PRACTICE WORKS INC
PROTECTIVE WARRANT
<DOCUMENT>
<TYPE>EX-10.24
<SEQUENCE>30
<FILENAME>g67664ex10-24.txt
<DESCRIPTION>PROTECTIVE WARRANT
<TEXT>

<PAGE>   1
                                                                   EXHIBIT 10.24


                               PROTECTIVE WARRANT

         THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
         ACT"), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN
         RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
         SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY
         NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
         ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED, HYPOTHECATED OR OTHERWISE
         DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
         UNDER THE SECURITIES ACT OR PURSUANT TO A TRANSACTION WHICH IS EXEMPT
         FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. THE HOLDER OF THIS
         CERTIFICATE IS THE BENEFICIARY OF CERTAIN OBLIGATIONS OF THE COMPANY
         SET FORTH IN A STOCK PURCHASE AGREEMENT, DATED AS OF MARCH 6, 2001,
         BETWEEN PRACTICEWORKS, INC. AND CRESCENT INTERNATIONAL LTD. A COPY OF
         THE PORTION OF THE AFORESAID AGREEMENT EVIDENCING SUCH OBLIGATIONS MAY
         BE OBTAINED FROM PRACTICEWORKS, INC.'S EXECUTIVE OFFICES.

                                                                          [DATE]

         Warrant to Purchase Shares of Common Stock of PracticeWorks, Inc.
(hereinafter a "Protective Warrant"), up to a total number determined in
accordance with Section 2(b) hereof.

         PracticeWorks, Inc., an entity organized and existing under the laws of
the State of Delaware (the "Company"), hereby agrees that Crescent International
Ltd. (the "Investor") or any other Warrant Holder is entitled, on the terms and
conditions set forth below, to purchase from the Company at any time during the
Exercise Period (as defined below) up to a total number, determined in
accordance with Section 2(b) hereof, of fully paid and nonassessable shares of
Common Stock, par value $0.01 per share, of the Company (the "Common Stock"), as
the same may be adjusted from time to time pursuant to Section 7 hereof, at the
Exercise Price (as defined below), as the same may be adjusted pursuant to
Section 7 hereof. The resale of the shares of Common Stock or other securities
issuable upon exercise or exchange of this Protective Warrant is subject to the
provisions of the Registration Rights Agreement (as defined below).

         Section 1.        Definitions.

                  "Aggregate Exercise Price" shall mean, with respect to any
exercise (in whole or in part) of this Protective Warrant, the Exercise Price
multiplied by the total number of shares of Common Stock for which this
Protective Warrant is being exercised.

                  "Agreement" shall mean the Stock Purchase Agreement, dated as
of March 6, 2001, between the Company and the Investor.

                  "Capital Shares" shall mean the Common Stock and any shares of
any other class of common stock whether now or hereafter authorized, having the
right to participate in the distribution of dividends (as and when declared) or
assets (upon liquidation of the Company).
<PAGE>   2

                  "Cash-Out Price" shall mean, with respect to any exercise (in
whole or in part) of this Protective Warrant, the product of (x) the Bid Price
of one share of Common Stock on the Trading Day immediately preceding the
Exercise Date multiplied by (y) the number of shares of Common Stock for which
the Company elects the Cash-Out Option.

                  "Exercise Date" shall mean with respect to any exercise (in
whole or in part) of this Protective Warrant either (i) the date this Protective
Warrant, the Exercise Notice and the Aggregate Exercise Price are received by
the Company or (ii) the date advanced copy of the Exercise Notice is sent by
facsimile to the Company, provided that this Protective Warrant, the original
Exercise Notice, and the Aggregate Exercise Price are received by the Company
within five Trading Days thereafter and provided further that if this Protective
Warrant the original Exercise Notice and the Aggregate Exercise Price are not
received within five Trading Days in accordance with clause (ii) above, the
Exercise Date for this clause (ii) shall be the date that the Company receives
this Protective Warrant, the original Exercise Notice and the Aggregate Exercise
Price.

