THIS WARRANT AND THE COMMON SHARES  ISSUABLE UPON EXERCISE  HEREOF HAVE NOT BEEN
REGISTERED  UNDER THE  SECURITIES  ACT OF 1933,  AS  AMENDED,  AND  NEITHER  THE
SECURITIES  NOR ANY  INTEREST  THEREIN  MAY BE  SOLD,  TRANSFERRED,  PLEDGED  OR
OTHERWISE  DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION UNDER
SUCH  ACT AND  THE  RULES  AND  REGULATIONS  THEREUNDER.  THE  TRANSFER  OF SUCH
SECURITIES IS SUBJECT TO THE  RESTRICTIONS  SET FORTH HEREIN AND SUCH SECURITIES
MAY BE  TRANSFERRED  ONLY IN  COMPLIANCE  WITH THE TERMS AND  CONDITIONS OF THIS
WARRANT.


Warrant No. PGOA 1                                               June 22, 1999



                                    WARRANT

                    TO PURCHASE SHARES OF COMMON STOCK OF

                               AJAY SPORTS, INC.


Void after 5:00 p.m. (Central Time) June 22, 2001  50,000 Shares of Common Stock


      THIS IS TO CERTIFY that for value received,  ROBERT SAGE, or his permitted
registered  assigns, is entitled upon the due exercise hereof at any time during
the Exercise Period (as hereinafter  defined) to purchase,  in whole or in part,
from AJAY SPORTS, INC., a Delaware corporation, fifty thousand (50,000) (subject
to adjustment  as provided  herein)  shares of common stock,  par value $.01 per
share ("Common Shares"), at the exercise price of $2.00 per Common Share if this
Warrant is exercised  on or before June 22,  2000,  or $2.50 per Common Share if
this  Warrant  exercised  after June 22,  2000  ("Exercise  Price")  (subject to
adjustment  as provided  herein) for each such Common Share so purchased  and to
exercise the other rights, powers and privileges  hereinafter  provided,  all on
the terms and conditions and pursuant to the provisions hereinafter set forth.

                                   ARTICLE II
                                   DEFINITIONS

      The terms defined in this Article I, whenever used in this Warrant,  shall
have  the  respective  meanings  hereinafter  specified.  Whenever  used in this
Warrant,  any noun or pronoun  shall be deemed to include  both the singular and
plural and to cover all genders.


<PAGE>






THIS WARRANT AND THE COMMON SHARES  ISSUABLE UPON EXERCISE  HEREOF HAVE NOT BEEN
REGISTERED  UNDER THE  SECURITIES  ACT OF 1933,  AS  AMENDED,  AND  NEITHER  THE
SECURITIES  NOR ANY  INTEREST  THEREIN  MAY BE  SOLD,  TRANSFERRED,  PLEDGED  OR
OTHERWISE  DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION UNDER
SUCH  ACT AND  THE  RULES  AND  REGULATIONS  THEREUNDER.  THE  TRANSFER  OF SUCH
SECURITIES IS SUBJECT TO THE  RESTRICTIONS  SET FORTH HEREIN AND SUCH SECURITIES
MAY BE  TRANSFERRED  ONLY IN  COMPLIANCE  WITH THE TERMS AND  CONDITIONS OF THIS
WARRANT.


Warrant No. PGOA 2                                               June 22, 1999



                                    WARRANT

                    TO PURCHASE SHARES OF COMMON STOCK OF

                               AJAY SPORTS, INC.


Void after 5:00 p.m. (Central Time) June 22, 2001  50,000 Shares of Common Stock


      THIS IS TO CERTIFY  that for value  received,  THE JACK  LONDON  REVOCABLE
LIVING  TRUST or its  permitted  registered  assigns,  is entitled  upon the due
exercise hereof at any time during the Exercise Period (as hereinafter  defined)
to  purchase,  in  whole  or  in  part,  from  AJAY  SPORTS,  INC.,  a  Delaware
corporation,  fifty thousand (50,000) (subject to adjustment as provided herein)
shares of common  stock,  par value  $.01 per share  ("Common  Shares"),  at the
exercise  price of $2.00 per Common  Share if this  Warrant is  exercised  on or
before June 22, 2000, or $2.50 per Common Share if this Warrant  exercised after
June 22, 2000 ("Exercise  Price") (subject to adjustment as provided herein) for
each such Common Share so purchased and to exercise the other rights, powers and
privileges hereinafter provided, all on the terms and conditions and pursuant to
the provisions hereinafter set forth.

