Document:

exv10w2

Exhibit 10.2

EXECUTIVE EMPLOYMENT AGREEMENT

     This EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”) is made and entered into as of this
18th day of May, 2009, by and between Bank of Birmingham, a Michigan state bank
(“Bank”), and Lance N. Krajacic, Jr., an individual resident of the State of Michigan
(“Executive”).

     WHEREAS, the Bank and the Executive are parties to an employment agreement dated June 28, 2007
(the “Prior Agreement”) providing for the Executive to be employed as Chief Credit Officer/Chief
Operating Officer of the Bank, and Executive desires to continue such employment, subject to and on
the terms and conditions set forth in this Agreement; and

     WHEREAS, the Bank and the Executive wish to amend and restate the Prior Agreement; and

     WHEREAS, both the Bank and the Executive have read and understood the terms and provisions set
forth in this Agreement and have been afforded a reasonable opportunity to review this Agreement
with their respective legal counsel.

     NOW, THEREFORE, in consideration of the mutual promises and covenants set forth in this
Agreement, the Executive and the Bank agree as follows:

A. DURATION

     1. This Agreement shall become effective (the “Effective Date”) upon the date of its execution
indicated above and shall continue in full force and effect, subject to Paragraph 2 below, until
the first anniversary the Effective Date, unless earlier terminated as provided herein. The
original effective date of the Agreement, prior to this restatement was July 26, 2006 (the
“Original Effective Date”).

     2. The Bank and the Executive acknowledge and agree that the parties may agree to continue the
employment relationship upon such terms as they may mutually agree. Each day during the term of
the Agreement, the term of the Agreement shall automatically be extended one additional day, unless
either party elects to give the other party written notice of non-renewal at least thirty (30)
calendar days prior to the expiration of the then current term. Upon the Bank giving notice of
non-renewal, the Executive shall have the right to remain employed by the Bank for the one (1) year
period following the date the Bank gives notice of non-renewal unless the termination is for Good
Cause (as hereinafter defined).

B. COMPENSATION

     3. All payments of salary and other compensation to the Executive shall be payable in
accordance with the Bank’s ordinary payroll and other policies and procedures.

a. During the term of this Agreement, the Bank agrees to pay Executive a base salary of not less
than $135,000 annually, appropriately prorated for partial months at the commencement and end of
the term of this Agreement.

b. The Bank shall have the right to deduct from any payment of compensation to Executive hereunder
any federal, state or local taxes required by law to be withheld with respect to such payments and
any other amounts specifically authorized to be withheld or deducted by Executive.

 

 

c. During the term of this Agreement, it is anticipated that the Board of Directors or a delegated
committee thereof will adopt an executive incentive bonus plan based upon the asset growth and
profitability of the Bank. The Executive will be entitled to participate in such plan. Executive
shall also be entitled to participate in any benefit programs applicable to all employees of the
Bank or to executive employees of the Bank in accordance with Bank policy and the provisions of
said benefit programs.

     4. The Bank shall provide the Executive with a cellular phone and laptop computer for use in
the performance of his duties and obligations under this Agreement. The Bank shall also reimburse
the Executive for all reasonable expenses, including, but not limited to, travel expenses, lodging
expenses, and meals and entertainment expenses, that the Executive may incur in the performance of
his duties and obligations under this Agreement; provided, however, that the Executive shall be
required to submit receipts or other acceptable documentation to the cashier of the Bank or such
other officer designated by the Board to verify such expenses prior to any reimbursements. In
addition to the reimbursement of expenses listed in this Paragraph, the Bank shall pay, or
reimburse Executive, for reasonable initiation fees for trade association memberships deemed to be
acceptable and appropriate by the Board of Directors. Reimbursement under this Paragraph 4 shall
be made in accordance with the Bank’s expense reimbursement policies, but in no event later than
the last day of the calendar year following the calendar year in which the expenses are incurred.
Reimbursement under this Paragraph 4 shall not affect the expenses eligible for reimbursement in
any other calendar year and cannot be liquidated or exchanged for any other benefit.

     5. Subject to the provisions of Paragraph 8 of this Agreement, the Executive shall be entitled
to receive employee and dependent health insurance, dental insurance, paid sick leave and four (4)
weeks of paid vacation per year, and any additional benefits provided to all Bank employees all in
accordance with the Bank’s employment policies.

     6. The Bank shall also provide the Executive with term life insurance coverage in an initial
amount not to exceed 200% of Executive’s base salary, and having a term not less than ten years.
If, during the term of this Agreement, the Bank adopts a plan providing life insurance benefits to
other Bank employees and the maximum coverage under such plan exceeds the maximum permissible
coverage provided by this Paragraph, then notwithstanding the provisions of this Paragraph,
Executive shall be entitled to participate in the Bank’s life insurance benefit plan to the full
extent that it is available to other Bank employees.

     7. The Board of Directors or a delegated committee shall review the amount of Executive’s
compensation, including his base salary, not less than annually and shall increase such base salary
as a result of such review and to provide reasonable cost of living adjustments, all in the
discretion of the Board of Directors or such committee and consistent with safe and sound banking
practices; provided however that Executive’s base salary, bonuses, vacation and car allowance shall
not be less than the amounts set forth in Paragraphs 3, 4, and 5 at any time during the term of
this Agreement.

     8. All employee benefits provided to the Executive by the Bank incident to the Executive’s
employment shall be governed by the applicable plan documents, summary plan descriptions or
employment policies, and may be modified, suspended or revoked at any time, in accordance with the
terms and provisions of the applicable documents.

     9. The parties hereto acknowledge that the compensation set forth herein and the other
covenants and agreements of the Bank contained herein are fair and adequate compensation for
Executive’s services and for the covenants of Executive as set forth herein.

 

 

C. RESPONSIBILITIES

     10. The Executive shall be employed as Chief Credit Officer/Chief Operating Officer of the
Bank and shall faithfully devote his best efforts and his primary focus to his positions with the
Bank.

     11. The Executive acknowledges and agrees that the duties and responsibilities of the
Executive required by his position as Chief Credit Officer/Chief Operating Officer of the Bank are
wholly within the discretion of its Board of Directors, and may be modified, or new duties and
responsibilities imposed by the Board of Directors, at any time, without the approval or consent of
the Executive. However, these new duties and responsibilities may not constitute immoral or
unlawful acts. In addition, the new duties and responsibilities must be consistent with the
Executive’s role as Chief Credit Officer/Chief Operating Officer of a financial institution.

     12. The Executive acknowledges and agrees that, during the term of this Agreement, he has a
fiduciary duty of loyalty to the Bank, and that he will not engage in any activity during the term
of this Agreement, which will or could, in any significant way, harm the business, business
interests, or reputation of the Bank or the reputation of the Board of Directors.

     13. The Executive shall not directly or indirectly engage in competition with the Bank at any
time during the existence of the employment relationship between the Bank and the Executive, and
the Executive will not on his own behalf, or as another’s agent or employee, engage in any of the
same or similar duties and/or Bank-related responsibilities required by the Executive’s position
with the Bank, other than as an employee of the Bank pursuant to this Agreement or as specifically
approved by the Board of Directors. In addition, without the prior written consent of the Board of
Directors, Executive shall not usurp for himself any corporate opportunity available to the Bank.

D. NONINTERFERENCE

     14. Executive acknowledges that, as part of his employment with the Bank, he will become
familiar with the salary, pay scale, capabilities, experiences, skill and desires of the Bank’s
employees. Executive agrees to maintain the confidentiality of such information. Executive
further covenants and agrees that, for a period of one year subsequent to the termination of this
Agreement, whether such termination occurs at the insistence of the Bank or the Executive, the
Executive shall not recruit, hire, or attempt to recruit or hire, directly or by assisting others,
any other employees of the Bank, nor shall the Executive contact or communicate with any other
employees of the Bank for the purpose of inducing other employees to terminate their employment
with the Bank. For purposes of this covenant, “other employees” shall refer to employees who are
still actively employed by or were employed by the Bank within the prior year, or doing business
with, the Bank at the time of the attempted recruiting or hiring.

     15. In his position of employment, the Executive will be exposed to confidential information
and trade secrets (hereafter “Proprietary Information”) pertaining to, or arising from, the
business of the Bank and its affiliates (if any). The Executive hereby agrees and acknowledges
that such Proprietary Information is unique and valuable to the Bank’s business and that the Bank
would suffer irreparable injury if this information were publicly disclosed. Therefore, the
Executive agrees to keep in strict secrecy and confidence, both during and after the period of his
employment, any and all Proprietary Information which the Executive acquires, or to which the
Executive has access, during employment by the Bank, that has not been publicly disclosed by the
Bank. The Proprietary Information covered by this Agreement shall include, but shall not be
limited to: (i) the identities of the Bank’s existing and prospective customers or clients,
including names, addresses, credit status, and pricing levels; (ii) the buying and selling habits
and customs of the Bank’s existing and prospective customers or clients; (iii) financial
information about the Bank; (iv) product and systems specifications, concepts for new or

 

 

improved products and other product or systems data; (v) the identities of, and special skills
possessed by, the Bank’s employees; (vi) the identities of and pricing information about the Bank’s
suppliers and vendors; (vii) training programs developed by the Bank; (viii) pricing studies,
information and analyses; (ix) current and prospective products and inventories; (x) financial
models, business projections and market studies; (xi) the Bank’s financial results and business
conditions; (xii) business plans and strategies; (xiii) special processes, procedures, and services
of the Bank and its suppliers and vendors; and (xiv) computer programs and software developed by
the Bank or its consultants. The provisions and agreements entered into herein shall survive the
term of the Employee’s employment to the extent reasonably necessary to accomplish their purpose in
protecting the interests of the Bank in any Proprietary Information disclosed to, or learned by,
the Executive while employed.

     16. The Executive expressly represents that he has no agreements with, or obligations to, any
party which conflict, or may conflict, with the interests of the Bank or with the Executive’s
duties as an employee of the Bank.

     17. Executive acknowledges that the special relationship of trust and confidence between him,
the Bank, and its clients and customers creates a high risk and opportunity for Executive to
misappropriate the relationship and goodwill existing between the Bank and its clients and
customers. Executive further acknowledges and agrees that it is fair and reasonable for the Bank
to take steps to protect itself from the risk of such misappropriation. Executive further
acknowledges that, at the outset of his employment with the Bank and throughout his employment with
the Bank, Executive will be provided with access to and informed of Proprietary Information, which
will enable him to benefit from the Bank’s goodwill and know-how. Executive covenants and agrees
that, for a period of one year subsequent to the termination of this Agreement, whether such
termination occurs at the insistence of the Bank or the Executive, the Executive shall not attempt
to solicit, directly or by assisting others, any of the customers or clients of the Bank, nor shall
the Executive contact or communicate with any of the customers or clients of the Bank for the
purpose of attracting their business or to offer any product or service which would be in
competition or that conflicts with the Bank’s business or the business of any of its affiliates.

     18. Executive acknowledges that it would be inevitable in the performance of his duties as a
director, officer, employee, investor, agent or consultant of any person, association, entity, or
company which competes with the Bank, or which intends to or may compete with the Bank, to disclose
and/or use Proprietary Information, as well as to misappropriate the Bank’s goodwill and know-how,
to or for the benefit of such other person, association, entity, or company. Executive also
acknowledges that, in exchange for the execution of the non-solicitation restriction set forth in
these NONINTERFERENCE provisions, he has received substantial, valuable consideration, including:
(i) confidential trade secret and proprietary information relating to the identity and special
needs of the Bank’s current and prospective customers, the Bank’s current and prospective services,
the Bank’s business projections and market studies, the Bank’s business plans and strategies, the
Bank’s studies and information concerning special services unique to the Bank; (ii) employment; and
(iii) compensation and benefits as described in this Agreement. Executive further acknowledges and
agrees that this consideration constitutes fair and adequate consideration for the execution of the
non-solicitation restriction set forth herein.

     19. In consideration for the above-recited valuable consideration, as well as to protect the
vital interests described in these NONINTERFERENCE provisions, the Executive understands and agrees
that during the continuation of this Agreement and for a period of one year following the
termination of this Agreement by either party, for any reason (other than for termination of
Executive for circumstances described in Paragraph 24(e), below), the Executive will not be or
become engaged in any way (directly or indirectly), as an individual proprietor, beneficiary,
trustee, owner, partner, stockholder, officer, director, executive, investor, lender, sales
representative, or in any other capacity, whatsoever, in any activity or endeavor of any entity
headquartered within the Michigan cities/towns of Bloomfield,

 

 

Bloomfield Hills, Beverly Hills, Birmingham, Franklin, or Bingham Farms, which competes or
conflicts with the Bank’s business or the business of any of its affiliates (if any), as such
business has been conducted during the years of the Executive’s employment with the Bank. It is
the parties’ desire that these restrictions be enforced to the fullest extent allowed by law.

     20. Executive agrees that the restriction set forth above is ancillary to an otherwise
enforceable agreement, is supported by independent valuable consideration, and that the limitations
as to time, geographical area, and scope of activity to be restrained by Paragraph 19 are
reasonable and acceptable, and do not impose any greater restraint than is reasonably necessary to
protect the goodwill and other business interests of the Bank. This Section creates a narrowly
tailored advance approval requirement in order to avoid unfair competition and irreparable harm to
the Bank and is not intended or to be construed as a general restraint from engaging in a lawful
profession or a general covenant against competition. Nothing herein will prohibit (i) beneficial
ownership of less than 5% of the publicly traded capital stock of a corporation listed on a
national securities exchange so long as this is not a controlling interest, or (ii) ownership of
mutual fund investments. Executive agrees that if, at some later date, a court of competent
jurisdiction determines that the non-solicitation agreement set forth in this Section does not meet
the criteria set forth by applicable law, this Section may be reformed by the court and enforced to
the maximum extent permitted under applicable law. Executive understands that his obligations
under this Section shall not be assignable by him.

     21. Executive acknowledges that the covenants set forth in these NONINTERFERENCE provisions
are material conditions to the Bank’s willingness to execute and deliver this Agreement and to
provide Executive the compensation and benefits and other consideration provided hereunder. The
parties agree that the existence of any claim or cause of action of Executive against the Bank,
whether predicated on this Agreement or otherwise, will not constitute a defense to the enforcement
by the Bank of such covenants. It is specifically acknowledged that the periods following the
termination of employment stated in Paragraphs 14 and 19, during which the agreements and covenants
of Executive made in such Paragraphs are effective, are to be computed by excluding from such
computation any time during which Executive is in violation of any provision of Paragraph 14 or 19.
In addition, Executive’s obligations under these NONINTERFERENCE provisions shall survive the
termination of this Agreement and Executive’s employment with the Bank. Executive’s obligations
under these NONINTERFERENCE provisions are in addition to, and not in limitation or preemption of,
all other obligations of confidentiality which he may have to Bank under general legal or equitable
principles, or other the Bank policies. In the event of any conflict between or among the
NONINTERFERENCE provisions set forth in this Section D, the more restrictive of the provisions
shall control.

E. REMEDIES

     22. In the event that the Executive violates any of the provisions set forth in this Agreement
relating to NONINTERFERENCE, Executive acknowledges that the Bank would suffer immediate and
irreparable harm and would not have an adequate remedy at law for money damages. Accordingly,
Executive agrees that, without the necessity of proving actual damages or posting bond or other
security, the Bank shall be entitled to temporary or permanent injunction or injunctions to prevent
breaches of such performance and to specific enforcement of such covenants in addition to any other
remedy to which the Bank may be entitled, at law or in equity. In such a situation, the parties
agree that the Bank may pursue any remedy available, including declaratory relief, concurrently or
consecutively in any order as to any breach, violation, or threatened breach or violation of any of
the provisions set forth in this Agreement relating to NONINTERFERENCE, and the pursuit of any
particular remedy or remedies shall not be deemed an election of remedies or waiver of the right to
pursue any other remedy.

 

 

F. TERMINATION

     23. The Board of Directors shall be entitled to terminate this Agreement, for any reason, by
providing the Executive with thirty (30) days written notice of the termination. However, if this
Agreement is terminated by the Bank without Good Cause, as defined in this Agreement, the Executive
shall be entitled to continue in the employment of the Bank under the terms and conditions that
were in effect as of the date the Bank gives notice of termination for the one (1) year period
following the date the Bank gives notice of termination.