                  "Exercise Notice" shall mean with respect to any exercise (in
whole or in part) of this Protective Warrant the exercise form attached hereto
as Exhibit A, duly executed by the Warrant Holder.

                  "Exercise Period" shall mean the period beginning on the
Effective Date applicable to the corresponding Sale and continuing until the
two-year period thereafter; provided that such period shall be extended one day
for each day after such Effective Date, that any Registration Statement is not
effective during the period the Registration Statement is required to be
effective pursuant to the Registration Rights Agreement.

                  "Exercise Price" as of the date hereof shall mean $0.01 per
share of Common Stock, subject to the adjustments provided for in Section 7 of
this Protective Warrant.

                  "Per Share Protective Warrant Value" shall mean, with respect
to any exercise (in whole or in part) of this Protective Warrant, the difference
resulting from subtracting the Exercise Price from the Bid Price of one share of
Common Stock on the Trading Day immediately preceding the Exercise Date.

                  "Registration Rights Agreement" shall mean the registration
rights agreement, dated March 6, 2001 between the Company and the Investor.

                  "Warrant Holder" shall mean the Investor or any assignee or
transferee of all or any portion of this Protective Warrant.

                  Other capitalized terms used but not defined herein shall have
their respective meanings set forth in the Agreement.

         Section 2.        Exercisability.

                  (a) Timing. If the Purchase Price on the Effective Date
applicable to the corresponding Sale is lower than the Purchase Price on the
Sale Date with respect to such Sale, this Protective Warrant shall become
immediately exercisable, subject to clause (c) below.

                  (b) Number of Shares. The number of shares of Common Stock for
which this Protective Warrant is exercisable (the "Protective Warrant Shares")
shall be determined by


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<PAGE>   3

subtracting (x) the Investment Amount with respect to the applicable Sale
divided by the Purchase Price on the Sale Date from (y) the Investment Amount
with respect to the applicable Sale divided by the Purchase Price on the
Effective Date applicable to the Sale Date.

                  (c) Cash Payment in Lieu of Issuance of Shares. In the event
that the Warrant Holder exercises this Protective Warrant (in whole or in part)
in accordance with Section 3 hereof, then the Company may, in lieu of issuing
shares of Common Stock pursuant to such exercise, pay to the Investor the
Cash-Out Price for any or all of the shares of Common Stock purchasable by the
Investor through the exercise of this Protective Warrant (such payment, the
"Cash-Out Option"). For avoidance of doubt, the Company may elect such Cash-Out
Option in the event that, inter alia, the number of Protective Warrant Shares
plus the number of First Sale Shares and Subsequent Sale Shares exceeds the
number of shares registered pursuant to Section 1.1(a) of the Registration
Rights Agreement.

                  (d) Notice of Cash Payment in Lieu of Issuance of Shares. In
the event that the Company elects the "Cash-Out Option" the Company shall
promptly give notice to the Investor of such election on the Trading Day
following surrender of the items described in Section 3(a)(i) or delivery by
facsimile of the Exercise Notice described in Section 3(a)(ii). Such notice from
the Company shall set forth the number of shares of Common Stock for which the
Company elects the Cash-Out Option.

                  (e) Method of Cash-Out; Effect of Cash-Out. In the event that
the Company elects the Cash-Out Option, then in lieu of delivering stock
certificates as provided in Section 5 hereof, the Company shall deliver by wire
transfer of immediately available funds to an account designated by the Investor
as soon as practicable after delivery by the Company of notice of its election
of the Cash-Out Option and in any event within two Trading Days thereafter, the
Cash-Out Price for any and all shares of Common Stock for which the Company
elects the Cash-Out Option.

         Section 3.        Exercise; Cashless Exercise.

                  (a) Method of Exercise. This Protective Warrant may be
exercised in whole or in part (but not as to a fractional share of Common
Stock), at any time and from time to time during the Exercise Period, by the
Warrant Holder by (i) the surrender of this Protective Warrant, the Exercise
Notice and the Aggregate Exercise Price to the Company at the address set forth
in Section 12 hereof or (ii) the delivery by facsimile of an executed and
completed Exercise Notice to the Company and delivery to the Company within five
Trading Days thereafter of this Protective Warrant, the original Exercise Notice
and the Aggregate Exercise Price.

