necessary for the consummation by Buyer of the transactions
contemplated by this Agreement.

                                  ARTICLE 7

                     ADDITIONAL AGREEMENTS BY THE PARTIES
                     ------------------------------------

     7.1  Consents. Each party agrees to use its best efforts, good faith and
          --------
due diligence to obtain, prior to the Closing Date, any consents required to
consummate the transactions contemplated by this Agreement, which shall be in a
form and substance reasonably satisfactory to the other party.

     7.2  Maintain Subject Business as a Going Concern. Through the Closing
          --------------------------------------------
Date, Seller shall maintain PSA and business of the PSA in accordance with past
practices and sound business judgment

                                       16
<PAGE>

and preserve the goodwill of the employees, customers and others having business
relations with Seller.

     7.3  Employee Benefits. Seller shall continue to be responsible for the
          -----------------
administration and payment of all PSA employee benefit claims including, but not
limited to holidays, vacations, retirement, long-term disability, workers'
compensation, medical or life insurance claims (i) for all of PSA's employees
which are pending or exist as of the Closing Date, (ii) for all of PSA's
employees who are or become retired or terminated before the Closing Date with
respect to disability, illness or any other state of facts occurring prior to
the Closing Date, and (iii) for all employees of PSA (or their eligible
dependents) with respect to any state of facts occurring prior to the Closing
Date.

     7.4  Employee Options. Options for the purchase of securities issued by
          ----------------
Seller for the following listed employees shall be vested in such employees on
the Closing Date, to-wit:

          Employee:                          Options:
          --------                           -------
          Rebecca Williams                     7,125
          Joe Bryan Ray                        7,125
          Jean Pierce                          7,125
          Michael Dobbs                       17,314

                                   ARTICLE 8

                             RIGHT TO INVESTIGATE
                             --------------------

     8.1   Buyer's principal officers, directors and employees are currently
principal officers, directors and employees of PSA and, as such, have been and
are currently primarily responsible for the Financial Statements and, generally,
the business of PSA. Buyer and its principal officers, directors and employees
have had full and complete access to the offices, properties, books, contracts
and records of PSA and Buyer and its principal officers, directors and employees
have had a reasonable opportunity to investigate and fully audit the operations
and assets of PSA. In the event

                                       17
<PAGE>

of the termination of this Agreement, Buyer shall deliver, or cause to be
delivered, to Seller all documents, work papers and other material obtained by
Buyer or on its behalf, from PSA, and all copies thereof, whether so obtained
before or after the execution of this Agreement, and shall not itself use,
directly or indirectly or through any subsidiary, any information so obtained,
or otherwise obtained from PSA, or in connection herewith (unless such
information is generally known in the industry or was acquired after the date
hereof from a third party having a bona fide right to provide the same to
Buyer), and shall endeavor to keep all such information confidential.

                                   ARTICLE 9

                 CONDITIONS TO THE OBLIGATIONS OF THE PARTIES
                 --------------------------------------------
     The obligations of Buyer are subject to the conditions that:

     9.1  Corporate Authorization. On or before the Closing Date, Seller will
          -----------------------
have furnished to Buyer (i) a certificate of existence of the Seller issued by
the Delaware Secretary of State and (ii) a copy, certified by the Secretary of
Seller, of resolutions duly adopted by the Board of Directors of Seller which
constitute all necessary corporate authorization for the consummation by Seller
of the transactions contemplated by this Agreement. On or before the Closing
Date, Seller shall furnish, or cause PSA to furnish, to Buyer (i) a certificate
of existence of PSA issued by the Tennessee Secretary of State, (ii) a complete
copy of Articles of Incorporation of PSA issued by the Tennessee Secretary of
State, and (iii) a complete copy of the Bylaws of PSA certified by the Secretary
of PSA as being true, correct and complete.

     9.2  Representations and Warranties. The representations and warranties of
          ------------------------------
Seller and PSA, as applicable, contained in this Agreement will have been true
and correct when made and will be true and correct at and as of the Closing
Date. Seller and PSA will have performed or complied

                                       18
<PAGE>

in all respects with all terms, agreements, covenants and conditions required by
this Agreement to be performed or complied with by them on or prior to the
Closing Date. Buyer will have received a certificate, dated the Closing Date and
executed on behalf of Seller, to the effect that the foregoing conditions have
been satisfied, which certificate shall be in a form and substance reasonably
satisfactory to Buyer.

     9.3  Absence of Changes. During the period from the date of this Agreement
          ------------------
to the Closing Date, there will not have been any loss of or damage to the
assets of PSA which has not been repaired or replaced by PSA in accordance with
past practices of PSA, or any adverse change in the financial condition,
business, prospects, results of operations or assets of PSA. Prior to the
Closing Date, Seller agrees to notify Buyer in writing of any such loss, damage
or adverse change, and at the Closing Seller shall deliver to Buyer a
certificate that there has been no such loss, damage or adverse change.

     9.4  Consents. On or prior to the Closing Date, Seller shall have obtained
          --------
the necessary consents referred to in Section 7.1, which shall be in a form and
substance reasonably satisfactory to Buyer.

     9.5  Legal Opinion. Buyer shall have received an opinion, dated the Closing
          -------------
Date, of Wyatt, Tarrant & Combs, LLP, counsel for Seller, as to such matters as
are usual and customary in the sale of stock.

