Exhibit 1(b)
                                                                    ------------


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                                     WARRANT



                  To Purchase         Shares of Common Stock of
                             ---------


                                 UNIDIGITAL INC.















                                                              , 19
                                               ------------ --    --


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                                  Exhibit 1(b)
                                  ------------
<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

1.   Definitions..............................................................2

     1.1.   Definitions of Terms..............................................2
     1.2.   Other Definitions.................................................5

2.   Exercise of Warrant......................................................5

     2.1.   Right to Exercise; Notice.........................................5
     2.2.   Manner of Exercise; Issuance of Common Stock......................5
     2.3.   Effectiveness of Exercise.........................................7
     2.4.   Continued Validity................................................7
     2.5.   Automatic Exercise on Last Day of Exercise Period.................7

3.   Registration, Transfer, Exchange and Replacement of Securities;
     Legends..................................................................8

     3.1.   Registration, Transfer, Exchange and Replacement of Securities....8
     3.2.   Transfers and Legends.............................................8

4.   Anti-Dilution Provisions.................................................9

     4.1.   Adjustment of Number of Shares Purchasable........................9
     4.2.   Adjustment of Exercise Price......................................9
     4.3.   Rights Offering..................................................18
     4.4.   Certificates and Notices.........................................18
     4.5.   Adjustments for Changes in Certain Data..........................19

5.   Repurchase; Registration; Transfer Restrictions, etc....................19

6.   Reservation of Common Stock.............................................20

7.   Various Covenants of the Holding Company................................20

     7.1.   No Impairment or Amendment; No Further Issuances or Sales;
            Continued Validity...............................................20
     7.2.   Listing on Securities Exchanges, etc.............................21
     7.3.   Anti-Dilution Provisions.........................................21
     7.4    Indemnification..................................................21
     7.5.   Certain Expenses.................................................21



                                  Exhibit 1(b)
                                  ------------
<PAGE>

8.   Miscellaneous...........................................................21

     8.1.   Nonwaiver........................................................21
     8.2.   Amendment........................................................21
     8.3.   Communications...................................................22
     8.4.   Like Tenor.......................................................22
     8.5.   Remedies.........................................................22
     8.6.   Successors and Assigns...........................................22
     8.7.   Governing Law....................................................22
     8.8.   Headings; Entire Agreement; Partial Invalidity, etc..............22


Exhibit 2.2(a)     Form of Notice of Exercise
Exhibit 3.1        Form of Assignment




                                  Exhibit 1(b)
                                  ------------

<PAGE>

THIS  WARRANT  HAS NOT BEEN  REGISTERED  UNDER THE  SECURITIES  ACT OF 1933,  AS
AMENDED,  OR ANY OTHER  APPLICABLE  SECURITIES LAW AND MAY NOT BE TRANSFERRED IN
THE ABSENCE OF REGISTRATION THEREUNDER OR AN EXEMPTION THEREFROM.

THIS WARRANT IS SUBJECT TO THE TERMS OF THE  STOCKHOLDERS  AGREEMENT (AS DEFINED
IN THE  SECURITIES  PURCHASE  AGREEMENTS  REFERRED  TO  BELOW).  COPIES  OF SUCH
AGREEMENT  ARE ON FILE AT THE  ISSUER'S  PRINCIPAL  OFFICES  AND,  UPON  WRITTEN
REQUEST,  COPIES  THEREOF  WILL BE MAILED  WITHOUT  CHARGE  WITHIN  FIVE DAYS OF
RECEIPT OF SUCH REQUEST TO APPROPRIATELY INTERESTED PERSONS.


                                     WARRANT

                   To Purchase       Shares of Common Stock of
                               -----

                                 UNIDIGITAL INC.

No. RW-                                                                 , 19
       ---                                             -------------- --    ---


     THIS IS TO CERTIFY that, for value received,
                                                 ------------------------------,
or  registered  assigns,  is entitled  upon the due exercise  hereof at any time
during the Exercise Period (as hereinafter defined) to purchase in the aggregate
         shares of Common Stock, par value $.01 per share, of UNIDIGITAL INC., a
--------
Delaware corporation (the "Holding Company"), at an Exercise Price of $5.425 per
share (such Exercise Price and the number of shares of Common Stock  purchasable
hereunder being subject to adjustment as provided  herein),  and to exercise the
other rights, powers and privileges  hereinafter provided,  all on the terms and
subject to the conditions hereinafter set forth.

     This Warrant is one of the Holding Company's Warrants to Purchase Shares of
Common Stock (herein,  together with any warrants issued in exchange therefor or
replacement  thereof,  all as amended or supplemented  from time to time, called
the "Warrants")  initially  exercisable in the aggregate for 690,134 (subject to
adjustment)  shares  of  Common  Stock  and  issued  pursuant  to those  certain
Securities Purchase Agreements, dated the Closing Date, by and among the Holding
Company,  its  Subsidiaries  and the  institutional  investors named therein (as
amended,  modified and supplemented from time to time, the "Securities  Purchase
Agreements"). Reference is hereby made to the Securities Purchase Agreements and
the other Operative  Documents (as defined  therein) for a description of, among
other things,  certain terms relating to the Warrants and the Warrant Shares and
certain rights of the holders thereof, including,

                                  Exhibit 1(b)
                                  ------------

<PAGE>

without  limitation,  the right to require the registration under the Securities
Act of the  Warrant  Shares  under  certain  circumstances.  Holders of Warrants
and/or Warrant Shares are entitled to the applicable  benefits of the Securities
Purchase  Agreements  and the other  Operative  Documents  and may  enforce  the
applicable  agreements  contained  therein,  all in  accordance  with the  terms
thereof,  notwithstanding any payment or prepayment or redemption or acquisition
of any of the  other  Securities  issued  pursuant  to the  Securities  Purchase
Agreements.

1.   Definitions.
     -----------

     1.1.  Definitions of Terms.  Terms used herein without definition which are
           --------------------
defined in the Securities Purchase Agreements have the meanings ascribed to them
therein,  unless the context  clearly  requires  otherwise,  including,  without
limitation, the following terms: "Business Day", "corporation",  "Common Stock",
                                  -------- ---    -----------     ------------
"Consolidated  Total  Assets",  "Notes",  "Officer's  Certificate",   "Operative
 ------------  -----  ------     -----     ---------  -----------      ---------
Documents", "Organizational Documents", "Person", "Preferred Shares", "Principal
---------    -------------- ---------    ------    --------- ------    ---------
Stockholder",   "Pro  Forma   Consolidated  Cash  Flow",   "Required   Holders",
-----------      ---  -----   ------------  ----  ----      --------   -------
"Securities",  "Securities  Act",  "Shares" and "Subsidiary".  In addition,  the
 ----------     ----------  ---     ------       ----------
terms defined in this section 1, whenever used and  capitalized in this Warrant,
shall,  unless the context  otherwise  requires,  have the following  respective
meanings:

     "Assignment" shall mean the form of Assignment appearing at the end of this
      ----------
Warrant.

     "Closing Date" shall mean September 14, 1999.
      ------- ----

     "Convertible  Securities"  shall mean  evidences  of  indebtedness,  Shares
      -----------  ----------
(including, without limitation,  Preferred Shares) or other securities which are
convertible  into or exchangeable or exercisable for, with or without payment of
additional consideration, shares of Common Stock, either immediately or upon the
arrival of a specified date or the happening of a specified event.

     "Current Market Price" of any security (including,  without limitation, any
      ------- ------ -----
share of Common Stock) as of any date herein specified shall mean the average of
the daily  closing  prices for the 30  consecutive  trading days  commencing  45
trading  days  before the day in question  (or in the event that a security  has
been  traded  for less  than 45 days,  each of the  trading  days on which  such
security has been  traded).  The closing price for each day shall be (a) if such
                                                                      -
security is listed or admitted for trading on any national securities  exchange,
the last sale price of such security, regular way, or the average of the closing
bid  and  asked  prices  thereof  if no such  sale  occurred,  in  each  case as
officially reported on the principal  securities exchange on which such security
is listed, or (b) if not reported as described in clause (a), the average of the
               -
closing bid and asked prices of such security in the over-the-counter  market as
shown by the National Association of Securities

                                  Exhibit 1(b)
                                  ------------

                                      -2-
<PAGE>

Dealers,  Inc.  Automated  Quotation  System, or any similar system of automated
dissemination  of  quotations  of  securities  prices  then in common use, if so
quoted,  as reported by any member firm of the New York Stock Exchange  selected
by the Holding  Company,  or (c) if not quoted as  described  in clause (b), the
                              -
average of the closing bid and asked prices for such security as reported by the
National Quotation Bureau Incorporated or any similar successor organization, as
reported  by any member  firm of the New York  Stock  Exchange  selected  by the
Holding Company.  If such security is quoted on a national securities or central
market  system in lieu of a market or  quotation  system  described  above,  the
closing  price shall be  determined in the manner set forth in clause (a) of the
preceding  sentence if actual  transactions  are  reported and in the manner set
forth in  clause  (b) of the  preceding  sentence  if bid and asked  prices  are
reported but actual transactions are not.

