Document:

EXHIBIT 4.9

                                     Warrant

THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE HEREOF
HAVE NOT BEEN REGISTERED UNDER EITHER THE SECURITIES ACT OF 1933 (THE "ACT") OR
APPLICABLE STATE SECURITIES LAWS (THE "STATE ACTS") AND SHALL NOT BE SOLD,
PLEDGED, HYPOTHECATED, DONATED, OR OTHERWISE TRANSFERRED (WHETHER OR NOT FOR
CONSIDERATION) BY THE HOLDER EXCEPT UPON THE ISSUANCE TO THE COMPANY OF A
FAVORABLE OPINION OF COUNSEL OR SUBMISSION TO THE COMPANY OF SUCH EVIDENCE AS
MAY BE SATISFACTORY TO COUNSEL TO THE COMPANY, IN EACH SUCH CASE, TO THE EFFECT
THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF THE ACT AND THE STATE ACTS.

WARRANT TO PURCHASE FORTY-FOUR THOUSAND, THREE HUNDRED, TWENTY (44,320) SHARES
OF COMMON STOCK

                           INNOVATIVE MEDICAL SERVICES
                           (a California Corporation)
                     Not Transferable or Exercisable Except
                        upon Conditions Herein Specified
                              Void after 5:00 P.M.,
                   Pacific Standard Time, on the July 31, 2002

         Innovative Medical Services, a California corporation (the "Company")
hereby certifies that, ___________, as the registered holder hereof (the
"Holder"), for value received, is entitled to purchase from the Company the
number of fully paid and non-assessable shares of Common Stock of the Company
(the "Shares"), stated above at the purchase price of $3.468 per Share (the
"Exercise Price") (the number of Shares and Exercise Price being subject to
adjustment as hereinafter provided) upon the terms and conditions herein
provided.

         1. Exercise of Warrants.

     (a) Subject to subsection (b) of this Section 1 and Section 11 below, upon
presentation and surrender of this Warrant Certificate, with the attached
Purchase Form duly executed, at the principal office of the Company at 1725
Gillespie Way, El Cajon, California 92020 or at such other place as the Company
may designate by notice to the Holder hereof, together with a certified or bank
cashier's check payable to the order of the Company in the amount of the
Exercise Price times the number of Shares being purchased, the Company shall
deliver to the Holder hereof, as promptly as practicable, certificates
representing the Shares being purchased. This Warrant may be exercised in whole
or in part; and, in case of exercise hereof in part only, the Company, upon
surrender hereof, will deliver to the Holder a new Warrant Certificate or
Warrant Certificates of like tenor entitling the Holder to purchase the number
of Shares as to which this Warrant has not been exercised.

     (b) This Warrant may be exercised in whole or in part at any time prior to
5:00 o'clock P.M., Pacific Standard Time, on July 31, 2002.
<PAGE>
     2. Exchange and Transfer of Warrant. This Warrant (a) at any time prior to
the exercise hereof, upon presentation and surrender to the Company, may be
exchanged, alone or with other Warrants of like tenor registered in the name of
the Holder, for another Warrant or other Warrants of like tenor in the name of
such Holder exercisable for the same aggregate number of Shares as the Warrant
or Warrants surrendered, (b) may not be sold, transferred, hypothecated, or
assigned, in whole or in part, without the prior written consent of the Company,
which shall not be unreasonably withheld.

     3. Rights and Obligations of Warrant Holder.

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

     (b) No Holder of this Warrant Certificate, as such, shall be entitled to
vote or receive distributions or to be deemed the holder of Shares for any
purpose, nor shall anything contained in this Warrant Certificate be construed
to confer upon any Holder of this Warrant Certificate, as such, any of the
rights of a stockholder of the Company or any right to vote, give or withhold
consent to any action by the Company, whether upon any recapitalization, issue
of stock, reclassification of stock, merger, conveyance or otherwise, receive
notice of meetings or other action affecting stockholders (except for notices
provided for herein), receive distributions, subscription rights, or otherwise,
until this Warrant shall have been exercised and the Shares purchasable upon the
exercise thereof shall have become deliverable as provided herein; provided,
however, that any such exercise on any date when the stock transfer books of the
Company shall be closed shall constitute the person or persons in whose name or
names the certificate or certificates for those Shares are to be issued as the
record holder or holders thereof for all purposes at the opening of business on
the next succeeding day on which such stock transfer books are open, and the
Warrant surrendered shall not be deemed to have been exercised, in whole or in
part as the case may be, until the next succeeding day on which stock transfer
books are open for the purpose of determining entitlement to distributions on
the Company's common stock.
<PAGE>
     4. Shares Underlying Warrants. The Company covenants and agrees that all
Shares delivered upon exercise of this Warrant shall, upon delivery and payment
therefor, be duly and validly authorized and issued, fully-paid and
non-assessable, and free from all stamp taxes, liens, and charges with respect
to the purchase thereof In addition, the Company agrees at all times to reserve
and keep available an authorized number of Shares sufficient to permit the
exercise in full of this Warrant.

