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                                                                     EXHIBIT 4.3

                                WARRANT AGREEMENT

     This WARRANT AGREEMENT, dated as of __________ __, 200__ (this
"Agreement"), is made and entered into by and between Alderwoods Group, Inc., a
Delaware corporation (the "Company"), and Wells Fargo Bank Minnesota, N.A., a
national banking association (the "Warrant Agent").

                                    RECITALS

     A. A plan of reorganization of the Company, its parent corporation and
certain of their debtor subsidiaries (the "Plan") proposed by the Company was
confirmed by the United States Bankruptcy Court for the District of Delaware on
__________, 200__.

     B. The Plan provides for the execution and delivery of this Agreement by
the Company.

     C. The Company desires to issue the Warrants (as defined below) on the
terms and subject to the conditions herein set forth.

     NOW, THEREFORE, in consideration of the mutual covenants herein set forth,
the parties hereto hereby agree as follows:

     1. Issuance of Warrants; Form of Warrants.

     1.1 Issuance of Warrants. On the terms and subject to the conditions set
forth in the Plan, (a) the Company will issue and deliver to (i) holders of
Allowed Claims in Class 8, (ii) holders of Allowed Claims in Divisions A, B, F,
G and H of Class 11, and (iii) if Class 19 accepts the Plan, Loewen Group
Capital, L.P. ("LGCLP"), the holder of Allowed Claims in Class 9 (as such terms
are defined in the Plan), an aggregate of up to 2,992,000 (subject to increase
as a result of the application of the rounding provisions set forth in Section
VI.H.3.a of the Plan) warrants (the "Warrants"), each Warrant initially
representing the right to purchase one share of Common Stock (as defined below),
and (b) immediately after the issuance of Warrants, if any, to LGCLP as
contemplated by clause (a), the Company and the Warrant Agent will effect the
transfer and delivery of such Warrants from LGCLP to the holders of Allowed
Interests and Claims in Class 19 (as such terms are defined in the Plan). The
purchase price per Warrant Share (as defined below) payable upon the exercise of
a Warrant (the "Warrant Price") will initially be $25.76. The shares of Common
Stock purchasable upon exercise of the Warrants are hereinafter referred to as
the "Warrant Shares." The Warrant Price and the number and kind of Warrant
Shares purchasable upon exercise of the Warrants are subject to adjustment
pursuant to the provisions of Section 4.

     1.2 Form of Warrants. Each Warrant, including without limitation any
Warrants that may be issued upon partial exercise, replacement or transfer of
Warrants, will be evidenced by, and subject to the terms of, a Warrant
certificate (including the Form of Exercise Notice and Form of Assignment to be
printed on the reverse thereof, a "Warrant Certificate") in substantially the
form of Exhibit A, with such changes, such marks of identification or
designation and such legends, summaries or endorsements printed thereon as the
Company may deem appropriate and

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as are not inconsistent with the provisions of this Agreement, or as may be
required to comply with any applicable law or with any rule or regulation made
pursuant thereto.

     1.3 Countersignature of Warrants. The Warrant Certificates will be executed
on behalf of the Company by the manual or facsimile signature of its Chairman,
Chief Executive Officer, President or any Vice President, and attested by its
Secretary or any Assistant Secretary. The Warrant Certificates will be
countersigned by the Warrant Agent manually and will not be valid for any
purpose unless so countersigned. In case any officer of the Company who has
signed any of the Warrant Certificates ceases to be such officer of the Company
before countersignature by the Warrant Agent and issuance and delivery by the
Company, such Warrant Certificates, nevertheless, may be countersigned by the
Warrant Agent, and issued and delivered by the Company with the same force and
effect as though the person who signed such Warrant Certificates had not ceased
to be such officer of the Company; and any Warrant Certificate may be signed on
behalf of the Company by any person who, at the actual date of the execution of
such Warrant Certificate, is a proper officer of the Company to sign such
Warrant Certificate, although on any other date such person was not such an
officer.

     1.4 Registration of Warrants. The Warrant Agent will keep or cause to be
kept, at the principal office of the Warrant Agent designated for such purpose,
books for registration and transfer of the Warrant Certificates issued
hereunder. Such books will show the names and addresses of the respective
holders of the Warrant Certificates, the number of Warrants evidenced on its
face by each of the Warrant Certificates and the date of each of the Warrant
Certificates. The Company and the Warrant Agent will be entitled to treat the
registered holder of any Warrant Certificate (the "Holder") as the sole owner of
the Warrants represented by such Warrant Certificate for all purposes and will
not be bound to recognize any equitable or other claim or interest in such
Warrants on the part of any other person. Neither the Company nor the Warrant
Agent will be liable for any registration of transfer of any Warrants that are
registered or to be registered in the name of a fiduciary or the nominee of a
fiduciary.

     2. Transfer and Exchange of Warrants.

     2.1 Transfer and Exchange. Any Warrant Certificate may be transferred,
split up, combined or exchanged for another Warrant Certificate or Warrant
Certificates entitling the Holder thereof to purchase a like aggregate number of
Warrant Shares as the Warrant Certificate or Warrant Certificates surrendered
then entitled such Holder (or former Holder in the case of a transfer) to
purchase. Any Holder desiring to transfer, split up, combine or exchange any
such Warrant Certificate will make such request in writing delivered to the
Warrant Agent, and will surrender the Warrant Certificate or Warrant
Certificates to be transferred, split up, combined or exchanged, with the Form
of Assignment duly executed by the Holder thereof, at the principal office of
the Warrant Agent designated for such purpose. Thereupon or as promptly as
practicable thereafter, the Company will prepare, execute and deliver to the
Warrant Agent, and the Warrant Agent will countersign and deliver, a Warrant
Certificate or Warrant Certificates, as the case may be, as so requested.
Neither the Company nor the Warrant Agent will be required to issue or deliver
any Warrant Certificates in connection with any transfer, split up, combination
or exchange of Warrants or Warrant Certificates unless and until the person or
persons requesting the issuance or delivery thereof has paid to the Warrant
Agent the amount of any tax or governmental charge that may be payable in
connection with such transfer, split up,

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combination or exchange or has established to the satisfaction of the Warrant
Agent that any tax or governmental charge has been paid. Holders will not be
required to pay any other charge in connection with the transfer, split up,
combination or exchange of Warrants.

     2.2 Lost, Stolen, and Mutilated Warrant Certificates. Upon (a) receipt by
the Company and the Warrant Agent of (i) evidence satisfactory to the Company
and the Warrant Agent of the loss, theft, mutilation or destruction of a Warrant
Certificate and (ii) security or indemnity as may be required by the Company or
the Warrant Agent of all reasonable expenses incidental thereto, and (b)
surrender to the Warrant Agent and cancellation of the Warrant Certificate if
mutilated, the Company will prepare, execute and deliver a new Warrant
Certificate of like tenor to the Warrant Agent and the Warrant Agent will
countersign and deliver such new Warrant Certificate to the Holder in lieu of
the Warrant Certificate so lost, stolen, mutilated or destroyed.

     2.3 Payment of Taxes. The Company will pay all documentary or stamp taxes,
if any, attributable to the initial issuance and transfer of the Warrants
pursuant to the first sentence of Section 1.1 and the initial issuance of the
Warrant Shares upon the exercise of Warrants; provided, however, that the
Company's obligations in this regard will in all events be conditioned upon the
Holder cooperating with the Company and the Warrant Agent in any reasonable
arrangement designed to minimize or eliminate any such taxes. Neither the
Company nor the Warrant Agent will be required to pay any tax or governmental
charge that may be payable in connection with any transfer, split up,
combination or exchange of Warrants or Warrant Certificates.

