EXHIBIT 10.05

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                              COMMON STOCK WARRANT
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                                    DVL, INC.

                              COMMON STOCK WARRANT

                     THE TRANSFERABILITY OF THIS WARRANT IS
                      RESTRICTED AS PROVIDED IN SECTION 2.

VOID AFTER FEBRUARY 15, 2011               RIGHT TO PURCHASE 2,000,000 OF THE
                                           AGGREGATE SHARES OF COMMON
STOCK
                                           OF THE COMPANY (SUBJECT TO ADJUSTMENT
                                           PURSUANT TO SECTION 3.4(B) HEREOF)

NO. ______
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                                    PREAMBLE
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       DVL, INC., a Delaware corporation (the "Company"), for value received,
hereby certifies that J.G. WENTWORTH S.S.C., LIMITED PARTNERSHIP, a Nevada
limited partnership (its permitted successors, assigns and transferees, the
"HOLDER OF THIS WARRANT", or the "HOLDER HEREOF") is entitled, subject to the
terms set forth below, to purchase from the Company at any time or from time to
time before 5:00 P.M. New York time, February 15, 2011 (the "EXPIRATION DATE"),
2,000,000 fully paid and nonassessable shares of Common Stock, par value $0.01
per share (collectively, the "COMMON STOCK") of the Company, at a purchase price
of $0.20 per share (such price, the "INITIAL PURCHASE PRICE"). The number and
character of such shares of Common Stock and the Initial Purchase Price are
subject to adjustment as provided herein.

       This Warrant (the "WARRANT") evidencing the right to purchase shares of
Common Stock of the Company, is issued pursuant to a certain Purchase Agreement
effective as of February 15, 2001 (the "AGREEMENT"), by and among the Company,
J.G. Wentworth S.S.C., Limited Partnership, J.G. Wentworth Management Company,
Inc. (with respect to Sections 2(b) and (c) and 8 thereof), J.G. Wentworth
Receivables II LLC, Receivables II-A Holding Company LLC,
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Receivables II-A LLC and S2 Holdings, Inc. Copies of the Agreement are on file
at the principal office of the Company.

       THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED BY THE
       HOLDER HEREOF FOR ITS OWN ACCOUNT, FOR INVESTMENT PURPOSES AND NOT WITH A
       VIEW TO THE DISTRIBUTION OF SUCH SECURITIES. THE SECURITIES HAVE NOT BEEN
       REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE SOLD OR
       OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
       STATEMENT UNDER THE ACT OR AN EXEMPTION THEREFROM.

       EACH OF THE CERTIFICATE OF INCORPORATION (THE "CERTIFICATE") AND THE BY-
       LAWS (THE "BY-LAWS") OF THE COMPANY CONTAINS RESTRICTIONS PROHIBITING THE
       SALE, TRANSFER, DISPOSITION, PURCHASE OR ACQUISITION OF ANY CAPITAL STOCK
       UNTIL SEPTEMBER 30, 2009, WITHOUT THE AUTHORIZATION OF THE BOARD OF
       DIRECTORS OF THE COMPANY (THE "BOARD OF DIRECTORS"), BY OR TO ANY HOLDER

       (A) WHO BENEFICIALLY OWNS DIRECTLY OR THROUGH ATTRIBUTION (AS GENERALLY
       DETERMINED UNDER SECTION 382 OF THE CODE) FIVE PERCENT OR MORE OF VALUE
       OF THE THEN ISSUED AND OUTSTANDING SHARES OF CAPITAL STOCK OF THE COMPANY
       OR

       (B) WHO, UPON THE SALE, TRANSFER, DISPOSITION, PURCHASE OR ACQUISITION OF
       ANY CAPITAL STOCK OF THE COMPANY WOULD BENEFICIALLY OWN DIRECTLY OR
       THROUGH ATTRIBUTION (AS GENERALLY DETERMINED UNDER SECTION 382 OF THE
       CODE) FIVE PERCENT OR MORE OF THE VALUE OF THE THEN ISSUED AND
       OUTSTANDING CAPITAL STOCK OF THE COMPANY, IF THAT SALE, TRANSFER,
       DISPOSITION, PURCHASE OR ACQUISITION WOULD, IN THE SOLE DISCRETION AND
       JUDGMENT OF THE BOARD OF DIRECTORS, JEOPARDIZE THE COMPANY'S PRESERVATION
       OF ITS FEDERAL INCOME TAX ATTRIBUTES PURSUANT TO SECTION 382 OF THE CODE.
       THE COMPANY WILL FURNISH WITHOUT CHARGE TO THE HOLDER OF RECORD OF THIS
       WARRANT A COPY OF THE CERTIFICATE AND/OR BY-LAWS, CONTAINING THE
       ABOVE-REFERENCED RESTRICTIONS ON TRANSFER OF STOCK, UPON WRITTEN REQUEST
       TO THE COMPANY AT ITS PRINCIPAL PLACE OF BUSINESS.

                                   DEFINITIONS

       1.     DEFINITIONS. As used herein, each of the following terms, unless
the context otherwise requires, shall have the meaning set forth below:

              "BUSINESS DAY" shall mean any day that is not a Saturday, a
Sunday, or a day on which banks are required or permitted to be closed in the
State of New York.

              "CODE" means the Internal Revenue Code of 1986, as amended.

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              "COMPANY" means the Company and any corporation or other legal
entity which shall succeed to or assume the obligations of the Company hereunder
in compliance with SECTION 6 hereof.

              "COMMON STOCK" means all stock of any class or classes (however
designated) of the Company, authorized on or after the date hereof, the holders
of which shall have the right, without limitation as to amount, either to all or
to a share 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 shall ordinarily, in the absence of contingencies, be
entitled to vote for the election of a majority of directors of the Company
(even though the right so to vote has been suspended by the happening of such a
contingency).

              "CONVERTIBLE SECURITIES" shall mean any indebtedness, shares of
stock or other securities convertible into or exchangeable for Common Stock.

              "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect from time to time.

              "FAIR VALUE" shall mean with respect to Common Stock the current
Market Price per share of such Common Stock at any date and, with respect to any
other assets, shall be deemed to be the fair market value as determined, in good
faith, by the Board of Directors of the Company (such value, the "BOARD
VALUATION"); PROVIDED HOWEVER that if the holder hereof disputes the Board
Valuation on or before 15 Business Days after the date the Board of Directors of
the Company notifies such holder in writing of such Board Valuation, then, such
holder shall be entitled to require the Board of Directors to retain an
independent investment banker of the Board of Directors' choosing, at the
expense of such holder, to determine such fair market value (such value, the
"INDEPENDENT VALUATION"). It is agreed that the higher of (1) the Board
Valuation and (2) the Independent Valuation shall constitute such "Fair Value"
for all purposes.