     5. Disposition of Warrants or Shares.

     (a) The holder of this Warrant Certificate and any transferee hereof or of
the Shares issuable upon the exercise of the Warrant Certificate, by their
acceptance hereof, hereby understand and agree that the Warrant, and the Shares
issuable upon the exercise hereof, have not been registered under either the
Securities Act of 1933 (the "Act") or applicable state securities laws (the
"State Acts") and shall not be sold, pledged, hypothecated, donated, or
otherwise transferred (whether or not for consideration) except upon the
issuance to the Company of a favorable opinion of counsel or submission to the
Company of such evidence as may be satisfactory to counsel to the Company, in
each such case, to the effect that any such transfer shall not be in violation
of the Act and the State Acts. It shall be a condition to the transfer of this
Warrant that any transferee thereof deliver to the Company its written agreement
to accept and be bound by all of the terms and conditions of this Warrant
Certificate.

     (b) Unless and until there is an effective registration statement filed
with the U.S. Securities and Exchange Commission for the Common Stock underlying
the Warrant, the stock certificates of the Company that will evidence the shares
of Common Stock with respect to which this Warrant may be exercisable will be
imprinted with conspicuous legend in substantially the following form:

               "The securities represented by this certificate have not been
               registered under either the Securities Act of 1933 (the "Act") or
               applicable state securities laws (the "State Acts") and shall not
               be sold, pledged, hypothecated, donated or otherwise transferred
               (whether or not for consideration) by the holder except upon the
               issuance to the Company of a favorable opinion of its counsel or
               submission to the company of such other evidence as may be
               satisfactory to counsel of the Company, in each such case, to the
               effect that any such transfer shall not be in violation of the
               Act and the State Acts."

The Company has agreed to register the Common Stock with respect to which this
Warrant may be exercisable for distribution in accordance with the provisions of
the Act pursuant to a registration statement to be filed with the U.S.
Securities and Exchange Commission on or before May 31, 2001.

     6. Adjustments. The number of Shares purchasable upon the exercise of each
Warrant is subject to adjustment from time to time upon the occurrence of any of
the events enumerated below.
<PAGE>
     (a) In case the Company shall: (i) pay a dividend in Shares, (ii) subdivide
its outstanding Shares into a greater number of Shares, (iii) combine its
outstanding Shares into a smaller number of Shares, or (iv) issue, by
reclassification of its Shares, any shares of its capital stock, the amount of
Shares purchasable upon the exercise of each Warrant immediately prior thereto
shall be adjusted so that the Holder shall be entitled to receive upon exercise
of the Warrant that number of Shares which such Holder would have owned or would
have been entitled to receive after the happening of such event had such Holder
exercised the Warrant immediately prior to the record date, in the case of such
dividend, or the effective date, in the case of any such subdivision,
combination or reclassification. An adjustment made pursuant to this subsection
(a) shall be made whenever any of such events shall occur, but shall become
effective retroactively after such record date or such effective date, as the
case may be, as to Warrants exercised between such record date or effective date
and the date of happening of any such event.

     (b) In case the Company shall issue rights or warrants to all holders of
its Shares entitling them to subscribe for or to purchase Shares at a price per
Share which, when added to the amount of consideration received or receivable by
the Company for such rights or warrants, is less than the Current Market Price
(as hereinafter defined) per Share at the record date, the number of Shares
purchasable upon the exercise of this Warrant shall be adjusted so that
thereafter, until further adjusted, each Warrant shall entitle the Holder to
purchase that number of Shares determined by multiplying the number of Shares
purchasable hereunder by a fraction, the numerator of which shall be the number
of additional Shares issuable upon the exercise of such rights or warrants, and
the denominator of which shall be the number of Shares which an amount equal to
the sum of (i) the aggregate exercise price of the total number of Shares
issuable upon the exercise of such rights or warrants, and (ii) the aggregate
amount of consideration, if any, received, or receivable by the Company for such
rights or warrants, would purchase at such Current Market Price. Such adjustment
shall be made whenever such rights or warrants are issued, but shall also be
effective retroactively as to Warrants exercised between the record date for the
determination of stockholders entitled to receive such rights or warrants and
the date such rights or warrants are issued.