     "Distribution" shall have the meaning specified in section 4.2(g).
      ------------

     "Exercise Period" shall mean the period
      -------- ------

          (a)  commencing on the earliest to occur of:

               (i)   September 14, 2002;

               (ii)  the first  date  following  the  Closing  Date on which the
          Holding   Company  shall  file  a  registration   statement  with  the
          Commission for any public offering of the Common Stock (other than for
          a registration  of shares  issuable upon the  conversion,  exercise or
          exchange of the Convertible Securities and/or Purchase Rights referred
          to in section  4.2(n)(ii) or 4.2(n)(iii) which were issued pursuant to
          an employee  stock option plan or an employee  stock  purchase plan of
          the Holding Company);

               (iii) the first  date  following  the  Closing  Date on which the
          Holding  Company or any of its  Subsidiaries  sells any properties and
          assets (A) representing more than 10% of Consolidated  Total Assets as
                  -
          of the then most  recently  ended  fiscal  quarter  or (B) to which is
                                                                  -
          properly  attributed more than 10% of Pro Forma Consolidated Cash Flow
          for the most  recently  completed  period of four  consecutive  fiscal
          quarters; and

               (iv) the  occurrence  of any Event of Default  or other  material
          default by the Holding  Company or any of its  Subsidiaries  under any
          Debt of the Holding Company or any of its Subsidiaries; and

          (b)  terminating at 5:00 p.m. Boston time on September 14, 2006.

                                  Exhibit 1(b)
                                  ------------

                                      -3-
<PAGE>

     "Exercise  Price"  shall mean the price per share of Common Stock set forth
      --------  -----
in the  preamble  to this  Warrant,  as such price may be  adjusted  pursuant to
section 4.

     "Fair  Value"  shall  mean the  fair  value  of the  appropriate  security,
      ----  -----
property,  asset,  business or entity as determined by the board of directors of
the Holding Company,  provided that if, within 15 days following  receipt of the
                      --------
writing  setting  forth  any such  determination  of Fair  Value by the board of
directors of the Holding  Company,  the Required  Holders of the Warrants  shall
notify the Holding Company of their disagreement with such  determination,  then
Fair  Value  shall be  determined  by an  independent  appraiser  of  recognized
national standing  (selected by the Holding Company and reasonably  satisfactory
to the Required Holders of the Warrants). Each determination of Fair Value shall
be made in accordance with generally  accepted  financial  practice and shall be
set forth in writing, and the Holding Company shall,  immediately following such
determination,  deliver  a  copy  thereof  to  each  holder  or  holders  of the
Securities then outstanding. The determination of any such independent appraiser
so made shall be  conclusive  and  binding  on the  Holding  Company  and on all
holders of the  Warrants  for  purposes of the event giving rise to the need for
such  determination.  The Holding Company shall pay all of the expenses incurred
in connection with any such determination,  including,  without limitation,  the
expenses  of  the  independent   appraiser,   if  any,   engaged  to  make  such
determination.  If the Holding  Company  shall not have engaged  such  appraiser
within  20 days  after  the  occurrence  of the  event  giving  rise to the need
therefor,  then such  appraiser  may be engaged by the  Required  Holders of the
Warrants. Notwithstanding the foregoing, in the case of any security (including,
without  limitation,  any share of Common Stock),  if clauses (a), (b) or (c) of
the definition of Current Market Price are applicable to such security, then the
Fair Value of such security shall be the Current Market Price of such security.

     "Holding Company" shall mean Unidigital Inc., a Delaware  corporation,  and
      ------- -------
any successor thereto.

     "Notice of Exercise" shall mean the Notice of Exercise substantially in the
      ------ -- --------
form of Exhibit 2.2(a) attached hereto.
        --------------

     "Other  Securities" shall mean with reference to the exercise  privilege of
      -----  ----------
the holders of the Warrants,  any Shares (other than shares of Common Stock) and
any other  securities of the Holding  Company  (including,  without  limitation,
Preferred  Shares) or of any other  Person  which the holders of the Warrants at
any time shall be entitled to receive, or shall have received, upon the exercise
or partial exercise of the Warrants,  in lieu of or in addition to Common Stock,
or which at any time shall be issuable or shall have been issued in exchange for
or in replacement of Common Stock (or Other Securities) pursuant to the terms of
the Warrants or otherwise.


                                  Exhibit 1(b)
                                  ------------

                                      -4-
<PAGE>

     "Purchase  Rights"  shall mean any  warrants,  options  or other  rights to
      --------  ------
subscribe for,  purchase or otherwise  acquire any shares of Common Stock or any
Convertible  Securities,  either  immediately or upon the arrival of a specified
date or the happening of a specified event.

     "Securities  Purchase  Agreements"  shall have the meaning specified in the
      ----------  --------  ----------
preamble to this Warrant.

     "Warrant  Shares"  shall  mean the  shares of Common  Stock  (and/or  Other
      -------  ------
Securities)  issued  or  issuable,  as the case may be,  from  time to time upon
exercise of the Warrants,  including,  without limitation,  any shares of Common
Stock (and/or Other  Securities)  issued or issuable with respect thereto by way
of dividend or  distribution  or in  connection  with a  combination  of Shares,
recapitalization, merger, consolidation, other reorganization or otherwise.

     "Warrants"  shall  have  the  meaning  specified  in the  preamble  to this
      --------
Warrant.

     1.2.  Other  Definitions.  The terms defined in this section 1.2,  whenever
           ------------------
used in this Warrant,  shall,  unless the context otherwise  requires,  have the
following respective meanings:

     "this  Warrant"  (and  similar  references  to any of the  other  Operative
      ----  -------
Documents)  shall mean,  and the words "herein" (and  "therein"),  "hereof" (and
                                        ------         -------      ------
"thereof"),  "hereunder" (and  "thereunder")  and words of similar import shall,
 -------      ---------         ----------
unless the context clearly  requires  otherwise,  refer to, such  instruments as
they may from time to time be amended, modified or supplemented.

2.   Exercise of Warrant.
     -------------------

     2.1. Right to Exercise;  Notice. On the terms and subject to the conditions
          --------------------------
of this  section 2, the holder  hereof shall have the right,  at its option,  to
exercise  this  Warrant  in whole  or in part at any  time or from  time to time
during the Exercise Period, all as more fully specified below.

     2.2.  Manner of  Exercise;  Issuance  of Common  Stock.  To  exercise  this
           ------------------------------------------------
Warrant,  the holder hereof shall deliver to the Holding Company (a) a Notice of
                                                                  -
Exercise  (substantially  in the form of Exhibit  2.2(a)  attached  hereto) duly
                                         ---------------
executed  by  a  duly   authorized   officer  of  the  holder   hereof  (or  its
attorney-in-fact)  specifying the Warrant Shares to be purchased,  (b) an amount
                                                                    -
equal to the aggregate  Exercise  Price for all Warrant  Shares as to which this
Warrant  is then  being  exercised  and (c) this  Warrant.  At the option of the
                                         -
holder hereof,  payment of the Exercise Price shall be made (w) by wire transfer
                                                             -
of funds to an account in a bank located in the United States  designated by the
Holding  Company  for such  purpose,  (x) by check  payable  to the order of the
                                       -
Holding

                                  Exhibit 1(b)
                                  ------------

                                      -5-
<PAGE>


Company,  (y) by  application  of any Notes or any Warrant  Shares,  as provided
           -
below, or (z) by any combination of such methods.
           -

         Upon the  exercise  of this  Warrant  in whole or in part,  the  holder
hereof may, at its option,  submit to the Holding Company  written  instructions
from such holder to apply any specified  portion of the Warrant Shares  issuable
upon such exercise in payment of the Exercise Price required upon such exercise,
in which case the Holding  Company  will accept  such  specified  portion of the
Warrant  Shares (at a value per share equal to the then Fair Value thereof less,
                                                                           ----
in each case,  the Exercise  Price then in effect),  in lieu of a like amount of
such cash payment.

