SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report February 26, 1996
WHITMAN MEDICAL CORP.
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(Exact name of registrant as specified in its charter)
New Jersey
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(State or other jurisdiction or incorporation)
1-13722 22-2246554
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(Commission File Number) (IRS Employer Identification No.)
4400 Biscayne Boulevard, Miami, Florida 33137
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(Address of principal executive offices) (Zip Code)
(305) 575-6510
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(Registrant's telephone number, including area code)
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Item 1. Changes in Control of Registrant
Not applicable.
Item 2. Acquisition or Disposition of Assets
Not applicable.
Item 3. Bankruptcy or Receivership
Not applicable.
Item 4. Changes in Registrant's Certifying Accountant
Not applicable.
Item 5. Other Events
1. In connection with the acquisition by Registrant of
Sanford-Brown College in December 1994, Registrant obtained an $8,500,000
credit facility consisting of a $6,000,000 term loan and a $2,500,000 revolving
credit loan from the Bank of America Illinois. The loans, which were due on
April 16, 1996, were obtained on the credit and guaranty of Frost-Nevada
Limited Partnership, Registrant's largest shareholder, whose beneficial owner
is Phillip Frost, M.D., Chairman of the Board of Directors of Registrant. On
February 26, 1996, Registrant and Bank of America Illinois entered into an
amendment to the credit facility extending the term loan for a period of three
years and the revolving credit loan for a period of eighteen months. The
interest rate on the loans continues to be one-half percent below the prime
rate. The loans were extended on the credit and guaranty of Phillip Frost. In
consideration for guarantying the facility, Registrant issued warrants to Dr.
Frost to purchase 650,000 of Registrant's common shares at a price of $8.50 per
share.
2. On February 26, 1996 Registrant changed its
principal executive offices from 485E U.S. Highway 1 South,
Iselin, New Jersey 08830-3005 to 4400 Biscayne Boulevard,
Miami, Florida 33137.
Item 6. Resignations of Registrant's Directors
Not applicable.
2
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Item 7. Financial Statements, Pro Forma Financial
Information and Exhibits
Exhibits:
Exhibit 10.31: Form of Amendment to Credit Agreement
dated February 26, 1996 among Bank of America Illinois, Whitman
Medical Corp. and Phillip Frost.
Exhibit 10.32: Form of Term Note dated February 26,
1996 by Whitman Medical Corp. in favor of Bank of America
Illinois.
Exhibit 10.33: Form of Revolver Note dated February
26, 1996 by Whitman Medical Corp. in favor of Bank of America
Illinois.
Exhibit 10.34: Stock Purchase Warrant to purchase
650,000 shares of common stock issued by Whitman Medical Corp.
in favor of Phillip Frost.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
WHITMAN MEDICAL CORP.
Date: March 12, 1996 By /s/ Randy S. Proto
---------------------------
Randy S. Proto, President
3
<PAGE>
AMENDMENT TO
CREDIT AGREEMENT
THIS AMENDMENT TO CREDIT AGREEMENT, dated as of the day of February,
1996, by and among BANK OF AMERICA ILLINOIS, an Illinois banking corporation
("Bank"); WHITMAN MEDICAL CORP., a New Jersey Corporation ("Borrower"); and
PHILLIP FROST ("Guarantor").
Preliminary Statements
A. Bank, Borrower and Frost-Nevada, Limited Partnership, entered into that
certain Credit Agreement dated December 20, 1994 by which Bank agreed,
subject to the terms of the Credit Agreement, to make a Term Loan to the
Borrower in the principal amount of $6,000,000.00 and to establish a
Revolving Loan for the Borrower in the principal amount of $2,500,000.00.
B. Bank, Borrower and Guarantor desire to amend certain provisions of the
Credit Agreement.
IN CONSIDERATION OF the Preliminary Statements and the mutual covenants
hereinafter set forth, the parties agree that:
1. All of the Preliminary Statements are true and correct and, by this
reference, republished and confirmed. All of the terms of the Credit
Agreement are incorporated in this Amendment as if fully set forth herein.
Terms defined in the Credit Agreement and not otherwise defined herein
shall be used in this Amendment as defined in the Credit Agreement.
2. The Credit Agreement is amended as follows:
2.1 Section 1.1 of the Agreement.
The definition of "Guarantor" in Section 1.1 of the Credit Agreement is
hereby deleted and the following substituted in place thereof:
"Guarantor" shall mean PHILLIP FROST.
The definition of "Transaction Documents" in Section 1.1 of the Credit
Agreement is hereby deleted and the following substituted in place thereof:
"Transaction Documents" shall mean the Credit Agreement, the Amendment
to Credit Agreement the Guarantee of Phillip Frost, the Term Note, the
Revolver Note and any and all amendments to or any assignments of any of
the aforesaid.
2.2 Exhibit A to the Credit Agreement. Exhibit A to the Credit
Agreement is hereby amended as of the date hereof to be in the form set
forth as Exhibit A to this Amendment.
<PAGE>
2.3 Section 2.1(v) of the Credit Agreement is hereby deleted and the
following substituted in place thereof:
(v) Repayment. Borrower agrees to pay the principal indebtedness
evidenced by the Term Note on or before April 14, 1999.
2.4 Exhibit B to the Credit Agreement. Exhibit B to the Credit Agreement
is hereby amended as of the date hereof to be in the form set forth as
Exhibit B to this Amendment.
2.5 Section 2.1 b. (iii) is amended by changing the date "April 14, 1996"
to "October 15, 1997."
2.6 Section 2.1 b. (v) of the Credit Agreement is hereby deleted and the
following substituted in place thereof:
(v) Repayment. Borrower agrees to pay the principal indebtedness
evidenced by the Revolving Note in full on or before October 15, 1997.
2.7 Section 2.4 of the Credit Agreement is hereby deleted and the
following substituted in place thereof:
Guarantor. The repayment of the indebtedness evidenced by the Term
Note and the Revolving Note shall be irrevocably and unconditionally
guaranteed by Phillip Frost. The Guarantee of Frost-Nevada, Limited
Partnership heretofore delivered to the Bank is hereby released.
2.8 Section 6.1 a. of the Credit Agreement is hereby deleted and the
following substituted in place thereof:
a. Quarterly, a financial statement in substantially the format of
statements previously delivered by Borrower, to the Bank with specific
details as to cash flow and such other matters as are required by Bank.
3. WARRANTIES. To induce the Bank to enter into this Amendment, the
Borrower and the Guarantors warrant that:
3.1 No Conflicts. The execution and delivery of this Amendment and the
Replacement Notes (hereinafter defined) and the performance by Borrower of
its obligations under the Agreement, as amended hereby, and the Replacement
Notes, do not and will not conflict with any provision of law or of any
agreement binding upon Borrower.
