Exhibit 4.1

         THIS  WARRANT  AND ANY  WARRANT  SHARES  ISSUED  UPON  EXERCISE OF THIS
WARRANT ARE SUBJECT TO A SECURITIES PURCHASE AGREEMENT,  DATED AS OF JANUARY 18,
2005,  AS  AMENDED,  A COPY OF WHICH IS ON FILE AT THE  PRINCIPAL  OFFICE OF THE
COMPANY AND WILL BE FURNISHED  TO THE HOLDER ON REQUEST TO THE  SECRETARY OF THE
COMPANY.  SUCH SECURITIES PURCHASE AGREEMENT  PROVIDES,  AMONG OTHER THINGS, FOR
CERTAIN  RESTRICTIONS  ON  DISPOSITION  OF  THE  SECURITIES  EVIDENCED  BY  THIS
CERTIFICATE.

         THIS  WARRANT,  THE PURCHASE  RIGHTS  EVIDENCED BY THIS WARRANT AND ANY
WARRANT  SHARES WHICH MAY BE ISSUED UPON  EXERCISE OF THIS WARRANT HAVE NOT BEEN
REGISTERED  PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED (THE  "SECURITIES
ACT"), OR ANY STATE  SECURITIES LAW, AND THIS WARRANT,  SUCH PURCHASE RIGHTS AND
WARRANT SHARES MAY NOT BE SOLD,  TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THE
SAME ARE REGISTERED AND QUALIFIED IN ACCORDANCE  WITH THE SECURITIES ACT AND ANY
APPLICABLE  STATE  SECURITIES  LAWS,  OR IN THE  OPINION OF  COUNSEL  REASONABLY
SATISFACTORY  TO  THE  COMPANY  SUCH  REGISTRATION  AND  QUALIFICATION  ARE  NOT
REQUIRED.


No. __ Warrant to Purchase

                                                 _______ shares of Common Stock
Dated:   March 1, 2005
                                                         (subject to adjustment
                                                           as described herein)

                               WARRANT CERTIFICATE

                   Representing Common Stock Purchase Warrant

                              AMEN PROPERTIES, INC.

Purchase Price of Common Stock:                            $4.00 per share

                                                   (subject to adjustment)

         THIS WARRANT  CERTIFICATE  (THIS  "WARRANT")  CERTIFIES that, for value
received,  _________________________________,  his  registered  assigns  or  the
Holder (as defined below) hereof, is entitled, at any time prior to the close of
business on the Expiration  Date defined below, to purchase the number of shares
stated above (subject to adjustment as herein  provided) of Common Stock of Amen
Properties,  Inc., a Delaware corporation (the "COMPANY"), at the purchase price
per share stated above (subject to adjustment as herein provided) (the "PURCHASE
PRICE") upon  surrender of this Warrant at the  Principal  Office of the Company
and payment of such  Purchase  Price in cash or by bank  cashier's  or certified
check.



                                        1
<PAGE>



         This Warrant is one of the Warrants  originally  issued by the Company,
initially covering an aggregate of 250,000 shares of Common Stock, pursuant to a
Securities  Purchase  Agreement dated as of January 18, 2005 between the Company
and the  purchasers  named on the signature  pages  thereto,  as amended by that
certain First Amendment to Securities Purchase Agreement dated as of January 28,
2005 and that certain Second Amendment to Securities Purchase Agreement dated as
of February 28, 2005 (the "PURCHASE AGREEMENT").

         SECTION 1. DEFINITIONS.  The  following  terms  have  the  meanings set
forth  below.  Additional  terms are defined elsewhere herein.

         "COMMON STOCK" means the Common Stock, par value $.01 per share, of the
Company.

         "EXERCISE  DATE" with  respect to any Warrant  means each date on which
Warrant Shares are to be issued upon exercise of such Warrant.

         "EXPIRATION DATE" means March 1, 2008.

         "HOLDER" means the registered holder or holders of this Warrant and any
related Warrant Shares.