     (c) For the purpose of any computation under subsection (b) above, the
Current Market Price per Share at any date shall be: (i) if the Shares are
listed on any national securities exchange, the average of the daily closing
prices for the 15 consecutive business days commencing 20 business days before
the day in question (the "Trading Period"); (ii) if the Shares are not listed on
any national securities exchange but are quoted on the Nasdaq SmallCap Market,
the average of the high and low bids as reported by NASDAQ for the Trading
Period; and (iii) if the Shares are neither listed on any national securities
exchange nor quoted on NASDAQ, the higher of (x) the exercise price then in
effect, or (y) the tangible book value per Share as of the end of the Company's
immediately preceding fiscal year.

     (d) No adjustment shall be required unless such adjustment would require an
increase or decrease of at least 1% in the number of Shares purchasable
hereunder; provided, however, that any adjustments which by reason of this
subsection (d) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations under this Section 6
shall be made to the nearest one-hundredth of a Share.
<PAGE>

     (e) No adjustment shall be made in any of the following cases:

          (i) Upon the grant or exercise of stock options now or hereafter
     granted, or under any employee stock option or stock purchase plan now or
     hereafter authorized, to the extent that the aggregate of the number of
     Shares which may be purchased under such options and the number of Shares
     issued under such employee stock purchase plan is less than or equal to 10%
     of the number of Shares outstanding on January 1 of the year of the grant
     or exercise;

          (ii) Shares issued upon the conversion of any of the Company's
     convertible or exchangeable securities;

          (iii) Shares issued in connection with the acquisition by the Company
     or by any subsidiary of the Company of 80% or more of the assets of another
     corporation or entity, and Shares issued in connection with the acquisition
     by the Company or by any subsidiary of the Company of 80% or more of the
     voting shares of another corporation (including Shares issued in connection
     with such acquisition of voting shares of such other corporation subsequent
     to the acquisition of an aggregate of 80% of such voting shares), Shares
     issued in a merger of the Company or a subsidiary of the Company with
     another corporation in which the Company or the Company's subsidiary is the
     surviving corporation, and Shares issued upon the conversion of other
     securities issued in connection with any such acquisition or in any such
     merger; and

          (iv) Shares issued pursuant to this Warrant and pursuant to all stock
     options and warrants outstanding on the date hereof.

     (f) Notice to Warrant Holders of Adjustment. Whenever the number of Shares
purchasable hereunder is adjusted as herein provided, the Company shall cause to
be mailed to the Holder in accordance with the provisions of this Section 6 a
notice (i) stating that the number of Shares purchasable upon exercise of this
Warrant have been adjusted, (ii) setting forth the adjusted number of Shares
purchasable upon the exercise of a Warrant, and (iii) showing in reasonable
detail the computations and the facts, including the amount of consideration
received or deemed to have been received by the Company, upon which such
adjustments are based.

     7. Fractional Shares. The Company shall not be required to issue any
fraction of a Share upon the exercise of Warrants. If more than one Warrant
shall be surrendered for exercise at one time by the same Holder, the number of
full Shares which shall be issuable upon exercise thereof shall be computed on
the basis of the aggregate number of Shares with respect to which this Warrant
is exercised. If any fractional interest in a Share shall be deliverable upon
the exercise of this Warrant, the Company shall make an adjustment therefor in
cash equal to such fraction multiplied by the Current Market Price of the Shares
on the business day next preceding the day of exercise.
<PAGE>
     8. Loss or Destruction. Upon receipt of evidence satisfactory to the
Company of the loss, theft, destruction, or mutilation of this Warrant
Certificate and, in the case of any such loss, theft or destruction, upon
delivery of an indemnity agreement or bond satisfactory in form, substance and
amount to the Company or, in the case of any such mutilation, upon surrender and
cancellation of this Warrant Certificate, the Company at its expense will
execute and deliver, in lieu thereof, a new Warrant Certificate of like tenor.