3.2 Corporate Status. Borrower is a corporation duly formed, validly
existing and in good standing (or its equivalent) under the laws of the State
of New Jersey.
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<PAGE>
3.3 Validity and Binding Effect. The Credit Agreement, as amended hereby,
is, and the Replacement Notes when duly executed and delivered will be,
legal, valid and binding obligations of Borrower, enforceable against
Borrower in accordance with their terms, except as enforceability may be
limited by bankruptcy, insolvency or other similar laws of general principles
of equity limiting the availability of equitable remedies.
3.4 No Default. As of the closing date hereof, no Event of default shall
have occurred and be continuing.
3.5 Warranties. As of the closing date hereof, the warranties in Section 5
of the Credit Agreement and in Section 3 of this Amendment shall be true and
correct as though made on such date, except for such changes as are
specifically permitted under the Credit Agreement and except for litigation
existing against Borrower's wholly owned subsidiary, Ultrasound Technical
Services, Inc. as disclosed to the Bank.
3.6 No Material Change. As of the Closing Date, the Borrower represents
and warrants that there has been no material adverse change in the assets or
the financial condition of Borrower since the financial statements, dated
March 31, 1995.
4. CONDITIONS PRECEDENT TO AMENDMENT. The amendments contemplated by
Section 2. thereof are subject to the satisfaction of each of the following
conditions precedent:
4.1 Documentation. Borrower shall have delivered to Bank all of the
following, each duly executed and dated as of the closing date, in form and
substance satisfactory to Bank:
(a) This Amendment duly signed by Borrower and the Guarantor.
(b) Replacement Notes. Promissory notes of Borrower (the "Replacement
Notes") substantially in the forms set forth as Exhibit A and Exhibit B to
this Amendment. Upon receipt of the Replacement Notes, Bank will: (i)
record the aggregate unpaid principal amount of the Term Note, dated
December 20, 1994 and the Revolving Note, dated December 20, 1994 (the
"Original Notes") issued under the Credit Agreement in its records or, at
its option, on the schedule attached to the applicable Replacement Notes
as the aggregate unpaid principal amount evidenced by each such
Replacement Note; (ii) mark the Original Notes as replaced by the
applicable Replacement Notes; and (iii) return the Original Notes to the
Borrower. Thereafter, all references in the Credit Agreement and any and
all instruments or documents provided for therein or delivered
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<PAGE>
or to be delivered thereunder or in connection therewith referring to the
Original Notes shall be deemed references to the Replacement Notes. The
replacement of the Original Notes with the Replacement Notes shall not be
construed (i) to deem paid or forgiven the unpaid principal amount of, or
unpaid accrued interest on, the Original Notes outstanding at the time of
replacement, or (ii) to release, cancel, terminate or otherwise adversely
affect all or any part of any lien, mortgage, deed of trust, assignment,
pledge, security interest or other encumbrance, if any, heretofore granted
to or for the benefit of the payee of the Original Notes which has not
otherwise been expressly released.
(c) Guarantee. The Guarantee signed by Phillip Frost.
(d) Other. Such other documents as Bank may reasonably request.
5. GENERAL.
5.1 Expenses. Borrower agrees to pay the Bank upon demand for all
reasonable expenses, including reasonable attorneys' and legal assistants'
fees not to exceed $3,500.00 (which attorneys and legal assistants may be
employees of the Bank), incurred by the Bank in connection with the
preparation, negotiation and execution of this Amendment, the Replacement
Notes and any document required to be furnished therewith.
5.2 Law. THIS AMENDMENT AND THE REPLACEMENT NOTES SHALL BE CONSTRUED IN
ACCORDANCE WITH, AND BE GOVERNED BY, THE LAWS OF THE STATE OF ILLINOIS.
5.3 Successors. This Amendment shall be binding upon and inure to the
benefit of Borrower and the Guarantors and their heirs, personal
representatives, successors and permitted assigns, as appropriate, and of
Bank and their successors and assigns.
5.4 Confirmation of the Credit Agreement. Except as amended hereby, the
Credit Agreement shall remain in full force and effect and is hereby ratified
and confirmed in all respects; provided, however, in the event of any
conflict, inconsistency or incongruity between the terms of the Credit
Agreement and the terms of this Amendment, the terms of this Amendment shall
govern and control.
5.5 References to the Credit Agreement. Each reference in the Credit
Agreement to "this Agreement," "hereunder," "hereof," or words of like
import, and each reference to the Credit Agreement in any and all instruments
or documents provided for the
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<PAGE>
Credit Agreement or delivered or to be delivered thereunder or in connection
therewith, shall, except where the context otherwise requires, be deemed a
reference to the Credit Agreement as amended hereby.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of the date first written above.
BANK:
BANK OF AMERICA ILLINOIS
By:
-----------------------------------
Title:
-----------------------------------
BORROWER:
WHITMAN MEDICAL CORP.
By: /s/ Randy S. Proto
-----------------------------------
Title: President
-----------------------------------
GUARANTOR:
/s/ Phillip Frost
-----------------------------------
Phillip Frost
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<PAGE>
TERM NOTE
$6,000,000.00 As of February , 1996
FOR VALUE RECEIVED, WHITMAN MEDICAL CORP., a New Jersey corporation
("Borrower"), promises to pay to the order of
BANK OF AMERICA ILLINOIS,
an Illinois banking corporation ("Lender"), the principal sum of
SIX MILLION DOLLARS
and the Borrower further promises to pay to the Lender interest quarterly,
commencing March 15, 1996, on the principal amount evidenced hereby and from
time to time outstanding at a fluctuating rate per annum equal at all times
to the sum of (i) the Reference Rate, as hereinafter defined, minus (ii)
one-half of one percent (1/2%). The rate of interest to be applied and the
amount of interest to be paid on the daily outstanding balance of principal
evidenced hereby shall be calculated on an assumed year of 360 days for the
number of days actually elapsed. Any change in the Reference Rate will cause
an automatic corresponding change in the hereunder. As used herein, the term,
"Reference Rate", means the rate per annum most recently announced by the
Lender as its reference rate at Chicago, Illinois (or if such rate is not
being quoted, then the rate which is the successor to such rate; and if no
successor rate is being quoted, the rate conceptually equivalent to such rate
which the Lender is then quoting) in any case adjusted to the nearest 1/4 of
one percent or, if there is no nearest 1/4 of one percent, to the next higher
1/4 of one percent, but in no event higher than the maximum lending rate
permitted by law. The Reference Rate as of the date of this Note is Eight and
One-quarter of one percent (8 1/4%).
