Document:

Form-S2_012601.htm

                                                                  EXHIBIT 10.4

                                WARRANT AGREEMENT

                                 BY AND BETWEEN

                              MEDIX RESOURCES, INC.

                                       AND

                                   ROYCAP INC.

                          DATED AS OF DECEMBER 29, 2000

                              TABLE OF CONTENTS

Article I WARRANT CERTIFICATES
  Section 1.1  Warrant Certificates
  Section 1.2  Execution of Warrant Certificates
  Section 1.3  Registration of Warrant Certificates
  Section 1.4  Exchange and Transfer of Warrant Certificates
  Section 1.5  Lost, Stolen, Mutilated or Destroyed Warrant Certificates
  Section 1.6  Cancellation of Warrant Certificates

Article II WARRANT EXERCISE PRICE AND EXERCISE OF WARRANTS
  Section 2.1  Exercise Price
  Section 2.2  Registration of Warrants and Warrant Shares
  Section 2.3  Procedure for Exercise of Warrants
  Section 2.4  Issuance of Common Stock
  Section 2.5  Certificates for Unexercised Warrants
  Section 2.6  Reservation of Shares
  Section 2.7  No Impairment

Article III ADJUSTMENTS AND NOTICE PROVISIONS
  Section 3.1  Adjustment of Exercise Price
  Section 3.2  Certificate of Adjustments
  Section 3.3  Warrant Certificate Amendments
  Section 3.4  Fractional Shares

ARTICLE VI MISCELLANEOUS
  Section 4.1  Payment of Taxes and Charges
  Section 4.2  Changes to Agreement
  Section 4.3  Assignment
  Section 4.4  Successor to Company
  Section 4.5  Notices
  Section 4.6  Defects in Notice
  Section 4.7  Governing Law
  Section 4.8  Standing
  Section 4.9  Headings
  Section 4.10 Counterparts
  Section 4.11 Availability of the Agreement
  Section 4.12 Entire Agreement

                                WARRANT AGREEMENT

            THIS WARRANT  AGREEMENT  (the  "Agreement"),  dated as of December
29, 2000,  is entered into by and between  Medix  Resources,  Inc., a Colorado
corporation  (the  "Company"),  and RoyCap Inc., an Ontario  corporation  (the
"Purchaser").

                                   WITNESSETH:

            WHEREAS,  the Company proposes to sell to Purchaser  pursuant to a
Securities  Purchase  Agreement,  dated as of the date hereof (the "Securities
Purchase  Agreement"),  by and  between  the  Company  and  the  Purchaser,  a
Convertible  Note (the  "Convertible  Note") of the Company  which permits the
Company to draw up to $2,500,000 ;

            AND  WHEREAS  the  Convertible  Note and the  Securities  Purchase
Agreement  provides for the  conversion  of a number of shares of Common Stock
of the  Company,  for  the  issuance  of a  warrant  to the  Purchaser  in the
circumstances  set  out  in  Section  5 of the  Convertible  Note  (the  "Call
Warrant") and further  provides for the issuance of warrants to purchase up to
1,250,000  shares of Common  Stock,  $0.001 par value per share of the Company
at an  exercise  price as  described  herein  (the  "Advance  Warrants").  The
Advance Warrants and the Call Warrant are  collectively  referred to herein as
the "Warrants".  The Common Stock issuable upon exercise of the Warrants shall
be referred to herein as the "Warrant Shares".

            NOW,  THEREFORE,  in  consideration  of  the  premises  and of the
mutual agreements herein contained, the parties hereto agree as follows:

                              WARRANT CERTIFICATES
Warrant  Certificates.   Contemporaneously  with  the  execution  hereof,  the
Company  shall issue a warrant  certificate  (the  "Warrant  Certificate")  to
acquire  500,000  shares of the Common Stock of the Company  substantially  in
the form of Exhibit A attached  hereto.  Thereafter,  the Company  shall issue
Warrant  Certificates  substantially in the form of Exhibit B attached hereto,
each of which is a Warrant to acquire  250,000  shares of the Common  Stock of
the Company,  contemporaneously with the advance of each of Tranche 3, Tranche
4 and  Tranche 5, as  defined in the  Securities  Purchase  Agreement.  In the
circumstances  where the  Company is required  to issue the Call  Warrant,  it
shall be  substantially  in the form of  Exhibit C attached  hereto.  All such
Warrant  Certificates  shall be issued  together with the form of the election
to purchase (the "Election to Purchase") and assignment (the  "Assignment") to
be attached  thereto,  and, in  addition,  may have such  letters,  numbers or
other marks of identification or designation and such legends,  summaries,  or
endorsements  stamped,  printed,  lithographed  or  engraved  thereon  as  the
Company may deem appropriate and as are not  inconsistent  with the provisions
of this  Agreement,  or as, in any  particular  case,  may be  required in the
opinion of counsel  for the  Company,  to comply with any law or with any rule
or  regulation  of any  regulatory  authority  or  agency,  or to  conform  to
customary usage.

Execution  of  Warrant   Certificates.   The  Warrant  Certificates  shall  be
executed  on  behalf  of the  Company  by its  Chairman  or  President  or any
Executive  Vice  President  and  attested  to by its  Secretary  or  Assistant
Secretary,  either  manually or by facsimile  signature  printed  thereon.  In
case any  authorized  officer of the  Company who shall have signed any of the
Warrant  Certificates  shall  cease to be an  officer  of the  Company  either
before  or  after  delivery  thereof  by the  Company  to any  Purchaser,  the
signature  of  such  person  on  such  Warrant  Certificates  shall  be  valid
nevertheless  and such  Warrant  Certificates  may be issued and  delivered to
those persons  entitled to receive the Warrants  represented  thereby with the
same  force  and  effect  as  though  the  person  who  signed  such   Warrant
Certificates had not ceased to be an officer of the Company.

Registration  of Warrant  Certificates.  The Company  shall  number and keep a
registry for the Warrant  Certificates  in a register as they are needed.  The
Company  may  deem  and  treat  the   registered   holder(s)  of  the  Warrant
Certificates  (the  "Holders")  as  the  absolute  owner(s)  thereof  for  all
purposes and the Company shall not be affected by any notice to the contrary.

Exchange and Transfer of Warrant  Certificates.  The Warrant  Certificates may
be transferred or exchanged in accordance  with the provisions of Section 2(a)
thereof.

Lost,  Stolen,  Mutilated or Destroyed  Warrant  Certificates.  If any Warrant
Certificate shall be mutilated,  lost, stolen or destroyed,  the Company shall
issue,  execute  and  deliver,  in  exchange  and  substitution  for and  upon
cancellation  of a  mutilated  Warrant  Certificate,  or  in  lieu  of  or  in
substitution  for a lost,  stolen  or  destroyed  Warrant  Certificate,  a new
Warrant  Certificate  representing an equivalent number of Warrants or Warrant
Shares.  If  required  by the  Company,  the  Holder of the  mutilated,  lost,
stolen or destroyed Warrant  Certificate must provide indemnity  sufficient to
protect  the  Company  from  any  loss  which  it may  suffer  if the  Warrant
Certificate is replaced.  Any such new Warrant  Certificate  shall  constitute
an  original  contractual  obligation  of the  Company,  whether  or  not  the
allegedly lost,  stolen,  mutilated or destroyed Warrant  Certificate shall be
at any time enforceable by anyone.

Cancellation  of Warrant  Certificates.  Any Warrant  Certificate  surrendered
upon the  exercise of Warrants or for  exchange or  transfer,  or purchased or
otherwise  acquired  by the  Company,  shall  be  canceled  and  shall  not be
reissued  by the  Company;  and,  except as  provided in Section 2.5 hereof in
case of the exercise of less than all of the  Warrants  evidenced by a Warrant
Certificate  or in  Section  1.4  in  an  exchange  or  transfer,  no  Warrant
Certificate  shall  be  issued  hereunder  in lieu of  such  canceled  Warrant
Certificate.  Any Warrant  Certificate  so canceled  shall be destroyed by the
Company.

                       WARRANT EXERCISE PRICE AND EXERCISE
                                   OF WARRANTS
Exercise Price.  Each Warrant  Certificate  shall, when signed by the Chairman
or President or any Executive  Vice President and attested to by the Secretary
or Assistant Secretary of the Company,  entitle the Holder thereof to purchase
from the Company,  subject to the terms and  conditions of this  Agreement and
the Warrant  Certificate,  the number of fully paid and nonassessable  Warrant
Shares  evidenced  thereby at an  Exercise  Price per share of Ninety US Cents
($0.90)  in the case of the Call  Warrant,  and One  Dollar  and  Seventy-Five
Cents  U.S.  (US$1.75)  in the  case of the  Advance  Warrants  (the  "Initial
Exercise  Price"),  or in either case,  such adjusted number of Warrant Shares
at such  adjusted  Exercise  Price  as may be  established  from  time to time
pursuant  to the  provisions  of  Article  III  hereof,  payable  in  full  in
accordance  with  Section 2.3 hereof,  at the time of exercise of the Warrant.
Except as the context  otherwise  requires,  the term "Exercise Price" as used
in this Agreement  shall mean the purchase price of one share of Common Stock,
reflecting all appropriate  adjustments made in accordance with the provisions
of Article III hereof.

Registration  of Warrants  and Warrant  Shares.  The Company  shall secure the
effective  registration  of the Warrant Shares for resale under the Securities
Act of 1933, as amended (the  "Securities  Act") upon the terms and subject to
the conditions set forth in the Registration  Rights Agreement executed by the
parties on the date hereof.  Promptly  after a  registration  statement  under
the  Securities  Act covering  the Warrant  Shares has become  effective,  the
Company  shall cause notice  thereof  together  with a copy of the  prospectus
covering the Warrant Shares to be mailed to each registered Holder.

Procedure  for Exercise of Warrants.  The Call Warrant may be exercised  for a
period of forty-five  (45) Business Days from the Effective Date as defined in
the  Securities  Purchase  Agreement.  The Advance  Warrants  may be exercised
prior to the Expiration  Date (as  hereinafter  defined) at the Exercise Price
at any time after the date of issuance.  The Advance  Warrants shall expire at
5:30 p.m.  (Eastern Time) on the Trading Day immediately  following the second
anniversary  of the date  the  Advance  Warrant  or  Warrants  are  issued  in
accordance with the Securities  Purchase  Agreement (the  "Expiration  Date").
The  Warrants  may be  exercised  by  surrendering  the  Warrant  Certificates
representing  such Warrants to the Company at its address set forth in Section
4.5  hereof,  together  with the  Election  to  Purchase  duly  completed  and
executed,  accompanied by payment in full, as set forth below,  to the Company
of the  Exercise  Price  for each  Warrant  Share  in  respect  of which  such
Warrants are being  exercised.  Such  Exercise  Price shall be paid in full by
cash or a  certified  check or a wire  transfer in same day funds in an amount
equal to the Exercise  Price  multiplied by the number of Warrant  Shares then
being purchased.

Issuance of Common Stock.  As soon as  practicable  after the Date of Exercise
of any  Warrants,  and in any  event no later  that  three (3)  Business  Days
thereafter  the  Company  shall,  if  possible,  electronically  settle into a
brokerage account  designated by the Purchaser or, if not possible,  issue, or
cause its transfer  agent to issue,  a  certificate  or  certificates  for the
number of full Warrant Shares,  registered in accordance with the instructions
set forth in the  Election  to  Purchase,  together  with cash for  fractional
shares as  provided  in Section  3.10.  All  Warrant  Shares  issued  upon the
exercise of any Warrants shall be validly  authorized and issued,  fully paid,
non-assessable,  free of preemptive rights and (subject to Section 4.1 hereof)
free from all taxes,  liens,  charges and security interests in respect of the
issuance  thereof.  Each person in whose name any such certificate for Warrant
Shares is issued  shall be deemed for all  purposes  to have become the holder
of record of the Common Stock  represented  thereby on the Date of Exercise of
the Warrants  resulting in the  issuance of such shares,  irrespective  of the
date of issuance or delivery of such certificate for Warrant Shares.

Certificates  for  Unexercised  Warrants.  In the  event  that,  prior  to the
Expiration  Date, a Warrant  Certificate is exercised in respect of fewer than
all  of  the  Warrant  Shares  issuable  on  such  exercise,   a  new  Warrant
Certificate  representing  the  remaining  Warrant  Shares shall be issued and
delivered pursuant to the provisions  hereof;  provided that the Company shall
not be required to issue any Warrant  Certificate  representing any fractional
Warrant Shares.

Reservation  of  Shares.  The  Company  shall at all  times  reserve  and keep
available,  free from  preemptive  rights,  for issuance  upon the exercise of
Warrants,  the maximum number of its authorized but unissued  shares of Common
Stock which may then be issuable upon the exercise in full of all  outstanding
Warrants.  The  Company  shall from time to time take all action  which may be
necessary or appropriate so that the Warrant  Shares,  immediately  upon their
issuance  following an exercise of Warrants,  will be listed or quoted, as the
case may be, on the  principal  securities  exchanges  or  markets  within the
United  States of America,  if any, on which other  shares of the Common Stock
are then listed.  Without  limitation  of Section 2.2 hereof,  nothing in this
Section  2.6 shall  require  the  Company to  maintain a current  registration
statement or prospectus for the Warrant Shares.

No  Impairment.  The  Company  shall  not by any  action,  including,  without
limitation,   amending  its  certificate  of   incorporation  or  through  any
reorganization,  transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other  voluntary  action,  avoid or seek to avoid
the observance or  performance  of any of the terms of the Warrants,  but will
at all times in good faith  assist in the  carrying  out of all such terms and
in the  taking of all such  actions  as may be  necessary  or  appropriate  to
protect the rights of the Holders  against  impairment.  Without  limiting the
generality of the  foregoing,  the Company will (a) not increase the par value
of any Warrant Shares  receivable  upon the exercise of the Warrants above the
amount payable therefor upon such exercise  immediately prior to such increase
in par value,  (b) take all such action as may be necessary or  appropriate in
order  that  the  Company  may  validly  and  legally  issue  fully  paid  and
non-assessable  Warrant  Shares upon the exercise of any Warrant,  and (c) use
its best  efforts to obtain all such  authorizations,  exemptions  or consents
from  any  public  regulatory  body  having  jurisdiction  thereof  as  may be
necessary  to  enable  the  Company  to  perform  its  obligations  under  the
Warrants.  Notwithstanding the foregoing  paragraph,  the Company shall not be
required  to issue  Warrant  Shares  upon the  exercise of any Warrant if such
issuance would result in a violation by the Company of any applicable law.