         "HOLDERS" means the registered  holders of all Warrants and any related
Warrant Shares.

         "PRINCIPAL  OFFICE" means the principal office of the Company which, on
the date hereof,  is located at 303 West Wall, Suite 1700,  Midland Texas 79701.
The Company  shall  notify  each  Warrantholder  of any change in its  principal
office.

         "PURCHASE  PRICE"  has  the  meaning  assigned  to  that  term  in  the
introductory paragraph hereof.

         "PURCHASERS"  means all of the  initial  Holders  of the  Warrants  who
purchased the Warrants from the Company.

         "SECURITIES ACT" means the Securities Act of 1933, as amended.

         "SERIES C PREFERRED  STOCK"  means the Series C  Convertible  Preferred
Stock, par value $.001 per share, of the Company.

         "WARRANTS" means the Company's  Common Stock Purchase  Warrants and any
Warrant Certificates representing such Common Stock Purchase Warrants (including
the Warrant  represented  by this Warrant  Certificate)  issued  pursuant to the
Purchase  Agreement,  each  identical  as to the  terms and  conditions  of this
Warrant  Certificate except as to the number of shares of Common Stock for which
they may be  exercised,  evidencing,  in the  aggregate,  the right to  purchase
initially  250,000  shares of Common  Stock,  all  Warrants  issued in exchange,
transfer or replacement thereof.

         "WARRANT  SHARES"  means  the  shares  of  Common  Stock  purchased  or
purchasable by the Holder upon the exercise of this Warrant  pursuant to Section
2 hereof,  and,  where the  context  so  requires,  the  shares of Common  Stock
issuable upon exercise of any other Warrant by the Holder thereof.

                                       2
<PAGE>

Any  capitalized  term not  otherwise  defined  herein  shall  have the  meaning
specified in the Purchase Agreement.

SECTION 2.          EXERCISE.
                    --------

         A. GENERAL.  Subject to the  limitation set forth in Section 2E and any
other  limitation  set forth herein or in the  Purchase  Agreement or imposed by
applicable  law,  each Holder  shall be entitled to exercise any Warrant held by
it, in whole or in part, at any time or from time to time commencing on the date
of  issuance  of the  Warrant  until  5:00 p.m.,  Midland,  Texas  time,  on the
Expiration Date.

         B. MANNER OF EXERCISE.  In order to exercise any Warrant in whole or in
part, the Holder shall complete one of the  subscription  forms attached hereto,
deliver the Warrant to the Company at its  Principal  Office and make payment of
the  Purchase  Price  pursuant  to one of the payment  options  provided in this
Section 2.B.  Payment of the  Purchase  Price shall be made at the option of the
Holder by one or more of the following  methods:  (1) by delivery to the Company
of cash, a certified  check or a bank cashier's  check in an amount equal to the
then aggregate  Purchase  Price,  (2) by  instructing  the Company to withhold a
number of Warrant Shares then issuable upon exercise of the  particular  Warrant
with an aggregate  Fair Market Value (as defined  below) equal to such  Purchase
Price, or (3) by  surrendering to the Company shares of Common Stock  previously
acquired  by the  Holder  with an  aggregate  Fair  Market  Value  equal to such
Purchase Price, or any combination of the foregoing. Upon receipt thereof by the
Company,  the Holder shall immediately be deemed to be a holder of record of the
shares of Common Stock  specified  in said  subscription  form,  and the Company
shall,  as promptly as  practicable,  and in any event  within 10 business  days
thereafter,  execute  and  deliver  or cause  to be  delivered  to the  Holder a
certificate  or  certificates  representing  the  aggregate  number of shares of
Common Stock  specified in said  subscription  form.  Each stock  certificate so
delivered  shall be  registered in the name of such Holder or such other name as
shall be designated by such Holder, subject to compliance with federal and state
securities  laws and Section 4 hereof.  If the Warrant shall have been exercised
only in  part,  the  Company  shall,  at the  time  of  delivery  of said  stock
certificate or certificates, deliver to the Holder a Warrant in the form of this
Warrant  representing  the  right to  purchase  the  remaining  number of shares
purchasable  thereunder.  The Company  shall pay all  expenses,  taxes and other
charges  payable in connection with the  preparation,  execution and delivery of
stock  certificates  pursuant to this Section 2, except that, in case such stock
certificates  shall be  registered in a name or names other than the name of the
Holder,  funds sufficient to pay all stock transfer taxes which shall be payable
upon the execution and delivery of such stock certificate or certificates  shall
be paid by the Holder to the  Company at the time of  delivering  the Warrant to
the Company.  As used herein  "FAIR MARKET  VALUE" on any day shall mean (i) the
average  of the daily  closing  sale  prices of the Common  Stock  during the 20
trading days  immediately  preceding  the day as of which "FAIR MARKET VALUE" is
being determined, on the principal securities exchange on which the Common Stock
is then listed, or if there shall have been no sales of the Common Stock on such
exchange  on such day,  the mean of the  closing  bid and  asked  prices on such
exchange at the end of such day,  or (ii) if the Common  Stock is not so listed,
the  average  of the  high  and low bid and  prices  on such  day in a  domestic
over-the-counter market, or (iii) any time the Common Stock is not listed on any
domestic  exchange or quoted in a domestic  over-the-counter  market,  the "FAIR
MARKET VALUE" shall be determined by the Board of Directors of the Company.