                                   ARTICLE II
                                   DEFINITIONS

      The terms defined in this Article I, whenever used in this Warrant,  shall
have  the  respective  meanings  hereinafter  specified.  Whenever  used in this
Warrant,  any noun or pronoun  shall be deemed to include  both the singular and
plural and to cover all genders.



<PAGE>







      "Assignment" means the form of Assignment appearing at the end of this
Warrant.

      "Closing Date" means June 22, 1999.

      "Commission"  means the Securities and Exchange  Commission,  or any other
federal agency then administering the Securities Act.

      "Common Shares" means the Company's authorized shares of common stock, par
value $.01 per share.

      "Company" means Ajay Sports, Inc., a Delaware corporation, and any
successor entity.

      "Current Market Price" per Common Share on any date herein specified means
the  average of the daily  market  prices  (determined  as set forth in the next
sentence),  if any, for five (5) consecutive business days immediately preceding
such date.  The market price for each such  business day shall be the average of
the last sale prices on such day on all  domestic  stock  exchanges on which the
Common Shares may then be listed,  or, if no sale takes place on such day on any
such  exchange,  the average of the closing bid and asked  prices on such day as
officially quoted on such exchanges, or, if Common Shares are not then listed or
admitted to trading on any domestic  stock  exchange,  the market price for each
business  day shall be the last sale  price on such day on the  Nasdaq  National
Market,  or, if no sale takes place on such day on the Nasdaq  National  Market,
the average of the  closing bid and asked  prices on such day as reported by the
National  Association of Securities  Dealers,  Inc., or if Common Shares are not
then listed or admitted for trading on the Nasdaq  National  Market,  the market
price for each  business  day shall be the average of the reported bid and asked
prices on such day in the over-the-counter  market, as furnished by the National
Quotation  Bureau,  Inc.,  or,  if such firm at the time is not  engaged  in the
business of reporting such prices, as furnished by any similar firm then engaged
in such business and selected by the Company or, if there is no such firm or the
Common  Shares are not then traded in the  over-the-counter  market,  the market
price shall be such value as is reasonably  determined by the Board of Directors
of the Company.

      "Exchange Act" means the Securities Exchange Act of 1934, as amended,  and
any similar or successor  federal statute,  and the rules and regulations of the
Commission  (or its  successor)  thereunder,  all as the same shall be in effect
from time to time.

      "Exercise  Period" means the period  commencing  on the Closing Date,  and
terminating at 5:00 p.m., Central time, on June 22, 2001.

      "Exercise  Price"  means the price per Common Share set forth in the first
paragraph of the first page of this Warrant,  as such price may be adjusted from
time to time pursuant to Article IV.

      "Holder"  means the person in whose name this Warrant is registered on the
books of the Company maintained for such purpose.


<PAGE>



      "Investor  Representation  Certificate"  means  a  certificate  as to  the
accuracy,  at and as of the  time  of  exercise  of  this  Warrant,  of  certain
representations  and warranties of the Holder set forth in form appearing at the
end of this Warrant.


      "Nasdaq" means The National Association of Securities Dealers, Inc.
Automated Quotation System.

      "Notice of Exercise" means the form of Notice of Exercise appearing at
the end of this Warrant.

      "Securities  Act" means the  Securities  Act of 1933,  as amended,  or any
similar  federal  statute,  and the  rules  and  regulations  of the  Commission
promulgated thereunder, all as the same shall be in effect from time to time.

      "Transfer"   means  any  offer,   sale,   gift,   disposition,   attempted
disposition,   liquidating  distribution,  dividend  or  distribution  in  kind,
transfer, assignment,  delivery, pledge, hypothecation, of any present or future
interest,  right,  claim or privilege in or to this Warrant or the Common Shares
issuable upon exercise of this Warrant, as the case may be.

      "Warrant"  means (a) this  warrant  dated as of the Closing Date issued to
the person or legal entity named on the first page of this Warrant;  and (b) all
warrants  issued  upon the  partial  exercise,  transfer  or  division  of or in
substitution for such warrant.