     2.4 Cancellation and Destruction of Warrant Certificates. All Warrant
Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange will, if surrendered to the Company, be delivered to the
Warrant Agent for cancellation or in canceled form, or, if surrendered to the
Warrant Agent, will be canceled by it, and no Warrant Certificates will be
issued in lieu thereof except as expressly permitted by this Agreement. The
Company will deliver to the Warrant Agent for cancellation and retirement, and
the Warrant Agent will so cancel and retire, any other Warrant Certificate
purchased or acquired by the Company otherwise than upon the exercise thereof.
The Warrant Agent will destroy such canceled Warrant Certificates and deliver a
certificate of destruction thereof to the Company.

     3. Exercise of Warrants.

     3.1 Exercise of Warrants. (a) Warrants may be exercised by the Holder
thereof, in whole or in part, at any time and from time to time after the date
hereof and prior to 5:00 p.m., New York City time on the fifth anniversary of
the date hereof (the "Expiration Date") by delivering to the Warrant Agent, at
its principal office designated for such purpose, the following:

          (i) the Warrant Certificate or Warrant Certificates representing the
     Warrants to be exercised, with the Form of Exercise Notice duly executed by
     the Holder thereof; and

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          (ii) cash, a certified or bank cashier's check payable to the order of
     the Company, or a wire transfer to an account designated by the Company, in
     each case in an amount equal to the product of (A) the number of Warrant
     Shares purchasable upon the exercise of the Warrants designated for
     exercise in the Form of Exercise Notice and (B) the Warrant Price.

          (a) As promptly as practicable after an exercise of Warrants in
     accordance with Section 3.1(a), and in any event within 10 Business Days
     (as defined below) after such exercise, the Warrant Agent will (i)
     requisition from any transfer agent for the Common Stock (or make
     available, if the Warrant Agent is the transfer agent) certificates
     representing the number of Warrant Shares to be purchased (and the Company
     hereby irrevocably authorizes and directs its transfer agent to comply with
     all such requests), (ii) after receipt of such certificates, cause the same
     to be delivered to or upon the order of the Holder exercising such
     Warrants, registered in such name or names as may be designated by such
     Holder, (iii) when appropriate, requisition from the Company the amount of
     cash to be paid in lieu of the issuance of fractional Warrant Shares in
     accordance with the provisions of Section 5, and (iv) when appropriate,
     after receipt, deliver such cash to or upon the order of the Holder
     exercising such Warrants.

          (b) If the number of Warrants represented by a Warrant Certificate are
     not exercised in full, the Company will prepare, execute and deliver to the
     Warrant Agent a new Warrant Certificate evidencing Warrants equivalent to
     such Warrants remaining unexercised and the Warrant Agent will countersign
     and deliver such new Warrant Certificate to or upon the order of the Holder
     exercising such Warrants, registered in such name or names as may be
     designated by such Holder.

          (c) The Company will take all such action as may be necessary to
     ensure that all Warrant Shares delivered upon exercise of Warrants, at the
     time of delivery of the certificates for such Warrant Shares, will (subject
     to payment of the Warrant Price) be duly and validly authorized and issued,
     fully paid and nonassessable and, if shares of Common Stock are then listed
     on any national securities exchange (as defined in the Securities Exchange
     Act of 1934, as amended) or qualified for quotation on The Nasdaq Stock
     Market, Inc., will be duly listed or qualified for quotation thereon, as
     the case may be.

          (d) In the event that the Company is obligated to pay cash in lieu of
     fractional Warrant Shares pursuant to Section 5 in connection with any
     exercise of Warrants, it will make all arrangements necessary so that such
     cash is available for distribution by the Warrant Agent, if and when
     appropriate.

          (e) The Company will pay all expenses, taxes and other charges payable
     in connection with the preparation, issuance and delivery of certificates
     representing Warrant Shares or Warrant Certificates representing
     unexercised Warrants in connection with any exercise of Warrants in
     accordance with Section 3.1(a), except that, if any such certificates
     representing Warrant Shares or any such Warrant Certificates are to be
     registered in a name or names other than that of the Holder at the time of
     any such exercise of Warrants, funds sufficient to pay all transfer or
     similar taxes payable as a

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     result of such transfer shall be paid by the Holder at the time of such
     exercise or promptly upon receipt of a written request of the Company for
     payment thereof. In connection with any exercise of Warrants in accordance
     with Section 3.1(a), the Warrants will be deemed to have been exercised,
     any certificate representing Warrant Shares or any Warrant Certificate
     issued on account thereof will be deemed to have been issued, and the
     person in whose name any such certificate or Warrant Certificate is issued
     will be deemed for all purposes to have become a holder of record of the
     Warrant Shares or Warrants, as the case may be, represented thereby as of
     the date of such exercise.

     3.2 Certain Definitions. For purposes of this Agreement, (a) the term
"Business Day" means any day other than a Saturday, Sunday or a day on which
banking institutions in the state of New York are authorized or obligated by law
or executive order to close and (b) the term "Trading Day" means any day on
which shares of Common Stock are traded on the principal national securities
exchange on which the shares of Common Stock are listed or admitted to trading
or, if shares of Common Stock are not so listed or admitted to trading, in the
over-the-counter market.

     4. Adjustments of Warrant Price and Warrant Shares. The Warrant Price and
the number and kind of Warrant Shares purchasable upon exercise of the Warrants
will be subject to adjustment from time to time upon the occurrence of certain
events as provided in this Section 4.

     4.1 Mechanical Adjustments. The Warrant Price and the number and kind of
Warrant Shares purchasable upon exercise of a Warrant will be subject to
adjustment as follows:

          (a) Subject to Section 4.1(f), if the Company (i) pays a dividend or
     otherwise distributes to holders of its Common Stock, as such, shares of
     its capital stock (whether Common Stock or capital stock of any other
     class), (ii) subdivides its outstanding shares of Common Stock into a
     greater number of shares of Common Stock, (iii) combines its outstanding
     shares of Common Stock into a smaller number of shares of Common Stock, or
     (iv) issues any shares of its capital stock in a reclassification of its
     outstanding shares of Common Stock (including any such reclassification in
     connection with a consolidation, merger or other business combination
     transaction in which the Company is the continuing or surviving
     corporation), then the number and kind of Warrant Shares purchasable upon
     exercise of each Warrant immediately prior thereto will be adjusted so that
     the Holder of each Warrant will be entitled to receive (A) in the case of a
     dividend or distribution, the sum of (1) the number of Warrant Shares that,
     if such Warrant had been exercised immediately prior to such adjustment,
     such Holder would have received upon such exercise and (2) the number and
     kind of additional shares of capital stock that such Holder would have been
     entitled to receive as a result of such dividend or distribution by virtue
     of its ownership of such Warrant Shares, (B) in the case of a subdivision
     or combination, the number of Warrant Shares that, if such Warrant had been
     exercised immediately prior to such adjustment, such Holder would have
     received upon such exercise, adjusted to give effect to such subdivision or
     combination as if such Warrant Shares had been subject thereto, or (C) in
     the case of an issuance in a reclassification, the sum of (1) the number of
     Warrant Shares that, if such Warrant had been exercised immediately prior
     to such adjustment, such Holder would have received upon such exercise and
     retained after giving effect to such reclassification as if such Warrants

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     Shares had been subject thereto and (2) the number and kind of additional
     shares of capital stock that such Holder would have been entitled to
     receive as a result of such reclassification as if such Warrant Shares had
     been subject thereto. An adjustment made pursuant to this paragraph (a), in
     the case of a dividend or distribution, will be made whenever such dividend
     or distribution is made and, at such time, will become effective
     retroactive to the time that is immediately after the record date for the
     determination of stockholders entitled to receive such dividend or
     distribution and, in the case of a subdivision, combination or
     reclassification, will make each become effective immediately after the
     effective date of such subdivision, combination or reclassification.

