<PAGE>

Exhibit 10.4

                                INCENTIVE WARRANT

              THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE
UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED, HYPOTHECATED OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A
TRANSACTION WHICH IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. THE
HOLDER OF THIS CERTIFICATE IS THE BENEFICIARY OF CERTAIN OBLIGATIONS OF DAUPHIN
TECHNOLOGY, INC. SET FORTH IN A SECURITIES PURCHASE AGREEMENT, DATED AS OF
SEPTEMBER 28, 2001, AS AMENDED BY AMENDMENT TO SECURITIES PURCHASE AGREEMENT,
DATED AS OF SEPTEMBER 28, 2001, BETWEEN DAUPHIN TECHNOLOGY, INC. AND CRESCENT
INTERNATIONAL LTD. A COPY OF THE PORTION OF THE AFORESAID AGREEMENT EVIDENCING
SUCH OBLIGATIONS MAY BE OBTAINED FROM DAUPHIN TECHNOLOGY, INC.'S EXECUTIVE
OFFICES.

                                                              September 28, 2001

Warrant to Purchase 700,000 shares of Common Stock of Dauphin Technology, Inc.
(hereinafter, the "Incentive Warrant").
                   -----------------

Dauphin Technology, Inc., an entity organized and existing under the laws of the
State of Illinois (the "Company"), hereby agrees that Crescent International
                        -------
Ltd. (the "Investor") or any other Warrant Holder is entitled, on the terms and
           --------
conditions set forth below, to purchase from the Company at any time during the
Exercise Period (as defined below) 700,000 fully paid and nonassessable shares
of Common Stock, par value $0.001 per share, of the Company (the "Common
                                                                  ------
Stock"), as the same may be adjusted from time to time pursuant to Section 6
-----
hereof, at the Exercise Price (as defined below), as the same may be adjusted
pursuant to Section 6 hereof. The resale of the shares of Common Stock or other
securities issuable upon exercise or exchange of this Incentive Warrant is
subject to the provisions of the Registration Rights Agreement (as defined
below).

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

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

              "Agreement" shall mean the Securities Purchase Agreement, dated as
               ---------
of September 28, 2001, between the Company and the Investor, as amended by
Amendment to Securities Purchase Agreement, dated as of September 28, 2001.

<PAGE>

              "Exercise Date" shall mean, with respect to any exercise (in whole
               -------------
or in part) of this Incentive Warrant the date the Exercise Notice is sent by
facsimile to the Company.

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

              "Exercise Period" shall mean the period beginning on the date
               ---------------
hereof and continuing until the expiration of the five-year period thereafter;
provided that such period shall be extended one day for each day after the date
hereof, that the Registration Statement covering (i) Commitment Shares purchased
by the Investor, (ii) the Protective Warrant Shares, if any, related to any
Subsequent Sales and (iii) the Incentive Warrant Shares purchasable through
exercise of this Incentive Warrant, is not effective during the period such
Registration Statement is required to be effective pursuant to the Registration
Rights Agreement.

              "Exercise Price" as of the date hereof shall mean $1.3064 per
               --------------
share of Common Stock, subject to the adjustments provided for in Section 6 of
this Incentive Warrant.

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

              "Registration Rights Agreement" shall mean the registration rights
               -----------------------------
agreement, dated as of September 28, 2001, between the Company and the Investor.

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

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

Section 2.    Exercise; Cashless Exercise.
              ---------------------------

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

(b)  Payment of Aggregate Exercise Price. Subject to paragraph (c) below,
     -----------------------------------
     payment of the Aggregate Exercise Price shall be made by wire transfer of
     immediately available funds to an account designated by the Company. If the
     amount of the payment received by the Company is less than the Aggregate
     Exercise Price, the Warrant Holder will be notified of the deficiency and
     shall make payment in that amount within 5 Trading Days of such notice. In
     the event the payment exceeds the Aggregate Exercise Price, the Company
     will refund the excess to the Warrant Holder within 3 Trading Days of both
     the receipt of such payment and the knowledge of such excess.