     24. For purposes of this Agreement, “Good Cause” shall be defined as the occurrence of one of
the following events:

a. The determination of the Board of Directors, in the exercise of its reasonable judgment, that
Executive has violated any provision of this Agreement or is grossly negligent in the performance
of his duties hereunder, and has failed to cure such violation or the effects of such gross
negligence within a reasonable period after written notice to the Executive by the Bank specifying
in reasonable detail the alleged violation;

b. The determination of the Board of Directors, in the exercise of its reasonable judgment, that
(i) Executive has failed to follow the policies adopted by the Board of Directors and has failed to
cure such failure within a reasonable period after written notice to the Executive by the Bank
specifying in reasonable detail the alleged failure; or (ii) Executive has engaged in such actions
or omissions that would constitute unsafe or unsound banking practices;

c. The Executive is convicted of a misdemeanor involving moral turpitude or a felony;

d. The determination of the Board of Directors, in the exercise of its reasonable judgment, that
the Executive has engaged in gross misconduct in the course and scope of his employment with the
Bank including indecency, immorality, gross insubordination, dishonesty, unlawful harassment, use
of illegal drugs, or fighting;

e. The determination of the Board of Directors, in the exercise of its reasonable judgment and in
good faith, that the Executive’s job performance is substantially unsatisfactory and that Executive
has failed to cure such performance within a reasonable period after written notice to the
Executive by the Bank specifying in reasonable detail the nature of the unsatisfactory performance;
or

f. The Executive is prohibited from engaging in the business of banking by any governmental
regulatory agency having jurisdiction over the Bank.

Notwithstanding anything in this Agreement to the contrary, Executive will not be in breach of this
Agreement and his action or failure to act shall not be a basis for termination for Good Cause if
Executive’s action or failure to act would constitute an unsafe or unsound banking practice or be
reasonably expected to have a material adverse effect on the financial or regulatory condition of
the Bank.

     25. Executive shall be entitled to terminate this Agreement at any time, for any reason, with
or without cause, by providing thirty (30) days written notice to the Bank. The effective date of
such resignation shall be the 30th calendar day following the date the notice is given
or such other later date as may be set forth in the notice. Upon Executive’s resignation,
Executive shall be entitled to receive any base salary which has been earned by him through the
effective date of such resignation.

     26. If Executive dies during the term of this Agreement and while in the employ of the Bank,
this Agreement will terminate automatically, without notice, on the date of the Executive’s death
and the

 

 

Bank shall have any further obligation to Executive or his estate under this Agreement (other
than death benefits payable under any benefit plans to which Executive is a party), except that the
Bank shall pay Executive’s estate that portion of Executive’s base salary accrued through the date
on which Executive’s death occurred. To the maximum extent, and for the term, permitted by the
health benefit provisions of the Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1986, if
Executive dies during the term of this Agreement and while in the employ of the Bank, the Bank
shall provide or maintain health insurance benefits, at the Bank’s expense, for Executive’s spouse.

     27. The Executive acknowledges and agrees that this Agreement will terminate immediately,
without notice, in the event the Executive becomes physically or mentally disabled, as defined by
29 C.F.R. § 1630.2(g)(1), and cannot perform the essential functions of his position, with or
without reasonable accommodation for the period designated by the Executive’s disability insurance
after which disability payments will begin. In the event of a termination pursuant to this
Section, the Bank shall be relieved of all its obligations under this Agreement, except that the
Bank shall pay to Executive, or his estate in the event of his subsequent death, Executive’s base
salary through the date on which such termination shall have occurred, reduced during such period
by the amount of any benefits received by Executive under any disability policy maintained by the
Bank.

     28. Executive acknowledges that all memoranda, notes, records, reports, manuals, books,
papers, letters, client and customer lists, contracts, software programs, information and records,
drafts of instructions, guides and manuals, and other documentation (whether in draft or final
form), and other sales or financial information and aids relating to the Bank’s business, and any
and all other documents containing confidential information furnished to Executive by any
representative of the Bank or otherwise acquired or developed by Executive in connection with his
duties under this Agreement (collectively, “Recipient Materials”) shall at all times be the
property of the Bank. Within three calendar days of the termination of this Agreement, Executive
shall return to the Bank, any Recipient Materials which are in his possession, custody or control.

     29. The provisions of provisions of Paragraphs 14, 15, 19-22, 28-34, 39, 42, 43 and 45 shall
survive the termination of this Agreement.

G. SEVERABILITY

     30. If any term or other provision of this Agreement is held to be illegal, invalid or
unenforceable by any rule of law or public policy, (A) such term or provision shall be fully
severable and this Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision were not a part hereof; (B) the remaining provisions of this Agreement
shall remain in full force and effect and shall not be affected by such illegal, invalid or
unenforceable provision or by its severance from this Agreement; and (C) there shall be added
automatically as a part of this Agreement a provision as similar in terms to such illegal, invalid
or unenforceable provision as may be possible and still be legal, valid and enforceable. If any
provision of this Agreement is so broad as to be unenforceable, the provision shall be interpreted
to be only as broad as is enforceable.

H. WAIVER

     31. The parties acknowledge and agree that the failure of either to enforce any provision of
this Agreement shall not constitute a waiver of that particular provision, or of any other
provisions of this Agreement.

 

 

I. SUCCESSORS AND ASSIGNS

     32. The Executive acknowledges and agrees that, this Agreement may be assigned by the Bank to
any successor-in-interest and shall inure to the benefit of, and be fully enforceable by, any
successor and/or assignee; and this Agreement will be fully binding upon, and may be enforced by
the Executive against, any successor and/or assignee of the Bank. In the event of any conflict
between this Paragraph 32 and the Change in Control provisions set forth in Section G, above, the
terms of Section G shall control.

     33. The Executive acknowledges and agrees that his obligations, duties and responsibilities
under this Agreement are personal and shall not be assignable, and that this Agreement shall be
enforceable by the Executive only. In the event of the Executive’s death, this Agreement shall be
enforceable by the Executive’s estate, executors and/or legal representatives, only to the extent
provided herein.

J. CHOICE OF LAW

     34. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND ALL QUESTIONS
CONCERNING THE CONSTRUCTION, VALIDITY, INTERPRETATION AND PERFORMANCE OF THIS AGREEMENT SHALL BE
GOVERNED BY, THE LAWS OF THE STATE OF MICHIGAN, WITHOUT GIVING EFFECT TO PROVISION THEREOF
REGARDING CONFLICT OF LAWS. IT IS STIPULATED THAT MICHIGAN HAS A COMPELLING STATE INTEREST IN THE
SUBJECT MATTER OF THIS AGREEMENT, AND THAT EXECUTIVE HAS OR WILL HAVE REGULAR CONTACT WITH THE
STATE OF MICHIGAN IN THE PERFORMANCE OF THIS AGREEMENT.

K. MODIFICATION

     35. The parties acknowledge and agree that this Agreement and the other agreements and plans
referenced herein constitute the complete and entire agreement between the parties; that each
executed this Agreement based upon the express terms and provisions set forth herein; that, in
accepting employment with the Bank, Executive has not relied on any representations, oral or
written, which are not set forth in this Agreement; that no previous agreement, either oral or
written, shall have any effect on the terms or provisions of this Agreement; and that all previous
agreements, either oral or written, are expressly superseded and revoked by this Agreement. Except
as otherwise expressly provided in this Agreement, no conditions, usage of trade, course of dealing
or performance, understanding or agreement purporting to modify, vary, explain or supplement the
terms or conditions of this Agreement unless hereafter made in writing and signed by the party to
be bound. No waiver shall be deemed a continuing waiver or a waiver of any subsequent breach or
default, either of a similar or different nature, unless expressly so stated in writing.

     36. Except as otherwise expressly provided in this Agreement, no conditions, usage of trade,
course of dealing or performance, understanding or agreement purporting to modify, vary, explain or
supplement the terms or conditions of this Agreement unless hereafter made (i) in writing,
(ii) referencing an express provision in this Agreement, (iii) signed by the Executive, and
(iv) approved by a disinterested majority of the Board of Directors.

L. INDEMNIFICATION

     37. The Bank shall indemnify the Executive against all judgments, penalties, fines, amounts
paid in settlement and reasonable expenses (including, but not limited to, attorneys’ fees)
relating to his

 

 

employment by the Bank to the fullest extent permissible under the law, including, without
limitation, federal and/or state banking laws and regulations, the Michigan Banking Code of 1999,
as amended, the Michigan Business Corporation Act, as amended, and the Bank’s Articles of
Incorporation. To the extent permitted by law, the Bank may purchase such indemnification
insurance as the Board may from time to time determine.

M. ARBITRATION

     38. Any dispute, controversy, or claim arising out of or relating to this Agreement or breach
thereof, or arising out of or relating in any way to the employment of the Executive or the
termination thereof, shall be submitted to arbitration in accordance with the Employment Dispute
Arbitration Rules of the American Arbitration Association. Judgment upon the award rendered by the
arbitrator may be entered in any court of competent jurisdiction. In reaching his or her decision,
the arbitrator shall have no authority to ignore, change, modify, add to or delete from any
provision of this Agreement, but instead is limited to interpreting this Agreement.
Notwithstanding the arbitration provisions set forth in this Agreement, the Executive and the Bank
acknowledge and agree that nothing in this Agreement shall be construed to require the arbitration
of any claim or controversy arising under the NONINTERFERENCE provisions of this Agreement. These
provisions shall be enforceable by any court of competent jurisdiction and shall not be subject to
this Paragraph of the Agreement. The Executive and the Bank further acknowledge and agree that
nothing in this Agreement shall be construed to require arbitration of any claim for workers’
compensation or unemployment compensation.

N. LEGAL CONSULTATION

     39. Each party acknowledges that it has carefully read this agreement, that it has had an
opportunity to consult with his or its attorney concerning the meaning, import and legal
significance of this Agreement, that it understands the terms of the Agreement, that all
understandings and agreements between Executive and the Bank relating to the subjects covered in
this Agreement are contained in it, and that it has entered into the Agreement voluntarily and not
in reliance on any promises or representations by the other than those contained in this Agreement.

O. MISCELLANEOUS

     40. The Executive shall make himself available, upon the request of the Bank, to testify or
otherwise assist in litigation, arbitration, or other disputes involving the Bank, or any of the
directors, officers, employees, subsidiaries, or parent corporations of either, at no additional
cost during the term of this Agreement and at any time following the termination of this Agreement.

     41. The Executive shall not be required to mitigate the amount of any payment provided for in
this Agreement by seeking other employment or otherwise, nor shall the amount of any payment
provided for in this Agreement be reduced by any compensation earned by the Executive as the result
of employment by another employer after the date of termination, or otherwise.

     42. In the event either party institutes arbitration or litigation to enforce or protect its
rights under this Agreement, the prevailing party in such arbitration or litigation shall be
entitled, in addition to all other relief, to reasonable attorneys fees, out-of-pocket costs,
disbursements, and arbitrator’s fees relating to such arbitration or litigation.

     43. This Agreement may be executed simultaneously in two or more counterparts, each of which
shall be deemed an original, but all of which shall together constitute one and the same Agreement.

 

 

     44. The Bank shall have no obligation to set aside, earmark or entrust any fund or money with
which to pay its obligations under this Agreement. The Executive or any successor-in-interest to
Executive shall be and remain simply a general creditor of the Bank in the same manner as any other
creditor having a general unsecured claim. For purposes of the Code, the Bank intends this
Agreement to be an unfunded, unsecured promise to pay on the part of the Bank. For purposes of
Employee Retirement Income Security Act of 1974, as amended (“ERISA”), the Bank intends that this
Agreement not be subject to ERISA. If it is deemed subject to ERISA, it is intended to be an
unfunded arrangement for the benefit of a select member of management, who is a highly compensated
employee of the Bank for the purpose of qualifying this Agreement for the “top hat” plan exception
under sections 201(2), 301(a)(3) and 401(a)(1) of ERISA. At no time shall the Executive have or be
deemed to have any lien nor right, title or interest in or to any specific investment or to any
assets of the Bank. If the Bank elects to invest in a life insurance, disability or annuity policy
upon the life of Executive, the Executive shall assist the Bank by freely submitting to a physical
examination and supplying such additional information necessary to obtain such insurance or
annuities.

     45. When a reference is made in this Agreement to a Paragraph, such reference shall be to a
Paragraph of this Agreement unless otherwise indicated. The headings contained in this Agreement
are for convenience of reference only and shall not affect in any way the meaning or interpretation
of this Agreement. Whenever the words “include”, “includes” or “including” are used in this
Agreement, they shall be deemed to be followed by the words “without limitation.” The words
“hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision in this Agreement. Each use
herein of the masculine, neuter or feminine gender shall be deemed to include the other genders.
Each use herein of the plural shall include the singular and vice versa, in each case as the
context requires or as is otherwise appropriate. The word “or” is used in the inclusive sense.
Any agreement or instrument defined or referred to herein or in any agreement or instrument that is
referred to herein means such agreement or instrument as from time to time amended, modified or
supplemented, including by waiver or consent. References to a person are also to its permitted
successors or assigns.

     46. Executive represents that his service as an employee of the Bank will not violate any
agreement: (i) he has made that prohibits him from disclosing any information he acquired prior to
his becoming employed by the Bank; or (ii) he has made that prohibits him from accepting employment
with the Bank or that will interfere with his compliance with the terms of this Agreement.
Executive further represents that he has not previously, and will not in the future, disclose to
Bank any proprietary information or trade secrets belonging to any previous employer. Executive
acknowledges that the Bank has instructed him not to disclose to it any proprietary information or
trade secrets belonging to any previous employer.

P. NOTICES

     47. All notices and other communications required or permitted to be given or delivered
hereunder or by reason of the provisions of this Agreement shall be in writing and shall be deemed
to have been properly given if (a) delivered personally, (b) delivered by a recognized overnight
courier service, (c) sent by United States mail, or (d) sent by facsimile transmission followed by
a confirmation copy delivered by recognized overnight courier service the next day. Such notices,
requests, consents and other communications shall be sent to the respective parties as follows (or
at such other address for a party as shall be specified by like notice to the other party):

 

 

If to the Bank:

Bank of Birmingham

33583 Woodward Avenue

Birmingham, Michigan 48009

Attention: Chairman

If to Executive:

Lance N. Krajacic, Jr.

 

 

     48. Any notice or other communication given pursuant to this Agreement shall be effective (i)
in the case of personal delivery, telex or facsimile transmission, when received; (ii) in the case
of mail, upon the earlier of actual receipt or five (5) business days after deposit with the United
States Postal Service, first class certified or registered mail, postage prepaid, return receipt
requested; and (iii) in the case of a recognized overnight courier service, one (1) business day
after delivery to the courier service together with all appropriate fees or charges and
instructions for overnight delivery.

     49. This Agreement shall at all times be administered, and the provisions of this Agreement
shall be interpreted, consistent with the requirements of Section 409A and the final regulations
thereunder.

[signature page follows]

 

 

[signature page to Employment Agreement]

EXECUTED ON THIS DATE FIRST WRITTEN ABOVE IN BIRMINGHAM, MICHIGAN.

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	EXECUTIVE	 	 
	 
	 	 	 	 	 	 
	/s/  Barbara Riopelle	 	/s/  Lance N. Krajacic, Jr.	 	 
	 	 	 	 	 
	WITNESS	 	Lance N. Krajacic, Jr.	 	 
	 
	 	 	 	 	 	 
	 	 	BANK OF BIRMINGHAM	 	 
	 
	 	 	 	 	 	 
	/s/  Barbara Riopelle
 

WITNESS

	 	By:
	 	/s/  Henry G. Spellman
 

Henry G. Spellman, 
Chairman-Compensation Committeeexv10w1

Exhibit 10.1

STOCK PURCHASE AGREEMENT

     THIS STOCK PURCHASE AGREEMENT (the “Agreement”) is entered into as of the 16th day
of May, 2009 (the “Effective Date”), by and between ARCADIA PRODUCTS, INC., a Delaware corporation
(the “Stockholder”), and AEROCARE HOLDINGS, INC., a Delaware corporation (the “Buyer”) (each a
“Party” or collectively the “Parties”).