              "INITIAL PURCHASE PRICE" shall have the meaning set forth in the
Preamble to this Warrant.

              "MARKET PRICE" shall, at any given time, mean the average closing
price, during the prior 30 Business Days, for a share of Common Stock as listed
on any public exchange or automated quotation system, or the average bid price
during such 30 Business Days for a share of Common Stock as traded in the
over-the-counter market. In the event that the Common Stock is no longer listed
on any public exchange or automated quotation system or traded in the over-the-
counter market, THEN, the "Market Price" shall be equal to the "Fair Value."

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              "NASD" shall mean the National Association of Securities Dealers,
Inc., or any successor corporation thereto.

              "NET CONSIDERATION PER SHARE" shall mean the amount equal to the
total amount of consideration received by the Company for the sale or issuance
of Common Stock, Options or Convertible Securities plus, in the case of Options
or Convertible Securities, the minimum amount of consideration, if any, payable
to the Company upon exercise or conversion thereof, divided by the aggregate
number of shares of Common Stock that would be issued if all such Options or
Convertible Securities were exercised, exchanged or converted.

              "OPTIONS" shall mean any rights, warrants or options to subscribe
for or purchase Common Stock or Convertible Securities.

              "OTHER SECURITIES" means any stock (other than Common Stock) and
other securities of the Company or any other person (corporate or otherwise)
which the holders of the Warrants at any time shall be entitled to receive, or
shall have received, on the exercise of the Warrants, in lieu of or in addition
to Common Stock, or which at any time shall be issuable or shall have been
issued in exchange for or in replacement of Common Stock or Other Securities
pursuant to SECTION 6 or otherwise.

              "PERSON" shall mean any natural or legal person.

              "PURCHASE PRICE" shall mean the Initial Purchase Price, as
adjusted in accordance with this Warrant.

              "REGISTRABLE SECURITIES" shall mean the collective reference to
(1) the shares of Common Stock issued hereunder to the holder of this Warrant,
(2) this Warrant, and (3) the Shares.

              "SECURITIES ACT" means the Securities Act of 1933, or any
successor federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.

              "SECURITIES AND EXCHANGE COMMISSION" or "COMMISSION" means the
Securities and Exchange Commission or any other federal agency then
administering the Securities Act.

              "SHARES" means the Common Stock and Other Securities issued or
issuable upon exercise of this Warrant.

              "WARRANT" shall have the meaning set forth in the Preamble to this
Warrant.

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       2.     RESTRICTED STOCK.

              2.1    Without limitation of the restrictions of SECTION 2.3
hereof, if, at the time of any transfer or exchange (other than a transfer or
exchange not involving a change in the beneficial ownership of this Warrant or
Shares) of all or any portion of this Warrant or Shares, this Warrant or such
Shares shall not be registered under the Securities Act, the Company may
require, as a condition of allowing such transfer or exchange, that the holder
of this Warrant or such Shares, as the case may be, furnish to the Company an
opinion of counsel reasonably acceptable to the Company or, at the election of
the holder of this Warrant, a "no action" or similar letter from the Securities
and Exchange Commission to the effect that such transfer or exchange may be made
without registration under the Securities Act. In the case of such a transfer or
exchange and in the case of an exercise of this Warrant if the Shares to be
issued thereupon are not registered pursuant to the Securities Act, the Company
may require a written statement that such Warrant or Shares, as the case may be,
are being acquired for investment and not with a view to the distribution
thereof. The certificates evidencing the Shares issued on the exercise of this
Warrant shall, if such Shares are being sold or transferred without registration
under the Securities Act, bear a legend to the effect that the Shares evidenced
by such certificates have not been so registered.

              2.2    (a)    The Company shall at all times maintain and keep
available adequate public information, as those terms are understood and defined
in Rule 144 under the Securities Act.

                     (b)    The Company shall furnish to the holder hereof
and/or a prospective purchaser designated by such holder of this Warrant or
Shares, forthwith upon request, (i) a copy of the most recent annual or
quarterly report of the Company, (ii) any other reports and documents necessary
to satisfy the information-furnishing condition to offers and sales under Rule
144A under the Securities Act, and (iii) such other reports and documents as the
holder of this Warrant or Shares or any prospective purchaser thereof reasonably
requests to avail itself of any rule or regulation of the Commission allowing
such holder to sell any such securities without registration.

              2.3    (a)    During the term of this Warrant, the holder hereof
shall not sell, transfer, or dispose, or purchase or acquire in any manner
whatsoever, whether voluntarily or involuntarily, by operation of law or
otherwise (any such sale, transfer, disposition, purchase, acquisition or
contract being a "TRANSFER"), this Warrant or the Shares, except as authorized
pursuant to this SECTION 2.3. Notwithstanding anything to the contrary set forth
in this Warrant, this Warrant may not be exercised, in full or in part, unless
(i) the Company obtains a favorable legal opinion, reasonably acceptable in form
and substance to the Company and the holder hereof, to the effect that the
exercise of the Warrant by such holder of this Warrant shall not result in a
limitation of the Company's use of any net operating loss carryforwards solely
by

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reason of the applicability of Section 382 of the Code (provided that, upon the
request of the holder hereof, the Company shall cooperate in good faith with
such holder in furnishing any information reasonably required to produce such
opinion); or (ii) as provided in SECTION 6.

                     (b)    (i)    The restrictions contained in this SECTION
2.3 are for the purpose of reducing the risk that any change in stock ownership
may jeopardize the preservation of the Company's federal income tax attributes.
In connection therewith, and to provide for the effective policing of these
provisions, prior to the date of a proposed Transfer by the holder hereof, such
holder shall request in writing (a "REQUEST") that the Board of Directors of the
Company review the proposed Transfer and authorize or not authorize the proposed
Transfer pursuant to SUBSECTION (b)(iii) hereof. A Request shall be mailed or
delivered to the President of the Company at the Company's principal place of
business or telecopied to the Company's telecopier number at its principal place
of business. Such Request shall be deemed to have been delivered when actually
received by the Company. A Request shall include: (a) a description of this
Warrant or the Shares proposed to be Transferred by the holder hereof, (b) the
date on which the proposed Transfer is expected to take place, (c) the name of
the proposed transferee, and (d) a Request that the Board of Directors
authorize, if appropriate, the Transfer pursuant to SUBSECTION (b)(iii) hereof
and inform the holder hereof of its determination regarding the proposed
Transfer. If the holder hereof seeks to sell or dispose of this Warrant or the
Shares, then, as soon as reasonably practicable after receipt by the President
of the Company of a Request, a meeting of the Board of Directors shall be held
to determine whether to authorize the proposed Transfer described in the Request
under SUBSECTION (b)(iii) hereof. The Board of Directors shall conclusively
determine whether to authorize the proposed Transfer, in its sole discretion and
judgment, and shall immediately cause the holder hereof to be informed of such
determination; PROVIDED THAT, upon the request of the holder hereof, the Company
shall cooperate in good faith with such holder in furnishing any information
reasonably required by the Board of Directors to make such conclusive
determination.