                                   ARTICLE III
                               EXERCISE OF WARRANT

      III.1  Right  to  Exercise.  Subject  to  and  upon  compliance  with  the
conditions  of this Article II, the Holder shall have the right,  at its option,
at any time and from time to time during the Exercise  Period,  to exercise this
Warrant in whole or in part.

      Notice of Exercise;  Issuance of Common Shares.  To exercise this Warrant,
the Holder  shall  deliver to the Company at its  administrative  office at 7001
Orchard Lake Road,  Suite 424, West  Bloomfield,  Michigan 48322 (a) a Notice of
Exercise duly executed by the Holder and  specifying the number of Common Shares
to be purchased, (b) a completed and signed Investor Representation Certificate,
(c) an amount equal to the aggregate  Exercise Price for all Common Shares as to
which this Warrant is then being exercised and (d) this Warrant.



<PAGE>



      Payment of the Exercise  Price shall be made, at the option of the Holder,
(i) by wire  transfer  to an  account in a bank  located  in the  United  States
designated for such purpose by the Company or (ii) by certified or official bank
check  payable to the order of the  Company and drawn on a member of the Chicago
or New York Clearing House. Upon receipt thereof, the Company shall, as promptly
as practicable, and in any event within five business days thereafter, provide a
letter  of  instructions  to  the  Company's   transfer  agent  authorizing  and
instructing the transfer agent to cause to be issued and delivered to the Holder
a certificate or certificates  representing  the aggregate number of full Common
Shares issuable upon such exercise registered in the name of the Holder.


      Unless otherwise  requested by the Holder, this Warrant shall be deemed to
have been exercised and such certificate or certificates shall be deemed to have
been issued,  and the Holder shall be deemed to have become the holder of record
of such  shares for all  purposes  as of the close of  business  on the date the
Notice of  Exercise,  together  with the  Investor  Representation  Certificate,
payment as herein provided and this Warrant, are received by the Company.

      If this Warrant is exercised in part,  the Company  shall,  at the time of
delivery of the instruction  letter to the Company's  transfer agent authorizing
the issuance of the certificate or certificates  for Common Shares,  unless this
Warrant  has then  expired,  issue  and  deliver  to the  Holder  a new  Warrant
evidencing  the rights of the Holder to purchase the aggregate  number of Common
Shares for which this Warrant  shall not have been  exercised,  and this Warrant
shall be cancelled.

      Fractional Shares. The Company shall not issue fractional Common Shares or
scrip  representing  fractional Common Shares upon any exercise of this Warrant.
As to any fractional  Common Shares which the Holder would otherwise be entitled
to purchase from the Company upon such exercise, the Company shall purchase from
the Holder such  fractional  share at a price equal to an amount  calculated  by
multiplying such fractional share (calculated to the nearest 1/100th of a share)
by its  Current  Market  Price on the date the Notice of Exercise is received by
the Company. Payment of such amount shall be made in cash or by check payable to
the  order  of the  Holder  at the  time  of  delivery  of  any  certificate  or
certificates arising upon such exercise.

                                   ARTICLE IV
                       REGISTRATION, TRANSFER AND EXCHANGE

      The Company shall keep at its principal  office referred to in Section 2.2
a register in which, subject to such reasonable regulations as it may prescribe,
the Company  shall provide for the  registration,  Transfer and exchange of this
Warrant.  The  Company  will  not at any  time,  except  upon  the  dissolution,
liquidation or winding up of the Company, close such register so as to result in
preventing or delaying the exercise or permitted Transfer of this Warrant.

      Every Warrant  presented or surrendered  for  registration  of a permitted
Transfer or exchange shall be accompanied by an Assignment  duly executed by the
holder thereof or its attorney duly authorized in writing.



<PAGE>



      All Warrants  issued upon any  registration  of any permitted  Transfer or
exchange of Warrants shall be the valid  obligations of the Company,  evidencing
the same rights,  and entitled to the same benefits as the Warrants  surrendered
upon such registration of permitted Transfer or exchange.


