Monday April 6, 11:32 Company Press Release Explains the Warrants exchange and preferred stock repurchase:
Medix Resources Repurchases Convertible Preferred Stock, Exchanges Warrants for Common
Stock
DENVER--(BW HealthWire)--April 6, 1998--Medix Resources, Inc. (Nasdaq: MDIX - news), formerly International Nursing Services, Inc., today announced
that it has signed an agreement with two private investors which will allow Medix to repurchase 80 of its outstanding units of convertible preferred stock and
warrants from the 1997 private placement for $800,000 at face value over the next five months. This agreement also allows these investors the option to convert to
common stock any balance owed in September 1998. Prior to this transaction, there were approximately 100 convertible preferred units outstanding, or $1.0 million
of convertible preferred stock, from the 1997 private placement. The 1997 issue of preferred stock allowed investors to convert the preferred stock into common
stock at 75% of market price. This agreement eliminates those conversion rights. Also, the convertible preferred stock carries no dividend.
Additionally, the company today announced it exchanged 1,402,000 warrants from the 1996 and 1997 private placements for 174,500 newly issued shares of the
company's common stock. Together with the above repurchase, these transactions reduce outstanding warrants by 2,202,000. Prior to these transactions, there
were approximately 3.5 million warrants outstanding from the 1996 and 1997 private placements, exercisable at $0.625 and $1.00, respectively. The company
intends to redeem additional warrants issued from the 1996 and 1997 private placements under terms similar to the recently completed exchange.
John P. Yeros, chairman of the company, stated, ''The combination of the warrants exchanged and the warrants repurchased eliminates two- thirds of all of the
outstanding warrants from the 1996 and 1997 private placements. It has been our continued objective to simplify our capital structure in an effort to achieve our
business initiatives. We believe both the exchange of warrants and the repurchase of convertible preferred stock supports this objective, while at the same time
effectively eliminates conversions and share dilution. This agreement is in the best interest of the company and its shareholders.''
Medix Resources, Inc. is a healthcare services company with two synergistic lines of business. The company provides skilled nursing, therapy, rehabilitation and
other medical personnel for flexible staffing in home care, and in a broad spectrum of healthcare and educational facilities. Through its wholly owned subsidiary,
Cymedix Lynx Corporation, the company also offers Cymedix Lynx, a secure, patent-pending medical communications product that makes use of the Internet to
facilitate more cost-efficient patient care.
''Safe Harbor'' Statement under the Private Securities Litigation Reform Act of 1995: The statements contained in this release which are not historical facts contain
forward-looking information with respect to plans, projections and/or future performance of the Company, the occurrence of which involve certain risks and
uncertainties detailed in the Company's Form 10K-SB for 1997 that was filed with the Securities and Exchange Commission on March 30, 1998. |