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

     10. Notices. Whenever any notice, payment of any purchase price, or other
communication is required to be given or delivered under the terms of this
Warrant, it shall be in writing and delivered by hand delivery or United States
registered or certified mail, return receipt requested, postage prepaid, and
will be deemed to have been given or delivered on the date such notice, purchase
price or other communication is so delivered or posted, as the case may be; and,
if to the Company, it will be addressed to the address specified in Section 1
hereof, and if to the Holder, it will be addressed to the registered Holder at
its, his or her address as it appears on the books of the Company.

     11. Redemption of Warrants Provided that there is an effective registration
statement for the Shares and the Warrant Shares, this Warrant may be redeemed by
the Company upon thirty days written notice to the Holder for $0.10 per Warrant
Share provided that the closing sale price for the Company's common stock as
reported by its trading market has been not less than $7.00 per share for ten
consecutive trading days. Unless this Warrant has been exercised pursuant to
Section 1 on or before the thirtieth day following the date of the written
notice, this Warrant shall be null and void save only the Company's obligation
to pay the redemption amount.

INNOVATIVE MEDICAL SERVICES

By:
   ---------------------------
   Michael L. Krall, President
   July 31, 2001

<PAGE>

                                  PURCHASE FORM

DATE:
      ----------------------

TO:      INNOVATIVE MEDICAL SERVICES

     The undersigned hereby irrevocably elects to exercise the attached Warrant
Certificate to the extent of ____ shares of the Common Stock, of INNOVATIVE
MEDICAL SERVICES and hereby makes payment of $_______ ($3.468 x # OF WARRANTS
EXERCISED) in accordance with the provisions of Section 1 of the Warrant
Certificate in payment of the purchase price thereof.

                     INSTRUCTIONS FOR REGISTRATION OF STOCK

Name:
        --------------------------------------------------------------
        (Please typewrite or print in block letters)

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

By:
         --------------------------------------------
         Signature of Record Holder

<PAGE><PAGE>   1

                                                                   EXHIBIT 10.69

                                                      U.S. Department of Justice
                                                          United States Attorney
                                                         District of Connecticut

                                                                   June 25, 2001

Via Facsimile (203) 977-7301

Stanley A. Twardy, Jr., Esq.
Andrew P. Gaillard, Esq.
Day, Berry & Howard LLP
One Canterbury Green
Stamford, CT  06901-2047

        Re:    U.S. v. Raytel Cardiac Services, Inc.

Dear Mr. Twardy and Mr. Gaillard:

        This letter confirms the plea agreement entered into between your
client, Raytel Cardiac Services, Inc. ("Raytel" or the "defendant"), and the
United States Attorney's Office for the District of Connecticut (the
"Government") concerning the referenced criminal matter.

I.      The Plea and Offense

        The defendant agrees to waive its right to be indicted and to plead
guilty to a one-count information charging it with obstruction of a criminal
investigation, in violation of Title 18 U.S.C. Section 1518. It is understood
that to be guilty of this offense the following essential elements of the
offense must be satisfied:

        (1)     The defendant willfully obstructed, misled, delayed or attempted
                to obstruct, mislead, or delay communication of information or
                records, as described in the information;

        (2)     relating to a violation of Federal health care offense;

        (3)     to a criminal investigator.

<PAGE>   2

                                      -2-
                                                    Stanley A. Twardy, Jr., Esq.
                                                        Andrew P. Gaillard, Esq.
                                                                   June 25, 2001

II.     The Penalties

        This offense carries a maximum penalty of 5 years imprisonment and a
fine. The defendant also is subject to the alternative fine provision of 18
U.S.C. Section 3571. Under this section, the maximum fine that may be imposed on
the defendant is the greatest of the following amounts: (1) twice the gross gain
to the defendant resulting from the offense; and (2) twice the gross loss
resulting from the offense; or (3) $500,000.

        In addition, the defendant is obligated by 18 U.S.C. Section 3013 to pay
a special assessment of $400.00 on each count of conviction. The defendant
agrees to pay the special assessment to the Clerk of the court on the day of
sentencing.

        Finally, unless otherwise ordered, should the Court impose a fine of
more than $2,500 as part of the sentence, interest will be charged on the unpaid
balance of a fine amount not paid within 15 days after the judgment date. 18
U.S.C. Section 3612(f). Other penalties and fines may be assessed on the unpaid
balance of a fine pursuant to 18 U.S.C. Sections 3571 (h), (I) and Section
3612(g).