     9.6  Legality; Litigation Affecting Closing. There shall exist no
          --------------------------------------
applicable law, rule, regulation, order, judgment or injunction the effect of
which is to prohibit the consummation of the transactions contemplated by this
Agreement. No suit, action or other proceeding shall be pending or actually
threatened before any court or governmental agency which seeks to restrain or
prohibit

                                       19
<PAGE>

the consummation of the transactions contemplated hereby, and no formal
investigation that might eventuate in any such suit, action or proceeding shall
be pending.

     9.7  Other Documents. Subject to the fulfillment of all of the conditions
          ---------------
set forth in this Article 9and the delivery of all certificates and opinions
required hereby, except such conditions, certificates, and opinions as may be
waived by the parties, on the Closing Date Seller shall deliver to Buyer all
original certificates for the Stock, duly endorsed (or accompanied by
appropriate stock powers), and other good and sufficient instruments of transfer
and conveyance, and releases, satisfactions, and termination statements from
secured parties, as may be necessary to transfer to and vest in Buyer good,
absolute, and marketable title to the Stock, free and clear of all pledges,
claims, assessments, charges, liens, security interests, encumbrances, rights of
others, and other restrictions.

                                  ARTICLE 10

                    CONDITIONS TO THE OBLIGATIONS OF SELLER
                    ---------------------------------------

         The obligations of Seller are subject to the conditions that:

     10.1 Corporate Authorization. On or before the Closing Date, Buyer will
          -----------------------
have furnished to Seller a copy, certified by the Secretary of Buyer, of
resolutions duly adopted by the governing authorities of Buyer, which constitute
all necessary corporate authorization for the consummation by Buyer of the
transactions contemplated by this Agreement. On or before the Closing Date,
Buyer shall furnish to Seller (i) a certificate of existence of Buyer issued by
the Tennessee Secretary of State, (ii) a complete copy of Articles of
Incorporation of Buyer issued by the Tennessee Secretary of State, and (iii) a
complete copy of the Bylaws of Buyer certified by the Secretary of Buyer as
being true, correct and complete.

                                       20
<PAGE>

     10.2   Representations and Warranties. The representations and warranties
            ------------------------------
of Buyer contained in this Agreement will have been true and correct when made
and will be true and correct at and as of the Closing Date. Buyer will have
performed or complied in all respects with all terms, agreements, covenants and
conditions required by this Agreement to be performed or complied with by it on
or prior to the Closing Date. Seller will have received a certificate, dated the
Closing Date and executed on behalf of Buyer, to the effect that the foregoing
conditions have been satisfied, which certificate shall be in a form and
substance reasonably satisfactory to Seller.

     10.3   Consents. On or prior to the Closing Date, Buyer shall have obtained
            --------
the necessary consents referred to in Section 7, which shall be in a form and
substance reasonably satisfactory to Seller. In respect of the two (2) lease
agreements pertaining PSA's corporate offices located at Suites 100 and 105,
Airport Executive Plaza, Nashville, Tennessee, Buyer and Seller shall either (i)
procure a written release and discharge of the Seller from the lessor
thereunder, or (ii) Buyer and Douglas C. Altenbern shall guarantee, in writing,
to Seller PSA's performance of the two (2) lease agreements and Buyer shall
promptly make application to and diligently pursue from the lessor a release of
Seller therefrom. In the event Seller is not released from the two (2) lease
agreements, neither Buyer nor PSA shall exercise any options to extend the term
thereof past the current term expiration.

     10.4   Legal Opinion. Seller will have received an opinion, dated the
            -------------
Closing Date, of Buyer's counsel, as to such matters as are usual and customary
in purchases of stock.

     10.5   Legality; Litigation Affecting Closing. There shall exist no
            --------------------------------------
applicable law, rule, regulation, order, judgment or injunction the effect of
which is to prohibit consummation of the transactions contemplated by this
Agreement. No suit, action or other proceeding shall be pending or threatened
before any court or governmental agency which seeks to restrain or prohibit the

                                       21
<PAGE>

consummation of the transactions contemplated hereby, and no formal
investigation that might eventuate in any such suit, action or proceeding shall
be pending.

     10.6   Payment of Purchase Price. On the Closing Date Seller shall receive
            -------------------------
the Purchase Price as provided for in Article 3.

                                  ARTICLE 11

                            POST-CLOSING AGREEMENTS
                            -----------------------

     11.1   Client Referral Program. Seller and its affiliates currently
            -----------------------
maintain a "client referral program" wherein sales representatives of Seller's
affiliates identify potential prospects for the types of services offered by PSA
and to be offered by PSA after Closing. Seller shall use its best efforts to
cause its affiliates to continue the "client referral program" in respect of PSA
and Buyer shall compensate the referring sales representative in accordance with
past practices of PSA. Either Seller or Buyer may terminate this "client
referral program" upon written prior notice to the other, but no termination
shall extinguish the financial obligation of Buyer to compensate the referring
sales representative as herein set forth.

     11.2   E-Mail and Telephone Systems. For a 60 day period following Closing,
            ----------------------------
Seller shall provide PSA voice mail and e-mail through Seller's systems at no
charge. The 60 day period may be extended by written mutual agreement. Seller
confirms that the current phone system in the possession of PSA is an asset of
PSA. After Closing Seller shall assist PSA in defining requirements, evaluating
alternatives and implementing a stand alone system; provided, however, such
assistance shall be limited to systems of the type and nature currently employed
by Seller. To assist PSA in the implementation of a stand alone system, Seller
agrees to reimburse to PSA (i) PSA's out of pocket

                                       22
<PAGE>

costs for the implementation, or (ii) $50,000, whichever is less; provided,
however, such implementation and reimbursement must be made no later than
December 31, 2001.