      Upon  receipt  by the  Company  of  evidence  satisfactory  to it (in  the
exercise of  reasonable  discretion)  of the  ownership of and the loss,  theft,
destruction  or  mutilation  of this  Warrant  and (in  case of  loss,  theft or
destruction)  the  written  agreement  of the Holder to  indemnify  the  Company
against any resulting loss or expense, or (in case of mutilation) upon surrender
and cancellation  hereof,  the Company will execute and deliver in lieu hereof a
replacement Warrant.

      No service  charge  shall be made for any  registration  of any  permitted
Transfer or exchange of Warrants.

      The  Company  and any agent of the  Company  may treat the person in whose
name this  Warrant is  registered  as the owner of this Warrant for all purposes
whatsoever,  and  neither  the  Company  nor any agent of the  Company  shall be
affected by notice to the contrary.


                                    ARTICLE V
                              ADJUSTMENT PROVISIONS

      Splits and  Combinations.  In case the Company shall at any time subdivide
its  outstanding  Common  Shares into a greater  number of shares,  the Exercise
Price in effect  immediately prior to such subdivision shall be  proportionately
reduced,  and, conversely,  in case the outstanding Common Shares of the Company
shall be combined into a smaller number of shares,  the Exercise Price in effect
immediately prior to such combination shall be proportionately increased.

      Reorganization,  Reclassification  or Recapitalization of Company. In case
of any capital  reorganization or  reclassification  or  recapitalization of the
capital  stock of the  Company  (other  than a change in par value,  or from par
value to no par  value  or from no par  value  to par  value)  or in case of the
consolidation  or merger of the Company with or into another  corporation  or in
case of the sale or  transfer  of the  property of the Company as an entirety or
substantially  as an entirety,  there shall  thereafter be deliverable  upon the
exercise of this Warrant or any portion thereof (in lieu of the number of Common
Shares  theretofore   deliverable)  the  number  of  shares  of  capital  stock,
beneficial  interest or other  securities  or property to which the Holder would
have been  entitled  upon such capital  reorganization  or  reclassification  of
capital stock, consolidation, merger or sale had it fully exercised this Warrant
immediately prior thereto, and at the same aggregate Exercise Price.



<PAGE>



      Adjustment  of Number of Shares  Purchasable.  Upon any  adjustment of the
Exercise  Price as provided in this  Article,  the Holder  shall  thereafter  be
entitled to purchase, at the Exercise Price resulting from such adjustment,  the
number of Common Shares  (calculated to the nearest 1/l00th of a share) obtained
by multiplying the Exercise Price in effect immediately prior to such adjustment
by the number of Common Shares purchasable  hereunder  immediately prior to such
adjustment and dividing the product thereof by the Exercise Price resulting from
such adjustment.



                                   ARTICLE VI
                        RESERVATION OF SHARES ISSUABLE ON
                     EXERCISE OF WARRANT; PREEMPTIVE RIGHTS


      The  Company  will at all times  reserve  and keep  available,  solely for
issuance,  sale and  delivery  upon the  exercise of this  Warrant,  a number of
Common  Shares  equal to the  number of full  Common  Shares  issuable  upon the
exercise of this Warrant.  All Common Shares  issuable upon the exercise of this
Warrant  shall,  when  issued,  (a) be duly and validly  issued,  fully paid and
nonassessable, and (b) be free from all taxes, liens and charges with respect to
the issue thereof other than any stock transfer taxes in respect of any transfer
occurring  contemporaneously  with such issue. No stockholder of the Company has
or shall have any preemptive rights to subscribe for such Common Shares.


                                   ARTICLE VII
                            RESTRICTIONS ON TRANSFER

      Reference in this Article VI to Common  Shares  issuable upon the exercise
of the Warrants shall include Common Shares theretofore issued upon the exercise
of any Warrants  that are then  evidenced by  certificates  required to bear the
legend set forth in Section 6.2.

      VII.1 Notice of Proposed Transfer; Registration Not Required. This Warrant
may be Transferred by the Holder only (a) with the express prior written consent
of the  Company,  which  consent may be withheld in the sole  discretion  of the
Company for any reason;  and (b) in compliance with this Article VI in whole (as
to all Common Shares purchasable hereunder) but not in part.