The Borrower agrees to pay the outstanding principal indebtedness
evidenced by this note in full on April 14, 1999.
The Borrower further promises and agrees that:
1. This note is the "Term Note" referred to in, and is entitled to the
benefits of, that certain Credit Agreement, dated as of December 20, 1994
among the Lender, the Borrower and a third party, as amended by Amendment to
Credit Agreement, dated of even date herewith (hereafter collectively the
"Credit Agreement"), the terms of which are incorporated herein by this
reference as if fully set forth herein. The Borrower may prepay the
indebtedness evidenced by this Note at any time without premium or penalty;
provided, however, any sums which have been prepaid may not be reborrowed.
Page 1 of 4 Pages
<PAGE>
2. The Borrower shall be in default under the terms of this note upon the
occurrence and continuation of an Event of Default as defined and described
in the Credit Agreement.
3. At any time after the occurrence and continuation of any Event of
Default, the indebtedness evidenced by this note and/or any note(s) or other
obligation(s) which may be taken in renewal, extension, substitution, or
modification of all or any part of the indebtedness evidenced thereby and all
other obligations of the Borrower to the Lender, howsoever created and
existing under the Credit Agreement, that certain Revolver Note, dated of
even date herewith, from the Borrower to the Lender or otherwise, shall
immediately become due and payable without demand upon or notice to the
Borrower, and the Lender shall be entitled to exercise the other remedies set
forth in the Credit Agreement or as otherwise provided at law or in equity.
4. Upon the occurrence and during the continuance of any Event of Default,
the Lender is authorized, without further notice to the Borrower (the giving
of notice being expressly waived by the Borrower) to set off and apply any
indebtedness owing by the Lender to the Borrower against the indebtedness
evidenced by this note, although then contingent or unmatured. The Lender
agrees to notify the Borrower after any such setoff and application;
provided, however, the failure to give such notice shall not affect the
validity of such setoff and application. The rights of the Lender under this
Paragraph 4 are in addition to any other rights and remedies which the Lender
may have.
5. The Lender may transfer this note and the transferee(s) shall thereupon
become vested with all the powers, rights, and obligations herein given to
the Lender with respect thereto; and the Lender shall thereafter be forever
relieved and fully discharged from any liability or responsibility in the
matter.
6. The Borrower hereby waives presentment for payment, demand, notice of
dishonor and protest and agrees that (i) any right of setoff securing any
indebtedness evidenced by this note may, from time to time, in whole or in
part, be exchanged or released, and any person liable on or with respect to
the indebtedness evidenced by this note may be released -- all without notice
to or further reservations of rights against the Borrower, any indorser,
surety or guarantor and all without in any way affecting or releasing the
liability of the Borrower, any indorser, surety or guarantor; and (ii) none
of the terms or provisions of this note may be waived; altered, modified or
amended except as the Lender may consent thereto in writing.
7. In the event of any litigation involving this note, the prevailing
party shall be entitled to collect reasonable attorneys' fees, out-of-pocket
expenses, and court costs. As used in this note, the term, "attorneys' fees",
shall mean reasonable charges and expenses for legal services at the trial
and/or appel-
Page 2 of 4 Pages
<PAGE>
late level and/or in pre- and post-judgment or bankruptcy proceedings.
8. Both principal and interest of this note shall be payable in lawful
currency of the United States of America to the Lender at 231 South LaSalle
Street, Chicago, Illinois 60697 or at such other place or to such other
person as may be designated in writing by the Lender, in immediately
available (same day) funds without deduction for or on account of any present
or future taxes levied or imposed on this note, the proceeds hereof, or on
the Borrower or holder hereof by any government, or any instrumentality,
authority or political subdivision thereof. The Borrower agrees, upon the
request of the Lender, to pay all such taxes (other than taxes on or measured
by net income of the holder hereof) in addition to the principal and interest
evidenced by this note.
9. Any installment of principal and/or interest evidenced by this note
which is not paid on the day when such payment is scheduled to be made,
regardless of whether or not the Lender has accelerated payment of any or all
sums outstanding under this note, shall bear interest from the day when due
(including any grace period) until said amount is paid in full, payable on
demand, at a fluctuating interest rate per annum equal at all times to the
sum of (i) the Reference Rate plus (ii) four percent (4%).
10. This note shall be deemed to have been made under and shall be
governed by the laws of the State of Illinois in all respects [except as to
interest rates and other terms of lending which, by virtue of a federal
preemption or, at the election of the Lender, are or may be governed by the
laws of the United States], including matters of construction, validity, and
performance. If any provision of this note shall be deemed unenforceable
under applicable law, such provision shall be ineffective, but only to the
extent of such unenforceability, without invalidating the remainder of such
provision or the remaining provisions of this note. If more than one person
signs this note as a maker, each shall be jointly and severally liable
hereunder. All of the terms and provisions of this note shall be applicable
to and be binding upon each and every maker, indorser, surety, guarantor, all
other persons who are or may become liable for the payment hereof and their
heirs, personal representatives, successors or assigns.
11. THE BORROWER, AND THE LENDER IN ACCEPTING DELIVERY OF THIS NOTE,
HEREBY KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVE THE RIGHT EITHER MAY
HAVE TO A TRIAL BY JURY IN RESPECT TO ANY LITIGATION BASED ON THIS NOTE, THE
CREDIT AGREEMENT OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE OR
THE CREDIT AGREEMENT, AND ANY AGREEMENT SIGNED OR CONTEMPLATED TO BE SIGNED
IN CONJUNCTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF EITHER PARTY OR
Page 3 of 4 Pages
<PAGE>
THE DIRECTORS, OFFICERS, EMPLOYEES OR AGENTS THEREOF. THE INCLUSION OF THIS
PROVISION IS A MATERIAL INDUCEMENT TO THE LENDER TO EXTEND CREDIT TO THE
BORROWER.
WHITMAN MEDICAL CORP.
By: /s/ Randy S. Proto
---------------------------------
Title: President
---------------------------------
***********************************************
STATE OF NEW JERSEY)
COUNTY OF PASSAIC ) ss:
The foregoing instrument was acknowledged before me this day of
February, 1996 by , as of WHITMAN
MEDICAL CORP., a New Jersey corporation. Such officer is personally known to
me or produced his/her driver's license as identification.
