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                          REGISTRATION RIGHTS AGREEMENT

                          Dated as of December 10, 1999

                                      among

                           OUTSOURCING SOLUTIONS INC.,
                             a Delaware corporation

                                       AND

                           the Purchasers named herein

                                  Relating to:

                                25,000 Shares of

         Class A 14% Senior Mandatorily Redeemable Preferred Stock, and
                                75,000 Shares of

            Class B 14% Senior Mandatorily Redeemable Preferred Stock


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<PAGE>
               THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement")  is made and
entered  into as of December  10,  1999,  among  Outsourcing  Solutions  Inc., a
Delaware corporation (the "Company"),  and Ares Leveraged Investment Fund, L.P.,
Ares Leveraged Investment Fund II, L.P., DB Capital Investors, L.P., First Union
Investors,  Inc., Abbott Capital 1330 Investors II, L.P., Abbott Capital Private
Equity Fund III, L.P., BNY Partners Fund,  L.L.C.,  Heller  Financial,  Inc. and
Magnetite Asset Investors  L.L.C.  (each a "Purchaser"  and,  collectively,  the
"Purchasers").

               This Agreement is made pursuant to the Purchase Agreement,  dated
as of December 10, 1999,  among the Company and the  Purchasers  (the  "Purchase
Agreement"),  relating  to the  sale  by the  Company  to the  Purchasers  of an
aggregate of (i) 25,000 shares of the Company's  Class A 14% Senior  Mandatorily
Redeemable  Preferred Stock (the "Class A Senior Preferred Stock"),  (ii) 75,000
shares of the  Company's  Class B 14% Senior  Mandatorily  Redeemable  Preferred
Stock (the  "Class B Senior  Preferred  Stock,"  and  together  with the Class A
Senior  Preferred  Stock, the "Senior  Preferred  Stock"),  and (iii) 596,913.07
shares of the Company's  Common Stock (as defined herein) (such shares of Common
Stock, together with the Senior Preferred Stock, the "Purchased Securities"). In
order to induce the Purchasers to enter into the Purchase Agreement, the Company
has agreed to provide to the Holders (as defined herein) the registration rights
for the Registrable  Securities (as defined herein) set forth in this Agreement.
The  execution  of this  Agreement  is a  condition  to the  obligations  of the
Purchasers to purchase the Purchased Securities under the Purchase Agreement.

               In  consideration  of the foregoing,  the parties hereto agree as
follows:

               1.   Definitions.  As   used  in  this  Agreement,  the following
        capitalized defined terms shall have the following meanings:

               "Advice" shall have the meaning ascribed to that term in the last
        paragraph of Section 3.

               "Affiliate"  means, with respect to any specified Person: (i) any
        other Person  directly or  indirectly  controlling  or  controlled by or
        under direct or indirect common control with such specified Person; (ii)
        any other Person that owns, directly or indirectly,  10% or more of such
        specified  Person's Capital Stock; or (iii) any other Person 10% or more
        of the Voting Stock of which is  beneficially  owned or held directly or
        indirectly  by  such  specified   Person.   For  the  purposes  of  this
        definition,  "control"  when used with respect to any  specified  Person
        means the power to direct the  management  and  policies of such Person,
        directly or indirectly,  whether through ownership of voting securities,
        by contract or otherwise;  and the terms  "controlling" and "controlled"
        have  meanings  correlative  to the  foregoing.  With  respect  to  each
        Purchaser,  an Affiliate  shall also include,  without  limitation,  any
        Person  managed by, or  controlling  or under  common  control with such
        Purchaser  or any of its  Affiliates.  Notwithstanding  anything  to the
        contrary  contained  herein,  (x) no  portfolio  company  of the  Equity
        Investor nor any  portfolio  company of a fund managed by or  affiliated
        with the Equity Investor shall be deemed an Affiliate of the Company and
        (y) no Purchaser or any of their  respective  Affiliates shall be deemed
        an Affiliate of the Company.

               "Agreement"  shall have the meaning  ascribed to that term in the
        preamble hereto.

               "Black Out Period"  shall have the meaning  ascribed to that term
        in Section 2.1.

               "Board of  Directors"  shall mean the Board of  Directors  of the
        Company or any authorized committee of such Board of Directors.

               "Business Day" shall mean a day that is not a Legal Holiday.

               "Capital  Stock" shall mean,  (i) with respect to any Person that
        is a corporation,  corporate stock, (ii) with respect to any association
        or business entity,  any and all shares,  interests,  participations  or
        other  equivalents  (however  designated  and  whether or not voting) of
        corporate  stock,  including  each class of common  stock and  preferred
        stock of such  Person;  (iii) with  respect to any Person  that is not a
        corporation,  any  and  all  partnership,  membership  or  other  equity
        interests  of such  Person;  and (iv) any  rights,  warrants  or options
        exchangeable for or convertible into any of the foregoing.

               "Change of Control" shall have the meaning  ascribed to that term
        in the Certificate of Designation for the Senior Preferred Stock.

               "Class A Senior  Preferred Stock" is defined in the first recital
        to this Agreement.

               "Class B Senior  Preferred Stock" is defined in the first recital
        to this Agreement.

               "Common  Stock"  shall mean the  Company's  $.01 par value common
        stock of any class.

               "Company"  shall have the  meaning  ascribed  to that term in the
        preamble hereto and shall also include the Company's successors.

               "Demand" shall have the meaning  ascribed to that term in Section
        2.1.

               "Demand  Registration"  shall have the  meaning  ascribed to that
        term in Section 2.1.

               "Effectiveness  Period"  shall have the meaning  ascribed to that
        term in Section 2.1.

               "Equity Investor"  means  Madison  Dearborn Capital Partners III,
        L.P.

               "Exchange Act" shall mean the Securities Exchange Act of 1934, as
        amended,   and  the  rules  and  regulations   promulgated  by  the  SEC
        thereunder.

               "Holder"  shall mean each of the  Purchasers,  for so long as the
        Purchasers own any Registrable Securities, and their successors, assigns
        and direct and  indirect  transferees  who become  registered  owners of
        Registrable Securities.

               "Initial  Public Equity  Offering"  means a primary  underwritten
        public  offering (but excluding any offering  pursuant to Form S-8 under
        the Securities Act or any other publicly registered offering pursuant to
        the  Securities  Act pertaining to an issuance of shares of Common Stock
        or securities  exercisable  therefor  under any benefit  plan,  employee
        compensation  plan,  or  employee or director  stock  purchase  plan) of
        Common  Stock  of the  Company  pursuant  to an  effective  registration
        statement under the Securities Act.

               "Issue Date" means December 10, 1999.

               "Legal Holiday" shall mean a Saturday, a Sunday or a day on which
        banking  institutions  in The City of New York or at a place of  payment
        are authorized by law, regulation or executive order to remain closed.

               "Lock Up Period" shall have the meaning  ascribed to that term in
        Section 2.1.

               "Person"  shall  mean an  individual,  corporation,  partnership,
        limited  liability  company,  joint  venture,  association,  joint-stock
        company, trust,  unincorporated  organization or government or agency or
        political subdivision thereof.

               "Piggy-Back Registration" shall have the meaning ascribed to that
        term in Section 2.2.

               "Postponement  Period"  shall have the  meaning  ascribed to that
        term in Section 2.1.

               "Preferred  Stock"  means,  with  respect to any Person,  Capital
        Stock of any class or classes (however  designated) of such Person which
        is preferred as to the payment of dividends or  distributions,  or as to
        the distribution of assets upon any voluntary or involuntary liquidation
        or dissolution of such Person,  over Capital Stock of any other class of
        such Person.  With respect to the Company,  the term  "Preferred  Stock"
        shall include the Senior Preferred Stock.

               "Prospectus"  means the prospectus  included in any  Registration
        Statement  (including,  without limitation,  a prospectus that discloses
        information  previously  omitted from a  prospectus  filed as part of an
        effective  registration statement in reliance upon Rule 430A promulgated
        pursuant  to the  Securities  Act),  as amended or  supplemented  by any
        prospectus supplement,  with respect to the terms of the offering of any
        portion  of the  Registrable  Securities  covered  by such  Registration
        Statement,  and  all  other  amendments  and  supplements  to  any  such
        prospectus,   including  post-effective  amendments,  and  all  material
        incorporated by reference or deemed to be incorporated by reference,  if
        any, in such prospectus.