<PAGE>



      The Holder or the holder of any Common  Shares  issuable upon the exercise
hereof,  by acceptance  hereof or thereof,  agrees to give written notice to the
Company,  prior to any  Transfer  of this  Warrant,  such  Common  Shares or any
portion  hereof or thereof,  of its intention to make such transfer which notice
shall  include a brief  description  of such proposed  Transfer.  If the Company
consents to the transfer  and if, in the opinion of counsel to the Company,  the
proposed  Transfer may be effected without  registration or qualification  under
any federal or state law, such counsel shall, as promptly as practicable, notify
the  Company  and the Holder in writing of such  consent  and opinion and of the
terms and  conditions,  if any, to be observed in such  Transfer,  whereupon the
Holder  shall be  entitled  to Transfer  this  Warrant or such Common  Shares in
accordance with the terms of the notice delivered to the Company,  the Company's
written consent to the Transfer and the opinion of such counsel,  subject to the
restrictions on Transfer set forth in this Article VI. Any Transfer or purported
Transfer not in  compliance  with this Section 6.1 shall be null and void and of
no effect.


      Legend on  Certificates.  In case any Common  Shares  are issued  upon the
exercise in whole or in part of this Warrant or are thereafter  Transferred,  in
either case under such  circumstances  that no registration under the Securities
Act is required,  each  certificate  representing  such shares shall bear on the
face thereof the following legend:

      The shares  represented by this certificate have not been registered under
      the Securities Act of 1933, as amended, or the securities or blue sky laws
      of any state,  and any  transfer  thereof  is  subject  to the  conditions
      specified in the Warrant dated as June 22, 1999 originally  issued by Ajay
      Sports,  Inc. (the  "Company") to Robert W. Sage to purchase Common Shares
      of the  Company.  A copy of the form of such  Warrant  is on file with the
      Secretary  of the  Company  and will be  furnished  without  charge by the
      Company  to the holder of this  certificate  upon  written  request to the
      Secretary of the Company at such address.

      In the event that (a) a  registration  statement  covering  Common  Shares
represented  by  a  certificate  bearing  the  legend  specified  above  becomes
effective under the Securities Act or (b) the Company receives an opinion of its
counsel that such legend is no longer  necessary on such  certificate to protect
the Company from a violation of the Securities  Act, the Company shall, or shall
instruct  its  transfer  agent and  registrar  to,  issue in lieu  thereof a new
certificate  or  certificates  for such shares in the name of the holder of such
shares without such legend on the face thereof.

      Supplying  Information.  The Company, the Holder and each holder of Common
Shares  issuable  upon the exercise  hereof shall  cooperate  with each other in
supplying  such  information  as may be  necessary  for any of such  parties  to
complete  and  file any  information  reporting  forms  presently  or  hereafter
required by the Commission or any commissioner or other authority  administering
the blue sky or securities laws of any U.S. jurisdiction where Common Shares are
proposed to be sold pursuant to Article VI.

      Compliance  With Rule 144. For as long as the Company's  Common Shares are
registered  under  Section 12 of the  Exchange  Act, at the request of Holder if
Holder  proposes to sell any of the Common Shares  issuable upon the exercise of
this Warrant in compliance with Rule 144 of the Commission, or any similar Rule,
assuming that at such time the  provisions  of such Rule are  applicable to such
Holder and, in the event the Holder is or could be deemed an  "affiliate" of the
Company,  and the Company is then  required to file reports  under Section 13 or
15(d) of the Exchange  Act, the Company  shall make such filings of reports with
the  Commission  as will enable the Holder to make sales of Common Shares issued
upon exercise hereof pursuant to such Rule.




<PAGE>



                                  ARTICLE VIII

                                  MISCELLANEOUS

      Holder  Not A  Stockholder.  Prior  to the  exercise  of this  Warrant  as
hereinbefore  provided, the Holder shall not be entitled to any of the rights of
a  stockholder  of the Company  including,  without  limitation,  the right as a
stockholder  to (a) vote or consent,  or (b) receive (i)  dividends or any other
distributions  made to stockholders,  (ii) notice of, or attend, any meetings of
stockholders  of the  Company or (iii)  notice of any other  proceedings  of the
Company (except as provided in Articles IV and VI).