III.    Sentence Agreement

        The Government and the defendant have agreed, pursuant to Federal Rule
of Criminal Procedure 11(e)(1)(C), that the following sentence is an appropriate
disposition of this case:

A.      Fine

        In light of the defendant's financial condition, the parties agree that
restitution and a separate but related civil settlement, as set forth below, is
appropriate in lieu of a criminal fine in this matter.

B.      Restitution

        The defendant agrees to make restitution in the amount of $5,000,000.00
($5 Million Dollars) to the United States, the victim of its criminal conduct.
RAYTEL will pay restitution in the amount of $5,000,000.00 as follows: $1
Million within thirty (30) days of the plea; $1.5 Million on or before June 30,
2002; $1.5 Million on or before June 30, 2003; and the remaining $1 Million on
or before June 30, 2004.

<PAGE>   3

                                      -3-
                                                    Stanley A. Twardy, Jr., Esq.
                                                        Andrew P. Gaillard, Esq.
                                                                   June 25, 2001

        The defendant understands that if it fails to make such agreed-upon
restitution that the Government may seek to void this agreement. The order of
restitution shall be a condition of probation or supervised release. Failure to
pay restitution may also result in the defendant's re-sentencing to any sentence
which might originally have been imposed by the Court. See 18 U.S.C. Section
3614.

        The Government notes that, contemporaneous with this plea, the defendant
has negotiated and will enter into a separate civil settlement regarding false
claims in the amount of $11,500,000.00 ($11.5 Million Dollars), with credit
allowed for $5,000,000.00 to be ordered and paid as restitution in this case. As
part of the Civil Settlement, the defendant will enter into a Corporate
Integrity Agreement to ensure future compliance.

C.      Probation

        The defendant will be on probation for a period of three years from the
date of sentencing.

IV.     Sentencing Guidelines

        As noted above, the parties have reached agreement as to an appropriate
sentence to be imposed.

                A.      Applicability

        The defendant understands that the Sentencing Reform Act of 1984 and the
Sentencing Guidelines apply in this case. The defendant understands that the
Court is required to consider any applicable Sentencing Guidelines but may
depart from those Guidelines under some circumstances. The defendant expressly
understands that the Sentencing Guideline determinations will be made by the
Court, based upon input from the defendant and the Government. The defendant
further understands that it may withdraw its guilty plea if its sentence or the
Guideline application is other than the parties have agreed and set forth
herein.

                B.      Information to the Court

        It is expressly understood that the Government will discuss the facts of
this case with the United States Probation Office

<PAGE>   4

                                      -4-
                                                    Stanley A. Twardy, Jr., Esq.
                                                        Andrew P. Gaillard, Esq.
                                                                   June 25, 2001

and will provide the Probation Officer with access to its file, with the
exception of grand jury material.

V.      Corporate Authorization

        The defendant will provide to the Office of the United States Attorney
and to the Court written evidence, in the form of a notarized resolution of the
Board of directors with a notary seal, documenting that the defendant is
authorized to waive its right to indictment, to plead guilty to the Information
in this case, and to enter into and comply with all provisions of this
agreement. The resolution shall further certify that Jason Sholder, President of
Raytel Cardiac Services, Inc., is authorized to take these actions, and that all
corporate formalities required for such authorization, including approval by the
defendant's directors, have been observed.

        The defendant agrees that Jason Sholder shall appear on behalf of the
defendant to waive indictment, to enter a plea of guilty, and to receive the
imposition of sentence by the Court.

VI.     Cooperation with Law Enforcement

        The defendant agrees to cooperate truthfully and completely with the
United States in its investigation of possible violations of federal and state
law and in any trial or other proceedings arising out of the investigation of
the defendant and any of its present and former officers and employees.

        A.      General Obligations

        The defendant agrees to cooperate with the Government's continuing
investigation of individuals and understands and agrees its cooperation
obligations will require it to do the following:

        1)      provide access to original documents and records, including
                electronically stored records;

        2)      provide access to defendant's experts and consultants (other
                than legal counsel as set forth in Section B below) and copies
                of their records, reports and documents as retained and prepared
                prior to June 23, 2000;

<PAGE>   5

                                      -5-
                                                    Stanley A. Twardy, Jr., Esq.
                                                        Andrew P. Gaillard, Esq.
                                                                   June 25, 2001

        3)      upon the Government's request, after reasonable notice, arrange
                for and provide access to defendant's business premises,
                including technical equipment, to obtain and/or review
                documents, records or other evidence necessary to the
                Government's ongoing investigation and/or prosecution of
                individuals;

        4)      permit and encourage the defendant's directors, officers and
                employees to cooperate fully and truthfully with the United
                States and to disclose all information with respect to their
                activities and those of others relating to violations of federal
                criminal laws.