/s/ Sylvia Magno
---------------------------------
Notary Public,
Print Name: Sylvia Magno
My Commission Expires: Feb. 9, 2000
Commission No.:
---------------------------------
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<PAGE>
REVOLVER NOTE
$2,500,000.00 As of February , 1996
FOR VALUE RECEIVED, WHITMAN MEDICAL CORP., a New Jersey corporation
("Borrower"), promises to pay to the order of
BANK OF AMERICA ILLINOIS,
an Illinois banking corporation ("Lender"), the principal sum of
TWO MILLION FIVE HUNDRED THOUSAND DOLLARS
and the Borrower further promises to pay to the Lender interest monthly,
commencing March 15, 1996 on the principal amount evidenced hereby and from
time to time outstanding at a fluctuating rate per annum equal at all times
to the sum of (i) the Reference Rate, as hereinafter defined, minus (ii)
one-half of one percent (1/2%). The rate of interest to be applied and the
amount of interest to be paid on the daily outstanding balance of principal
evidenced hereby shall be calculated on an assumed year of 360 days for the
number of days actually elapsed. Any change in the Reference Rate will cause
an automatic corresponding change in the rate hereunder. As used herein, the
term, "Reference Rate", means the rate per annum most recently announced by
the Lender as its reference rate at Chicago, Illinois (or if such rate is not
being quoted, then the rate which is the successor to such rate; and if no
successor rate is being quoted, the rate conceptually equivalent to such rate
which the Lender is then quoting) in any case adjusted to the nearest 1/4 of
one percent or, if there is no nearest 1/4 of one percent, to the next higher
1/4 of one percent, but in no event higher than the maximum lending rate
permitted by law. The Reference Rate as of the date of this Note is Eight and
One-quarter of one percent (8 1/4%).
The Borrower agrees to pay the outstanding principal indebtedness
evidenced by this note in full on October 15, 1997. All advances made
hereunder by the Lender to the Borrower and all payments made on account of
principal hereof shall be recorded by the Lender and, prior to transfer
hereof, endorsed on the grid attached hereto.
The Borrower further promises and agrees that:
1. This note is the "Revolver Note" referred to in, and is entitled to the
benefits of, that certain Credit Agreement, dated as of December 20, 1994
among the Lender, the Borrower and a third party, as amended by Amendment to
Credit Agreement, dated of even date herewith (hereafter collectively the
"Credit Agreement")
Page 1 of 5 Pages
<PAGE>
the terms of which are incorporated herein by this reference as if fully set
forth herein. Provided no Event of Default has occurred and is continuing,
the Borrower may borrow, prepay and reborrow provided the aggregate principal
amount outstanding from time to time and at any time does not exceed
$2,500,000.00
2. The Borrower shall be in default under the terms of this note upon the
occurrence and continuation of an Event of Default as defined and described
in the Credit Agreement.
3. At any time after the occurrence and continuation of any Event of
Default, the indebtedness evidenced by this note and/or any note(s) or other
obligation(s) which may be taken in renewal, extension, substitution, or
modification of all or any part of the indebtedness evidenced thereby and all
other Obligations of the Borrower to the Lender, howsoever created and
existing under the Credit Agreement, that certain Term Note, dated December
20, 1994 from the Borrower to the Lender or otherwise, shall immediately
become due and payable without demand upon or notice to the Borrower, and the
Lender shall be entitled to exercise the other remedies set forth in the
Credit Agreement or as otherwise provided at law or in equity.
4. Upon the occurrence and during the continuance of any Event of Default,
the Lender is authorized, without further notice to the Borrower (the giving
of notice being expressly waived by the Borrower) to set off and apply any
indebtedness owing by the Lender to the Borrower against the indebtedness
evidenced by this note, although then contingent or unmatured. The Lender
agrees to notify the Borrower after any such setoff and application;
provided, however, the failure to give such notice shall not affect the
validity of such setoff and application. The rights of the Lender under this
Paragraph 4 are in addition to any other rights and remedies which the Lender
may have.
5. The Lender may transfer this note and the transferee(s) shall thereupon
become vested with all the powers, rights, and obligations herein given to
the Lender with respect thereto; and the Lender shall thereafter be forever
relieved and fully discharged from any liability or responsibility in the
matter.
6. The Borrower hereby waives presentment for payment, demand, notice of
dishonor and protest and agrees that (i) any right of setoff securing any
indebtedness evidenced by this note may, from time to time, in whole or in
part, be exchanged or released, and any person liable on or with respect to
the indebtedness evidenced by this note may be released -- all without notice
to or further reservations of rights against the Borrower, any indorser,
surety or guarantor and all without in any way affecting or releasing the
liability of the Borrower, any indorser, surety or guarantor; and (ii) none
of the terms or provisions of this note may be waived; altered, modified or
amended except as the Lender may consent thereto in writing.
Page 2 of 5 Pages
<PAGE>
7. In the event of any litigation involving this note, the prevailing
party shall be entitled to collect reasonable attorneys' fees, out-of-pocket
expenses, and court costs. As used in this note, the term, "attorneys' fees",
shall mean reasonable charges and expenses for legal services at the trial
and/or appel- late level and/or in pre- and post-judgment or bankruptcy
proceedings.
8. Both principal and interest of this note shall be payable in lawful
currency of the United States of America to the Lender at 231 South LaSalle
Street, Chicago, Illinois 60697 or at such other place or to such other
person as may be designated in writing by the Lender, in immediately
available (same day) funds without deduction for or on account of any present
or future taxes levied or imposed on this note, the proceeds hereof, or on
the Borrower or holder hereof by any government, or any instrumentality,
authority or political subdivision thereof. The Borrower agrees, upon the
request of the Lender, to pay all such taxes (other than taxes on or measured
by net income of the holder hereof) in addition to the principal and interest
evidenced by this note.
9. Any installment of principal and/or interest evidenced by this note
which is not paid on the day when such payment is scheduled to be made,
regardless of whether or not the Lender has accelerated payment of any or all
sums outstanding under this note, shall bear interest from the day when due
(including any grace period) until said amount is paid in full, payable on
demand, at a fluctuating interest rate per annum equal at all times to the
sum of (i) the Reference Rate plus (ii) four percent (4%).
10. This note shall be deemed to have been made under and shall be
governed by the laws of the State of Illinois in all respects [except as to
interest rates and other terms of lending which, by virtue of a federal
preemption or, at the election of the Lender, are or may be governed by the
laws of the United States], including matters of construction, validity, and
performance. If any provision of this note shall be deemed unenforceable
under applicable law, such provision shall be ineffective, but only to the
extent of such unenforceability, without invalidating the remainder of such
provision or the remaining provisions of this note. If more than one person
signs this note as a maker, each shall be jointly and severally liable
hereunder. All of the terms and provisions of this note shall be applicable
to and be binding upon each and every maker, indorser, surety, guarantor, all
other persons who are or may become liable for the payment hereof and their
heirs, personal representatives, successors or assigns.