                  (b) Payment of Aggregate Exercise Price. Subject to paragraph
(c) below, payment of the Aggregate Exercise Price shall be made by check or
bank draft payable to the order of the Company or by wire transfer to an account
designated by the Company. If the amount of the payment received by the Company
is less than the Aggregate Exercise Price, the Warrant Holder will be notified
of the deficiency and shall make payment in that amount within five Trading Days
of such notice. In the event the payment exceeds the Aggregate Exercise Price,
the Company will refund the excess to the Warrant Holder within three Trading
Days of both the receipt of such payment and the knowledge of such excess.


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<PAGE>   4

                  (c) Cashless Exercise. As an alternative to payment of the
Aggregate Exercise Price in accordance with Section 3(b) above, the Warrant
Holder may elect to effect a cashless exercise by so indicating on the Exercise
Notice and including a calculation of the number of shares of Common Stock to be
issued upon such exercise in accordance with the terms hereof (a "Cashless
Exercise"). In the event of a Cashless Exercise, the Warrant Holder shall
surrender this Protective Warrant for that number of shares of Common Stock
determined by (i) multiplying the number of Protective Warrant Shares for which
this Protective Warrant is being exercised by the Per Share Protective Warrant
Value and (ii) dividing the product by the Bid Price of one share of the Common
Stock on the Trading Day immediately preceding the Exercise Date.

                  (d) Replacement Protective Warrant. In the event that the
Protective Warrant is not exercised in full, the number of Protective Warrant
Shares shall be reduced by the number of such Protective Warrant Shares for
which this Protective Warrant is exercised, and the Company, at its expense,
shall forthwith issue and deliver to the Warrant Holder a new Protective Warrant
of like tenor in the name of the Warrant Holder or as the Warrant Holder may
request, reflecting such adjusted number of Protective Warrant Shares.

         Section 4.        Ten Percent Limitation. At no time may the Warrant
Holder exercise this Protective Warrant such that the number of Protective
Warrant Shares to be received pursuant to such exercise aggregated with all
other shares of Common Stock then owned by the Warrant Holder beneficially or
deemed beneficially owned (as such term is defined in Rule 13(d) under the
Exchange Act) by the Warrant Holder and its affiliates would result in the
Warrant Holder and its affiliates owning more than 9.9% of all of such Common
Stock as would be outstanding on such Exercise Date, as determined in accordance
with Section 13(d) of the Exchange Act and the rules and regulations promulgated
thereunder.

         Section 5.        Delivery of Stock Certificates.

                  (a) Subject to the terms and conditions of this Protective
Warrant, as soon as practicable after the exercise of this Protective Warrant in
full or in part, and in any event within five Trading Days thereafter, the
Company at its expense (including, without limitation, the payment by it of any
applicable issue taxes) will cause to be issued in the name of and delivered to
the Warrant Holder, or as the Warrant Holder lawfully may direct, a certificate
or certificates for the number of validly issued, fully paid and non-assessable
Protective Warrant Shares to which the Warrant Holder shall be entitled on such
exercise, together with any other stock or other securities or property
(including cash, where applicable) to which the Warrant Holder is entitled upon
such exercise in accordance with the provisions hereof; provided, however, that
any such delivery to a location outside of the United States also shall be made
within five Trading Days after the exercise of this Protective Warrant in full
or in part.

                  (b) This Protective Warrant may not be exercised as to
fractional shares of Common Stock. In the event that the exercise of this
Protective Warrant, in full or in part, would result in the right to acquire any
fractional share of Common Stock, then in such event such fractional share shall
be considered a whole share of Common Stock and shall be added to the number of
Protective Warrant Shares issuable to the Investor upon exercise of this
Protective Warrant.