               "Purchase Agreement" shall have the meaning ascribed to that term
        in the preamble hereto.

               "Purchased  Securities"  shall have the meaning  ascribed to that
        term in the preamble hereto.

               "Purchasers"  shall have the meaning ascribed to that term in the
        preamble hereto.

               "Registrable  Securities" shall mean any of the Shares. As to any
        particular  Registrable  Securities,  once issued such securities  shall
        cease to be Registrable  Securities  when (a) a  Registration  Statement
        with respect to the sale of such  securities by the Holder thereof shall
        have  been  declared   effective  under  the  Securities  Act  and  such
        securities shall have been disposed of by such Holder in accordance with
        such Registration  Statement,  (b) such securities have been distributed
        to the  public  pursuant  to  Rule  144  (or  any  successor  provision)
        promulgated  under the Securities  Act, (c) such  securities  shall have
        been otherwise  transferred and new  certificates for them not bearing a
        legend  restricting  further  transfer  shall have been delivered by the
        Company and subsequent  disposition of such securities shall not require
        registration  or  qualification  under the Securities Act or any similar
        state law then in force or (d) such  securities  shall have ceased to be
        outstanding.

               "Registration  Expenses" shall mean all expenses  incident to the
        Company's  performance of or compliance with this Agreement,  including,
        without limitation,  all SEC and stock exchange or National  Association
        of Securities Dealers,  Inc.  registration and filing fees and expenses,
        fees  and  expenses  of  compliance  with  securities  or Blue  Sky laws
        (including,   without  limitation,  in  the  event  of  an  underwritten
        offering,   reasonable  fees  and   disbursements  of  counsel  for  the
        underwriters in connection with Blue Sky qualifications,  if any, of the
        Registrable   Securities),   rating  agency  fees,   printing  expenses,
        messenger,  telephone and delivery  expenses,  fees and disbursements of
        counsel   for  the  Company  and  all   independent   certified   public
        accountants, and, in the event of an underwritten offering, the fees and
        disbursements of underwriters  customarily paid by issuers or sellers of
        securities  (but  not  including  (i)  any  underwriting   discounts  or
        commissions  or  transfer  taxes,  if any,  attributable  to the sale of
        Registrable Securities by Holders of such Registrable Securities or (ii)
        fees and expenses of counsel and/or experts for the Holders).

               "Registration Statement" shall mean any registration statement of
        the Company which covers any of the Registrable  Securities  pursuant to
        the provisions of this  Agreement and all amendments and  supplements to
        any such Registration Statement, including post-effective amendments, in
        each case  including  the  Prospectus  contained  therein,  all exhibits
        thereto and all material incorporated by reference therein.

               "Requisite Shares" shall mean a number of Registrable  Securities
        equivalent  to  not  less  than  35%  of  the   Registrable   Securities
        outstanding as of any date of determination.

               "Rule 144" shall mean Rule 144 under the  Securities  Act (or any
        successor provision), as it may be amended from time to time.

               "Rule 144A" shall mean Rule 144A under the Securities Act (or any
        successor provision), as it may be amended from time to time.

               "SEC" shall mean the Securities and Exchange Commission,  as from
        time to time  constituted,  created under the Exchange Act or, if at any
        time  after the  execution  of this  Agreement  such  Commission  is not
        existing and performing the duties now assigned to it under the Exchange
        Act, the body performing such duties at such time.

               "Securities" shall mean the Senior Preferred Stock, Common Stock,
        any preferred or common stock  equivalents,  participations or interests
        and any options,  warrants or securities convertible into or exercisable
        or  exchangeable  for  Senior  Preferred  Stock or  Common  Stock or any
        preferred or common stock equivalents, participations or interests.

               "Securities  Act"  shall  mean the  Securities  Act of  1933,  as
        amended,   and  the  rules  and  regulations   promulgated  by  the  SEC
        thereunder.

               "Senior  Preferred Stock" shall have the meaning ascribed to that
        term in the preamble hereto.

               "Shares"  shall mean (a) the Senior  Preferred  Stock sold to the
        Purchasers  pursuant to the Purchase  Agreement,  whether held by any of
        them  or any  subsequent  assignee  or  transferee  and  (b)  any  other
        securities  issued or issuable  with  respect to or in exchange  for the
        Senior  Preferred  Stock by way of stock  dividend  or stock split or in
        connection  with a  combination  of  shares,  recapitalization,  merger,
        consolidation or other reorganization or otherwise.

               "Voting  Stock" shall mean any class or classes of Capital  Stock
        pursuant to which the holders  thereof  have the  general  voting  power
        under ordinary  circumstances  to elect at least a majority of the Board
        of  Directors,  managers  or  trustees  of any Person  (irrespective  of
        whether or not, at the time,  stock of any other class or classes  shall
        have,  or might have,  voting  power by reason of the  happening  of any
        contingency).

               "Withdrawal  Election"  shall have the  meaning  ascribed to that
        term in Section 2.3.

               2.   Registration Rights and Other Rights and Obligations of  the
        Holders.

               2.1. Demand Registration.  (a) Request for  Registration.  At any
time on or after the first year  anniversary of the Issue Date,  Holders owning,
individually or in the aggregate,  at least the Requisite  Shares may make up to
two written requests (a "Demand") for  registration  under the Securities Act of
their  Registrable  Securities (a "Demand  Registration").  Any such Demand will
specify the number of Registrable  Securities  proposed to be sold and will also
specify  the  intended  method  of  disposition  thereof.  Subject  to the other
provisions  of this Section 2.1, the Company  shall give written  notice of such
Demand within 10 days after the receipt thereof to all other Holders.  Within 30
days after  receipt of such  notice by any  Holder,  such  Holder may request in
writing that its Registrable Securities be included in such registration and the
Company shall include in the Demand  Registration the Registrable  Securities of
any such selling Holder  requested to be so included.  Each such request by such
other  selling  Holders  shall  specify  the  number of  Registrable  Securities
proposed  to be sold and the  intended  method of  disposition  thereof.  Upon a
Demand, the Company will (i) prepare,  file and use its commercially  reasonable
efforts  to  cause  to  become  effective  within  90  days  of  such  Demand  a
Registration  Statement  in  respect  of all the  Registrable  Securities  which
Holders  request for  inclusion  therein;  provided  that if such Demand  occurs
during a Black Out Period or a period (not to exceed 180 days)  during which the
Company is  prohibited or restricted  from issuing or selling  Senior  Preferred
Stock  pursuant  to  any  underwriting  or  purchase  agreement  relating  to an
underwritten public offering of Senior Preferred Stock or securities convertible
into or  exchangeable  for Senior  Preferred Stock under Rule 144A or registered
under the Securities Act or any agreement with a  securityholder  of the Company
exercising registration rights pursuant to an agreement in existence on the date
hereof (a "Lock Up  Period"),  the  Company  shall not be required to notify the
Holders of such Demand or file such  Registration  Statement prior to the end of
the Black Out Period or Lock Up Period,  as the case may be, in which event, the
Company will use its commercially  reasonable efforts to cause such Registration
Statement  to become  effective no later than 90 days after the end of the Black
Out  Period  or Lock  Up  Period,  as the  case  may  be,  and  (ii)  keep  such
Registration   Statement  effective  for  the  shorter  of  (a)  180  days  (the
"Effectiveness  Period")  and (b) such period of time as all of the  Registrable
Securities  included in such  Registration  Statement have been sold thereunder.
Notwithstanding  anything set forth in the immediately  preceding sentence,  the
Company may (I) postpone the filing  period,  suspend the  effectiveness  of any
registration,  suspend  the use of any  Prospectus  and shall not be required to
amend or supplement the Registration  Statement,  any related  Prospectus or any
document incorporated therein by reference (other than an effective registration
statement being used for an underwritten  offering) in the event that, and for a
period,  in the case of any  particular  Demand  Registration,  not to exceed an
aggregate of 90 days ("Black Out Period") (i) an event or circumstance occurs as
a result of which the  Registration  Statement,  any related  Prospectus  or any
document  incorporated  therein by  reference  as then  amended or  supplemented
would,  in the Company's good faith judgment,  contain an untrue  statement of a
material  fact or omit to state a material  fact  necessary in order to make the
statements  therein,  in the light of the  circumstances  under  which they were
made,  not  misleading,  and (ii)(A) the  Company  determines  in its good faith
judgment  that the  disclosure  of such event at such time would have a material
adverse  effect on the  business,  operations or prospects of the Company or (B)
the disclosure otherwise relates to a material business transaction or any other
material matter, which has not yet been publicly disclosed;  provided,  further,
that,  if the  effectiveness  of any  Registration  Statement  is suspended as a
result of a Black Out Period, the Effectiveness  Period shall be extended by the
number of days in any Black Out  Period and (II) at any time prior to an Initial
Public Offering by the Company,  postpone the filing of one Demand Registration,
by giving written  notice thereof to all Holders,  for a period not to exceed an
aggregate of 180 days ("Postponement Period");  provided, that at the end of the
Postponement Period the Company will use its commercially  reasonable efforts to
cause a  Registration  Statement with respect to all  Registrable  Securities of
Holders electing to participate in such Demand  Registration to become effective
within 90 days after the end of the Postponement Period.