11. THE BORROWER, AND THE LENDER IN ACCEPTING DELIVERY OF THIS NOTE,
HEREBY KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVE THE RIGHT EITHER MAY
HAVE TO A TRIAL BY JURY IN RESPECT TO ANY LITIGATION BASED ON THIS NOTE OR
THE CREDIT AGREEMENT OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
NOTE, THE CREDIT
Page 3 of 5 Pages
<PAGE>
AGREEMENT AND ANY OTHER AGREEMENT SIGNED OR CONTEMPLATED TO BE SIGNED IN
CONJUNCTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF EITHER PARTY OR THE DIRECTORS,
OFFICERS, EMPLOYEES OR AGENTS THEREOF. THE INCLUSION OF THIS PROVISION IS A
MATERIAL INDUCEMENT TO THE LENDER TO EXTEND CREDIT TO THE BORROWER.
WHITMAN MEDICAL CORP.
By: /s/ Randy S. Proto
----------------------------------------
Title: President
----------------------------------------
*****************************************************************************
STATE OF NEW JERSEY)
COUNTY OF PASSAIC ) ss:
The foregoing instrument was acknowledged before me this day of
February, 1996 by as of WHITMAN MEDICAL CORP.,
a New Jersey corporation. Such officer is personally known to me or produced
his/her driver's license as identification.
/s/ Sylvia Magno
--------------------------------------------
Notary Public,
Print Name: Sylvia Magno
My Commission Expires: Expires Feb. 9, 2000
Commission No.:
--------------------------------------------
Page 4 of 5 Pages
<PAGE>
ADVANCES AND PAYMENTS OF PRINCIPAL AND INTEREST
<TABLE>
<CAPTION>
DATE AMOUNT OF AMOUNT OF PRIN- AMOUNT OF UNPAID PRIN-
ADVANCE CIPAL PAID OR INTEREST PAID CIPAL BALANCE
PREPAID OF ADVANCES
- -------- ------------- ------------------- ----------------- -----------------
<S> <C> <C> <C> <C>
</TABLE>
Page 5 of 5 Pages
<PAGE>
STOCK PURCHASE WARRANT
TO PURCHASE COMMON STOCK OF
WHITMAN MEDICAL CORP.
<PAGE>
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF
(COLLECTIVELY THE "SECURITIES") HAVE BEEN ACQUIRED FOR INVESTMENT ONLY AND HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR
ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, PLEDGED, HYPOTHECATED, OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO WHITMAN
MEDICAL CORP. THAT AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.
Void after 5:00 p.m. New York Time, on February 25, 2001.
Warrant to Purchase up to 650,000 shares of Common Stock.
WARRANT TO PURCHASE COMMON STOCK
OF
WHITMAN MEDICAL CORP.
This is to Certify That, FOR VALUE RECEIVED, Phillip Frost ("Frost"),
or assigns (collectively, "Holder"), is entitled to purchase, subject to the
provisions of this Warrant, from Whitman Medical Corp., a New Jersey
corporation ("Company"), up to 650,000 fully paid, validly issued and
nonassessable shares of Common Stock, no par value per share, of the Company
("Common Stock") at a price of $8.50 per share at any time or from time to time
during the period from February 26, 1996 to February 25, 2001, but not later
than 5:00 p.m. New York City Time, on February 25, 2001. The number of shares
of Common Stock to be received upon the exercise of this Warrant and the price
to be paid for each share of Common Stock may be adjusted from time to time as
hereinafter set forth. The shares of Common Stock deliverable upon such
exercise, and as adjusted from time to time, are hereinafter sometimes referred
to as "Warrant Shares" and the exercise price of a share of Common Stock in
effect at any time and as adjusted from time to time is hereinafter sometimes
referred to as the "Exercise Price".
(a) EXERCISE OF WARRANT. This Warrant may be exercised in
whole or in part at any time or from time to time on or after February 26, 1996
and until February 25, 2001, provided, however, that (i) if either such day is
a day on which banking institutions in the State of New Jersey are authorized
by law to close, then on the next succeeding day which shall not be such a day,
and (ii) in the event of any merger, consolidation or sale of substantially all
the assets of the Company as an entirety, resulting in any distribution to the
Company's stockholders, prior to February 25, 2001, the Holder shall have the
right to exercise this Warrant commencing at such time through February 25,
2001 into the kind and amount of shares of stock and other securities and
<PAGE>
property (including cash) receivable by a holder of the number of shares of
Common Stock into which this Warrant might have been exercisable immediately
prior thereto. This Warrant may only be exercised subject to the limitations
imposed by the New Jersey Shareholders Protection Act (N.J.S.A. 14A:10A-1 et
seq.), including, without limitation, the prohibitions against entering into
a"business combination" with an "interested shareholder", provided however,
that if at the time of exercise the Company is not subject to such act, no such
limitations shall apply. This Warrant may be exercised by presentation and
surrender hereof to the Company at its principal office, or at the office of
its stock transfer agent, if any, with the Purchase Form annexed hereto duly
executed and accompanied by payment of the Exercise Price for the number of
Warrant Shares specified in such form. As soon as practicable after each such
exercise of the warrants, but not later than seven (7) days from the date of
such exercise, the Company shall issue and deliver to the Holder a certificate
or certificates for the Warrant Shares issuable upon such exercise, registered
in the name of the Holder or its designee. If this Warrant should be exercised
in part only, the Company shall, upon surrender of this Warrant for
cancellation, execute and deliver a new Warrant evidencing the rights of the
Holder thereof to purchase the balance of the Warrant Shares purchasable
thereunder. Upon receipt by the Company of this Warrant at its office, or by
the stock transfer agent of the Company at its office, in proper form for
exercise, the Holder shall be deemed to be the holder of record of the shares
of Common Stock issuable upon such exercise, notwithstanding that the stock
transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be physically delivered
to the Holder.
(b) RESERVATION OF SHARES. The Company shall at all times
reserve for issuance and/or delivery upon exercise of this Warrant such number
of shares of its Common Stock as shall be required for issuance and delivery
upon exercise of the Warrants.