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<PAGE>   5

         Section 6.        Representations, Warranties and Covenants of the
Company.

                  (a) The Company shall take all necessary action and
proceedings as may be required and permitted by applicable law, rule and
regulation for the legal and valid issuance of this Protective Warrant and the
Protective Warrant Shares to the Warrant Holder.

                  (b) At all times during the Exercise Period, the Company shall
take all steps reasonably necessary and within its control to insure that the
Common Stock remains listed or quoted on the Principal Market.

                  (c) The Protective Warrant Shares, when issued in accordance
with the terms hereof, will be duly authorized and, when paid for or issued in
accordance with the terms hereof, shall be validly issued, fully paid and
non-assessable.

                  (d) The Company has authorized and reserved for issuance to
the Warrant Holder the requisite number of shares of Common Stock to be issued
pursuant to this Protective Warrant. The Company at all times shall reserve and
keep available, solely for issuance and delivery as Protective Warrant Shares
hereunder, such shares of Common Stock as from time to time shall be issuable as
Protective Warrant Shares, and accordingly shall adjust the number of such
shares of Common Stock promptly upon the occurrence of any of the events
specified in Section 7 hereof.

         Section 7.        Adjustment of the Exercise Price. The Exercise Price
and, accordingly, the number of Protective Warrant Shares issuable upon exercise
of the Protective Warrant, shall be subject to adjustment from time to time upon
the happening of certain events as follows:

                  (a) Reclassification, Consolidation, Merger or Mandatory Share
Exchange; Sale, Transfer or Lease of Assets. If the Company, at any time while
this Protective Warrant is unexpired and not exercised in full, (i) reclassifies
or changes its Outstanding Capital Shares (other than a change in par value, or
from par value to no par value per share, or from no par value per share to par
value, or as a result of a subdivision or combination of outstanding securities
issuable upon exercise of this Protective Warrant) or (ii) consolidates, merges
or effects a mandatory share exchange (x) with or into another corporation
(other than a merger or mandatory share exchange with another corporation in
which the Company is a continuing corporation and that does not result in any
reclassification or change, other than a change in par value, or from par value
to no par value per share, or from no par value per share to par value) or (y)
as a result of a subdivision or combination of Outstanding Capital Shares
issuable upon exercise of this Protective Warrant or (iii) sells, transfers or
leases all or substantially all of its assets, then in any such event the
Company, or such successor or purchasing corporation, as the case may be, shall,
without payment by the Warrant Holder of any additional consideration therefor
amend this Protective Warrant or issue a new warrant providing that the Warrant
Holder shall have rights not less favorable to the Warrant Holder than those
then applicable to this Protective Warrant and to receive upon exercise under
such amendment of this Protective Warrant or new warrant, in lieu of each share
of Common Stock theretofore issuable upon exercise of this Protective Warrant
hereunder, the kind and amount of shares of stock, other securities, money or
property receivable upon such reclassification, change, consolidation, merger,
mandatory share exchange, lease, sale or transfer by the holder of one share of
Common


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<PAGE>   6

Stock issuable upon exercise of this Protective Warrant had this Protective
Warrant been exercised immediately prior to such reclassification, change,
consolidation, merger, mandatory share exchange or sale or transfer (without
giving effect to the limitation on ownership set forth in Section 4 hereof) and
an appropriate provision for the foregoing shall be made by the Company as part
of any such event. Such amended Protective Warrant or new warrant shall provide
for adjustments that shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Section 7. The provisions of this Section 7(a)
shall similarly apply to successive reclassifications, changes, consolidations,
mergers, mandatory share exchanges, sales, transfers and leases.