         Upon the  exercise of this Warrant in whole or in part by the holder of
any Notes,  such holder may, at its option,  surrender such Notes to the Holding
Company together with written  instructions from such holder to apply all or any
specified  principal  amount of such Notes against the payment of some or all of
the  Exercise  Price  required  upon such  exercise,  in which case the  Holding
Company will accept such specified  principal amount in lieu of a like amount of
cash. In lieu of or in addition to the aforesaid  application,  such holder may,
without  surrendering  such  Notes,  furnish the Holding  Company  with  written
instructions  to apply all or any specified  amount of accrued  interest on such
Notes  against the payment of some or all of the Exercise  Price  required  upon
such  exercise,  in which case the Holding  Company  will accept such  specified
accrued  interest  in lieu of a like  amount  of cash.  Upon  any  such  partial
application of the principal of any such Note, the Companies will promptly issue
and deliver to or upon the order of the holder thereof a new Note or Notes equal
in aggregate principal amount to the unpaid principal amount of such surrendered
Note not so  applied  and dated so as to result in no loss of  interest.  At the
time of surrender of any such Note  pursuant to this section 2.2, the  Companies
will pay to the holder  surrendering  such Note all  interest  on the  principal
amount thereof so applied (but no premium shall be due in connection  therewith)
accrued  to and  including  the date of such  surrender  and not  applied to the
Exercise Price.

         Upon  receipt of the items  referred  to in section  2.3,  the  Holding
Company shall, as promptly as practicable, and in any event within five Business
Days  thereafter,  cause to be issued and delivered to the holder hereof (or its
nominee) or the transferee  designated in the Notice of Exercise,  a certificate
or  certificates  representing  the Warrant  Shares  specified  in the Notice of
Exercise (but not exceeding the maximum number thereof issuable upon exercise of
this  Warrant)  minus the  Warrant  Shares,  if any,  applied  in payment of the
                -----
Exercise Price. Such certificates  shall be registered in the name of the holder
hereof (or its nominee) or in the name of such transferee, as the case may be.

         If this Warrant is exercised in part, the Holding Company shall, at the
time of delivery of such certificate or  certificates,  issue and deliver to the
holder hereof or the  transferee so designated in the Notice of Exercise,  a new
Warrant evidencing the right of

                                  Exhibit 1(b)
                                  ------------

                                      -6-
<PAGE>

the holder hereof or such  transferee to purchase at the Exercise  Price then in
effect the Warrant  Shares for which this Warrant shall not have been  exercised
and this Warrant shall be cancelled.

     2.3.  Effectiveness of Exercise.  Unless otherwise  requested by the holder
           -------------------------
hereof, this Warrant shall be deemed to have been exercised and such certificate
or certificates representing Warrant Shares shall be deemed to have been issued,
and the holder or transferee  so  designated in the Notice of Exercise  shall be
deemed to have  become  the  holder of record  of such  Warrant  Shares  for all
purposes,  as of the  close  of  business  on the date on which  the  Notice  of
Exercise,  the Exercise  Price and this Warrant  shall have been received by the
Holding Company.

     2.4.  Continued  Validity.  A holder  of  Warrant  Shares  issued  upon the
           -------------------
exercise of this Warrant,  in whole or in part, shall continue to be entitled to
all  rights  to which a holder  of this  Warrant  is  entitled  pursuant  to the
provisions of this Warrant except such rights as by their terms apply solely (a)
                                                                              -
to the holder of a Warrant or (b) to the period  prior to the  exercise  of this
                               -
Warrant in whole or in part,  notwithstanding  that this  Warrant  is  cancelled
following such exercise.  The Holding  Company will, at the time of any exercise
of this  Warrant,  upon the request of the holder of the Warrant  Shares  issued
upon  the  exercise   hereof,   acknowledge  in  writing,   in  form  reasonably
satisfactory to such holder, its continuing  obligation to afford to such holder
all  rights to which  such  holder  shall  continue  to be  entitled  after such
exercise in accordance with the provisions of this Warrant,  including,  without
limitation,  those set forth in sections  7.1, 7.2, 7.3 and 7.4 of this Warrant;
provided that if such holder shall fail to make any such  request,  such failure
--------
shall not affect the continuing  obligation of the Holding  Company to afford to
such holder all such rights.

     2.5.  Automatic  Exercise on Last Day of Exercise  Period.  If this Warrant
           ---------------------------------------------------
shall not have been  exercised in full on or before the last day of the Exercise
Period,  then this Warrant shall be  automatically  exercised,  without  further
action on the part of the holder hereof, in full (and the holder hereof shall be
deemed to be a holder of the Warrant Shares issued upon such automatic exercise)
on and as of the  last  day of the  Exercise  Period,  unless  at any time on or
before such last day of the  Exercise  Period the holder of this  Warrant  shall
notify the  Holding  Company in writing  that no such  automatic  exercise is to
occur.  Payment of the Exercise Price due in connection  with any such automatic
exercise  pursuant  to this  section  2.5 shall be made by  application  of that
portion of the Warrant Shares  issuable upon such exercise (at a value per share
equal to the then Fair Value thereof less, in each case, the Exercise Price then
                                     ----
in  effect)  equal to the  aggregate  Exercise  Price  which  is due  upon  such
exercise,  unless at any time on or before such last day of the Exercise  Period
the holder of this  Warrant  shall  notify the Holding  Company that such holder
elects one of the other  payment  options set forth in section 2.2 or unless the
Fair Value of the Warrant Shares is less than the Exercise Price then in effect.
As promptly as  practicable  following any such automatic  exercise,  and in any
event within

                                  Exhibit 1(b)
                                  ------------

                                      -7-
<PAGE>

ten Business Days after the day that the holder of this Warrant  surrenders this
Warrant to the Holding Company for cancellation, the Holding Company shall cause
to be issued and delivered to the holder hereof a certificate  registered in the
name of the holder  hereof  (unless the holder shall  specifically  instruct the
Holding Company otherwise)  representing the Warrant Shares issued in connection
with such automatic exercise of this Warrant minus the number of Warrant Shares,
                                             -----
if any, applied in payment of the Exercise Price.

3.   Registration, Transfer, Exchange and Replacement of Securities; Legends.
     -----------------------------------------------------------------------

     3.1.  Registration,  Transfer,  Exchange  and  Replacement  of  Securities.
           --------------------------------------------------------------------
Reference  is  hereby  made  to  the  Securities  Purchase  Agreements  and  the
Registration   Rights   Agreement  for  certain   provisions   relating  to  the
registration,  transfer,  exchange and  replacement  of the Warrants and Warrant
Shares.  To  transfer  this  Warrant,  the holder  shall  deliver to the Holding
Company  a  Notice  of  Assignment  (substantially  in the form of  Exhibit  3.1
                                                                    ------------
attached hereto) duly executed by the holder hereof (or its attorney) specifying
that this Warrant (or any portion  hereof) is to be transferred to the Person(s)
named therein.

     3.2. Transfers and Legends. Neither this Warrant nor any Warrant Shares may
          ---------------------
be transferred or assigned unless  registered under the Securities Act or unless
an exemption from such registration is available, and any transfer or assignment
not made in accordance with the foregoing shall be void. Until the date on which
a  registration  statement  covering the Warrants  becomes  effective  under the
Securities Act, each Warrant shall bear a legend in substantially  the following
form:

           "THIS WARRANT HAS NOT BEEN  REGISTERED  UNDER THE SECURITIES
           ACT OF 1933, AS AMENDED, OR ANY OTHER APPLICABLE  SECURITIES
           LAW  AND  MAY  NOT  BE   TRANSFERRED   IN  THE   ABSENCE  OF
           REGISTRATION THEREUNDER OR AN EXEMPTION THEREFROM."

Until the date on which a  registration  statement  covering the Warrant  Shares
becomes effective under the Securities Act, each certificate  evidencing Warrant
Shares shall bear a legend in substantially the following form:

           "THE  SECURITIES  REPRESENTED BY THIS  CERTIFICATE  HAVE NOT
           BEEN  REGISTERED  UNDER  THE  SECURITIES  ACT  OF  1933,  AS
           AMENDED, OR ANY OTHER APPLICABLE  SECURITIES LAW AND MAY NOT
           BE TRANSFERRED IN THE ABSENCE OF REGISTRATION  THEREUNDER OR
           AN EXEMPTION THEREFROM."