                                       3
<PAGE>

         C. TRANSFER RESTRICTION LEGEND. Each Warrant shall bear the legends set
forth on the face of this Warrant.  Each  certificate  for Warrant Shares issued
upon exercise or  conversion of this Warrant,  unless at the time of exercise or
conversion  such Warrant Shares are registered  under the Securities  Act, shall
bear the legends described in Section 5.9 of the Purchase Agreement.

         D.  CHARACTER OF WARRANT  SHARES.  All shares of Common Stock  issuable
upon the  exercise of the Warrants  shall be duly  authorized,  validly  issued,
fully paid and nonassessable.

         E.  LIMITATION ON EXERCISE.  Notwithstanding  anything stated herein to
the  contrary,  unless and until the issuance and sale of the Series C Preferred
Stock and the  Warrants  are  approved or ratified  by the  stockholders  of the
Company  in  accordance   with  the  rules  of  the  Nasdaq  Stock  Market  (the
"STOCKHOLDER APPROVAL"), the Series C Preferred Stock and the Warrants cannot be
converted into or exercised for (as the case may be) a total number of shares of
Common  Stock  equal to or greater  than twenty  percent  (20%) of the number of
shares of Common  Stock  outstanding  immediately  prior to the  issuance of the
Series C Preferred Stock and the Warrants (the "COMMON STOCK CAP"). The exercise
of the Warrants is  expressly  limited by and subject to this Section 2E for all
purposes  unless and until the  Stockholder  Approval  is  obtained.  Within the
Common Stock Cap, the exercise  rights of the Warrants are  subordinated  to the
conversion  rights of the Series C Preferred Stock,  such that no Warrant may be
exercised  if the number of shares of Common  Stock  into which the  outstanding
shares of Series C Preferred  Stock are  convertible  is equal to or exceeds the
Common Stock Cap. In the event the Common Stock Cap exceeds the number of shares
of Common Stock  issuable upon  conversion  of the Series C Preferred  Stock but
less  than the  number of shares of  Common  Stock  into  which the  outstanding
Warrants are  exercisable,  the exercise  right of the Warrants shall be reduced
pro rata among the outstanding  Warrants.  In no event shall the total number of
shares of Common  Stock into which the Series C Preferred  Stock is  convertible
and the  Warrants  are  exercisable  exceed  the  Common  Stock Cap prior to the
Stockholder  Approval.  Upon  Stockholder  Approval,  the Common Stock Cap shall
terminate and the Warrants  shall be  exercisable  in accordance  with the terms
hereof excluding this Section 2E.