               In the event of the  occurrence of any Black Out Period during an
Effectiveness  Period or Lock Up Period,  the Company will  promptly  notify the
Holders of Registrable Securities thereof in writing.

               Upon a Demand, the Company may elect, at its option, to effect an
A/B exchange within the time periods referred to above, which shall be deemed to
satisfy the Company's obligations to effect a registration under this Agreement.

               (b)  Effective  Registration.  Except  as  specifically  provided
herein,  the Company is only required to effect two Demand  Registrations  under
this  Agreement  (whether  or not all of the Holders of  Registrable  Securities
elect to participate in such Demand Registration on the basis set forth herein).
A  registration   will  not  be  deemed  to  have  been  effected  as  a  Demand
Registration,  and thereby satisfy the obligation hereunder,  unless it has been
declared  effective  by the SEC and the  Company has  complied  in all  material
respects  with its  obligations  under  this  Agreement  with  respect  thereto;
provided  that if, after it has become  effective,  the offering of  Registrable
Securities  pursuant to such  registration is or becomes the subject of any stop
order,  injunction  or  other  order  or  requirement  of the  SEC or any  other
governmental  or  administrative  agency,  or if any court prevents or otherwise
limits the sale of Registrable  Securities pursuant to the registration (for any
reason  other than the act or  omissions  of the Holders) for the period of time
contemplated hereby, such registration will be deemed not to have been effected.
If (i) a  registration  requested  pursuant to this Section 2.1 is deemed not to
have been effected or (ii) the registration  requested  pursuant to this Section
2.1 does not remain  effective for the  Effectiveness  Period,  then the Company
shall not be deemed to have effected a Demand  Registration  and its obligations
pursuant  to  this  Section  2.1  will  continue.  The  Holders  of  Registrable
Securities  shall be permitted  to withdraw  all or any part of the  Registrable
Securities from a Demand Registration at any time prior to the effective date of
such  Demand  Registration.  If at any time a  Registration  Statement  is filed
pursuant to a Demand  Registration,  and subsequently a sufficient number of the
Registrable  Securities are withdrawn from the Demand  Registration so that such
Registration  Statement does not cover that number of Registrable  Securities at
least equal to one-half of the  Registrable  Securities  outstanding  as of such
date, the Holders who have not withdrawn their Registrable Securities shall have
the opportunity to include an additional number of Registrable Securities in the
Demand  Registration so that such  Registration  Statement covers that number of
Registrable  Securities at least equal to one-half of the Registrable Securities
outstanding as of such date. If an additional  number of Registrable  Securities
is not so included,  the Company may withdraw the Registration  Statement.  Such
withdrawn Registration Statement will not count as a Demand Registration and the
Company shall continue to be obligated to effect such  registration  pursuant to
this Section 2.1.  Except as set forth in the last  sentence of Section  2.1(c),
without  the prior  written  consent of the Holders of the  Requisite  Shares no
other  securityholder  of the  Company  shall  be  permitted  to  include  their
securities in a Demand Registration.

               (c) Priority in Demand Registrations  Pursuant to Section 2.1. If
a Demand  Registration  pursuant to this  Section 2.1  involves an  underwritten
offering and the lead managing  underwriter advises the Company in writing that,
in its view, the number of Registrable Securities requested by the Holders to be
included in such registration,  together with any other securities  permitted to
be included in such  registration  exceeds the number which, in the view of such
lead  managing  underwriter,  can  be  sold,  the  number  of  such  Registrable
Securities to be included in such registration shall be allocated pro rata among
all  requesting  Holders  on the basis of the  relative  number  of  Registrable
Securities  then  held  by each  such  Holder  (provided  that  any  Registrable
Securities  thereby  allocated  to any such Holder  that  exceed  such  Holder's
request  shall be  reallocated  among the remaining  requesting  Holders in like
manner). In the event that the number of Registrable  Securities requested to be
included in such  registration is less than the number which, in the view of the
lead  managing  underwriter,  can be  sold,  the  Company  may  include  in such
registration  the  Securities  the Company  proposes to sell up to the number of
Securities  that,  in the view of the  lead  managing  underwriter,  can be sold
without adversely affecting the success of the offering,  including the price at
which the Registrable Securities can be sold.

               (d)  Selection  of  Underwriter.  If the  Holders  so elect,  the
offering of Registrable Securities pursuant to a Demand Registration shall be in
the  form  of an  underwritten  offering.  The  Holders  of a  majority  of  the
Registrable  Securities to be sold in such Demand  Registration shall select one
or more nationally  recognized firms of investment  bankers (to whom the Company
shall  not have  reasonably  objected)  to act as the  managing  underwriter  or
underwriters  in connection  with such offering and shall select any  additional
investment bankers and managers to be used in connection with the offering.

               (e) Expenses.  The Company will pay all Registration  Expenses in
connection with the  registrations  requested  pursuant to Section 2.1(a).  Each
Holder shall pay all underwriting  discounts and commissions and transfer taxes,
if any,  relating  to the  sale or  disposition  of  such  Holder's  Registrable
Securities  pursuant to any registration  statement  requested  pursuant to this
Section 2.1.

               2.2.  Piggy-Back  Registration.   If  at  any  time  the  Company
proposes to file a Registration  Statement under the Securities Act with respect
to an offering by the Company for its own account of any Securities  (including,
but not limited to, an Initial Public Equity Offering) or for the account of any
of  its  respective   securityholders  of  any  Securities  (other  than  (i)  a
registration  statement on Form S-4 or S-8 (or any substitute  forms that may be
adopted by the SEC),  (ii) a registration  statement filed in connection with an
offer or offering of securities solely to the Company's existing securityholders
or (iii) a Demand  Registration),  then the Company shall give written notice of
such  proposed  filing  to the  Holders  of  Registrable  Securities  as soon as
practicable  (but in no event less than 20 Business Days before the  anticipated
filing  date),  and such notice  shall offer such  Holders  the  opportunity  to
register such number of  Registrable  Securities as each such Holder may request
(which request shall specify the Registrable  Securities intended to be disposed
of  by  such  Holder  and  the  intended  method  of  distribution  thereof)  (a
"Piggy-Back Registration").  The Company shall use its best efforts to cause the
managing underwriter or underwriters of such proposed  underwritten  offering to
permit the  Registrable  Securities  requested  to be included  in a  Piggy-Back
Registration  to be  included  on the same terms and  conditions  as any similar
securities of the Company or any other  securityholder  included  therein and to
permit  the  sale  or  other  disposition  of  such  Registrable  Securities  in
accordance with the intended method of distribution thereof; provided,  however,
in no event shall the  Company be  required  to reduce the number of  securities
proposed to be sold by the Company or alter the terms of the securities proposed
to be sold by the  Company  in order  to  induce  the  managing  underwriter  or
underwriters to permit Registrable  Securities to be included.  Any Holder shall
have the  right  to  withdraw  its  request  for  inclusion  of its  Registrable
Securities in any Registration  Statement pursuant to this Section 2.2 by giving
written  notice  to  the  Company  of  its  request  to  withdraw  prior  to the
effectiveness  of  the  Registration  Statement.  The  Company  may  withdraw  a
Piggy-Back  Registration  at any time  prior to the time it  becomes  effective;
provided  that the Company  shall give prompt  notice  thereof to  participating
Holders. The Company will pay all Registration  Expenses in connection with each
registration of Registrable  Securities  requested pursuant to this Section 2.2,
and each  Holder  shall  pay all  underwriting  discounts  and  commissions  and
transfer  taxes,  if any,  relating to the sale or  disposition of such Holder's
Registrable Securities pursuant to a Registration Statement effected pursuant to
this Section 2.2.