     11.3   ACH Transactions. EFS National Bank, an affiliate of Seller, is
            ----------------
currently providing certain processing services for PSA related to funds
transfer through the ACH for direct deposits of payroll checks for PSA
customers. Commencing on the Closing Date and continuing for two (2) calendar
years, Seller shall cause EFS National Bank to continue to performs these
services without charge to PSA; provided, the provider of these services shall
be entitled to pass through to PSA any charges for such services assessed by a
third party (such as the Federal Reserve).

     11.4   E-Reporting Project Completion. Seller is in the process of
            ------------------------------
developing a software program internally called "E-Reporting" and having
specifications called "Functional Specifications Pay Systems on-line Payroll
Reports, Version 1, August 31, 2000." Seller shall use reasonable efforts to
complete (which includes internal testing and assistance through implementation
into a production environment) the E-Reporting software program in accordance
with existing Version 1 specifications and on a time line set forth therein or
if not set forth therein on a time line which is usual and customary in the
software development business. At completion, Seller shall convey the E-
Reporting software program to PSA and shall make available to PSA a copy of all
source code and documentation, all without charge. Seller shall make no
representation or warranty in respect of the completed E-Reporting program and
shall offer to PSA no maintenance, update or other obligation to continue
improvement or enhancement thereof. PSA shall not be entitled to sub-license,
re-market or otherwise distribute the E-Reporting software program to third
parties using Seller's name as the developer of the program. Seller shall not be
associated, in any respect, with PSA's prospective use and distribution of the
program.

                                       23
<PAGE>

     11.5   Payment of Intercompany Debts. Seller has provided for the benefit
            -----------------------------
of PSA a payroll and accounts payable system whereby Seller pays such PSA
payroll and payables and establishes a "due to" on the books and records of PSA.
This "due to" account will vary from time to time, depending on timing of PSA
payroll and payables. Buyer acknowledges that the final "due to" account shall
be finally determined by Seller after Closing and Seller shall provide written
notice thereof to Buyer. Buyer shall pay (or shall cause PSA to) pay Seller such
"due to" amounts within fifteen (15) days from the date of the written notice.
To the best of Seller's and PSA's knowledge, the final amount of the "due to"
account is substantially consistent with prior reporting periods, incurred in
the ordinary course of PSA business, and will not include any "extraordinary"
intercompany charges. Any amounts due to PSA from Seller may be used by Buyer
and PSA to off-set against the "due to" account.

     11.6   Non-Disclosure. From and after Closing Date, Seller agrees that it
            --------------
shall not disclose, use, give, or divulge to any third party confidential
information contained in or comprising a part of the business of PSA, including
but not limited to trade secrets, lists of customers, information relating to
costs, profits or losses, pricing techniques, methods or other specialized
information or data learned, acquired or coming to its knowledge in respect
thereof.

     11.7   Depository services. EFS Federal Savings Bank ("EFS Bank"), an
            -------------------
affiliate of Seller, currently provides to PSA certain depository services for
funds that PSA has on account with EFS Bank. Seller shall cause EFS Bank to
continue the provision of these services; provided, however, EFS Bank and PSA
shall enter into a written agreement defining the services and the relationship
of the parties within 60 days following Closing; provided, further, however,
that either EFS Bank or PSA may, at their election, discontinue such services on
15 day prior written notice to the other.

                                       24
<PAGE>

     11.8   Investment Services. EFS Bank currently provides certain investment
            -------------------
services to PSA. Buyer acknowledges and agrees that these investment services
will discontinue at Closing and transition out within 10 days thereafter.
Investment assets of PSA subject to such investment services shall remain the
property of PSA.

     11.9   File Servers. Seller or an affiliate of Seller currently
            ------------
provides certain data processing services to PSA using a single dedicated
Windows NT file server located at PSA's premises. Seller shall continue to
provide these services to PSA through September 30, 2001 at no charge. Seller
and PSA will cooperate to develop a mutually transition plan to discontinue
these services by September 30, 2001. Buyer acknowledges that Seller bears no
risk or liability in performing these services and Buyer indemnifies Seller from
any claims thereunder, absent Seller's gross negligence or willful misconduct.
As part of PSA assets, Seller shall convey, without charge, the single dedicated
Windows NT file server currently in use by PSA to PSA on or prior to Closing.

     11.10  Office Space. Seller shall provide appropriate office space for one
            ------------
(1) employee of PSA at Seller's Memphis, Tennessee offices at no charge through
December 31, 2001.

     11.11  Time and Attendance Reporting Program. Seller has developed a
            -------------------------------------
software program internally called "time and attendance reporting" ("EFSTA 10
Program"). Seller shall make the EFSTA 10 Program available to PSA on a non-
exclusive basis without charge. Seller shall allocate a reasonable number of
personnel to install the EFSTA 10 Program at Buyer's Nashville, Tennessee
office. Seller makes no representation or warranty in respect of the EFSTA 10
Program and Seller shall not offer to Buyer maintenance, updates or other
obligation to continue improvement or enhancement of the EFSTA 10 Program. Buyer
acknowledges that Seller bears no risk or liability

                                       25
<PAGE>

involving the sub-licensing or distribution of the EFSTA 10 Program, and Buyer
indemnifies Seller from any and against any claims regarding this software.