R E C I T A L S :

     A. The Stockholder is the record and beneficial owner of: (1) an aggregate of one thousand
(1,000) shares (“Beacon/Georgia Shares”) of the common stock, $1.00 par value per share, of BEACON
RESPIRATORY SERVICES OF GEORGIA, INC., a Delaware corporation (“Beacon/Georgia”), constituting all
of the issued and outstanding shares of capital stock of Beacon/Georgia as of the date of this
Agreement; (2) an aggregate of ten thousand (10,000) shares (the “Lovell Shares”) of the common
stock, $1.00 par value per share, of LOVELL MEDICAL SUPPLY, INC., a North Carolina corporation
(“Lovell”), constituting all of the issued and outstanding shares of capital stock of Lovell as of
the date of this Agreement; and (3) an aggregate of one thousand (1,000) shares (the “Trinity
Shares”) of the common stock, $0.01 par value per share, of TRINITY HEALTHCARE OF WINSTON-SALEM,
INC., a Georgia corporation (“Trinity”), constituting all of the issued and outstanding shares of
capital stock of Trinity as of the date of this Agreement (the Beacon/Georgia Shares, Lovell Shares
and Trinity Shares are sometimes herein referred to collectively as the “Shares”, and
Beacon/Georgia, Lovell and Trinity are sometimes herein referred to collectively as the
“Corporations” and individually as a “Corporation”).

     B. Beacon/Georgia conducts business operations in the States of Georgia and South Carolina,
Lovell conducts business operations in the State of North Carolina, and Trinity conducts business
operations in the States of Georgia and North Carolina, and each Corporation is engaged in the
business of durable medical equipment and respiratory therapy (collectively, the “Business”).

     C. Stockholder desires to sell to Buyer, and Buyer desires to purchase from Stockholder, all
of the Shares, upon the terms and conditions herein set forth.

     NOW, THEREFORE, in consideration of the mutual promises and conditions herein contained, the
Parties hereto agree as follows:

     1. Incorporation of Recitals. The Recitals made above are incorporated into and made
part of this Agreement by this reference thereto.

     2. Sale and Purchase of Shares. Subject to the terms and conditions of this
Agreement, Stockholder hereby sells, transfers and assigns to Buyer, and Buyer hereby

 

 

purchases from Stockholder, all of the Shares. Stockholder hereby delivers to Buyer
certificates evidencing the Shares duly endorsed to Buyer.

     3. Purchase Price; Method of Payment; Contingent Cash Consideration; Reductions to Cash
Consideration; Cash of the Corporations; Revenues and Proceeds from Payment of Receivables of the
Corporations; Accounts Payable of the Corporations; Allocation of Purchase Price; Weekly
Reconciliation; Etc.

          a. Purchase Price; Method of Payment; Wire Transfers to Certain Creditors. The total
consideration from Buyer to Stockholder in exchange for the Shares is: (I) Four Million Two Hundred
Seventy-Five Thousand Dollars ($4,275,000) in cash (the “Cash Consideration”), less the aggregate
amounts set forth in Section 3.c hereof (if any), plus (II) Four Hundred Seventy-Five Thousand
Dollars ($475,000) in cash, subject to offsets and reductions as set forth in Section 3.b hereof
(the “Contingent Cash Consideration”) (the Cash Consideration and Contingent Cash Consideration are
collectively referred to herein as the “Purchase Price”). The Cash Consideration, less the
aggregate amounts set forth in Section 3.c hereof (if any) and less $1,173,527 (representing the
aggregate amount to be wired to certain creditors of the Stockholder as described at the end of
this Section 3.a), will be paid by Buyer to Stockholder on the Closing Date (or on the next banking
day following the Closing Date if all documents contemplated to be executed at Closing were fully
executed after 12:01 p.m., E.D.T., on the Closing Date) by wired funds to Stockholder’s account
number as set forth on the Schedule of Wire Instructions attached hereto as Exhibit 3-A. The
Contingent Cash Consideration shall be payable pursuant to the terms of Section 3.b hereof. The
Stockholder requests and authorizes Buyer to redirect a portion of the Cash Consideration due at
Closing to the following creditors of Stockholder in the following amounts: (1) $391,176 to Jana
Master Fund, Ltd. pursuant to wire transfer instructions provided by Stockholder to Buyer on or
before the Closing Date; and (2) $782,351 to Vicis Capital Master Fund pursuant to wire transfer
instructions provided by Stockholder to Buyer on or before the Closing Date.

          b. Contingent Cash Consideration. The Contingent Cash Consideration shall be held
back by Buyer without interest, during the period commencing on the Closing Date and ending three
hundred sixty (360) days after the Closing Date (the “Hold Back Period”), to secure all obligations
of Stockholder to Buyer (whether such obligations are pursuant to this Agreement or pursuant to any
other agreement between Buyer and Stockholder) , including but not limited to all of the
obligations of Stockholder to Buyer set forth in: (A) Section 3.e hereof entitled Revenues and
Proceeds from Payment of Receivables of the Corporations; (B) Section 3.f hereof entitled
Accounts Payable of the Corporations; (C) Section 4 hereof entitled Right of Offset
Against the Contingent Cash Consideration; and (D) Section 13 hereof entitled
Indemnification; Remedies.

               i. Offset and Reduction of Contingent Cash Consideration in the Event of Default. In
the event Stockholder fails to meet any of its obligations to Buyer under this Agreement, or
otherwise is in default of any provision of this Agreement (each such failure is sometimes herein
referred to as a “default” or an “event of default”), Buyer shall give written notice of the
alleged default to Stockholder. Upon the passage of not less than thirty (30) days from receipt of
said notice of alleged default from Buyer (unless during such thirty (30) day

2

 

period, Buyer shall have received notice from Stockholder that Stockholder has elected to
defend the dispute pertaining to an event of default involving a debt or liability), the Buyer may
at any time thereafter wholly or partially make offset against and thereby reduce the amount of
Contingent Cash Consideration payable to Stockholder hereunder. Notwithstanding the foregoing, in
the case of a “Dispute” (as defined in Section 13 of this Agreement), the provisions of Section 13
of this Agreement applicable to a “Dispute” shall govern, and no offset and reduction against the
Contingent Cash Consideration shall occur until the applicable “Dispute” is resolved in accordance
with the provisions of Section 13 hereof.

               ii. Partial Release and Final Release; Effect of Release of Contingent Cash
Consideration. One Hundred Sixty Thousand Dollars ($160,000) of the Contingent Cash
Consideration, less any amounts previously offset and reduced by Buyer pursuant to this Agreement,
shall be released to Stockholder on or before that date which is one hundred twenty (120) days
after the Closing Date (the “First Partial Release Date”), One Hundred Sixty Thousand Dollars
($160,000) of the Contingent Cash Consideration, less any amounts previously offset and reduced by
Buyer pursuant to this Agreement, shall be released to Stockholder on or before that date which is
two hundred forty (240) days after the Closing Date (the “Second Partial Release Date”), and the
remaining Contingent Cash Consideration (not released to Stockholder on the First Partial Release
Date or Second Partial Release Date), less any amounts previously offset and reduced by Buyer
pursuant to this Agreement, shall be released to Stockholder on or before that date which is three
hundred sixty (360) days after the Closing Date (the “Final Release Date”), provided, however, that
notwithstanding anything contained in this Agreement to the contrary, the right of Buyer to make
offset against and reduce the Contingent Cash Consideration shall extend past the First Partial
Release Date, Second Partial Release Date and/or Final Release Date in the event: (i) a claim is in
dispute at the time of the First Partial Release Date, Second Partial Release Date and/or Final
Release Date and, in such instance, the Buyer’s right to make offset against and reduce the
Contingent Cash Consideration shall not terminate until after the settlement of such claim or
claims; or (ii) the Contingent Cash Consideration to be reduced pursuant to Section 4 of this
Agreement has not been finally determined and, in such instance, the Buyer’s right to make offset
against and reduce the Contingent Cash Consideration shall not terminate until such time as all
calculations required by Section 4 hereof have been finally determined and all reductions of the
Contingent Cash Consideration required by Section 4 hereof (if any) have been made. In the event
the right of offset is extended past the First Partial Release Date, Second Partial Release Date
and/or Final Release Date because a claim is in dispute, Contingent Cash Consideration having a
value equal to that amount which is 130 percent of the amount of the claim asserted by Buyer shall
continue to be held back by Buyer past the First Partial Release Date, Second Partial Release Date
and/or Final Release Date until such claim is resolved.

          c. Reductions to Cash Consideration. The Cash Consideration to be delivered at
Closing shall be reduced, dollar for dollar, by the aggregate amount of ZERO DOLLARS ($-0-), which
amount Stockholder represents and warrants is sufficient to reduce the Corporations’ “Aggregate
Existing Obligations” (as defined in Section 6.d hereof) to Zero Dollars ($-0-). Stockholder
represents and warrants to Buyer that the following obligations, which otherwise would have reduced
the amount of the Cash Consideration to be delivered at Closing, were satisfied by payment in full
prior to the Closing Date: (A) $71,289.83,

3

 

representing the amount owed by Stockholder and/or its affiliates to GMAC through the
Effective Date; (B) $25,000.00, representing the final settlement obligation owed by Arcadia
Resources, Inc. and/or its affiliates to Dargon Smith, Jr. and Sue Smith in settlement of Case Nos.
2008-CP-15-172 and 492 (collectively, the “Smith Cases”), each filed in the County of Colleton,
State of South Carolina; and (C) $5,915.22, representing the final installments owed by Arcadia
Resources, Inc. and/or its affiliates to Parelsu II, LLP under that certain letter agreement dated
November 20, 2008, which letter agreement set forth the terms pertaining to the settlement of that
certain lease dispute involving leased property having a street address of 416A Robertson Blvd.,
Walterboro, South Carolina 29488. Stockholder shall provide to Buyer, on or before the Closing
Date, confirmation of the payment of such amounts (including, in the case of the GMAC payment,
copies of the electronic receipts of such payments/payoffs to GMAC), and shall provide to Buyer
post-Closing, a copy of the signed Release and Indemnification Agreement pertaining to the Smith
Cases, promptly after such document has been executed by Dargon Smith, Jr. and Sue Smith.

Not later than that date which is ten (10) days from the Closing Date, Stockholder shall cause to
be obtained from the following secured parties, and filed with the Secretary of State of Delaware
for Beacon/Georgia, the Secretary of State of North Carolina for Lovell and the Secretary of State
of Georgia for Trinity, Form UCC-3 Termination Statements terminating the following Form UCC-1
Financing Statements:

	 	(1)	 	Form UCC-1 Financing Statement, filed on April 1, 2008, listing Jana Master Fund, Ltd
as Secured Party and Beacon/Georgia as Debtor;
	 
	 	(2)	 	Form UCC-1 Financing Statement, filed on April 1, 2008, listing Jana Master Fund, Ltd
as Secured Party and Lovell as Debtor; and
	 
	 	(3)	 	Form UCC-1 Financing Statement, filed on April 2, 2008, listing Jana Master Fund, Ltd
as Secured Party and Trinity as Debtor.

Except for the above referenced UCC-1 Financing Statements of Jana Master Fund, Ltd., Stockholder
is not aware of any other active UCC-1 Financing Statements imposing a lien on or otherwise
encumbering any of the assets of the Corporations, nor has Stockholder or any of such Corporations
authorized the filing of any UCC-1 Financing Statements from January 1, 2009 through the Closing
Date which would impose a lien on or otherwise encumber any of the assets of the Corporations.

          d. Cash of the Corporations. Stockholder is entitled to the cash and cash balances of
each Corporation pertaining to the operation of the Business through May 15, 2009 (the “Excluded
Cash”), and Buyer is entitled to the cash and cash balances of each Corporation pertaining to the
operation of the Business after May 15, 2009. In the event the Excluded Cash has not been reduced
to Zero Dollars ($0) as of the Closing Date, the Buyer agrees to remit to Stockholder the remaining
portion of the Excluded Cash. In the event the Excluded Cash is a negative amount for any reason
(e.g., overdrafts, outstanding checks which have not cleared, etc.), the Stockholder shall
immediately make payment to Buyer in such amount as will bring the negative balance back to Zero
Dollars ($0).

4

 

          e. Revenues and Proceeds from Payment of Receivables of the Corporations. Stockholder
is entitled to all revenues and proceeds actually received by each Corporation on or before May
15, 2009 as a result of the payment of accounts receivable generated by each Corporation’s
operation of its respective Business through May 15, 2009 (collectively, the “Excluded Accounts
Receivable Proceeds”). Buyer, through each of the Corporations, is entitled to all revenues and
proceeds received on and after May 16, 2009 as a result of the payment of accounts receivable
generated by each Corporation’s operation of its respective Business (collectively, the “Included
Accounts Receivable Proceeds”). Notwithstanding anything contained in this Agreement to the
contrary, any Medicare refunds or recoupments pertaining to any Excluded Accounts Receivable
Proceeds shall be the responsibility of Stockholder and its ultimate parent corporation, Arcadia
Resources, Inc., a Nevada corporation, and their successors and assigns. Notwithstanding anything
in this Agreement to the contrary, for a five (5) year period following the Closing Date,
Stockholder indemnifies and holds each Corporation and the Buyer harmless from and against any and
all such Medicare refunds or recoupments and from any other liabilities, obligations or claims of
any kind pertaining to the Excluded Accounts Receivable Proceeds, and any business activity related
thereto, and authorizes Buyer to make offset against the Contingent Cash Consideration in the event
Buyer has a claim against Stockholder pursuant to this indemnification.

          f. Accounts Payable of the Corporations. Stockholder hereby agrees, and Arcadia
Resources, Inc. and RKDA, Inc. in their respective Guaranty Agreements shall be required to agree,
that: (A) Stockholder, Arcadia Resources, Inc. and RKDA, Inc. shall be and hereby are jointly and
severally liable for all of the accounts payable obligations of each of the Corporations (whether
due and owing, not yet due and owing, billed or unbilled, accrued or not accrued or contingent or
not contingent), pertaining to the operation of the Business through May 15, 2009, including but
not limited to all of the accounts payable listed on the Schedule of Accounts Payable Data attached
hereto as Exhibit 6-R, which Stockholder represents and warrants is an accurate and complete list
of all of such accounts payable through the close of business on April 30, 2009, with respect to
the A/P schedule through April 30, 2009 delivered by Stockholder to Buyer at Closing (the “April
30, 2009 A/P Schedule”), and an accurate and complete list of all of such accounts payable through
the close of business on May 15, 2009, with respect to the A/P schedule through May 15, 2009 to be
delivered by Stockholder to Buyer post-closing (the “May 15, 2009 A/P Schedule”) (collectively, the
“Pre-Existing Accounts Payable Obligations”) and that Exhibit 6-R includes all of the accrued
payroll of each of the Corporations through April 30, 2009 (with respect to the April 30, 2009 A/P
Schedule) and through May 15, 2009 (with respect to the May 15, 2009 A/P Schedule), and all of the
accrued vacation obligations of each of the Corporations through April 30, 2009 (with respect to
the April 30, 2009 A/P Schedule) and May 15, 2009 (with respect to the May 15, 2009 A/P Schedule);
and (B) Stockholder, Arcadia Resources, Inc. and RKDA, Inc. shall cause the Pre-Existing Accounts
Payable Obligations (other than those disputed in good faith without any impact on the respective
Businesses of the Corporations, which dispute status shall in no way alter the provisions of this
Section 3.f which place sole responsibility for payment of any Pre-Existing Accounts Payable
Obligations on Stockholder, Arcadia Resources, Inc. and RKDA, Inc., and not on Buyer) to be paid
when due and shall, in any event, pay off and satisfy in full all of such Pre-Existing Accounts
Payable Obligations no later than by that date which is ninety (90) days from the Closing Date, as
to Pre-Existing Accounts Payable Obligations listed on Exhibit

5

 