               No  registration  effected under this Section 2.2, and no failure
to effect a  registration  under this Section 2.2,  shall relieve the Company of
its obligation to effect a registration  upon the request of Holders pursuant to
Section 2.1, and no failure to effect a registration  under this Section 2.2 and
to complete the sale of  Registrable  Securities in connection  therewith  shall
relieve the Company of any other obligation under this Agreement.

               2.3. Reduction of Offering. If the lead managing  underwriter  of
any underwritten offering described in Section 2.2 has informed, in writing, the
Holders of the Registrable Securities requesting inclusion in such offering that
it is its view  that the total  number of  securities  which  the  Company,  the
Holders and any other  Persons  desiring  to  participate  in such  registration
intend to include in such offering is such as to materially and adversely affect
the success of such offering,  including the price at which such  securities can
be sold, then:  first,  the securities other than Registrable  Securities of the
Holders and securities of the Company included in such offering shall be reduced
in their entirety before any reduction of Registrable Securities; and second, to
the  extent  the  reduction  set forth in the  immediately  preceding  clause is
insufficient to reduce the number of securities  requested for inclusion in such
offering to a number, which, in the view of the lead managing  underwriter,  can
be sold without materially and adversely  affecting the success of the offering,
the  number of  Registrable  Securities  to be offered  for the  account of such
Holders  participating in such registration shall be reduced or limited pro rata
in proportion to the respective number of securities  requested to be registered
to the extent  necessary  to reduce the total number of  Registrable  Securities
requested to be included in such offering to the number of  securities,  if any,
recommended by such lead managing underwriter. If a reduction in the Registrable
Securities  pursuant  to this  paragraph  would,  in the  judgment  of the  lead
managing  underwriter,  be insufficient to  substantially  eliminate the adverse
effect that  inclusion of the  Registrable  Securities  requested to be included
would have on such offering,  such Registrable  Securities will be excluded from
such offering. In no event shall the Company be required to reduce the number of
securities to be sold by it in the offering.

               If, as a result of the proration  provisions of this Section 2.3,
any Holder  shall not be  entitled to include all  Registrable  Securities  in a
Piggy-Back  Registration  that such Holder has  requested to be  included,  such
Holder may elect to withdraw his request to include  Registrable  Securities  in
such registration (a "Withdrawal Election"); provided that a Withdrawal Election
shall be made prior to the effectiveness of the Registration Statement and shall
be irrevocable and, after making a Withdrawal Election, a Holder shall no longer
have any right to include Registrable Securities in the registration as to which
such Withdrawal Election was made.

               2.4. Lock-Up of Holders. If the Company has complied with  all of
its  obligations  with  respect  to  a  Demand   Registration  or  a  Piggy-Back
Registration that is a firm commitment underwritten public offering, all Holders
of Registrable  Securities,  upon request of the lead managing  underwriter with
respect to such  underwritten  public  offering,  agree not to sell or otherwise
dispose of any Registrable  Security owned by them for a period not to exceed 90
days from the consummation of such underwritten  public offering;  provided that
Registrable  Securities  which  had been  requested  for  inclusion  in a Demand
Registration  or a  Piggy-Back  Registration  but  which  were  not so  included
pursuant  to  Section  2.1(c)  or  Section  2.3  shall  only be  subject  to the
restriction  on sale and  disposition  in this  Section  2.4 for a period not to
exceed 60 days from the consummation of such underwritten public offering.

               3.   Registration Procedures.


               In connection with the obligations of the Company with respect to
any Registration  Statement pursuant to Sections 2.1 and 2.2 hereof, the Company
shall:

               (a) A reasonable  period of time prior to the initial filing of a
          Registration  Statement or Prospectus and a reasonable  period of time
          prior to the filing of any amendment or supplement thereto, furnish to
          the   Holders  of  the   Registrable   Securities   included  in  such
          Registration Statement, and the managing underwriters,  if any, copies
          of all such documents  proposed to be filed,  which  documents  (other
          than those  incorporated  or deemed to be  incorporated  by reference)
          will be subject to the review of such Holders,  and such underwriters,
          if any, and use  reasonable  commercial  efforts to cause the officers
          and directors of the Company,  counsel to the Company and  independent
          certified  public  accountants  to the  Company  to  respond  to  such
          reasonable  inquiries  as shall be  necessary,  in the  opinion of the
          respective counsel to such Holders and such underwriters, to conduct a
          reasonable investigation within the meaning of the Securities Act. The
          Company  shall not file any such  Registration  Statement  or  related
          Prospectus  or any  amendments  or  supplements  thereto  to which the
          Holders of a majority of the Registrable  Securities  included in such
          Registration Statement shall reasonably object on a timely basis;

               (b)  Prepare  and file  with the SEC such  amendments,  including
          post-effective  amendments,  to each Registration  Statement as may be
          necessary to keep such Registration  Statement  continuously effective
          for the applicable time period required  hereunder;  cause the related
          Prospectus to be supplemented by any required  Prospectus  supplement,
          and as so  supplemented  to be filed  pursuant  to Rule 424  under the
          Securities  Act; and comply with the  provisions of the Securities Act
          and the Exchange Act with respect to the disposition of all securities
          covered  by  such   Registration   Statement  during  such  period  in
          accordance  with the intended  methods of  disposition  by the sellers
          thereof set forth in such  Registration  Statement as so amended or in
          such Prospectus as so supplemented;

               (c) Notify the Holders of  Registrable  Securities to be sold and
          the managing underwriters,  if any, promptly, and (if requested by any
          such Person), confirm such notice in writing, (i)(A) when a Prospectus
          or any Prospectus  supplement or post-effective  amendment is proposed
          to be filed and (B) with  respect to a  Registration  Statement or any
          post-effective  amendment, when the same has become effective, (ii) of
          any  request  by the SEC or any other  Federal  or state  governmental
          authority for amendments or supplements to a Registration Statement or
          related  Prospectus  or  for  additional  information,  (iii)  of  the
          issuance  by the SEC,  any  state  securities  commission,  any  other
          governmental  agency  or  any  court  of  any  stop  order,  order  or
          injunction  suspending  or enjoining  the use of a  Prospectus  or the
          effectiveness  of a  Registration  Statement or the  initiation of any
          proceedings  for that  purpose,  (iv) of the receipt by the Company of
          any notification  with respect to the suspension of the  qualification
          or exemption from  qualification of any of the Registrable  Securities
          for sale in any jurisdiction,  or the initiation or threatening of any
          proceeding for such purpose,  and (v) of the happening of any event or
          information  becoming  known  that  makes  any  statement  made  in  a
          Registration  Statement or related  Prospectus  untrue in any material
          respect  or  that   requires   the  making  of  any  changes  in  such
          Registration  Statement  or  Prospectus  so  that,  in the  case  of a
          Registration  Statement, it will not contain any untrue statement of a
          material fact or omit to state any material fact required to be stated
          therein or necessary to make the statements  therein,  in light of the
          circumstances under which they were made, not misleading,  and that in
          the case of a Prospectus,  it will not contain any untrue statement of
          a material  fact or omit to state any  material  fact  required  to be
          stated therein or necessary to make the statements  therein,  in light
          of the circumstances under which they were made, not misleading;

               (d) Use its commercially reasonable efforts to avoid the issuance
          of or, if issued,  obtain the  withdrawal  of any order  enjoining  or
          suspending  the  use  of  a  Prospectus  or  the  effectiveness  of  a
          Registration  Statement  or  the  lifting  of  any  suspension  of the
          qualification  (or  exemption  from   qualification)  of  any  of  the
          Registrable  Securities  for  sale in any  jurisdiction  described  in
          Section 3(h), at the earliest practicable moment;