                        ADJUSTMENTS AND NOTICE PROVISIONS
Adjustment  of  Exercise  Price.  The  Exercise  Price and  number of  Warrant
Shares  issuable upon exercise of the Warrants are subject to adjustment  from
time to time as set forth in this Section 3.1.  Upon each such  adjustment  of
the Exercise Price  pursuant to this Section 3.1, the Holder shall  thereafter
prior to the  Expiration  Date be entitled to purchase,  at the Exercise Price
resulting  from such  adjustment,  the number of Warrant  Shares  obtained  by
multiplying the Exercise Price in effect  immediately prior to such adjustment
by the  number of  Warrant  Shares  issuable  upon  exercise  of the  Warrants
immediately  prior to such  adjustment and dividing the product thereof by the
Exercise Price resulting from such adjustment.

  If the Company, at any time while the Warrants is outstanding, (i) shall pay
   a stock dividend (except scheduled dividends paid on outstanding preferred
      stock as of the date hereof which contain a stated dividend rate) or
  otherwise make a distribution or distributions on shares of its Common Stock
   or on any other class of capital stock and not the Common Stock) payable in
   shares of Common Stock, (ii) subdivide or reclassify outstanding shares of
   Common Stock into a larger number of shares, or (iii) combine or reclassify
     outstanding shares of Common Stock into a smaller number of shares, the
     Exercise Price in effect after the event shall be the Exercise Price in
     effect immediately prior thereto multiplied by a fraction of which the
   numerator shall be the number of shares of Common Stock (excluding treasury
   shares, if any) outstanding before such event and the denominator shall be
    the number of shares of Common Stock (excluding treasury shares, if any)
   outstanding after such event. Any adjustment made pursuant to this Section
        shall become effective immediately after the record date for the
       determination of stockholders entitled to receive such dividend or
  distribution and shall become effective immediately after the effective date
   in the case of a subdivision or combination, and shall apply to successive
                         subdivisions and combinations.
    In case of any reclassification of the Common Stock, any consolidation or
   merger of the Company with or into another person, the sale or transfer of
 all or substantially all of the assets of the Company or any compulsory share
       exchange pursuant to which the Common Stock is converted into other
       securities, cash or property, then the Holder shall have the right
  thereafter, prior to the Expiration Date, to exercise the Warrants only into
    the shares of stock and other securities and property receivable upon or
 deemed to be held by holders of Common Stock following such reclassification,
 consolidation, merger, sale, transfer or share exchange, and the Holder shall
  be entitled upon such event to receive such amount of securities or property
     equal to the amount thereof that would have been paid or distributed in
 respect of the Warrant Shares such Holder would have received had such Holder
       exercised the Warrants immediately prior to such reclassification,
    consolidation, merger, sale, transfer or share exchange. The terms of any
   such consolidation, merger, sale, transfer or share exchange shall include
   such terms so as to continue to give to the Holder the right to receive the
     securities or property set forth in this Section 3.1 upon any exercise
 following any such reclassification, consolidation, merger, sale, transfer or
                                 share exchange.
    For the purposes of this Section 3.1, the following clauses shall also be
                                   applicable:
   Record Date. In case the Company shall take a record of the holders of its
    Common Stock for the purpose of entitling them (A) to receive dividend or
   other distribution payable in Common Stock or in securities convertible or
 exchangeable into shares of Common Stock, or (B) to subscribe for or purchase
  Common Stock or securities convertible or exchangeable into shares of Common
   Stock, then such record date shall be deemed to be the date of the issue or
   sale of the shares of Common Stock deemed to have been issued or sold upon
  the declaration of such dividend or the making of such other distribution or
   the date of the granting of such right of subscription or purchase, as the
                                  case may be.
    Treasury Shares. The number of shares of Common Stock outstanding at any
   given time shall not include shares owned or held by or for the account of
   the Company, and the disposition of any such shares shall be considered an
                         issue or sale of Common Stock.
  All calculations under this Section 3.1 shall be made to the nearest cent or
               the nearest 1/100th of a share, as the case may be.
                                       If:
     the Company shall declare a dividend (or any other distribution) on its
                                Common Stock; or
     the Company shall declare a special nonrecurring cash dividend on or a
                       redemption of its Common Stock; or
   the Company shall authorize the granting to all holders of the Common Stock
   rights or warrants to subscribe for or purchase any shares of capital stock
                        of any class or of any rights; or
      the approval of any stockholders of the Company shall be required in
  connection with any reclassification of the Common Stock of the Company, any
 consolidation or merger to which the Company is a party, any sale or transfer
   of all or substantially all of the assets of the Company, or any compulsory
   share exchange whereby the Common Stock is converted into other securities,
                              cash or property; or
 the Company shall authorize the voluntary dissolution, liquidation or winding
                        up of the affairs of the Company,
     then the Company shall cause to be mailed to each Holder at their last
addresses  as they  shall  appear  upon  the  Warrant  Register,  at  least 30
calendar days prior to the  applicable  record or effective  date  hereinafter
specified,  a notice stating (x) the date on which a record is to be taken for
the purpose of such dividend,  distribution,  redemption,  rights or warrants,
or if a record is not to be taken,  the date as of which the holders of Common
Stock of record to be entitled to such  dividend,  distributions,  redemption,
rights  or  warrants  are to be  determined  or (y)  the  date on  which  such
reclassification,  consolidation,  merger, sale, transfer or share exchange is
expected  to  become  effective  or  close,  and the  date as of  which  it is
expected  that holders of Common Stock of record shall be entitled to exchange
their  shares  of  Common  Stock  for  securities,   cash  or  other  property
deliverable  upon  such   reclassification,   consolidation,   merger,   sale,
transfer,  share exchange,  dissolution,  liquidation or winding up; provided,
however,  that the failure to mail such notice or any defect therein or in the
mailing  thereof  shall  not  affect  the  validity  of the  corporate  action
required to be specified in such notice.

Certificate  of  Adjustments.  Whenever any  adjustment is to be made pursuant
to this Article III, the Company shall  prepare a certificate  executed by the
Chief Financial  Officer of the Company,  setting forth such adjustments to be
mailed to each Holder at least  fifteen (15) days prior  thereto,  such notice
to include in reasonable  detail (a) the events  precipitating the adjustment,
(b) the  computation  of any  adjustments,  and (c) the Exercise Price and the
number  of  shares  or the  securities  or  other  property  purchasable  upon
exercise of each Warrant after giving effect to such adjustment.

Warrant Certificate  Amendments.  Irrespective of any adjustments  pursuant to
this Article III, Warrant  Certificates  theretofore or thereafter issued need
not be amended or replaced,  but certificates  thereafter issued shall bear an
appropriate  legend or other notice of any  adjustments;  provided the Company
may, at its  option,  issue new Warrant  Certificates  evidencing  Warrants in
such  form as may be  approved  by its  Board  of  Directors  to  reflect  any
adjustment  in the  Exercise  Price and number of Warrant  Shares  purchasable
under the Warrants.

Fractional  Shares.  The Company  shall not be required  upon the  exercise of
any  Warrant  to  issue  fractional  Warrant  Shares  which  may  result  from
adjustments  in  accordance  with this  Article III to the  Exercise  Price or
number of Warrant  Shares  purchasable  under each  Warrant.  If more than one
Warrant  is  exercised  at one time by the same  Holder,  the  number  of full
Warrant  Shares  which shall be issuable  upon the exercise  thereof  shall be
computed  based on the aggregate  number of Warrant  Shares  purchasable  upon
exercise  of such  Warrants.  With  respect to any final  fraction  of a share
called for upon the  exercise of any Warrant or  Warrants,  the Company  shall
pay an amount in cash to the Holder of the  Warrants  in respect of such final
fraction  in an  amount  equal to the Fair  Market  Value of a share of Common
Stock  as of the  Date  of  Exercise  of  such  Warrants,  multiplied  by such
fraction.  All  calculations  under  this  Section  3.4  shall  be made to the
nearest hundredth of a share.

            As used herein:  (a) the term "Fair Market  Value," on a per share
basis, means the average of the daily Closing Prices (as hereinafter  defined)
of the Common Stock for the five (5) consecutive  Trading Days (as hereinafter
defined)  ending the Trading Day  immediately  preceding the Date of Exercise;
(b) the term "Date of Exercise"  with respect to any Warrant means the date on
which such  Warrant is  exercised as provided  herein;  (c) the term  "Closing
Price"  for any date  shall  mean the last sale  price  reported  in The Wall
Street  Journal  regular way or, in case no such  reported sale takes place on
such date,  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 if that is the principal  market
for the Common  Stock or, if not listed or admitted to trading on any national
securities  exchange  or if  such  national  securities  exchange  is not  the
principal  market for the Common Stock, the last sale price as reported on The
Nasdaq Stock Market,  Inc.'s National Market  ("Nasdaq") or its successor,  if
any, or if the Common  Stock is not so  reported,  the average of the reported
bid and asked  prices in the  over-the-counter  market,  as  furnished  by the
National  Quotation  Bureau,  Inc., or if such firm is not then engaged in the
business of  reporting  such  prices,  as  furnished  by any similar firm then
engaged in such  business  and selected by the Company or, if there is no such
firm,  as furnished by any member of the National  Association  of  Securities
Dealers,  Inc. ("NASD") selected by the Company or, if the Common Stock is not
quoted in the  over-the-counter  market,  the fair value thereof determined in
good faith by the  Company's  Board of  Directors as of a date which is within
15 days of the date as of which the  determination  is to be made; and (d) the
term  "Trading  Days" with respect to the Common Stock means (i) if the Common
Stock is quoted on Nasdaq or any similar system of automated  dissemination of
quotations  of  securities  prices,  days on which  trades may be made on such
system or (ii) if the Common  Stock is listed or  admitted  for trading on any
national securities exchange,  days on which such national securities exchange
is open for business.

IV      MISCELLANEOUS

      Section  4.1  Payment of Taxes and  Charges.  The  Company  will pay all
taxes (other than income  taxes) and other  government  charges in  connection
with the  issuance  or delivery of the  Warrants  and the initial  issuance or
delivery of Warrant  Shares upon the  exercise of any  Warrants and payment of
the Exercise  Price.  The Company shall not,  however,  be required to pay any
additional  transfer  taxes in  connection  with the  subsequent  transfer  of
Warrants or any  transfer  involved in the  issuance  and  delivery of Warrant
Shares in a name  other  than the name in which  the  Warrants  to which  such
issuance  relates  were  registered,  and, if any such tax would  otherwise be
payable by the Company,  no such issuance or delivery shall be made unless and
until the person  requesting  such issuance has paid to the Company the amount
of any such tax, or it is established to the  reasonable  satisfaction  of the
Company that any such tax has been paid.

      Section 4.2.Changes to Agreement.  The Company,  when  authorized by its
Board of  Directors,  with the written  consent of Purchaser for so long as it
holds any  Warrants or , if none,  then  Holders of at least a majority of the
outstanding  Warrants  may amend or  supplement  this  Agreement.  The Company
may,  without  the  consent or  concurrence  of any  Holder,  by  supplemental
agreement or  otherwise,  make any changes or  corrections  in this  Agreement
that the Company  shall have been  advised by counsel (a) are required to cure
any  ambiguity  or to correct  any  defective  or  inconsistent  provision  or
clerical  omission or mistake or manifest error herein  contained,  (b) add to
the covenants and  agreements  of the Company in this  Agreement  such further
covenants  and  agreements  thereafter  to be  observed,  or (c) result in the
surrender of any right or power  reserved to or conferred  upon the Company in
this Agreement,  in each case which changes or corrections do not and will not
adversely affect, alter or change the rights,  privileges or immunities of the
Holders.

      Section 4.3.Assignment.   All  the  covenants  and  provisions  of  this
Agreement  by or for the benefit of the Company or the Holders  shall bind and
inure to the benefit of their respective successors and permitted assigns.

      Section 4.4.Successor to Company.  In the event that the Company  merges
or  consolidates  with or into  any  other  corporation  or sell or  otherwise
transfers its property,  assets and business substantially as an entirety to a
successor corporation,  the Company shall use reasonable commercial efforts to
have such successor  corporation  assume each and every covenant and condition
of this Agreement to be performed and observed by the Company.

      Section 4.5.Notices.  Any notice or demand  required  by this  Agreement
to be given or made by any Holder to or on the Company  shall be  sufficiently
given or made if sent by  first-class  or registered  mail,  postage  prepaid,
addressed as follows:

                              Medix Resources, Inc.
                              7100 E. Belleview Avenue
                              Suite 301
                              Greenwood Village, Colorado  80111

                              Attn: John R. Prufeta
                              Tel: (303) 741-2045
                              Fax: (303) 850-9519

                        With a copy to:

                              Lyle Stewart
                              3751 South Quebec Street
                              Denver, Colorado  80237

                              Tel: (303) 267-0920
                              Fax: (303) 267-0922

Any notice or demand  required  by this  Agreement  to be given or made by the
Company to or on any  Holder  shall be  sufficiently  given or made if sent by
first-class or registered mail, postage prepaid,  addressed to such Holder and
sent to the following address:

                              ROYCAP INC.
                              4100 Yonge Street
                              Suite 504
                              Toronto, Ontario M2P 2G2
                              Canada

                              Attn: Steven Rider
                              Tel: (416) 266-9921
                              Fax: (416) 221-1253

                        With a copy to:

                              Fogler, Rubinoff LLP
                              Suite 4400, Royal Trust Tower
                              Toronto Dominion Centre
                              Toronto, Ontario M5K 1G8

                              Attn:  Michael Slan
                              Tel: (416) 941-8857
                              Fax: (416) 941-8852

Any notice or demand  required  by this  Agreement  to be given or made by the
Company to or on any Holder shall be  sufficiently  given or made,  whether or
not such holder receives the notice,  five (5) days after mailing,  if sent by
first-class or registered mail,  postage prepaid,  addressed to such Holder at
its last  address  as  shown on the  books  of the  Company.  Otherwise,  such
notice or demand  shall be deemed  given when  received by the party  entitled
thereto.

      Section 4.6.Defects  in  Notice.  Failure  to file  any  certificate  or
notice  or to mail any  notice,  or any  defect in any  certificate  or notice
pursuant  to this  Agreement  shall not  affect  in any way the  rights of any
Holder or the legality or validity of any adjustment  made pursuant to Section
3.1, or any transaction  giving rise to any such  adjustment,  or the legality
or validity of any action taken or to be taken by the Company.