SECTION 3.          OWNERSHIP AND EXCHANGE OF THE WARRANTS.
                    --------------------------------------

         A.  REGISTERED  HOLDER.  The  Company  may deem and treat the person in
whose  name  each  Warrant  is  registered  as  the  Holder  and  owner  thereof
(notwithstanding  any  notations of ownership or writing  thereon made by anyone
other than the Company) for all purposes and shall not be affected by any notice
to the contrary,  until presentation of such Warrant for exchange or transfer as
provided in this Section 3.

         B.  EXCHANGE  AND  REPLACEMENT.  Any Warrant is  exchangeable  upon the
surrender thereof by the Holder to the Company at its Principal Office for a new
Warrant or Warrants of like tenor and date  representing  in the  aggregate  the
right to purchase the number of shares purchasable thereunder,  each new Warrant
to represent  the right to purchase such number of shares as shall be designated
by the Holder at the time of surrender.  Subject to  compliance  with Section 4,
each Warrant and all rights thereunder are transferable in whole or in part upon
the books of the Company by the Holder  thereof in person or by duly  authorized
attorney,  and a new Warrant shall be made and delivered by the Company,  of the
same  class,  tenor and date as the Warrant  but  registered  in the name of the
transferee,  upon  surrender of the Warrant,  duly  endorsed,  at the  Principal
Office of the Company.  The Company will issue replacement Warrant  certificates
upon the loss,  theft,  destruction  or mutilation  thereof.  Warrants  shall be
promptly  canceled by the Company upon the surrender  thereof in connection with
any exchange, transfer or replacement. The Company shall pay all expenses, taxes
(other than stock transfer  taxes) and other charges  payable in connection with
the preparation, execution and delivery of Warrants pursuant to this Section 3.

                                       4
<PAGE>

         SECTION 4. TRANSFER OF WARRANTS OR WARRANT SHARES. This Warrant and the
related Warrant Shares shall not be  transferable  except in accordance with the
terms and conditions  specified in the Purchase Agreement and in accordance with
applicable law.

         SECTION 5.  ADJUSTMENT  PROVISIONS.  The aggregate  number of shares of
Common Stock issuable upon exercise of the Warrants,  and the Purchase Price per
share,  shall be subject to adjustment in the events and to the extent set forth
in EXHIBIT I.

         SECTION 6.  NOTIFICATIONS BY THE COMPANY.  The Holder shall be entitled
to notices of certain  events  related to the  Company to the same extent and in
the same manner as the holders of the Series C Preferred  Stock  pursuant to the
terms of the Certificate of Designations of the Series C Preferred Stock.

         SECTION 7. NOTICES.  Any notice or other document required or permitted
to be given or delivered to Holders  shall be delivered at, or sent by certified
or  registered  mail to each Holder at, the address set forth for such Holder on
the signature  page hereof or to such other address as shall have been furnished
to the Company in writing by such Holder.  Any notice or other document required
or permitted to be given or delivered to the Company  shall be sent by certified
or  registered  mail  to  the  Company,  at  its  Principal  Office,  attention:
President,  or other such address as shall have been furnished to the Holders by
the Company.

         SECTION 8. NO RIGHTS AS  STOCKHOLDER;  LIMITATION  OF  LIABILITY.  This
Warrant  shall  not  entitle  any  Holder  thereof  to any of  the  rights  of a
stockholder of the Company.  No provision  hereof, in the absence of affirmative
action by the Holder to  purchase  shares of Common  Stock,  and no  enumeration
herein of the rights or privileges  of the Holder of a Warrant,  shall give rise
to any liability of such Holder for the Purchase  Price or as a  stockholder  of
the Company,  whether such  liability is asserted by the Company or by creditors
of the Company.