               (e) If requested by the lead managing  underwriters,  if any, (i)
          promptly  incorporate  in a Prospectus  supplement  or  post-effective
          amendment  such  information  as the  managing  underwriters,  if any,
          reasonably  believe  should  be  included  therein,  and (ii) make all
          required filings of such Prospectus  supplement or such post-effective
          amendment  under the Securities  Act as soon as practicable  after the
          Company has received notification of the matters to be incorporated in
          such  Prospectus  supplement or  post-effective  amendment;  provided,
          however,  that the  Company shall  not  be required to take any action
          pursuant  to this  Section  3(e) that would, in the opinion of counsel
          for the Company, violate applicable law;

               (f) Upon written  request to the Company,  furnish to each Holder
          of  Registrable  Securities  to be  sold  pursuant  to a  Registration
          Statement and each managing  underwriter,  if any, without charge,  at
          least  one  conformed  copy of such  Registration  Statement  and each
          amendment thereto,  including financial statements and schedules,  all
          documents  incorporated  or  deemed  to  be  incorporated  therein  by
          reference,  and all exhibits to the extent requested  (including those
          previously   furnished  or  incorporated  by  reference)  as  soon  as
          practicable after the filing of such documents with the SEC;

               (g) Deliver to each Holder of  Registrable  Securities to be sold
          pursuant to a Registration  Statement,  and the underwriters,  if any,
          without charge, as many copies of the Prospectus  (including each form
          of  prospectus)  and each  amendment  or  supplement  thereto  as such
          persons reasonably request; and the Company hereby consents to the use
          of such Prospectus and each amendment or supplement thereto by each of
          the selling Holders of Registrable Securities and the underwriters, if
          any,  in  connection  with the  offering  and sale of the  Registrable
          Securities  covered by such Prospectus and any amendment or supplement
          thereto;

               (h) Prior to any public offering of Registrable  Securities,  use
          its  commercially   reasonable  efforts  to  register  or  qualify  or
          cooperate with the Holders of  Registrable  Securities to be sold, the
          underwriters,  if any, and their respective counsel in connection with
          the registration or qualification (or exemption from such registration
          or  qualification)  of such Registrable  Securities for offer and sale
          under the  securities  or Blue Sky laws of such  jurisdictions  as any
          such Holder or underwriter  reasonably requests in writing;  keep each
          such registration or qualification (or exemption  therefrom) effective
          during the period such  Registration  Statement is required to be kept
          effective  hereunder and do any and all other acts or things necessary
          or advisable to enable the  disposition in such  jurisdictions  of the
          Registrable   Securities   covered  by  the  applicable   Registration
          Statement;  provided,  however, that the Company shall not be required
          to (i) qualify  generally to do business in any jurisdiction  where it
          is not then so qualified  or (ii) take any action which would  subject
          it to general  service of process or to taxation  in any  jurisdiction
          where they are not so subject;

               (i) In  connection  with  any  sale or  transfer  of  Registrable
          Securities  that  will  result  in such  Securities  no  longer  being
          Registrable  Securities,  cooperate  with the Holders  thereof and the
          managing  underwriters,  if any, to facilitate the timely  preparation
          and delivery of certificates representing Registrable Securities to be
          sold, which  certificates  shall not bear any restrictive  legends and
          shall be in a form  eligible  for deposit  with The  Depository  Trust
          Company,  and to  enable  such  Registrable  Securities  to be in such
          denominations   and   registered   in  such  names  as  the   managing
          underwriters,  if any,  or such  Holders  may  request  at  least  two
          Business Days prior to any sale of Registrable Securities;

               (j) Upon the  occurrence  of any event  contemplated  by  Section
          3(c)(v),   as  promptly  as  practicable,   prepare  a  supplement  or
          amendment,  including, if appropriate,  a post-effective amendment, to
          each Registration  Statement or a supplement to the related Prospectus
          or any document  incorporated or deemed to be incorporated  therein by
          reference, and file any other required document so that, as thereafter
          delivered,  such Prospectus will not contain an untrue  statement of a
          material  fact or omit to state a material  fact required to be stated
          therein or necessary to make the statements  therein,  in light of the
          circumstances under which they were made, not misleading;

               (k)  Enter  into  such  agreements   (including  an  underwriting
          agreement in form, scope and substance as is customary in underwritten
          offerings)  and take all such other  reasonable  actions in connection
          therewith  (including  those  reasonably  requested  by  the  managing
          underwriters,   if  any)  in  order  to  expedite  or  facilitate  the
          disposition of such  Registrable  Securities,  and,  whether or not an
          underwriting  agreement  is  entered  into  and  whether  or  not  the
          registration   is  an   underwritten   registration:   (i)  make  such
          representations   and  warranties  to  the  underwriters  and  selling
          Holders,  if any,  with respect to the business of the Company and its
          subsidiaries  (including with respect to businesses or assets acquired
          or to be acquired  by any of them),  and the  Registration  Statement,
          Prospectus  and  documents,  if  any,  incorporated  or  deemed  to be
          incorporated by reference  therein,  in each case, in form,  substance
          and  scope as are  customarily  made by  issuers  to  underwriters  in
          underwritten  offerings,  and confirm the same if and when  requested;
          (ii) obtain  opinions  of counsel to the  Company and updates  thereof
          (which counsel and opinions (in form,  scope and  substance)  shall be
          reasonably satisfactory to the managing underwriters if any, addressed
          to each of the underwriters,  and selling Holders,  if any),  covering
          the matters  customarily covered in opinions requested in underwritten
          offerings  and such other  matters as may be  reasonably  requested by
          such  underwriters or selling  Holders;  (iii) use their  commercially
          reasonable  efforts to obtain  customary  "cold  comfort"  letters and
          updates thereof from the independent  certified public  accountants of
          the Company (and, if necessary, any other independent certified public
          accountants  of any  subsidiary  of  the  Company  or of any  business
          acquired by the Company for which  financial  statements and financial
          data  is,  or  is  required  to  be,  included  in  the   Registration
          Statement),  addressed  (where  reasonably  possible)  to  each of the
          underwriters  and  selling  Holders,  if any,  such  letters  to be in
          customary form and covering matters of the type customarily covered in
          "cold comfort" letters in connection with underwritten offerings; (iv)
          if an  underwriting  agreement is entered into, the same shall contain
          indemnification  provisions  and  procedures no less  favorable to the
          underwriters,  if any,  than  those set forth in  Section 4 hereof (or
          such  other  provisions  and  procedures  acceptable  to the  managing
          underwriters, if any); and (v) deliver such documents and certificates
          as may be reasonably requested by the managing  underwriters,  if any,
          to  evidence  the  continued  validity  of  the   representations  and
          warranties   made  pursuant  to  clause  (i)  above  and  to  evidence
          compliance with any customary conditions contained in the underwriting
          agreement or other agreement entered into by the Company;

               (l) Make  available  for  inspection by a  representative  of any
          underwriter  participating  in any  such  disposition  of  Registrable
          Securities,  and any attorney,  consultant  or accountant  retained by
          such selling  Holders or  underwriter,  at the offices where  normally
          kept,  during reasonable  business hours, all pertinent  financial and
          other records,  corporate  documents and properties of the Company and
          its  subsidiaries  (including  with respect to  businesses  and assets
          acquired  or to be acquired  to the extent  that such  information  is
          available to the Company), and cause the officers,  directors,  agents
          and  employees  of the Company and its  subsidiaries  (including  with
          respect to  businesses  and assets  acquired  or to be acquired to the
          extent that such  information  is  available to the Company) to supply
          all  information  in  each  case  reasonably  requested  by  any  such
          representative,  underwriter,  attorney,  consultant  or accountant in
          connection with such Registration Statement;  provided,  however, that
          such  Persons  shall first agree in writing  with the Company that any
          information  that is  reasonably  and in good faith  designated by the
          Company in writing as  confidential  at the time of  delivery  of such
          information  shall be kept  confidential  by such Persons,  unless (i)
          disclosure of such information is required by court or  administrative
          order  or  is  necessary   to  respond  to  inquiries  of   regulatory
          authorities,  (ii)  disclosure of such  information is required by law
          (including any disclosure  requirements pursuant to Federal securities
          laws in connection  with the filing of the  Registration  Statement or
          the use of any Prospectus),  (iii) such information  becomes generally
          available  to the  public  other than as a result of a  disclosure  or
          failure to  safeguard  such  information  by such  Person or (iv) such
          information  becomes available to such Person from a source other than
          the  Company  and its  subsidiaries  and such source is not bound by a
          confidentiality agreement;

               (m) Comply with all applicable  rules and  regulations of the SEC
          and  make  generally  available  to  their  securityholders   earnings
          statements   satisfying   the  provisions  of  Section  11(a)  of  the
          Securities Act and Rule 158 under the Securities Act, no later than 45
          days after the end of any 12-month period (or 90 days after the end of
          any 12-month period if such period is a fiscal year) (i) commencing at
          the end of any fiscal quarter in which Registrable Securities are sold
          to   underwriters   in  a  firm   commitment  or  reasonable   efforts
          underwritten  offering and (ii) if not sold to underwriters in such an
          offering,  commencing  on the first day of the  first  fiscal  quarter
          after the effective date of a Registration Statement,  which statement
          shall cover said period,  consistent with the requirements of Rule 158
          under the Securities Act; and

               (n) Cooperate with each seller of Registrable  Securities covered
          by  any  Registration   Statement  and  each   underwriter,   if  any,
          participating  in the disposition of such  Registrable  Securities and
          their respective counsel in connection with any filings required to be
          made with the National Association of Securities Dealers, Inc.