     11.12   EFSTA 10 Program Terminals: Seller or an affiliate of Seller
             --------------------------
currently provides a service tp PSA of purchasing terminals and loading the
EFSTA 10 Programs onto these terminals. Seller will continue to provide this
service to PSA through December 31, 2001, at no charge to Buyer other than the
actual costs associated with the terminal purchase; provided, however, that
Buyer pays any invoices from Seller for these terminal purchasers within 30 days
of receipt.

                                  ARTICLE 12

                                INDEMNIFICATION
                                ---------------

     12.1   Indemnification by Seller.
            -------------------------

            12.1.1   Seller agrees to indemnify and hold the Buyer, its
respective directors, officers, employees, agents, consultants, advisors,
shareholders and affiliates (collectively, the "Indemnified Persons") for and
will pay to the Indemnified Persons the mount of any loss, liability, claim,
damage, fines penalties, expense (including the costs of investigation and
defense and reasonably attorney and accountant fees and expenses, court costs
and all other out-of-pocket expenses) of diminution of value, whether or not
involving a third party claim (collectively, "Damages"), arising directly or
indirectly from or in connection with or arising from each of the following:

                 12.1.1.1   any claims by present or former employees of PSA
     (including leased employees) in connection with their employment with or at
     PSA prior to the Closing Date,

                                       26
<PAGE>

                 12.1.1.2   any other claims of whatever type or character based
     on any state of facts or circumstances regarding the business of PSA
     occurring or arising prior to the Closing Date, or

                 12.1.1.3   any other claims of whatever type or character
     arising from or as a result of any failure by Seller or PSA to perform any
     of its covenants or obligations contained in this Agreement or any breach
     of any warranty or the inaccuracy of any representation of Seller or PSA
     contained or referred to in this Agreement or in any certificate or
     document delivered by or on behalf of Seller pursuant hereto.
     Notwithstanding the foregoing to the contrary, indemnification for any
     claim brought by RMD Corporation based on facts or circumstances occurring
     or arising prior to the Closing Date shall continue until 60 days following
     termination of all such claims by expiration of the statute of limitations
     period or otherwise; provided, however that (i) PSA shall cooperate with
     Seller in providing documentation and other reasonable proof, including
     testimony, in defense of such claims and (ii) Seller shall control the
     claims defense, settlement, counsel and otherwise.

     The indemnifications provided in this Section 12.1.1 shall continue for one
(1) year following the Closing Date.

     12.2   Indemnification by Buyer. Buyer agrees to indemnify and hold
            ------------------------
harmless Seller, its respective directors, officers, employees, agents,
consultants, advisors, shareholders and affiliates from and against any Damages
directly or indirectly incurred by Seller in connection with, arising from or as
a result of any failure by Buyer to perform its covenants and obligations
contained in this Agreement or any material breach of any warranty or the
material inaccuracy of any representation of Buyer contained or referred to in
this Agreement or in any certificate, agreement, instrument or

                                       27
<PAGE>

document delivered by or on behalf of Buyer pursuant hereto. The
indemnifications provided in this Section 12.2 shall continue for one (1) year
following the Closing Date.

     12.3   Notice of Claims. If any indemnified party believes that it has
            ----------------
suffered any Damages, such indemnified party shall so notify the indemnifying
party in writing describing such Damages, the amount thereof, if known, and the
method by which such Damages has been computed, all with reasonable
particularity and containing a reference to the provisions of this Agreement or
any certificate or document delivered pursuant hereto in respect of which such
Damages shall have occurred. If any action at law or suit in equity is
instituted by or against a third party with respect to which an indemnified
party intends to claim any liability or expense as a Damages under this Article
12, such indemnified party shall promptly notify the indemnifying party in
writing of such action or suit.

     12.4   Third-Party Claims. The indemnifying party shall conduct and
            ------------------
control, through counsel of its choosing, any third-party claim, action or suit,
and such indemnifying party may compromise or settle the same, provided that
such indemnifying party shall give the indemnified party at least twenty (20)
days' advance written notice of any proposed compromise or settlement. If the
indemnified party rejects the proposed settlement or compromise, it may then
assume the conduct and control of the defense of the claim, action or suit, but
in that event the indemnifying party shall not be responsible for any amount or
obligation in excess of the amount of the settlement or compromise proposed by
the indemnifying party and the indemnified party shall be responsible for all
Damages from and after the time it assumes the conduct and control of the
defense. Buyer and PSA shall cooperate with Seller in providing documentation
and other reasonable proof, including testimony, in defense of claims of RMD
Corporation referenced in Section 5.9 above and Buyer and PSA

                                       28
<PAGE>

acknowledges that Seller shall control the RMD Corporation claims defense,
settlement, counsel and otherwise. Should the indemnifying party decide not to
conduct and control any such third-party claim, action or suit, the indemnified
party may assume that conduct and control, and any compromise or settlement
entered into by the indemnified party shall be binding upon the indemnifying
party. In any such third-party claim, action or suit, the indemnifying party
shall permit the indemnified party, if the indemnified party so elects, to
participate in the defense of any such claim, action or suit through counsel
chosen by the indemnified party, provided that the fees and expenses of such
counsel shall be borne by the indemnified party. For purposes of this Section
12.4 the compromise or settlement of a third-party claim, action or suit shall
include, with limitation, any recognition or admission of liability or
responsibility.

     12.5   Payment of Damages. Payment in respect of any indemnification shall
            ------------------
be accompanied by an amount equal to interest on such payment for the period
from the date the Loss or Expense was incurred to the date of payment at a rate
per annum (on the basis of a 360-day year) equal to the composite prime rate set
forth in The Wall Street Journal, Money Rates, in effect from time to time
         -----------------------
during such period.