         SECTION  9.  MISCELLANEOUS.  This  Warrant  shall be  governed  by, and
construed  and enforced in accordance  with,  the laws of the State of Delaware.
This Warrant and any  provision  hereof may be changed,  waived,  discharged  or
terminated  only  by an  instrument  in  writing  signed  by the  party  (or any
predecessor  in  interest  thereof)  against  which  enforcement  of the same is
sought.  The headings in this  Warrant are for  purposes of  reference  only and
shall not affect the meaning or construction of any of the provisions hereof.




                                       5
<PAGE>




         WITNESS the due execution of this Warrant by a duly authorized  officer
of the Company.

                              AMEN PROPERTIES, INC.,
                              a Delaware corporation


                              By: /s/  Jon M. Morgan
                                 -----------------------------------
                                       Jon M. Morgan, President



ATTEST:



Secretary


ACCEPTED this 1st day of March, 2005:



Name:
     ---------------------------------------
Address:
         -----------------------------------





                                       6
<PAGE>




                             FULL SUBSCRIPTION FORM


                  ____ To Be Executed by the Registered Holder
                  if He Desires to Exercise the Warrant in Full

         The undersigned  hereby  exercises the right to purchase the __________
shares of Common  Stock  covered  by the  attached  Warrant  at the date of this
subscription and herewith makes payment of the sum of $____________ representing
the  Purchase  Price of  $______________  per  share  in  effect  at this  date.
Certificates for such shares shall be issued in the name of and delivered to the
undersigned,  unless otherwise  specified in written  instructions signed by the
undersigned and accompanying this subscription.


Dated: _________, ____      [                                            ]


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

                            Address:
                                     -------------------------------------


                                       7
<PAGE>




                            PARTIAL SUBSCRIPTION FORM


                   ___ To Be Executed by the Registered Holder
                  if He Desires to Exercise the Warrant in Part


         The  undersigned  hereby  exercises  the right to  purchase  __________
shares of the total  number of shares of Common  Stock  covered by the  attached
Warrant at the date of this  subscription  and herewith makes payment of the sum
of $__________ representing the Purchase Price of __________ per share in effect
at this date.  Certificates  for such shares and a new Warrant of like tenor and
date for the  balance of the shares  not  subscribed  for shall be issued in the
name of and delivered to the undersigned,  unless otherwise specified in written
instructions signed by the undersigned and accompanying this subscription.

         (THE  FOLLOWING  PARAGRAPH NEED BE COMPLETED ONLY IF THE PURCHASE PRICE
AND NUMBER OF SHARES OF COMMON STOCK SPECIFIED IN THE ATTACHED WARRANT HAVE BEEN
ADJUSTED PURSUANT TO EXHIBIT I THEREOF.)

         The shares hereby subscribed for constitute __________ shares of Common
Stock  (rounded  to the  nearest  whole  share)  resulting  from  adjustment  of
______________  shares of the total of  _______________  shares of Common  Stock
covered by the attached Warrant,  as said shares were constituted at the date of
the  Warrant,  leaving  a  balance  of  ________  shares  of  Common  Stock,  as
constituted at the date of the Warrant, to be covered by the new Warrant.


Dated:  _________,____      [                                               ]

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

                            Address:
                                     ----------------------------------------






                                       8
<PAGE>


                                    EXHIBIT I

                            ANTI-DILUTION PROVISIONS


         The number of Warrant  Shares  purchasable  upon the  exercise  of this
Warrant and the Purchase Price shall be subject to adjustment  from time to time
upon the happening of certain events as hereinafter described. Capitalized terms
used but not defined  herein  shall have the  meanings  assigned  thereto in the
Warrant.

         1. SPECIAL  DEFINITIONS.  For purposes of this EXHIBIT I, the following
definitions shall apply:

                  (A)  "OPTION"  shall  mean  rights,  options  or  warrants  to
         subscribe   for,   purchase  or  otherwise   acquire  Common  Stock  or
         Convertible Securities,  excluding rights, options or shares granted or
         issued to employees,  vendors,  officers,  directors and executives of,
         and  consultants  or  shareholders  to,  the  Company  in an amount not
         exceeding the number of Reserved Employee Shares.