                  (b) Subdivision or Combination of Shares; Stock Dividends. If
the Company, at any time while this Protective Warrant is unexpired and not
exercised in full, shall subdivide its Common Stock, combine its Common Stock,
pay a dividend in its Capital Shares, or make any other distribution of its
Capital Shares, then the Exercise Price shall be adjusted, as of the date the
Company shall take a record of the holders of its Capital Shares for the purpose
of effecting such subdivision, combination or dividend or other distribution (or
if no such record is taken, as of the effective date of such subdivision,
combination, dividend or other distribution), to that price determined by
multiplying the Exercise Price in effect immediately prior to such subdivision,
combination, dividend or other distribution by a fraction:

                           (i)      the numerator of which shall be the total
number of Outstanding Capital Shares immediately prior to such subdivision,
combination, dividend or other distribution, and

                           (ii)     the denominator of which shall be the total
number of Outstanding Capital Shares immediately after such subdivision,
combination, dividend or other distribution. The provisions of this Section 7(b)
shall not apply under any of the circumstances for which an adjustment is made
pursuant to Section 7(a).

                  (c) Liquidating Dividends, Etc. If the Company, at any time
while this Protective Warrant is unexpired and not exercised in full, makes a
distribution of its assets or evidences of indebtedness to the holders of its
Capital Shares as a dividend in liquidation or by way of return of capital or
other than as a dividend payable out of earnings or surplus legally available
for dividends under applicable law or any distribution to such holders made in
respect of the sale of all or substantially all of the Company's assets, or any
spin-off of any of the Company's lines of business, divisions or subsidiaries
(other than under the circumstances provided for in the foregoing subsections
(a) and (b)), then the Warrant Holder shall be entitled to receive upon such
exercise of the Protective Warrant in addition to the Protective Warrant Shares
receivable in connection therewith, and without payment of any consideration
other than the Exercise Price, an amount in cash equal to the value of such
distribution per Capital Share multiplied by the number of Protective Warrant
Shares that, on the record date for such distribution, are issuable upon such
exercise of the Protective Warrant (without giving effect to the limitation on
ownership set forth in Section 4 hereof), and an appropriate provision therefor
shall be made by the Company as part of any such distribution. No further
adjustment shall be made following any event that causes a subsequent adjustment
in the number of Protective Warrant Shares issuable. The value of a distribution
that is paid in other than cash shall be determined in good faith by the Board
of Directors of the Company.


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<PAGE>   7

                  (d) Adjustment of Number of Shares. Upon each adjustment of
the Exercise Price pursuant to any provisions of this Section 7, the number of
Protective Warrant Shares issuable hereunder at the option of the Warrant Holder
shall be calculated, to the nearest one hundredth of a whole share, multiplying
the number of Protective Warrant Shares issuable prior to an adjustment by a
fraction:

                           (i)      the numerator of which shall be the Exercise
Price before any adjustment pursuant to this Section 7; and

                           (ii)     the denominator of which shall be the
Exercise Price after such adjustment.

                  (e) Other Action Affecting Capital Shares. In the event after
the date hereof the Company shall take any action affecting the number of
Outstanding Capital Shares, other than an action specifically described in any
of the foregoing subsections (a) through (c) hereof, inclusive, (including
without limitation a subdivision or combination of Common Stock, or the payment
of a dividend in its Capital Shares or any other distribution), that in the
reasonable opinion of the Warrant Holder would have a materially adverse effect
upon the rights of the Warrant Holder at the time of exercise of the Protective
Warrant, the Exercise Price shall be adjusted in such manner and at such time as
the Board of Directors on the advice of the Company's independent public
accountants shall in good faith determine to be equitable in the circumstances.

                  (f) Notice of Certain Actions. In the event the Company shall,
at a time while the Protective Warrant is unexpired and outstanding, take any
action pursuant to subsections (a) through (e) of this Section 7 that may result
in an adjustment of the Exercise Price, the Company shall notify the Warrant
Holder of such action 10 days in advance of its effective date in order to
afford to the Warrant Holder an opportunity to exercise the Protective Warrant
prior to such action becoming effective.