          (b) Subject to Section 4.1(f), if the Company distributes to holders
     of its Common Stock, as such, (i) evidences of indebtedness or assets
     (excluding regular cash dividends or cash distributions payable out of
     surplus or net profits legally available therefor or those distributions
     described in Section 4(a)) of the Company or any corporation or other legal
     entity a majority of the voting equity securities or equity interests of
     which are owned, directly or indirectly, by the Company (a "Subsidiary"),
     (ii) shares of capital stock of any Subsidiary, (iii) securities
     convertible into or exchangeable for capital stock of the Company
     (including Common Stock or capital stock of any other class) or any
     Subsidiary, or (iv) any rights, options or warrants to purchase any of the
     foregoing (excluding those described in Section 4.1(c)), then the number of
     Warrant Shares thereafter purchasable upon exercise of each Warrant will be
     adjusted to the number that results from multiplying the number of Warrant
     Shares purchasable upon the exercise of each Warrant immediately prior to
     such adjustment by a fraction (not to be less than one), the numerator of
     which will be the Current Market Price (as defined below) per share of
     Common Stock on the record date for such distribution, and the denominator
     of which will be such Current Market Price per share of Common Stock less
     the fair value (as determined in good faith by the Board of Directors of
     the Company, whose determination will be conclusive if based on the
     financial advice of a nationally recognized investment banking firm) of the
     portion of the evidences of indebtedness, assets, securities or rights,
     options or warrants so distributed on account of one share of Common Stock.
     Such adjustment will be made whenever any such distribution is made and, at
     such time, will become effective retroactive to the time that is
     immediately after the record date for the determination of stockholders
     entitled to receive such distribution. Except as provided in Section
     4.1(i), no further adjustments of the number of Warrant Shares will be made
     upon the actual conversion or exchange of such convertible or exchangeable
     securities or upon the actual exercise of such rights, options or warrants.
     If the fair value (as so determined) of the portion of the evidences of
     indebtedness, assets, securities or rights, options or warrants so
     distributed on account of one share of Common Stock is equal to or greater
     than the Current Market Price per share of Common Stock on the record date
     for such distribution, in lieu of the foregoing adjustment, then provision
     will be made so that the Holder of each Warrant will be entitled to receive
     the sum of (A) the number of Warrant Shares that, if such Warrant had been
     exercised immediately prior to such record date, such Holder would have
     received upon exercise and (B) such evidences of indebtedness, assets,
     securities or rights, options or warrants that such Holder would have been
     entitled to receive as a result of such distribution by virtue of its
     ownership of such Warrant Shares.

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          (c) Subject to Section 4.1(f), if the Company issues rights, options
     or warrants to holders of the outstanding shares of Common Stock, as such,
     entitling the holders of such rights, options or warrants to subscribe for
     or purchase shares of Common Stock at a price per share that is lower on
     the record date mentioned below than the Current Market Price per share of
     Common Stock on such record date, then the number of Warrant Shares
     thereafter purchasable upon the exercise of each Warrant will be adjusted
     to the number that results from multiplying the number of Warrant Shares
     purchasable upon exercise of each Warrant immediately prior to such
     adjustment by a fraction (not to be less than one), the numerator of which
     will be the number of shares of Common Stock outstanding on such record
     date plus the number of additional shares of Common Stock offered by such
     rights, options or warrants for subscription or purchase and the
     denominator of which will be the number of shares of Common Stock
     outstanding on such record date plus the number of shares of Common Stock
     which the aggregate subscription or purchase price of the total number of
     shares of Common Stock so offered would purchase at the Current Market
     Price per share of Common Stock on such record date. Such adjustment will
     be made whenever such rights, options or warrants are issued and, at such
     time, will become effective retroactive to the time that is immediately
     after the record date for the determination of stockholders entitled to
     receive such rights, options or warrants. In case such subscription or
     purchase price may be paid in a consideration part or all of which is in a
     form other than cash, the fair value of such consideration will be as
     determined by the Board of Directors of the Company, whose determination
     will be conclusive if based on the financial advice of a nationally
     recognized investment banking firm. Except as provided in Section 4.1(i),
     no further adjustments of the number of Warrant Shares will be made upon
     the actual issue of shares of Common Stock upon exercise of such rights,
     options or warrants.

          (d) Subject to Section 4.1(f), if the Company issues shares of Common
     Stock, securities convertible into or exchangeable for shares of Common
     Stock or rights, options or warrants entitling the holders of such rights,
     options or warrants to subscribe for or purchase shares of Common Stock
     (excluding shares of Common Stock, convertible or exchangeable securities
     or rights, options or warrants issued in any of the transactions described
     in paragraph (a), (b) or (c) of this Section 4.1) for a purchase price per
     share of such Common Stock, for a conversion or exchange price per share of
     Common Stock initially deliverable upon conversion or exchange of such
     securities, or for a subscription or purchase price per share of Common
     Stock initially deliverable upon exercise of such rights, options or
     warrants, that is less than the Current Market Price per share of Common
     Stock on the date the purchase, conversion, exchange or subscription price
     of such additional shares of Common Stock are first fixed, then the number
     of Warrant Shares thereafter purchasable upon the exercise of each Warrant
     will be adjusted to the number that results from multiplying the number of
     Warrant Shares purchasable upon exercise of each Warrant immediately prior
     to such adjustment by a fraction (not to be less than one), the numerator
     of which will be the number of shares of Common Stock outstanding on such
     date plus the number of additional shares of Common Stock so issued or
     issuable upon such conversion, exchange or exercise, and the denominator of
     which will be the number of shares of Common Stock outstanding on such date
     plus the number of shares of Common Stock which the aggregate purchase,
     conversion, exchange or subscription price received or receivable by the
     Company for such additional shares of

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     Common Stock would purchase at the Current Market Price per share of Common
     Stock on such date. Such adjustment will be made and become effective
     immediately after such shares of Common Stock or convertible or
     exchangeable securities are issued. In case such purchase, conversion,
     exchange or subscription price may be paid in a consideration part or all
     of which is in a form other than cash, the fair value of such consideration
     will be as determined by the Board of Directors of the Company, whose
     determination will be conclusive if based on the financial advice of a
     nationally recognized investment banking firm. Except as provided in
     Section 4.1(i), no further adjustment will be made upon the actual issue of
     shares of Common Stock upon conversion or exchange of such securities
     convertible into or exchangeable for shares of Common Stock or upon
     exercise of rights, options or warrants entitling the holders of such
     rights, options or warrants to subscribe for or purchase shares of Common
     Stock.

          (e) For purposes of this Agreement, the "Current Market Price" per
     share of Common Stock on any date will be the average of the daily closing
     prices for 20 consecutive Trading Days commencing 30 Trading Days before
     the date of such computation; provided, however, that in the event that the
     Current Market Price per share of Common Stock is determined during a
     period following the announcement of (i) a dividend or distribution on
     Common Stock payable in shares of Common Stock or securities convertible
     into or exchangeable for shares of Common Stock or (ii) any subdivision,
     combination or reclassification of shares of Common Stock, and prior to the
     expiration of 30 Trading Days after the ex-dividend date of such dividend
     or distribution, or the effective date for such subdivision, combination or
     reclassification, then, and in each such case, the Current Market Price per
     share will be appropriately adjusted to take into account ex-dividend
     trading or to reflect the Current Market Price per share per Common Stock
     equivalent. The closing price for each day (the "Closing Price") will be
     the last sale price, regular way, or, in case no such sale takes place on
     such day, the average of the closing bid and asked prices, regular way, in
     either case as reported in the principal consolidated transaction reporting
     system with respect to securities listed on the principal national
     securities exchange on which shares of Common Stock are listed or admitted
     to trading or, if shares of Common Stock are not listed or admitted to
     trading on any national securities exchange, the last quoted price or, if
     not so quoted, the average of the high bid and low asked prices in the
     over-the-counter market, as reported by The Nasdaq Stock Market, Inc. or
     such other system then in use, or, if on any such date shares of Common
     Stock are not quoted by any such organization, the average of the closing
     bid and asked prices as furnished by a professional market maker making a
     market in shares of Common Stock selected by the Board of Directors of the
     Company. If the Common Stocks are not publicly held or not so listed or
     traded, or are not the subject of available bid and asked quotes, "Current
     Market Price" per share will mean the fair value per share as determined in
     good faith by the Board of Directors of the Company.