                                  Exhibit 1(b)
                                  ------------

                                      -8-
<PAGE>

Upon  receipt  from any  holder of  Warrants  or Warrant  Shares by the  Holding
Company  of a notice to the  effect  that any of the  foregoing  legends  are no
longer   required  or  applicable,   the  Holding   Company  shall  reissue  the
certificates  evidencing the applicable  Securities  without such legends unless
the Holding Company shall promptly  deliver to such holder an opinion of counsel
reasonably  satisfactory  to such holder that such legends are still required or
applicable.

4.   Anti-Dilution Provisions.
     ------------------------

     4.1. Adjustment of Number of Shares Purchasable. Upon any adjustment of the
Exercise Price as provided in section 4.2, the holder hereof shall thereafter be
entitled to purchase, at the Exercise Price resulting from such adjustment,  the
number of shares of Common Stock  (calculated to the nearest 1/100th of a share)
obtained by multiplying the Exercise Price in effect  immediately  prior to such
adjustment  by the  number  of  shares of  Common  Stock  purchasable  hereunder
immediately  prior to such  adjustment  and dividing the product  thereof by the
Exercise Price resulting from such adjustment.

     4.2.  Adjustment of Exercise Price. In addition to any adjustment  required
under the provisions of section 4.5 below,  and except as otherwise  provided in
section  4.2(n) below,  the Exercise  Price shall be subject to adjustment  from
time to time as set forth in this section 4.2.

          (a)  Dividends, Distributions, Subdivisions and  Combinations.  If and
     whenever the Holding Company subsequent to the date hereof:

               (i)  declares  a  dividend  upon,  or makes any  distribution  in
          respect  of,  any of its  Shares  payable  in shares of Common  Stock,
          Convertible Securities or Purchase Rights, or

               (ii)  subdivides  its  outstanding  shares of Common Stock into a
          larger number of shares of Common Stock, or

               (iii)  combines  its  outstanding  shares of Common  Stock into a
          smaller number of shares of Common Stock,

     then the  Exercise  Price  shall be adjusted  to that price  determined  by
     multiplying the Exercise Price in effect immediately prior to such event by
     a  fraction  (A) the  numerator  of which  shall  be the  total  number  of
                   -
     outstanding shares of Common Stock immediately prior to such event, and (B)
                                                                              -
     the denominator of which shall be the total number of outstanding shares of
     Common Stock  immediately  after such event,  treating as  outstanding  all
     shares of Common Stock  issuable upon  conversions or exchanges of any such
     Convertible Securities issued in such

                                  Exhibit 1(b)
                                  ------------

                                      -9-
<PAGE>

     dividend or  distribution  and exercises of any such Purchase Rights issued
     in such dividend or distribution.

          (b) Issuance of Additional Shares of Common Stock. If and whenever the
              ---------------------------------------------
     Holding  Company  subsequent  to the date  hereof  shall  issue or sell any
     shares of Common Stock (except as otherwise  provided in the last paragraph
     of this section 4.2(b)),  for a consideration  per share less than the Fair
     Value per share (determined,  in each case, as of the date specified in the
     next succeeding  paragraph),  the Exercise Price upon each such issuance or
     sale shall be  adjusted  as of the date  specified  in the next  succeeding
     paragraph to the price  determined  by  multiplying  the Exercise  Price in
                                             -----------
     effect  as of the date  specified  in the next  succeeding  paragraph  by a
     fraction  (x) the  numerator  of which is (A) the sum of (1) the  number of
                -                               -              -
     shares of Common Stock outstanding  immediately prior to such issue or sale
     multiplied by the Fair Value per share of Common Stock immediately prior to
     such issue or sale plus (2) the aggregate  consideration,  if any, received
                              -
     by the Holding  Company  upon such issue or sale,  divided by (B) the total
                                                                    -
     number of shares of Common Stock  outstanding  immediately after such issue
     or sale,  and (y) the  denominator  of which is the Fair Value per share of
                    -
     Common Stock immediately prior to such issue or sale.

          For the  purposes  of this  section  4.2(b),  the date as of which the
     Exercise  Price shall be  adjusted  and the date as of which the Fair Value
     shall be  determined  shall  be the  earlier  of (A) the date on which  the
                                                       -
     Holding  Company  shall enter into a firm contract for the issuance of such
     shares of  Common  Stock  and (B)  immediately  prior to the date of actual
                                    -
     issuance of such shares of Common Stock.

          No adjustment  of the Exercise  Price shall be made under this section
     4.2(b)  upon the  issuance  of any  shares  of Common  Stock  which are (i)
                                                                              -
     distributed to holders of Common Stock pursuant to a dividend, distribution
     or  subdivision  for which an adjustment  shall  previously  have been made
     under  section  4.2(a)  or (ii)  issued  pursuant  to the  exercise  of any
                                 --
     Purchase   Rights  or  pursuant  to  the  conversion  or  exchange  of  any
     Convertible  Securities to the extent that an adjustment  shall  previously
     have been made upon the  issuance of such  Purchase  Rights or  Convertible
     Securities pursuant to sections 4.2(a), (c) or (d).

          (c) Issuance of Purchase  Rights.  If and whenever the Holding Company
              ----------------------------
     subsequent  to the date  hereof  shall  issue or sell any  Purchase  Rights
     (except as otherwise provided in the last paragraph of this section 4.2(c))
     and the consideration per share for which shares of Common Stock may at any
     time  thereafter  be issuable  upon  exercise  thereof  (or, in the case of
     Purchase  Rights  exercisable  for the purchase of Convertible  Securities,
     upon the subsequent conversion or exchange of such Convertible  Securities)
     shall be less than the Fair Value per share  (determined,  in each case, as
     of the date specified in the next

                                  Exhibit 1(b)
                                  ------------

                                      -10-
<PAGE>

     succeeding  paragraph),  the Exercise Price upon each such issuance or sale
     shall be adjusted as provided in section 4.2(b) as of the date specified in
     the next  succeeding  paragraph  on the basis  that the  maximum  number of
     shares of Common Stock ever issuable upon exercise of such Purchase  Rights
     (or upon conversion,  exercise or exchange of such  Convertible  Securities
     following such exercise) shall be deemed to have been issued as of the date
     of the  determination  of the Fair Value  specified in the next  succeeding
     paragraph.

          For the  purposes  of this  section  4.2(c),  the date as of which the
     Exercise  Price shall be  adjusted  and the date as of which the Fair Value
     shall be  determined  shall  be the  earlier  of (A) the date on which  the
                                                       -
     Holding  Company  shall enter into a firm contract for the issuance of such
     Purchase Rights and (B) immediately prior to the date of actual issuance of
                          -
     such Purchase Rights.

          No adjustment  of the Exercise  Price shall be made under this section
     4.2(c)  upon the  issuance  of any  Purchase  Rights to the extent  that an
     adjustment  shall  previously  have  been made  upon the  issuance  of such
     Purchase Rights pursuant to section 4.2(a).

          (d) Issuance of  Convertible  Securities.  If and whenever the Holding
              ------------------------------------
     Company  subsequent to the date hereof shall issue or sell any  Convertible
     Securities  (except as  otherwise  provided in the last  paragraph  of this
     section 4.2(d)) and the  consideration per share for which shares of Common
     Stock may at any time thereafter be issuable  pursuant to the terms of such
     Convertible  Securities  shall  be less  than  the  Fair  Value  per  share
     (determined,  in each case, as of the date specified in the next succeeding
     paragraph),  the  Exercise  Price upon each such  issuance or sale shall be
     adjusted as provided in section 4.2(b) as of the date specified in the next
     succeeding  paragraph  on the basis  that the  maximum  number of shares of
     Common Stock ever necessary to effect the conversion,  exercise or exchange
     of all such  Convertible  Securities shall be deemed to have been issued as
     of the date of the  determination  of the Fair Value  specified in the next
     succeeding paragraph.

          For the  purposes  of this  section  4.2(d),  the date as of which the
     Exercise  Price shall be  adjusted  and the date as of which the Fair Value
     shall be  determined  shall  be the  earlier  of (A) the date on which  the
                                                       -
     Holding  Company  shall enter into a firm contract for the issuance of such
     Convertible  Securities  and (B)  immediately  prior to the date of  actual
                                   -
     issuance of such Convertible Securities.

          No adjustment  of the Exercise  Price shall be made under this section
     4.2(d)  upon the  issuance  of any  Convertible  Securities  which  are (i)
                                                                              -
     distributed   to  holders  of  Common  Stock  pursuant  to  a  dividend  or
     distribution  to the extent that an adjustment  shall  previously have been
     made pursuant to section 4.2(a) or

                                  Exhibit 1(b)
                                  ------------

                                      -11-
<PAGE>

     (ii) issued  pursuant to the exercise of any Purchase  Rights to the extent
      --
     that an  adjustment  shall  previously  have been made upon the issuance of
     such Purchase Rights pursuant to section 4.2(a) or (c).