      Notice  Generally.  Any notice,  demand or delivery to be made pursuant to
the  provisions of this Warrant shall be  sufficiently  given or made if sent by
telecopy or by registered or certified mail (return receipt requested),  postage
prepaid,  addressed  to (a) the Holder at its last known  address  and  telecopy
number appearing on the books of the Company  maintained for such purpose or (b)
the Company at its principal office referred to in Section 2.2 (facsimile number
248-851-9080). The Holder and the Company may each designate a different address
by notice to the other pursuant to this Section 7.2

      Successors and Assigns. This Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the  successors  of the Company and,
subject to Article VI, the Holder and the Holder's permitted assigns.

      Amendment.  This Warrant may not be modified or amended except by
written agreement of the parties.

      Headings.  The headings of the Articles and Sections of this Warrant
are for the convenience of reference only and shall not, for any purpose, be
deemed a part of this Warrant.

      Governing Law.  This Warrant shall be governed by the laws of the State
of Delaware.

Dated as of June 22, 1999

ATTEST:                                   AJAY SPORTS, INC.
                                          a Delaware corporation


By/s/ Robert R. Hebard                    By/s/ Thomas W. Itin
------------------------------            ----------------------------
   Robert R. Hebard, Secretary               Thomas W. Itin, President




<PAGE>






                            NOTICE OF EXERCISE FORM

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


     The  undersigned  registered  Holder  of  the  within  Warrant  irrevocably
exercises  the within  Warrant for and  purchases  Common Shares of Ajay Sports,
Inc. and herewith tenders payment therefor in the amount of $ , all at the price
and on the terms and  conditions  specified  in the within  Warrant and requests
that a certificate (or  certificates in  denominations of shares) for the Common
Shares  of Ajay  Sports,  Inc.  hereby  purchased  be  issued in the name of and
delivered to the  undersigned,  and if such Common  Shares shall not include all
the Common Shares issuable as provided in the within Warrant, that a new Warrant
of like tenor for the number of Common  Shares of Ajay  Sports,  Inc.  not being
purchased hereunder be issued in the name of and delivered to the undersigned.

Dated: _____________________

Signature Guaranteed:                     By:
                                              (Signature of Registered Holder)

                                    Address:



By:
    Title:



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

            The   signature  to  this  Notice  of  Exercise  must  be  medallion
            guaranteed  by a  commercial  bank or trust  company  in the  United
            States or a member firm of the New York Stock Exchange.


<PAGE>



                                ASSIGNMENT FORM


                   (To be executed upon a Permitted Transfer
                            of the within Warrant)


     FOR VALUE RECEIVED the undersigned  registered Holder of the within Warrant
hereby sells, assigns and transfers unto , whose address is all of the rights of
the undersigned under the within Warrant,  with respect to all the Common Shares
issuable as provided in the Warrant, and does hereby irrevocably  constitute and
appoint  Attorney to register  such  transfer on the books of Ajay Sports,  Inc.
maintained for the purpose, with full power of substitution in the premises.

Dated ______________________

Signature Guaranteed:                     By:
                                              (Signature of Registered Holder)




By:
    Title:



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

            The signature to this Assignment  must be medallion  guaranteed by a
            commercial  bank or trust  company in the United  States or a member
            firm of the New York Stock Exchange.


<PAGE>







                       INVESTOR REPRESENTATION CERTIFICATE

      In connection  with the  undersigned  investor's  exercise of that certain
Warrant to Purchase Shares of Common Stock of Ajay Sports, Inc. (the "Company"),
the   undersigned   investor   hereby  makes  the   following   acknowledgments,
representations and warranties to the Company:

      1. He understands and acknowledges that none of the shares of common stock
of the Company issuable upon exercise of the Warrant (the "Warrant Shares") have
been  registered  under the  Securities  Act of 1933 (the  "Securities  Act") or
registered or qualified  under the securities  laws of any state and none may be
offered, sold, contracted for sale, transferred, or otherwise disposed of absent
an effective  registration  thereof under such  Securities  Act or an opinion of
counsel,  which opinion is reasonably  satisfactory in form and substance to the
Company and its counsel,  to the effect that such  registration  is not required
under  the  Securities  Act or  applicable  state  securities  laws or that such
transaction  complies with the rules  promulgated by the Securities and Exchange
Commission  (the  "Commission")  under the  Securities  Act or applicable  state
securities laws.  Investor  understands that the Company has no obligation,  and
does not intend to register the Conversion  Shares under  applicable  federal or
state  securities  laws  and  that he  must  bear  the  economic  risks  of this
investment resulting from such limitations.