          (f) No adjustment in the number of Warrant Shares purchasable upon the
     exercise of a Warrant will be required unless such adjustment would require
     an increase or decrease in the number of Warrant Shares purchasable upon
     the hypothetical exercise of a Warrant of at least 1%; provided, however,
     that any adjustments which by reason of this paragraph (f) are not required
     to be made currently will be carried forward and made at the time and
     together with the next subsequent adjustment which, together with any

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     adjustments so carried forward, would require an increase or decrease in
     the number of Warrant Shares purchasable upon the hypothetical exercise of
     a Warrant of 1% or more. All calculations with respect to the number of
     Warrant Shares will be made to the nearest one-thousandth of a share and
     all calculations with respect to the Warrant Price will be to the nearest
     whole cent. No adjustment in the number of Warrant Shares purchasable upon
     the exercise of a Warrant will be made under clause (i) of paragraph (a) of
     this Section 4.1 or paragraph (b), (c) or (d) of this Section 4.1 if the
     Company issues or distributes to each Holder the shares, rights, options,
     warrants, convertible or exchangeable securities, evidences of
     indebtedness, assets or other securities referred to in the applicable
     paragraph that such Holder would have been entitled to receive had the
     Warrants been exercised prior to the happening of such event or the record
     date with respect thereto (provided that, in any case in which such Holder
     would have been so entitled to receive a fractional interest in any such
     securities or assets, the Company may distribute to such Holder in lieu of
     such fractional interest cash in an amount equal to the fair value of such
     fractional interest as determined in good faith by the Board of Directors
     of the Company). No adjustment in the number of Warrant Shares purchasable
     upon the exercise of a Warrant will be made on account of: (1) any issuance
     of shares of Common Stock, or of options, rights or warrants to purchase,
     or securities convertible into or exchangeable for, shares of Common Stock,
     pursuant to the Plan, (2) any issuance of shares of Common Stock upon the
     exercise of options, rights or warrants or upon the conversion or exchange
     of convertible or exchangeable securities, in either case issued pursuant
     to the Plan or outstanding as of the date hereof, (3) any issuance of
     shares of Common Stock, or of options, rights or warrants, or of other
     securities, pursuant to a share purchase rights plan or any similar plan
     adopted by the Board of Directors of the Company, (4) any issuance of
     shares of Common Stock, or of options, rights or warrants to purchase, or
     securities convertible into or exchangeable for, shares of Common Stock, in
     accordance with any plan for the benefit of the employees or Directors of
     the Company existing as of the date hereof or contemplated by the Plan or
     any other plan adopted by the Directors of the Company for the benefit of
     the employees or Directors of the Company or any of its Subsidiaries, (5)
     any issuance of shares of Common Stock in connection with a
     Company-sponsored plan for reinvestment of dividends or interest, (6) any
     issuance of shares of Common Stock, securities convertible into or
     exchangeable for shares of Common Stock or rights, options or warrants
     entitling the holders of such rights, options or warrants to subscribe for
     or purchase shares of Common Stock pursuant to an underwritten public
     offering, in the case of an issuance of shares of Common Stock, for a price
     per share of Common Stock or, in the case of an issuance of convertible or
     exchangeable securities or rights, warrants or options involving a
     conversion or exchange price per share of Common Stock initially
     deliverable upon conversion or exchange of such convertible or exchangeable
     securities or a subscription or purchase price per share of Common Stock
     initially deliverable upon exercise of such rights, options or warrants, as
     applicable, that is equal to or greater than 95% of the Closing Price per
     share of Common Stock on the date the offering, conversion, exchange,
     subscription or purchase price of such additional shares of Common Stock is
     first fixed, or (7) any issuance of shares of Common Stock or other
     securities to the owners of any entity that is acquired by the Company in
     an arm's-length transaction approved by the Board of Directors of the

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     Company. No adjustment in the number of Warrant Shares will be made for a
     change in the par value of the shares of Common Stock.

          (g) Whenever the number of Warrant Shares purchasable upon the
     exercise of each Warrant is adjusted as herein provided, the Warrant Price
     will be adjusted by multiplying the Warrant Price in effect immediately
     prior to such adjustment by a fraction, the numerator of which will be the
     number of Warrant Shares purchasable upon the exercise of each Warrant
     immediately prior to such adjustment, and the denominator of which will be
     the number of Warrant Shares so purchasable immediately thereafter.

          (h) For the purpose of this Agreement, the term "Common Stock" means
     (i) the class of shares designated as the Common Stock of the Company as of
     the date of this Agreement, (ii) all shares of any class or classes
     (however designated) of the Company, now or hereafter authorized, the
     holders of which have the right, without limitation as to amount, either to
     all or to a part of the balance of current dividends and liquidating
     dividends after the payment of dividends and distributions on any shares
     entitled to preference, and the holders of which are ordinarily entitled to
     vote generally in the election of directors of the Company, or (iii) any
     other class of shares resulting from successive changes or
     reclassifications of such shares consisting solely of changes in par value,
     or from par value to no par value, or from no par value to par value. In
     the event that at any time, as a result of an adjustment made pursuant to
     Section 4.1(a), the Warrants become exercisable to purchase Warrant Shares
     other than shares of Common Stock, thereafter the number of such other
     shares so purchasable upon exercise of each Warrant and the Warrant Price
     payable in respect of such other shares upon the exercise of each Warrant
     will be subject to adjustment from time to time in a manner and on terms as
     nearly equivalent as practicable to the provisions with respect to the
     Warrant Shares and the Warrant Price contained in this Section 4.1.

          (i) Upon the expiration of any rights, options, warrants or conversion
     or exchange privileges, if any thereof have not been exercised, the Warrant
     Price and the number of Warrant Shares purchasable upon the exercise of
     each Warrant will, upon such expiration, be readjusted and will thereafter
     be such as it would have been had it been originally adjusted (or had the
     original adjustment not been required, as the case may be) as if (i) the
     only shares of Common Stock so issued were the shares of Common Stock, if
     any, actually issued or sold upon the exercise of such rights, options,
     warrants or conversion or exchange privileges and (ii) such shares of
     Common Stock, if any, were issued or sold for the consideration actually
     received by the Company upon such exercise, conversion or exchange plus the
     aggregate consideration, if any, actually received by the Company for the
     issuance, sale or grant of all such rights, options, warrants or conversion
     or exchange privileges whether or not exercised; provided, however, that no
     such readjustment will have the effect of increasing the Warrant Price or
     decreasing the number of Warrant Shares purchasable upon the exercise of
     each Warrant by an amount in excess of the amount of the adjustment
     initially made in respect of the issuance, sale, or grant of such rights,
     options, warrants or conversion or exchange privileges.

                                       10
<PAGE>

     4.2 Voluntary Adjustment. The Company may at its option, at any time prior
to the Expiration Date, reduce the then-current Warrant Price to any amount
deemed appropriate by the Board of Directors.