                            (ii)   Any Transfer attempted to be made in
violation of this SECTION 2.3 will be null and void. In the event of an
attempted or purported Transfer involving a sale or disposition of this Warrant
or the Shares in violation of this SECTION 2.3 the holder hereof shall remain
the owner.

                            (iii)  The Board of Directors shall authorize a
Transfer by the holder hereof, if, in its sole discretion and judgment, it
determines that the Transfer will not jeopardize the Company's preservation of
its federal income tax attributes pursuant to Code Section 382. In deciding
whether to approve any proposed Transfer by the holder hereof, the Board of
Directors may seek the advice of counsel with respect to the Company's
preservation of its federal income tax attributes pursuant to Code Section 382
and may request all relevant information from the holder hereof with respect to
all capital stock directly or indirectly owned by such holder. The holder hereof
shall reimburse the Company, on demand, for all costs and expenses incurred by

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the Company with respect to any proposed Transfer, including, without
limitation, the Company's costs and expenses incurred in determining whether to
authorize that proposed Transfer.

       3.     EXERCISE OF WARRANT.

              3.1    EXERCISE IN FULL. Subject to SECTION 2.3(b), the holder of
this Warrant may at its option not later than the Expiration Date exercise it in
full by surrendering this Warrant, with the form of subscription at the end
hereof duly executed by such holder, to the Company at its principal office,
attention the Secretary of the Company. The surrendered Warrant shall be
accompanied by payment of the Purchase Price as set forth below for the number
of shares of Common Stock which may be purchased hereunder. At the option of the
holder of this Warrant, payment of the Purchase Price shall be made by (a) wire
transfer of funds to an account in a bank located in the United States
designated by the Company for such purpose, (b) certified or official bank check
payable to the order of the Company, or (c) any combination of such methods.

              3.2    PARTIAL EXERCISE. Subject to SECTION 3.4, the holder of
this Warrant may at its option at any time or from time to time, but not later
than the Expiration Date, exercise this Warrant in part by surrender of this
Warrant in the manner and at the place provided in SECTION 3.1, except that the
amount obtained shall be designated by the holder of this Warrant in the
subscription at the end hereof as provided herein. The Purchase Price shall be
payable by the holder of this Warrant in accordance with SECTION 3.1. On any
such partial exercise the Company at its expense will forthwith issue and
deliver to or upon the order of the holder hereof a new Warrant or Warrants of
like tenor, in the name of the holder hereof or as such holder may request,
calling in the aggregate on the face or faces thereof for the number of shares
of Common Stock equal to the number of such shares called for on the face of
this Warrant minus the number of such shares designated by the holder of this
Warrant in the subscription at the end hereof, subject to adjustment as provided
herein.

              3.3    SHARES TO BE FULLY PAID. The Company covenants and agrees
that all Shares which may be issued upon the exercise of the rights represented
by this Warrant will, upon issuance, be duly authorized, validly issued, fully
paid and nonassessable and free from all preemptive rights of any stockholder
and free of all taxes, liens and charges with respect to the issue thereof. The
Company will take all such action as may be necessary to assure that such shares
of Common Stock may be issued as provided herein without violation of any
applicable law or regulation, or of any requirements of any domestic securities
exchange or automated quotation system upon which the Common Stock may be
listed.

              3.4    LIMITATIONS ON EXERCISE OF WARRANT. (a) Notwithstanding
anything to the contrary set forth in this Warrant, this Warrant may not be
exercised for any Shares prior to the first anniversary of the date of this
Warrant. On such anniversary, and on each of the second,

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third, fourth and fifth anniversaries of this Warrant, subject to adjustment
pursuant to Section 3.4(b), the number of Shares for which this Warrant may be
exercised shall be increased by 400,000 (such number of additional Shares for
which this Warrant may be exercised on any such anniversary, hereinafter
"Additional Vested Shares").

              (b)    (i)    In any year ending on or before the fourth
anniversary of this Warrant, if the amount paid to S2 Holdings, Inc. out of Cash
Flow (as defined in the Non- Negotiable, Secured Purchase Money Promissory Notes
of S2 Holdings, Inc., payable to the order of J.G. Wentworth S.S.C., Limited
Partnership (the "Notes")) during such year is less than the sum of the amounts
shown in Note 1, Column 1 and Note 2, Column 1 on Schedule A of the Notes (such
sum, the "Required Minimum Payment") for such year, then the Additional Vested
Shares for such year shall be reduced from the number calculated pursuant to
Section 3.4(a) by the number of Shares equal to the product of (i) the number of
Additional Vested Shares for such year as otherwise calculated pursuant to
Section 3.4(a), and (ii) the Cash Flow Shortfall Percentage for such year. For
purposes hereof, "Cash Flow Shortfall Percentage" for any period means the
ratio, expressed as a percentage, of (x) the dollar amount by which the Required
Minimum Payment for such period exceeds the actual Cash Flow for such period,
and (y) the Required Minimum Payment for such period.

                     (ii)   On the fifth anniversary of this Warrant, the
Additional Vested Shares for such year shall be increased or decreased, as the
case may be, such that the total number of Shares for which this Warrant may be
exercised after such date shall be equal to the difference between (i) 2,000,000
and (ii) the product of (x) 2,000,000 and (y) the Cash Flow Shortfall Percentage
for the period from the date of this Warrant through the fifth anniversary of
this Warrant.