      Section 4.7.Governing Law.  The corporate laws of the State of Colorado
shall govern all issues concerning the relative rights of the Company and its
stockholders.  All other questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of  New York,
without regard to the principles of conflicts of law thereof.  The Company
and the Purchaser hereby irrevocably submit to the jurisdiction of either the
Province of Ontario or the State of New York, as determined by the party
initiating any proceeding, for the adjudication of any dispute hereunder or
in connection herewith or with any transaction contemplated hereby or
discussed herein, and hereby irrevocably waives, and agrees not to assert in
any suit, action or proceeding, any claim that it is not personally subject
to the jurisdiction of any such court, or that such suit, action or
proceeding is improper.  Each of the Company and the Purchaser hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by receiving a copy thereof
sent to the Company at the address in effect for notices to it under this
instrument and agrees that such service shall constitute good and sufficient
service of process and notice thereof.  Nothing contained herein shall be
deemed to limit in any way any right to serve process in any manner permitted
by law.

      Section 4.8.Standing.  Nothing in this  Agreement  expressed and nothing
that may be implied from any of the  provisions  hereof is intended,  or shall
be  construed,  to confer upon,  or give to, any person or  corporation  other
than the  Company  and the  Holders of any right,  remedy or claim under or by
reason of this Agreement or of any covenant, condition,  stipulation,  promise
or agreement  contained herein; and all covenants,  conditions,  stipulations,
promises and agreements  contained in this Agreement shall be for the sole and
exclusive benefit of the Company and its successors, and the Holders.

      Section 4.9.Headings.  The  descriptive  headings  of the  articles  and
sections of this  Agreement  are inserted for  convenience  only and shall not
control or affect the meaning or construction of any of the provisions hereof.

      Section 4.10      Execution.  This  Agreement  may be executed in two or
more  counterparts,  all of which when taken  together shall be considered one
and the same agreement and shall become effective when  counterparts have been
signed by each party and  delivered  to the other party,  it being  understood
that both  parties need not sign the same  counterpart.  In the event that any
signature is delivered by facsimile transmission,  such signature shall create
a valid and binding  obligation  of the party  executing  (or on whose  behalf
such  signature  is  executed)  the same with the same  force and effect as if
such facsimile signature page were an original thereof.

      Section 4.11      Availability  of  the  Agreement.  The  Company  shall
keep copies of this  Agreement  available  for  inspection  by Holders  during
normal business  hours.  Copies of this Agreement may be obtained upon written
request  addressed  to the  Company at the  address  set forth in Section  4.5
hereof.

      Section 4.12      Entire  Agreement.   This  Agreement,   including  the
Exhibits  referred to herein and the other  writings  specifically  identified
herein or contemplated  hereby, is complete,  reflects the entire agreement of
the parties with respect to its subject  matter,  and  supersedes all previous
written or oral negotiations, commitments and writings.

                    WARRANT AGREEMENT COMPANY SIGNATURE PAGE

            IN WITNESS WHEREOF,  this Warrant Agreement has been duly executed
by the parties as of the day and year first above written.

                                    MEDIX RESOURCES, INC.,
                                    a Colorado corporation

                                    By:   /s/Gary L. Smith
                                    Name:  Gary L. Smith
                                    Title: Executive Vice-President &
                                    Chief Financial Officer

                   WARRANT AGREEMENT PURCHASER SIGNATURE PAGE

Accepted and Agreed as of the date first written above.

                                    ROYCAP INC., an Ontario corporation

                                    By: /s/Steven Rider
            ......                  Name: Steven Rider

                                    Title: President and CEO

                                                Exhibit A to Warrant Agreement
NEITHER THESE  SECURITIES NOR THE SECURITIES  INTO WHICH THESE  SECURITIES ARE
EXERCISABLE  HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE  COMMISSION
OR THE  SECURITIES  COMMISSION  OF ANY STATE OR PROVINCE  IN RELIANCE  UPON AN
EXEMPTION  FROM  REGISTRATION  UNDER  SECURITIES  ACT OF 1933, AS AMENDED (THE
"SECURITIES  ACT"),  AND,  ACCORDINGLY,  MAY NOT BE  OFFERED  OR  SOLD  EXCEPT
PURSUANT TO AN EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE SECURITIES ACT OR
PURSUANT  TO  AN  AVAILABLE  EXEMPTION  FROM  THE  REGISTRATION   REQUIREMENTS
THEREUNDER  AND IN COMPLIANCE  WITH  APPLICABLE  STATE  SECURITIES OR BLUE SKY
LAWS.

                              MEDIX RESOURCES, INC.

                          Common Stock Purchase Warrant

Warrant No. 001-2001                                   Dated: January 10, 2001

            Medix  Resources,  Inc., a Colorado  corporation  (the "Company"),
hereby   certifies  that,  for  value   received,   RoyCap  Inc.,  an  Ontario
corporation or its registered assigns (the "Holder"), is entitled,  subject to
the terms and conditions set forth herein,  to purchase from the Company up to
a total of  500,000  shares of common  stock,  $0.001 par value per share (the
"Common  Stock"),  of the Company (each such share, a "Warrant  Share" and all
such shares,  the "Warrant  Shares") in multiples of one hundred  (100) shares
of Common Stock, subject to the terms and conditions set forth herein.  Unless
otherwise  specified,  capitalized  terms used herein are defined in Exhibit A
attached hereto. This Warrant is governed by the Warrant Agreement.

     Registration of Warrant. The Company shall register this Warrant in the
            manner set forth in Section 1.3 of the Warrant Agreement.
                    Registration of Transfers and Exchanges.
   This Warrant may only be transferred pursuant to an effective registration
      statement under the Securities Act, to the Company or pursuant to an
  available exemption from or in a transaction not subject to the registration
   requirements of the Securities Act. In connection with any transfer of this
  Warrant other than pursuant to an effective registration statement or to the
    Company, the Company may require the transferor thereof to provide to the
     Company an opinion of counsel selected by the transferor, the form and
   substance of which opinion shall be reasonably satisfactory to the Company,
     to the effect that such transfer does not require registration of such
 Warrant under the Securities Act. Holder agrees to the imprinting, so long as
   is required by this Section 2(a), of a legend substantially similar to that
       first above written on any New Warrant (as defined below). Any such
   transferee shall agree in writing to be bound by the terms of this Warrant
    and shall have the rights of Holder under this Warrant. The Company shall
    register the transfer of any portion of this Warrant in the records to be
    maintained by the Company for that purpose (the "Warrant Register"), upon
   surrender of this Warrant, with the Form of Assignment attached hereto duly
   completed and signed to the Company at its address for notice set forth in
      Section 10. Upon any such registration or transfer, a new warrant to
   purchase Common Stock, in substantially the form of this Warrant (any such
    new warrant, a "New Warrant"), evidencing the portion of this Warrant so
   transferred shall be issued to the transferee and a New Warrant evidencing
   the remaining portion of this Warrant not so transferred, if any, shall be
   issued to the transferring Holder. The acceptance of the New Warrant by the
   transferee thereof shall be deemed the acceptance of such transferee of all
             of the rights and obligations of a holder of a Warrant.
  This Warrant is exchangeable, upon the surrender hereof by the Holder to the
 Company at its address for notice set forth in Section 10 for one or more New
    Warrants, evidencing in the aggregate the right to purchase the number of
   Warrant Shares which may then be purchased hereunder. Any such New Warrant
                    will be dated the date of such exchange.
                 Duration, Exercise and Redemption of Warrants.
                                                           Exercise By Holder.
(1)   At any time on and  after  the  Effective  Date and  prior to 5:30  p.m.
(Eastern time) on the Trading Day immediately  following January 10, 2003 (the
second year  anniversary of the Drawdown Date) (the  "Expiration  Date"),  the
Holder  shall be entitled to purchase  all or a portion of the Warrant  Shares
which have not been  previously  issued and with respect to which this Warrant
has not been  previously  redeemed or canceled  in  accordance  with the terms
hereof;  subject to the restrictions set forth herein. A "Drawdown Date" means
the  date on  which  the  Holder  makes an  advance  of  funds to the  Company
pursuant to the provisions of the Convertible Note.

(2)   The Holder may purchase  Warrant  Shares  hereunder by delivering to the
Company,  at its address for notice set forth in Section 10, a completed  Form
of  Election  to  Purchase  in the form  attached  hereto,  together  with the
payment of the  Exercise  Price  multiplied  by the  number of Warrant  Shares
indicated  therein.  An "Exercise  Date" means the date of the delivery (which
may be made via  facsimile) of the Form of Election to Purchase and applicable
Exercise Price.

(3)   No later than the third Trading Day  following  delivery of each Form of
Election to Purchase and the  applicable  Exercise  Price,  the Company  shall
promptly  issue or cause to be issued and cause to be delivered to or upon the
written  order of the  Holder  and in such  name or names  as the  Holder  may
designate,  a certificate  for the Warrant Shares issuable upon such exercise,
free of restrictive legends except as required by the Purchase Agreement.

i)    If the  Company  fails to  deliver  to the  Holder  the  certificate  or
certificates  pursuant to this Section  within the time specified  above,  the
Holder  shall be entitled  by written  notice to the Company at any time on or
before its receipt of such certificate or certificates thereafter,  to rescind
such exercise.

ii)   In addition to the rights set forth in (A) above,  if the Company  fails
to deliver to the Holder such  certificate  or  certificates  pursuant to this
Section  within the time  specified  above,  and if after such time the Holder
purchases  (in an open  market  transaction  or  otherwise)  Common  Stock  to
deliver in  satisfaction  of a sale by such Holder of the Warrant Shares which
the Holder  anticipated  receiving  upon such exercise (a "Buy-In"),  then the
Company  shall  (1) pay in cash to the  Holder  the  amount  by which  (x) the
Holder's total purchase price (including  brokerage  commissions,  if any) for
the Common  Stock so  purchased  exceeds (y) the product of (i) the  aggregate
number of Warrant  Shares  that such  Holder  anticipated  receiving  from the
exercise at issue  multiplied  by (ii) the volume  weighted  average Per Share
Market Value on the Exercise Date and (2) at the option of the Holder,  either
rescind  the  exercise at issue or deliver to the Holder the number of Warrant
Shares that would have been issued had the Company  timely  complied  with its
delivery   requirements  under  this  Section.  For  example,  if  the  Holder
purchases  Common  Stock having a total  purchase  price of $11,000 to cover a
Buy-In with respect to an attempted  exercise with respect to which the volume
weighted  average Per Share Market  Value on the Exercise  Date was a total of
$10,000,  the Company shall be required to pay the Holder  $1,000.  The Holder
shall provide the Company  written notice  indicating  the amounts  payable to
the Holder in respect of the Buy-In.

                                                               Exercise Price.
            The  "Exercise  Price"  applicable  to  an  exercise  pursuant  to
Section  3(a)  shall  equal One Dollar  and  Seventy  Five Cents US (US $1.75)
(subject  to  equitable   adjustment   for  stock  splits,   reverse   splits,
combinations and other similar events in accordance with Section 7 hereof).