                                  ARTICLE 13

                USE OF NAMES AND NON-SOLICITATION OF CUSTOMERS
                ----------------------------------------------

     From and after the Closing, Seller shall not (i) use any of the names,
trademarks, service marks, trade names or copyrights of PSA, or (ii) solicit any
customer of PSA for the provision of the same or similar services provided by
PSA on the Closing Date.

                                       29
<PAGE>

                                  ARTICLE 14

                                     TAXES
                                     -----

     14.1   Buyer shall pay any applicable sales, documentary, use, filing,
transfer or other taxes required to be paid in connection with the transfer of
the Stock to Buyer. All other taxes on the ownership of the Stock that are
payable prior to the Closing Date shall be paid by Seller and all such taxes
payable on or after the Closing Date shall be paid by Buyer. Notwithstanding the
provisions of this Section, any taxes payable on or measured by the net income
of Buyer or Seller (including income and net worth taxes), imposed or levied by
or payable to any federal, state or local taxing authority, shall be paid or
payable by the party upon which such taxes are imposed or levied.

                                  ARTICLE 15

                            SURVIVAL OF OBLIGATIONS
                            -----------------------

     15.1   All representations, warranties, covenants and obligations contained
herein as to Seller, PSA and as to Buyer shall continue for one (1) year after
the Closing Date. No information contained in any documents delivered to a party
hereto, whether before or after the date hereof and whether or not pursuant to
this Agreement, shall limit the right of a party hereto to rely upon the
representations, warranties, covenants and obligations made by another party
hereto.

                                  ARTICLE 16

                 TERMINATION, AMENDMENT, ASSIGNMENT AND WAIVER
                 ---------------------------------------------

     16.1   Termination. This Agreement may be terminated at any time prior to
            -----------
the Closing Date:

            16.1.1   by mutual consent of Seller and Buyer; or

                                       30
<PAGE>

            16.1.2   by either party upon a breach of this Agreement by the
other party, which breach is not cured within ten (10) days after written
notice thereof.

     16.2   Effect of Termination. In the event of any termination of this
            ---------------------
Agreement, neither of the parties to this Agreement will have any liability to
the other except for any breach of any of the provisions of this Agreement.

     16.3   Amendment and Assignment. This Agreement may be amended only by an
            ------------------------
instrument in writing signed on behalf of each of the parties hereto. This
Agreement may not be assigned by either Seller or Buyer, provided, however, that
Buyer shall have the right to assign this Agreement and its rights hereunder to
any affiliated or subsidiary corporation; provided, further, however, (i) such
assignment shall be in writing, (ii) signed by the assignee, and (iii) a true
and complete copy thereof shall be delivered to Seller promptly following
execution thereof. No assignment by Buyer of this Agreement shall relieve Buyer
of its obligations herein. After any such assignment by the Buyer, Seller shall
be entitled to deal directly with the assignee to the exclusion of the Buyer.

     16.4   Extension; Waiver. The parties hereto may (i) extend the time for
            -----------------
the performance of any of the obligation or other acts of the other parties
hereto; or (ii) waive any breach in the representations, warranties, covenants,
terms and conditions contained in this Agreement, except that such waiver shall
in no way affect, limit or waive a party's rights hereunder at any time to
enforce strict compliance thereafter with every representation, warranty,
covenant, term or condition of this Agreement.

                                  ARTICLE 17

                               COMMISSION; FEES
                               ----------------

                                       31
<PAGE>

     Seller represents and warrants that no broker or finder is entitled to any
brokerage or finder's fees or other commission or fee from Seller based upon
arrangements made by or on behalf of Seller with respect to the transactions
contemplated by this Agreement. Buyer represents and warrants that no broker or
finder is entitled to any brokerage or finder's fees or other commission or fee
from Buyer based upon arrangements made by or on behalf of Buyer with respect to
the transactions contemplated by this Agreement.

                                  ARTICLE 18

                                   EXPENSES
                                   --------

     Unless otherwise specified herein, all costs and expenses incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such costs and expenses.

                                  ARTICLE 19

                            NO PUBLIC ANNOUNCEMENT
                            ----------------------

     Neither Seller nor Buyer shall, without the prior approval of the other
party, make any press release or other public announcement concerning the
transactions contemplated by this Agreement, except as and to the extend that
either party shall be so obligated by law and except as Seller may be required
to do so by regulations of the Securities and Exchange Commission or the New
York Stock Exchange, in which case the other party shall be so advised and the
parties shall use their best efforts to cause a mutually agreeable release or
announcement to be issued.

                                  ARTICLE 20

                                  COOPERATION
                                  -----------

                                       32
<PAGE>

     20.1   Both before and after the Closing, each of the parties hereto shall
cooperate with the other in every way in making all necessary filings, obtaining
all necessary consents and approvals, governmental or otherwise, and in carrying
out the transactions contemplated hereby, and delivering instruments to perfect
the conveyances, assignments and transfers contemplated hereby and in delivering
all documents and instruments deemed reasonably necessary or useful by counsel
for any party hereto. The parties hereto agree with each other that after the
Closing Date they will grant to each other and their agents access, during
normal business hours and upon reasonable notice, to any books, records and
personnel then in their possession to the extent that such access is shown to be
needed for tax, accounting, investigation of claims, or other reasonable
purposes.