                  (B) "ORIGINAL ISSUE DATE" shall mean the date of this Warrant.

                  (C)  "CONVERTIBLE  SECURITIES"  shall  mean any  evidences  of
         indebtedness,   shares  or  other  securities  directly  or  indirectly
         convertible  into or  exchangeable  for  Common  Stock,  except for the
         Series C Preferred Stock issued on the Original Issue Date.

                  (D) "ADDITIONAL  SHARES OF COMMON STOCK" shall mean all shares
         of Common Stock issued (or,  pursuant to Section 3 below,  deemed to be
         issued)  by the  Company  after the  Original  Issue  Date,  other than
         Reserved  Employee  Shares and other than shares of Common Stock issued
         or issuable:

                           (1) by  reason  of a  stock  dividend,  stock  split,
                  split-up or other distribution on shares of Common Stock;

                           (2) upon the exercise of Options;

                           (3) upon  conversion  of shares of Series C Preferred
                  Stock;

                  (E)  "RESERVED  EMPLOYEE  SHARES"  shall mean shares of Common
         Stock  issued  to  employees,  officers,  directors,  shareholders  and
         executives  of, and  consultants  or vendors  to,  the  Company  either
         directly as compensation or upon the exercise of options granted by the
         Company.

                  (F) "RIGHTS TO ACQUIRE COMMON STOCK" (or "RIGHTS")  shall mean
         all rights  issued by the Company to acquire  Common  Stock  whether by
         exercise of a warrant,  option or similar  call,  or  conversion of any
         existing instruments, in either case for consideration fixed, in amount
         or by formula, as of the date of issuance.

                                      I-1
<PAGE>

         2. NO ADJUSTMENT OF CONVERSION  PRICES.  No adjustment in the number of
Warrant Shares shall be made (i) unless the  consideration per share (determined
pursuant to Section 5 below) for an  Additional  Share of Common Stock issued or
deemed to be issued by the Company is less than the Purchase  Price in effect on
the date of, and immediately  prior to, the issue of such  Additional  Shares of
Common Stock, or (ii) if prior to such issuance,  the Company  receives  written
consent  from the holders of at least a majority of the voting power of all then
outstanding  Warrants  agreeing  that no such  adjustment  shall  be made as the
result of the issuance of Additional Shares of Common Stock.

         3. ISSUE OF  SECURITIES  DEEMED  ISSUE OF  ADDITIONAL  SHARES OF COMMON
STOCK.  If the Company at any time or from time to time after the Original Issue
Date shall  issue any  Options or  Convertible  Securities  or Rights to Acquire
Common Stock, then the maximum number of shares of Common Stock (as set forth in
the  instrument  relating  thereto  without  regard to any  provision  contained
therein for a subsequent  adjustment of such number)  issuable upon the exercise
of  such  Options,  Rights  or,  in the  case  of  Convertible  Securities,  the
conversion  or exchange of such  Convertible  Securities,  shall be deemed to be
Additional Shares of Common Stock issued as of the time of such issue; provided,
however, that Additional Shares of Common Stock shall not be deemed to have been
issued  unless the  consideration  per share  (determined  pursuant to Section 5
hereof)  of such  Additional  Shares  of  Common  Stock  would be less  than the
Purchase Price in effect on the date of and immediately  prior to such issue, or
such record date,  as the case may be, and provided,  further,  that in any such
case:

                  (A) No further  adjustment in the Purchase Price shall be made
         upon the  subsequent  issue of shares of Common Stock upon the exercise
         of such Options,  Rights or conversion or exchange of such  Convertible
         Securities;

                  (B) Upon the  expiration  or  termination  of any  unexercised
         Option,  Right or  Convertible  Security,  the Purchase  Price shall be
         adjusted  immediately  to reflect the  Purchase  Price which would have
         been in effect had such Option,  Right or Convertible  Security (to the
         extent outstanding immediately prior to such expiration or termination)
         never been issued; and