          (e)  Minimum  Adjustment.  If any  adjustment  of the  Exercise  Price
               -------------------
     pursuant to this  section 4.2 shall  result in an  adjustment  of less than
     $0.05425,  no such adjustment shall be made, but any such lesser adjustment
     shall be carried  forward and shall be made at the time and  together  with
     the next  subsequent  adjustment  which,  together with any  adjustments so
     carried  forward,  shall  amount  to  $0.05425;   provided  that  upon  any
                                                       --------
     adjustment of the Exercise Price  resulting  from (i) the  declaration of a
                                                        -
     dividend upon, or the making of any  distribution in respect of, any Shares
     of the  Holding  Company  payable  in  Common  Stock,  Purchase  Rights  or
     Convertible   Securities  or  (ii)  the  reclassification  by  subdivision,
                                    --
     combination  or  otherwise,  of the Common  Stock into a greater or smaller
     number of shares,  the foregoing figure of $0.05425 (or such figure as last
     adjusted) shall be proportionately  adjusted,  and provided,  further, that
                                                        --------   -------
     upon the  exercise  of this  Warrant,  the Holding  Company  shall make all
     necessary adjustments (to the nearest .0001 of a cent) not theretofore made
     to the Exercise  Price up to and including the date upon which this Warrant
     is exercised.

          (f)  Readjustment  of  Exercise  Price.  Upon  each  change in (i) the
               ---------------------------------                          -
     consideration,  if any,  payable  for any  Purchase  Rights or  Convertible
     Securities   referred  to  in  section   4.2(a),   (c)  or  (d),  (ii)  the
                                                                        --
     consideration,  if any,  payable upon exercise of such  Purchase  Rights or
     upon the conversion, exercise or exchange of such Convertible Securities or
     (iii) the number of shares of Common  Stock  issuable  upon the exercise o
      ---
     such Purchase Rights or the rate at which such  Convertible  Securities are
     convertible  into or exchangeable  for shares of Common Stock, the Exercise
     Price in effect at the time of such event shall  forthwith be readjusted to
     the  Exercise  Price  which would have been in effect at such time had such
     Purchase  Rights  or  Convertible  Securities  provided  for  such  changed
     consideration,  number of shares of Common Stock so issuable or  conversion
     rate, as the case may be, at the time initially granted, issued or sold. On
     the expiration or  termination  of any Purchase  Rights not exercised or of
     any right to convert, exercise or exchange under any Convertible Securities
     terminated  or not  exercised,  the  Exercise  Price  then in effect  shall
     forthwith  be  increased  to the  Exercise  Price  which would have been in
     effect  at the  time  of  such  expiration  had  such  Purchase  Rights  or
     Convertible  Securities never been issued.  No readjustment of the Exercise
     Price pursuant to this section 4.2(f) shall (i) increase the Exercise Price
                                                  -
     by an amount in excess of the  adjustment  originally  made to the Exercise
     Price in  respect of the issue,  sale or grant of the  applicable  Purchase
     Rights or  Convertible  Securities  or (ii) require any  adjustment  to the
                                             --
     amount  paid or number of Warrant  Shares  received  by any Person upon any
     exercise of this Warrant prior to the date upon which such  readjustment to
     the Exercise Price shall occur.


                                  Exhibit 1(b)
                                  ------------

                                      -12-
<PAGE>

          (g)  Reorganization,   Reclassification  or  Recapitalization  of  the
               -----------------------------------------------------------------
     Holding  Company;  Dividends, etc.  If and whenever  subsequent to the dat
     ----------------------------------
     hereof  the   Holding   Company   shall  (i)  effect  any   reorganization,
                                               -
     reclassification  or recapitalization of any shares of Common Stock (or any
     other Shares of the Holding  Company)  (other than in the cases referred to
     in section 4.2(a)),  (ii) effect any consolidation or merger of the Holding
                           --
     Company with or into  another  Person,  (iii) effect the sale,  transfer or
                                              ---
     other  disposition  of the  property,  assets or  business  of the  Holding
     Company as an entirety or  substantially  as an  entirety,  (iv) effect any
                                                                  --
     other  transaction  (or  any  other  event  shall  occur)  (other  than  as
     explicitly  provided  elsewhere  in  this  section  4.2) or (v)  declare  a
                                                                  -
     dividend  or make any other  distribution  as a result of which  holders of
     shares of Common  Stock  receive  any  Shares  or other  securities  and/or
     property  (including,   without  limitation,  cash  and/or  Shares  of  any
     Subsidiary of the Holding Company (and including,  without limitation,  any
     dividend  payable  out of earnings or any  surplus  legally  available  for
     distribution  under the laws of the  jurisdiction of the Holding  Company's
     organization))  with  respect  to or in  exchange  for the shares of Common
     Stock (the  transactions  referred to in the foregoing  clauses (i),  (ii),
     (iii),   (iv)  and  (v)   being   each   hereinafter   referred   to  as  a
     "Distribution"),  then at the same time the  holder of this  Warrant  shall
     receive (in addition to or in lieu of, as  applicable,  the Warrant  Shares
     deliverable  upon  exercise  hereof)  the same  number  of  Shares or other
     securities and/or the same property  (including,  without limitation,  cash
     and/or Shares of any  Subsidiary of the Holding  Company) which such holder
     would have received if this Warrant had been exercised immediately prior to
     such Distribution (or the applicable record date therefor).

          Prior to and as a condition of the  consummation of any  Distribution,
     the Holding Company shall make equitable,  written adjustments satisfactory
     to  the  Required  Holders  of  the  Warrants  in  the  application  of the
     provisions  set forth herein and in the other  Operative  Documents so that
     such provisions shall thereafter be applicable,  as nearly as possible,  in
     relation to any Shares or other  securities or other property  delivered to
     the holders of the  Warrants  pursuant  to this  section  4.2(g).  Any such
     adjustment  shall be made by and set forth in a  supplemental  agreement of
     the Holding Company and/or the successor entity, as applicable, in form and
     substance  acceptable  to  the  Required  Holders  of the  Warrants,  which
     agreement  shall bind and shall be enforceable  against the Holding Company
     and/or the successor  entity,  as  applicable,  and all holders of Warrants
     then  outstanding  and shall be accompanied  by a favorable  opinion of the
     regular outside counsel to the Holding Company or the successor  entity, as
     applicable (or such other firm as is reasonably  acceptable to the Required
     Holders of the Warrants), as to the enforceability of such agreement and as
     to  such  other  matters  as  the  Required  Holders  of the  Warrants  may
     reasonably  request,  such opinion to be in form and  substance  reasonably
     acceptable to the Required Holders of the Warrants.

                                  Exhibit 1(b)
                                  ------------

                                      -13-
<PAGE>

          (h)   Other Dilutive Events.  If any other  transaction or event shall
                ----------------------
     occur  (excluding any transaction or event  explicitly  referred to in this
     section 4.2, but including,  without limitation, any issuance,  repurchase,
     redemption,  or  other  distribution  in  respect  of any  Shares  or other
     securities  of the Holding  Company or of any other  Person,  including any
     Person referred to in section 4.2(g)),  as to which the other provisions of
     this  section 4 are not  strictly  applicable  but the  failure to make any
     adjustment  to the  Exercise  Price  or to any of the  other  terms of this
     Warrant  would not fairly  protect  the  purchase  rights and other  rights
     represented  by this Warrant in accordance  with the  essential  intent and
     principles hereof, then, and as a condition to the consummation of any such
     transaction  or event,  and in each such case,  the Holding  Company  shall
     appoint a firm of independent  certified  public  accountants of recognized
     national  standing  (which  may  be the  regular  auditors  of the  Holding
     Company),  which shall give its opinion as to the adjustment,  if any, on a
     basis  consistent with the essential  intent and principles  established in
     this  section  4,  necessary  to  preserve,  without  dilution,  the rights
     represented  by  this  Warrant.   The  certificate  of  any  such  firm  of
     accountants  shall  be  conclusive  evidence  of  the  correctness  of  any
     computation  made under this section 4. The Holding  Company  shall pay the
     fees and expenses of such firm of accountants  in connection  with any such
     opinion.  Upon receipt of such opinion,  the Holding  Company will promptly
     deliver a copy  thereof  to the holder of this  Warrant  and shall make the
     adjustments, if any, described therein.