       Payment of Taxes. The Company will pay all documentary stamp taxes
    attributable to the issuance of Warrant Shares upon the exercise of this
 Warrant; provided, however, that the Company shall not be required to pay any
       tax which may be payable in respect of any transfer involved in the
    registration of any certificates for Warrant Shares or Warrants in a name
  other than that of the Holder. The Holder shall be responsible for all other
    tax liability that may arise as a result of holding or transferring this
            Warrant or receiving Warrant Shares upon exercise hereof.
   Replacement of Warrant. If this Warrant shall be mutilated, lost, stolen or
    destroyed, the Company shall issue, execute and deliver, in exchange and
  substitution for and upon cancellation of a mutilated Warrant, or in lieu of
    or in substitution for a lost, stolen or destroyed Warrant, a New Warrant
  representing an equivalent number of Warrants or Warrant Shares. If required
   by the Company, the Holder must provide indemnity sufficient to protect the
    Company from any loss which it may suffer if the Warrant is replaced. Any
   such New Warrant shall constitute an original contractual obligation of the
   Company, whether or not the allegedly lost, stolen, mutilated or destroyed
               Warrant shall be at any time enforceable by anyone.
    Reservation of Warrant Shares. The Company covenants that it will at all
   times reserve and keep available out of the aggregate of its authorized but
 unissued Common Stock, solely for the purpose of enabling it to issue Warrant
     Shares upon exercise of this Warrant as herein provided, the number of
   Warrant Shares which are then issuable and deliverable upon the exercise of
      this entire Warrant, free from preemptive rights or any other actual
    contingent purchase rights of persons other than the Holder (taking into
 account the adjustments and restrictions of Section 7). The Company covenants
 that all Warrant Shares that shall be so issuable and deliverable shall, upon
  issuance and the payment of the applicable Exercise Price in accordance with
   the terms hereof, be duly and validly authorized, issued and fully paid and
                                 nonassessable.
      Certain Adjustments. The Exercise Price and number of Warrant Shares
  issuable upon exercise of this Warrant is subject to adjustment from time to
           time as set forth in Article III of the Warrant Agreement.
     Payment of Exercise Price. The Holder shall pay the Exercise Price for
 Warrant Shares purchased hereunder by delivery of immediately available funds
                     unless otherwise agreed by the Company.
  Fractional Shares. The Company shall not be required to issue or cause to be
  issued fractional Warrant Shares on the exercise of this Warrant. The number
    of full Warrant Shares which shall be issuable upon the exercise of this
    Warrant shall be computed on the basis of the aggregate number of Warrant
  Shares purchasable on exercise of this Warrant so presented. If any fraction
     of a Warrant Share would, except for the provisions of this Section, be
  issuable on the exercise of this Warrant, the Company shall pay an amount in
          cash equal to the Exercise Price multiplied by such fraction.
  Notices. Any and all notices or other communications or deliveries hereunder
   shall be in writing and shall be deemed given and effective on the earliest
 of (i) the date of transmission, if such notice or communication is delivered
    via facsimile at the facsimile telephone number specified in this Section
    prior to 8:00 p.m. (Denver time) on a business day, (ii) the business day
  after the date of transmission, if such notice or communication is delivered
    via facsimile at the facsimile telephone number specified in this Section
    later than 8:00 p.m (Denver time) on any date and earlier than 11:59 p.m.
    (Denver time) on such date, (iii) the business day following the date of
  mailing, if sent by nationally recognized overnight courier service, or (iv)
    if sent other than by the methods set forth in (i)-(iii) of this section,
     upon actual receipt by the party to whom such notice is required to be
      given. The addresses for such communications shall be: (i) if to the
    Company, to 7100 Belleview Ave., Suite 301, Greenwood Village, Colorado,
    80111, Attention: John R. Prufeta, or to Facsimile No. (303) 850-9519, or
     (ii) if to the Holder, to the Holder at the address or facsimile number
   appearing on the Warrant Register or such other address or facsimile number
    as the Holder may provide to the Company in accordance with this Section.
   Warrant Agent. The Company shall serve as warrant agent under this Warrant.
   Upon thirty (30) days' notice to the Holder, the Company may appoint a new
    warrant agent. Any corporation into which the Company or any new warrant
   agent may be merged or any corporation resulting from any consolidation to
       which the Company or any new warrant agent shall be a party or any
       corporation to which the Company or any new warrant agent transfers
   substantially all of its corporate trust or shareholders services business
    shall be a successor warrant agent under this Warrant without any further
    act. Any such successor warrant agent shall promptly cause notice of its
     succession as warrant agent to be mailed (by first class mail, postage
   prepaid) to the Holder at the Holder's last address as shown on the Warrant
                                    Register.
                                 Miscellaneous.
    This Warrant shall be binding on and inure to the benefit of the parties
     hereto and their respective successors and assigns. This Warrant may be
     amended only in writing signed by the Company and the Holder and their
                        successors and permitted assigns.
   Subject to Section 12(a), above, nothing in this Warrant shall be construed
   to give to any person or corporation other than the Company and the Holder
     any legal or equitable right, remedy or cause under this Warrant. This
  Warrant shall inure to the sole and exclusive benefit of the Company and the
                                     Holder.
       The corporate laws of the State of Colorado shall govern all issues
     concerning the relative rights of the Company and its stockholders. All
     other questions concerning the construction, validity, enforcement and
      interpretation of this Warrant shall be governed by and construed and
     enforced in accordance with the laws of the State of New York, without
    regard to the principles of conflicts of law thereof. The Company and the
  Holder hereby irrevocably submit to the jurisdictions of either the Province
 of Ontario or in the State of New York, as determined by the party initiating
       any proceeding, for the adjudication of any dispute hereunder or in
  connection herewith or with any transaction contemplated hereby or discussed
  herein, and hereby irrevocably waives, and agrees not to assert in any suit,
    action or proceeding, any claim that it is not personally subject to the
   jurisdiction of any such court, or that such suit, action or proceeding is
     improper. Each of the Company and the Holder hereby irrevocably waives
  personal service of process and consents to process being served in any such
 suit, action or proceeding by receiving a copy thereof sent to the Company at
 the address in effect for notices to it under this instrument and agrees that
    such service shall constitute good and sufficient service of process and
  notice thereof. Nothing contained herein shall be deemed to limit in any way
           any right to serve process in any manner permitted by law.
    The headings herein are for convenience only, do not constitute a part of
 this Warrant and shall not be deemed to limit or affect any of the provisions
                                     hereof.
 In case any one or more of the provisions of this Warrant shall be invalid or
      unenforceable in any respect, the validity and enforceability of the
     remaining terms and provisions of this Warrant shall not in any way be
   affected or impaired thereby and the parties will attempt in good faith to
   agree upon a valid and enforceable provision which shall be a commercially
  reasonable substitute therefor, and upon so agreeing, shall incorporate such
                      substitute provision in this Warrant.

            IN WITNESS  WHEREOF,  the Company  has caused  this  Warrant to be
duly executed by its authorized officer as of the date first indicated above.

                                         MEDIX RESOURCES, INC.

                                         By: _______________________
                                         Name:  Gary L. Smith
                                         Title: Executive Vice-President and
                                                Chief Financial Officer

                          FORM OF ELECTION TO PURCHASE

(To be  executed by the Holder to  exercise  the right to  purchase  shares of
Common Stock under the foregoing Warrant)

To Medix Resources, Inc.:

            In  accordance  with  the  Warrant  enclosed  with  this  Form  of
Election to Purchase,  the undersigned  hereby  irrevocably elects to purchase
_____________  shares of common  stock,  $.001 par value per  share,  of Medix
Resources,  Inc. (the "Common Stock") and encloses herewith  $________ in cash
by wire transfer,  or by certified or official bank check or checks, which sum
represents  the aggregate  Exercise  Price (as defined in the Warrant) for the
number of shares of Common  Stock to which this Form of  Election  to Purchase
relates,  together  with  any  applicable  taxes  payable  by the  undersigned
pursuant to the Warrant.

            The  undersigned  requests  that  certificates  for the  shares of
Common Stock issuable upon this exercise be issued in the name of

PLEASE INSERT SOCIAL SECURITY OR TAX IDENTIFICATION NUMBER

------------------------------------------------------------------------------

------------------------------------------------------------------------------
                       (Please print name and address)

            If the  number  of  shares  of  Common  Stock  issuable  upon this
exercise shall not be all of the shares of Common Stock which the  undersigned
is  entitled  to  purchase  in  accordance  with  the  enclosed  Warrant,  the
undersigned   requests  that  a  New  Warrant  (as  defined  in  the  Warrant)
evidencing  the right to  purchase  the  shares of Common  Stock not  issuable
pursuant  to the  exercise  evidenced  hereby  be  issued  in the  name of and
delivered to:

------------------------------------------------------------------------------
                       (Please print name and address)
------------------------------------------------------------------------------

------------------------------------------------------------------------------

------------------------------------------------------------------------------

Dated:  _____, _____                     Name of Holder:

(Print)________________________________________________________________________

(By:) _________________________________________________________________________
(Name:)
(Title:)
                                         (Signature must conform in all
                                         respects to name of holder as
                                         specified on the face of the Warrant)

                               FORM OF ASSIGNMENT

          [To be completed and signed only upon transfer of Warrant]

            FOR VALUE  RECEIVED,  the  undersigned  hereby sells,  assigns and
transfers unto  ________________________________  the right represented by the
within  Warrant  to  purchase  ____________  shares of  Common  Stock of Medix
Resources,   Inc.  to  which  the  within   Warrant   relates   and   appoints
________________  attorney  to  transfer  said  right  on the  books  of Medix
Resources, Inc. with full power of substitution in the premises.

Dated:
---------------, ----------

                                         -----------------------------------
                                         (Signature must conform in all
                                         respects to name of holder as
                                         specified on the face of the Warrant)

                                         -----------------------------------
                                         Address of Transferee
                                         ===================================

In the presence of:

-----------------------------------------

                                    Exhibit A

1.   "Business  Day"  means any day  except  Saturday,  Sunday and any day which
     shall be a federal legal holiday or a day on which banking  institutions in
     the  State  of  Colorado  are  authorized  or  required  by  law  or  other
     governmental action to close.

2.   "Commission" means the Securities and Exchange Commission.

3.   "Convertible  Note"  means the  Convertible  Note dated  December  29, 2000
     issued by the Company in favour of the Holder which  permits the Company to
     draw up to two million five hundred thousand US Dollars (US$2,500,000).

4.   "Effective  Date"  means  the  date  the  Underlying  Shares   Registration
     Statement  is  declared  effective  by the  Commission  and  notice of such
     effectiveness is delivered to Holder.

5.   "Per Share Market  Value" means on any  particular  date (a) the  aggregate
     price of Common Stock sold on such date on the American  Stock  Exchange or
     on such  subsequent  market  on which the  shares of Common  Stock are then
     listed or quoted  divided by the number of shares of Common  Stock so sold,
     or if there is no such price on such date,  then the  closing  price on the
     American  Stock Exchange or on such  subsequent  market on the date nearest
     preceding  such date,  or (b) if  the  shares of Common  Stock are not then
     listed or quoted on the  American  Stock  Exchange or a subsequent m arket,
     the closing bid price for a share of Common  Stock in the  over-the-counter
     market,  as reported  by the  National  Quotation  Bureau  Incorporated  or
     similar  organization  or agency  succeeding  to its functions of reporting
     prices)  at the close of  business  on such  date,  or (c) if the shares of
     Common  Stock  are not  then  reported  by the  National  Quotation  Bureau
     Incorporated (or similar organization or agency succeeding to its functions
     of reporting  prices),  then the average of the "Pink Sheet" quotes for the
     relevant  conversion  period, as determined in good faith by the Holder, or
     (d) if the shares of Common Stock are not then  publicly  traded,  the fair
     market  value of a share of  Common  Stock as  determined  by an  Appraiser
     selected in good faith by the Holder.

6.   "Purchase  Agreement" means the Securities  Purchase  Agreement dated as of
     December 29, 2000 to which the Company and the Holder hereof are parties.

7.   "Trading  Day"  means  (a) a  day on which the  shares of Common  Stock are
     traded on the American Stock Exchange or on such subsequent market on which
     the shares of Common Stock are then listed or quoted,  or (b) if the shares
     of  Common  Stock  are not  listed  on the  American  Stock  Exchange  or a
     subsequent  market, a day on which the shares of Common Stock are traded in
     the  over-the-counter  market,  as reported by the OTC Bulletin  Board,  or
     (c) if the shares of Common Stock are not quoted on the OTC Bulletin Board,
     a  day  on  which  the   shares  of   Common   Stock  are   quoted  in  the
     over-the-counter  market  as  reported  by the  National  Quotation  Bureau
     Incorporated  (or  any  similar   organization  or  agency  succeeding  its
     functions of reporting prices);  provided,  however, that in the event that
     the  shares of Common  Stock are not  listed or quoted as set forth in (a),
     (b) and (c) hereof, then Trading Day shall mean a Business Day.

8.   "Underlying Shares Registration Statement" shall have the meaning set forth
     in the Purchase Agreement.

9.   "Warrant  Agreement"  means the Warrant  Agreement dated as of the December
     29, 2000 to which the Company and the Holder hereof are parties.

                                                Exhibit B to Warrant Agreement
NEITHER THESE  SECURITIES NOR THE SECURITIES  INTO WHICH THESE  SECURITIES ARE
EXERCISABLE  HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE  COMMISSION
OR THE  SECURITIES  COMMISSION  OF ANY STATE OR PROVINCE  IN RELIANCE  UPON AN
EXEMPTION  FROM  REGISTRATION  UNDER  SECURITIES  ACT OF 1933, AS AMENDED (THE
"SECURITIES  ACT"),  AND,  ACCORDINGLY,  MAY NOT BE  OFFERED  OR  SOLD  EXCEPT
PURSUANT TO AN EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE SECURITIES ACT OR
PURSUANT  TO  AN  AVAILABLE  EXEMPTION  FROM  THE  REGISTRATION   REQUIREMENTS
THEREUNDER  AND IN COMPLIANCE  WITH  APPLICABLE  STATE  SECURITIES OR BLUE SKY
LAWS.

                              MEDIX RESOURCES, INC.

                          Common Stock Purchase Warrant

Warrant No. o                                                   Dated: o, 2001

            Medix  Resources,  Inc., a Colorado  corporation  (the "Company"),
hereby   certifies  that,  for  value   received,   RoyCap  Inc.,  an  Ontario
corporation or its registered assigns (the "Holder"), is entitled,  subject to
the terms and conditions set forth herein,  to purchase from the Company up to
a total of  250,000  shares of common  stock,  $0.001 par value per share (the
"Common  Stock"),  of the Company (each such share, a "Warrant  Share" and all
such shares,  the "Warrant  Shares") in multiples of one hundred  (100) shares
of Common Stock, subject to the terms and conditions set forth herein.  Unless
otherwise  specified,  capitalized  terms used herein are defined in Exhibit A
attached hereto. This Warrant is governed by the Warrant Agreement.

     Registration of Warrant. The Company shall register this Warrant in the
            manner set forth in Section 1.3 of the Warrant Agreement.
                    Registration of Transfers and Exchanges.
   This Warrant may only be transferred pursuant to an effective registration
      statement under the Securities Act, to the Company or pursuant to an
  available exemption from or in a transaction not subject to the registration
   requirements of the Securities Act. In connection with any transfer of this
  Warrant other than pursuant to an effective registration statement or to the
    Company, the Company may require the transferor thereof to provide to the
     Company an opinion of counsel selected by the transferor, the form and
   substance of which opinion shall be reasonably satisfactory to the Company,
     to the effect that such transfer does not require registration of such
 Warrant under the Securities Act. Holder agrees to the imprinting, so long as
   is required by this Section 2(a), of a legend substantially similar to that
       first above written on any New Warrant (as defined below). Any such
   transferee shall agree in writing to be bound by the terms of this Warrant
    and shall have the rights of Holder under this Warrant. The Company shall
    register the transfer of any portion of this Warrant in the records to be
    maintained by the Company for that purpose (the "Warrant Register"), upon
   surrender of this Warrant, with the Form of Assignment attached hereto duly
   completed and signed to the Company at its address for notice set forth in
      Section 10. Upon any such registration or transfer, a new warrant to
   purchase Common Stock, in substantially the form of this Warrant (any such
    new warrant, a "New Warrant"), evidencing the portion of this Warrant so
   transferred shall be issued to the transferee and a New Warrant evidencing
   the remaining portion of this Warrant not so transferred, if any, shall be
   issued to the transferring Holder. The acceptance of the New Warrant by the
   transferee thereof shall be deemed the acceptance of such transferee of all
             of the rights and obligations of a holder of a Warrant.
  This Warrant is exchangeable, upon the surrender hereof by the Holder to the
 Company at its address for notice set forth in Section 10 for one or more New
    Warrants, evidencing in the aggregate the right to purchase the number of
   Warrant Shares which may then be purchased hereunder. Any such New Warrant
                    will be dated the date of such exchange.
                 Duration, Exercise and Redemption of Warrants.
                                                           Exercise By Holder.
(4)   At any time on and  after  the  Effective  Date and  prior to 5:30  p.m.
(Eastern  time) on the Trading Day  immediately  following  [insert date] (the
second year  anniversary of the Drawdown Date) (the  "Expiration  Date"),  the
Holder  shall be entitled to purchase  all or a portion of the Warrant  Shares
which have not been  previously  issued and with respect to which this Warrant
has not been  previously  redeemed or canceled  in  accordance  with the terms
hereof;  subject to the restrictions set forth herein. A "Drawdown Date" means
the  date on  which  the  Holder  makes an  advance  of  funds to the  Company
pursuant to the provisions of the Convertible Note.