       4.     DELIVERY OF STOCK CERTIFICATES, ETC., ON EXERCISE. As soon as
practicable after the exercise of this Warrant in full or in part, and in any
event within 20 Business Days thereafter, the Company at its expense (including
the payment by it of any applicable issue taxes) will cause to be issued in the
name of and delivered to the holder hereof, a certificate or certificates for
the number of fully paid and nonassessable Shares to which such holder shall be
entitled on such exercise. The Company agrees that the Shares purchased under
this Warrant shall be and are deemed to be issued to the holder hereof as the
record owner of such Shares as of the close of business on the date on which
this Warrant shall have been surrendered and payment made for such Shares. Each
stock certificate so delivered shall be in such denominations of Common Stock as
may be requested by holder hereof and shall be registered in the name of the
holder hereof.

       5.     ADJUSTMENT OF INITIAL PURCHASE PRICE AND NUMBER OF SHARES.

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              5.1    The Initial Purchase Price hereof shall be subject to
adjustment from time to time as follows:

              (a)    In case the Company shall (i) at any time declare or pay a
dividend on its Common Stock in shares of Common Stock, (ii) subdivide its
outstanding shares of Common Stock into a greater number of shares, or (iii)
combine its outstanding shares of Common Stock into a smaller number of shares,
then, in such an event, the Purchase Price in effect immediately prior thereto
shall be adjusted proportionately so that the adjusted Purchase Price will be
equal to the Purchase Price immediately prior to such event multiplied by a
fraction, the numerator of which is the number of shares of Common Stock
outstanding immediately prior to such event and the denominator of which is the
number of shares outstanding immediately after such event. An adjustment made
pursuant to this subdivision (a), (i) shall become effective retroactively
immediately after the record date in the case of a dividend and (ii) shall
become effective immediately after the effective date in the case of a
subdivision or combination. The Purchase Price, as so adjusted, shall be
readjusted in the same manner upon the happening of any successive event or
events described herein.

              (b)    (i)    In the event that the Company shall sell or issue
(or shall be deemed pursuant to this Subsection to sell or issue), at any time
after the issuance date of this Warrant, shares of Common Stock for Net
Consideration Per Share that is less than the Fair Value in effect on the date
of and immediately prior to such sale or issuance, then, upon such sale or
issuance (or deemed sale or issuance), the Purchase Price shall be reduced
concurrently with such sale or issuance (or deemed sale or issuance) to a
Purchase Price (calculated to the nearest one hundredth of a cent) determined by
dividing:

                            (A)    an amount equal to (x) the total number of
shares of Common Stock outstanding immediately prior to such sale or issuance
multiplied by the Purchase Price, plus (y) such Net Consideration Per Share, if
any, received or deemed received, multiplied by the number of shares of Common
Stock sold or issued (or deemed to be sold or issued), by

                            (B)    the total number of shares of Common Stock
outstanding immediately after such sale or issuance.

No adjustment in the Purchase Price shall be made which would increase the
Purchase Price in effect immediately prior to such adjustment.

              (c)    In case the Company shall distribute to holders of shares
of Common Stock any of the following: any Other Securities, evidences of its
indebtedness or assets (excluding cash dividends or cash distributions) or
purchase rights, options or warrants to subscribe for or purchase such Other
Securities, then, in each such case the Purchase Price in effect thereafter
shall be determined by multiplying the Purchase Price in effect immediately

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prior thereto by a fraction, of which the numerator shall be the total number of
outstanding shares of Common Stock multiplied by the current Market Price per
share of Common Stock on the record date mentioned below, less the Fair Value of
the Other Securities, assets or evidences of indebtedness so distributed or of
such rights or warrants, and of which the denominator shall be the total number
of outstanding shares of Common Stock multiplied by such current Market Price
per share of Common Stock. Such adjustment shall be made whenever any such
distribution is made and shall become effective retroactively immediately after
the record date for the determination of stockholders entitled to receive such
distribution.

              (d)    No adjustment of the Purchase Price shall be made if the
amount of such adjustment shall be less than one hundredth of one cent per
share, but in such case any adjustment that would otherwise be required then to
be made shall be carried forward and shall be made at the time of and together
with the next subsequent adjustment, which, together with any adjustment so
carried forward, shall amount to not less than one hundredth of one cent per
share. In case the Company shall at any time issue Common Stock by way of
dividend on any stock of the Company or subdivide or combine the outstanding
shares of the Common Stock, said amount of one hundredth of one cent per share
(as theretofore increased or decreased, if the same amount shall have been
adjusted in accordance with the provisions of this subparagraph) shall forthwith
be proportionately increased in the case of a combination or decreased in the
case of such a subdivision or stock dividend so as appropriately to reflect the
same.

              5.2    Upon each adjustment of the Purchase Price pursuant to
SECTION 5.1, the number of shares of Common Stock purchasable upon exercise of
this Warrant shall be adjusted to the number of shares of Common Stock,
calculated to the nearest one hundredth of a share, obtained by multiplying the
number of shares of Common Stock purchasable immediately prior to such
adjustment upon the exercise of this Warrant by the Purchase Price in effect
prior to such adjustment and dividing the product so obtained by the new
Purchase Price.

              5.3    In case of any capital reorganization of the Company, or of
any reclassification of the Common Stock, this Warrant shall be exercisable
after such capital reorganization or reclassification upon the terms and
conditions specified in this Warrant, for the number of shares of stock or other
securities which the Common Stock issuable (at the time of such capital
reorganization or reclassification) upon the full exercise of this Warrant would
have been entitled to receive upon such capital reorganization or
reclassification if such exercise had taken place immediately prior to such
action. The subdivision or combination of shares of Common Stock at any time
outstanding into a greater or lesser number of shares of Common Stock shall not
be deemed to be a reclassification of the Common Stock of the Company for the
purposes of this SECTION 5.3.

              5.4    Whenever the Purchase Price is adjusted as herein provided,
the Company shall compute the adjusted Purchase Price in accordance with SECTION
5.1 and shall prepare a

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certificate setting forth the adjusted Purchase Price and shall state the
effective date of the adjustment and the increase or decrease, if any, in the
number of shares purchasable at such price upon the exercise of this Warrant,
and showing in reasonable detail the method of such adjustment and the fact
requiring the adjustment and upon which such calculation is based, and such
certificate shall forthwith be forwarded to the holder of this Warrant within 90
days after the event giving rise to such event.

              5.5    The form of this Warrant need not be changed because of any
change in the Purchase Price pursuant to SECTION 5 and any Warrant issued after
such change may state the same Purchase Price and the same number of shares of
Common Stock as are stated in this Warrant.