                  (g) Notice of Adjustments. Whenever the Exercise Price or
number of Protective Warrant Shares shall be adjusted pursuant to Section 7
hereof, the Company shall promptly deliver by facsimile with the original
delivered by express courier service in accordance with Section 12 hereof; a
certificate, which shall be signed by the Company's President or a Vice
President and by its Treasurer or Assistant Treasurer or its Secretary or
Assistant Secretary, setting forth in reasonable detail the event requiring the
adjustment, the amount of the adjustment, the method by which such adjustment
was calculated (including a description of the basis on which the Company's
Board of Directors made any determination hereunder), and the Exercise Price and
number of Protective Warrant Shares purchasable at that Exercise Price after
giving effect to such adjustment.

         Section 8.        No Impairment. The Company will not, by amendment of
its Certificate or By-Laws 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 this Protective Warrant, but will at all times in good faith assist
in the carrying out of all such terms and in the taking of all such action as
may be necessary or appropriate in order to protect the rights of the Warrant
Holder against impairment. Without limiting the generality of the foregoing, the
Company (a) will not increase the par value


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<PAGE>   8

of any Protective Warrant Shares above the amount payable therefor on such
exercise, and (b) will take all such action as may be reasonably necessary or
appropriate in order that the Company may validly and legally issue fully paid
and nonassessable Protective Warrant Shares on the exercise of this Protective
Warrant.

         Section 9.        Rights As Stockholder. Prior to exercise of this
Protective Warrant and except as provided in Section 7 hereof, the Warrant
Holder shall not be entitled to any rights as a stockholder of the Company with
respect to the Protective Warrant Shares, including (without limitation) the
right to vote such shares, receive dividends or other distributions thereon or
be notified of stockholder meetings. However, in the event of any taking by the
Company of a record of the holders of any class of securities for the purpose of
determining the holders thereof who are entitled to receive any dividend (other
than a cash dividend) or other distribution, any right to subscribe for,
purchase or otherwise acquire any shares of stock of any class or any other
securities or property, or to receive any other right, the Company shall mail to
each Warrant Holder, at least ten days prior to the date specified therein, a
notice specifying the date on which any such record is to be taken for the
purpose of such dividend, distribution or right, and the amount and character of
such dividend, distribution or right.

         Section 10.       Replacement of Protective Warrant. Upon receipt of
evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of the Protective Warrant and, in the case of any such loss, theft
or destruction of the Protective Warrant, upon delivery of an indemnity
agreement or security reasonably satisfactory in form and amount to the Company
or, in the case of any such mutilation, on surrender and cancellation of such
Protective Warrant, the Company at its expense will execute and deliver, in lieu
thereof, a new Protective Warrant of like tenor.

         Section 11.       Restricted Securities.

                  (a) Registration or Exemption Required. This Protective
Warrant has been issued in a transaction exempt from the registration
requirements of the Securities Act in reliance upon Section 4(2) of the
Securities Act. This Protective Warrant and the Protective Warrant Shares
issuable upon exercise of this Protective Warrant may not be resold except
pursuant to an effective registration statement or an exemption to the
registration requirements of the Securities Act and applicable state laws.

                  (b) Legend. Any replacement Protective Warrants issued
pursuant to Section 2 hereof and any Protective Warrant Shares issued upon
exercise hereof, shall bear the following legend:

                  "THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE
                  NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
                  1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY OTHER
                  APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN
                  RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION
                  REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER
                  SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY
                  INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED,


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<PAGE>   9

                  SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED,
                  HYPOTHECATED OR OTHERWISE DISPOSED OF, EXCEPT
                  PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
                  THE SECURITIES ACT OR PURSUANT TO A TRANSACTION WHICH
                  IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
                  THE HOLDER OF THIS CERTIFICATE IS THE BENEFICIARY OF
                  CERTAIN OBLIGATIONS OF THE COMPANY SET FORTH IN A
                  STOCK PURCHASE AGREEMENT, DATED AS OF MARCH 6, 2001,
                  BETWEEN PRACTICEWORKS, INC. AND CRESCENT
                  INTERNATIONAL LTD. A COPY OF THE PORTION OF THE
                  AFORESAID AGREEMENT EVIDENCING SUCH OBLIGATIONS MAY
                  BE OBTAINED FROM THE PRACTICEWORKS, INC.'S EXECUTIVE
                  OFFICES."