     4.3 Notice of Adjustment. Whenever the Warrant Price or the number or kind
of Warrant Shares purchasable upon exercise of the Warrants is adjusted pursuant
to any of the provisions of this Agreement, the Company will promptly give
notice to the Warrant Agent and the Holders of such adjustment or adjustments,
together with a certificate of a firm of independent public accountants selected
by the Company (who may be the regular accountants employed by the Company)
setting forth the adjustments in the Warrant Price and the number or kind of
Warrant Shares purchasable upon exercise of each Warrant, and also setting forth
a brief statement of the facts requiring such adjustments and the computations
upon which such adjustments are based. Such certificate will be conclusive
evidence of the correctness of such adjustments.

     4.4 No Adjustment for Dividends. Except as provided in Section 4.1, no
adjustment or payment in respect of any dividends will be made at any time.

     4.5 Preservation of Purchase Rights Upon Merger, Consolidation, Etc. In
case of any consolidation of the Company with or merger of the Company into
another corporation or in case of any sale, transfer or lease to another
corporation of all or substantially all the property of the Company, the Company
or such successor or purchasing corporation, as the case may be, will execute an
agreement providing that each Holder will have the right thereafter, upon
payment of an amount equal to the amount payable upon the exercise of a Warrant
immediately prior thereto, to purchase upon exercise of each Warrant the kind
and amount of securities or property that it would have owned or have been
entitled to receive after giving effect to such consolidation, merger, sale,
transfer or lease on account of the Warrant Shares that would have been
purchasable upon the exercise of such Warrant had such Warrant been exercised
immediately prior thereto (provided that, to the extent that such Holder would
have been so entitled to receive cash on account of such Warrant Shares, such
Holder may elect in connection with the exercise of a Warrant in accordance with
Section 3.1 to reduce the amount of cash that it would be entitled to receive
upon such exercise in exchange for a corresponding reduction in the amount
payable upon such exercise); provided, however, that no adjustment in respect of
dividends, interest or other income on or from such shares or other securities
or property will be made during the term of a Warrant or upon the exercise of a
Warrant. Such agreement will provide for adjustments that will be as nearly
equivalent as may be practicable to the adjustments provided for in this Section
4. The provisions of this Section 4.5 will similarly apply to successive
consolidations, mergers, sales, transfers or leases.

     4.6 Warrant Certificates. Whether or not any adjustments in the Warrant
Price or the number or kind of Warrant Shares purchasable upon the exercise of
the Warrants has been made, Warrant Certificates theretofore or thereafter
issued may continue to express the same Warrant Price and number and kind of
Warrant Shares as are stated in the Warrant Certificate initially issued.

     5. Fractional Interests. Neither the Company nor the Warrant Agent will be
required to issue fractional Warrant Shares or fractional interests in any other
securities on the exercise of

                                       11
<PAGE>

the Warrants. If any fraction of a Warrant Share or other security would, except
for the provisions of this Section 5, be issuable upon the exercise of the
Warrants, the Company will pay an amount in cash (a) in lieu of a fractional
Warrant Share, equal to the Current Market Price for one share of Common Stock
on the Trading Day immediately preceding the date on which the Warrants are
presented for exercise, multiplied by such fraction of a Warrant Share, or (b)
in lieu of a fractional interest in any other security, equal to the fair value
of such fractional interest, determined in a manner as similar as possible,
taking into account the difference in the fractional interest being valued, to
the calculation described in clause (a) of this Section 5.

     6. Warrant Agent Matters.

     6.1 Appointment of Warrant Agent. The Company hereby appoints the Warrant
Agent to act as agent for the Company and the Holders in accordance with the
terms and conditions hereof, and the Warrant Agent hereby accepts such
appointment.

     6.2 Concerning the Warrant Agent. (a) The Company will pay to the Warrant
Agent reasonable compensation for all services rendered by it hereunder and,
from time to time, on demand of the Warrant Agent, its reasonable expenses and
counsel fees and other disbursements incurred in the administration and
execution of this Agreement and the exercise and performance of its duties
hereunder. The Company will indemnify the Warrant Agent for, and hold it
harmless against, any loss, liability, suit, action, proceeding or expense,
incurred without negligence, bad faith or willful misconduct on the part of the
Warrant Agent, for anything done or omitted by the Warrant Agent in connection
with the acceptance and administration of this Agreement, including the costs
and expenses of defending against any claim of liability arising therefrom,
directly or indirectly.

     (b) The Warrant Agent will be protected and will incur no liability for or
in respect of any action taken, suffered or omitted by it in connection with its
administration of this Agreement in reliance upon any Warrant Certificate or
certificate evidencing Common Stock or other securities of the Company,
instrument of assignment or transfer, power of attorney, endorsement, affidavit,
letter, notice, direction, consent, certificate, statement, other paper or
document believed by it to be genuine and to be signed, executed and, where
necessary, verified or acknowledged by the proper person or persons.

     6.3 Merger or Consolidation or Change of Name of Warrant Agent. Any
corporation into which the Warrant Agent or any successor Warrant Agent may be
merged or with which it may be consolidated, or any corporation resulting from
any merger or consolidation to which the Warrant Agent or any successor Warrant
Agent is a party, or any corporation succeeding to the corporate trust business
of the Warrant Agent or any successor Warrant Agent, will be the successor to
the Warrant Agent under this Agreement without the execution or filing of any
paper or any further act on the part of any of the parties hereto, provided that
such corporation would be eligible for appointment as a successor Warrant Agent
under the provisions of Section 6.5.

     6.4 Duties of Warrant Agent. The Warrant Agent undertakes the duties and
obligations imposed by this Agreement upon the following terms and conditions,
by all of which the Company and the Holders, by their acceptance of Warrant
Certificates, will be bound:

                                       12
<PAGE>

          (a) The Warrant Agent may consult with legal counsel (who may be legal
     counsel for the Company), and the opinion of such counsel will be full and
     complete authorization and protection to the Warrant Agent as to any action
     taken or omitted by it in good faith and in accordance with such opinion.

          (b) Whenever in the performance of its duties under this Agreement the
     Warrant Agent deems it necessary or desirable that any fact or matter be
     proved or established by the Company prior to taking or suffering any
     action hereunder, such fact or matter (unless other evidence in respect
     thereof be herein specifically prescribed) may be deemed to be conclusively
     proved and established by a certificate signed by any one of the Chairman
     of the Board, the Chief Executive Officer, the President or any Vice
     President of the Company and delivered to the Warrant Agent; and such
     certificate will be full authorization to the Warrant Agent for any action
     taken or suffered in good faith by it under the provisions of this
     Agreement in reliance upon such certificate.

          (c) The Warrant Agent will be liable hereunder only for its own gross
     negligence, bad faith or willful misconduct.

          (d) The Warrant Agent will not be liable for or by reason of any of
     the statements of fact or recitals contained in this Agreement or in the
     Warrant Certificates or be required to verify the same, but all such
     statements and recitals are and will be deemed to have been made by the
     Company only.

          (e) The Warrant Agent will not be under any responsibility in respect
     of the validity of this Agreement or the execution and delivery hereof
     (except the due execution and delivery hereof by the Warrant Agent) or in
     respect of the validity or execution of any Warrant Certificate (except the
     due countersignature thereof by the Warrant Agent); nor will it be
     responsible for any breach by the Company of any covenant or condition
     contained in this Agreement or in any Warrant Certificate; nor will it be
     responsible for any adjustment required under the provisions of Section 4
     hereof or responsible for the manner, method or amount of any such
     adjustment or the ascertaining of the existence of facts that would require
     any such adjustment (except with respect to the exercise of Warrants
     evidenced by Warrant Certificates after actual notice of any such
     adjustment); nor will it by any act hereunder be deemed to make any
     representation or warranty as to the authorization or reservation of any
     shares of stock or other securities to be issued pursuant to this Agreement
     or any Warrant Certificate or as to whether any shares of stock or other
     securities will, when issued, be validly authorized and issued, fully paid
     and nonassessable.