              5.6    If the Company shall take a record of the holders of the
Common Stock for the purpose of entitling them to receive a dividend or other
distribution payable in Common Stock, Options or Convertible Securities or to
subscribe for or purchase Common Stock, Options or Convertible Securities, then
such record date shall be deemed to be the date of the issue, sale, distribution
or grant of the shares of Common Stock deemed to have been issued or sold upon
the declaration of such dividend or the making of such other distribution or the
date of the granting of such right of subscription or purchase, as the case may
be.

              5.7.   If any event occurs as to which the foregoing provisions of
this Section 5 are not strictly applicable or, if strictly applicable, would
not, in the good faith judgment of the Board of Directors of the Company, fairly
protect the purchase rights of the Warrrants in accordance with the essential
intent and principles of such provisions, then such Board shall make such
adjustments in the application of such provisions, in accordance with such
essential intent and principles as shall be reasonably necessary, in the good
faith opinion of such Board, to protect such purchase rights as aforesaid, but
in no event shall any such adjustment have the effect of increasing the Purchase
Price or decreasing the number of shares of Common Stock subject to purchase
upon exercise of this Warrant, or otherwise adversely affect the Warrantholders.

              5.8    As a condition precedent to the taking of any action which
would require an adjustment pursuant to this Section 5, the Company shall take
any action which may be necessary, including obtaining regulatory approvals or
exemptions, in order that the Company may thereafter validly and legally issue
as fully paid and nonassessable all shares of Common Stock which the holders of
Warrants are entitled to receive upon exercise thereof.

              5.9    Each holder of this Warrant may, at its option, be entitled
to receive, in lieu of the adjustment pursuant to Section 5.1(c) or otherwise
required as a result of any distribution of the type referenced in Section
5.1(c), on the date of exercise of the Warrants, the Other Securities, evidences
of indebtedness or assets or purchase rights, options or warrants to

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subscribe for or purchase such Other Securities which such Warrantholder would
have been entitled to receive if it had exercised its Warrants for share of
Common Stock immediately prior to the record date with respect to such
distribution. Subject to the other provisions and restrictions of this Warrant
with respect to the exercise rights of the holder of this Warrant, each holder
of this Warrant may exercise its option under this subsection 5.9 by delivering
to the Company a written notice of such exercise within 7 days of its receipt of
the notice required pursuant to Section 5.4 to be delivered by the Company in
connection with such distribution.

       6.     OTHER NOTICES; ADJUSTMENT FOR REORGANIZATION, CONSOLIDATION,
MERGER, ETC.:

              If at any time:

              (a)    the Company shall propose to declare any cash dividend upon
its [Shares];

              (b)    the Company shall propose to declare or make any dividend
or other distribution to the holders of its Common Stock, whether in cash,
property or other securities;

              (c)    the Company shall propose to effect any reorganization or
reclassification of the capital stock of the Company or any consolidation or
merger of the Company with or into another corporation or any sale, lease or
conveyance of all or substantially all of the assets of the Company; or

              (d)    the Company shall propose to effect a voluntary or
involuntary dissolution, liquidation or winding-up of the Company;

then, in any one or more of said cases, the Company shall give to the holder of
this Warrant (i) at least 20 days' prior written notice of the date on which the
books of the Company shall close or a record shall be taken for such dividend or
distribution or for determining rights to vote in respect of any such
reorganization, reclassification, consolidation, merger, sale, lease,
conveyance, dissolution, liquidation or winding-up, and (ii) in the case of any
such reorganization, reclassification, consolidation, merger, sale, lease,
conveyance, dissolution, liquidation or winding-up, at least 20 days' written
notice of the date when the same shall take place. Upon receipt of a notice of
an event described in clauses (a) through (d), the holder of this Warrant may,
at its option, exercise this Warrant in whole or in part. Upon the occurrence of
an event described in clause (c), the holder of this Warrant shall be entitled
thereafter to receive upon exercise of this Warrant the kind and amount of
shares of stock or other securities or assets which the holder would have been
entitled to receive after the occurrence of such event had this Warrant been
exercised immediately prior to such event; and in any such case, appropriate
provision shall be made with respect to the rights and interests of the holder
to the end that the provisions of this Warrant (including, without limitation,
provisions with respect to changes in and adjustments of the Purchase Price and
the number of shares purchasable upon the exercise of

12
<PAGE>


this Warrant) shall thereafter be applicable, as nearly as may be, in relation
to any shares of stock, or other securities or assets, thereafter deliverable
upon the exercise of this Warrant. The Company will not effect any of the
transactions described in clause (c) above unless, prior to the consummation
thereof, each person (other than the Company) that may be required to deliver
any cash, stock, securities or other assets upon the exercise of this Warrant as
provided herein shall assume, by written instrument delivered to the holder of
this Warrant, (x) the obligations of the Company under this Warrant (and if the
Company shall survive the consummation of any such transaction, such assumption
shall be in addition to, and shall not release the Company from, any continuing
obligations of the Company under this Warrant) and (y) the obligation to deliver
to such holder such cash, stock, securities or other assets as such holder may
be entitled to receive in accordance with the provisions of SECTIONS 5 AND 6.
The provisions of this SECTION 6 shall similarly apply to successive
transactions.

              6.1    DISSOLUTION. Except as otherwise expressly provided in
SECTION 6.1, in the event of any dissolution of the Company following the
transfer of all or substantially all of its properties or assets, the Company,
prior to such dissolution, shall at its expense deliver or cause to be delivered
the stock and other securities and property (including cash, where applicable)
receivable by the holder of this Warrant after the effective date of such
dissolution pursuant to this SECTION 6 to a bank or trust company having its
principal office in the State of New York or the State of Delaware, as trustee
for the holder of this Warrant.

              6.2    CONTINUATION OF TERMS. Except as otherwise expressly
provided in SECTION 6.1, upon any reorganization, consolidation, merger or
transfer (and any dissolution following any transfer) referred to in this
SECTION 6, this Warrant shall continue in full force and effect and the terms
hereof shall be applicable to the shares of stock and other securities and
property receivable on the exercise of this Warrant after the consummation of
such reorganization, consolidation or merger or the effective date of
dissolution following any such transfer, as the case may be, and shall be
binding upon the issuer of any such stock or other securities, including, in the
case of any such transfer, the person acquiring all or substantially all of the
properties or assets of the Company.