6-R, and by that date which is one-hundred ten (110) days from the Closing Date, as to
Pre-Existing Accounts Payable Obligations not listed on Exhibit 6-R (that date which is one-hundred
ten (110) days from the Closing Date is herein referred to as the “Final Date for A/P Payments”),
provided, however, that any portion of the Pre-Existing Accounts Payable Obligations consisting of
accrued payroll obligations through May 15, 2009, shall be paid in full by Stockholder or
Stockholder’s ultimate parent corporation, Arcadia Resources, Inc., on or before June 15 2009, and
any portion of the Pre-Existing Accounts Payable Obligations consisting of accrued vacation
obligations through May 15, 2009, shall be paid in full by Stockholder or Stockholder’s ultimate
parent corporation, Arcadia Resources, Inc. on or before June 15, 2009, such that all of the
employees of each Corporation as of May 16, 2009 will have no accrued payroll owing to any of them
by each such Corporation for periods before such date nor will have any accrued vacation owing to
them by each such Corporation for periods before such date. In the event Stockholder, Arcadia
Resources, Inc. and/or RKDA, Inc. fail to pay in full all Pre-Existing Accounts Payable Obligations
by the Final Date for A/P Payments, Buyer shall have the right in the exercise of its sole
discretion, but not the obligation, to pay any of the Pre-Existing Accounts Payable Obligations on
behalf of Stockholder, Arcadia Resources, Inc. and RKDA, Inc. and make offset against the
applicable portion of any Contingent Cash Consideration to be delivered by Buyer to Stockholder
pursuant to Section 3.b hereof. In the event of such non-payment by Stockholder, Arcadia
Resources, Inc. and/or RKDA, Inc. of all of the Pre-Existing Accounts Payable Obligations by the
Final Date of A/P Payments, Buyer shall also have all other remedies set forth in this Agreement or
under applicable law. Notwithstanding anything in this Agreement to the contrary, after the Final
Date for A/P Payments, the Buyer shall at all times have the right to make written demand on the
Stockholder to pay any Pre-Existing Accounts Payable Obligations which became known or arose after
the Final Date for A/P Payments and, in such event, the Stockholder shall pay the Pre-Existing
Accounts Payable Obligations within fifteen (15) business days from the date of receipt of such
written demand and shall provide Buyer with such proof of payment as Buyer may reasonably request.
Stockholder covenants and agrees to deliver the May 15, 2009 A/P Schedule to Buyer on or before May
31, 2009. Stockholder represents and warrants to Buyer that Stockholder is not aware of any
accounts payable obligations incurred after April 30, 2009 through May 15, 2009, which are outside
the ordinary course of business or which involve accounts payable obligations of a different type
or category than those accounts payable obligations listed on the April 30, 2009 A/P Schedule.
Stockholder has disclosed to Buyer that the April 30, 2009 A/P Schedule and the May 15, 2009 A/P
Schedule may also include accounts payable data pertaining to business entities other than the
Corporations due to the difficulty of separating out and segregating such data.

          g. Allocation of Purchase Price. The Purchase Price shall be allocated among the
assets of each Corporation as set forth on Exhibit 3-G, which allocation shall be jointly prepared
and agreed to by Buyer and Stockholder and attached to this Agreement no later than by June 30,
2009. It is agreed that the allocations under this Section will be binding on all parties for
Federal, state, local and other tax purposes in connection with this sale, and will be consistently
reflected by each Party on its tax returns. The Parties shall execute and attach hereto as Exhibit
3-H, not later than by June 30, 2009, any forms required by Section 338(h)(10) of the Internal
Revenue Code, as amended, on the subject of the allocation of the Purchase Price among

6

 

the assets of each of the Corporations, and Buyer shall allocate the Purchase Price among the
assets of each Corporation in accordance with such forms.

          h. Weekly Reconciliation; Progress Updates on A/P Payoffs. Commencing during the week
of May 18, 2009, and weekly thereafter or on such other periodic basis as the parties hereto shall
agree, and for so long as is reasonably necessary to accomplish the objectives set forth in this
subsection, a representative of the Buyer and representative of the Stockholder shall meet on such
basis as they shall decide (whether in person, telephonically or electronically via e-mail) in an
effort to reconcile the various obligations of the parties under this Agreement, including without
limitation, the allocation of cash in the Corporation, the distribution of proceeds from accounts
receivable, the status of payoffs of accounts payable, the settlement and proper allocation of
pre-Closing and post-Closing expenses (such as rent and similar expenses), including expenses paid
by one party which should properly be allocated to the other party, adjustments for the
underpayment of any liabilities which should have been paid in full at Closing, etc. Such
representatives may establish whatever procedures and worksheets for such reconciliation as they
may reasonably determine. The Stockholder shall prepare and submit to Buyer, on those dates which
are thirty (30), sixty (60), ninety (90) and one hundred ten (110) days from the Closing Date, a
detailed written status update on the progress made to date in the payment of all of the accounts
payable required to be paid off pursuant to Section 3.f hereof (each, an “A/P Status Report”).
Stockholder covenants and agrees that each A/P Status Report will confirm to Buyer that
Stockholder, Arcadia Resources, Inc. and RKDA, Inc. have been diligent in their efforts to pay off
such accounts payable and that such obligated entities have made a reasonable effort to cause such
accounts payable to be paid off on a timely basis.

          i. Rossville Billing Center Transition. The terms and conditions set forth on that
certain List of Agreements Pertaining to the Rossville Billing Center Transition, attached hereto
as Exhibit 3-I, have been agreed to by Stockholder and Buyer, and all of such terms and conditions
are hereby incorporated into this Agreement by this reference thereto and made a part hereof. All
references to “Arcadia” on Exhibit 3-I shall refer to Stockholder and/or Arcadia Resources, Inc.
(as the context shall require or permit), and Stockholder represents to Buyer that Stockholder is
the tenant under the current lease pertaining to the Rossville, Indiana Billing Center location,
and that Arcadia Resources, Inc. is the current employer of the billing center personnel but has
authorized Stockholder to enter into the terms set forth on Exhibit 3-I on its behalf.

          j. Assignment of Rights. Stockholder acknowledges that Stockholder entered into
certain material agreements with certain employees of the Corporations rather than have the
applicable Corporation enter into such agreements. Stockholder hereby assigns any and all rights
(but not obligations) which Stockholder has under any and all employment agreements,
confidentiality agreements, non-competition agreements, non-solicitation agreements and any other
agreements containing restrictive covenants, which pertain to any current or former employees of
any of the three Corporations, including but not limited to that certain Non-Competition Agreement
dated as of August 25, 2006, by and among the Stockholder and Darian Byrd a/k/a Herbert Darian
Byrd, Jerry Lovell, Donald H. Martinat III, Kathryn Martinat, Harvey Arrington, Jean Arrington
a/k/a Imogene Arrington, Randall Strickland and Tonda Strickland (the “2006 Non-Compete
Agreement”). Stockholder represents and warrants to Buyer that the

7

 

2006 Non-Compete Agreement is in full force and effect based on the form of such document as
of August 25, 2006, that the 2006 Non-Compete Agreement has not been amended or previously
assigned, and that the scope of the restrictive covenants set forth in the 2006 Non-Compete
Agreement have not been limited or reduced in scope or duration.

          k. Reimbursement of Rent at Winston-Salem Location. After the Closing, Stockholder
plans to continue to use, for a short period, a portion of the space at the Winston-Salem, North
Carolina, location of a Corporation. In exchange for such use, Stockholder agrees to pay Buyer the
sum of One Thousand Dollars ($1,000) per month (prorated for periods which are less than a full
month), with such amount due when rent is due under the applicable Winston-Salem lease agreement.
Either party may terminate this arrangement by providing written notice to the other party.

          l. CPAP Supply Inventory. Stockholder represents to Buyer that one of the
Corporations maintains CPAP supply inventory (segregated by location) at its Winston-Salem, North
Carolina location, including CPAP supply inventory segregated for locations of the Stockholder in
the Midwest region of the United States (the “Midwest CPAP Supply Inventory”). On or before the
close of business on the Closing Date, Stockholder shall notify Buyer in writing or by e-mail
whether or not it has further need for any of the Midwest CPAP Supply Inventory after the Closing
Date. If Stockholder discloses to Buyer that it no longer has a need for any of the Midwest CPAP
Supply Inventory after the Closing Date (or if Stockholder fails to notify Buyer in writing or by
e-mail of such need before the close of business on the Closing Date), the Midwest CPAP Supply
Inventory shall be deemed to be owned solely by Buyer as of the Closing Date for no additional
consideration. If Stockholder discloses to Buyer before the close of business on the Closing Date
that Stockholder has a further need for CPAP supplies, then Buyer agrees to continue to ship CPAP
supplies to Stockholder’s Midwest locations (out of the segregated Midwest CPAP Supply Inventory)
as Stockholder shall request, at no cost to Stockholder except for related shipping costs, until
the earlier of the following dates: (A) the date on which the segregated Midwest CPAP Supply
Inventory runs out; or (B) May 31, 2009. After May 31, 2009, Buyer may, in the exercise of its
sole discretion, continue to honor Stockholder requests for CPAP supplies but, if Buyer agrees to
ship out any CPAP supplies for Stockholder after May 31, 2009, Stockholder agrees to pay Buyer an
amount equal to the fair cost of such CPAP supplies plus related shipping costs.

          m. Pitney Bowes Postage Metering Equipment. Stockholder has disclosed to Buyer that
Stockholder or a Corporation may be obligated under three (3) lease arrangements involving Pitney
Bowes postage metering equipment (the “Pitney Bowes Equipment”) located at the Smyrna, Georgia
location (lease with fixed term), Huntersville, North Carolina location (month to month lease), and
Winston-Salem, North Carolina location (month to month lease). Within thirty (30) days following
the Closing Date, Buyer shall evaluate its needs regarding the Pitney Bowes Equipment and, if Buyer
determines it has no need for the Pitney Bowes Equipment at a particular location, Buyer will
notify Stockholder of that fact and Stockholder shall retrieve the applicable Pitney Bowes
Equipment and assume any related lease obligations or, in the case of the month to month leases,
shall have Buyer return the applicable Pitney Bowes Equipment to Pitney Bowes at Stockholder’s
expense. In the event Buyer decides to keep any

8

 

Pitney Bowes Equipment, Buyer shall assume the related lease obligations and agrees to execute
any documents required to reflect such assumption.

     4. Right of Offset Against the Contingent Cash Consideration. In addition to any
other rights of offset or reduction set forth in this Agreement, in the event that: (i) any of the
Corporations have any debts or liabilities of any kind as of the Effective Date, other than the
debts and liabilities of each such Corporation described on, and not in excess of the dollar
amounts listed on, the Schedule of Liabilities attached hereto as Exhibit 6-D (the “Liabilities
Deficiency”), or (ii) any of the Corporations have, since January 31, 2009, made expenditures or
incurred obligations or liabilities, except in the ordinary course of business; discharged or
satisfied any liens or encumbrances, except in the ordinary course of business; declared or made
any payment or distribution (excluding inter-company cash transactions in the ordinary course of
business) to Stockholder or purchased or redeemed any of its common capital stock or agreed to do
so; mortgaged, pledged or subjected to lien or encumbrance any of its assets; sold or transferred
any assets, except in the ordinary course of business; suffered any damage or loss (whether or not
covered by insurance), materially affecting its properties; waived any rights of substantial value;
or entered into any transaction other than in the ordinary course of business (the “Subsequent
Event Deficiency”), or (iii) any debts, liabilities or obligations of any nature (whether absolute,
accrued, contingent or otherwise) (the “Obligations”), other than those subject to subsections (i)
and (ii) of this Section 4, become known, are uncovered or arise after the Effective Date, which
Obligations pertain to any actions, omissions, debts, liabilities or obligations of any of the
Corporations or Stockholder, created or arising on or before the Effective Date (said Obligations
are hereinafter referred to as the “Contingent Liability”) (a Liabilities Deficiency, Subsequent
Event Deficiency or Contingent Liability is sometimes herein referred to as a “Claim”); then, and
in any of such events, Buyer shall have the right, during the Hold Back Period (or after the Hold
Back Period if permitted under Section 3.b.ii hereof), to make offset against the Contingent Cash
Consideration in accordance with the terms and conditions of Section 3.b hereof, in amounts from
time to time equal to any Liabilities Deficiency, Subsequent Event Deficiency or Contingent
Liability which becomes known, is uncovered or arises during the three hundred sixty (360) day
period after the Closing Date (subject, however, in the event of a “Dispute”, to the provisions of
Section 13 hereof applicable to a “Dispute”). During the three hundred sixty (360) day period
following the Closing Date, in the event Buyer makes written request to Stockholder hereunder for
Stockholder to pay any Liabilities Deficiency, Subsequent Event Deficiency or Contingent Liability,
and Stockholder fails to make the requested payment within thirty (30) days from the date of such
written request (said thirty (30) day period hereinafter referred to as the “Notice Period”), Buyer
shall have the right to make offset against and reduce the Contingent Cash Consideration, in
accordance with the terms and conditions of Section 3.b hereof, in amounts from time to time equal
to the amount of any Liabilities Deficiency, Subsequent Event Deficiency or Contingent Liability
which becomes known, is uncovered or arises during the three hundred sixty (360) day period
following the Closing Date (subject, however, in the case of a “Dispute”, to the provisions of
Section 13 hereof applicable to a “Dispute”), and Stockholder agrees to allow Buyer to make offset
against and reduce the Contingent Cash Consideration as provided in this Agreement. Except as
provided in Section 3.b.ii hereof, Buyer’s right of offset against the Contingent Cash
Consideration shall terminate on that date which is three hundred sixty (360) days from the Closing
Date; provided, however, that notwithstanding anything contained in this Agreement to

9

 

the contrary, the rights of offset shall extend past the First Partial Release Date, Second
Partial Release Date and/or Final Release Date (the “Applicable Release Date”) in the event a Claim
is in dispute at the time of the Applicable Release Date and, in such instance, the right of offset
shall not terminate until after the settlement of such Claim or Claims. In the event the right of
offset is extended past the Applicable Release Date because a Claim is in dispute, that amount of
Contingent Cash Consideration equal to the amount of such claim, plus a reserve equal to 30% of the
amount of such Claim, shall continue to be held back by Buyer past the Applicable Release Date
until such Claim is resolved, with the remaining Contingent Cash Consideration released to Buyer
within fifteen (15) days after the Applicable Release Date. Subject to Section 13 hereof, Buyer
shall be entitled to reimbursement from Stockholder of the amount of any reasonable legal fees and
expenses (including court costs and the costs of appeal) incurred by Buyer to enforce the
collection of amounts owed Buyer by Stockholder hereunder, provided Buyer is the prevailing party
in any such collection action; however, if Stockholder is the prevailing party in any such
collection action, Stockholder shall be entitled to reimbursement from Buyer of the amount of any
reasonable legal fees and expenses (including court costs and the costs of appeal) incurred by
Stockholder to defend itself in such collection action.

     5. Effective Date; Closing Date. The effective date for the transactions contemplated
under this Agreement will be 12:01 a.m. on May 16, 2009 (the “Effective Date”); however, subject to
the terms of this Agreement, the actual closing of the transactions contemplated under this
Agreement shall take place on May 18, 2009, unless extended by written agreement of the Parties.
The date upon which such Closing shall occur is hereinafter referred to as the “Closing” or
“Closing Date.” Closing shall take place at such place or in such a manner as may be agreed upon
by the Parties.

     6. Representations and Warranties by Stockholder. Stockholder represents and warrants
to Buyer that each of the following representations and warranties is true and correct as of the
Effective Date and again as of the Closing Date, and is made with the full understanding that such
representations and warranties constitute material inducement to Buyer to enter into the
transactions contemplated hereby:

          a. Organization of the Corporations; Qualification; Power and Authority.
Beacon/Georgia is a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware, Lovell is a corporation duly organized, validly existing and in good
standing under the laws of the State of North Carolina, and Trinity is a corporation duly
organized, validly existing and in good standing under the laws of the State of Georgia, with each
such Corporation having all requisite corporate power and authority to carry on its business as
presently conducted. Beacon/Georgia is registered or qualified to do business in the States of
Georgia and South Carolina and in all other jurisdictions where the nature of Beacon/Georgia’s
business requires such registration or qualification, Lovell is registered or qualified to do
business in all other jurisdictions where the nature of Lovell’s business requires such
registration or qualification, and Trinity is registered or qualified to do business in the States
of North Carolina and South Carolina and in all other jurisdictions where the nature of Trinity’s
business requires such registration or qualification, except where failure of any such Corporation
to be so qualified would not have a material adverse affect on the Business or on such
Corporation’s business, assets, results of operations, prospects or condition (financial or
otherwise).