          (f) The Company will perform, execute, acknowledge and deliver or
     cause to be performed, executed, acknowledged and delivered all such
     further and other acts, instruments and assurances as may reasonably be
     required by the Warrant Agent for the carrying out or performing by the
     Warrant Agent of the provisions of this Agreement.

          (g) The Warrant Agent is hereby authorized and directed to accept
     instructions with respect to the performance of its duties hereunder from
     any one of the Chairman of the Board, the Chief Executive Officer, the
     President or any Vice President

                                       13
<PAGE>

     of the Company, and to apply to such officers for advice or instructions in
     connection with its duties, and it will not be liable for any action taken
     or suffered to be taken by it in good faith in accordance with instructions
     of any such officer.

          (h) The Warrant Agent and any stockholder, director, officer or
     employee of the Warrant Agent may buy, sell or deal in any of the Warrants
     or other securities of the Company or become pecuniarily interested in any
     transaction in which the Company may be interested, or contract with or
     lend money to the Company or otherwise act as fully and freely as though it
     were not Warrant Agent under this Agreement. Nothing herein will preclude
     the Warrant Agent from acting in any other capacity for the Company or for
     any other legal entity.

          (i) The Warrant Agent may execute and exercise any of the rights or
     powers hereby vested in it or perform any duty hereunder either itself or
     by or through its attorneys or agents, and the Warrant Agent will not be
     answerable or accountable for any act, default, neglect or misconduct of
     any such attorneys or agents or for any loss to the Company resulting from
     any such act, default, neglect or misconduct, provided reasonable care was
     exercised in the selection and continued employment thereof. The Warrant
     Agent will not be under any duty or responsibility to insure compliance
     with any applicable federal or state securities laws in connection with the
     issuance, transfer or exchange of Warrant Certificates.

     6.5 Change of Warrant Agent. The Warrant Agent or any successor Warrant
Agent may resign and be discharged from its duties under this Agreement upon 30
calendar days' notice in writing mailed to the Company and to each transfer
agent of the Common Stock by registered or certified mail, and to the Holders by
first-class mail. The Company may remove the Warrant Agent or any successor
Warrant Agent upon 30 calendar days' notice in writing, mailed to the Warrant
Agent or successor Warrant Agent, as the case may be, and to each transfer agent
of the Common Stock by registered or certified mail, and to the Holders by
first-class mail. If the Warrant Agent resigns or is removed or otherwise
becomes incapable of acting, the Company will appoint a successor to the Warrant
Agent. If the Company fails to make such appointment within a period of 30
calendar days after giving notice of such removal or after it has been notified
in writing of such resignation or incapacity by the resigning or incapacitated
Warrant Agent or by any Holder (who will, with such notice, submit his Warrant
Certificate for inspection by the Company), then any Holder may apply to any
court of competent jurisdiction for the appointment of a successor Warrant
Agent. Any successor Warrant Agent, whether appointed by the Company or by such
a court, will be a corporation organized and doing business under the laws of
the United States or of the State of New York (or of any other state of the
United States so long as such corporation is authorized to do business as a
banking institution in the State of New York), in good standing, having a
principal office in the State of New York, which is authorized under such laws
to exercise corporate trust powers and is subject to supervision or examination
by federal or state authority and which has at the time of its appointment as
Warrant Agent a combined capital and surplus of at least $50 million. After
appointment, the successor Warrant Agent will be vested with the same powers,
rights, duties and responsibilities as if it had been originally named as
Warrant Agent without further act or deed; but the predecessor Warrant Agent
will deliver and transfer to the successor Warrant Agent any property at the
time held by it hereunder, and execute and deliver any further assurance,

                                       14
<PAGE>

conveyance, act or deed necessary for the purpose. Not later than the effective
date of any such appointment, the Company will file notice thereof in writing
with the predecessor Warrant Agent and each transfer agent of the Common Stock,
and mail by first class mail a notice thereof to each Holder. Failure to give
any notice provided for in this Section 6.5, however, or any defect therein,
will not affect the legality or validity of the resignation or removal of the
Warrant Agent or the appointment of the successor Warrant Agent, as the case may
be. Notwithstanding anything to the contrary contained herein, no resignation or
removal of the Warrant Agent or any successor Warrant Agent will become
effective prior to the effectiveness of the appointment of a successor Warrant
Agent therefor.

     7. Rights and Notices.

     7.1 No Rights as a Stockholder; Notices to Holders. Nothing contained in
this Agreement or in the Warrant Certificate will be construed as conferring
upon the Holders or their transferees the right to vote, or to receive
dividends, or to consent or to receive notice as a stockholder in respect of any
meeting of stockholders for the election of directors of the Company or any
other matter, or any rights whatsoever as a stockholder of the Company;
provided, however, that if, at any time prior to the Expiration Date and prior
to the exercise of all of the Warrants, any of the following events occur:

          (a) The Company declares any dividend payable in any securities upon
     its shares of Common Stock or makes any distribution (other than a regular
     cash dividend or cash distributions payable out of surplus or net profits
     legally available therefor) to the holders of its shares of Common Stock;

          (b) The Company offers to the holders of its Common Stock any shares
     of capital stock of the Company or any Subsidiary or securities convertible
     into or exchangeable for shares of capital stock of the Company or any
     Subsidiary or any option, right or warrant to subscribe for or purchase any
     thereof;

          (c) The Company distributes to the holders of its Common Stock
     evidences of indebtedness or assets (including any cash dividend which
     would result in an adjustment under Section 4.1) of the Company or any
     Subsidiary;

          (d) Any reclassification of the Common Stock, any consolidation of the
     Company with or merger of the Company into another corporation, any sale,
     transfer or lease to another corporation of all or substantially all the
     property of the Company, or any proposal of the Company to effect any of
     the foregoing transactions that has been publicly announced by the Company;
     or

          (e) Any proposal by the Company to effect a dissolution, liquidation
     or winding up of the Company that has been publicly announced by the
     Company;

then in any one or more of such events the Company will give notice of such
event to the Holders, as provided in Section 11 hereof, such giving of notice to
be completed at least ten calendar days prior to the date fixed as a record date
or the date of closing the transfer books for the determination of the
stockholders entitled to such dividend, distribution or subscription rights, or
for the determination of stockholders entitled to vote on such proposed
reclassification,

                                       15
<PAGE>

consolidation, merger, sale, transfer or lease, dissolution, liquidation or
winding up; provided, however, that no such notice will be required in respect
of any of the matters referred to in the penultimate sentence of Section 4.1(f).
Such notice will specify such record date or the date of closing the transfer
books, as the case may be, for such event. Failure to mail or receive such
notice or any defect therein or in the mailing thereof will not affect the
validity of any action taken in connection with such event.

     7.2 Agreements Respecting Warrants. The Company will not enter into any
agreement or instrument which would preclude the exercise of the Warrants as
herein provided.