                      Removal of such legend shall be in accordance with the
     legend removal provisions in the Agreement.

                  (c) No Other Legend or Stock Transfer Restrictions. No legend
other than the one specified in paragraph (b) of this Section 11 has been or
shall be placed on the share certificates representing the Protective Warrant
Shares and no instructions or "stop transfer orders," so called, "stock transfer
restrictions" or other restrictions have been or shall be given to the Company's
transfer agent with respect thereto other than as expressly set forth in this
Section 11.

                  (d) Assignment. Assuming the conditions of Section 11(a) above
regarding registration or exemption have been satisfied, the Warrant Holder may
sell, transfer, assign, pledge or otherwise dispose of this Protective Warrant,
in whole or in part. The Warrant Holder shall deliver a written notice to the
Company substantially in the form of the assignment form attached hereto as
Exhibit B (the "Assignment Notice"), indicating the person or persons to whom
this Protective Warrant shall be assigned and the respective number of warrants
to be assigned to each assignee. The Company shall effect the assignment within
ten (10) days of receipt of such Assignment Notice, and shall deliver to the
assignee(s) designated by the Warrant Holder a Protective Warrant or Protective
Warrants of like tenor and terms for the specified number of shares.

                  (e) Investor's Compliance. Nothing in this Section 11 shall
affect in any way the Investor's obligations under any agreement to comply with
all applicable securities laws upon resale of the Common Stock.

         Section 12.       Notices. All notices, demands, requests, consents,
approvals, and other communications required or permitted hereunder shall be in
writing and shall be deemed duly given (i) upon delivery if hand delivered at
the address designated below (if delivered on a business day during normal
business hours where such notice is to be received) or the first business day
following such delivery (if delivered other than on a business day during normal
business hours where such notice is to be received), (ii) on the fifth business
day after deposit into the mail, if deposited in the mail, registered or
certified, return receipt requested, postage prepaid, addressed to the address
designated below, (iii) upon delivery delivered by reputable express courier
service to the address designated below, or (iv) upon confirmation of


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<PAGE>   10

transmission if transmitted by facsimile to the facsimile number designated
below (if delivered on a business day during normal business hours where such
notice is to be received), or the first business day following such delivery (if
delivered other than on a business day during normal business hours where such
notice is to be received). The addresses and facsimile numbers for such
communications shall be:

         if to the Company:

                        PracticeWorks, Inc.
                        1765 The Exchange, Suite 300
                        Atlanta, GA 30339
                        Attention:  Richard E. Perlman
                        Telephone:  (770) 850-5006
                        Facsimile:  (770) 857-1300

         with a copy (which shall not constitute notice) to:

                        King & Spalding
                        191 Peachtree Street
                        Atlanta, GA 30303
                        Attention:  John J. Kelley III
                        Telephone:  (404) 572-4600
                        Facsimile:  (404) 572-5100

         if to the Investor:

                        Crescent International Ltd.
                        c/o GreenLight (Switzerland) SA
                        84, av Louis-Casai
                        P.O. Box 42
                        1216 Geneva, Cointrin
                        Switzerland
                        Attention:  Mel Craw/Maxi Brezzi
                        Telephone:  +41 22 791 71 69
                        Facsimile:  +41 22 929 53 94

         with a copy (which shall not constitute notice) to:

                        Clifford Chance Rogers & Wells LLP
                        200 Park Avenue
                        New York, NY 10166
                        Attention:  Sara P. Hanks, Esq./Earl S. Zimmerman, Esq.
                        Telephone:  (212) 878-8000
                        Facsimile:  (212) 878-8375

                  Either party hereto may from time to time change its address
or facsimile number for notices under this Section 12 by giving at least ten
(10) days' prior written notice of such changed address or facsimile number to
the other party hereto.