10

 

Stockholder warrants and represents that Trinity is not registered to do business in the State
of South Carolina and that Trinity is not obligated to the State of South Carolina. None of the
Corporations are in default under any provisions of their respective Articles of Incorporation, as
amended, or their respective By-laws, as amended. None of the Corporations have subsidiaries nor
has any direct or indirect equity interest in any other firm, corporation or business enterprise.
A complete listing of the Officers and Directors of each Corporation is attached hereto as Exhibit
6-A.

          b. Capitalization and Long Term Indebtedness.

               i. Beacon/Georgia is authorized by its Articles of Incorporation to issue one thousand (1,000)
shares of common stock, $1.00 par value per share, of which all one thousand (1,000) shares are
duly and validly issued and outstanding, fully paid, and nonassessable. Lovell is authorized by
its Articles of Incorporation to issue one hundred thousand (100,000) shares of common stock, $1.00
par value per share, of which ten thousand (10,000) shares are duly and validly issued and
outstanding, fully paid, and nonassessable. Trinity is authorized by its Articles of Incorporation
to issue one million (1,000,000) shares of common stock, $0.01 par value per share, of which one
thousand (1,000) shares are duly and validly issued and outstanding, fully paid, and nonassessable.
As to each Corporation, there are no shares of any other class of stock authorized, issued or
outstanding nor are any unissued shares committed to any party by any Corporation. None of the
Corporations has authorized or established any stock appreciation, phantom stock, profit
participation or similar rights or plans with respect to any Corporation. None of the Corporations
has authorized or issued any class of preferred stock or any other class of common capital stock,
nor has any authority to issue any other capital stock, preferred stock or other securities.

               ii. None of the Corporations are in any default or violation of any provision of its
outstanding long term or short-term indebtedness.

               iii. There are no outstanding options, warrants, purchase rights, subscription rights,
conversion rights, exchange rights or other contracts, commitments or agreements of any character
relating to the issuance of capital stock or other securities of any of the Corporations.

               iv. All FICA and Federal and state withholding tax deposits have been timely and fully
reported and paid by each Corporation.

               v. Except as set forth in Exhibit 6-B, as to each Corporation, there are no outstanding or
unpaid loans or other obligations to or from stockholders, directors or officers or, except for
compensation paid by such Corporation to employees in the ordinary course of business, to or from
employees of such Corporation.

               vi. Except as set forth in Exhibit 6-B, none of the Corporations has made any payments,
dividends or other distributions to Stockholder or any other affiliate between January 31, 2009 and
the Closing Date.

11

 

          c. Financial Statements. Stockholder has furnished Buyer with balance sheets of each
Corporation (collectively, the “Balance Sheets”) dated December 31, 2008, January 31, 2009,
February 28, 2009, and March 31, 2009 (the March 31, 2009 date is sometimes herein referred to as
the “Last Balance Sheet Date”), and the related statements of income for each Corporation
(collectively, the “Income Statements”) for the periods ended December 31, 2008, January 31, 2009,
February 28, 2009, and March 31, 2009, copies of which are attached hereto as Exhibit 6-C (the
Balance Sheets and Income Statements are collectively referred to herein as the “Financial
Statements”). The Financial Statements: (i) are in accordance with the books and records of each
such Corporation; (ii) fairly represent the financial condition of each such Corporation at such
dates and the results of its operations for the periods specified; (iii) were prepared on a basis
consistent with prior accounting periods; (iv) with respect to all contracts and commitments of
each such Corporation, reflect adequate reserves for all reasonably anticipated losses and costs in
excess of anticipated income; and (v) with respect to the Balance Sheets, disclose all of the
debts, liabilities and obligations of any nature (whether absolute, accrued, contingent, or
otherwise) of each such Corporation at the Last Balance Sheet Date and include the appropriate
reserves for all taxes and other accrued liabilities, except that certain contingent liabilities,
if not disclosed on the Balance Sheets, shall be considered to be disclosed pursuant to this
subsection, if disclosed on an Exhibit to this Agreement. The Stockholder covenants and agrees to
deliver to Buyer, post-Closing, the balance sheet of each Corporation and the related statement of
income of each Corporation for the month ended April 30, 2009, and for the period commencing on May
1, 2009 and ending on May 15, 2009, promptly following completion of such financial statements by
Stockholder, but in no event later than May 31, 2009 for the April 30, 2009 financial statements
and in no event later than June 15, 2009 for the May 15, 2009 financial statements.

          d. Aggregate Existing Obligations. All of the debts, liabilities and obligations of
each of the Corporations are listed on the Schedule of Liabilities attached hereto as Exhibit 6-D
and such schedule accurately reflects all of such Corporations’ “Aggregate Existing Obligations”
(as hereinafter defined) as of the Effective Date. The term “Aggregate Existing Obligations” shall
mean and refer to all of such Corporations’ debts, liabilities and obligations of any nature
(whether absolute, accrued, contingent, or otherwise) on the Effective Date, including but not
limited to any and all accounts payable, trade payables, lease obligations, indebtedness for
borrowed money, accrued interest, contractual obligations, etc. By way of illustration and not
limitation, Stockholder represents and warrants that those obligations set forth in Section 3.c
hereof have been paid in full prior to the Closing Date. Except for those accounts payable listed
in Exhibit 6-R (which Stockholder, Arcadia Resources, Inc. and RKDA, Inc. are responsible for and
obligated to pay in full pursuant to Section 3.f hereof or under the applicable Guaranty
Agreement), Stockholder warrants and represents that the aggregate amount of the Aggregate Existing
Obligations is not in excess of Zero Dollars ($-0-) as of the Effective Date. The Stockholder
acknowledges that the purchase price for the Shares is based on the accuracy of Stockholder’
representations and warranties contained in this Agreement, including but not limited to the
Stockholder’ representations and warranties contained in this subsection 6.d.

          e. Undisclosed Liabilities. None of the Corporations has any debt, liability or
obligation of any kind (and, to the knowledge of Stockholder, there are no facts in existence as of
the Closing Date that could reasonably be expected to result in any present or future action,

12

 

suit, proceeding, hearing, investigation, charge, complaint, claim or demand against any of
the Corporations that would give rise to any debt, liability or obligation), whether accrued,
absolute, contingent or otherwise, including without limitation, any liability or obligation on
account of taxes or any governmental charge or penalty, interest or fine, except liabilities
incurred after May 15, 2009 in the ordinary course of business that did not, individually or in the
aggregate, have a material adverse effect on the Business, assets, results of operations, prospects
or condition (financial or otherwise) of any Corporation as of the Closing Date. By way of
illustration and not limitation, Stockholder and not Buyer nor any of the Corporations shall be
fully liable for any debt, liability or obligations (whether lease obligations or otherwise)
arising from or related in any way to the closing of business locations of the Corporations on or
before the Effective Date, including but not limited to those prior business locations (now closed)
of: (1) Beacon/Georgia located in Atlanta, Georgia; (2) Lovell located in Statesville, North
Carolina, and 496 North Main Street, Mount Airy, North Carolina; and (3) Trinity located at 3918
West Point Boulevard, Winston-Salem, North Carolina, 116 North Old Statesville Road, Suite B,
Huntersville, North Carolina, 1165 Allgood Road, Marietta, Georgia, 541 Historic Highway 441,
Demorest, Georgia, and 221A Pat Haralson Memorial Drive, Blairsville, Georgia.

          f. Title to the Shares. Stockholder owns good, absolute and marketable title to, and
all beneficial interest in, the Shares, which represent all of the issued and outstanding capital
stock of each of the Corporations. Such Shares are (i) validly issued, fully paid and
nonassessable, (ii) free and clear of any liens, claims and encumbrances, with no defects in title,
whatsoever, and (iii) free and clear of any restrictions on transfer (other than any restrictions
under the Securities Act of 1933, as amended (the “Securities Act”) and state securities laws),
taxes, liens, encumbrances, options, warrants, purchase rights, contracts, commitments, equities,
claims and demands. Stockholder is not a party to any option, warrant, purchase right, preemptive
right, or other contract or commitment that would require Stockholder to sell, transfer, or
otherwise dispose of any capital stock of any of the Corporations (other than pursuant to this
Agreement), except as disclosed on the Schedule of Stockholder Agreements attached hereto as
Exhibit 6-F. Stockholder is not a party to any voting trust, proxy, or other agreement or
understanding with respect to the voting of any capital stock of any of the Corporations, except as
disclosed on the Schedule of Stockholder Agreements attached hereto as Exhibit 6-F. All of the
option, warrant, purchase right, preemptive right, other contracts, other commitments, voting
trusts, proxies and any other agreement or understanding listed on Exhibit 6-F shall be terminated
on or before the Effective Date. Stockholder has the complete and unrestricted right, power and
authority to sell the Shares pursuant to this Agreement.

          g. Present Status. Except as disclosed on the Schedule of Stockholders, Distributions
and Exempted Transactions attached hereto as Exhibit 6-G, since January 31, 2009, none of the
Corporations has made any expenditures nor incurred any obligations or liabilities, except in the
ordinary course of business; discharged or satisfied any liens or encumbrances, except in the
ordinary course of business; declared or made any payment or distribution to Stockholder or
purchased or redeemed any of such Corporation’s common capital stock or agreed to do so; mortgaged,
pledged or subjected to lien or encumbrance any of such Corporation’s assets; sold or transferred
any assets, except in the ordinary course of business; suffered any damage or loss (whether or not
covered by insurance), materially affecting such

13

 

Corporation’s properties; waived any rights of substantial value; nor entered into any
transaction other than in the ordinary course of business.

          h. Tax Returns and Audits. Each Corporation or Stockholder has duly filed all
Federal, state and local tax returns required to be filed by, or with respect to, each such
Corporation, and have paid the taxes for all periods covered by such returns, except for certain
sales tax filings involving sales taxes due of less than $5,000 in the aggregate, which sales taxes
Stockholder agrees to pay after the Closing Date for such periods as relate to the operation of the
Businesses of the Corporations through May 15, 2009. None of the Corporations has been delinquent
in the payment of any tax, assessment or governmental charge. None of the Corporations has had,
and, to the knowledge of Stockholder, there are no facts in existence as of the Closing Date that
could reasonably be expected to result in, any tax deficiencies proposed or assessed against any
such Corporation, nor has any Corporation executed any waiver of the statute of limitations on the
assessment or collection of any tax. No Federal or State tax returns of any of the Corporations
have ever been audited by the Internal Revenue Service or the Department of Revenue of the state of
each such Corporation’s organization. Copies of the Federal Income tax return of each Corporation
for the periods ending March 31, 2007 and March 31, 2008 are attached hereto as Exhibit 6-H. None
of the Corporations is a party to any tax sharing agreements with Stockholder or any other
affiliates. Notwithstanding anything contained in this Agreement to the contrary, the Stockholder
shall be liable for and shall pay promptly when due, any taxes of any kind which relate to the
operation of the Business prior to the Effective Date. The Stockholder covenants and agrees to
deliver to Buyer, post-Closing, the Federal Income tax return of each Corporation for the period
ending March 31, 2009, promptly following completion of such tax return by Stockholder but in no
event later than December 31, 2009.

          i. Litigation. Except as disclosed on the Schedule of Litigation and Other Legal
Proceedings attached hereto as Exhibit 6-I, there are no legal actions, suits, arbitrations, or
other legal, administrative, or other governmental proceedings pending or, to the knowledge of
Stockholder, threatened against any of the Corporations, which, if adversely determined, could
reasonably be expected to, individually or in the aggregate, materially impair the right of any
Corporation to carry on the Business substantially as now being conducted or would result in a
material adverse effect on the business, assets, results of operations, prospects or conditions
(financial or otherwise) of any such Corporation, and Stockholder is not aware of any facts or
circumstances which to the knowledge of Stockholder may (with or without notice or lapse of time)
reasonably give rise to, serve as a basis for or result in any such action, suit, claim,
arbitration, or other proceedings against or involving any of the Corporations. Notwithstanding
anything in this Agreement to the contrary, Stockholder assumes all liabilities of any kind arising
from or which is in any way related to any and all legal matters, disputes, claims or proceedings
involving Dargon Smith, Sue Smith and/or their representatives, successors or assigns, as
plaintiff(s) and/or holders of judgments, and Beacon/Georgia, Lowcounty Home Medical Equipment,
Inc., Medical Equipment Company and/or their successors or assigns, as defendant(s) and/or parties
obligated to pay any judgments, including but not limited to: (1) any matters described on Exhibit
6-I or described on Stockholder’s CD-ROM disk response to Buyer’s due diligence inquiries regarding
pending litigation, and (2) any lawsuits, legal proceedings, mediations, arbitrations, events,
actions or omissions relating thereto (collectively,

14

 

the “Pending Litigation”). By way of illustration and not limitation, the Stockholder, and
not Buyer or Beacon/Georgia, shall be responsible for and be obligated to pay any and all damages,
judgments, settlements, legal fees and costs, court costs, costs of appeal and all other claims,
damages, expenses and costs of any kind related to the Pending Litigation or any lawsuit or legal
proceeding or appeals arising therefrom (the “Pending Litigation Obligations”). In the event
Stockholder fails to pay for any of the Pending Litigation Obligations upon demand or when due, and
demand is made by any entity or person against Buyer or Beacon/Georgia for such Pending Litigation
Obligation, Buyer shall have the right to make immediate offset against the Contingent Cash
Consideration without Stockholder having any right to dispute any such offset. Notwithstanding
anything set forth in this Agreement to the contrary, Stockholder’s obligation to pay any and all
Pending Litigation Obligations shall survive the Closing for an indefinite period. Stockholder has
represented to Buyer that the Pending Litigation has been settled for the amount of $25,000, and
that such amount was paid prior to the Closing Date.

          j. Compliance With Articles, Bylaws and Other Instruments and Laws; Noncontravention.
None of the Corporations is in violation of such Corporation’s Articles of Incorporation, as
amended, such Corporation’s Bylaws, as amended, or of any indebtedness, mortgage, contract, lease
or other agreement or commitment. Performance of this Agreement will not violate the Articles of
Incorporation, as amended, or the Bylaws, as amended, of any of the Corporations. The business and
operation of each Corporation have been and are being conducted in accordance with all applicable
laws, rules and regulations of all authorities, except those which do not (either individually or
in the aggregate) materially and adversely affect each such Corporation or its properties, assets,
businesses or prospects. Neither the execution and the delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, will (i) to the knowledge of Stockholder,
violate any constitution, statute, regulation or rule, (ii) violate any injunction, judgment,
order, decree, ruling, charge, or other restriction of any government, governmental agency, or
court to which any of the Corporations are subject, or (iii) conflict with, result in a breach of,
constitute a default under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify, or cancel, or require any notice under any agreement, contract,
lease, license, instrument, or other arrangement to which any of the Corporations are a party or by
which any of the Corporation’s are bound or to which any of such Corporation’s assets are subject
(or result in the imposition of any lien or encumbrance upon any Corporation’s assets). None of
the Corporations need to give any notice to, make any filing with, or obtain any authorization,
consent, or approval of any government or governmental agency in order for the Parties to
consummate the transactions contemplated by this Agreement, other than notices to Medicare and
Medicaid.

          k. Title to Property and Assets. Each Corporation has good, absolute and record title
to, or a valid leasehold interest in, all property and assets of such Corporation used by such
Corporation, located on its premises, shown on the Last Balance Sheet or acquired through the
Closing Date, free and clear of all liens, charges, claims and encumbrances of any kind. Set forth
on the Schedule of Included Assets attached hereto as Exhibit 6-K1 is a true and complete list of
all assets of each of the Corporations used by each Corporation, located on its premises, shown on
the Last Balance Sheet and acquired through the Closing Date. The assets of each Corporation also
include the corporate name of the business, its current telephone numbers and telefax numbers, its
patients list (as more specifically described on Exhibit 6-T hereof), its

15

 

provider numbers (as more specifically described on Exhibit 6-U hereof), any websites used by
each such Corporation, and the following fictitious or assumed names: “Arcadia H.O.M.E”, which
Stockholder represents is a fictitious name of Beacon/Georgia having an active status for such use
in the State of South Carolina and a fictitious name of Trinity having an active status for such
use in the States of Georgia and North Carolina; and “HomeLife Medical”, which Stockholder
represents is a fictitious name of Trinity having an active status for such use in the State of
Georgia. Stockholder has not received notice from any party that use of any Corporation’s
corporate name, any of the above fictitious or assumed names, or any logo used by any Corporation
is infringing on another’s trade name, trademark, or service mark, nor has any person or entity
taken or threatened to take any legal action against any Corporation or Stockholder as a result of
the use by such Corporation of its corporate name, such fictitious or assumed names or any logo.
If requested by Buyer, the Stockholder agrees to: (I) use reasonable efforts to assure that Buyer
can utilize such corporate and fictitious or assumed names within the State of Florida; and (II)
reasonably assist in each Corporation’s defense of any name infringement claim by providing facts
known to such Stockholder or otherwise reasonably cooperate with such defense. The assets of each
Corporation on the Effective Date shall not include any personal items set forth on the Schedule of
Excluded Assets attached hereto as Exhibit 6-K2 hereof. After May 18, 2010, the Buyer shall
assign, or cause the applicable subsidiaries of Buyer to assign, any rights it or they may have to
the use of the fictitious or assumed name “Arcadia H.O.M.E.” in any states where Buyer or such
subsidiaries are authorized to use such name, provided: (1) Stockholder requests in writing that
Buyer make such assignments; and (2) Stockholder submits for execution by Buyer or Buyer’s
applicable subsidiaries, documents in form and substance reasonably acceptable to Buyer, intended
to accomplish such assignments and setting forth the specific business entities to whom such
assignments are to be made.