       7.     NO IMPAIRMENT. The Company will not, by amendment of its
certificate of incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
action, avoid or seek to avoid the observance or performance of any of the terms
of this Warrant to be observed or performed by it, 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
holder of this Warrant against impairment. Without limiting the generality of
the foregoing, the Company (a) will not increase the par value of any shares of
stock receivable on the exercise of this Warrant, or permit such par value to
be, above the amount payable therefor on such exercise, (b) will at all times
reserve and keep available out of its authorized capital stock, solely for the
purpose of

13
<PAGE>


issue upon exercise of this Warrant as herein provided, such number of shares of
Common Stock and Other Securities as shall then be issuable upon exercise of
this Warrant in full and shall take all such action as may be necessary or
appropriate in order that all shares of Common Stock and Other Securities that
shall be so issuable shall be duly and validly issued and fully paid and
nonassessable and free from all taxes, liens and charges with respect to the
issue thereof, (c) will not effect a subdivision or split up of shares or
similar transaction with respect to any class of the Common Stock without
effecting an equivalent transaction with respect to all other classes of Common
Stock, and (d) will not issue any capital stock of any class which is preferred
as to dividends or as to the distribution of assets upon voluntary or
involuntary dissolution, liquidation or winding up, unless the rights of the
holders thereof shall be limited to a fixed sum or percentage of par value in
respect of participation in dividends and in any such distribution of assets.

       8.     EXCHANGE OF WARRANTS. On surrender for exchange of this Warrant,
properly endorsed, to the Company, the Company at its expense will issue and
deliver to or (subject to SECTION 2) on the order of the holder thereof a new
Warrant or Warrants of like tenor, in the name of such holder or as such holder
(on payment by such holder or any applicable transfer taxes) may direct, calling
in the aggregate on the face or faces thereof for the number of shares of Common
Stock called for on the face or faces of this Warrant so surrendered.

       9.     REPLACEMENT OF WARRANTS. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
Warrant, on 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 Warrant, the Company will, at
the expense of the holder hereof, execute and deliver, in lieu thereof, a new
Warrant of like tenor.

       10.    STAMP AND TRANSFER TAXES, ETC. The holder hereof agrees to pay any
and all stamp, transfer and other similar taxes payable or determined to be
payable in connection with the original issuance of this Warrant.

       11.    WARRANT AGENT. The Company may, by written notice to the holder of
this Warrant, appoint an agent having an office in New York, New York, for the
purpose of issuing Shares on the exercise of this Warrant pursuant to SECTION 3,
exchanging this Warrant pursuant to SECTION 8, and replacing this Warrant
pursuant to SECTION 9, or any of the foregoing, and thereafter any such
issuance, exchange or replacement, as the case may be, shall be made at such
office by such agent.

       12.    INCIDENTAL REGISTRATION. If the Company at any time proposes to
file on its behalf and/or on behalf of any of its security holders ("THE
DEMANDING SECURITY HOLDERS") a registration statement under the Securities Act
on any form (other than a registration statement on Form S-4

14
<PAGE>


or S-8 or any successor form for securities to be offered in a transaction of
the type referred to in Rule 145 under the Securities Act or to employees of the
Company pursuant to any employee benefit plan, respectively) for the general
registration of securities to be sold for cash with respect to its Common Stock
or any other class of equity security (as defined in Section 3(a)(11) of the
Exchange Act) of the Company, it will give written notice to all holders of
Registrable Securities at least 60 days before the initial filing with the
Commission of such registration statement, which notice shall set forth the
intended method of disposition of the securities proposed to be registered by
the Company. The notice shall offer to include in such filing the aggregate
number of shares of Registrable Securities as such holders may request. Each
holder of any such Registrable Securities desiring to have Registrable
Securities registered under this SECTION 12 (each a "REGISTERING HOLDER") shall
advise the Company in writing within thirty (30) days after the date of receipt
of such notice from the Company, setting forth the amount of such Registrable
Securities for which registration is requested. The Company shall thereupon
include in such filing the number of shares of Registrable Securities for which
registration is so requested, subject to the next sentence, and shall use its
best efforts to effect registration under the Securities Act of such shares. If
the managing underwriter of a proposed public offering shall advise the Company
in writing that, in its opinion, the distribution of the Registrable Securities
requested to be included in the registration concurrently with the securities
being registered by the Company or such demanding security holder would
materially and adversely affect the distribution of such securities by the
Company or such demanding security holder, then the Company and the demanding
security holders and the registering holders (collectively, "SELLING SECURITY
HOLDERS") shall reduce the amount of securities each intended to distribute
through such offering on a pro rata basis.

       13.    REGISTRATION PROCEDURES. If the Company is required by the
provisions of SECTION 12 to use its best efforts to effect the registration of
any of its securities under the Securities Act, the Company will, as
expeditiously as possible:

       (a)    prepare and file with the Commission a registration statement with
              respect to such securities and use its best efforts to cause such
              registration statement to become and remain effective for a period
              of time required for the disposition of such securities by the
              holders thereof, but not to exceed 180 days; PROVIDED THAT before
              filing such registration statement, the Company will furnish to
              the selling security holders copies of all such documents proposed
              to be filed;

       (b)    prepare and file with the Commission such amendments and
              supplements to such registration statement and the prospectus used
              in connection therewith as may be necessary to keep such
              registration statement effective and to comply with the provisions
              of the Securities Act with respect to the sale or other
              disposition of all securities covered by such registration
              statement until the earlier of such time as all of such securities
              have been disposed of in a public offering or the expiration

15
<PAGE>


              of 180 days; PROVIDED THAT before filing such amendments and
              supplements, the Company will furnish to the selling security
              holders copies of all such documents proposed to be filed;

       (c)    furnish to all selling security holders such number of copies of
              the registration statement (together, with all such amendments
              thereto) and the summary or each other prospectus, including each
              preliminary prospectus, in conformity with the requirements of the
              Securities Act, and such other documents, as such selling security
              holders may reasonably request;

       (d)    use its best efforts to register or qualify the securities covered
              by such registration statement under such other securities or blue
              sky laws of such jurisdictions within the United States and Puerto
              Rico as each holder of such securities shall request (PROVIDED,
              HOWEVER, that the Company shall not be obligated to qualify as a
              foreign corporation to do business under the laws of any
              jurisdiction in which it is not then qualified or to file any
              general consent to service or process), and do such other
              reasonable acts and things as may be required of it to enable such
              holder to consummate the disposition in such jurisdiction of the
              securities covered by such registration statement;

       (e)    notify each holder of Registrable Securities covered by such
              registration statement at any time when a prospectus relating
              thereto is required to be delivered under the Securities Act of
              the happening of any event as a result of which the prospectus
              included in such registration statement, as then in effect,
              includes an untrue statement of a material fact or omits to state
              a material fact required to be stated therein or necessary to make
              the statements therein not misleading in the light of the
              circumstances then existing;