(5)   The Holder may purchase  Warrant  Shares  hereunder by delivering to the
Company,  at its address for notice set forth in Section 10, a completed  Form
of  Election  to  Purchase  in the form  attached  hereto,  together  with the
payment of the  Exercise  Price  multiplied  by the  number of Warrant  Shares
indicated  therein.  An "Exercise  Date" means the date of the delivery (which
may be made via  facsimile) of the Form of Election to Purchase and applicable
Exercise Price.

(6)   No later than the third Trading Day  following  delivery of each Form of
Election to Purchase and the  applicable  Exercise  Price,  the Company  shall
promptly  issue or cause to be issued and cause to be delivered to or upon the
written  order of the  Holder  and in such  name or names  as the  Holder  may
designate,  a certificate  for the Warrant Shares issuable upon such exercise,
free of restrictive legends except as required by the Purchase Agreement.

i)    If the  Company  fails to  deliver  to the  Holder  the  certificate  or
certificates  pursuant to this Section  within the time specified  above,  the
Holder  shall be entitled  by written  notice to the Company at any time on or
before its receipt of such certificate or certificates thereafter,  to rescind
such exercise.
ii)   In addition to the rights set forth in (A) above,  if the Company  fails
to deliver to the Holder such  certificate  or  certificates  pursuant to this
Section  within the time  specified  above,  and if after such time the Holder
purchases  (in an open  market  transaction  or  otherwise)  Common  Stock  to
deliver in  satisfaction  of a sale by such Holder of the Warrant Shares which
the Holder  anticipated  receiving  upon such exercise (a "Buy-In"),  then the
Company  shall  (1) pay in cash to the  Holder  the  amount  by which  (x) the
Holder's total purchase price (including  brokerage  commissions,  if any) for
the Common  Stock so  purchased  exceeds (y) the product of (i) the  aggregate
number of Warrant  Shares  that such  Holder  anticipated  receiving  from the
exercise at issue  multiplied  by (ii) the volume  weighted  average Per Share
Market Value on the Exercise Date and (2) at the option of the Holder,  either
rescind  the  exercise at issue or deliver to the Holder the number of Warrant
Shares that would have been issued had the Company  timely  complied  with its
delivery   requirements  under  this  Section.  For  example,  if  the  Holder
purchases  Common  Stock having a total  purchase  price of $11,000 to cover a
Buy-In with respect to an attempted  exercise with respect to which the volume
weighted  average Per Share Market  Value on the Exercise  Date was a total of
$10,000,  the Company shall be required to pay the Holder  $1,000.  The Holder
shall provide the Company  written notice  indicating  the amounts  payable to
the Holder in respect of the Buy-In.

                                                               Exercise Price.
            The  "Exercise  Price"  applicable  to  an  exercise  pursuant  to
Section  3(a) shall  equal One Dollar and  Seventy-Five  Cents U.S.  (US$1.75)
(subject  to  equitable   adjustment   for  stock  splits,   reverse   splits,
combinations and other similar events in accordance with Section 7 hereof).

       Payment of Taxes. The Company will pay all documentary stamp taxes
    attributable to the issuance of Warrant Shares upon the exercise of this
 Warrant; provided, however, that the Company shall not be required to pay any
       tax which may be payable in respect of any transfer involved in the
    registration of any certificates for Warrant Shares or Warrants in a name
  other than that of the Holder. The Holder shall be responsible for all other
    tax liability that may arise as a result of holding or transferring this
            Warrant or receiving Warrant Shares upon exercise hereof.
   Replacement of Warrant. If this Warrant shall be mutilated, lost, stolen or
    destroyed, the Company shall issue, execute and deliver, in exchange and
  substitution for and upon cancellation of a mutilated Warrant, or in lieu of
    or in substitution for a lost, stolen or destroyed Warrant, a New Warrant
  representing an equivalent number of Warrants or Warrant Shares. If required
   by the Company, the Holder must provide indemnity sufficient to protect the
    Company from any loss which it may suffer if the Warrant is replaced. Any
   such New Warrant shall constitute an original contractual obligation of the
   Company, whether or not the allegedly lost, stolen, mutilated or destroyed
               Warrant shall be at any time enforceable by anyone.
    Reservation of Warrant Shares. The Company covenants that it will at all
   times reserve and keep available out of the aggregate of its authorized but
 unissued Common Stock, solely for the purpose of enabling it to issue Warrant
     Shares upon exercise of this Warrant as herein provided, the number of
   Warrant Shares which are then issuable and deliverable upon the exercise of
      this entire Warrant, free from preemptive rights or any other actual
    contingent purchase rights of persons other than the Holder (taking into
 account the adjustments and restrictions of Section 7). The Company covenants
 that all Warrant Shares that shall be so issuable and deliverable shall, upon
  issuance and the payment of the applicable Exercise Price in accordance with
   the terms hereof, be duly and validly authorized, issued and fully paid and
                                 nonassessable.
      Certain Adjustments. The Exercise Price and number of Warrant Shares
  issuable upon exercise of this Warrant is subject to adjustment from time to
           time as set forth in Article III of the Warrant Agreement.
     Payment of Exercise Price. The Holder shall pay the Exercise Price for
 Warrant Shares purchased hereunder by delivery of immediately available funds
                     unless otherwise agreed by the Company.
  Fractional Shares. The Company shall not be required to issue or cause to be
  issued fractional Warrant Shares on the exercise of this Warrant. The number
    of full Warrant Shares which shall be issuable upon the exercise of this
    Warrant shall be computed on the basis of the aggregate number of Warrant
  Shares purchasable on exercise of this Warrant so presented. If any fraction
     of a Warrant Share would, except for the provisions of this Section, be
  issuable on the exercise of this Warrant, the Company shall pay an amount in
          cash equal to the Exercise Price multiplied by such fraction.
  Notices. Any and all notices or other communications or deliveries hereunder
   shall be in writing and shall be deemed given and effective on the earliest
 of (i) the date of transmission, if such notice or communication is delivered
    via facsimile at the facsimile telephone number specified in this Section
    prior to 8:00 p.m. (Denver time) on a business day, (ii) the business day
  after the date of transmission, if such notice or communication is delivered
    via facsimile at the facsimile telephone number specified in this Section
    later than 8:00 p.m (Denver time) on any date and earlier than 11:59 p.m.
    (Denver time) on such date, (iii) the business day following the date of
  mailing, if sent by nationally recognized overnight courier service, or (iv)
    if sent other than by the methods set forth in (i)-(iii) of this section,
     upon actual receipt by the party to whom such notice is required to be
      given. The addresses for such communications shall be: (i) if to the
    Company, to 7100 Belleview Ave., Suite 301, Greenwood Village, Colorado,
   80111, Attention: President, or to Facsimile No. (303) 850-9519, or (ii) if
  to the Holder, to the Holder at the address or facsimile number appearing on
  the Warrant Register or such other address or facsimile number as the Holder
           may provide to the Company in accordance with this Section.
   Warrant Agent. The Company shall serve as warrant agent under this Warrant.
   Upon thirty (30) days' notice to the Holder, the Company may appoint a new
    warrant agent. Any corporation into which the Company or any new warrant
   agent may be merged or any corporation resulting from any consolidation to
       which the Company or any new warrant agent shall be a party or any
       corporation to which the Company or any new warrant agent transfers
   substantially all of its corporate trust or shareholders services business
    shall be a successor warrant agent under this Warrant without any further
    act. Any such successor warrant agent shall promptly cause notice of its
     succession as warrant agent to be mailed (by first class mail, postage
   prepaid) to the Holder at the Holder's last address as shown on the Warrant
                                    Register.
                                 Miscellaneous.
    This Warrant shall be binding on and inure to the benefit of the parties
     hereto and their respective successors and assigns. This Warrant may be
     amended only in writing signed by the Company and the Holder and their
                        successors and permitted assigns.
   Subject to Section 12(a), above, nothing in this Warrant shall be construed
   to give to any person or corporation other than the Company and the Holder
     any legal or equitable right, remedy or cause under this Warrant. This
  Warrant shall inure to the sole and exclusive benefit of the Company and the
                                     Holder.
       The corporate laws of the State of Colorado shall govern all issues
     concerning the relative rights of the Company and its stockholders. All
     other questions concerning the construction, validity, enforcement and
      interpretation of this Warrant shall be governed by and construed and
 enforced in accordance with the laws of the State of New York, without regard
    to the principles of conflicts of law thereof. The Company and the Holder
    hereby irrevocably submit to the jurisdictions of either the Province of
   Ontario or the state of New York, as determined by the party initiating any
   proceeding, for the adjudication of any dispute hereunder or in connection
 herewith or with any transaction contemplated hereby or discussed herein, and
   hereby irrevocably waives, and agrees not to assert in any suit, action or
   proceeding, any claim that it is not personally subject to the jurisdiction
  of any such court, or that such suit, action or proceeding is improper. Each
   of the Company and the Holder hereby irrevocably waives personal service of
    process and consents to process being served in any such suit, action or
  proceeding by receiving a copy thereof sent to the Company at the address in
   effect for notices to it under this instrument and agrees that such service
   shall constitute good and sufficient service of process and notice thereof.
    Nothing contained herein shall be deemed to limit in any way any right to
                  serve process in any manner permitted by law.
    The headings herein are for convenience only, do not constitute a part of
 this Warrant and shall not be deemed to limit or affect any of the provisions
                                     hereof.
 In case any one or more of the provisions of this Warrant shall be invalid or
      unenforceable in any respect, the validity and enforceability of the
     remaining terms and provisions of this Warrant shall not in any way be
   affected or impaired thereby and the parties will attempt in good faith to
   agree upon a valid and enforceable provision which shall be a commercially
  reasonable substitute therefor, and upon so agreeing, shall incorporate such
                      substitute provision in this Warrant.

            IN WITNESS  WHEREOF,  the Company  has caused  this  Warrant to be
duly executed by its authorized officer as of the date first indicated above.

                                         MEDIX RESOURCES, INC.

                                         By: _____________________________
                                         Name:
                                         Title:

                          FORM OF ELECTION TO PURCHASE

(To be  executed by the Holder to  exercise  the right to  purchase  shares of
Common Stock under the foregoing Warrant)

To Medix Resources, Inc.:

            In  accordance  with  the  Warrant  enclosed  with  this  Form  of
Election to Purchase,  the undersigned  hereby  irrevocably elects to purchase
_____________  shares of common  stock,  $.001 par value per  share,  of Medix
Resources,  Inc. (the "Common Stock") and encloses herewith  $________ in cash
by wire transfer,  or by certified or official bank check or checks, which sum
represents  the aggregate  Exercise  Price (as defined in the Warrant) for the
number of shares of Common  Stock to which this Form of  Election  to Purchase
relates,  together  with  any  applicable  taxes  payable  by the  undersigned
pursuant to the Warrant.

            The  undersigned  requests  that  certificates  for the  shares of
Common Stock issuable upon this exercise be issued in the name of

PLEASE INSERT SOCIAL SECURITY OR TAX IDENTIFICATION NUMBER

------------------------------------------------------------------------------

------------------------------------------------------------------------------
                       (Please print name and address)

            If the  number  of  shares  of  Common  Stock  issuable  upon this
exercise shall not be all of the shares of Common Stock which the  undersigned
is  entitled  to  purchase  in  accordance  with  the  enclosed  Warrant,  the
undersigned   requests  that  a  New  Warrant  (as  defined  in  the  Warrant)
evidencing  the right to  purchase  the  shares of Common  Stock not  issuable
pursuant  to the  exercise  evidenced  hereby  be  issued  in the  name of and
delivered to:

------------------------------------------------------------------------------
                       (Please print name and address)
------------------------------------------------------------------------------

------------------------------------------------------------------------------

------------------------------------------------------------------------------

Dated:  _____, _____                     Name of Holder:

(Print)_______________________________________________________________________

(By:) ________________________________________________________________________
(Name:)
(Title:)
                                         (Signature must conform in all
                                         respects to name of holder as
                                         specified on the face of the Warrant)

                              FORM OF ASSIGNMENT

          [To be completed and signed only upon transfer of Warrant]

            FOR VALUE  RECEIVED,  the  undersigned  hereby sells,  assigns and
transfers unto  ________________________________  the right represented by the
within  Warrant  to  purchase  ____________  shares of  Common  Stock of Medix
Resources,   Inc.  to  which  the  within   Warrant   relates   and   appoints
________________  attorney  to  transfer  said  right  on the  books  of Medix
Resources, Inc. with full power of substitution in the premises.

Dated:
---------------, ----------

                                         -------------------------------------
                                         (Signature must conform in all
                                         respects to name of holder as
                                         specified on the face of the Warrant)

                                         -------------------------------------

                                         Address of Transferee
                                         =====================================
                                         ----------------------------------------

In the presence of:
-------------------------------------

                                  Exhibit A

1.   "Business  Day"  means any day  except  Saturday,  Sunday and any day which
     shall be a federal legal holiday or a day on which banking  institutions in
     the  State  of  Colorado  are  authorized  or  required  by  law  or  other
     governmental action to close.

2.   "Commission" means the Securities and Exchange Commission.

3.   "Convertible  Note"  means the  Convertible  Note dated  December  29, 2000
     issued by the Company in favour of the Holder which  permits the Company to
     draw up to two million five hundred thousand US Dollars (US$2,500,000).

4.   "Effective  Date"  means  the  date  the  Underlying  Shares   Registration
     Statement  is  declared  effective  by the  Commission  and  notice of such
     effectiveness is delivered to Holder.

5.   "Per Share Market  Value" means on any  particular  date (a) the  aggregate
     price of Common Stock sold on such date on the American  Stock  Exchange or
     on such  Subsequent  Market  on which the  shares of Common  Stock are then
     listed or quoted  divided by the number of shares of Common  Stock so sold,
     or if there is no such price on such date,  then the  closing  price on the
     American  Stock Exchange or on such  Subsequent  Market on the date nearest
     preceding  such date,  or (b) if  the  shares of Common  Stock are not then
     listed or quoted on the American Stock Exchange or a Subsequent Market, the
     closing  bid  price  for a share of  Common  Stock in the  over-the-counter
     market,  as reported  by the  National  Quotation  Bureau  Incorporated  or
     similar  organization  or agency  succeeding  to its functions of reporting
     prices)  at the close of  business  on such  date,  or (c) if the shares of
     Common  Stock  are not  then  reported  by the  National  Quotation  Bureau
     Incorporated (or similar organization or agency succeeding to its functions
     of reporting  prices),  then the average of the "Pink Sheet" quotes for the
     relevant  conversion  period, as determined in good faith by the Holder, or
     (d) if the shares of Common Stock are not then  publicly  traded,  the fair
     market  value of a share of  Common  Stock as  determined  by an  Appraiser
     selected in good faith by the Holder.