               The Company may require a Holder of Registrable  Securities to be
included in a Registration  Statement to furnish to the Company such information
regarding (i) the intended method of distribution of such Registrable Securities
(ii) such Holder and (iii) the Registrable  Securities held by such Holder as is
required by law to be disclosed in such  Registration  Statement and the Company
may exclude from such Registration  Statement the Registrable  Securities of any
Holder who unreasonably  fails to furnish such  information  within a reasonable
time after receiving such request.  The Company shall not be required to provide
indemnification  to any  underwriter or any other person relating to information
referred  to in  clauses  (i)  and  (ii)  provided  to the  Company  in  writing
specifically for inclusion in such Registration Statement.

               If any such  Registration  Statement refers to any Holder by name
or otherwise as the Holder of any  securities  of the Company,  then such Holder
shall have the right to require (i) the insertion  therein of language,  in form
and substance  reasonably  satisfactory  to such Holder,  to the effect that the
holding  by  such  Holder  of  such  securities  is  not  to be  construed  as a
recommendation  by  such  Holder  of the  investment  quality  of the  Company's
securities covered thereby and that such holding does not imply that such Holder
will assist in meeting any future financial requirements of the Company, or (ii)
in the event that such  reference  to such  Holder by name or  otherwise  is not
required by the Securities  Act, the deletion of the reference to such Holder in
any  amendment or  supplement to the  Registration  Statement  filed or prepared
subsequent to the time that such reference ceases to be required.

               Each Holder of  Registrable  Securities  agrees by acquisition of
such Registrable Securities that, upon receipt of any notice from the Company of
the happening of any event of the kind described in Section 3(c)(ii), 3(c)(iii),
3(c)(iv) or 3(c)(v) hereof, such Holder will forthwith  discontinue  disposition
of such  Registrable  Securities  covered  by  such  Registration  Statement  or
Prospectus  until such  Holder's  receipt of the copies of the  supplemented  or
amended  Prospectus  contemplated by Section 3(j) hereof, or until it is advised
in  writing  (the  "Advice")  by the  Company  that  the  use of the  applicable
Prospectus  may be resumed,  and, in either  case,  has  received  copies of any
additional  or  supplemental  filings  that are  incorporated  or  deemed  to be
incorporated by reference in such Prospectus. If the Company shall give any such
notice, the Effectiveness  Period shall be extended by the number of days during
such  period  from and  including  the date of the giving of such  notice to and
including the date when each Holder of  Registrable  Securities  covered by such
Registration Statement shall have received (x) the copies of the supplemented or
amended Prospectus  contemplated by Section 3(j) hereof or (y) the Advice,  and,
in either case, has received  copies of any additional or  supplemental  filings
that  are  incorporated  or  deemed  to be  incorporated  by  reference  in such
Prospectus.

               4.   Indemnification and Contribution.

               (a) The Company shall indemnify  and hold  harmless  each Holder,
each  underwriter  who  participates  in an offering of Registrable  Securities,
their  respective  Affiliates,  each  Person,  if any,  who controls any of such
parties  within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act and each of their respective directors, officers, employees and
agents, as follows:

               (i) from and against any and all loss,  liability,  claim, damage
          and expense whatsoever,  joint or several, as incurred, arising out of
          any untrue  statement or alleged  untrue  statement of a material fact
          contained in any  Registration  Statement (or any amendment  thereto),
          covering Registrable Securities,  including all documents incorporated
          therein by reference, or the omission or alleged omission therefrom of
          a material fact required to be stated therein or necessary to make the
          statements therein, in the light of the circumstances under which they
          were made,  not  misleading or arising out of any untrue  statement or
          alleged  untrue   statement  of  a  material  fact  contained  in  any
          Prospectus (or any amendment or supplement thereto) or the omission or
          alleged  omission  therefrom of a material fact  necessary in order to
          make the statements  therein,  in the light of the circumstances under
          which they were made, not misleading;

               (ii) from and against any and all loss, liability,  claim, damage
          and expense whatsoever,  joint or several, as incurred,  to the extent
          of the aggregate  amount paid in settlement of any  litigation  (other
          than  amounts  the  Holders  agree  to pay in any  written  settlement
          agreement),  or  any  investigation  or  proceeding  by any  court  or
          governmental agency or body, commenced or threatened,  or of any claim
          whatsoever  based upon any such untrue  statement or omission,  or any
          such  alleged  untrue  statement or omission,  if such  settlement  is
          effected with the prior written consent of the Company; and

               (iii)  from  and  against  any and all  expenses  whatsoever,  as
          incurred  (including  reasonable fees and disbursements of one counsel
          chosen  by  the  Holders  or any  underwriter  (except  to the  extent
          otherwise  expressly  provided in Section  4(c)  hereof)),  reasonably
          incurred  in   investigating,   preparing  or  defending  against  any
          litigation,  or  any  investigation  or  proceeding  by any  court  or
          governmental  agency or body,  commenced or  threatened,  or any claim
          whatsoever  based upon any such untrue  statement or omission,  or any
          such alleged untrue statement or omission, to the extent that any such
          expense is not paid  under  subparagraph  (i) or (ii) of this  Section
          4(a);

provided  that this  indemnity  does not apply to any  loss,  liability,  claim,
damage or expense to the extent  arising out of an untrue  statement or omission
or  alleged  untrue  statement  or  omission  (i) made in  reliance  upon and in
conformity with written information  furnished to the Company by a Holder or any
underwriter in writing  expressly for use in the Registration  Statement (or any
amendment thereto) or any Prospectus (or any amendment or supplement thereto) or
(ii) contained in any preliminary  prospectus if such Holder or such underwriter
failed  to send or  deliver a copy of the  Prospectus  (in the form it was first
provided to such parties for confirmation of sales) to the Person asserting such
losses,  claims,  damages or  liabilities on or prior to the delivery of written
confirmation  of any sale of  securities  covered  thereby to such Person in any
case where such delivery is required by the Securities  Act and such  Prospectus
would have corrected such untrue statement or omission.  Any amounts advanced by
the Company to an  indemnified  party  pursuant to this Section 4 as a result of
such losses  shall be returned to the Company if it shall be finally  determined
by such a court in a judgment  not  subject to appeal or final  review that such
indemnified party was not entitled to indemnification by the Company.

               (b)  By  accepting  the benefits of this  Agreement,  each Holder
agrees,  severally and not jointly,  to indemnify and hold harmless the Company,
each underwriter who  participates in an offering of Registrable  Securities and
the other  selling  Holders  and each of their  respective  directors,  officers
(including each officer of the Company who signed the  Registration  Statement),
employees  and agents and each Person,  if any,  who  controls the Company,  any
underwriter  or any other selling Holder within the meaning of Section 15 of the
Securities  Act or Section 20 of the Exchange  Act, from and against any and all
loss, liability, claim, damage and expense whatsoever described in the indemnity
contained in Section 4(a) hereof,  as incurred,  but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions,  made in the
Registration  Statement (or any  amendment  thereto) or any  Prospectus  (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by such selling Holder expressly for use in
the Registration  Statement (or any amendment  thereto),  or any such Prospectus
(or any amendment or supplement thereto). Notwithstanding the provisions of this
Section 4(b), a Holder of  Registrable  Securities  shall not be required to pay
any  indemnification in an amount in excess of the net proceeds received by such
Holder in the offering to which such Registration Statement relates.