(c) FRACTIONAL SHARES. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon any exercise
hereof, the Company shall pay to the Holder an amount in cash equal to such
fraction multiplied by the current market value of a share, determined as
follows:
(1) If the Common Stock is listed on a National
Securities Exchange or admitted to unlisted trading
privileges on such exchange or listed for trading on the
NASDAQ system, the current market value shall be the last
reported sale price of the Common Stock on such exchange or
system on the last business day prior to the date of exercise
of this Warrant or if no such sale is made on such day, the
average closing bid and asked prices for such day on such
exchange or system; or
(2) If the Common Stock is not so listed or admitted
to unlisted trading privileges, the current market value
shall be the mean of the last reported bid and asked prices
reported by the National Quotations Bureau, Inc. on the last
business day prior to the date of the exercise of this
Warrant; or
2
<PAGE>
(3) If the Common Stock is not so listed or admitted
to unlisted trading privileges and bid and asked prices are
not so reported, the current market value shall be an amount,
not less than book value thereof as at the end of the most
recent fiscal year of the Company ending prior to the date of
the exercise of the Warrant, determined in such reasonable
manner as may be prescribed by the Board of Directors of the
Company.
(d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. This
Warrant is exchangeable, without expense, at the option of the Holder, upon
presentation and surrender hereof to the Company or at the office of its stock
transfer agent, if any, for other warrants of different denominations entitling
the holder thereof to purchase in the aggregate the same number of shares of
Common Stock purchasable hereunder. Upon surrender of this Warrant to the
Company at its principal office or at the office of its stock transfer agent,
if any, with the Assignment Form annexed hereto duly executed and funds
sufficient to pay any transfer tax, the Company shall, without charge, execute
and deliver a new Warrant in the name of the assignee named in such instrument
of assignment and this Warrant shall promptly be cancelled. This Warrant may be
divided or combined with other warrants which carry the same rights upon
presentation hereof at the principal office of the Company or at the office of
its stock transfer agent, if any, together with a written notice specifying the
names and denominations in which new Warrants are to be issued and signed by
the Holder hereof. The term "Warrant" as used herein includes any Warrants into
which this Warrant may be divided or exchanged. Upon receipt by the Company of
evidence satisfactory to it of the loss, theft, destruction or mutilation of
this Warrant, and (in the case of loss, theft or destruction) of reasonably
satisfactory indemnification, and upon surrender and cancellation of this
Warrant, if mutilated, the Company will execute and deliver a new Warrant of
like tenor and date. Any such new Warrant executed and delivered shall
constitute an additional contractual obligation on the part of the Company,
whether or not this Warrant so lost, stolen, destroyed, or mutilated shall be
at any time enforceable by anyone.
(e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue
hereof, be entitled to any rights of a shareholder in the Company, either at
law or equity, and the rights of the Holder are limited to those expressed in
the Warrant and are not enforceable against the Company except to the extent
set forth herein.
(f) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at
any time and the number and kind of securities purchasable upon the exercise of
the Warrants shall be subject to adjustment from time to time upon the
happening of certain events as follows:
(1) In case the Company shall (i) declare a dividend
or make a distribution on its outstanding shares of Common
Stock in shares of Common Stock, (ii) subdivide or reclassify
its outstanding shares of Common Stock into a greater number
of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the
Exercise Price in effect at the time of the record date for
such dividend or distribution or of the effective date of
such
3
<PAGE>
subdivision, combination or reclassification shall be
adjusted so that it shall equal the price determined by
multiplying the Exercise Price by a fraction, the denominator
of which shall be the number of shares of Common Stock
outstanding after giving effect to such action, and the
numerator of which shall be the number of shares of Common
Stock outstanding immediately prior to such action. Such
adjustment shall be made successively whenever any event
listed above shall occur.
(2) In case the Company shall fix a record date for
the issuance of rights or warrants to all holders of its
Common Stock entitling them to subscribed for or purchase
shares of Common Stock (or securities convertible into Common
Stock) at a price (the "Subscription Price") (or having a
conversion price per share) less than the current market
price of the Common Stock (as defined in Subsection (8)
below) on the record date mentioned below, or less than the
Exercise Price on such record date the Exercise Price shall
be adjusted so that the same shall equal the lower of (i) the
price determined by multiplying the Exercise Price in effect
immediately prior to the date of such issuance by a fraction,
the numerator of which shall be the sum of the number of
shares of Common Stock outstanding on the record date
mentioned below and the number of additional shares of Common
Stock which the aggregate offering price of the total number
of shares of Common Stock so offered (or the aggregate
conversion price of the convertible securities so offered)
would purchase at such current market price per share of the
Common Stock, and the denominator of which shall be the sum
of the number of shares of Common Stock outstanding on such
record date and the number of additional shares of Common
Stock offered for subscription or purchase (or into which the
convertible securities so offered are convertible) or (ii) in
the event the Subscription Price is equal to or higher than
the current market price but is less than the Exercise Price,
the price determined by multiplying the Exercise Price in
effect immediately prior to the date of issuance by a
fraction, the numerator of which shall be the sum of the
number of shares outstanding on the record date mentioned
below and the number of additional shares of Common Stock
which the aggregate offering price of the total number of
shares of Common Stock so offered (or the aggregate
conversion price of the convertible securities so offered)
would purchase at the Exercise Price in effect immediately
prior to the date of such issuance, and the denominator of
which shall be the sum of the number of shares of Common
Stock outstanding on the record date mentioned below and the
number of additional shares of Common Stock offered for
subscription or purchase (or into which the convertible
securities so offered are convertible). Such adjustment shall
be made successively whenever such rights or warrants are
issued and shall become effective immediately after the
record date for the determination of shareholders entitled to
receive such rights or warrants; and to the extent that
shares of Common Stock are not delivered (or securities
convertible into Common Stock are not delivered) after the
expiration of such rights or warrants the Exercise Price
shall be readjusted to the Exercise Price which would then be
in effect had the adjustments made upon the issuance of such
rights or warrants been made
4
<PAGE>
upon the basis of delivery of only the number of shares of
Common Stock (or securities convertible into Common Stock)
actually delivered.
(3) In case the Company shall hereafter distribute
to the holders of its Common Stock evidences of its
indebtedness or assets (excluding cash dividends or
distributions and dividends or distributions referred to in
Subsection (1) above) or subscription rights or warrants
(excluding those referred to in Subsection (2) above), then
in each such case the Exercise Price in effect thereafter
shall be determined by multiplying the Exercise Price in
effect immediately prior thereto by a fraction, the numerator
of which shall be the total number of shares of Common Stock
outstanding multiplied by the current market price per share
of Common Stock (as defined in Subsection (8) below), less
the fair market value (as determined by the Company's Board
of Directors) of said assets or evidences of indebtedness so
distributed or of such rights or warrants, and the
denominator of which shall be the total number of shares of
Common Stock outstanding multiplied by such current market
price per share of Common Stock. Such adjustment shall be
made successively whenever such a record date is fixed. Such
adjustment shall be made whenever any such distribution is
made and shall become effective immediately after the record
date for the determination of shareholders entitled to
receive such distribution.