<PAGE>

           Cashless Exercise. As an alternative to payment of the Aggregate
           -----------------
              Exercise Price in accordance with Section 2(b) above, the arrant
              Holder may elect to effect a cashless exercise, if permissible
              under this Section 2(c), by so indicating on the Exercise Notice
              and including a calculation of the number of shares of Common
              Stock to be issued upon such exercise in accordance with the terms
              hereof (a "Cashless Exercise"). The Warrant Holder may elect to
                         -----------------
              effect a Cashless Exercise upon the occurrence or continuation of
              any of the events described in Section 2.1(g) (ii), (iii), and
              (iv) of the Registration Rights Agreement (whether the Company has
              or has not notified the Warrant Holder of any such event) in
              respect of one or more Registration Statements (as defined in the
              Registration Rights Agreement) covering the shares of Common Stock
              issuable upon exercise of this Incentive Warrant, or upon the
              delisting of the Common Stock from the Principal Market.
              Additionally, the Warrant Holder may elect to effect a Cashless
              Exercise upon the occurrence, and continuation for a period
              exceeding 22 Trading Days from such occurrence, of any event
              described in Section 2.1(g)(vi) of the Registration Rights
              Agreement (whether the Company has or has not notified the Warrant
              Holder of any such event) in respect of one or more Registration
              Statements (as defined in the Registration Rights Agreement)
              covering the shares of Common Stock issuable upon exercise of this
              Incentive Warrant. In the event of a Cashless Exercise, the
              Warrant Holder shall surrender this Incentive Warrant for that
              number of shares of Common Stock determined by (i) multiplying the
              number of Incentive Warrant Shares for which this Incentive
              Warrant is being exercised by the Per Share Warrant Value and (ii)
              dividing the product by the Bid Price of one share of the Common
              Stock on the Trading Day immediately preceding the Exercise Date.

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

Section 3.    Ten Percent Limitation. At no time may the Warrant Holder exercise
              ----------------------
     this Incentive Warrant such that the number of Incentive Warrant Shares to
     be received pursuant to such exercise aggregated with all other shares of
     Common Stock then owned by the Warrant Holder beneficially or deemed
     beneficially owned (as such term is defined in Rule 13(d) under the
     Exchange Act) by the Warrant Holder and its affiliates would result in the
     Warrant Holder and its affiliates owning more than 9.9% of all of such
     Common Stock as would be outstanding on such Exercise Date, as determined
     in accordance with Section 13(d) of the Exchange Act and the rules and
     regulations promulgated thereunder.

Section 4.    Delivery of Stock Certificates.
              ------------------------------

(a) Subject to the terms and conditions of this Incentive Warrant, as soon as
    practicable after the exercise of this Incentive Warrant in full or in part,
    and in any event within five (5) Trading

<PAGE>

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

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

Section 5.   Representations, Warranties and Covenants of the Company.
             --------------------------------------------------------

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

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

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

(d)  The Company has authorized and reserved for issuance to the Warrant Holder
     the requisite number of shares of Common Stock to be issued pursuant to
     this Incentive Warrant. The Company at all times shall reserve and keep
     available, solely for issuance and delivery as Incentive Warrant Shares
     hereunder, such shares of Common Stock as from time to time shall be
     issuable as Incentive Warrant Shares, and accordingly shall adjust the
     number of such shares of Common Stock promptly upon the occurrence of any
     of the events specified in Section 6 hereof.

Section 6.   Adjustment of the Exercise Price. The Exercise Price and,
             --------------------------------
     accordingly, the number of Incentive Warrant Shares issuable upon exercise
     of the Incentive Warrant, shall be subject to adjustment from time to time
     upon the happening of certain events as follows:

(a)  Reclassification, Consolidation, Merger; Mandatory Share Exchange; Sale
     -----------------------------------------------------------------------
     Transfer or Lease of Assets. If the Company, at any time while this
     ---------------------------
     Incentive Warrant is unexpired and not exercised in full, (i) reclassifies
     or changes its Outstanding Capital Shares (other than a change in par
     value, or from par value to no par value per share, or from no par value
     per share to par value or as a result of a subdivision or combination of
     outstanding securities issuable upon exercise of this Incentive Warrant)
     or (ii) consolidates, merges or effects a