                  (C) In the  event of any  change  in the  number  of shares of
         Common Stock issuable upon the exercise,  conversion or exchange of any
         Option, Right or Convertible Security, including, but not limited to, a
         change  resulting  from  the  anti-dilution   provisions  thereof,  the
         Purchase  Price then in effect shall  forthwith be  readjusted  to such
         Purchase  Price as would  have been  obtained  had the  Purchase  Price
         adjustment  that was originally  made upon the issuance of such Option,
         Right or  Convertible  Security  which were not  exercised or converted
         prior to such  change been made upon the basis of such  change,  but no
         further  adjustment  shall be made for the  actual  issuance  of Common
         Stock upon the  exercise or  conversion  of any such  Option,  Right or
         Convertible Security.

         4. ADJUSTMENT OF CONVERSION  PRICES UPON ISSUANCE OF ADDITIONAL  SHARES
OF COMMON STOCK.  If the Company shall at any time after the Original Issue Date
issue Additional  Shares of Common Stock (including  Additional Shares of Common
Stock deemed to be issued pursuant to Section 3, but excluding  shares issued as
a dividend  or  distribution  as  provided in Section 7 or upon a stock split or
combination  as  provided  in  Section  6),  without  consideration,  or  for  a
consideration  per share less than the  Purchase  Price in effect on the date of
and  immediately   prior  to  such  issue,  or  without  the  requisite  consent
contemplated  by Section 2 hereof,  then and in such event,  the Purchase  Price
shall be reduced by a full ratchet anti-dilution adjustment to such lesser price
(calculated  to the nearest  cent),  but in no case will the  Purchase  Price be
reduced below $2.80 per share,  concurrently  with such issuance at a price less
than the original Purchase Price.  Notwithstanding the foregoing, the applicable
Purchase Price shall not be reduced if the amount of such reduction  would be an
amount  less  than  $.20,  but any such  amount  shall be  carried  forward  and
reduction  with  respect  thereto  made at the  time of and  together  with  any
subsequent  reduction  which,  together with such amount and any other amount or
amounts so carried forward, shall aggregate $.20 or more.

                                      I-2
<PAGE>

         5. DETERMINATION OF CONSIDERATION.  For purposes of this Exhibit I, the
consideration  received by the Company for the issue of any Additional Shares of
Common Stock shall be computed as follows:

                  (A) CASH AND PROPERTY. Such consideration shall:

                           (1) insofar as it  consists  of cash,  be computed at
                  the  aggregate  of cash  received  by the  Company,  excluding
                  amounts  paid or  payable  for  accrued  interest  or  accrued
                  dividends;

                           (2) insofar as it  consists  of  property  other than
                  cash, be computed at the fair market value thereof at the time
                  of such issue, as determined in good faith by the Board; and

                           (3) in the event  Additional  Shares of Common  Stock
                  are issued  together  with other shares or securities or other
                  assets of the Company for consideration  which covers both, be
                  the proportion of such consideration so received,  computed as
                  provided in clauses (1) and (2) above,  as  determined in good
                  faith by the Board.

                  (B)   OPTIONS,   RIGHTS  AND   CONVERTIBLE   SECURITIES.   The
         consideration  per share received by the Company for Additional  Shares
         of Common  Stock  deemed to have been  issued  pursuant  to  Section 3,
         relating  to  Options,  Rights  and  Convertible  Securities,  shall be
         determined by dividing

                           (1) the total amount,  if any, received or receivable
                  by the Company as consideration for the issue of such Options,
                  Rights or Convertible  Securities,  plus the minimum aggregate
                  amount  of  additional  consideration  (as  set  forth  in the
                  instruments relating thereto,  without regard to any provision
                  contained   therein  for  a  subsequent   adjustment  of  such
                  consideration)  payable to the  Company  upon the  exercise of
                  such  Options,  Rights or the  conversion  or exchange of such
                  Convertible Securities, by

                                      I-3
<PAGE>

                           (2) the maximum  number of shares of Common Stock (as
                  set forth in the instruments relating thereto,  without regard
                  to any provision contained therein for a subsequent adjustment
                  of such number)  issuable  upon the exercise of such  Options,
                  Rights  or the  conversion  or  exchange  of such  Convertible
                  Securities.