     20.2   Mark Bennett (the "Consulting Employee"), an employee in the Memphis
office of PSA, shall be re-assigned to an affiliate of Seller at Closing. For a
maximum four (4) month period following Closing Date, Seller shall cause the
Consulting Employee to be available to PSA to assist in the transition of PSA
from Seller to Buyer. The Consulting Employee shall serve as sales manager of
PSA and shall devote 100% of his time and effort to the work of PSA and shall,
during such assignment, have no responsibility or duties to Seller. Buyer shall
reimburse Seller or the affiliate of Seller maintaining the employment of the
Consulting Employee for all payroll costs and expenses incurred by the employer
thereof. Such reimbursement shall be made by Buyer within five (5) days
following submission to Buyer of an invoice therefor reasonably detailing the
costs and expenses.

                                       33
<PAGE>

                                  ARTICLE 21

                       PASSAGE OF TITLE AND RISK OF LOSS
                       ---------------------------------

     21.1   Legal and equitable title with respect to PSA shall not pass to
Buyer until the Stock is transferred to Buyer at the Closing. The risk of any
loss damage or destruction to any of PSA from fire or other casualty or cause
shall be borne by the Seller at all times prior to the Closing and thereafter by
Buyer. Upon the occurrence of any material loss or damage to any of the assets
of PSA as a result of fire or other casualty or cause prior to Closing, Seller
shall notify Buyer of same in writing immediately stating with particularity the
extend of such loss or damage incurred, the cause thereof if known and the
extend to which restoration, replacement and repair of the assets lost or
destroyed will be reimbursed under any insurance policy with respect thereto.

     21.2   Seller shall repair or replace same as soon as possible after the
loss or damage and shall use best efforts to restore same as promptly as
possible. The Closing Date shall be extended if necessary for up to thirty (30)
days to permit such repair or replacement and the termination date contained in
this Agreement shall be tolled during this period. If repair or replacement
cannot be accomplished within thirty (30) days, then Buyer may elect, at its
sole option, to:

            21.2.1   Terminate this Agreement;

            21.2.2   Postpone the Closing Date and again toll the termination
         date of this Agreement until such time as the assets have been
         completely repaired, replaced or restored (which restorations shall be
         made in a manner consistent with past practices of Seller), unless the
         same cannot be reasonably effected within five (5) months of
         notification, in which case either party may terminate this Agreement;
         or

                                       34
<PAGE>

            21.2.3   Close and accept the assets in its "then" condition, in
         which event Seller shall assign or cause to be assigned all rights
         under any insurance claims covering the loss and pay over or cause to
         be paid over any proceeds under any such insurance policies received by
         Seller with respect thereto together with an amount equal to the
         difference between the amount of such proceeds and the cost of repair
         or replacement to the party or parties entitled to have received such
         assets.

                                  ARTICLE 22

                            WAIVER, DISCHARGE, ETC.
                            ----------------------

          This Agreement may not be released, discharged, abandoned, changed or
modified in any manner, except by an instrument in writing signed on behalf of
each of the parties hereto by their duly authorized officers of representatives.
The failure of any party thereto to enforce at any time any of the provisions of
this Agreement shall in no way be construed to be a waiver of any such
provision, nor in any way to affect the validity of this Agreement or any part
thereof or the right of any party thereafter to enforce each and every such
provision. No waiver of any breach of this Agreement shall be held to be a
waiver of any other or subsequent breach. The illegality or partial illegality
of any provision of this Agreement in any country shall not affect the validity
of this Agreement or any provision hereof in any other country.

                                       35
<PAGE>

                                  ARTICLE 23

                             TRANSITION ASSISTANCE
                             ---------------------

     After the Closing Date, Seller shall provide Buyer with reasonable
assistance in order to permit an orderly transition of ownership of PSA and to
allow Buyer to continue normal operations with respect to PSA.

                                  ARTICLE 24

                                    NOTICES
                                    -------

     24.1   All notices and other communications hereunder will be in writing
and will be deemed given if delivered personally, sent by expedited delivery
service or mailed by registered or certified mail (return receipt requested) to
the parties at the addresses set forth in the premises (or at such other address
for a party as may be specified by like notice).

                                  ARTICLE 25

                                INTERPRETATION
                                --------------

     Unless otherwise specified, all references to Articles, Sections, Exhibits
or Schedules herein are references to Articles, Sections, Exhibits or Schedules
hereof or hereto. The headings contained in this Agreement are for reference
purposes only and will not affect in any way the meaning or interpretation of
this Agreement.

                                  ARTICLE 26

                                 MISCELLANEOUS
                                 -------------

     26.1   This Agreement (including the Exhibits, Schedules, documents and
instruments referred to herein) (a) constitutes the entire agreement and
supersedes all other prior agreements and

                                       36
<PAGE>

understandings, both written and oral, among the parties, or any of them, with
respect to the subject matter hereof; (b) is not intended to confer upon any
other person or entity, other than a party hereto, any rights or remedies
hereunder; (c) except as permitted herein otherwise, shall not be assigned by
operation of law or otherwise; and (d) shall be governed in all respects,
including validity, interpretation and effect, by the laws of the State of
Tennessee, governing contracts made and performed in that State. This Agreement
may be executed in two or more counterparts which together will constitute a
single instrument.

                     (signatures of parties on next page)

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

CONCORD EFS, INC.                           PAYROLL COMPANY, INC.

By: /s/ Edward Haslam                       By: /s/ Michael J. Dobbs
   ---------------------------------           ---------------------------------
        Edward Haslam                       Printed Name: Michael J. Dobbs
        Chief Financial Officer             Title: President

JOINDER BY PAY SYSTEMS OF AMERICA, INC.