               (c)  Each  indemnified  party  shall  give  prompt notice to each
indemnifying  party of any  action  commenced  against  it in  respect  of which
indemnity  may be sought  hereunder,  enclosing  a copy of all  papers  properly
served on such indemnified party, but failure to so notify an indemnifying party
shall not relieve such  indemnifying  party from any liability which it may have
other than on account of this indemnity  agreement.  An  indemnifying  party may
participate  at its  own  expense  in the  defense  of any  such  action.  If an
indemnifying  party so elects  within a  reasonable  time after  receipt of such
notice, such indemnifying party,  jointly with any other indemnifying party, may
assume the defense of such action with  counsel  chosen  thereby and approved by
the  indemnified  parties  defendant in such action;  provided  that if any such
indemnified party reasonably determines,  based on advice of counsel, that there
may be legal defenses  available to such  indemnified  party which are different
from or in  addition  to  those  available  to such  indemnifying  party or that
representation of such indemnifying  party and any indemnified party by the same
counsel would present a conflict of interest,  then such  indemnifying  party or
parties shall not be entitled to assume such defense.  If an indemnifying  party
is not  entitled to assume the defense of such action as a result of the proviso
to the preceding sentence, counsel for such indemnifying party shall be entitled
to  conduct  the  defense  of such  indemnifying  party  and  counsel  for  each
indemnified  party or parties  shall be  entitled to conduct the defense of such
indemnified party or parties. If an indemnifying party assumes the defense of an
action in accordance  with and as permitted by the provisions of this paragraph,
such indemnifying party shall not be liable for any fees and expenses of counsel
for the indemnified  parties incurred thereafter in connection with such action.
In no event shall the  indemnifying  party or parties be liable for the fees and
expenses of more than one counsel (in addition to any local  counsel),  separate
from its own counsel,  for all  indemnified  parties in connection  with any one
action or  separate  but  similar  or related  actions in the same  jurisdiction
arising out of the same general allegations or circumstances.

               (d) In order to provide for just and  equitable  contribution  in
circumstances  under  which any of the  indemnity  provisions  set forth in this
Section 4 is for any reason held to be  unavailable to the  indemnified  parties
although  applicable in accordance  with its terms,  the Company and the Holders
shall  contribute  to the aggregate  losses,  liabilities,  claims,  damages and
expenses of the nature  contemplated by such indemnity agreement incurred by the
Company  and the  Holders,  as  incurred;  provided  that,  notwithstanding  the
provisions of this Section 4(d), a Holder of Registrable Securities shall not be
required  to  contribute  any  amount in  excess of the  amount by which the net
proceeds  received  by such Holder in the  offering  to which such  Registration
Statement  relates  exceeds  the  amount of any  damages  that such  Holder  has
otherwise   been   required   to  pay  and  no  Person   guilty  of   fraudulent
misrepresentation  (within the meaning of Section 11(f) of the  Securities  Act)
shall be  entitled to  contribution  from any Person that was not guilty of such
fraudulent  misrepresentation.  As between  the Company  and the  Holders,  such
parties shall contribute to such aggregate losses, liabilities,  claims, damages
and  expenses of the nature  contemplated  by such  indemnity  agreement in such
proportion as shall be appropriate to reflect the relative fault of the Company,
on the one hand, and Holders,  on the other hand, with respect to the statements
or omissions which resulted in such loss,  liability,  claim, damage or expense,
or  action  in  respect  thereof,  as  well  as  any  other  relevant  equitable
considerations.  The relative fault of the Company,  on the one hand, and of the
Holders,  on the other hand,  shall be  determined  by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged  omission to state a material  fact  relates to  information
supplied by the Company,  on the one hand, or by or on behalf of the Holders, on
the other, and the parties'  relative intent,  knowledge,  access to information
and  opportunity to correct or prevent such  statement or omission.  The Company
and the Holders of the  Registrable  Securities  agree that it would not be just
and equitable if  contribution  pursuant to this Section 4 were to be determined
by pro rata  allocation or by any other method of allocation  that does not take
into account the relevant equitable considerations. For purposes of this Section
4, each Affiliate of each Holder, and each director,  officer,  employee,  agent
and Person,  if any, who controls a Holder or such Affiliate  within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act shall have
the same  rights  to  contribution  as such  Holder,  and each  director  of the
Company, each officer of the Company who signed the Registration Statement,  and
each Person,  if any, who controls the Company  within the meaning of Section 15
of the  Securities  Act or  Section 20 of the  Exchange  Act shall have the same
rights to contribution as the Company.

               (e) The indemnity and contribution  covenants  contained  in this
Section 4 shall remain operative and in full force and effect  regardless of (i)
any investigation  made by or on behalf of a Holder or any Person  controlling a
Holder,  (ii) any sale of any Registrable  Securities pursuant to this Agreement
and receipt by the Holders of the proceeds  thereof or (iii) any  termination of
this  Agreement  for any  reason,  including  after  the  initial  filing of the
Registration  Statement  to which these  indemnity  and  contribution  covenants
relate

               5. Rule 144A

               The Company shall use its commercially reasonable efforts to file
the reports required to be filed by it under the Securities Act and the Exchange
Act in a timely  manner  and,  if at any time it is not  required  to file  such
reports but in the past had been required to or did file such reports,  it will,
upon the request of any Holder or beneficial  owner of  Registrable  Securities,
make  available  other  information  as required by, and so long as necessary to
permit, sales of Registrable  Securities pursuant to Rule 144A.  Notwithstanding
the foregoing,  nothing in this Section 5 shall be deemed to require the Company
to register any of its securities pursuant to the Exchange Act.

               6.  Underwritten Registrations

               No  Person  may  participate  in  any  underwritten  registration
hereunder unless such Person (i) agrees to sell such  Registrable  Securities on
the basis reasonably provided in any underwriting  arrangements  approved by the
Persons entitled  hereunder to approve such  arrangements and (ii) completes and
executes  all  questionnaires,  powers of  attorney,  indemnities,  underwriting
agreements and other  documents  required  under the terms of such  underwriting
arrangements.

               7.  Miscellaneous

               (a)  Remedies.  In the event of a breach by the Company or  by  a
Holder of any of its  obligations  under  this  Agreement,  each  Holder and the
Company,  in addition to being  entitled to exercise all rights  granted by law,
including recovery of damages,  will be entitled to specific  performance of its
rights under this  Agreement.  The Company and each Holder  agrees that monetary
damages would not be adequate  compensation for any loss incurred by reason of a
breach of any of the provisions of this Agreement and each hereby further agrees
that,  in the event of any action for  specific  performance  in respect of such
breach, it shall waive the defense that a remedy at law would be adequate.

               (b) No Inconsistent  Agreements.  The Company will not enter into
any agreement  that is  inconsistent  with the rights granted to the Holders and
indemnified persons in this Agreement or otherwise conflicts with the provisions
hereof.  Without  the  written  consent  of the  Holders  of a  majority  of the
outstanding  Shares,  the Company shall not grant to any Person any rights which
conflict with or are inconsistent with the provisions of this Agreement.

               (c) Amendments  and Waivers.  The  provisions of this  Agreement,
including  the  provisions  of this  sentence,  may not be amended,  modified or
supplemented,  and waivers or consents to departures from the provisions  hereof
may not be given,  otherwise than with the prior written  consent of the Holders
of not less than a majority of the then outstanding Shares.  Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect
to a matter that relates  exclusively to the rights of Holders whose  securities
are being sold pursuant to a  Registration  Statement and that does not directly
or  indirectly  affect the rights of other  Holders may be given by Holders of a
majority of the Registrable  Securities  being sold by such Holders  pursuant to
such  Registration  Statement;  provided,  however,  that the provisions of this
sentence may not be amended,  modified or supplemented except in accordance with
the  provisions  of the  immediately  preceding  sentence.  Notwithstanding  the
foregoing,  no  amendment,  modification,  supplement,  waiver or  consent  with
respect  to  Section  4 shall be made or given  otherwise  than  with the  prior
written consent of each Holder or former Holder affected thereby.