<PAGE>

     mandatory share exchange (x) with or into another corporation (other than a
     merger or mandatory share exchange with another corporation in which the
     Company is a continuing corporation and that does not result in any
     reclassification or change, other than a change in par value, or from par
     value to no par value per share, or from no par value per share to par
     value, or (y) as a result of a subdivision or combination of Outstanding
     Capital Shares issuable upon exercise of the Incentive Warrant) or (iii)
     sells, transfers or leases all or substantially all of its assets, then in
     any such event the Company, or such successor or purchasing corporation, as
     the case may be, shall, without payment by the Warrant Holder of any
     additional consideration therefor, amend this Incentive Warrant or issue a
     new warrant providing that the Warrant Holder shall have rights not less
     favorable to the Warrant Holder than those then applicable to this
     Incentive Warrant and to receive upon exercise under such amendment of this
     Incentive Warrant or new warrant, in lieu of each share of Common Stock
     theretofore issuable upon exercise of this Incentive Warrant hereunder, the
     kind and amount of shares of stock, other securities, money or property
     receivable upon such reclassification, change, consolidation, merger,
     mandatory share exchange, lease, sale or transfer by the holder of one
     share of Common Stock issuable upon exercise of the Incentive Warrant had
     this Incentive Warrant been exercised immediately prior to such
     reclassification, change, consolidation, merger, mandatory share exchange
     or sale or transfer (without giving effect to the limitation on ownership
     set forth in Section 3 hereof), and an appropriate provision for the
     foregoing shall be made by the Company as part of any such event. Such
     amended Incentive Warrant or new warrant shall provide for adjustments that
     shall be as nearly equivalent as may be practicable to the adjustments
     provided for in this Section 6. The provisions of this Section 6(a) shall
     similarly apply to successive reclassifications, changes, consolidations,
     mergers, mandatory share exchanges, sales, transfers and leases.

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

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

(ii) the denominator of which shall be the total number of Outstanding Capital
     Shares immediately after such subdivision, combination, dividend or other
     distribution. The provisions of this Section 6(b) shall not apply under any
     of the circumstances for which an adjustment is made pursuant to Section
     6(a).

(c)  Liquidating Dividends, Etc. If the Company, at any time while this
     ---------------------------
     Incentive Warrant is unexpired and not exercised in full, makes a
     distribution of its assets or evidences of indebtedness to the holders of
     its Capital Shares as a dividend in liquidation or by way of return of
     capital or other than as a dividend payable out of earnings or surplus
     legally

<PAGE>

     available for dividends under applicable law or any distribution to such
     holders made in respect of the sale of all or substantially all of the
     Company's assets, or any spin-off of any of the Company's lines of
     business, divisions or subsidiaries (other than under the circumstances
     provided for in the foregoing subsections (a) and (b)), then the Warrant
     Holder shall be entitled to receive upon such exercise of the Incentive
     Warrant in addition to the Incentive Warrant Shares receivable in
     connection therewith, and without payment of any consideration other than
     the Exercise Price, an amount in cash equal to the value of such
     distribution per Capital Share multiplied by the number of Incentive
     Warrant Shares that, on the record date for such distribution, are issuable
     upon such exercise of the Incentive Warrant (without giving effect to the
     limitation on ownership set forth in Section 3 hereof), and an appropriate
     provision therefor shall be made by the Company as part of any such
     distribution. The value of a distribution that is paid in other than cash
     shall be determined in good faith by the Board of Directors of the Company.

(d)  Adjustment of Number of Shares. Upon each adjustment of the Exercise Price
     ------------------------------
     pursuant to any provisions of this Section 6, the number of Incentive
     Warrant Shares issuable hereunder at the option of the Warrant Holder shall
     be calculated, to the nearest one hundredth of a whole share, multiplying
     the number of Incentive Warrant Shares issuable prior to an adjustment by a
     fraction:

(i)  the numerator of which shall be the Exercise Price before any adjustment
     pursuant to this Section 6; and

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

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

(f)  Notice of Certain Actions. In the event the Company shall, at a time while
     -------------------------
     the Incentive Warrant is unexpired and outstanding, take any action
     pursuant to subsections (a) through (e) of this Section 6 that may result
     in an adjustment of the Exercise Price, the Company shall notify the
     Warrant Holder of such action 10 days in advance of its effective date in
     order to afford to the Warrant Holder an opportunity to exercise the
     Incentive Warrant prior to such action becoming effective.