6.   "Purchase  Agreement" means the Securities  Purchase  Agreement dated as of
     December 29, 2000 to which the Company and the Holder hereof are parties.

7.   "Trading  Day"  means  (a) a  day on which the  shares of Common  Stock are
     traded on the American Stock Exchange or on such Subsequent Market on which
     the shares of Common Stock are then listed or quoted,  or (b) if the shares
     of  Common  Stock  are not  listed  on the  American  Stock  Exchange  or a
     Subsequent  Market, a day on which the shares of Common Stock are traded in
     the  over-the-counter  market,  as reported by the OTC Bulletin  Board,  or
     (c) if the shares of Common Stock are not quoted on the OTC Bulletin Board,
     a  day  on  which  the   shares  of   Common   Stock  are   quoted  in  the
     over-the-counter  market  as  reported  by the  National  Quotation  Bureau
     Incorporated  (or  any  similar   organization  or  agency  succeeding  its
     functions of reporting prices);  provided,  however, that in the event that
     the  shares of Common  Stock are not  listed or quoted as set forth in (a),
     (b) and (c) hereof, then Trading Day shall mean a Business Day.

8."Underlying Shares Registration Statement" shall have the meaning set forth in
     the Purchase Agreement.

9.   "Warrant  Agreement"  means the Warrant  Agreement dated as of the December
     29, 2000 to which the Company and the Holder hereof are parties.

                                                Exhibit C to Warrant Agreement
NEITHER THESE  SECURITIES NOR THE SECURITIES  INTO WHICH THESE  SECURITIES ARE
EXERCISABLE  HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE  COMMISSION
OR THE  SECURITIES  COMMISSION  OF ANY STATE OR PROVINCE  IN RELIANCE  UPON AN
EXEMPTION  FROM  REGISTRATION  UNDER  SECURITIES  ACT OF 1933, AS AMENDED (THE
"SECURITIES  ACT"),  AND,  ACCORDINGLY,  MAY NOT BE  OFFERED  OR  SOLD  EXCEPT
PURSUANT TO AN EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE SECURITIES ACT OR
PURSUANT  TO  AN  AVAILABLE  EXEMPTION  FROM  THE  REGISTRATION   REQUIREMENTS
THEREUNDER  AND IN COMPLIANCE  WITH  APPLICABLE  STATE  SECURITIES OR BLUE SKY
LAWS.

                              MEDIX RESOURCES, INC.

                       Common Stock Purchase Call Warrant

Warrant No. o                                                   Dated: o, 2001

            Medix  Resources,  Inc., a Colorado  corporation  (the "Company"),
hereby   certifies  that,  for  value   received,   RoyCap  Inc.,  an  Ontario
corporation or its registered assigns (the "Holder"), is entitled,  subject to
the terms and conditions set forth herein,  to purchase from the Company up to
a total of  750,000  shares of common  stock,  $0.001 par value per share (the
"Common  Stock"),  of the Company (each such share, a "Warrant  Share" and all
such shares,  the "Warrant  Shares") in multiples of one hundred  (100) shares
of Common Stock, subject to the terms and conditions set forth herein.  Unless
otherwise  specified,  capitalized  terms used herein are defined in Exhibit A
attached hereto. This Warrant is governed by the Warrant Agreement.

(a)  Registration  of Warrant.  The Company  shall  register this Warrant in the
     manner set forth in Section 1.3 of the Warrant Agreement.

(b)  Registration of Transfers and Exchanges.

     (i)  This  Warrant  may  only  be  transferred  pursuant  to  an  effective
          registration  statement  under the  Securities  Act, to the Company or
          pursuant  to an  available  exemption  from  or in a  transaction  not
          subject to the  registration  requirements  of the Securities  Act. In
          connection with any transfer of this Warrant other than pursuant to an
          effective  registration  statement or to the Company,  the Company may
          require the transferor thereof to provide to the Company an opinion of
          counsel  selected by the  transferor,  the form and substance of which
          opinion shall be reasonably satisfactory to the Company, to the effect
          that such transfer does not require registration of such Warrant under
          the Securities  Act.  Holder agrees to the  imprinting,  so long as is
          required by this Section  2(a), of a legend  substantially  similar to
          that first above  written on any New Warrant (as defined  below).  Any
          such  transferee  shall  agree in  writing to be bound by the terms of
          this Warrant and shall have the rights of Holder  under this  Warrant.
          The Company shall register the transfer of any portion of this Warrant
          in the records to be  maintained  by the Company for that purpose (the
          "Warrant Register"),  upon surrender of this Warrant, with the Form of
          Assignment attached hereto duly completed and signed to the Company at
          its  address  for  notice  set  forth  in  Section  10.  Upon any such
          registration  or transfer,  a new warrant to purchase Common Stock, in
          substantially  the form of this Warrant (any such new warrant,  a "New
          Warrant"), evidencing the portion of this Warrant so transferred shall
          be issued to the transferee and a New Warrant evidencing the remaining
          portion of this Warrant not so transferred, if any, shall be issued to
          the  transferring  Holder.  The  acceptance  of the New Warrant by the
          transferee  thereof shall be deemed the acceptance of such  transferee
          of all of the rights and  obligations  of a holder of a Warrant.

     (ii) This Warrant is exchangeable,  upon the surrender hereof by the Holder
          to the  Company at its  address for notice set forth in Section 10 for
          one or more New  Warrants,  evidencing  in the  aggregate the right to
          purchase  the number of  Warrant  Shares  which may then be  purchased
          hereunder.  Any  such  New  Warrant  will be  dated  the  date of such
          exchange.  (c)  Duration,  Exercise and  Redemption  of Warrants.  (i)
          Exercise  By  Holder.  

          (1)  At any time on or  before  the  forty-fifth  (45th)  day from the
               Effective  Date (the  "Expiration  Date"),  the  Holder  shall be
               entitled to purchase all or a portion of the Warrant Shares which
               have not been  previously  issued and with  respect to which this
               Warrant  has  not  been   previously   redeemed  or  canceled  in
               accordance with the terms hereof; subject to the restrictions set
               forth herein.

          (2)  The Holder may purchase Warrant Shares hereunder by delivering to
               the Company, at its address for notice set forth in Section 10, a
               completed  Form of  Election  to  Purchase  in the form  attached
               hereto,   together  with  the  payment  of  the  Exercise   Price
               multiplied by the number of Warrant Shares indicated therein.  An
               "Exercise Date" means the date of the delivery (which may be made
               via facsimile) of the Form of Election to Purchase and applicable
               Exercise Price.

          (3)  No later than the third  Trading Day  following  delivery of each
               Form of Election to Purchase and the applicable  Exercise  Price,
               the Company shall  promptly issue or cause to be issued and cause
               to be delivered to or upon the written order of the Holder and in
               such name or names as the Holder may designate, a certificate for
               the  Warrant  Shares   issuable  upon  such  exercise,   free  of
               restrictive legends except as required by the Purchase Agreement.

               If the Company fails to deliver to the Holder the certificate  or
               certificates  pursuant to this Section  within the time specified
               above,  the Holder  shall be  entitled  by written  notice to the
               Company at any time on or before its receipt of such  certificate
               or certificates thereafter, to rescind such exercise.

                              In  addition  to the  rights  set  forth  in (A)
above,  if the  Company  fails to deliver to the Holder  such  certificate  or
certificates  pursuant to this Section within the time specified above, and if
after  such  time the  Holder  purchases  (in an open  market  transaction  or
otherwise)  Common Stock to deliver in  satisfaction  of a sale by such Holder
of the  Warrant  Shares  which  the  Holder  anticipated  receiving  upon such
exercise (a  "Buy-In"),  then the Company  shall (1) pay in cash to the Holder
the  amount  by  which  (x)  the  Holder's  total  purchase  price  (including
brokerage  commissions,  if any) for the Common Stock so purchased exceeds (y)
the  product of (i) the  aggregate  number of Warrant  Shares that such Holder
anticipated  receiving  from  the  exercise  at issue  multiplied  by (ii) the
volume  weighted  average Per Share Market Value on the Exercise  Date and (2)
at the option of the Holder,  either  rescind the exercise at issue or deliver
to the Holder the number of  Warrant  Shares  that would have been  issued had
the  Company  timely  complied  with  its  delivery  requirements  under  this
Section.  For  example,  if the Holder  purchases  Common Stock having a total
purchase  price of $11,000  to cover a Buy-In  with  respect  to an  attempted
exercise  with respect to which the volume  weighted  average Per Share Market
Value on the  Exercise  Date  was a total of  $10,000,  the  Company  shall be
required  to pay the Holder  $1,000.  The Holder  shall  provide  the  Company
written notice  indicating the amounts payable to the Holder in respect of the
Buy-In.

(ii) Exercise Price.
            The  "Exercise  Price"  applicable  to  an  exercise  pursuant  to
Section  3(a) shall equal  Ninety US Cents  (US$0.90)  (subject  to  equitable
adjustment for stock splits,  reverse splits,  combinations  and other similar
events in accordance with Section 7 hereof).

(d)  Payment  of  Taxes.  The  Company  will  pay all  documentary  stamp  taxes
     attributable  to the  issuance of Warrant  Shares upon the exercise of this
     Warrant;  provided,  however, that the Company shall not be required to pay
     any tax which may be payable in respect  of any  transfer  involved  in the
     registration of any  certificates  for Warrant Shares or Warrants in a name
     other than that of the  Holder.  The Holder  shall be  responsible  for all
     other tax liability  that may arise as a result of holding or  transferring
     this Warrant or receiving Warrant Shares upon exercise hereof.

(e)  Replacement of Warrant. If this Warrant shall be mutilated, lost, stolen or
     destroyed,  the Company shall issue,  execute and deliver,  in exchange and
     substitution for and upon cancellation of a mutilated  Warrant,  or in lieu
     of or in  substitution  for a lost,  stolen  or  destroyed  Warrant,  a New
     Warrant representing an equivalent number of Warrants or Warrant Shares. If
     required by the Company,  the Holder must provide  indemnity  sufficient to
     protect  the  Company  from any loss which it may suffer if the  Warrant is
     replaced.  Any such New Warrant shall  constitute  an original  contractual
     obligation  of the  Company,  whether or not the  allegedly  lost,  stolen,
     mutilated or destroyed Warrant shall be at any time enforceable by anyone.

(f)  Reservation of Warrant  Shares.  The Company  covenants that it will at all
     times reserve and keep available out of the aggregate of its authorized but
     unissued  Common  Stock,  solely for the  purpose of  enabling  it to issue
     Warrant Shares upon exercise of this Warrant as herein provided, the number
     of Warrant Shares which are then issuable and deliverable upon the exercise
     of this entire  Warrant,  free from  preemptive  rights or any other actual
     contingent  purchase  rights of persons other than the Holder  (taking into
     account  the  adjustments  and  restrictions  of Section  7).  The  Company
     covenants that all Warrant Shares that shall be so issuable and deliverable
     shall,  upon issuance and the payment of the  applicable  Exercise Price in
     accordance with the terms hereof,  be duly and validly  authorized,  issued
     and fully paid and nonassessable.

(g)  Certain  Adjustments.  The  Exercise  Price and  number of  Warrant  Shares
     issuable upon  exercise of this Warrant is subject to adjustment  from time
     to time as set forth in Article III of the Warrant Agreement.

(h)  Payment of Exercise  Price.  The Holder  shall pay the  Exercise  Price for
     Warrant Shares  purchased  hereunder by delivery of  immediately  available
     funds unless otherwise agreed by the Company.

(i)  Fractional  Shares.  The Company shall not be required to issue or cause to
     be issued  fractional  Warrant Shares on the exercise of this Warrant.  The
     number of full Warrant  Shares which shall be issuable upon the exercise of
     this  Warrant  shall be  computed on the basis of the  aggregate  number of
     Warrant Shares purchasable on exercise of this Warrant so presented. If any
     fraction  of a Warrant  Share  would,  except  for the  provisions  of this
     Section, be issuable on the exercise of this Warrant, the Company shall pay
     an amount in cash equal to the Exercise Price multiplied by such fraction.

(j)  Notices.  Any  and  all  notices  or  other  communications  or  deliveries
     hereunder  shall be in writing and shall be deemed  given and  effective on
     the  earliest  of  (i)  the  date  of  transmission,   if  such  notice  or
     communication is delivered via facsimile at the facsimile  telephone number
     specified in this Section  prior to 8:00 p.m.  (Denver  time) on a business
     day, (ii) the business day after the date of  transmission,  if such notice
     or  communication  is delivered via  facsimile at the  facsimile  telephone
     number  specified in this Section  later than 8:00 p.m (Denver time) on any
     date and  earlier  than 11:59 p.m.  (Denver  time) on such date,  (iii) the
     business  day  following  the  date  of  mailing,  if  sent  by  nationally
     recognized  overnight  courier  service,  or (iv) if sent other than by the
     methods set forth in (i)-(iii) of this section,  upon actual receipt by the
     party to whom such notice is required to be given.  The  addresses for such
     communications  shall be: (i) if to the Company,  to 7100  Belleview  Ave.,
     Suite 301, Greenwood Village, Colorado, 80111, Attention:o, or to Facsimile
     No. (303) 850-9519,  or (ii) if to the Holder, to the Holder at the address
     or facsimile number appearing on the Warrant Register or such other address
     or facsimile  number as the Holder may provide to the Company in accordance
     with this Section.

(k)  Warrant Agent. The Company shall serve as warrant agent under this Warrant.
     Upon thirty (30) days' notice to the Holder,  the Company may appoint a new
     warrant agent.  Any  corporation  into which the Company or any new warrant
     agent may be merged or any corporation  resulting from any consolidation to
     which  the  Company  or any new  warrant  agent  shall  be a  party  or any
     corporation  to  which  the  Company  or any new  warrant  agent  transfers
     substantially all of its corporate trust or shareholders  services business
     shall be a successor  warrant agent under this Warrant  without any further
     act. Any such  successor  warrant agent shall  promptly cause notice of its
     succession  as warrant  agent to be mailed (by first  class  mail,  postage
     prepaid) to the Holder at the Holder's last address as shown on the Warrant
     Register.