     8. Agreement of Warrant Holders. Every Holder by accepting a Warrant
Certificate consents and agrees with the Company and the Warrant Agent and with
every other Holder that:

          (a) The Warrant Certificates are transferable only in accordance with
     the terms of this Agreement and only on the registry books of the Warrant
     Agent if surrendered at the principal office of the Warrant Agent
     designated for such purpose, duly endorsed or accompanied by a proper
     instrument of transfer, and otherwise in compliance with Section 2;

          (b) The Company and the Warrant Agent may deem and treat the person in
     whose name the Warrant Certificate is registered as the absolute owner
     thereof and of the Warrants evidenced thereby (notwithstanding any
     notations of ownership or writing on the Warrant Certificate made by anyone
     other than the Company or the Warrant Agent) for all purposes whatsoever,
     and neither the Company nor the Warrant Agent will be affected by any
     notice to the contrary;

          (c) Such Holder expressly waives any right to receive any fractional
     Warrants and any fractional securities upon exercise or exchange of a
     Warrant; and

          (d) Notwithstanding anything in this Agreement to the contrary,
     neither the Company nor the Warrant Agent will have any liability to any
     Holder or other person as a result of its inability to perform any of its
     obligations under this Agreement by reason of any preliminary or permanent
     injunction or other order, decree or ruling issued by a court of competent
     jurisdiction or by a governmental, regulatory or administrative agency or
     commission, or any statute, rule, regulation or executive order promulgated
     or enacted by any governmental authority, prohibiting or otherwise
     restraining performance of such obligation; provided, however, that the
     Company will use reasonable efforts to have any such order, decree or
     ruling lifted or otherwise overturned as soon as possible.

     9. Reservation of Common Stock. The Company will, for so long as Warrants
remain outstanding, reserve and keep available, solely for issuance and delivery
upon the exercise of Warrants, a number of shares of Common Stock (or, if
applicable, other securities) sufficient to provide for the exercise of all
outstanding Warrants. The transfer agent for the Common Stock (or, if
applicable, other securities) will be irrevocably authorized and directed at all
times until the exercise or expiration of the Warrants to reserve such number of
authorized shares of Common Stock (or, if applicable, other securities) as
necessary for such purpose. The

                                       16
<PAGE>

Company will keep copies of this Agreement on file with the transfer agent and
will supply the transfer agent with duly executed stock certificates for such
purpose.

     10. Representations and Warranties of the Company. The Company hereby
represents and warrants to the Warrant Agent that:

          (a) The Company is a corporation duly organized, validly existing and
     in good standing under the laws of the State of Delaware and has all
     requisite corporate power and authority to execute, deliver and perform its
     obligations hereunder and to consummate the transactions contemplated
     hereby;

          (b) The execution, delivery and performance of this Agreement by the
     Company and the consummation by the Company of the transactions
     contemplated hereby have been duly authorized by all necessary corporate
     action on the part of the Company;

          (c) The execution, delivery and performance of this Agreement by the
     Company and the consummation by the Company of the transactions
     contemplated hereby in accordance with the terms hereof will not conflict
     with, violate or constitute a breach of any material contract, agreement or
     instrument by which the Company is bound or any judgment, order, decree,
     law, statute, rule, regulation or other judicial or governmental
     restriction to which the Company is subject;

          (d) This Agreement constitutes the legal, valid and binding obligation
     of the Company, enforceable against the Company in accordance with its
     terms, except as the enforceability hereof may be limited by bankruptcy,
     insolvency, reorganization, moratorium or other similar laws affecting
     creditors' rights generally; and

          (e) The Warrants, when issued and delivered to the initial Holders as
     provided in this Agreement, and the Warrant Shares issued upon exercise of
     the Warrants, when issued, paid for and delivered as provided in this
     Agreement, will be validly issued, fully paid and nonassessable.

     11. Notices. All notices, requests, waivers, releases, consents and other
communications required or permitted by this Agreement (collectively, "Notices")
must be in writing. Except as expressly otherwise provided herein with respect
to manner of delivery, notices will be deemed sufficiently given for all
purposes when delivered in person, when dispatched by telegram or electronic
facsimile transmission, when sent by first-class mail, postage prepaid or upon
confirmation of receipt when dispatched by a nationally recognized overnight
courier service to the appropriate party as follows: (a) if to a Holder, at the
address of such Holder as shown in the registry books maintained by the Warrant
Agent; (b) if to the Company, at 11th Floor, Atria III, 2225 Sheppard Avenue
East, Toronto, Ontario, Canada M2J 5C2, (416) 498-2466 (marked for the attention
of the Chief Financial Officer and the General Counsel), or at such other
address as the Company may have furnished to the Holders and the Warrant Agent
in writing; and (c) if to the Warrant Agent, at Sixth Street and Marquette
Avenue, MAC N9303-120, Minneapolis, MN 55479 or at such other address as the
Warrant Agent may have furnished to the Company and the Holders in writing.

                                       17
<PAGE>

     12. Amendment and Waiver. No failure or delay of the Holder in exercising
any power or right hereunder (other than a failure to exercise Warrants in
accordance with the provisions hereof) will operate as a waiver thereof, nor
will any single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. No notice or demand on the Company in any case will entitle the
Company to any other or future notice or demand in similar or other
circumstances. Subject to the last sentence of this Section 12, (a) if the
Company so directs, the Company and the Warrant Agent will supplement or amend
this Agreement without the approval of any Holders in order to cure any
ambiguity or correct or supplement any provision contained herein which may be
defective or inconsistent with any other provisions herein and (b) the Company
and the Warrant Agent may from time to time supplement or amend this Agreement,
with the consent of Holders of at least 50% of the Warrants then outstanding,
for any other purpose. Notwithstanding anything in this Agreement to the
contrary, no supplement or amendment which increases the Warrant Price,
decreases the period of time remaining during which the Warrants may be
exercised, or changes in a manner adverse to Holders the number of Warrant
Shares purchasable upon the exercise of Warrants will be made without the
consent of all Holders. Any such amendment, modification or waiver effected
pursuant to and in accordance with the provisions of this Section 12 will be
binding upon all Holders and upon each future Holder, the Company and the
Warrant Agent. In the event of any such amendment, modification or waiver, the
Company will give prompt notice thereof to all Holders and, if appropriate,
notation thereof will be made on all Warrant Certificates thereafter surrendered
for registration of transfer or exchange.

     13. Successors and Assigns. This Agreement will be binding upon and inure
to the benefit of the parties hereto, their respective successors and permitted
assigns, and, subject to Sections 1.4 and 8(b), all Holders, but will not be
assignable or delegable by any party without the prior written consent of the
other parties. In the absence of such prior written consent, any purported
assignment or delegation of any right or obligation hereunder will be null and
void.

     14. Rights of the Parties. Except as provided in Section 13, nothing
expressed or implied in this Agreement is intended or will be construed to
confer upon or give any person or entity other than the parties hereto and the
Holders any rights or remedies under or by reason of this Agreement or any
transaction contemplated hereby. All rights of action in respect of this
Agreement are vested in the Holders, and any Holder without the consent of the
Warrant Agent or any other Holder may, on such Holder's own behalf and for such
Holder's own benefit, enforce such Holder's rights hereunder, including the
right to exercise, exchange or surrender for transfer such Holder's Warrant
Certificates in accordance with the provisions hereof.

     15. Titles and Headings. Titles and headings to Sections herein are
inserted for convenience of reference only, and are not intended to be a part of
or to affect the meaning or interpretation of this Agreement.

     16. Certain Interpretive Matters. (a) Unless the context otherwise
requires, (i) all references to Sections or Exhibits are to Sections or Exhibits
of or to this Agreement, (ii) each term defined in this Agreement has the
meaning assigned to it, (iii) "or" is disjunctive but not necessarily exclusive,
and (iv) words in the singular include the plural and vice versa. All references
to "$" or dollar amounts are to lawful currency of the United States of America.

                                       18
<PAGE>

     (b) No provision of this Agreement will be interpreted in favor of, or
against, any party hereto by reason of the extent to which such party or its
counsel participated in the drafting of this Agreement or by reason of the
extent to which any such provision is inconsistent with any prior draft of this
Agreement.

     17. Entire Agreement. This Agreement, together with its Exhibits,
constitutes the entire agreement among the parties hereto with respect to the
subject matter hereof, and there are no agreements among the parties hereto with
respect thereto except as expressly set forth herein.