(4) In case the Company shall issue shares of its
Common Stock excluding shares issued (i) in any of the
transactions described in Subsection (1) above, (ii) upon
exercise of options granted pursuant to the Company's Stock
Option Plan, (iii) upon exercise of warrants outstanding at
February 26, 1996 and this Warrant and (iv) to shareholders
of any corporation which merges into the Company in
proportion to their stock holdings of such corporation
immediately prior to such merger, upon such merger, or issued
in a bona fide public offering pursuant to a firm commitment
underwriting, but only if no adjustment is required pursuant
to any other specific subsection of this Section (f) (without
regard to Subsection (9) below) with respect to the
transaction giving rise to such rights for a consideration
per share (the "Offering Price") less than the current market
price per share (as defined in Subsection (8) below) on the
date the Company fixes the offering price of such additional
shares or less than the Exercise Price, the Exercise Price
shall be adjusted immediately thereafter so that it shall
equal the lower of (i) the price determined by multiplying
the Exercise Price in effect immediately prior thereto by a
fraction, the numerator of which shall be the sum of the
number of shares of Common Stock outstanding immediately
prior to the issuance of such additional shares and the
number of shares of Common Stock which the aggregate
consideration received (determined as provided in Subsection
(7) below) for the issuance of such additional shares would
purchase at such current market price per share of Common
Stock, and the denominator of which shall be the number of
shares of Common Stock outstanding immediately after the
issuance of such additional shares or (ii) in the
5
<PAGE>
event the Offering Price is equal to or higher than the
current market price per share but less than the Exercise
Price, the price determined by multiplying the Exercise Price
in effect immediately prior to the date of issuance by a
fraction, the numerator of which shall be the number of
shares of Common Stock outstanding immediately prior to the
issuance of such additional shares and the number of shares
of Common Stock which the aggregate consideration received
(determined as provided in Subsection (7) below) for the
issuance of such additional shares would purchase at the
Exercise Price in effect immediately prior to the date of
such issuance, and the denominator of which shall be the
number of shares of Common Stock outstanding immediately
after the issuance of such additional shares. Such adjustment
shall be made successively whenever such an issuance is made.
(5) In case the Company shall issue any securities
convertible into or exchangeable for its Common Stock
(excluding securities issued in transactions described in
Subsections (2) and (3) above) for a consideration per share
of Common Stock (the "Conversion Price") initially
deliverable upon conversion or exchange or such securities
(determined as provided in Subsection (7) below) less than
the current market price per share (as defined in Subsection
(8) below) in effect immediately prior to the issuance of
such securities, or less than the Exercise Price, the
Exercise Price shall be adjusted immediately thereafter so
that it shall equal the lower of (i) the price determined by
multiplying the Exercise Price in effect immediately prior
thereto by a fraction, the numerator of which shall be the
sum of the number of shares of Common Stock outstanding
immediately prior to the issuance of such securities and the
number of shares of Common Stock which the aggregate
consideration received (determined as provided in Subsection
(7) below) for such securities would purchase at such current
market price per share of Common Stock, and the denominator
of which shall be the sum of the number of shares of Common
Stock outstanding immediately prior to such issuance and the
maximum number of shares of Common Stock of the Company
deliverable upon conversion of or in exchange for such
securities at the initial conversion or exchange price or
rate or (ii) in the event the Conversion Price is equal to or
higher than the current market price per share but less than
the Exercise Price, the price determined by multiplying the
Exercise Price in effect immediately prior to the date of
issuance by a fraction, the numerator of which shall be the
sum of the number of shares outstanding immediately prior to
the issuance of such securities and the number of shares of
Common Stock which the aggregate consideration received
(determined as provided in Subsection (7) below) for such
securities would purchase at the Exercise Price in effect
immediately prior to the date of such issuance, and the
denominator of which shall be the sum of the number of shares
of Common Stock outstanding immediately prior to the issuance
of such securities and the maximum number of shares of Common
Stock of the Company deliverable upon conversion of or in
exchange for such securities at the initial conversion or
exchange price or rate. Such adjustment shall be made
successively whenever such an issuance is made.
6
<PAGE>
(6) Whenever the Exercise Price payable upon
exercise of each Warrant is adjusted pursuant to Subsections
(1), (2), (3), (4) and (5) above, the number of Shares
purchasable upon exercise of this Warrant shall
simultaneously be adjusted by multiplying the number of
Shares initially issuable upon exercise of this Warrant by
the Exercise Price in effect on the date hereof and dividing
the product so obtained by the Exercise Price, as adjusted.
(7) For purposes of any computation respecting
consideration received pursuant to Subsections (4) and (5)
above, the following shall apply:
(A) in the case of the issuance of shares
of Common Stock for cash, the consideration shall be
the amount of such cash, provided that in no case
shall any deduction be made for any commissions,
discounts or other expenses incurred by the Company
for any underwriting of the issue or otherwise in
connection therewith;
(B) in the case of the issuance of shares
of Common Stock for a consideration in whole or in
part other than cash, the consideration other than
cash shall be deemed to be the fair market value
thereof as determined in good faith by the Board of
Directors of the Company (irrespective of the
accounting treatment thereof), whose determination
shall be conclusive; and
(C) in the case of the issuance of
securities convertible into or exchangeable for
shares of Common Stock, the aggregate consideration
received therefor shall be deemed to be the
consideration received by the Company for the
issuance of such securities plus the additional
minimum consideration, if any, to be received by the
Company upon the conversion or exchange thereof the
consideration in each case to be determined in the
same manner as provided in clauses (A) and (B) of
this Subsection (7).
(8) For the purpose of any computation under
Subsections (2), (3), (4) and (5) above, the current market
price per share of Common Stock at any date shall be deemed
to be the lower of (i) the average of the daily closing
prices for 30 consecutive business days before such date or
(ii) the closing price on the business day immediately
preceding such date. The closing price for each day shall be
the last sale price regular way or, in case no such reported
sale takes place on such day, the average of the last
reported bid and asked prices regular way, in either case on
the principal national securities exchange on which the
Common Stock is admitted to trading or listed, or if not
listed or admitted to trading on such exchange, the average
of the highest reported bid and lowest reported asked prices
as reported by NASDAQ, or other similar organization if
NASDAQ is no longer reporting such information, or if not so
available, the fair market price as determined by the Board
of Directors.