(l)  Miscellaneous.

     (i)  This  Warrant  shall be  binding  on and inure to the  benefit  of the
          parties  hereto and their  respective  successors  and  assigns.  This
          Warrant may be amended  only in writing  signed by the Company and the
          Holder and their successors and permitted assigns.

     (ii) Subject to Section  12(a),  above,  nothing in this  Warrant  shall be
          construed to give to any person or corporation  other than the Company
          and the Holder any legal or  equitable  right,  remedy or cause  under
          this  Warrant.  This  Warrant  shall  inure to the sole and  exclusive
          benefit of the Company and the Holder. (iii) The corporate laws of the
          State of Colorado  shall  govern all issues  concerning  the  relative
          rights  of the  Company  and its  stockholders.  All  other  questions
          concerning the construction,  validity, enforcement and interpretation
          of this  Warrant  shall be governed by and  construed  and enforced in
          accordance  with the laws of the State of New York,  without regard to
          the principles of conflicts of law thereof. The Company and the Holder
          hereby  irrevocably  submit to the jurisdiction of either the Province
          of  Ontario  or the  State of New  York,  as  determined  by the party
          initiating  any  proceeding,  for  the  adjudication  of  any  dispute
          hereunder  or  in   connection   herewith  or  with  any   transaction
          contemplated  hereby  or  discussed  herein,  and  hereby  irrevocably
          waives,  and agrees not to assert in any suit,  action or  proceeding,
          any claim that it is not personally subject to the jurisdiction of any
          such court, or that such suit, action or proceeding is improper.  Each
          of the  Company  and the Holder  hereby  irrevocably  waives  personal
          service of process and  consents to process  being  served in any such
          suit,  action or  proceeding  by  receiving a copy thereof sent to the
          Company  at the  address  in  effect  for  notices  to it  under  this
          instrument  and agrees that such  service  shall  constitute  good and
          sufficient  service of process and notice thereof.  Nothing  contained
          herein shall be deemed to limit in any way any right to serve  process
          in any manner permitted by law.

     (iv) The headings herein are for convenience only, do not constitute a part
          of this  Warrant and shall not be deemed to limit or affect any of the
          provisions hereof.

     (v)  In case any one or more of the  provisions  of this  Warrant  shall be
          invalid  or   unenforceable   in  any   respect,   the   validity  and
          enforceability  of the remaining  terms and provisions of this Warrant
          shall not in any way be affected  or impaired  thereby and the parties
          will  attempt  in good  faith to agree  upon a valid  and  enforceable
          provision  which  shall  be  a  commercially   reasonable   substitute
          therefor,  and upon so agreeing,  shall  incorporate  such  substitute
          provision in this Warrant.

            IN WITNESS  WHEREOF,  the Company  has caused  this  Warrant to be
duly executed by its authorized officer as of the date first indicated above.

                                         MEDIX RESOURCES, INC.

                                         By: ______________________________
                                         Name:
                                         Title:

                          FORM OF ELECTION TO PURCHASE

(To be  executed by the Holder to  exercise  the right to  purchase  shares of
Common Stock under the foregoing Warrant)

To Medix Resources, Inc.:

            In  accordance  with  the  Warrant  enclosed  with  this  Form  of
Election to Purchase,  the undersigned  hereby  irrevocably elects to purchase
_____________  shares of common  stock,  $.001 par value per  share,  of Medix
Resources,  Inc. (the "Common Stock") and encloses herewith  $________ in cash
by wire transfer,  or by certified or official bank check or checks, which sum
represents  the aggregate  Exercise  Price (as defined in the Warrant) for the
number of shares of Common  Stock to which this Form of  Election  to Purchase
relates,  together  with  any  applicable  taxes  payable  by the  undersigned
pursuant to the Warrant.

            The  undersigned  requests  that  certificates  for the  shares of
Common Stock issuable upon this exercise be issued in the name of

PLEASE INSERT SOCIAL SECURITY OR TAX IDENTIFICATION NUMBER

------------------------------------------------------------------------------

------------------------------------------------------------------------------
                       (Please print name and address)

            If the  number  of  shares  of  Common  Stock  issuable  upon this
exercise shall not be all of the shares of Common Stock which the  undersigned
is  entitled  to  purchase  in  accordance  with  the  enclosed  Warrant,  the
undersigned   requests  that  a  New  Warrant  (as  defined  in  the  Warrant)
evidencing  the right to  purchase  the  shares of Common  Stock not  issuable
pursuant  to the  exercise  evidenced  hereby  be  issued  in the  name of and
delivered to:

------------------------------------------------------------------------------
                       (Please print name and address)
------------------------------------------------------------------------------

------------------------------------------------------------------------------

Dated:  _____, _____                     Name of Holder:

(Print)_______________________________________________________________________

(By:) ________________________________________________________________________
(Name:)
(Title:)
                                         (Signature must conform in all
                                         respects to name of holder as
                                         specified on the face of the Warrant)

                               FORM OF ASSIGNMENT

          [To be completed and signed only upon transfer of Warrant]

            FOR VALUE  RECEIVED,  the  undersigned  hereby sells,  assigns and
transfers unto  ________________________________  the right represented by the
within  Warrant  to  purchase  ____________  shares of  Common  Stock of Medix
Resources,   Inc.  to  which  the  within   Warrant   relates   and   appoints
________________  attorney  to  transfer  said  right  on the  books  of Medix
Resources, Inc. with full power of substitution in the premises.

Dated:
---------------, ----------

                                         --------------------------------------
                                         (Signature must conform in all
                                         respects to name of holder as
                                         specified on the face of the Warrant)

                                         --------------------------------------

                                         Address of Transferee

                                         --------------------------------------

                                         --------------------------------------

In the presence of:
--------------------------------------

                                    Exhibit A

1.   "Business  Day"  means any day  except  Saturday,  Sunday and any day which
     shall be a federal legal holiday or a day on which banking  institutions in
     the  State  of  Colorado  are  authorized  or  required  by  law  or  other
     governmental action to close.

2.   "Commission" means the Securities and Exchange Commission.

3.   "Effective  Date"  means  the  date  the  Underlying  Shares   Registration
     Statement  is  declared  effective  by the  Commission  and  notice of such
     effectiveness is delivered to Holder.

4.   "Per Share Market  Value" means on any  particular  date (a) the  aggregate
     price of Common Stock sold on such date on the American  Stock  Exchange or
     on such  Subsequent  Market  on which the  shares of Common  Stock are then
     listed or quoted  divided by the number of shares of Common  Stock so sold,
     or if there is no such price on such date,  then the  closing  price on the
     American  Stock Exchange or on such  Subsequent  Market on the date nearest
     preceding  such date,  or (b) if  the  shares of Common  Stock are not then
     listed or quoted on the American Stock Exchange or a Subsequent Market, the
     closing  bid  price  for a share of  Common  Stock in the  over-the-counter
     market,  as reported  by the  National  Quotation  Bureau  Incorporated  or
     similar  organization  or agency  succeeding  to its functions of reporting
     prices)  at the close of  business  on such  date,  or (c) if the shares of
     Common  Stock  are not  then  reported  by the  National  Quotation  Bureau
     Incorporated (or similar organization or agency succeeding to its functions
     of reporting  prices),  then the average of the "Pink Sheet" quotes for the
     relevant  conversion  period, as determined in good faith by the Holder, or
     (d) if the shares of Common Stock are not then  publicly  traded,  the fair
     market  value of a share of  Common  Stock as  determined  by an  Appraiser
     selected in good faith by the Holder.

5.   "Purchase  Agreement" means the Securities  Purchase  Agreement dated as of
     December 29, 2000 to which the Company and the Holder hereof are parties.

6.   "Trading  Day"  means  (a) a  day on which the  shares of Common  Stock are
     traded on the American Stock Exchange or on such Subsequent Market on which
     the shares of Common Stock are then listed or quoted,  or (b) if the shares
     of  Common  Stock  are not  listed  on the  American  Stock  Exchange  or a
     Subsequent  Market, a day on which the shares of Common Stock are traded in
     the  over-the-counter  market,  as reported by the OTC Bulletin  Board,  or
     (c) if the shares of Common Stock are not quoted on the OTC Bulletin Board,
     a  day  on  which  the   shares  of   Common   Stock  are   quoted  in  the
     over-the-counter  market  as  reported  by the  National  Quotation  Bureau
     Incorporated  (or  any  similar   organization  or  agency  succeeding  its
     functions of reporting prices);  provided,  however, that in the event that
     the  shares of Common  Stock are not  listed or quoted as set forth in (a),
     (b) and (c) hereof, then Trading Day shall mean a Business Day.

7.   "Underlying Shares Registration Statement" shall have the meaning set forth
     in the Purchase Agreement.

8.   "Warrant  Agreement"  means the Warrant  Agreement dated as of the December
     29, 2000 to which the Company and the Holder hereof are parties.<PAGE>   1

                                                                   EXHIBIT 10.53

                            Dated: September 29, 2000

                     WARNER CHILCOTT PUBLIC LIMITED COMPANY

                                     - and -

                                JAMES G. ANDRESS

            --------------------------------------------------------

                              CONSULTANCY AGREEMENT

            --------------------------------------------------------

                              ASHURST MORRIS CRISP
                                 Broadwalk House
                                 5 Appold Street
                                 London EC2A 2HA

                               Tel: 020 7638 1111
                               Fax: 020 7972 7990

<PAGE>   2

THIS AGREEMENT is made on September 29, 2000

BETWEEN:

(1)      WARNER CHILCOTT PUBLIC LIMITED COMPANY whose registered office is at
                                                          (the "COMPANY"); and

(2)      JAMES G ANDRESS of 1381 North Elm Tree Road, Lake Forest, IL 60045, USA
         (the "CONSULTANT").

THE PARTIES AGREE AS FOLLOWS:

1.       DEFINITIONS

         In this agreement the following expressions shall unless the context
         otherwise requires have the following meanings:

         "ASSOCIATED COMPANY" means an associate or joint venture which falls to
         be treated as such for the purposes of the Financial Reporting Standard
         No. 9 of the UK Accounting Standards Board;

         "BOARD" means the board of directors from time to time of the Company
         including any committee of the board duly appointed by it;

         "COMPLETION" means the date that the agreement pursuant to which Galen
         Holdings plc will exchange all of the outstanding securities of the
         Company for ordinary shares in Galen Holdings plc pursuant to a scheme
         of arrangement pursuant to section 201 of the Irish Companies Act is
         completed;

         "CONSULTANCY FEE" means the amount referred to in and calculated and
         payable in accordance with clause 4 hereto;

         "GROUP COMPANY" means the Company and any subsidiary and associated
         company of the Company;

         "RETAINED PERIOD" means the period or periods referred to in schedule 1
         hereto;

         "SERVICES" means the services to be provided by the Consultant in a
         consultancy and advisory capacity for the Group Companies as the Board
         may reasonably require from time to time more particularly set out in
         clause 3.1;

         "SEPARATION AGREEMENT" means the Separation Agreement and Mutual
         Release entered into between Consultant and the Company.

         "SUBSIDIARY" has the meaning given to it in section 736 of the UK
         Companies Act 1985; and

         "TERMINATION DATE" means the date of termination of this agreement
         howsoever occasioned.

<PAGE>   3

2.       TERM OF APPOINTMENT

2.1      The Company shall engage the Consultant to and the Consultant shall
         provide the Services as hereinafter provided (the "CONSULTANCY").

2.2      The Consultancy shall be deemed to have commenced on Completion and
         shall continue (subject to termination as provided below) unless and
         until terminated by either party giving to the other not less than
         three months' prior notice such notice to expire on or at any time 18
         months from Completion (the "EXPECTED TERMINATION DATE").

3.       DUTIES

3.1      During the Consultancy, the Consultant shall use his best endeavours to
         promote the interests of the Group Companies and in particular, shall
         (unless prevented by illness or accident) provide the following
         Services to any Group Company in a proper and efficient manner for the
         Retained Period: reasonable assistance to the Company and any Group
         Company on its day-to-day business and use his valuable knowledge
         regarding the Company's industry and business for the benefit of the
         Company and any Group Company.

3.2      If the Consultant is unable to provide the Services due to illness or
         injury or otherwise he shall forthwith notify the Company and, if
         appropriate, shall provide such evidence of his illness or injury as
         the Company may reasonably require.

3.3      When the performance of the Services so requires the Company will make
         available to the Consultant at a suitable location free of any charge
         office facilities and secretarial assistance of a type appropriate.

3.4      During the Consultancy the Consultant may engage in any other business
         of professional activities, either on a full-time or part-time basis,
         so long as such activities, either singly or in the aggregate, do not
         interfere with the proper performance of his duties and
         responsibilities to the Company or any Group Company or violate any
         prior agreement between him and the Company or any Group Company or any
         other provision of this Agreement.

3.5      The Consultant shall use reasonable endeavours to ensure that the
         Company can contact him at all times during normal U.S. business hours.

3.6      The Consultant shall have no authority and shall not hold himself out
         as having authority to bind the Company save insofar as he is
         specifically authorised to do so by the Company in writing.

3.7      The Consultant shall not have any personal liability for the
         consequences of any advice or assistance rendered to the Company if he
         shall have acted honestly and reasonably in all the circumstances of
         the case and accordingly to that extent he shall be indemnified by the
         Company against all costs, charges, losses, expenses and liabilities
         incurred by him in the discharge of the Services PROVIDED that this
         clause 3.7 shall not absolve the Consultant from any liability arising
         out of him acting without the prior written authority of the Company.

<PAGE>   4

4.       FEES

4.1      In consideration of the provision by the Consultant of the Services
         during the Consultancy the Company shall pay the Consultancy Fee (as
         set out in this clause) to the Consultant.

4.2      The Consultant shall receive a monthly fee in the sum of $15,277.77
         monthly in arrears by credit transfer within 14 days of the end of such
         month for the duration of the Consultancy. Should the Consultancy
         terminate by reason of death, injury, disability or ill-health, the
         Consultant or his executors shall retain all payments received
         hereunder up to that date (the "DATE OF CESSATION") and a further
         payment equal to the further payments which would otherwise be due
         calculated from the Date of Cessation to the Expected Termination Date
         shall be paid to the Consultant or his executors. Should the
         Consultancy terminate in any other circumstances, the Consultant shall
         not, subject to the absolute discretion of the Board, receive the said
         further payment but shall retain all payments received hereunder up to
         the Date of Cessation.

