X0202 4/A 2006-09-30 2006-10-04 0000921878 FAMILYMEDS GROUP, INC. FMRX 0001176482 MEDCAP PARTNERS LP 500 THIRD STREET #535 SAN FRANCISCO CA 94107 0 0 1 0 0001274204 TONEY C FRED 500 THIRD STREET #535 SAN FRANCISCO CA 94107 0 0 0 1 See footnote 1 Warrant to Purchase Common Stock 10.90 2006-09-30 4 J 0 24708 0 D 2010-10-02 Common Stock 24708 433849 I See footnotes The securities reported on this Form 4 (warrants exercisable for shares of the issuer's common stock) are held by: (i) MedCap Partners L.P. ("MedCap Partners"); and (ii) an offshore investment limited partnership (the "Offshore Fund"). MedCap Management & Research LLC ("MMR"), a registered investment advisor, is the general partner and investment manager of both MedCap Partners and the Offshore Fund. C. Fred Toney is the managing member of MMR, and Mr. Toney also holds, directly and indirectly, certain limited partnership interests in MedCap Partners. On September 30, 2006, MMR segregated a portion of the issuer's securities held by MedCap Partners into a separate account for the benefit of certain of its previous limited partners. The segregation was originally reported on a Form 4 filed on October 4, 2006 (the "Original Form 4"). The Original Form 4 reported that the segregation of the warrants occurred on October 2, 2006 (in column 3 of Table II); as noted here, however, the effective date of the segregation was September 30, 2006. The Original Form 4 also listed the number of derivative securities and the amount of underlying shares segregated by MMR as 258,247 (in columns 5 and 7 of Table II); as noted here, the correct number was 24,708. All of the share data reported in this Form 4 takes into account a 1-for-10 reverse stock split by the issuer effectve August 16, 2006. The Original Form 4 reported the number of derivative securities beneficially owned following the segregation as 437,949 (in column 9 of Table II); as noted here, the correct number was 433,849. Of these, warrants to purchase 390,455 shares of the issuer's common stock are beneficially held by MedCap Partners, and the balance is beneficially held by the Offshore Fund. The warrants became formally exercisable on April 3, 2006, but they are subject to restrictions that prohibit their exercise to the extent that the number of shares of the issuer's common stock beneficially owned by MedCap Partners, the Offshore Fund, their respective affiliates and other persons whose beneficial ownership is aggregated with them would exceed 9.999% of the total number of issued and outstanding shares of the issuer's common stock (including for such purpose the share of common stock issuable upon such exercise). As noted in the Original Form 4, because Mr. Toney, as the managing member of MMR, may be deemed to be a "control person" who, for the purposes of Rule 16a-1(a)(1)(vii), may be deemed to hold in excess of 1% of the issuer's common stock indirectly through his limited partnership interests in MedCap Partners, Mr. Toney has elected to voluntarily file this Form 4 as a co-reporting person to report the aggregate holdings of, and certain transactions by, MedCap Partners and the Offshore Fund. Mr. Toney's election to file this Form 4 should not be construed as an admission of his status as such a control person, or as a 10% beneficial owner of the issuer's common stock for Section 16 purposes. In any event, each of MMR and Mr. Toney expressly disclaims beneficial ownership in these securities, except to the extent of their respective pecuniary interests therein. MedCap Partners L.P.; By: MedCap Management & Research LLC, its General Partner; By: C. Fred Toney, its Managing Member; /s/ C. Fred Toney 2006-11-17 C. Fred Toney; /s/ C. Fred Toney 2006-11-17