          (i)   Determination of Consideration. For the purposes of this section
                ------------------------------
     4, the consideration  received or receivable by the Holding Company for the
     issuance,  sale or grant of  shares  of Common  Stock,  Purchase  Rights or
     Convertible  Securities,  irrespective of the accounting  treatment of such
     consideration, shall be valued and determined as follows:

                (i)   Cash Payment.  In the case of cash, the gross  amount paid
                      ------------
          by the  purchasers  without  deduction  of  any  accrued  interest  or
          dividends, any reasonable expenses paid or incurred and any reasonable
          underwriting commissions or concessions paid or allowed by the Holding
          Company in connection with such issue or sale.

                (ii)  Non-Cash Payment.  In the case of consideration other than
                      ----------------
          cash,  the Fair Value thereof (in any case as of the date  immediately
          preceding the issuance, sale or grant in question).

                (iii) Certain  Allocations.  If shares of Common Stock, Purchase
                      --------------------
          Rights and/or Convertible  Securities are issued or sold together with
          other  securities  or  other  assets  of  the  Holding  Company  for a
          consideration  which covers more than one of the foregoing  categories
          of securities  and assets,  the  consideration  received or receivable
          (computed as provided in


                                  Exhibit 1(b)
                                  ------------

                                      -14-
<PAGE>

          clauses (i) and (ii) of this  section 4.2 (i)) shall be  allocable  to
          such  shares of  Common  Stock,  Purchase  Rights  and/or  Convertible
          Securities  as  reasonably  determined  in good  faith by the board of
          directors of the Holding  Company  (provided  such  allocation  is set
                                              --------
          forth  in a  written  resolution  and  a  certified  copy  thereof  is
          furnished  to the holder of this  Warrant  promptly  (but in any event
          within 10 days) following its adoption).

               (iv) Dividends  in  Securities.   If the  Holding  Company  shall
                    -------------------------
          declare a dividend or make any other  distribution  upon any Shares of
          the Holding  Company  payable in shares of Common  Stock,  Convertible
          Securities   or  Purchase   Rights,   such  shares  of  Common  Stock,
          Convertible  Securities  or  Purchase  Rights,  as the  case  may  be,
          issuable in payment of such dividend or  distribution  shall be deemed
          to have been issued or sold without consideration.

               (v) Purchase Rights and Convertible Securities. The consideration
                   ------------------------------------------
          for which each share of Common Stock shall be deemed to be issued upon
          the issuance or sale of any Purchase Rights or Convertible  Securities
          shall be determined by dividing (A) the total  consideration,  if any,
                                           -
          received  by the Holding  Company as  consideration  for the  Purchase
          Rights or the  Convertible  Securities,  as the case may be,  plus the
          minimum  aggregate  amount of additional  consideration,  if any, ever
          payable to the Holding  Company  upon the  exercise  of such  Purchase
          Rights  and/or upon the  conversion  or  exchange of such  Convertible
          Securities,  as the case may be, but without  deduction of any accrued
          interest or dividends,  any  reasonable  expenses paid or incurred and
          any reasonable underwriting commissions or concessions paid or allowed
          by the Holding  Company in connection  with such issue or sale; by (B)
                                                                              -
          the maximum  number of shares of Common Stock ever  issuable  upon the
          exercise of such Purchase Rights or upon the conversion or exchange of
          such Convertible Securities.

               (vi) Merger,  Consolidation  or Sale of Assets.  If any shares of
                    -----------------------------------------
          Common Stock,  Convertible Securities or Purchase Rights are issued in
          connection  with any  merger or  consolidation  of which  the  Holding
          Company is the  surviving  corporation,  the  amount of  consideration
          therefor  shall be deemed to be the Fair Value of such  portion of the
          assets  and  business  of the  non-surviving  corporation  as shall be
          attributable to such Common Stock,  Convertible Securities or Purchase
          Rights,  as the  case  may  be.  In the  event  of (A) any  merger  or
                                                              -
          consolidation  of  which  the  Holding  Company  is not the  surviving
          corporation  or (B) the sale,  transfer  or other  disposition  of the
                           -
          property,  assets or business of the Holding Company as an entirety or
          substantially as an entirety for Shares or other securities of

                                  Exhibit 1(b)
                                  ------------

                                      -15-
<PAGE>

          any other Person,  the Holding  Company shall be deemed to have issued
          the number of shares of Common Stock for Shares or other securities of
          the surviving  corporation or such other Person  computed on the basis
          of the actual  exchange ratio on which the  transaction was predicated
          and for a  consideration  equal to the Fair  Value on the date of such
          transaction  of such  Shares  or  other  securities  of the  surviving
          corporation or such other Person, and if any such calculation  results
          in adjustment of the Exercise Price,  the  determination of the number
          of Warrant Shares  issuable upon exercise of this Warrant  immediately
          prior to such  merger,  consolidation  or sale,  for the  purposes  of
          section  4.2(g),  shall be made after giving effect to such adjustment
          of the Exercise Price.

          (j) Record  Date.  If the Holding  Company  shall take a record of the
              ------------
     holders  of the  Common  Stock for the  purpose  of  entitling  them (i) to
                                                                           -
     receive  a  dividend  or  other  distribution   payable  in  Common  Stock,
     Convertible  Securities  or  Purchase  Rights or (ii) to  subscribe  for or
                                                       --
     purchase Common Stock,  Convertible Securities or Purchase Rights, then all
     references in this section 4 to 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,
     shall be deemed to be references to such record date.

          (k) Shares Outstanding. The number of shares of Common Stock deemed to
              ------------------
     be  outstanding  at any given time shall not include shares of Common Stock
     held by the Holding Company or any Subsidiary of the Holding Company.

          (l) Maximum Exercise Price. At no time shall the Exercise Price exceed
              ----------------------
     the amount set forth in the first paragraph of the Preamble of this Warrant
     except as a result of an adjustment thereto pursuant to section 4.2(a)(iii)
     or 4.2(g).

          (m) Application.  All subdivisions of this section 4.2 are intended to
              -----------
     operate  independently of one another.  If a transaction or an event occurs
     that requires the application of more than one subdivision,  all applicable
     subdivisions shall be given independent effect (but without  duplication of
     adjustment).

          (n) No Adjustments Under Certain Circumstances. Anything herein to the
              ------------------------------------------
     contrary notwithstanding, no adjustment to the Exercise Price shall be made
     in the case of:

               (i) any issuance of shares of Common Stock (or Other  Securities)
          upon the exercise in whole or in part of any of the Warrants;

                                  Exhibit 1(b)
                                  ------------

                                      -16-
<PAGE>

               (ii) any issuance of shares of Common Stock upon the  conversion,
          exercise or exchange of any  Convertible  Securities  and/or  Purchase
          Rights outstanding on the Closing Date and specified on Exhibit 5.5(b)
                                                                  --------------
          attached to the  Securities  Purchase  Agreements,  provided  that the
                                                              --------
          aggregate  number of shares of Common Stock so issued shall not exceed
          2,585,031  (subject to appropriate  adjustment for any stock dividend,
          subdivision or combination) at any time;

               (iii) any grant by the Holding  Company to any  employees  of the
          Holding Company or any of its  Subsidiaries  (other than the Principal
          Stockholder  (or any  members of his  Family)) of any shares of Common
          Stock and/or options to purchase  shares of Common Stock pursuant to a
          stock  option plan  adopted by the board of  directors  of the Holding
          Company,  and the issuance of shares of Common Stock upon the exercise
          of such  options,  provided  that the  aggregate  number  of shares of
                             --------
          Common Stock so granted,  issued and issuable shall not exceed 920,178
          (subject to appropriate adjustment for any stock dividend, subdivision
          or combination) at any time; and

               (iv) any  issuance  of  shares of  Common  Stock (or  Convertible
          Securities  or  Purchase  Rights)  to any  Person  (who  prior to such
          issuance  was not  affiliated  with the Holding  Company or any of its
          Subsidiaries) as consideration paid in connection with any acquisition
          of any Person or business effected in compliance with the terms of the
          Operative Documents so long as the per share consideration received or
          receivable  by the Holding  Company for such issuance is not less than
          the average  market  price of the Common  Stock during a period of not
          less than 10 consecutive trading days ended not more than 5 days prior
          to the date of such  issuance  of such  Common  Stock (or  Convertible
          Securities or Purchase Rights).

     4.3.  Rights  Offering.  If the Holding Company shall effect an offering of
           ----------------
securities pro rata among its stockholders, the holder hereof shall be entitled,
           --- ----
at its option,  to elect to  participate  in each and every such  offering as if
this Warrant had been  exercised  and such holder were,  at the time of any such
rights  offering,  then a holder of that number of Warrant  Shares to which such
holder is then entitled on the exercise hereof.