       (f)    notify each holder of Registrable Securities covered by such
              registration statement and such holder's underwriters, if any, and
              confirm such advice in writing: (i) when the registration
              statement has become effective, (ii) when any post-effective
              amendment to the registration statement becomes effective and
              (iii) of any request by the Commission for any amendment or
              supplement to the registration statement or prospectus or for
              additional information;

       (g)    notify each holder of Registrable Securities if at any time the
              Commission should institute or threaten to institute any
              proceedings for the purpose of issuing, or should issue, a stop
              order suspending the effectiveness of the registration statement.
              Upon the occurrence of any of the events mentioned in the
              preceding sentence, the Company will use diligent efforts to
              prevent the issuance of any such stop order or to obtain the
              withdrawal thereof as soon as possible. The Company will advise
              each holder of Registrable Securities promptly of any order

16
<PAGE>


              or communication of any public board or body addressed to the
              Company suspending or threatening to suspend the qualification of
              any Registrable Securities for sale in any jurisdiction;

       (h)    enter into customary agreements (including an underwriting
              agreement in customary form) and take such other actions as are
              reasonably required in order to expedite or facilitate the
              disposition of such Registrable Securities; and

       (i)    otherwise use its best efforts to comply with all applicable rules
              and regulations of the Commission, and make available to its
              security holders (as understood under Rule 158 of the Securities
              Act), as soon as reasonably practicable, but not later than
              sixteen (16) months after the effective date of the registration
              statement, an earning statement covering the period of at least
              twelve (12) months beginning with the first full month after the
              effective date of such registration statement, which earnings
              statements shall satisfy the provisions of Section 11(a) of the
              Securities Act.

              It shall be a condition precedent to the obligation of the Company
to take any action pursuant to this Warrant in respect of the securities which
are to be registered at the request of any holder of Registrable Securities that
such holder shall furnish to the Company such information regarding the
securities held by such holder and the intended method of disposition thereof as
the Company shall reasonably request and as shall be required in connection with
the action taken by the Company. If any registration statement or comparable
statement under the Securities Act refers to any registering holder or any of
its affiliates, by name or otherwise, as the holder of any securities of the
Company then, unless counsel to the Company advises the Company that the
Securities Act requires that such reference be included in any such statement,
each such holder shall have the right to require the deletion of such reference
to itself and its affiliates.

       14.    REGISTRATION EXPENSES. All expenses incurred in complying with
SECTIONS 12 AND 13 of this Warrant, including, without limitation, all
registration and filing fees (including all expenses incident to filing with the
NASD), printing expenses, fees and disbursements of counsel for the Company, the
reasonable fees and expenses of counsel for the selling security holders
(selected by those holding a majority of the shares being registered), expenses
of any special audits incident to or required by any such registration and
expenses of complying with the securities or blue sky laws of any jurisdictions
pursuant to SECTION 13(D), shall be paid by the Company, except that:

       (a)    all such expenses in connection with any amendment or supplement
to the registration statement or prospectus filed more than 180 days after the
effective date of such registration statement solely because any holder of
Registrable Securities has not effected the disposition of the securities
requested to be registered shall be paid by such holder; and

17
<PAGE>


       (b)    the Company shall not be liable for any fees, discounts or
commissions to any underwriter or any fees or disbursements of counsel for any
underwriter in respect of the securities sold by such holder of Registrable
Securities.

       15.    INDEMNIFICATION AND CONTRIBUTION.

       (a)    In the event of any registration of an Registrable Securities
              under the Securities Act pursuant to this Warrant, the Company
              shall indemnify and hold harmless the holder of such Registrable
              Securities, such holder's directors and officers, and each other
              Person (including each underwriter) who participated in the
              offering of such Registrable Securities and each other Person, if
              any, who controls such holder or such participating Person within
              the meaning of the Securities Act, against any losses, claims,
              damages or liabilities, joint or several, to which such holder or
              any such director or officer or participating Person or
              controlling Person may become subject under the Securities Act or
              any other statute or at common law, insofar as such losses,
              claims, damages or liabilities (or actions in respect thereof)
              arise out of or are based upon (i) any alleged untrue statement of
              any material fact contained, on the effective date thereof, in any
              registration statement under which such securities were registered
              under the Securities Act, any preliminary prospectus or final
              prospectus contained therein, or any amendment or supplement
              thereto, or (ii) any alleged omission to state therein a material
              fact required to be stated therein or necessary to make the
              statements therein not misleading in the light of the
              circumstances under which they were made, and shall reimburse such
              holder or such director, officer or participating Person or
              controlling Person for any legal or any other expenses reasonably
              incurred by such holder or such director, officer or participating
              Person or controlling Person in connection with investigating or
              defending any such loss, claim, damage, liability or action;
              PROVIDED, HOWEVER, that the Company shall not be liable in any
              such case to the extent that any such loss, claim, damage or
              liability arises out of or is based upon any alleged untrue
              statement or alleged omission made in such registration statement,
              preliminary prospectus, prospectus or amendment or supplement in
              reliance upon and in conformity with written information furnished
              to the Company by such holder specifically for use therein. Such
              indemnity shall remain in full force and effect regardless of any
              investigation made by or on behalf of such holder or such
              director, officer or participating Person or controlling Person,
              and shall survive the transfer of such securities by such holder.

18
<PAGE>


       (b)    Each holder of any Registrable Securities, by acceptance thereof,
              agrees to indemnify and hold harmless the Company, its directors
              and officers and each other Person, if any, who controls the
              Company within the meaning of the Securities Act against any
              losses, claims, damages or liabilities, joint or several, to which
              the Company or any such director or officer or any such Person may
              become subject under the Securities Act or any other statute or at
              common law, insofar as such losses, claims, damages or liabilities
              (or actions in respect thereof) arise out of or are based upon
              information in writing provided to the Company by such holder of
              such Registrable Securities specifically for use in the following
              documents and contained, on the effective date thereof, in any
              registration statement under which securities were registered
              under the Securities Act at the request of such holder, any
              preliminary prospectus or final prospectus contained therein, or
              any amendment or supplement thereto.