        B.      Attorney-Client and Work Product Privileges

        The defendant agrees to further cooperate with the Government's
continuing investigation by waiving the attorney-client, work product and other
privileges relating to documents and/or evidence, all for the period prior to
June 23, 2000, pertaining to the defendant's pacemaker testing business as
called for in the "Custodian of Records" subpoenas served upon the defendant in
this matter, as well as other written or verbal requests for records and/or
evidence made to date in lieu of subpoena.

        The defendant agrees to further cooperate with the Government's
continuing investigation by waiving the attorney-client, work product and other
privileges, relating to documents and/or evidence, not previously subpoenaed or
requested by the Government, all for the period prior to June 23, 2000, in the
following areas: 1) documents and/or evidence regarding Medicare Audits relating
or applicable to the pacemaker testing business, and the anti-kickback laws
and/or regulations; 2) documents and/or evidence regarding asset purchase
agreements relating or applicable to the pacemaker testing business, and the
anti-kickback laws and/or regulations; 3) documents and/or evidence regarding
internal audits relating or applicable to the pacemaker testing business, and
the anti-kickback laws and/or regulations; 4) documents and/or evidence
regarding compliance with Medicare regulations relating or applicable to the
pacemaker testing business, and the anti-kickback laws and/or regulations; and
5) documents and/or evidence relating to payments of commissions to sales
representatives relating or

<PAGE>   6

                                      -6-
                                                    Stanley A. Twardy, Jr., Esq.
                                                        Andrew P. Gaillard, Esq.
                                                                   June 25, 2001

applicable to the pacemaker testing business, and the anti-kickback laws and/or
regulations.

        If an individual raises an assertion of the advice of counsel defense in
reliance upon documents and/or evidence not covered above, the defendant will
not object to the individual employee's disclosure of or the Government's
inquiry into such evidence, and upon reasonable notice (in writing) of the
individual's or the Government's intention, the defendant will waive the
privilege.

        The parties acknowledge and agree that by entering into this agreement
and waiver of privileges, the defendant does not and will not waive its
attorney-client, work product, or other privileges with respect to other
documents.

        C.      Notifications

        If the defendant complies with all the terms of this agreement, the
United States will, upon request of the defendant, advise the Court and any
federal, state or local government agency, including licensing agencies or
authorities, of the nature and extent of any cooperation provided by the
defendant.

VII.    Waiver of Rights

        A.      Waiver of Right to Indictment

        The defendant understands that it has the right to have the facts of
this case presented to a federal grand jury, consisting of between sixteen and
twenty-three citizens, twelve of whom would have to find probable cause to
believe that it committed the offense set forth in the information before an
indictment could be returned. The defendant expressly acknowledges that it is
waiving its right to be indicted knowingly and intelligently.

        B.      Waiver of Trial Rights and Consequences of Plea

        The defendant understands that it has the right to be represented by an
attorney at every stage of the proceeding and, if necessary, one will be
appointed to represent it.

        The defendant understands that it has the right to plead not guilty or
to persist in that plea if it has already been

<PAGE>   7

                                      -7-
                                                    Stanley A. Twardy, Jr., Esq.
                                                        Andrew P. Gaillard, Esq.
                                                                   June 25, 2001

made, the right to be tried by a jury with the assistance of counsel, the right
to confront and cross-examine the witnesses against it, the right not to be
compelled to incriminate itself, and the right to compulsory process for the
attendance of witnesses to testify in its defense. The defendant understands
that by pleading guilty it waives and gives up those rights and that if the plea
of guilty is accepted by the Court, there will not be a further trial of any
kind.

        The defendant understands that if it pleads guilty, the Court may ask
its authorized representative questions about each offense to which it pleads
guilty, and if he answers those questions falsely under oath, on the record, and
in the presence of counsel, his answers may later be used against him in a
prosecution for perjury or making false statements.