      2.  Investor  is an  "accredited  investor"  within  the  meaning  of  the
Securities Act based upon the following (check all that apply):

      (a)___ he is a natural  person whose  individual  net worth,  or joint net
worth with his spouse, at the time of purchase exceeds  $1,000,000,  at the time
of exercise; or

      (b) he is a  natural  person  who had an  individual  income  in excess of
$200,000 in each of the two most recent years or joint income with that person's
spouse in excess of $300,000 in each of those  years and  reasonably  expects to
reach the same income level in the current year; or

      (c)  it  is  a  private  business  development  company  as  defined  in
section 202(a)(22) of the Investment Advisors Act of 1940; or

      (d)  it is  either  (i) a  bank  as  defined  in  section  3(a)(2)  of the
Securities Act of 1933 (the "Act"),  or a savings and loan  association or other
institution  as defined in section  3(a)(5)(A) of the Act whether  acting in its
individual or fiduciary capacity; (ii) a broker or dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934; (iii) an insurance company as
defined in Section 2(13) of the Act; (iv) an investment company registered under
the Investment Company Act of 1940 or a business  development company as defined
in  section  2(a)(48)  of that  Act;  (v) a Small  Business  Investment  Company
licensed by the U.S. Small Business  Administration  under Section 301(c) or (d)
of the Small Business  Investment Act of 1958; or (vi) an employee  benefit plan
within the meaning of Title I of the Employee  Retirement Income Security Act of
1974,  if the  investment  decision is made by a plan  fiduciary,  as defined in
section 3(21) of such Act, which is either a bank, savings and loan association,
insurance company, or registered  investment adviser, or if the employee benefit
plan has total assets in excess of $5,000,000 or, if a self-directed  plan, with
investment decisions made solely by persons that are Accredited Investors; or


<PAGE>



(5) it is any corporation, Massachusetts or similar business trust, partnership,
or organization described in section 501(c)(3) of the Internal Revenue Code, not
formed for the specific purpose of acquiring the securities offered,  with total
assets in excess of $5,000,000; or


(6) ___ it is any trust,  with total assets in excess of $5,000,000,  not formed
for the specific purpose of acquiring the securities offered,  whose purchase is
directed by a sophisticated person as described in Regulation  230.506(b)(2)(ii)
promulgated under the Act;

(7) it is a trust with respect to which the  grantor(s)  has  retained  absolute
power in his or her sole discretion to amend or revoke the trust at any time and
such  grantor(s)  is an  accredited  investor as indicated in items 2(a) or 2(b)
above; or

(8) it is an entity in which all of its  equity  owners  meet one or more of the
standards set forth in the preceding  paragraphs number 2(c) through 2(f), based
upon the questionnaires delivered by such equity owners.

3.  Investor has had access to all periodic  reports and other  documents  filed
with the  Securities  and  Exchange  Commission  by the Company  pursuant to the
Company's  obligation  to file such  reports  imposed  under  Section  15 of the
Securities  Exchange  Act of 1934.  Investor has  undertaken  such review of the
Company and its business and financial  position as Investor deemed necessary in
order to make a decision to  exercise  his  Warrant.  Investor  understands  the
various risks of an  investment in the Warrant  Shares and he can afford to bear
the risks of an investment in the Warrant  Shares,  including the risk of losing
all or substantially all of the exercise price therefor.

4. Investor is acquiring its Warrant  Shares for his own account,  as principal,
and not with a view to the resale or  distribution  of all or any portion of the
Warrant Shares.

5.  Investor has not relied upon the Company or any of its directors or officers
for tax, legal or investment or financial advice,  but rather has relied only on
his own advisers with respect to  evaluating  the risks and merits of exercising
the Warrant to purchase the Warrant Shares.

6. Investor  hereby agrees to  indemnify,  defend and hold the Company  harmless
from  and  against  any  and  all  loss,  cost,  damage,  liability  or  expense
(including,  without  limitation,  reasonable  attorneys  fees,  court costs and
reasonable  litigation expenses) which the Company may suffer,  sustain or incur
as a result from,  arising  under or in  connection  with any  inaccuracy of any
representation  or  acknowledgment  or failure of performance of any warranty by
Investor hereunder.

                                    INVESTOR


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