          l. Asset Condition and Quality. All of the properties and assets of each Corporation
are free of damage and defects and are not obsolete except as disclosed on the Schedule of Included
Assets attached hereto as Exhibit 6-K1. All of the properties and assets of each Corporation on
the Closing Date shall be in good operating condition and repair, reasonable wear and tear excepted
and except those assets which are being repaired in the ordinary course of business, and shall
conform in all material respects with all applicable ordinances, regulations, zoning and other
laws.

          m. Contracts. The Schedule of Contracts attached hereto as Exhibit 6-M sets forth a
true and complete list of all contracts, agreements and commitments (whether written or oral) to
which each Corporation is, directly or indirectly, a party (in its own name or as a successor in
interest), or by which each Corporation or any of its properties or assets is otherwise bound,
including but not limited to any service agreements, patient agreements, supplier agreements,
agreements to lend or borrow money, stockholder agreements, employment agreements, confidentiality
agreements, non-disclosure agreements, non-competition agreements and non-solicitation agreements
(collectively, the “Contracts”). None of the Corporations nor, to the knowledge of Stockholder,
any other party to any of the Contracts (i) is in default under (nor does there exist any condition
that, with notice or lapse of time or both, would cause such a default under) any of the Contracts,
or (ii) has waived any right it may have under any of the Contracts, the waiver of which would have
a material adverse effect on the business, assets, results of operations,

16

 

prospects or condition (financial or otherwise) of each such Corporation. All of the
Contracts (i) constitute the legal, valid, binding and enforceable obligations of each such
Corporation, and, to the knowledge of Stockholder, of the other parties thereto, enforceable
against each such Corporation and, to the knowledge of Stockholder, such other parties in
accordance with their respective terms, (ii) do not require any third party consents in
anticipation of the execution this Agreement and the consummation of the transactions contemplated
hereby, and (iii) will not be terminated or otherwise modified, solely as a result of the
consummation of the transactions contemplated hereby.

          n. Leases and Insurance Policies.

               i. The Schedule of Leases and Insurance Policies, attached hereto as Exhibit 6-N, sets forth
all leases and insurance policies executed by or issued for the benefit of each of the
Corporations. Each Corporation has delivered to the Buyer:

                    A. The original of the leases, with amendments (collectively, the “Leases”), covering all of
the leased premises that each such Corporation presently occupies (the “Leased Premises”);

                    B. The originals of all other leases, with amendments, to which each such Corporation is a
party; and

                    C. The originals of all fire and other casualty and liability policies (including product
liability) of each such Corporation in effect at the date of this Agreement (the “Insurance
Policies”).

     All Insurance Policies are in full force and effect as of the Effective Date and are in
amounts and against such losses and risks as are described in such Insurance Policies.

               ii. Stockholder represents and warrants that Stockholder and each of the Corporations are not
in default in the performance of any of their respective obligations under any of the Leases, that
none of the Leases is encumbered by any prior transfer, assignment, or any other encumbrance by
Stockholder or any of the Corporations, and that the purchase of the Shares by Buyer from
Stockholder does not require that any of the Corporations, Stockholder or Buyer execute any
assignments or obtain any written consents of the applicable lessors or landlords of any such
Leases, except for the following assignments, consents and acknowledgements which Stockholder
represents are the only assignments, consents and acknowledgements required to be executed as part
of the transactions contemplated by this Agreement (collectively, the “Required Assignments and
Landlord Consents”): (A) Assignment of Lease, with Landlord Acknowledge and Consent, pertaining to
leased property having a street address of 46 Boone Trail, North Wilkesboro, North Carolina; (B)
Assignment of Lease, with Landlord Acknowledge and Consent, pertaining to leased property having a
street address of 200 Technology Court, Suite 300 (or Suite H), Smyrna, Georgia; (C) Assignment of
Lease, with Landlord Acknowledge and Consent, pertaining to leased property having a street address
of 176 West Independence Blvd., Mount Airy, North Carolina; (D) Assignment of Lease, with Landlord
Acknowledge and Consent, pertaining to leased property having a street address of 186 West
Independence Blvd., Mount Airy, North Carolina; (E) Acknowledgement of Lease Status (by Landlord),
pertaining to leased property having a street

17

 

address of 46 Boone Trail, North Wilkesboro, North Carolina; (F) Acknowledgement (by
Landlord), pertaining to leased property having a street address of 1651 Thompson Bridge Road,
Suite A, Gainesville, Georgia; and (G) Consent (of Landlord), pertaining to leased property having
a street address of 416A Robertson Blvd., Walterboro, South Carolina.

          o. Intellectual Property. Each of the Corporations owns, possesses and has good title
to all trademarks, service marks, service names, patents and licenses necessary in the conduct of
the Business of each such Corporation.

          p. Records. The books of account, minute books, stock certificate books and stock
records of each of the Corporations are complete and correct in all material respects, and reflect
all transactions involving the Business which properly should have been set forth in such books.
Each Corporation has delivered to Buyer correct and complete copies of its Articles of
Incorporation and By-laws, both as amended to date, and will deliver to Buyer on the next business
day after the Closing, the books of account, the minutes books, the stock certificate books, the
stock records and such other books and records as are necessary for the Buyer to operate the
business of each such Corporation.

          q. Accounts Receivable. Each of the Corporations has followed in all respects and
aspects at all times through the Effective Date, and Stockholder commits to follow in all respects
and aspects at all times on and after the Effective Date, all Medicare guidelines and procedures
relating to each such Corporation’s accounts receivable.

          r. Accounts Payable. The information contained on the Schedule of Accounts Payable
Data as of April 30, 2009 (attached hereto as Exhibit 6-R) and as of May 15, 2009 (to be delivered
post-closing as an updated Exhibit 6-R) is accurate and complete. Notwithstanding anything
contained in this Agreement or in any Exhibit or Schedule which is a part hereof, Stockholder and
Arcadia Resources, Inc. shall be jointly and severally liable for, and shall promptly pay in full
when due, all of each Corporation’s accounts payable applicable to the operation of the Business of
each such Corporation prior to the Effective Date, including but not limited to the accounts
payable listed on Exhibit 6-R.

          s. Personnel; Payrates; Employment and Non-Compete Agreements; and Employee Benefits.

               i. The information contained on the Schedule of Personnel, Payrates and Employment and
Non-Compete Agreements, attached hereto as Exhibit 6-S1, is accurate and complete, and sets forth a
list of all employees of each of the Corporations, the current salary level of each, whether each
such listed employee has in place any employment agreement and whether each such listed employee
has in place any confidentiality, non-disclosure, non-compete and/or non-solicitation agreements.
There is not pending or, to the knowledge of Stockholder, threatened, nor are there any facts in
existence as of the Closing Date that could reasonably be expected to result in, any legal actions,
suits, arbitrations or other legal, administrative or other governmental proceedings by any
employee against any of the Corporations, which, if adversely determined, could reasonably be
expected to, individually or in the aggregate, materially impair the right of any of any
Corporation to carry on the Business of such Corporation substantially as

18

 

now being conducted or would result in a material adverse effect on the business, assets,
results of operations, prospects or conditions (financial or otherwise) of such Corporation.

               ii. The information contained on the Schedule of Retirement and Other Benefits, attached
hereto as Exhibit 6-S2, is accurate and complete, and sets forth a description of any plans
providing pensions, profit-sharing, insurance benefits, cafeteria plans, SIMPLE plans or any other
similar type of fringe benefits to which any of the Corporations is a party or committed either
orally, in writing or by law, or to which provide any benefit to any of the Corporations or any
Corporation’s employees, including all employee benefit plans (“Employee Benefit Plans”), as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”), established by any of the Corporations or to which any of the Corporations contributes
or is or has been required to contribute. None of the Corporations has ever maintained any plan or
arrangement for providing medical or non-pension benefits to terminated or retired employees or
their dependents. The Employee Benefit Plans and the related trusts comply and have complied in
all material respects with the provisions of ERISA and all other applicable laws, rules and
regulations, and all necessary governmental approvals for the Employee Benefit Plans have been
obtained, including, without limitation, qualification of the Employee Benefit Plans under the
Internal Revenue Code of 1986, as amended. The Employee Benefit Plans have been administered to
date in compliance with the requirements of ERISA in all material respects. True and complete
copies of all reports or other documents filed with the Internal Revenue Service or the Department
of Labor with respect to the Employee Benefit Plans have been delivered by each of the Corporations
to Buyer. Since December 31, 1974, no fiduciary of the Employee Benefit Plans has engaged in any
“prohibited transaction” (as defined in ERISA), no “reportable event” (as defined in Section
4043(b) of ERISA) has occurred with respect to the Employee Benefit Plans and there is no unfunded
vested liability with respect to the Employee Benefits Plans, which, in each such case, would
result in material liability to any of the Corporations. None of the Corporations (nor any entity
within the same group of trades or businesses under common control, within the meaning of ERISA
Section 4001(b)(1), as any of the Corporations) has had a material liability under Title IV of
ERISA, which has not been paid in full.

          t. Patient’s List. The Patients’ List of the Business attached hereto as Exhibit 6-T
accurately and completely lists all of the patients of each of the Corporations. Each Corporation
shall deliver on the Closing Date: (i) all patient documents, correspondence and charts; (ii) all
information necessary to properly invoice all services to, to collect any amounts owed from and to
provide services to, such patients; and (iii) all certificates of medical necessity pertaining to
such patients. All patients of each Corporation who have received pharmacy products or services
from each such Corporation or from any entity related in any way to Arcadia Resources, Inc.,
including but not limited to SSAC, LLC d/b/a Arcadia RX, a Florida limited liability company
(“Arcadia RX”) with pharmacy business operations in the State of Kentucky, are included and listed
on the Patients’ List of the Business, and the Stockholder and each such entity providing pharmacy
products and services has delivered to Buyer not later than the Closing Date, all information
necessary to properly invoice all pharmacy products and services to, to collect any amounts owed
from and to provide pharmacy products and services to, such patients, including but not limited to
original prescriptions (to the extent permitted by applicable law), valid transfers of the
remaining refills of all active prescriptions for such patients, and

19

 

copies of the original physician orders and statements of medical necessity pertaining to such
patients; however, Stockholder recommends that Buyer obtain new valid physician orders for those
prescriptions filled prior to the Closing Date, and in the event Buyer takes action to obtain such
new valid physician orders, the Stockholder and Arcadia RX (in its Non-Competition and
Non-Solicitation Agreement) agree to reasonably assist Buyer in the effort. Stockholder agrees not
to process any prescriptions for any such patients on and after the Closing Date.

          u. Provider Numbers. The List of Provider Numbers attached hereto as Exhibit 6-U
accurately and completely lists all of the provider numbers used by each of the Corporations.

          v. Real Estate. All of the premises being leased by each of the Corporations pursuant
to the Leases (collectively, the “Leased Premises”), and the use thereof for each such
Corporation’s Business, comply in all material respects with all applicable Federal, state and
local laws, ordinances and regulations, including, without limitation, building and zoning laws (to
the extent compliance with such building and zoning laws is the responsibility of each such
Corporation and not the responsibility of the landlord or owner of any of the Leased Premises) and
OSHA regulations, and neither such Corporation nor Stockholder has received any notice from any
governmental authority or any insurance rating bureau that the Leased Premises or the use thereof
for such Corporation’s business do not so conform. All rent and other charges owed by each of the
Corporations with respect to the Leased Premises for all periods prior to the Closing Date have
been paid in full.

          w. Environmental Matters. To the knowledge of Stockholder, the real property on which
each of the Leased Premises are located (including surface water, groundwater, and any existing
improvements) do not contain any asbestos, material amounts of waste or debris, or contamination in
excess of permissible levels under applicable law, including, without limitation: (i) any
‘hazardous waste” as defined by the Resource Conservation and Recovery Act of 1976, as amended from
time to time, and regulations promulgated thereunder; (ii) any “hazardous substance” as defined by
the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended from
time to time, and regulations promulgated thereunder; and (iii) any substance the presence of which
is prohibited or regulated by any Federal, state or local law, ruling, rule or regulation similar
or dissimilar to those set forth in this Section 6.w, other than such products as are used in each
such Corporation’s Business in the ordinary course thereof.

          x. Brokers. Stockholder and Buyer agree that all negotiations relative to this
Agreement and the transactions contemplated hereby have been carried on directly between Buyer and
Stockholder without the intervention or assistance of any party (other than to provide advisory,
accounting or legal counsel). No party to this Agreement, nor any third party, has any right or
claim to any commission, brokerage fee or other compensation relative to this Agreement or the
transactions contemplated hereby.

          y. Absence of Certain Changes or Events. Since January 31, 2009, there has not been
any change in or any event or condition (financial or otherwise) affecting the properties, assets,
liabilities, operations or prospects of any of the Corporations other than changes in the ordinary
course of its business, none of which has (either when taken by itself or when taken in conjunction
with all other such changes) been materially adverse.

20

 

          z. Adverse Business Developments. None of the Corporations nor any Stockholder has
received, either orally or in writing, any notice of pending or threatened adverse action with
respect to any Medicare, Medicaid, private insurance or third party payer reimbursement method,
practice or allowance as to any business activity engaged by any such Corporation, nor has any such
Corporation or any Stockholder received nor been threatened with any claim for refund in excess of
$500 by a Medicare or Medicaid carrier, except as disclosed in the Schedule of Adverse Business
Developments attached hereto as Exhibit 6-Z.

          aa. Disclosure. No representation or warranty by Stockholder or any of the
Corporations in this Agreement or in any Exhibit hereto contains or will contain as to the
applicable representation and warranty any untrue statement of a material fact, or omits or will
omit to state any material fact required to make the statements herein or therein contained, in
light of the circumstances in which it was made, not misleading.

     7. Representations and Warranties by the Buyer. The Buyer represents and warrants to
the Stockholder that each of the following representations and warranties is true and correct as of
the Effective Date and again as of the Closing Date:

          a. Organization of the Buyer. Buyer is a duly organized, validly existing corporation
in good standing under the laws of the State of Delaware and has full power and authority to
consummate the transactions contemplated by this Agreement. Buyer has all requisite corporate
right, power and authority to enter into this Agreement and consummate the transactions
contemplated hereby.

          b. Authorization; Consents; Valid and Binding Obligation. The execution and delivery
of this Agreement and the consummation of the transactions contemplated hereby by the Buyer have
been duly and validly authorized and approved by all necessary corporate action on behalf of the
Buyer. No approvals, authorizations or consents are necessary to permit the Buyer to enter into
this Agreement and consummate the transactions contemplated hereby. This Agreement constitutes the
valid and legally binding obligation of the Buyer enforceable against the Buyer in accordance with
its terms, except to the extent that enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally
or by general principles of equity.

          c. Noncontravention. Neither the execution and the delivery of this Agreement, nor
the consummation of the transactions contemplated hereby, will (A) to the knowledge of the Buyer
violate any constitution, statute, regulation or rule, (B) violate any injunction, judgment, order,
decree, ruling, charge, or other restriction of any government, governmental agency, or court to
which the Buyer is subject or, any provision of the Buyer’s charter or bylaws, or (C) conflict
with, result in a breach of, constitute a default under, result in the acceleration of, create in
any party the right to accelerate, terminate, modify, or cancel, or require any notice under any
agreement, contract, lease, license, instrument, or other arrangement to which the Buyer is a party
or by which it is bound or to which any of its assets is subject.

21

 

          d. Brokers. All negotiations relative to this Agreement and the transactions
contemplated hereby have been carried on directly between the Buyer and Stockholder without the
intervention or assistance of any party (other than to provide advisory, accounting or legal
counsel). No Party to this Agreement, nor any third party, has any right or claim to any
commission, brokerage fee, or unless specified herein, any other compensation relative to this
Agreement or the transactions contemplated hereby.

          e. Disclosure. No representation or warranty by the Buyer in this Agreement contains
or will contain as to the applicable representation and warranty any untrue statement of a material
fact or omits or will omit to state any material fact required to make the statements herein
contained, in light of the circumstances in which it was made, not misleading.

          f. Characteristics of the Shares.

               i. Investment. The Shares that Buyer is acquiring hereunder are being acquired for
Buyer’s own account, not as a nominee or agent, and not with a view to the sale or distribution of
any part thereof for the purposes of the Securities Act.

               ii. Securities Not Registered. The Buyer understands that the Shares have not been
registered under the Securities Act on the ground that the issuance of such securities hereunder is
exempt from registration under the Securities Act and that Stockholder’s reliance on such exemption
is predicated on Buyer’s representations set forth in this Section 7.f.

               iii. Restricted Nature of Stock. Buyer acknowledges that the Shares must be held
indefinitely unless subsequently registered under the Securities Act or an exemption from such
registration is available.