       (c)    If the indemnification provided for in this SECTION 15 from the
              indemnifying party is unavailable to an indemnified party
              hereunder in respect of any losses, claims, damages, liabilities
              or expenses referred to therein, then the indemnifying party, in
              lieu of indemnifying such indemnified party, shall contribute to
              the amount paid or payable by such indemnified party as a result
              of such losses, claims, damages, liabilities or expenses in such
              proportion as is appropriate to reflect the relative fault of the
              indemnifying party and indemnified parties in connection with the
              actions which resulted in such losses, claims, damages,
              liabilities or expenses, as well as any other relevant equitable
              considerations. The relative fault of such indemnifying party and
              indemnified parties shall be determined by reference to, among
              other things, whether any action in question, including any untrue
              or alleged untrue statement of a material fact or omission or
              alleged omission to state a material fact, has been made by, or
              relates to information supplied by, such indemnifying party or
              indemnified parties, and the parties' relative intent, knowledge,
              access to information and opportunity to correct or prevent such
              action. The amount paid or payable by a party as a result of the
              losses, claims, damages, liabilities and expenses referred to
              above shall be deemed to include any legal or other fees or
              expenses reasonably incurred by such party in connection with any
              investigation or proceeding.

              The parties hereto agree that it would not be just and equitable
if contribution pursuant to this SECTION 15(c) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
No Person guilty of fraudulent misrepresentation (within the

19
<PAGE>


meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation.

       16.    NO INCONSISTENT AGREEMENTS. The Company will not hereafter enter
into any agreement with respect to its securities which is inconsistent with the
rights granted to the holders of Registrable Securities in this Warrant. The
Company has not previously entered into any agreement with respect to any of its
securities granting any registration rights to any Person, other than
registration rights granted in respect of this Warrant, the Shares and those
agreements set forth on SCHEDULE 16 annexed hereto.

       17.    NEGOTIABILITY, ETC. This Warrant is issued upon the following
terms, to all of which the holder hereof by the taking hereof consents and
agrees:

                     (a)    subject to the transfer restrictions herein, title
              to this Warrant may be transferred by endorsement (by the holder
              hereof executing the form of assignment at the end hereof) and
              delivery in the same manner as in the case of a negotiable
              instrument transferable by endorsement and delivery;

                     (b)    subject to the transfer restrictions herein, any
              person in possession of this Warrant properly endorsed is
              authorized to represent himself as absolute owner hereof and is
              empowered to transfer absolute title hereto by endorsement and
              delivery hereof to a bona fide purchaser hereof for value; each
              prior taker or owner waives and renounces all of his equities or
              rights in this Warrant in favor of each such bona fide purchaser,
              and each such bona fide purchaser shall acquire absolute title
              hereto and to all rights represented hereby; and

                     (c)    until this Warrant is transferred on the books of
              the Company, the Company may treat the registered holder hereof as
              the absolute owner hereof for all purposes, notwithstanding any
              notice to the contrary.

       18.    NO VOTING RIGHTS; LIMITATION OF LIABILITY. Nothing contained in
this Warrant shall be construed as conferring upon the holder hereof the right
to vote or to consent or to receive notice as a stockholder in respect of
meetings of stockholders for the election of directors of the Company or any
other matters or any rights whatsoever as a stockholder of the Company. No
provisions hereof, in the absence of affirmative action by the holder to
purchase shares of Common Stock, and no mere enumeration herein of the rights or
privileges of the holder hereof, shall give rise to any liability of such holder
for the Purchase Price or as a shareholder of the Company whether such liability
is asserted by the Company or by its creditors.

       19.    NOTICES. Except as otherwise provided herein, whenever it is
provided herein that any notice, demand, request, consent, approval, declaration
or other communication shall or may be given to or served upon any of the
parties by another, or whenever any of the parties desires to

20
<PAGE>


give or serve upon another any communication with respect to this Warrant, each
such notice, demand, request, consent, approval, declaration or other
communication shall be in writing and shall be deemed given only if (i)
delivered in person, or (ii) sent by Federal Express or nationally recognized
overnight courier service, and addressed as follows:

              1.     If to the holder of this Warrant, at its address as shown
on the books of the Company

              with a copy to:

                     Proskauer Rose LLP
                     1585 Broadway
                     New York, New York 10036
                     Attn:  Ira Akselrad, Esq.

              2.     If to Company, at:

                     DVL, Inc.
                     70 East 55th Street, 7th Floor
                     New York, NY 10022
                     Attn:  President

or at such other address as may be substituted by notice given as herein
provided. The giving of any notice required hereunder may be waived in writing
by the party entitled to receive such notice. Every notice, demand, request,
consent, approval, declaration or other communication hereunder shall be deemed
effective upon receipt.

       20.    MISCELLANEOUS. This 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. This Warrant is being delivered in the State of New York and shall be
construed and enforced in accordance with and governed by its laws. The headings
in this Warrant are for purposes of reference only, and shall not limit or
otherwise affect any of the terms hereof. This Warrant is being executed as an
instrument under seal. All nouns and pronouns used herein shall be deemed to
refer to the masculine, feminine or neuter, as the identity of the person or
persons to whom reference is made herein may require.




                           [INTENTIONALLY LEFT BLANK]

21
<PAGE>




22
<PAGE>


       21.    EXPIRATION. The right to exercise this Warrant shall expire at
5:00 P.M., New York time, on February 15, 2011.

Dated: As of February 15, 2001                DVL, INC., A DELAWARE CORPORATION


(Corporate Seal)                              By:____________________________
                                              Name:
                                              Title:


23
<PAGE>


                              FORM OF SUBSCRIPTION

(To be signed only upon exercise of Warrant)

To: ___________________________


              The undersigned, the holder of the within Warrant, hereby
irrevocably elects to exercise the purchase right represented by such Warrant
for, and to purchase thereunder, _____________________ (_______) shares of
Common Stock, par value $0.01 per share (the "Stock"), of DVL, Inc. (the
"Company") and herewith makes payment of _____________________________ Dollars
($__________) therefor and requests that the certificates for such shares be
issued in the name of, and delivered to, _______________________________________
______________________________________________________, whose address is
____________________________________________.

              The undersigned represents, unless the exercise of this Warrant
has been registered under the Securities Act of 1933, as amended (the
"Securities Act"), that the undersigned is acquiring such Stock for his own
account for investment and not with a view to or for sale in connection with any
distribution thereof (except for any resale pursuant to a registration statement
under the Securities Act).



DATED: _______________


                                        ----------------------------------------
                                        (Signature must conform in all respects
                                        to name of holder as specified on the
                                        face of the Warrant)



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


                                        ----------------------------------------
                                                        (Address)

24
<PAGE>




25
<PAGE>


                                   SCHEDULE 16


                            Other Registration Rights
                               Previously Granted
                                 by the Company



                      Warrants issued to NPM Capital, LLC
                and certain employees and directors of DVL, Inc.



26