     4.4.  Certificates and Notices.
           ------------------------

           (a) Adjustments to Exercise Price. As promptly as practicable (but in
               -----------------------------
     any event  not later  than five  days)  after the  occurrence  of any event
     requiring any adjustment  under this section 4 to the Exercise Price (or to
     the number or kind of securities  or other  property  deliverable  upon the
     exercise of this Warrant), the

                                  Exhibit 1(b)
                                  ------------

                                      -17-
<PAGE>

     Holding  Company  shall,  at its  expense,  deliver  to the  holder of this
     Warrant either (i) an Officer's Certificate or (ii) a certificate signed by
                     -                               --
     a firm of independent  public  accountants of recognized  national standing
     (which may be the regular auditors of the Holding  Company),  setting forth
     in reasonable  detail the events requiring the adjustment and the method by
     which such  adjustment was calculated and specifying the adjusted  Exercise
     Price  and the  number of  shares  of  Common  Stock (or Other  Securities)
     purchasable  upon  exercise of this  Warrant  after  giving  effect to such
     adjustment.  The  certificate  of any  such  firm of  accountants  shall be
     conclusive  evidence of the correctness of any computation  made under this
     section 4.

          (b)  Extraordinary   Events.  If  and  whenever  the  Holding  Company
               ----------------------
     subsequent  to the date hereof shall propose to (i) pay any dividend to the
                                                      -
     holders of shares of Common Stock or to make any other  distribution to the
     holders of shares of Common Stock (including,  without limitation, any cash
     dividend),  (ii) offer to the holders of shares of Common  Stock  rights to
                  --
     subscribe for or purchase any additional  Shares of the Holding  Company or
     any other  rights or  options,  (iii)  effect any  reclassification  of the
                                      ---
     Shares of the  Holding  Company  (other than a  reclassification  involving
     merely the subdivision or combination of outstanding shares of Common Stock
     referred  to in  section  4.2(a)),  (iv)  engage in any  reorganization  or
                                          --
     recapitalization  or any consolidation or merger,  (v) consummate any sale,
                                                         -
     transfer or other  disposition  of its property,  assets and business as an
     entirety or substantially as an entirety, (vi) effect any other transaction
                                                --
     which might require an  adjustment to the Exercise  Price (or to the number
     or kind of shares of Common Stock, securities or other property deliverable
     upon the exercise of this  Warrant),  including,  without  limitation,  any
     transaction  of the kind  described in section  4.2(g) or (vii) commence or
                                                                ---
     effect the  liquidation,  dissolution or winding up of the Holding Company,
     then, in each such case, the Holding Company shall deliver to the holder of
     this  Warrant  an  Officer's  Certificate  giving  notice of such  proposed
     action,  specifying (A) the date on which the books of the Holding  Company
                          -
     shall close,  or a record shall be taken,  for  determining  the holders of
     Common Stock  entitled to receive such  dividend or other  distribution  or
     such  rights  or  options,  or the  date on  which  such  reclassification,
     reorganization,  recapitalization,  consolidation,  merger, sale, transfer,
     other  disposition,  transaction,  liquidation,  dissolution  or winding up
     shall  take place or  commence,  as the case may be, and (B) the date as of
                                                               -
     which it is  expected  that  holders  of shares of  Common  Stock  shall be
     entitled to receive  shares of Common Stock,  securities or other  property
     deliverable  upon  such  action,  if any  such  date is to be  fixed.  Such
     Officer's  Certificate shall be delivered in the case of any action covered
     by clause (i) or (ii) above,  at least 30 days prior to the record date for
     determining  holders of Common Stock for purposes of receiving such payment
     or offer,  and, in any other case,  at least 30 days prior to the date upon
     which such  action  takes  place and 20 days  prior to any  record  date to
     determine  holders of Common Stock  entitled to receive such  securities or
     other property.


                                  Exhibit 1(b)
                                  ------------

                                      -18-
<PAGE>

          (c) Effect of Failure.  Failure to give any certificate or notice,  or
              -----------------
     any defect in any  certificate  or notice  required  under this section 4.4
     shall not affect the legality or validity of the adjustment of the Exercise
     Price or the number of Warrant  Shares  purchasable  upon  exercise of this
     Warrant.

     4.5.  Adjustments  for Changes in Certain Data. The Holding  Company hereby
           ----------------------------------------
agrees that the initial aggregate number of shares of Common Stock issuable upon
the exercise in full of the  Warrants  issued on the Closing Date to the initial
holders  thereof was 690,134,  which was intended to constitute at least 7.5% of
the Common Stock outstanding  immediately following the Closing (calculated on a
fully-diluted basis and assuming the conversion, exercise and/or exchange of all
securities  convertible  into or exercisable or  exchangeable  for Common Stock,
including,  without limitation,  the Warrants).  If for any reason the shares of
Common Stock purchasable upon the exercise in full of the Warrants issued on the
Closing Date  constituted  less than 7.5% of the Common Stock  outstanding as of
such time (and as so calculated),  the Holding  Company shall forthwith  reissue
each Warrant then outstanding with appropriate adjustments in the Exercise Price
and in the  number of shares of Common  Stock  issuable  upon  exercise  thereof
(together with an Officer's  Certificate  setting forth in reasonable detail the
computation of such  adjustments) and all such adjustments shall be satisfactory
to each holder thereof.

5.   Repurchase; Registration; Transfer Restrictions, etc.   Reference is hereby
     ----------------------------------------------------
made to (a) the Securities  Purchase  Agreements for certain provisions relating
         -
to  the  repurchase  of  the  Warrants   and/or  Warrant  Shares  under  certain
circumstances and (b) the Registration  Rights Agreement for certain  provisions
                   -
relating to the registration rights of the holders of the Registrable Securities
(as defined therein) for certain provisions relating to transfer of the Warrants
and/or the Warrant Shares.

6.   Reservation of Common Stock. The Holding Company has reserved and after the
     ---------------------------
date hereof will at all times reserve and keep  available,  solely for issuance,
sale and delivery  upon the exercise of this  Warrant,  such number of shares of
Common Stock (and/or Other  Securities)  equal to the number of shares of Common
Stock (and/or Other Securities)  issuable upon the exercise of this Warrant. All
such shares of Common Stock (and/or Other  Securities)  shall be duly authorized
and,  when issued upon  exercise of this  Warrant in  accordance  with the terms
hereof,  will be validly issued and fully paid and nonassessable and not subject
to  preemptive  rights on the part of any other  Person  and not  subject to any
Lien, charge or other security interest.


                                  Exhibit 1(b)
                                  ------------

                                      -19-
<PAGE>

7.   Various Covenants of the Holding Company.
     ----------------------------------------

     7.1. No Impairment or Amendment;  No Further Issuances or Sales;  Continued
          ----------------------------------------------------------------------
Validity.  The  Holding  Company  shall not by any  action,  including,  without
--------
limitation,   amending  its  Organizational   Documents,   any   reorganization,
recapitalization,  transfer of assets, consolidation, merger, dissolution, issue
or sale of Shares or other  securities or any other voluntary  action,  avoid or
seek to avoid the observance or performance of any of the terms of this 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  to
protect the rights of the holder hereof against impairment. Without limiting the
generality of the foregoing,  the Holding  Company (a) will take all such action
                                                    -
as may be necessary or appropriate in order that the Holding Company may validly
issue fully paid and nonassessable  Warrant Shares, (b) will obtain and maintain
                                                     -
all such authorizations,  exemptions or consents from any public regulatory body
having jurisdiction as may be necessary to enable the Holding Company to perform
its  obligations  under this  Warrant,  (c) will not enter into any agreement or
                                         -
transaction,  the terms of which would have the effect,  directly or indirectly,
of preventing  the Holding  Company from honoring its  obligations  hereunder or
under any of the other Operative Documents for the benefit of the holders of the
Warrants and/or Warrant Shares, (d) will not amend or modify any term, condition
                                 -
or  provision  of its  Organizational  Documents  in a manner which is, or could
reasonably be expected to be,  adverse in any material  respect to the interests
of any holder of Warrants  and/or Warrant Shares and (e) will not permit the par
                                                      -
value of any Warrant Shares issuable upon exercise of this Warrant to be greater
than the amount payable therefor upon such exercise.

     So long as any  Warrants  or Warrant  Shares are  outstanding,  the Holding
Company will acknowledge in writing,  in form  satisfactory to any holder of any
such  security,  the  continued  validity of the Holding  Company's  obligations
hereunder.

