S

S. G. Reader & Associates, Inc.

Practice Management Consultants

January 30, 2012

Drs. Howard Golden and Michael Wax

2879 East Point Street

East Point, GA 30358

Re: Atlanta Injury Specialists

2879 East Point Street

East Point, GA 30358

Dear Drs. Golden and Wax:

Following the usual and customary (standard) principles in evaluating a clinic price, the (initial

trial run) evaluation price for Atlanta Injury Specialists as of January 30, 2012, is $90,474.00.

The $90,474.00 includes:

Furnishings and equipment - @ $26,289.00

Patient Files - @ $54,185.00

Leasehold Improvements @ $10,000.00

Sundries - @ N/A

Patient File evaluation is based on the Clinic's 12 month accumulative collections beginning

January 2010 and ending December 2011, less the Clinic's operating expenses ending 12 months

December 2011. The net cash flow (patient files) is multiplied by 12 months.

Evaluation Variable Final is set at $79,950.00

Evaluation Variable Final is a variable from the evaluation price and represents the final

evaluation price. Evaluation Variable Final is based primarily on:

1. Desirability of area.

2. Clinic establishment within the area.

3. Staff and patient momentum within the clinic.

4. General comp of what practices sold for within the region.

5. Net Income to Debt Service Ratio.

6. Collections to asking price ratio.

Net Income To Debt Service Ratio: 4.08

The evaluation is good through December 31, 2012.

EVALUATION NOTES

FURNITURE AND EQUIPMENT

Furnishings and equipment for the office were listed at (insurance) replacement (estimated

new price less 3% depreciation) value. All equipment and furnishings are in good condition.

Furnishings and equipment were listed by Drs. Howard Golden and Michael Wax to S.G.

Reader and Associates, Inc. as of January 2012.

PATIENT FILES

Patient files evaluation is based on the clinic's 12 month accumulative collections beginning

January 2010 and ending December 2011. Total collections of $109,165.00, less direct and

indirect overhead of $54,980.00, leaves a net cash flow of $54,185.00. The net cash flow of

$54,185.00 is multiplied by one year (12 months) equaling $54,185.00.

*The net cash flow multiplied variable ranges from 12 to 18 months. Collections to asking

price ratio, counter-balances and justifies the range to be multiplied.

LEASEHOLD IMPROVEMENTS

Leasehold improvements totaled approximately $10,000.00. These improvements were

absorbed (cash out of pocket) by Drs. Howard Golden and Michael Wax and not worked into

term of lease.

EVALUATION VARIABLE FINAL

Each of the six variables (listed on the cover sheet) has the potential to discount the evaluation

price by up to 6% per category and/or 45% per major anomaly.

Discounts applied - 5. Net Income to Debt Service Ratio.

*Of the six variables listed on the cover sheet, collections to asking price ratio and/or net

income to debt service ratio can increase or decrease the patient files value by adjusting the

percentage to industry standard.

Collections to asking price ratio, is 1.46%.

(i.e.: $116,774.00 collections divided by $79,950.00 asking price = 1.46%)

Atlanta Injury Specialists collections to asking price ratio places generously within industry

average. Collections to asking price industry ratio average range, 92-1.35%. Attempting to

adjust collections to asking price ratio to a modest range within industry average such as 1.24

to 1.28% was declined in order to meet the funders net income to debt service ratio comfort

cushion of 4.08. The net income to debt service ratio trumps collections to asking price ratio

in the final analysis. The collections to asking price ratio index chart is as follows: 92-1.02 =

poor, 1.03-1.11 = fair, 1.12-1.17 = good, 1.18-1.28 = great, 1.29-1.75 = superb. This chart

evolved by precedence created from a history of practice sales within the country or in other

words, a comp. The bulk of practice sales for this region lands within 1.24-1.35 on the index

chart.NET INCOME TO DEBT SERVICE RATIO

The funders net income to debt service ratio is 4.08. In other words, the net income to the

owner of the clinic is well over four times after debt service to the funder. The comfort

cushion for the funder is usually 3 to 4 times the annual debt service. On the average, many

clinics will net 3 to 4 times its debt service. This, of course, is based on a 10 year note @

the current rate of 6% interest. The evaluation variable final of 4.08 is based on the sellers

asking price of $79,950.00. The 4.08 would place this clinic under the main stream (common

activity) for practice sale price.

For example:

$54,185.00 (net cash flow) - $10,651.00 (annual debt service) = $43,534.00 (net-net cash flow).

$43,534.00 (net-net cash flow) $10,651.00 (annual debt service) = 4.08 (net income to debt service ratio).

RECEIVABLES PLEASE NOTE: The receivables are not included in the practice evaluation. Industry standard will separate the receivables from the Clinic evaluation, as receivables will fluctuate day to day. In the event buyer purchases the receivables, a formula against the receivables will be applied just prior to purchase and/or close of sale.

Atlanta Injury Specialists

Total Discretionary Income

Profit & Loss

Jan-Dec 2011

CONTRACT LABOR DOCTOR

$100.00

MARKETING

$4,418.00

PAYROLL

SALARY D.C.

$42,000.00

TAXES

$3,717.00

PETTY CASH

$800.00

PROFESSIONAL FEES BOOKKEEPING

$1,943.00

TOTAL DISCRETIONARY INCOME (Add Backs)

$52,978.00

ADD BACKS WERE IDENTIFIED BY SGR, INC. WITH ASSISTANCE FROM

DR. HOWARD GOLDEN.CONFIDENTIAL PROFILE

TYPE OF BUSINESS: CHIROPRACTIC OFFICE

NAME OF BUSINESS: ATLANTA INJURY SPECIALISTS

ADDRESS: 2879 EAST POINT STREET

CITY: EAST POINT STATE: GA ZIP: 30358

SELLERS NAME: DRS. HOWARD GOLDEN AND MICHAEL WAX

BUS. PHONE: DO NOT CALL OR DROP IN WITHOUT PERMISSION

OFFICE: (928) 282-8434

EVALUATED AT: $79,950.00

SELLERS ASKING PRICE: $79,950.00

INCOME STATUS

12 MONTH ACCUMULATIVE AVERAGE INCOME PERIOD: 01/10-12/11

COLLECTIONS: $109,165.00 NET CASH FLOW: $54,185.00

NEW PATIENTS: 95 - Est. TOTAL VISITS: 999 - Est.

RETENTION: 10.51 CASE FEE: $1,149.10

CASH PER VISIT AV: $109.27

ASSETS

EQUIPMENT, FURNISHINGS: $26,289.00 GOODWILL $30,661.00

INVENTORY (AT COST): 0

SUNDRIES: N/A

NON-COMPETE COVENANT: $3,000.00 OTHER: Addl Furnishings: $10,000.00

TRADE NAME: $10,000.00 TOTAL: $79,950.00

GENERAL INFORMATION

YEARS ESTABLISHED: 6 YEARS EMPLOYEES: 1-CA

YEARS BY OWNER: 6 YEARS TRAINING PERIOD: OPEN

DAYS OPEN: 5 DAYS SELLERS DUTIES: CHIROPRACTOR

HOURS OPEN: M/W/F 9-1, 3-7 - T/TH 12-7 REASON: RETIRING

TECHNIQUE: FULL SPINE / DROP

COMMENTS:

STRONG BLUE COLLAR IDEAL PERSONAL INJURY COMMUNITY. NEW DC CAN EASILY DOUBLE or TRIPLE NUMBERS WITH LITTLE MARKETING AND ATTORNEY NETWORKING SKILLS. PERFECT TURN-KEY PRACTICE OPPORTUNITY.