     Pay Systems of America, Inc. joins herein to acknowledge its
representations and warranties contained in Section 5 above, but not further of
otherwise.

PAY SYSTEMS OF AMERICA, INC.

                                       37
<PAGE>

By: /s/ Michael Dobbs
   ------------------------------
        Michael Dobbs
        President

                                       38
<PAGE>

Exhibit "A"             NON-NEGOTIABLE PROMISSORY NOTE
                        ------------------------------

$1,400,000.00                                               Nashville, Tennessee
                                                                  March 30, 2001

         FOR VALUE RECEIVED, the undersigned PAYROLL COMPANY, INC., a Tennessee
corporation (hereinafter "Maker"), promises to pay to CONCORD EFS, INC., a
Delaware corporation (hereinafter "Payee"), the principal sum of ONE MILLION
FOUR HUNDRED THOUSAND and NO/100 DOLLARS ($1,400,000.00), together with interest
thereon from date hereof at rate of six percent (6%) per annum

         The outstanding principal balance hereunder, together with all accrued
but unpaid interest, shall be payable as follows:

         On March 30, 2002, the principal amount of $700,000.00, plus accrued
         but unpaid interest; and

         On March 30, 2003, the principal amount of $700,000.00, plus accrued
         but unpaid interest.

         Upon default in the payment of any installment of principal or interest
due under this Note, upon any default in the Maker's performance of or
compliance with the terms, conditions and provisions of that certain Sale and
Purchase Agreement of even date herewith between Maker and Payee, or upon any
default in the payment of any other indebtedness, liability or obligation now or
hereafter owed by the Maker to the Payee hereof, and upon Maker's failure to
cure same during the applicable time period set forth therein, if any, then, the
entire unpaid principal balance then owed upon this Note, together with all
interest then accrued, shall, at the option of the Payee at once become due and
payable.

         Both principal and interest shall be payable in lawful money of the
United States of America, which shall be legal tender in payment of all debts,
public and private, and due at the time of payment. Payments shall be made at
the office of Payee or at such other place as the holder hereof may designate in
writing.

         The principal and any unpaid installment of interest, as evidenced by
this Note, shall bear interest from the date of maturity (whether by demand,
acceleration or otherwise) until this Note is paid in full at the maximum rate
of interest Payee is permitted by law to contract for and charge.

         In the event any principal or interest due hereunder shall not be paid
when due, and such default shall continue for a period of ten (10) days from the
date such payment shall have been due and payable (without regard to any cure or
grace period), including principal and accrued interest becoming due by reason
of acceleration of the entire unpaid balance of the Note, Maker agrees to pay to
the Payee a late fee of six cents ($0.06) for each dollar so overdue.

<PAGE>

         If this Note is placed in the hands of an attorney for collection by
suit, or if collection by suit through the probate court, bankruptcy court, or
by any other legal proceedings for its payment or to enforce its collection,
Maker will pay all costs of collection and litigation incurred, together with
reasonable attorney's fees.

         The principal of this Note may be prepaid in part or full without
premium or penalty. All accrued and unpaid interest on the amount of the
principal being prepaid shall be payable on the date of any such principal
payment.

         The Maker and any endorsers hereof waive protest, demand, presentment,
and notice of dishonor, and agree that this Note may be extended, in whole or in
part, without limit as to the number of such extensions, or the period or
periods thereof, and without notice to it and without affecting its liability
thereon.

         This Note shall be construed and enforced in accordance with laws of
the State of Tennessee.

         This Note is non-negotiable by the Payee; provided, however, Payee
shall be permitted to transfer, endorse and assign this Note to any affiliate or
parent of Payee.

                                          PAYROLL COMPANY, INC.
                                          a Tennessee corporation

                                          By:      _____________________________
                                          Printed Name: ________________________
                                          Title:   _____________________________

                                       2

<PAGE>

Exhibit "B"                       GUARANTY OF PAYMENT
                                  -------------------

         FOR VALUE RECEIVED and in consideration of advances made or to be made,
or credit given or to be given, or other financial accommodations from time to
time afforded or to be afforded to PAYROLL COMPANY, INC., a Tennessee
corporation (hereinafter called "Debtor"), by CONCORD EFS, INC., a Delaware
corporation, or its successors and assigns (all of which are hereinafter
collectively called "Creditor"), the undersigned hereby, jointly and severally,
guarantee the full and prompt payment to Creditor at maturity and at all times
thereafter of that certain Non-Negotiable Promissory Note dated on or about
March 30, 2001, in the original principal amount of $1,400,000.00, together with
interest, late fees and costs provided therein; and the undersigned further
agree(s) to pay all expenses, legal and/or otherwise (including court costs and
attorney's fees) paid or incurred by Creditor in endeavoring to collect such
indebtedness, obligations and liabilities, or any part thereof, and in enforcing
this guaranty. When the aforementioned obligations are paid in full, this
Guaranty of Payment shall expire and the holder and owner hereof shall deliver
the original hereof to the undersigned.

         In case of the dissolution, liquidation or insolvency (howsoever
evidenced) of, or the institution of bankruptcy or receivership proceedings
against said Debtor, all of said indebtedness, obligations and liabilities then
existing shall, at the option of Creditor, immediately become due or accrued and
payable from the undersigned.