               (d) Notices. All notices and other  communications  provided  for
herein  shall  be  made in  writing  by  hand-delivery,  next-day  air  courier,
certified first-class mail, return receipt requested, telex or telecopier:

               (i) if to the Company, as provided in the Purchase Agreement,

               (ii) if to the Purchasers, as provided in the Purchase Agreement,
          or

               (iii) if to any other Person who is then the registered Holder of
          Shares or Registrable Securities,  to the address of such Holder as it
          appears in the register therefor of the Company.

               Except  as  otherwise  provided  in  this  Agreement,   all  such
communications  shall be deemed to have been duly given: when delivered by hand,
if  personally  delivered;  one Business  Day after being timely  delivered to a
next-day  air courier;  five  Business  Days after being  deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed;  and when receipt is
acknowledged by the recipient's telecopier machine, if telecopied.

               (e) Successors and Assigns.  This  Agreement  shall  inure to the
benefit of and be binding upon the successors  and permitted  assigns of each of
the parties and shall inure to the benefit of each Holder of Shares. The Company
may not assign any of its rights hereunder  without the prior written consent of
each Holder of Shares;  provided that a merger or  consolidation  of the Company
with another  Person  pursuant to which the issuer or issuers of any  securities
issued to  Holders of Shares in  connection  with such  merger or  consolidation
becomes  obligated  under this Agreement  shall not be considered an assignment.
Notwithstanding  the  foregoing,  no successor or assignee of the Company  shall
have any of the rights  granted  under this  Agreement  until such Person  shall
acknowledge its rights and obligations  hereunder by a signed written  statement
of such person's acceptance of such rights and obligations. If any transferee of
any Holder shall  acquire  Shares in any manner,  whether by operation of law or
otherwise,  such  Shares  shall  be held  subject  to all of the  terms  of this
Agreement,  and  by  taking  and  holding  such  Shares  such  person  shall  be
conclusively  deemed  to have  agreed to be bound by and to  perform  all of the
terms and  provisions  of this  Agreement  and such person  shall be entitled to
receive the benefits hereof.

               (f)  Counterparts.  This Agreement may be executed in any  number
of  counterparts  and by the parties  hereto in separate  counterparts,  each of
which when so executed shall be deemed to be an original and, all of which taken
together shall constitute one and the same Agreement.

               (g) Governing  Law;  Submission  to Jurisdiction.  THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN  ACCORDANCE  WITH THE LAWS OF THE STATE OF
NEW YORK,  AS APPLIED TO CONTRACTS  MADE AND  PERFORMED  WITHIN THE STATE OF NEW
YORK.  THE  COMPANY  AND  THE  PURCHASERS  HEREBY   IRREVOCABLY  SUBMIT  TO  THE
JURISDICTION  OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN
THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN
THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT,  AND EACH  IRREVOCABLY  ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY,  GENERALLY  AND  UNCONDITIONALLY,  JURISDICTION  OF THE
AFORESAID COURTS.

               (h) Severability.  The  remedies  provided  herein are cumulative
and not  exclusive  of any  remedies  provided by law.  If any term,  provision,
covenant  or  restriction  of this  Agreement  is held by a court  of  competent
jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the
terms,  provisions,  covenants and restrictions set forth herein shall remain in
full force and effect and shall in no way be affected,  impaired or invalidated,
and the parties hereto shall use their reasonable  efforts to find and employ an
alternative  means to achieve the same or substantially  the same result as that
contemplated  by such term,  provision,  covenant or  restriction.  It is hereby
stipulated  and declared to be the intention of the parties that they would have
executed the remaining terms,  provisions,  covenants and  restrictions  without
including any of such that may be hereafter declared invalid,  illegal,  void or
unenforceable.

               (i) Headings.  The headings in this Agreement are for convenience
of reference  only and shall not limit or otherwise  affect the meaning  hereof.
All references made in this Agreement to "Section" and "paragraph" refer to such
Section or paragraph of this Agreement, unless expressly stated otherwise.

               (j) Legends.  Each Holder agrees that the following  legend shall
be placed on certificates representing any Securities owned by them:

        THE SECURITIES  REPRESENTED BY THIS  CERTIFICATE  MAY NOT BE TRANSFERRED
        UNLESS SUCH  TRANSFER  COMPLIES WITH THE  PROVISIONS  OF A  REGISTRATION
        RIGHTS  AGREEMENT  DATED AS OF DECEMBER  10, 1999, A COPY OF WHICH IS ON
        FILE WITH THE SECRETARY OF  OUTSOURCING  SOLUTIONS INC. AND IS AVAILABLE
        WITHOUT  CHARGE  UPON  WRITTEN  REQUEST  THEREFOR.  THE  HOLDER  OF THIS
        CERTIFICATE,  BY ACCEPTANCE OF THIS  CERTIFICATE,  AGREES TO BE BOUND BY
        ALL OF THE PROVISIONS OF THE AFORESAID AGREEMENT.

The  Company  agrees to remove the legend on the Shares  upon the resale of such
Shares in accordance with the terms of this Agreement.

               (k)  Notwithstanding anything to the contrary, nothing  contained
in this  Agreement  shall  affect,  limit or impair the rights and  remedies  of
Heller  Financial,  Inc.  in its  capacity as (i) a lender to the Company or any
Subsidiary  pursuant to any agreement  under which the Company or any Subsidiary
has  borrowed  or may  borrow  money,  and (ii) the  beneficiary  of any and all
agreements  entered  into by the  Company or any  Subsidiary  for the benefit of
Heller Financial, Inc., as lender.

<PAGE>


               IN WITNESS  WHEREOF,  the parties  have caused this  Registration
Rights Agreement to be duly executed as of the date first written above.

                                            OUTSOURCING SOLUTIONS INC.

                                            By:/s/ Gary L. Weller
                                               ---------------------------------
                                                 Name: Gary L. Weller
                                                 Title: EVP


                                            ARES LEVERAGED INVESTMENT FUND, L.P.

                                            By:  Ares Management, L.P.,
                                                   its General Partner

                                            By: /s/ Jeffrey Serota
                                                --------------------------------
                                                 Name: Jeffrey Serota
                                                 Title: Vice President

                                            ARES LEVERAGED INVESTMENT FUND II,
                                                 L.P.

                                            By:  Ares Management II, L.P.,
                                              its General Partner

                                            By: /s/ Jeffrey Serota
                                                --------------------------------
                                                 Name: Jeffrey Serota
                                                 Title: Vice President

                                            DB CAPITAL INVESTORS, L.P.

                                            By: DB Capital Partners, L.P.

                                            By DB Capital Partners, Inc.

                                            By: /s/ Tyler Zachem
                                                --------------------------------
                                                 Name: Tyler Zachem
                                                 Title: Managing Director


<PAGE>

                                            FIRST UNION INVESTORS, INC.

                                            By: /s/
                                                --------------------------------
                                                 Name:
                                                 Title:

                                            ABBOTT CAPITAL 1330 INVESTORS II,
                                                L.P.

                                            By:  Abbott Capital 1330 GenPar II,
                                                   L.L.C.,
                                                   its General Partner

                                            By: /s/ Thomas W. Hallagan
                                                --------------------------------
                                                 Name: Thomas W. Hallagan
                                                 Title: Manager


                                            ABBOTT CAPITAL PRIVATE EQUITY FUND
                                                III, L.P.

                                            By:  Abbott Capital Management,
                                                    L.L.C.,
                                                   its General Partner

                                            By: /s/ Raymond L. Held
                                                --------------------------------
                                                 Name: Raymond L. Held
                                                 Title: Managing Director

                                            BNY PARTNERS FUND, L.L.C.

                                            By:  BNY Private Investment
                                                     Management, Inc.,
                                                     its Member Manager

                                            By: /s/ Burton M. Siegal
                                                --------------------------------
                                                 Name: Burton M. Siegal
                                                 Title:Senior VP

<PAGE>

                                            HELLER FINANCIAL, INC.

                                            By: /s/ Timothy P. Davitt
                                                --------------------------------
                                                 Name: Timothy P. Davitt
                                                 Title: Vice President

                                            MAGNETITE ASSET INVESTORS L.L.C.

                                            By:  Blackrock Financial Management,
                                                   Inc.
                                                   As Managing Member

                                            By: /s/ Dennis M. Schaney
                                                --------------------------------
                                                 Name: Dennis M. Schaney
                                                 Title: Managing Director