VIII.   Waiver of Statute of Limitations

        The defendant understands and agrees that should the conviction
following defendant's plea of guilty pursuant to this plea agreement be vacated
for any reason, then any prosecution that is not time-barred by the applicable
statute of limitations on the date of the signing of this plea agreement
(including any indictment or counts the government has agreed to dismiss at
sentencing pursuant to this plea agreement) may be commenced or reinstated
against defendant, notwithstanding the expiration of the statute of limitations
between the signing of this plea agreement and the commencement or reinstatement
of such prosecution. The defendant agrees to waive all defenses based on the
statute of limitations with respect to any prosecution that is not time-barred
on the date the plea agreement is signed.

IX.     Acknowledgment of Guilt; Voluntariness of Plea

        The defendant acknowledges that it is entering into this agreement and
is pleading guilty freely and voluntarily because it is guilty. The defendant
further acknowledges that it is entering into this agreement without reliance
upon any discussions between the Government and it (other than those described
in the plea agreement letter), without promise of benefit of any kind (other
than the concessions contained in the plea agreement letter), and without
threats, force, intimidation, or coercion of any kind. The defendant further
acknowledges its understanding of the nature of the offense to

<PAGE>   8

                                      -8-
                                                    Stanley A. Twardy, Jr., Esq.
                                                        Andrew P. Gaillard, Esq.
                                                                   June 25, 2001

which it is pleading guilty, including the penalties provided by law. The
defendant also acknowledges its complete satisfaction with the representation
and advice received from its undersigned attorney. The defendant and its
undersigned counsel are unaware of any conflict of interest concerning counsel's
representation of the defendant in the case. Finally, the defendant acknowledges
that the undersigned representative is authorized and empowered to act in this
matter on behalf of the defendant corporation.

X.      Scope of Agreement

        The defendant acknowledges and understands that this agreement is
limited to the undersigned parties and cannot bind any other federal authority,
or any state or local authority. The defendant acknowledges that no
representations have been made to it with respect to any civil or administrative
consequences that may result from this plea of guilty because such matters are
solely within the province and discretion of the specific administrative or
governmental entity involved. Finally, the defendant understands and
acknowledges that this agreement has been reached without regard to any civil
tax matters that may be pending or which may arise involving it.

XI.     Collateral Consequences

        The defendant further understands that it will be adjudicated guilty of
the offense to which it has pleaded guilty and may thereby be deprived of
certain federal benefits and rights. The defendant understands that the
Government reserves the right to notify any state or federal agency by whom it
is licensed, or with whom it does business, of the fact of its conviction.

XII.    Satisfaction of Federal Criminal Liability; Breach

        The defendant's guilty plea, if accepted by the Court, will satisfy the
federal criminal liability of the defendant for all violations of the federal
health care and related laws now known to this office and the Office of
Inspector General of the Department of Health and Human Services ("HHS-OIG")
that could be brought in the District of Connecticut.

        The defendant understands that if, before sentencing, it violates any
term or condition of this agreement, engages in any

<PAGE>   9

                                      -9-
                                                    Stanley A. Twardy, Jr., Esq.
                                                        Andrew P. Gaillard, Esq.
                                                                   June 25, 2001

criminal activity, the Government may void all or part of this agreement.

XIII.   Other Promises

        The defendant acknowledges that no other promises, agreements, or
conditions have been entered into other than those set forth in this plea
agreement, and none will be entered into unless set forth in writing, signed by
all the parties.

        This letter shall be presented to the Court, in open court, and filed in
this case.

                                         Very truly yours,

                                         JOHN A. DANAHER, III
                                         UNITED STATES ATTORNEY

                                         MARIA A. KAHN
                                         ASSISTANT UNITED STATES ATTORNEY

        I certify that I have been authorized by formal action of the Board of
Directors of Raytel Cardiac Services, Inc. to act on behalf of the defendant, I
have read this plea agreement letter and its attachment(s), have had ample time
to discuss this agreement with counsel and fully understand and accept its
terms.

/s/ Jason Sholder                                              6/25/2001
-----------------------------------                            ---------
RAYTEL CARDIAC SERVICES, INC.                                    Date
The Defendant, by Jason Sholder,
President of Raytel Cardiac
Services, Inc.

        I have thoroughly read, reviewed and explained this plea agreement to my
client, Raytel Cardiac Services, Inc., which, acting here through its President,
advises me that it understands and accepts its terms.

/s/ Stanley A. Twardy, Jr.                                     6/25/01
-----------------------------------                            -------
Stanley A. Twardy, Jr., Esq.                                     Date
Andrew P. Gaillard, Esq.
Attorneys for the Defendant

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