     7.2.  Listing on  Securities  Exchanges,  etc. At all times  following  the
           ---------------------------------------
exercise  of this  Warrant,  the  Holding  Company  will  use  its  commercially
reasonable efforts to maintain the listing of all issued and outstanding Warrant
Shares on each  securities  exchange  or market or trading  system on which such
securities are then or at any time thereafter listed or traded.

     7.3.  Indemnification.  Without limiting the generality of any provision of
           ---------------
the Securities Purchase Agreements or any of the other Operative Documents,  the
Holding  Company  shall  indemnify,  save and hold  harmless  the holder of this
Warrant  and the  holder of any  Warrant  Shares  from and  against  any and all
liability,  loss, cost, damage,  reasonable attorneys' and accountants' fees and
expenses,  court costs and all other out-of-pocket  expenses reasonably incurred
by such holder in connection with preserving, exercising and/or enforcing any of
the terms hereof.

                                  Exhibit 1(b)
                                  ------------

                                      -20-
<PAGE>

     7.4.  Certain Expenses. The Holding Company shall pay all taxes (other than
           ----------------
transfer  taxes and income taxes,  if any,  incurred by the holder hereof or any
transferee)  and other  governmental  charges that may be imposed in respect of,
the issue, sale and delivery of this Warrant and any Warrant Shares.

8.   Miscellaneous.
     -------------

     8.1.  Nonwaiver.  No course of dealing or any delay or failure to  exercise
           ---------
any right,  power or remedy  hereunder on the part of the holder of this Warrant
or of any Warrant  Shares shall  operate as a waiver of or  otherwise  prejudice
such holder's rights, powers or remedies.

     8.2.  Amendment. Any term, covenant, agreement or condition of the Warrants
           ---------
may,  with the  consent  of the  Holding  Company,  be  amended,  or  compliance
therewith may be waived (either generally or in a particular instance and either
retroactively or prospectively), by one or more substantially concurrent written
instruments  signed by the  Required  Holders of the  Warrants  and the  Holding
Company,  provided that (a) no such  amendment or waiver shall change the number
          --------       -
of Warrant  Shares  issuable  upon the  exercise of any Warrant or the manner of
exercise or the amount of any payment due upon  exercise or the  duration of the
Exercise Period, in each case without the prior written consent of the holder of
such  Warrant and (b) no such  amendment or waiver shall extend to or affect any
                   -
obligation  not  expressly  amended  or waived or  impair  any right  consequent
thereon.

     8.3.  Communications.  All  communications  provided  for  herein  shall be
           --------------
delivered,  mailed or sent by facsimile transmission addressed in the manner and
shall  be  effective  as of  the  time  specified  in  the  Securities  Purchase
Agreements.

     8.4.  Like Tenor.  All Warrants shall at all times be identical, except as
           ----------
to the preamble to each Warrant.

     8.5.  Remedies.  No remedy  conferred  in this Warrant on the holder of any
           --------
Warrant or Warrant  Shares is intended to be exclusive of any other remedy,  and
each and every such remedy shall be cumulative and shall be in addition to every
other  remedy  given  hereunder  or  under  any  other  agreement,  document  or
instrument  or now or  hereafter  existing  at law or in equity or by statute or
otherwise.

     8.6.  Successors and Assigns.  This Warrant and the rights evidenced hereby
           ----------------------
shall inure to the benefit of and be binding upon the  successors and assigns of
the Holding  Company,  the holder or holders of this Warrant and, as applicable,
of any Warrant Shares,  to the extent provided herein and in the other Operative
Documents, and shall be enforceable by such holder or holders.


                                  Exhibit 1(b)
                                  ------------

                                      -21-
<PAGE>

     8.7.  Governing Law.   This Warrant, including the validity  hereof and the
           -------------
rights and  obligations of the Holding  Company and of the holder hereof and all
amendments and supplements hereof and all waivers and consents hereunder,  shall
be construed in accordance with and governed by the domestic substantive laws of
the State of New York without giving effect to any choice of law or conflicts of
law  provision  or  rule  that  would  cause  the  application  of the  domestic
substantive laws of any other jurisdiction.

     8.8.  Headings;  Entire Agreement; Partial  Invalidity, etc.   The table of
           ------------------------------------------------------
contents to and headings in this Warrant are for purposes of reference  only and
shall not limit or otherwise affect the meaning hereof.  This Warrant,  together
with  the  other  Operative   Documents,   embodies  the  entire  agreement  and
understanding  between the holder hereof and the Holding  Company and supersedes
all prior agreements and  understandings  relating to the subject matter hereof.
In case any  provision in this Warrant or any of the other  Operative  Documents
shall  be  invalid,  illegal  or  unenforceable,   the  validity,  legality  and
enforceability  of the remaining  provisions shall not in any way be affected or
impaired thereby.

            [The remainder of this page is left blank intentionally.]





                                  Exhibit 1(b)
                                  ------------

                                      -22-
<PAGE>

     IN WITNESS  WHEREOF,  the Holding  Company  has caused  this  Warrant to be
executed as an instrument  under seal by its duly  authorized  officer as of the
date first above written.

                                          UNIDIGITAL INC.



                                          By:
                                             -----------------------------------
                                                                         (Title)







                                  Exhibit 1(b)
                                  ------------

                                      -23-
<PAGE>
                                                                  Exhibit 2.2(a)
                                                                  --------------

                           FORM OF NOTICE OF EXERCISE

               (To be executed only upon partial or full exercise
                             of the within Warrant)



         The  undersigned  registered  holder of the within Warrant  irrevocably
exercises the within Warrant for and purchases            shares of Common Stock
                                              ------------
(or Other Securities)  [Specify  applicable class and/or  kind of securities] of
                        ----------------------------------------------------
UNIDIGITAL INC. and herewith makes payment  therefor in the amount of $        ,
                                                                       --------
all at the price, in the manner and on the terms and conditions specified in the
within  Warrant, and requests that a certificate (or            certificates in
                                                    ------------
denominations of          shares) for such shares  hereby purchased be issued in
                 ---------
the name of and delivered to (choose one) (a) the undersigned or (b)           ,
                                           -                      - -----------
whose address is                                      and, if such shares  shall
                 ------------------------------------
not include all the  Warrant Shares issuable as provided in the within  Warrant,
that a new Warrant of like tenor for the number of Warrant  Shares not being
purchased  hereunder  be issued in the name of and delivered to (choose one) (a)
                                                                              -
the undersigned or (b)                  , whose address is                     .
                    - ------------------                  ----------------------

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

                                       [                                     ]



                                       By
                                         ------------------------------------
                                       (Signature of Registered Holder)



NOTICE:        The signature on this Notice of Exercise must correspond with the
               name as  written  upon the face of the  within  Warrant  in every
               particular,  without  alteration  or  enlargement  or any  change
               whatever.





                                  Exhibit 1(b)
                                  ------------

                                      -24-
<PAGE>
                                                                      Exhibit 3
                                                                      ---------

                               FORM OF ASSIGNMENT

                    (To be executed only upon the assignment
                             of the within Warrant)



         FOR VALUE  RECEIVED,  the undersigned  registered  holder of the within
Warrant hereby sells, assigns and transfers unto                               ,
                                                -------------------------------
whose address is                                                               ,
                ---------------------------------------------------------------
all of the rights of the undersigned under the within Warrant,  with respect to
          shares of Common Stock (or Other Securities) [Specify applicable class
----------                                              ------------------------
and/or kind of  securities]  of  UNIDIGITAL  INC. and, if such shares  shall not
--------------------------
include all the  Warrant Shares issuable as provided in the within Warrant, that
a  new  Warrant  of  like  tenor for  the  number of  Warrant  Shares not  being
transferred hereunder be issued in the name of and delivered to [choose one] (a)
                                                                 ----------   -
the undersigned or (b)                           , whose address is
                    - ---------------------------                  -------------
                                                               , and does hereby
---------------------------------------------------------------
irrevocably constitute and appoint                                   Attorney to
                                  -----------------------------------
register such  transfer on  the  books  of  UNIDIGITAL INC.  maintained for  the
purpose, with full power of substitution in the premises.


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

                                       [                                     ]



                                       By
                                         ------------------------------------
                                        (Signature of Registered Holder)



NOTICE:        The signature on this Assignment must correspond with the name as
               written upon the face of the within Warrant in every  particular,
               without alteration or enlargement or any change whatever.



                                  Exhibit 1(b)
                                  ------------

                                      -25-