         Section 13.       Miscellaneous. This Protective Warrant and any term
hereof may be changed, waived, discharged or terminated only by an instrument in
writing signed by the party


                                       10
<PAGE>   11

against which enforcement of such change, waiver, discharge or termination is
sought. The headings in this Protective Warrant are for purposes of reference
only, and shall not limit or otherwise affect any of the terms hereof. The
invalidity or unenforceability of any provision hereof shall in no way affect
the validity or enforceability of any other provision.


                                       11
<PAGE>   12

                  IN WITNESS WHEREOF, this Protective Warrant was duly executed
by the undersigned, thereunto duly authorized, as of the date first set forth
above.



PRACTICEWORKS, INC.



By:
    -----------------------------------------------------
    Name:
    Title:


Attested:



By:
    -----------------------------------------------------
    Name:
    Title:   Secretary
<PAGE>   13

                       EXHIBIT A TO THE PROTECTIVE WARRANT

                                  EXERCISE FORM

                               PRACTICEWORKS, INC.

The undersigned (the "Registered Holder") hereby irrevocably exercises the right
to purchase __________________ shares of Common Stock of PracticeWorks, Inc., an
entity organized and existing under the laws of the State of Delaware (the
"Company"), evidenced by the attached Protective Warrant, and herewith makes
payment of the Exercise Price with respect to such shares in full in the form of
(check the appropriate box) (i) Ycash or certified check in the amount of
$________; (ii) Ywire transfer to the Company's account at __________________,
_________, _________ (Account No.:_________); or (iii) Y ______ Protective
Warrant Shares, which represent the amount of Protective Warrant Shares as
provided in the attached Protective Warrant to be canceled in connection with
such exercise, all in accordance with the conditions and provisions of said
Protective Warrant.

The undersigned requests that stock certificates for such Protective Warrant
Shares be issued, and a Protective Warrant representing any unexercised portion
hereof be issued, pursuant to this Protective Warrant in the name of the
registered Registered Holder and delivered to the undersigned at the address set
forth below.


Dated:
      -----------------------------------------



-----------------------------------------------
Signature of Registered Holder


-----------------------------------------------
Name of Registered Holder (Print)



-----------------------------------------------
Address
<PAGE>   14

                                     NOTICE

         The signature to the foregoing Exercise Form must correspond to the
name as written upon the face of the attached Protective Warrant in every
particular, without alteration or enlargement or any change whatsoever.
<PAGE>   15

                       EXHIBIT B TO THE PROTECTIVE WARRANT

                                   ASSIGNMENT


         (To be executed by the registered Warrant Holder (the "Registered
Holder") desiring to transfer the Protective Warrant, in whole or in part.)

         FOR VALUED RECEIVED, the undersigned Warrant Holder of the attached
Protective Warrant hereby sells, assigns or transfers unto the person(s) named
below (the "Assignee") the right to purchase ______________ shares of the Common
Stock of PracticeWorks, Inc. evidenced by the attached Protective Warrant and
does hereby irrevocably constitute and appoint ______________________ (attorney)
to transfer the number of shares specified of the said Protective Warrant on the
books of the Company, with full power of substitution in the premises.

         The undersigned requests that such Protective Warrant be issued, and a
Protective Warrant representing any unsold, unassigned or non-transferred
portion hereof be issued, pursuant to this Protective Warrant in the name of the
Registered Holder and delivered to the undersigned at the address set forth
below.

Dated:
      --------------------------------------------



--------------------------------------------------
Signature of Registered Holder


--------------------------------------------------
Name of Registered Holder (Print)



--------------------------------------------------
Address of Registered Holder


--------------------------------------------------
Name of Assignee (Print)



--------------------------------------------------
Address of Assignee (including zip code number)
<PAGE>   16

Fill in for new Registration of Protective Warrant:



--------------------------------------------------
Name


--------------------------------------------------
Address


--------------------------------------------------
Please print name and address of assignee
        (including zip code number)
<PAGE>   17

                                     NOTICE

         The signature to the foregoing Assignment must correspond to the name
as written upon the face of the attached Protective Warrant in every particular,
without alteration or enlargement or any change whatsoever.
</TEXT>
</DOCUMENT>