     18. Severability. In case any provision contained in this Agreement is
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions will not in any way be affected or impaired thereby.
The Company and the Warrant Agent will endeavor in good faith to replace the
invalid, illegal or unenforceable provisions with valid, legal and enforceable
provisions the economic effect of which comes as close as possible to that of
the invalid, illegal or unenforceable provisions.

     19. Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the State of Delaware, without giving effect to the
principles of conflict of laws thereof.

     20. Counterparts. This Agreement may be executed in any number of
counterparts, each of which so executed will be deemed to be an original; such
counterparts will together constitute but one agreement.

                                       19
<PAGE>

     IN WITNESS WHEREOF, the parties to this Agreement have executed this
Agreement as of the date first above written.

                                       ALDERWOODS GROUP, INC.

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


                                       WELLS FARGO BANK MINNESOTA, N.A.

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

                                       20
<PAGE>

                                    EXHIBIT A

                               WARRANT CERTIFICATE

                             ALDERWOODS GROUP, INC.

THE WARRANTS REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND
CONDITIONS SET FORTH IN THE WARRANT AGREEMENT (AS HEREINAFTER DEFINED), A COPY
OF WHICH WILL BE MADE AVAILABLE BY THE ISSUER UPON REQUEST. THE TRANSFER OR
EXCHANGE OF THESE WARRANTS MUST BE REGISTERED IN ACCORDANCE WITH THE WARRANT
AGREEMENT.

NO.                                                    WARRANTS
    ------------                                                ----------------

                     VOID AFTER 5:00 P.M. NEW YORK CITY TIME
                             ON ___________ __,_____

     THIS CERTIFIES THAT for value received, __________, or its registered
assigns (the "Holder"), is the owner of the number of Warrants set forth above
that initially entitle it to purchase from Alderwoods Group, Inc., a Delaware
corporation (the "Company"), at any time and from time to time on or prior to
5:00 p.m. New York City time on ____________ __, 200__ (the "Expiration Date"),
a like number of fully paid and nonassessable shares of the Common Stock, par
value $0.01 per share, of the Company (the "Common Stock") at an initial
purchase price of $25.76 per share (the "Warrant Price"), subject to adjustment
as provided in the Warrant Agreement. The shares of Common Stock purchasable
upon exercise of the Warrants are hereinafter referred to as the "Warrant
Shares." Subject to the terms and conditions of the Warrant Agreement, the
Warrants may be exercised by surrendering to the Warrant Agent (as defined
below) this Warrant Certificate, with the Form of Exercise Notice on the reverse
side hereof duly executed, together with cash, a certified or bank cashier's
check payable to the order of the Company, or a wire transfer to an account
designated by the Company, in each case in an amount of lawful currency of the
United States of America equal to the product of (a) the number of Warrant
Shares purchasable upon the exercise of the Warrants designated for exercise in
the Form of Exercise Notice and (b) the Warrant Price.

     The number and kind of Warrant Shares that may be purchased upon exercise
of the Warrants evidenced by this Warrant Certificate are the number as of the
date of the original issue of such Warrants, based on the shares of Common Stock
of the Company as constituted at such date. As provided in the Warrant
Agreement, the Warrant Price and the number and kind of Warrant Shares
purchasable upon exercise of the Warrants are subject to adjustment.

     This Warrant Certificate and the Warrants it represents are subject to, and
entitled to the benefits of, all of the terms, provisions and conditions of the
Warrant Agreement, dated as of ___________ __, 200__ (the "Warrant Agreement"),
by and between the Company and Wells Fargo Bank Minnesota, N.A., a national
banking association (the "Warrant Agent"), which Warrant Agreement is hereby
incorporated herein by reference and made a part hereof and to which Warrant
Agreement reference is hereby made for a full description of the rights,
limitation

                                      A-1
<PAGE>

of rights, obligations and duties hereunder of the Company and the Holder. A
copy of the Warrant Agreement will be made available to the Holder by the
Company upon request of the Holder.

     Subject to the provisions set forth in the Warrant Agreement or in this
Certificate, this Warrant Certificate, with or without other Warrant
Certificates, may be transferred, split up, combined or exchanged for another
Warrant Certificate or Warrant Certificates, entitling the Holder to purchase a
like aggregate number of Warrant Shares as the Warrant Certificate or Warrant
Certificates surrendered entitled such Holder (or former Holder in the case of a
transfer) to purchase, upon presentation and surrender hereof at the principal
office of the Warrant Agent designated for such purpose, with the Form of
Assignment (if appropriate) and the related Certificate duly executed.

     The Company will not be required to issue fractional Warrant Shares or
other fractional interests in securities upon the exercise of any Warrants
evidenced by this Warrant Certificate, but in lieu thereof a cash payment will
be made, as provided in the Warrant Agreement.

     Nothing contained in the Warrant Agreement or in this Warrant Certificate
will be construed as conferring upon the holder of this Warrant Certificate the
right to vote, or to receive dividends, or to consent or (except as provided in
the Warrant Agreement) to receive notice in respect of any meeting of
stockholders for the election of directors of the Company or any other matter,
or any rights whatsoever as a stockholder of the Company.

     This Warrant Certificate will not be valid or obligatory for any purpose
until it has been countersigned by the Warrant Agent.

                                      A-2
<PAGE>

     IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
executed by its corporate officers duly authorized.

Attest:                                 ALDERWOODS GROUP, INC.

                                        By:
-----------------------------------        ------------------------------------
[Name, title]                              [Name, title]

Dated: ___________,____

Countersigned:

WELLS FARGO BANK MINNESOTA, N.A.

By:
    -------------------------------
    [Authorized Signature]

                                      A-3
<PAGE>

                   Form of Reverse Side of Warrant Certificate

                               FORM OF ASSIGNMENT

           (To be executed if the Holder desires to transfer Warrants)


     FOR VALUE RECEIVED, __________________________________________ hereby
sells, assigns, and transfers unto _____________________________________________
________________________________________________________________________________
                  (Please print name and address of transferee)

________________________________________________________________________________
this Warrant Certificate, together with all right, title, and interest therein,
and does hereby irrevocably constitute and appoint ____________ Attorney, to
transfer the within Warrant Certificate on the books of the within-named
Company, with full power of substitution.

Dated: _______________, ______

                                       -----------------------------------------
                                       Signature

Signature Guaranteed:

                                      A-4
<PAGE>

                             FORM OF EXERCISE NOTICE

           (To be executed if the Holder desires to exercise Warrants)

TO ALDERWOODS GROUP, INC.

     The undersigned hereby irrevocably elects to exercise __________ Warrants
evidenced by this Warrant Certificate to purchase the Warrant Shares issuable
upon the exercise of such Warrants and requests that certificates for such
Warrant Shares be issued in the name of:


--------------------------------------------------------------------------------
                         (Please print name and address)

--------------------------------------------------------------------------------

Please insert social security or
other identifying number:
                          ------------------------------------------------------

If such number of Warrants is not all the Warrants evidenced by this Warrant
Certificate, a new Warrant Certificate for the balance remaining of such
Warrants will be registered in the name of and delivered to:


--------------------------------------------------------------------------------
                         (Please print name and address)

--------------------------------------------------------------------------------

Please insert social security
or other identifying number:
                             ---------------------------------------------------

Dated: ________________, _____

                                       -----------------------------------------
                                       Signature

Signature Guaranteed:

                                      A-5
<PAGE>

                                     NOTICE

     Signatures on the foregoing Form of Assignment and Form of Exercise Notice
and in the related Warrant Certificates must correspond to the name as written
upon the face of this Warrant Certificate in every particular, without
alternation or enlargement or any change whatsoever.

     Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc., or a commercial bank or trust company having an office or correspondent in
the United States.

                                      A-6