         All dividends or other payments received from the Debtor, or on account
of the debt from whatsoever source, shall be taken and applied as payment in
gross, and this guaranty shall apply at the option of Creditor to and secure any
ultimate balance that shall remain owing to Creditor.

         Any payments made by the undersigned on the indebtedness of the Debtor
and resulting in the undersigned having a claim against the Debtor, shall be
subordinate to any and all then existing indebtedness owed Creditor by the
Debtor and also to such subsequent loans or advances which, at the option of
Creditor, may be made.

         This guaranty shall be a continuing absolute and unconditional
guaranty, subject to the limitation hereinabove set forth, and shall remain in
full force and effect until written notice of its discontinuance shall be
actually received by Creditor, and also until any and all said indebtedness,
obligations and liabilities existing before receipt of such notice shall be
fully paid.

         The liability hereunder shall in no wise be affected or impaired by
(and Creditor is hereby expressly authorized to make from time to time, without
notice to anyone), any sale, pledge, surrender, compromise, settlement, release,
renewal, extension, indulgence, alteration, substitution, exchange, change in,
modification or other disposition of any of said indebtedness, obligations and
liabilities, either express or implied, or of any contract or contracts
evidencing any thereof, or of any security or collateral therefor. The liability
hereunder shall in no wise be affected or impaired by any acceptance by Creditor
of any security for or other guarantors upon any of said indebtedness,
obligations or liabilities, or by any failure, neglect or omission on the

                                       3

<PAGE>

part of Creditor to realize upon or protect any of said indebtedness,
obligations or liabilities, or any collateral or security therefor, or to
exercise any lien upon or right of appropriation of any moneys, credits or
property of said Debtor, possessed by Creditor, toward the liquidation of said
indebtedness, obligations or liabilities, or by any application of payments or
credits thereon. Creditor shall have the exclusive right to determine how, when
and what application of payments and credits, if any, shall be made on said
indebtedness, obligations and liabilities, or any part of them. In order to hold
the undersigned liable hereunder, there shall be no obligation on the part of
Creditor at any time to first resort to, make demand on, file claim against, or
exhaust its remedies against the Debtor, or other persons or corporations, their
properties or estates, or to resort to and exhaust its remedies against any
collateral, security, property, liens or other rights whatsoever. It is
expressly agreed that the Creditor may at any time make demand for payment or
payments on, or bring suit against, the undersigned guarantors, jointly or
severally, or any one or more of the undersigned, less than all, without
impairing the rights of the Creditor against the others of the undersigned; and
that the Creditor may compound with any one or more of the undersigned for such
sums as it may see fit and release such of the undersigned from all further
liability to the Creditor for such indebtedness without impairing the right of
the Creditor to demand and collect the balance of such indebtedness from others
of the undersigned not so released.

         All diligence in collection or protection, and all presentment, demand,
protest and/or notice, as to any and everyone, of dishonor and of default and of
nonpayment and of the creation and existence of any and all of said
indebtedness, obligations and liabilities, and of any security and collateral
therefor, and of the acceptance of this guaranty, and of any and all extensions
of credit and indulgence hereunder, are hereby expressly waived.

         The granting of credit from time to time by Creditor to said Debtor in
excess of the amount to which the right of recovery under this guaranty is
limited and without notice to the undersigned, is hereby also authorized and
shall in no way affect or impair this guaranty.

         All paper discounted for said Debtor and all loans made to said Debtor,
when paid, shall be deemed to have been paid by said Debtor, unless express
notice in writing is given to said Creditor at the time by the undersigned that
it has been paid by them.

         No act of commission or omission of any kind, or at any time, upon the
part of said Creditor in respect to any matter whatsoever, shall in any way
affect or impair this guaranty.

         Creditor may, without any notice whatsoever to anyone, sell, assign, or
transfer all of said indebtedness, obligations and liabilities or any part
thereof, and in that event each and every immediate and successive assignee,
transferee, or holder of all or any part of said indebtedness, obligations and
liabilities, shall have the right to enforce this guaranty, for the benefit of
such assignee, transferee or holder, as fully as if such assignee, transferee or
holder were herein by name specifically given such rights, powers and benefits;
but Creditor shall have an unimpaired right, prior and superior to that of any
said assignee, transferee or holder, to enforce this guaranty

                                       4

<PAGE>

for the benefit of Creditor, as to so much of said indebtedness, obligations and
liabilities that it has not sold, assigned or transferred.

         Notice to the undersigned guarantors of the acceptance of this guaranty
and of the making or renewing of any loan or paper is hereby expressed waived by
the undersigned. All rights, defenses and benefits conferred by any statute of
limitations to the undersigned affecting the enforcement hereof are expressly
waived and it is expressly agreed that any action may be maintained to enforce
this guaranty at any time.

         No release of any one or more of the guarantors of the indebtedness,
obligations and liabilities guaranteed hereby shall release any of the other
guarantors of said indebtedness, obligations and liabilities, unless and until
all of said indebtedness, obligations, and liabilities shall have been fully
paid and discharged.

         This guaranty shall be construed according to the law of the State of
Tennessee, in which State it shall be performed by the undersigned. This
guaranty and every part thereof, shall be binding upon the undersigned, jointly
and severally, and upon the heirs, legal representatives, successors and assigns
of all the undersigned, and each of them, respectively.

         After having carefully read this instrument the same was signed, sealed
and delivered by the undersigned, this 30th day of March, 2001, and was
thereafter received by Creditor in Nashville, Tennessee.

                                       _______________________________________
                                                 Douglas C. Altenbern

                                       5

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