     8. Certain Stockholder Covenants Through the Closing Date; Certifications of Stockholder
at Closing.

          a. Certain Stockholder Covenants Through the Closing Date. From January 31, 2009
until the Closing Date, the Stockholder: (i) used its best efforts to conduct the Business of each
Corporation in a reasonable and prudent manner in accordance with past practices; (ii) did not
cause or permit any of the Corporations to engage in any transactions out of the ordinary course of
business; (iii) used its best efforts to preserve the existing business organization of each
Corporation and each such Corporation’s relations with its employees, patients, franchisers,
suppliers and others with whom it has a business relationship; (iv) used its best efforts to
preserve and protect the assets of each Corporation; (v) did not cause or permit any of the
Corporations to sell, encumber or dispose of any of its assets, except such as are retired or
replaced in the ordinary course of business; (vi) caused each of the Corporations to conduct its
business in compliance with all applicable laws and regulations; (vii) did not cause or permit any
of the Corporations to make any distributions (excluding inter-company cash transactions in the
ordinary course of business) to Stockholder, or make either interest or principal payments on
stockholder or related party notes or loans, or make any other withdrawals other than in the
ordinary course of business, unless disclosed to and approved by the Buyer; (viii) did not cause or
permit any of the Corporations to pay any bonuses or make any salary or wage increases to

22

 

employees of any Corporation, unless disclosed to and approved by the Buyer; and (ix) took no
actions, nor caused or permitted any of the Corporations to take any actions, which might be
materially adverse to the interests of the Stockholder, the Buyer, or the Business of any of the
Corporations.

          b. Certifications of Stockholder At Closing. Stockholder hereby certifies that,
during the period from January 31, 2009 through the Closing Date:

	 	i.	 	There has been no material deterioration or other material
adverse affect to the Shares being acquired nor the net worth of the Business
of any of the Corporations, and that there has been no material adverse change
in the financial affairs of any of the Corporations which has not been
disclosed in writing to the Buyer prior to the Closing Date and that none is
anticipated subsequent to the Closing Date.
	 
	 	ii.	 	Each Corporation has all permits, licenses, consents,
certificates and approvals required by all Federal, state and local
governmental agencies to operate its respective businesses and to use its
respective assets for the intended purposes of such assets, except that certain
of such Corporation’s applications for provider numbers are pending as
disclosed on an exhibit to this Agreement.
	 
	 	iii.	 	Except as disclosed in the exhibits hereto, there are no
management, service, supply, maintenance or other contracts or agreements which
are applicable to or affect the assets of any of the Corporations or the
operation of the Business of any of the Corporations.

     9. Conditions Precedent to Closing by Stockholder. The obligation of the Stockholder
to sell the Shares to Buyer is subject to and conditioned upon the satisfaction, at or prior to the
Closing Date, of each of the following conditions:

          a. Compliance with Agreement. All of the terms and conditions of this Agreement to be
complied with and performed by the Buyer on or before the Closing Date, shall have been complied
with and performed; and

          b. Representations and Warranties. The representations and warranties of the Buyer in
Section 7 shall be deemed to have been made again on the Closing Date and then be true and correct,
subject to any changes contemplated by this Agreement; and

          c. Payment of Cash Consideration At Closing. The Buyer has made the payment of Cash
Consideration required to be made as of the Closing Date under Section 3.a hereof; and

          d. Consents. Stockholder shall have received the approval of the Stockholder’s Board
of Directors; and

23

 

          e. Legal Opinion. The Stockholder shall have received from counsel to Buyer, an
opinion in form and substance as set forth in
Exhibit 9-E attached hereto, addressed to the
Stockholder, and dated as of the Closing Date; provided, however, in the event the legal opinion
required by Section 10.c is not delivered at Closing, legal counsel to Buyer may deliver such legal
opinion to Stockholder post-Closing promptly after the legal opinion required by Section 10.c is
delivered to Buyer; and

          f. Other Actions and Instruments. All other actions to be taken by the Buyer in
connection with consummation of the transactions contemplated hereby shall have been undertaken,
and all certificates, instruments, and other documents required to effect the transactions
contemplated hereby, in form and substance satisfactory to Stockholder, shall have been received.

     10. Conditions Precedent to Closing by the Buyer. The obligation of the Buyer to
consummate the transactions contemplated by this Agreement on the Closing Date is subject to and
conditioned upon the satisfaction, at or prior to the Closing Date, of each of the following
conditions:

          a. Compliance with Agreement. All of the terms and conditions of this Agreement to be
complied with and performed by the Stockholder and each Corporation on or before the Closing Date,
shall have been complied with and performed; and

          b. Representations and Warranties. The representations and warranties of the
Stockholder in Section 6 shall be deemed to have been made again on the Closing Date and then be
true and correct, subject to any changes contemplated by this Agreement. There shall have been no
materially adverse change in the financial condition of any of the Corporations; and

          c. Legal Opinion. The Buyer shall have received from counsel to Stockholder and the
Corporations, an opinion in form and substance as set forth in Exhibit 10-C attached hereto,
addressed to the Buyer, and dated as of the Closing Date; and

          d. Non-Competition and Non-Solicitation Agreements. Stockholder, Arcadia Resources,
Inc., a Nevada corporation, RKDA, Inc., a Michigan corporation, and SSAC, LLC d/b/a Arcadia RX, a
Florida limited liability company with pharmacy business operations in the State of Kentucky, shall
each have entered into a non-competition and non-solicitation agreement substantially in the
applicable form attached hereto as Exhibit 10-D, and Stockholder shall have caused to be delivered
to Buyer at Closing, executed originals of each such agreement; and

          e. Employment Agreement. Darian Byrd shall have entered into an Employment Agreement
substantially in the form attached hereto as Exhibit 10-E, and Stockholder shall have caused to be
delivered to Buyer at Closing, an executed original of such agreement; and

          f. Guaranty Agreement. Arcadia Resources, Inc. and RKDA, Inc. shall each have
executed a guaranty agreement substantially in the applicable forms attached hereto as

24

 

Exhibit 10-F, and Stockholder shall have caused to be delivered to Buyer at Closing, executed
originals of each such guaranty agreement; and

          g. Resignations. Each of the officers and directors of the Corporation shall have
executed resignations substantially in the forms attached hereto as Exhibit 10-G; and

          h. Required Assignments and Landlord Consents. The Buyer shall have received the
Required Assignments and Landlord Consents, in form and substance satisfactory to Buyer, executed
by Stockholder and/or the applicable lessors or landlords; and

          i. Consents. The Buyer has received approval of Buyer’s Board of Directors; and

          j. Release of Liens. Jana Master Fund, Ltd., Vicis Capital Master Fund, and LSP
Partners (collectively, the “Creditors”) shall have taken all steps to terminate and shall have
terminated, on or before the Closing Date, all claims, liens and encumbrances of any kind held by
the Creditors on the assets of any of the Corporations, and Stockholder shall have delivered to
Buyer, copies of the executed originals of release letters signed by each of the Creditors, which
release letters shall be substantially in the forms attached hereto as Exhibit 10-J; and

          k. Other Actions and Instruments. All other actions to be taken by Stockholder and
any of the Corporations in connection with consummation of the transactions contemplated hereby
have been undertaken, and all certificates, opinions, instruments, and other documents required to
effect the transactions contemplated hereby, in form and substance satisfactory to the Buyer, have
been received.

     11. Survival.

          a. Representations and Warranties. The representations and warranties of Stockholder
and the Buyer contained and made pursuant to this Agreement shall survive the Closing of this
Agreement for a period of three (3) years from the Closing Date, except that the representations by
Stockholder as to the capitalization and long term indebtedness of each of the Corporations set
forth in Section 6.b hereof, the representation by Stockholder as to its title to the Shares set
forth in Section 6.f hereof, and the representations, warranties and covenants of the Stockholder
regarding accounts receivable of each of the Corporations set forth in Section 6.q hereof, shall
survive the execution and consummation of this Agreement for an indefinite period, and except that
the representation by Stockholder as to taxes, as set forth in Section 6.h, shall survive the
execution and consummation of this Agreement until any statute of limitations applicable to such
representation or warranty lapses.

          b. Post-Closing Covenants. The post-closing covenants of Stockholder, the
Corporations and the Buyer contained and made pursuant to Section 12 of this Agreement shall
survive the execution of this Agreement and continue in full force and effect.

25

 

     12. Post Closing Obligations.

          a. Section 338(h)(10) Election.

               i. Stockholder shall join with Buyer in making an election under Section 338(h)(10) of the
Internal Revenue Code of 1986, as amended (the “Code”) (and any corresponding election under state,
local or foreign tax law) with respect to the purchase of the Shares by Buyer (the
“Section 338(h)(10) Election”). Any Tax imposed on any of the Corporations or Stockholder as a
result of the Section 338(h)(10) Election shall be the responsibility of and be paid by
Stockholder. Stockholder further will be responsible for preparing and filing, and paying any tax
liability relating to, all income or franchise tax returns relating to periods ending on or before
the Effective Date.

               ii. Buyer, the Corporations and Stockholder agree that the Purchase Price and the liabilities
of each Corporation (plus other relevant items) will be allocated to the assets of each such
Corporation for all purposes (including tax and financial accounting) in accordance with the agreed
upon allocation to be set forth in Exhibit 3-H hereof, which allocation shall be binding upon
Stockholder. Buyer, the Corporations and Stockholder will file all tax returns (including amended
returns and claims for refund), information reports and other forms in a manner consistent with
such allocation.

          b. Payment of Taxes; Preparation and Filing of Tax Returns. In the event that a
deficiency is finally determined in the amount of Federal or state or local tax payable by any
Corporation, which deficiency relates to periods ending on or before the Effective Date, then, in
that event, Stockholder agrees to be responsible for the payment of, and shall pay, promptly upon
final determination that such payment is due, such deficiency and any interest and penalties
thereon. In the event that a tax refund is received, which tax refund relates to periods ending on
or before the Closing Date, then, in that event, Stockholder shall be entitled to such tax refund
and the Buyer agrees to have the applicable Corporation endorse and deliver such tax refund to
Stockholder promptly upon receipt thereof. Stockholder agrees that the Buyer shall not be liable
for any income taxes (and associated interest and penalties), net of tax benefits received, of any
of the Corporations payable or incurred by any such Corporation through the Effective Date.
Stockholder shall be responsible for preparing, filing and paying taxes due on the Form 1120 to be
filed for the tax year period ended March 31, 2009, and for the short period between April 1, 2009
and the Effective Date, and each Corporation shall be responsible for preparing, filing and paying
taxes due on the Form 1120 to be filed for the short period from the Effective Date through March
31, 2010. The Buyer and Stockholder will cooperate fully, and to the extent reasonably requested
by the other party, in connection with the filing of tax returns, and any audit, litigation, or
other proceeding with respect to the corporate taxes. Buyer will not, without Stockholder’s prior
written consent, amend any tax returns of any of the Corporations for any periods prior to the
Effective Date, including the Form 1120 to be filed for the tax year ended March 31, 2009, and for
the short period between April 1, 2009 and the Effective Date (“Prior Period Tax Returns”). If
Buyer files any amendments to Prior Period Tax Returns without the prior written consent of the
Stockholder, then Buyer shall be responsible for any and all costs and expenses relating thereto,
including costs of defending any audit, litigation, or other proceedings with respect to the taxes,
and the costs of paying any additional taxes or assessments

26

 

(including penalties and interest) relating to such amended tax returns, and hereby agrees to
indemnify Stockholder from and against all liability, and attorney’s fees with respect to such
amended returns in accordance with the provisions of Section 13 of this Agreement.

          c. No Further Claims. Except for those amounts mutually agreed to by the parties
during the weekly reconciliation process set forth in Section 3.h hereof, Stockholder acknowledges
that there remain no amounts due and owing by any of the Corporations to Stockholder, whether or
not accrued as of the Closing Date, and releases any claims it may have against each Corporation
for any further payments or obligations (except as to those amounts mutually agreed to by the
parties during the weekly reconciliation process set forth in Section 3.h hereof).

     13. Indemnification; Remedies.

          a. Indemnification by Stockholder. Stockholder shall and hereby agrees to indemnify,
defend and hold harmless at all times, the Buyer, each of the Corporations and each of their
respective successors and assigns, as to and against any Damages (as hereinafter defined) resulting
from: (i) any inaccurate representation made by Stockholder in or under this Agreement; (ii) breach
of any representations or warranties made by Stockholder in or under this Agreement; (iii) breach
or default in the performance by Stockholder or any of the Corporations of any of the covenants to
be performed by Stockholder or any such Corporation hereunder; and (iv) any Pre-Closing
Liabilities.

          b. Indemnification by the Buyer. The Buyer shall and hereby agrees to indemnify,
defend and hold harmless at all times Stockholder and its successors and assigns, as to and against
any Damages resulting from: (i) any inaccurate representation made by the Buyer in or under this
Agreement; (ii) breach of any representations or warranties made by Buyer in or under this
Agreement; (iii) breach or default in the performance by the Buyer of any of the covenants to be
performed by the Buyer hereunder; and (iv) any claim, debt, liability or obligation of each of the
Corporations of any kind arising on or after the Closing Date which pertains to any actions,
omissions, debts, liabilities, obligations, facts and events, of any such Corporation, created or
arising after the Closing Date.

          c. Definitions.

               i. Damages. The term “Damages” as used herein, shall include any demands, claims,
actions, deficiencies, losses, delinquencies, defaults, assessments, fees, costs, taxes, expenses,
debts, liabilities, obligations, penalties and damages, including reasonable counsel fees incurred
in investigating or in attempting to avoid the same or oppose the imposition thereof, to the extent
not paid by insurance. The term “Damages” shall also include, but not be limited to, any
Liabilities Deficiency, Subsequent Event Deficiency and/or Contingent Liability, as defined in
Section 4 hereof, to the extent not paid by offsets made against the Contingent Cash Consideration
pursuant to Section 4 hereof and to the extent not paid by insurance. If any of the Damages are
covered by any insurance policies maintained by a Corporation, either before or after Closing
(including the general liability occurrence policy currently maintained by a Corporation), Buyer
shall cause such Corporation to make a claim on

27

 

such insurance in connection with any indemnity claim but no such requirement to make such
claim for insurance shall delay, hinder, avoid or prevent Buyer from asserting or pursuing any
indemnification claim against the Stockholder pursuant to this Section 13 and to recover Damages
from the Stockholder.

               ii. Pre-Closing Liabilities. The term “Pre-Closing Liabilities” as used herein shall
mean (A) any claim, debt, liability or obligation of any of the Corporations of any kind (whether
known or unknown, accrued, absolute, contingent or otherwise) which becomes known, is uncovered or
arises on or after the Closing Date but which pertains to any actions, omissions, debts,
liabilities, obligations, or, to the extent occurring before the Closing Date, facts and events, of
any such Corporation, created or arising before the Closing Date, and (B) any claim against any of
the Corporations for liability which pertains to or arises from services provided by any of the
Corporations prior to the Closing Date, except, as to (A) and (B): (a) liabilities incurred after
the Last Balance Sheet Date in the ordinary course of business that did not, individually or in the
aggregate, have a material adverse effect on the Business of the Corporations, assets, results of
operations, prospects or condition (financial or otherwise) of the Corporations as of the Closing
Date; and (b) liabilities and obligations the responsibility for which has been specifically
addressed by the Parties in this Agreement.

          d. Remedies.

               i. Buyer’s Remedies. In the event Buyer makes written request to Stockholder for the
payment of Damages and Stockholder fails to make the requested payment within thirty (30) days from
the date of delivery of such written request (said thirty (30) day period hereinafter referred to
as the “Stockholder Notice Period”), Buyer shall have the right, in the exercise of its sole
discretion, to either (I) make offset against the Contingent Cash Consideration pursuant to Section
3.b hereof; or (II) require Stockholder to pay Buyer the full amount of such Damages in cash within
the twenty (20) day period following the applicable Stockholder Notice Period (and Stockholder
shall be liable for such amount and for the payment of such amount in full during such period);
provided, however, that Stockholder shall have the option of disputing the validity of the claim or
liability giving rise to the Damages (the “Stockholder Disputed Claim”) by providing written notice
to Buyer of such dispute within the Stockholder Notice Period. The dispute between Buyer and
Stockholder shall be settled by arbitration pursuant to Section 13.e hereof. In the event
Stockholder accepts responsibility for a Stockholder Disputed Claim involving a third party but
desires to contest such Stockholder Disputed Claim and assume all responsibility for the ultimate
outcome thereof, Stockholder shall defend the Stockholder Disputed Claim pursuant to Section 13.f
hereof and shall be liable to Buyer for any and all Damages resulting therefrom.