4.3      The Company shall be entitled to deduct from the Consultancy Fee (and
         any other sum due to the Consultant) any sums that the Consultant may
         owe the Company at any time.

5.       EXPENSES

         The Company shall reimburse the Consultant (within seven days of
         receipt of an appropriate invoice) all reasonable travelling, hotel and
         other expenses properly authorised by the Board and wholly, exclusively
         and necessarily incurred by the Consultant in providing the Services
         which expenses shall be evidenced in such manner as the Company may
         specify from time to time and for these purposes it shall be proper for
         the Consultant to use the same standard of travel and accommodation as
         authorised from time to time to any executive director of the Company.

6.       NON-COMPETE, NON-SOLICITATION

6.1      The Consultant covenants and agrees that, during the Consultancy and
         for the following periods after the termination of this Agreement
         howsoever arising (save with the prior written consent of the Board of
         the Company which shall not be unreasonably refused or delayed)
         directly or indirectly, either alone or jointly with or on behalf of
         any person, firm, company or entity and whether on his own account or
         as principal, partner, shareholder, director, employee, consultant or
         in any other capacity whatsoever, the Consultant shall not:

         (i)      for 12 months following termination in the Relevant Territory
                  (as defined in Clause 8(b) below) and in competition with the
                  Company or any of the Relevant Group Companies engage, assist
                  or be interested in any undertaking which provides
                  services/products similar to those provided by the Company or
                  any Relevant Group Companies;

         (ii)     for 12 months following termination in the Relevant Territory
                  solicit or interfere with or endeavour to entice away from the
                  Company or any of the Relevant Group Companies any person,
                  firm, company or entity who was a customer or potential
                  customer of the Company or any of the Relevant Group
                  Companies;

<PAGE>   5

         (iii)    for 12 months following termination in the Relevant Territory
                  be concerned with the supply of services/products to any
                  person, firm, company or entity which was a customer or
                  potential customer of the Company or any of the Relevant Group
                  Companies where such services/products are in competition with
                  those services/products supplied by the Company or any of the
                  Relevant Group Companies;

         (iv)     for 12 months following termination offer to employ or engage
                  or solicit the employment or engagement of any person who
                  immediately prior to the date of termination was an employee,
                  contractor or director of the Company or any of the Relevant
                  Group Companies (whether or not such person would commit any
                  breach of their contact of employment or engagement by reason
                  of leaving the service of such company);

         (v)      represent himself as being in any way connected with or
                  interested in the business of the Company or any of the
                  Relevant Group Companies other than in his capacity as a
                  shareholder of any such company; and

         (vi)     provided, however, that the provisions of Section 6.1(i), (ii)
                  and (iii) of this Section 6.1 shall only extend and shall only
                  be applicable to the extent that Consultant, directly or
                  indirectly, as an employee, director, officer, shareholder,
                  partner, or advisor, consultant or otherwise, engages in any
                  commercial activity or participates in any venture of any kind
                  that directly competes with the Company with respect to the
                  development, marketing, testing, manufacture or delivery of
                  women's contraception or estrogen replacement products within
                  the U.S., which are substantially similar to those of the
                  Company, and Consultant shall be free of the restrictions of
                  said Sections 6.1(i), (ii), and (iii) and shall be free at all
                  time to compete with the Company in any manner with respect to
                  any other products or business of the Company.

6.2      For the purposes of Clause 6:

         (i)      a "RELEVANT GROUP COMPANY" means the Company and all
                  subsidiary (as defined in clause 1) and associated companies
                  (as defined in clause 1) of the Company for which the
                  Consultant has performed services or in which he has held
                  office and, if applicable, their predecessors in business;

         (ii)     "RELEVANT TERRITORY" means the area constituting the market of
                  the Company or any of the Relevant Group Companies for
                  products and services with which the Executive shall have been
                  concerned during the term of his employment with the Company
                  and/or Warner Chilcott, Inc.; and

         (iii)    "POTENTIAL CUSTOMER" means any entity, person or otherwise
                  that the Company and any of the Relevant Group Companies has
                  actively solicited business during the 12 month period prior
                  to the Consultant's termination of consultancy.

6.3      Nothing contained in this Clause 6 shall prohibit the Consultant from
         holding shares or securities of a company any of whose shares or
         securities are quoted or traded on any recognised investment or stock
         exchange provided that any such holding shall not exceed three percent
         of the issued share capital of such a company and is held passively by
         way of bona fide investment only.

<PAGE>   6

6.4      If, at the time of enforcement of this clause 6 a court shall hold that
         the duration, scope or area restrictions stated herein are unreasonable
         under circumstances then existing, the parties agree that the maximum
         duration, scope or area reasonable under such circumstances shall be
         substituted for the stated duration, scope or area and that the court
         shall be allowed to revise the restrictions contained herein to cover
         the maximum period, scope and area permitted by law. The Consultant
         agrees that the restrictions contained in this clause 6 are reasonable.

6.5      In the event of the breach or a threatened breach by the Consultant of
         any of the provisions of this clause 6, the Company, in addition and
         supplementary to other rights and remedies existing in its favour, may
         apply to any court of law or equity of competent jurisdiction for
         specific performance and/or injunctive or other relief in order to
         enforce or prevent any violations of the provisions hereof (without
         posting of any bond).

7.       CONFIDENTIALITY

7.1      The Consultant shall not (whether before or after the Termination Date)
         except in the proper course of providing the Services or as required by
         law or as authorised by the Company use or communicate to any third
         party (and shall use his best endeavours to prevent the use or
         communication of) any trade or business secrets or confidential
         information of or relating to the Company or any Group Company
         concerning the business or finances or any dealings transactions or
         affairs of any Group Company.

7.2      The Consultant shall not make (other than for the benefit of the
         Company) any record (whether on paper, computer memory, disc or
         otherwise) relating to any matter within the scope of the business of
         the Company or any Group Company or their customers and suppliers or
         concerning any of its or their dealings or affairs or (either during
         the Consultancy or thereafter) use or permit to be used any such
         records other than for the benefit of the Company, it being agreed by
         the parties that all such records (and copies thereof) shall be the
         property of the Company and shall be handed over to the Chief Executive
         Officer of the Company by the Consultant on the Termination Date or (at
         the request of the Board) at any time during the Consultancy.

7.3      The Consultant shall not during the Consultancy either directly or
         indirectly publish any opinion, fact or material on any matter
         connected or relating to the business of the Company or any Group
         Company whether confidential or not without the prior written approval
         of the Company.

8.       INTELLECTUAL PROPERTY

         The Consultant agrees that any work prepared for the Company which is
         eligible for United States copyright protection or protection under the
         Universal Copyright Convention, the Berne Copyright Convention and/or
         the Buenos Aires Copyright Convention shall be a work made for hire and
         ownership of all copyrights (including all renewals and extensions)
         therein shall vest in the Company. If any such work is deemed not to be
         a work made for hire for any reason, the Consultant hereby grants,
         transfers and assigns all right, title and interest in such work and
         all copyrights in such work and all renewals and extensions thereof to
         the Company, and agrees to provide all assistance reasonably requested
         by the Company in the establishment, preservation and enforcement of
         the Company's copyright in such work, such

<PAGE>   7

         assistance to be provided at the Company's expense but without any
         additional compensation to the Consultant. The Consultant hereby agrees
         to and does hereby waive the enforcement of all moral rights with
         respect to the work developed or produced hereunder, including without
         limitation any and all rights of identification of authorship and any
         and all rights of approval, restriction or limitation on use or
         subsequent modifications.

9.       TERMINATION BY EVENTS OF DEFAULT

         The Company may at any time and without prejudice to any rights or
         claims it may have against the Consultant terminate the Consultancy by
         notice and with immediate effect and without any liability to pay any
         remuneration compensation or damages if at any time the Consultant:

         (i)      The Consultant's commission of any fraud, misappropriation or
                  gross and wilful misconduct which causes demonstrable injury
                  to the Company or a subsidiary or other Group Company;

         (ii)     An act of dishonesty by the Consultant resulting or intended
                  to result, directly or indirectly, in gain or personal
                  enrichment at the expense of the Company or a subsidiary or
                  other Group Company;

         (iii)    Conviction of, or a plea of nolo contendere with respect to a
                  non-vehicular felony or a crime involving moral turpitude;

         (iv)     Wilful or repeated failure to follow specific directives of
                  the Board to act or refrain from acting, which directives are
                  consistent with the Consultant's position; and

         (v)      Failure lasting at least 30 consecutive calendar days to
                  discharge his duties under this Agreement due to gross
                  negligence;

         any delay by the Company in exercising such right to terminate shall
         not constitute a waiver thereof.

10.      OBLIGATIONS UPON TERMINATION

         On the Termination Date the Consultant shall:

10.1     ensure that all rights in respect of work done and services rendered
         and the products thereof prior to the Termination Date shall remain
         vested absolutely in the Company; and

10.2     deliver to the Board all documents (including, but not limited to,
         correspondence, lists of clients or customers, plans, drawings,
         accounts and other documents of whatsoever nature and all copies
         thereof, whether on paper, computer memory or otherwise) made or
         compiled or acquired by the Consultant during the Consultancy and
         concerning the business, finances or affairs of the Company or any
         Group Company or its or their clients and any other property of any
         Group Company.

<PAGE>   8

11.      STATUS

11.1     The Consultant acknowledges that he will be an independent contractor
         of the Company and that nothing in this agreement shall render him an
         employee, agent or partner of the Company and he shall not hold himself
         out as such.

11.2     The Consultant covenants that he will be responsible for and shall pay
         all U.S. federal, state and local income and self-employment taxes,
         imposed by reason of his engagement hereunder and the receipt of the
         Consultancy Fee. The Consultant's covenants under this Section 11.2
         shall not affect the provisions of Section 4(h), (i), (j) and (k) of
         the Employment Agreement between the Consultant and the Company.

12.      NOTICES

         Any notice to be given hereunder shall be in writing. Notices may be
         given by either party by personal delivery or post or fax addressed to
         the other party at (in the case of the Company) its registered office
         for the time being and (in the case of the Consultant) his last known
         address and any such notice given by letter or fax shall be deemed to
         have been served at the time at which the letter was delivered
         personally or transmitted or (if sent by post) would have been
         delivered in the ordinary course of post.

13.      PREVIOUS CONTRACTS

13.1     Except for the obligations and agreements set forth in the Separation
         Agreement this agreement is in substitution for any previous
         arrangement between the Company or any Group Company and the Consultant
         which shall be deemed to have been terminated by mutual consent as from
         the commencement of the Consultancy. Nothing contained in this
         agreement shall in any way limit or diminish any amounts due to, or
         rights accruing to, Consultant under the Separation Agreement.

13.2     The Consultant hereby warrants and represents of the Company that he
         will not, in entering into this agreement or carrying out the Services,
         be in breach of any other obligation binding upon him.

14.      GENERAL

14.1     The provisions of schedules 1 and 2 hereto form part of this agreement
         which contains the whole of the terms agreed in respect of the
         Consultant's appointment as from the commencement of the Consultancy
         and this agreement shall only be capable of being varied by a
         supplemental agreement or memorandum in writing signed by or on behalf
         of the parties hereto.

14.2     The headings in this agreement are inserted for convenience only and
         shall not affect its construction.

14.3     Any reference to a statutory provision shall be construed as a
         reference to any statutory modification or re-enactment thereof
         (whether before or after the date hereof) for the time being in force.

<PAGE>   9

14.4     The schedules form part of and are incorporated into this agreement.

14.5     No modification, variation or amendment of this agreement shall be
         effective unless such modification, variation or amendment is in
         writing and has been signed by or on behalf of both parties.

15.      GOVERNING LAW

         Any dispute, controversy, proceedings or claim of whatever nature
         arising out of or relating to, or breach of, this agreement shall be
         governed by and this agreement shall be construed in all respects in
         accordance with the laws of the state of New Jersey in the United
         States of America.

16.      ASSIGNMENT AND SUB-CONTRACTING

         The Consultant shall not assign or sub-contract any of his rights or
         duties under this agreement without the consent in writing of the
         Company.

17.      WAIVER

         No waiver of any right hereunder at any time shall affect either
         party's right to claim any future entitlement to the same.

IN WITNESS whereof this agreement has been executed as a deed on the date first
above written.

Signed as a deed and delivered by         )
JAMES G ANDRESS in the presence of:       )           [JAMES G. ANDRESS] SIGNED
                                          )

Witness name:                                         James H. Ihrke

Witness address:                                      105 S. Waclar Drive
                                                      Chicago, IL. 60606

Signed as a deed by                       )
WARNER CHILCOTT PUBLIC                    )
LIMITED COMPANY acting by a               )
director and its secretary/two directors:

                                            Director [PAUL S. HERENDEEN] SIGNED

                                            Director/Secretary [ROGER
                                            BOISSONEAULT] SIGNED

<PAGE>   10

                                   SCHEDULE 1
                               THE RETAINED PERIOD

1.       Such periods as may be reasonably necessary for the Consultant to
         devote to the business of the Company or any Group Company to provide
         the Services provided however that the Consultant may not be required
         to devote (as aforesaid):

1.1      more than eight hours per day; or

1.2      more than 10 days per month.

2.       The actual days to be spent by the Consultant in providing the Services
         shall (wherever practicable) be agreed between the Company and the
         Consultant not less than one week in advance of each month of the
         Consultancy. In default of agreement between the parties as to the days
         so to be spent the Company shall be entitled to require the Consultant
         to provide services on such days as the Company may by not less than 14
         days' notice specify unless prior to such notice being given the
         Consultant shall have notified the Company that he shall be unavailable
         on such dates.

3.       If the Consultant is unable to work due to illness or injury on any day
         upon which it was agreed under paragraph 2 of this schedule that he
         would provide the Services he shall notify the Chief Executive Officer
         of the Company as soon as reasonably practicable stating:

3.1      the reason for his unavailability and the anticipated duration; and

3.2      (as soon as he knows) the date on which he is again available for work.

<PAGE>   11

                                   APPENDIX I
                     SEPARATION AGREEMENT AND MUTUAL RELEASE
                                  JAMES ANDRESS

2(a) Base Salary:  $350,000

2(c) Release and Covenants Lump Sum: $400,000

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00019-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00019-of-00352.parquet"}]]