(g)  Notice of Adjustments. Whenever the Exercise Price or number of Incentive
     ---------------------
     Warrant Shares shall be adjusted pursuant to Section 6 hereof, the Company
     shall promptly deliver by facsimile, with the original delivered by express
     courier service in accordance with Section 11 hereof, a certificate, which
     shall be signed by the Company's President or a Vice

<PAGE>

     President and by its Treasurer or Assistant Treasurer or its Secretary or
     Assistant Secretary, setting forth in reasonable detail the event requiring
     the adjustment, the amount of the adjustment, the method by which such
     adjustment was calculated (including a description of the basis on which
     the Company's Board of Directors made any determination hereunder), and the
     Exercise Price and number of Incentive Warrant Shares purchasable at that
     Exercise Price after giving effect to such adjustment.

Section 7.  No Impairment. The Company will not, by amendment of its Certificate
            -------------
     or By-Laws or through any reorganization, transfer of assets,
     consolidation, merger, dissolution, issue or sale of securities or any
     other voluntary action, avoid or seek to avoid the observance or
     performance of any of the terms of this Incentive Warrant, but will at all
     times in good faith assist in the carrying out of all such terms and in the
     taking of all such action as may be necessary or appropriate in order to
     protect the rights of the Warrant Holder against impairment. Without
     limiting the generality of the foregoing, the Company (a) will not increase
     the par value of any Incentive Warrant Shares above the amount payable
     therefor on such exercise, and (b) will take all such action as may be
     reasonably necessary or appropriate in order that the Company may validly
     and legally issue fully paid and nonassessable Incentive Warrant Shares on
     the exercise of this Incentive Warrant.

Section 8.  Rights As Stockholder. Prior to exercise of this Incentive Warrant
            ---------------------
     and except as provided in Section 6 hereof, the Warrant Holder shall not be
     entitled to any rights as a stockholder of the Company with respect to the
     Incentive Warrant Shares, including (without limitation) the right to vote
     such shares, receive dividends or other distributions thereon or be
     notified of stockholder meetings. However, in the event of any taking by
     the Company of a record of the holders of any class of securities for the
     purpose of determining the holders thereof who are entitled to receive any
     dividend (other than a cash dividend) or other distribution, any right to
     subscribe for, purchase or otherwise acquire any shares of stock of any
     class or any other securities or property, or to receive any other right,
     the Company shall mail to each Warrant Holder, at least 10 days prior to
     the date specified therein, a notice specifying the date on which any such
     record is to be taken for the purpose of such dividend, distribution or
     right, and the amount and character of such dividend, distribution or
     right.

Section 9.  Replacement of Incentive Warrant. Upon receipt of evidence
            --------------------------------
     reasonably satisfactory to the Company of the loss, theft, destruction or
     mutilation of the Incentive Warrant and, in the case of any such loss,
     theft or destruction of the Incentive Warrant, upon delivery of an
     indemnity agreement or security reasonably satisfactory in form and amount
     to the Company or, in the case of any such mutilation, on surrender and
     cancellation of such Incentive Warrant, the Company at its expense will
     execute and deliver, in lieu thereof, a new Incentive Warrant of like
     tenor.

Section 10. Restricted Securities.
            ---------------------

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

<PAGE>

     registration statement or an exemption to the registration requirements of
     the Securities Act and applicable state laws.