               ii. Stockholder’ Remedies. In the event Stockholder make written request to Buyer for
the payment of Damages and Buyer fails to make the requested payment within thirty (30) days from
the date of delivery of such written request (said thirty (30) day period hereinafter referred to
as the “Buyer Notice Period”), Stockholder shall have the right to require Buyer to pay Stockholder
the full amount of such Damages in cash within the twenty (20) day period following the applicable
Buyer Notice Period (and Buyer shall be liable for such amount and for the payment of such amount
in full during such period); provided, however, that

28

 

Buyer shall have the option of disputing the validity of the claim or liability giving rise to
the Damages (the “Buyer Disputed Claim”) by providing written notice to Stockholder of such dispute
within the Buyer Notice Period. The dispute between Buyer and Stockholder shall be settled by
arbitration pursuant to Section 13.e hereof. In the event Buyer accepts responsibility for a Buyer
Disputed Claim involving a third party but desires to contest such Buyer Disputed Claim and assume
all responsibility for the ultimate outcome thereof, the Buyer shall defend the Buyer Disputed
Claim pursuant to Section 13.f hereof and shall be liable to Stockholder for any and all Damages
resulting therefrom.

          e. Arbitration. In the event settlement of a Buyer Disputed Claim or Stockholder
Disputed Claim (a “Dispute”) is required to be resolved by arbitration, such arbitration shall be
commenced by written notice from the party claiming such Dispute to the other party that such party
has elected to have such Dispute settled by arbitration. Any Dispute shall be settled by
arbitration in Orlando, Florida and judgment upon the award rendered may be entered in any court
having jurisdiction thereof, under the then current Commercial Arbitration Rules (whereby if three
arbitrators are to be selected, each of the Parties selects one and the arbitrators so selected
choose the third) of the American Arbitration Association (“the Association”). The arbitration
shall be held at a mutually agreeable location in Orlando, Florida and conducted by a panel of
three (3) arbitrators (if the amount in dispute exceeds $100,000) or by a single arbitrator (if the
amount in dispute is equal to or less than $100,000). Not later than ten (10) days after the
delivery of a written notice of a Dispute, the parties shall submit the matter to the Association.
Not later than ten (10) days after the arbitrator(s) are appointed, the arbitrator(s) shall
schedule the arbitration for a hearing to commence on a mutually convenient date. The hearing
shall commence no later than thirty (30) days after the arbitrator(s) are appointed. The
arbitrator(s) shall issue his, her or their award in writing no later than twenty (20) calendar
days after the conclusion of the hearing. In the event the Dispute which is the subject of the
arbitration involves a claim by a third party, the party or parties against whom the claim was made
shall be responsible for taking sufficient legal action to protect such party’s interest until such
time as the arbitrator(s) shall have decided which of Buyer or Stockholder is the responsible
party. Immediately upon the responsible party being determined by the arbitrator(s), the
responsible party shall take control of resolving the claim pursuant to Section 13.f hereof and
shall reimburse the other party for any reasonable expenses incurred by such party prior to taking
such control.

          f. Right to Defend. In the event a party hereto elects to take responsibility for
defending either a Stockholder Disputed Claim or Buyer Disputed Claim pursuant to Section 13.d
hereof, such party (the “Indemnifying Party”) shall defend, contest or otherwise protect against
such suit, action, investigation, claim or proceeding at its own cost and expense, and the other
party (the “Indemnified Party”) must cooperate in any such defense or other action. The
Indemnified Party shall have the right, but not the obligation, to participate at its own expense
in the defense thereof by counsel of its own choosing, but the Indemnifying Party shall be entitled
to control the defense (but shall keep the Indemnified Party informed as to the progress of the
case and, if requested by the Indemnified Party, shall consult with the Indemnified Party as to the
defenses intended to be asserted, the litigation strategies intended to be implemented and the
settlement terms intended to be offered) unless the Indemnified Party has relieved the Indemnifying
Party from liability with respect to the particular matter or the Indemnifying Party

29

 

fails to assume defense of the matter. In the event both the Indemnifying Party and
Indemnified Party are parties to the action, the Indemnifying Party shall take immediate steps to
attempt to have the applicable arbitor dismiss Indemnified Party from such action. If the
Indemnifying Party shall fail to defend, contest or otherwise protect in a timely manner against
any such suit, action, investigation, claim or proceeding, the Indemnified Party shall have the
right, but not the obligation, to defend, contest or otherwise protect against the same and make
any monetary compromise or settlement thereof and recover the entire cost thereof from the
Indemnifying party including reasonable attorneys’ fees, disbursements and all amounts paid as a
result of such suit, action, investigation, claim or proceeding or the compromise or settlement
thereof; provided, however, that the Indemnified Party must send a written notice to the
Indemnifying Party of any such proposed settlement or compromise.

     14. Expenses. The Buyer and Stockholder will each be solely responsible for and shall
bear all of its own respective costs and expenses, including, without limitation, expenses of legal
counsel, accountants and other advisers, incurred at any time in connection with pursuing or
consummating this Agreement and the transactions contemplated thereby, and no such fees of
Stockholder or any of the Corporations shall be borne or accrued by any of the Corporations.

     15. Amendment and Waiver. This Agreement may be amended or modified at any time and
in all respects, or any provisions may be waived by an instrument in writing executed by the Buyer
and Stockholder, or either of them in the case of a waiver.

     16. Assignment; No Third-Party Beneficiaries. Neither this Agreement nor any right
created hereby shall be assignable by Stockholder or the Buyer without the prior written consent of
the other, except for an assignment incident to a merger, consolidation or reorganization. Nothing
in this Agreement, expressed or implied, is intended to confer upon any person, other than the
Parties hereto and their successors, any rights or remedies under or by reason of this Agreement.

     17. Headings. Headings contained in this Agreement are for reference purposes only
and shall not affect in any way the meaning or interpretation of this Agreement.

     18. Counterparts. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute but one and the same
agreement. Facsimile signatures may be deemed binding for this Agreement, or any modification or
amendment thereto, or any documents contemplated hereby.

     19. Gender. All personal pronouns used in this Agreement shall include the other
genders whether used in the masculine or feminine or neuter gender, and the singular shall include
the plural whenever and as often as may be appropriate.

     20. Parties In Interest. All the terms and provisions of this Agreement shall be
binding upon and inure to the benefit of and be enforceable by the Buyer and Stockholder, and their
respective successors and permitted assigns.

30

 

     21. Integrated Agreement; Exhibits. This Agreement constitutes the entire agreement
between the Parties hereto, supersedes any prior understandings, agreements or representations of
the Parties and there are no agreements, understandings, restrictions, warranties, or
representations between the Parties, written or oral, other than those set forth herein or herein
provided for. All of the Exhibits referenced in this Agreement are incorporated into this
Agreement by such reference thereto and made a part hereof.

     22. Choice of Law and Venue. It is the intention of the Parties that the laws of the
State of Florida shall govern the validity of this Agreement, the construction of its terms and the
interpretation of the rights and duties of the Parties, without giving effect to any choice or
conflict of law provision or rule. Any action involving or relating to this Agreement shall be
brought in the state court of appropriate jurisdiction sitting in Orange County, Florida.

     23. Notices. All notices, payments, demands and requests from one Party to the
another, made pursuant to this Agreement or the transactions contemplated hereunder, shall be in
written form and shall be deemed duly given if personally delivered or sent by registered or
certified mail, postage prepaid, return receipt requested, or by Federal Express or other
recognized next-day business couriers, or by fax and followed by hard copy, at the following
addresses:

	 	 	 	 	 
	 

	 	As to Stockholder:
	 	Arcadia Products, Inc.
	 

	 	 	 	c/o Arcadia Resources, Inc.
	 

	 	 	 	9229 Delegates Row, Suite 260
	 

	 	 	 	Indianapolis, Indiana 46240
	 

	 	 	 	Attn: Marvin R. Richardson
	 

	 	 	 	Fax No.: 317-575-6195
	 
	 	 	 	 
	 

	 	With copy to:
	 	David C. Wright, Esq.
	 

	 	 	 	c/o Arcadia Resources, Inc.
	 

	 	 	 	9229 Delegates Row, Suite 260
	 

	 	 	 	Indianapolis, Indiana 46240
	 

	 	 	 	Fax No.: 317-575-6195
	 
	 	 	 	 
	 

	 	As to the Buyer:
	 	Aerocare Holdings, Inc.
	 

	 	 	 	3325 Bartlett Blvd.
	 

	 	 	 	Orlando, Florida 32811
	 

	 	 	 	Attn: Stephen P. Griggs
	 

	 	 	 	Fax No.: 407-206-0010
	 
	 	 	 	 
	 

	 	With copy to:
	 	Thomas A. Simser, Jr., Esq.
	 

	 	 	 	Thomas A. Simser, Jr., P.L.
	 

	 	 	 	P.O. Box 1360
	 

	 	 	 	Hernando, Florida 34442-1360
	 

	 	 	 	Fax No.: 407-386-6552

31

 

     Notice shall be effective (i) if by registered or certified mail, or overnight next-day
business couriers, three (3) days after deposit in the U.S. mail or with such courier, (ii) if by
fax, upon confirmation of successful transmission of such notice, (iii) if by personal delivery,
upon such delivery, and (iv) if by any other permitted means, upon receipt. In the event that any
of the named Parties desire to receive notice at another address, it shall be their responsibility
to notify all of the other Parties, in writing, of the new address.

     24. Further Assurances. From time to time hereafter and without further
consideration, each of the Parties shall execute and deliver such additional or further instruments
of conveyance, assignment and transfer and take such other actions as any of the other Parties may
reasonably request in order to more effectively consummate the transactions contemplated hereunder
or as shall be reasonably necessary or appropriate in connection with the carrying out of the
Parties’ respective obligations hereunder for the purposes of this Agreement. The Parties
understand that, after the Closing, Stockholder may inadvertently receive checks, wire transfers or
other deliveries of monies, which are the property of one or more of the Corporations. Stockholder
agrees to remit such monies to the applicable Corporation promptly after receipt.

     25. Severability. Any term or provision of this Agreement that is invalid or
unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability
of the remaining terms and provisions hereof or the validity or enforceability of the offending
term or provision in any other situation or in any other jurisdiction.

     26. Construction. The Parties have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption
or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any
of the provisions of this Agreement. Any reference to any Federal, state, local, or foreign
statute or law shall be deemed also to refer to all rules and regulations promulgated thereunder,
unless the context requires otherwise. The word “including” shall mean including without
limitation. The words “to the knowledge of” or words of similar effect and import, shall mean and
include such knowledge of facts and circumstances as would reasonably be known to a reasonably
diligence and prudent person carrying out the director, officer and/or employee duties of any such
positions held by the person making such representation or, if such representation is being made on
behalf of a corporation or other business entity, such corporation or other business entity shall
be deemed to have knowledge of such facts and circumstances actually known by, or which should have
reasonably been known by, any member of its board of directors or any of its executive officers.

     27. Limitation of Stockholder’s Liability. The Parties acknowledge and agree that
notwithstanding anything contained within this Agreement to the contrary, in no event shall the
aggregate liability of the Stockholder for any and all losses, Damages (as defined in this
Agreement or otherwise), claims or other amounts that Buyer may incur or suffer, which arises,
results from, or relates to this Agreement or any schedule, exhibit, document, agreement or
instrument furnished or to be furnished by the Stockholder in connection with this Agreement or any
of the transactions contemplated by this Agreement, whether based in contract, tort or
otherwise, exceed, in the aggregate, Four Million Seven Hundred Fifty Thousand Dollars

32

 

($4,750,000); provided that the preceding shall not apply to any such losses, Damages, claims
or other amounts arising or resulting from fraud or intentional misrepresentation of the
Stockholder.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

[SIGNATURE PAGE TO FOLLOW]

33

 

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

	 	 	 	 	 	 	 	 	 
	Signed, sealed and delivered	 	 	 	ARCADIA PRODUCTS, INC., a	 	 
	in the presence of:	 	 	 	Delaware corporation	 	 
	 
	 	 	 	 	 	 	 	 
	/s/ Kristi Lehman

	 	 	 	By:
	 	/s/ Marvin R. Richardson
	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Marvin R. Richardson, President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	Date Executed: 5/18/09	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	“Stockholder”
	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	AEROCARE HOLDINGS, INC., a	 	 
	 	 	 	 	Delaware corporation	 	 
	 
	 	 	 	 	 	 	 	 
	/s/ Patricia Jones

	 	 	 	By:
	 	/s/ Joseph R. Russell	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Joseph P. Russell, Chief
Financial
Officer and Assistant Secretary	 	 
	 
	 	 	 	 	 	 	 	 
	/s/ Scott Bogan	 	 	 	Date Executed: 5/18/09	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	“Buyer”
	 	 

34

 

INDEX TO EXHIBITS

	 	 	 
	Exhibit	 	Description
	 
	 	 
	3-A

	 	Schedule of Wire Instructions
	 
	 	 
	3-G

	 	Allocation Schedule (forms required under Section 338(h)(10)) [TO BE
PREPARED AND DELIVERED POST-CLOSING]
	 
	 	 
	3-I

	 	List of Agreements Pertaining to Rossville Billing Center Transition
	 
	 	 
	6-A

	 	Officers and Directors of Each Corporation
	 
	 	 
	6-B

	 	Certain Distributions
	 
	 	 
	6-C

	 	Financial Statements
	 
	 	 
	6-D

	 	Schedule of Liabilities
	 
	 	 
	6-F

	 	Schedule of Stockholder Agreements
	 
	 	 
	6-G

	 	Schedule of Stockholders, Distributions and Exempted Transactions
	 
	 	 
	6-H

	 	Tax Returns
	 
	 	 
	6-I

	 	Schedule of Litigation and Other Legal Proceedings
	 
	 	 
	6-K1

	 	Schedule of Included Assets
	 
	 	 
	6-K2

	 	Schedule of Excluded Assets
	 
	 	 
	6-M

	 	Schedule of Contracts
	 
	 	 
	6-N

	 	Schedule of Leases and Insurance Policies
	 
	 	 
	6-R

	 	Schedule of Accounts Payable Data [the April 30, 2009 A/P Schedule is to
be delivered at Closing, and the May 15, 2009 A/P Schedule is to
be delivered on or before May 31, 2009]
	 
	 	 
	6-S1

	 	Schedule of Personnel, Payrates and Employment and Non-Compete
Agreements
	 
	 	 
	6-S2

	 	Schedule of Certain Retirement and Other Benefits
	 
	 	 
	6-T

	 	Patients’ List of the Business
	 
	 	 
	6-U

	 	List of Provider Numbers
	 
	 	 
	6-Z

	 	Schedule of Adverse Business Developments
	 
	 	 
	9-E

	 	Legal Opinion of Buyer’s Counsel [TO BE DELIVERED PROMPTLY
AFTER DELIVERY OF THE LEGAL OPINION OF STOCKHOLDER’S AND CORPORATIONS’
COUNSEL]

35

 

	 	 	 
	Exhibit	 	Description
	 
	 	 
	10-C

	 	Legal Opinion of Stockholder’s and Corporations’ Counsel
	 
	 	 
	10-D

	 	Forms of Non-Competition and Non-Solicitation Agreements of Arcadia
Products, Inc., Arcadia Resources, Inc., RKDA, Inc., and SSAC, LLC
d/b/a Arcadia RX
	 
	 	 
	10-E

	 	Form of Employment Agreement of Darian Byrd
	 
	 	 
	10-F

	 	Forms of Guaranty Agreements of Arcadia Resources, Inc. and RKDA,
Inc.
	 
	 	 
	10-G

	 	Forms of Resignations of All Officers and Directors of Each Corporation
	 
	 	 
	10-H

	 	Forms of Required Assignments and Landlord Consents
	 
	 	 
	10-J

	 	Copies of Executed Originals of Release Letters signed by Jana Master
Fund, Ltd., Vicis Capital Master Fund, and LSP Partners, respectively

36

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00159-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00159-of-00352.parquet"}]]