7
<PAGE>
(9) No adjustment in the Exercise Price shall be
required unless such adjustment would require an increase or
decrease of at least one cent ($0.01) in such price;
provided, however, that any adjustments which by reason of
this Subsection (9) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations
under this Section (f) shall be made to the nearest cent or
to the nearest one-hundredth of a share, as the case may be.
Anything in this Section (f) to the contrary notwithstanding,
the Company shall be entitled, but shall not be required, to
make such changes in the Exercise Price, in addition to those
required by this Section (f), as it shall determine, in its
sole discretion, to be advisable in order that any dividend
or distribution in shares of Common Stock, or any
subdivision, reclassification or combination of Common Stock,
hereafter made by the Company shall not result in any Federal
Income tax liability to the holders of Common Stock or
securities convertible into Common Stock (including
Warrants).
(10) Whenever the Exercise Price is adjusted, as
herein provided, the Company shall promptly cause a notice
setting forth the adjusted Exercise Price and adjusted number
of Shares issuable upon exercise of each Warrant to be mailed
to the Holders, at their last addresses appearing in the
Warrant Register, and shall cause a certified copy thereof to
be mailed to its transfer agent, if any. The Company may
retain a firm of independent certified public accountants
selected by the Board of Directors (who may be the regular
accountants employed by the Company) to make any computation
required by this Section (f), and a certificate signed by
such firm shall be conclusive evidence of the correctness of
such adjustment.
(11) In the event that at any time, as a result of
an adjustment made pursuant to Subsection (1) above, the
Holder of this Warrant thereafter shall become entitled to
receive any shares of the Company, other than Common Stock,
thereafter the number of such other shares so receivable upon
exercise of this Warrant shall be subject to adjustment from
time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the Common
Stock contained in Subsections (1) to (9), inclusive above.
(12) Irrespective of any adjustments in the Exercise
Price or the number or kind of shares purchasable upon
exercise of this Warrant, Warrants theretofore or thereafter
issued may continue to express the same price and number and
kind of shares as are stated in the similar Warrants
initially issuable pursuant to this Agreement.
(g) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall
be adjusted as required by the provisions of the foregoing Section, the Company
shall forthwith file in the custody of its Secretary or an Assistant Secretary
at its principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein
8
<PAGE>
provided, setting forth in reasonable detail the facts requiring such
adjustment, including a statement of the number of additional shares of Common
Stock, if any, and such other facts as shall be necessary to show the reason
for and the manner of computing such adjustment. Each such officer's
certificate shall be made available at all reasonable times for inspection by
the holder or any holder of a Warrant executed and delivered pursuant to
Section (a) and the Company shall, forthwith after each such adjustment, mail a
copy by certified mail of such certificate to the Holder or any such holder.
(h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall
be outstanding, (i) if the Company shall pay any dividend or make any
distribution upon the Common Stock or (ii) if the Company shall offer to the
holders of Common Stock for subscription or purchase by them any share of any
class or any other rights of (iii) if any capital reorganization of the
Company, reclassification of the capital stock of the Company, consolidation or
merger of the Company with or into another corporation, sale, lease or transfer
of all or substantially all of the property and assets of the Company to
another corporation, or voluntary or involuntary dissolution, liquidation or
winding up of the Company shall be effected, then in any such case, the Company
shall cause to be mailed by certified mail to the Holder, at least fifteen days
prior the date specified in (x) or (y) below, as the case may be, a notice
containing a brief description of the proposed action and stating the date on
which (x) a record is to be taken for the purpose of such dividend,
distribution or rights, or (y) such reclassification, reorganization,
consolidation, merger, conveyance, lease, dissolution, liquidation or winding
up is to take place and the date, if any is to be fixed, as of which the
holders of Common Stock or other securities shall receive cash or other
property deliverable upon such reclassification, reorganization, consolidation,
merger, conveyance, dissolution, liquidation or winding up.
(i) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of
any reclassification, capital reorganization or other change of outstanding
shares of Common Stock of the Company, or in case of any consolidation or
merger of the Company with or into another corporation (other than a merger
with a subsidiary in which merger the Company is the continuing corporation and
which does not result in any reclassification, capital reorganization or other
change of outstanding shares of Common Stock of the class issuable upon
exercise of this Warrant) or in case of any sale, lease or conveyance to
another corporation of the property of the Company as an entirety, the Company
shall, as a condition precedent to such transaction, cause effective provisions
to be made so that the Holder shall have the right thereafter by exercising
this Warrant at any time prior to the expiration of the Warrant, to purchase
the kind and amount of shares of stock and other securities and property
receivable upon such reclassification, capital reorganization and other change,
consolidation, merger, sale or conveyance by a holder of the number of shares
of Common Stock which might have been purchased upon exercise of this Warrant
immediately prior to such reclassification, change, consolidation, merger, sale
or conveyance. Any such provision shall include provision for adjustments which
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Warrant. The foregoing provisions of this Section (i) shall
similarly apply to successive reclassifications, capital reorganizations and
changes of shares of Common Stock and to successive consolidations, mergers,
sales or conveyances. In the event that in connection with
9
<PAGE>
any such capital reorganization or reclassification, consolidation, merger,
sale or conveyance, additional shares of Common Stock shall be issued in
exchange, conversion, substitution or payment, in whole or in part, for a
security of the Company other than Common Stock, any such issue shall be
treated as an issue of Common Stock covered by the provisions of Subsection (1)
of Section (f) hereof.
IN WITNESS whereof, the Company has duly executed this Warrant
as of the date below.
WHITMAN MEDICAL CORP.
By: /s/ Randy S. Proto
-------------------------------
Name: Randy S. Proto
Title: President
[SEAL]
Dated: February 26, 1996
Attest:
/s/ Fernando Fernandez
- -------------------------------
Fernando Fernandez, Secretary
10
<PAGE>
PURCHASER FORM
Dated ,
---------- --------
The undersigned hereby irrevocably elects to exercise the
within Warrant to the extent of purchasing shares of Common Stock and
--------
hereby makes payment of in payment of the actual exercise price thereof.
---------
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name
---------------------------------------------
(Please typewrite or print in block letters)
Address
-----------------------------------------
Signature
----------------------
ASSIGNMENT FORM
FOR VALUED RECEIVED,
-------------------------
hereby sells, assigns and transfers unto
Name
---------------------------------------------
(Please typewrite or print in block letters)
Address
------------------------------------------
the right to purchase Common Stock represented by this Warrant to the extent of
shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint Attorney, to transfer the same on the books of the
Company with full power of substitution in the premises.
Date ,
-------------- --------------
Signature
------------------------
11