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

                  "THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
                  REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED
                  (THE "SECURITIES ACT"), OR ANY OTHER APPLICABLE SECURITIES
                  LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM
                  THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH
                  OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST
                  OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
                  TRANSFERRED, PLEDGED, ENCUMBERED, HYPOTHECATED OR OTHERWISE
                  DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
                  STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A
                  TRANSACTION WHICH IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH
                  REGISTRATION. THE HOLDER OF THIS CERTIFICATE IS THE
                  BENEFICIARY OF CERTAIN OBLIGATIONS OF DAUPHIN TECHNOLOGY, INC.
                  SET FORTH IN A SECURITIES PURCHASE AGREEMENT, DATED AS OF
                  SEPTEMBER 28, 2001, AS AMENDED BY AMENDMENT TO SECURITIES
                  PURCHASE AGREEMENT, DATED AS OF SEPTEMBER 28, 2001, BETWEEN
                  DAUPHIN TECHNOLOGY, INC. AND CRESCENT INTERNATIONAL LTD. A
                  COPY OF THE PORTION OF THE AFORESAID AGREEMENT EVIDENCING SUCH
                  OBLIGATIONS MAY BE OBTAINED FROM DAUPHIN TECHNOLOGY, INC.'S
                  EXECUTIVE OFFICES."

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

(c)  No Other Legend or Stock Transfer Restrictions. No legend other than the
     ----------------------------------------------
     one specified in paragraph (b) of this Section 10 has been or shall be
     placed on the share certificates representing the Incentive Warrant Shares
     and no instructions or "stop transfer orders," so called, "stock transfer
                             --------------------               --------------
     restrictions" or other restrictions have been or shall be given to the
     ------------
     Company's transfer agent with respect thereto other than as expressly set
     forth in this Section 10.

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

<PAGE>

     Warrant Holder a Incentive Warrant or Incentive Warrants of like tenor and
     terms for the specified number of shares.

(e)  Investor's Compliance. Nothing in this Section 10 shall affect in any way
     ---------------------
     the Investor's  obligations under any agreement to comply with all
     applicable securities laws upon resale of the Common Stock.

Section 11. Notices. All notices, demands, requests, consents, approvals, and
            -------
     other communications required or permitted hereunder shall be in writing
     and shall be deemed duly given (i) upon delivery if hand delivered at the
     address designated below (if delivered on a business day during normal
     business hours where such notice is to be received), or the first business
     day following such delivery (if delivered other than on a business day
     during normal business hours where such notice is to be received), (ii) on
     the fifth business day after deposit into the mail, if deposited in the
     mail, registered or certified, return receipt requested, postage prepaid,
     addressed to the address designated below, (iii) upon delivery if delivered
     by reputable express courier service to the address designated below, or
     (iv) upon confirmation of transmission if transmitted by facsimile to the
     facsimile number designated below (if delivered on a business day during
     normal business hours where such notice is to be received), or the first
     business day following such delivery (if delivered other than on a business
     day during normal business hours where such notice is to be received). The
     addresses and facsimile numbers for such communications shall be:

         if to the Company:

                       Dauphin Technology, Inc.
                       800 E. Northwest Highway
                       Suite 950
                       Palatine, IL 60067
                       Attention: Christopher L. Geier
                       Telephone: (847) 358-4406
                       Facsimile: (847) 358-4407

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

                       Rieck & Crotty, P.C.
                       55 West Monroe Street, Suite 3390
                       Chicago, IL 60603-5062
                       Attention: Ronald P. Duplack, Esq.
                       Telephone: (312) 726-4646
                       Facsimile: (312) 726-0647





<PAGE>

         if to the Investor:

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

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

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

            Either party hereto may from time to time change its address or
facsimile number for notices under this Section 11 by giving at least ten (10)
days' prior written notice of such changed address or facsimile number to the
other party hereto.

Section 12. Miscellaneous. This Incentive Warrant and any term hereof may be
            -------------
    changed, waived, discharged or terminated only by an instrument in writing
    signed by the party against which enforcement of such change, waiver,
    discharge or termination is sought. The headings in this Incentive Warrant
    are for purposes of reference only, and shall not limit or otherwise affect
    any of the terms hereof. The invalidity or unenforceability of any
    provision hereof shall in no way affect the validity or enforceability of
    any other provision.

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

DAUPHIN TECHNOLOGY, INC.


By: ______________________________________
    Name:  Christopher L. Geier
    Title: Executive Vice President


Attested:


By: ______________________________________
    Name:
    Title: Secretary