         6. ADJUSTMENT FOR STOCK SPLITS AND  COMBINATIONS.  If the Company shall
at any  time or from  time to time  after  the  Original  Issue  Date  effect  a
subdivision of the outstanding  Common Stock,  the Purchase Price then in effect
immediately before that subdivision shall be proportionately  decreased.  If the
Company  shall at any time or from time to time  after the  Original  Issue Date
combine the  outstanding  shares of Common  Stock,  the  Purchase  Price then in
effect immediately  before the combination shall be  proportionately  increased.
Any  adjustment  under this  paragraph  shall  become  effective at the close of
business on the date the subdivision or combination becomes effective.

         7. ADJUSTMENT FOR CERTAIN DIVIDENDS AND DISTRIBUTIONS. In the event the
Company  at any time or from time to time  after the  Original  Issue Date shall
make or issue a  dividend  or other  distribution  payable  in  shares of Common
Stock,  then and in each such event the Purchase  Price shall be decreased as of
the time of such issuance, by multiplying the Purchase Price by a fraction,  the
numerator  of which shall be the total  number of shares of Common  Stock issued
and  outstanding  immediately  prior  to the  time  of  such  issuance,  and the
denominator  of which shall be the total number of shares of Common Stock issued
and outstanding  immediately  prior to the time of such issuance plus the number
of shares of Common Stock issuable in payment of such dividend or distribution.

         8. ADJUSTMENTS FOR OTHER DIVIDENDS AND DISTRIBUTIONS.  In the event the
Company at any time,  or from time to time after the  Original  Issue Date shall
make or issue,  a dividend or other  distribution  payable in  securities of the
Company other than shares of Common Stock, then and in each such event provision
shall be made so that the Holders  shall receive upon exercise of the Warrant in
addition  to the  number of shares of Common  Stock  receivable  thereupon,  the
amount of  securities  of the  Company  that they  would have  received  had the
Warrants been  exercised  into Warrant  Shares on the date of such event and had
thereafter retained such securities  receivable by them as aforesaid during such
period given application to all adjustments called for during such period, under
this paragraph with respect to the rights of the Holders.

         9. ADJUSTMENT FOR RECLASSIFICATION,  EXCHANGE, OR SUBSTITUTION.  If the
Warrant Shares shall be changed into the same or a different number of shares of
any  class  or   classes   of  stock,   whether   by   capital   reorganization,
reclassification,  or otherwise  (other than a  subdivision  or  combination  of
shares or stock  dividend  provided for above),  then and in each such event the
Holder shall have the right  thereafter  to convert such share into the kind and
amount of shares of stock and other securities and property receivable upon such
reorganization,  reclassification,  or other change, by holders of the number of
shares  of Common  Stock  into  which  the  Warrant  might  have been  exercised
immediately  prior to such  reorganization,  reclassification,  or  change,  all
subject to further adjustment as provided herein.

         10.  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
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed hereunder by the Company,  but will at all
times in good faith  assist in the carrying  out of all the  provisions  of this
EXHIBIT  I and in the  taking  of  all  such  action  as  may  be  necessary  or
appropriate  in order to protect  the  exercise  rights of the  Holders  against
impairment to the extent required hereunder.

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<PAGE>

         11.  CERTIFICATE  AS  TO  ADJUSTMENTS.  Upon  the  occurrence  of  each
adjustment or readjustment of the Purchase Price pursuant to this EXHIBIT I, the
Company at its expense shall promptly compute such adjustment or readjustment in
accordance with the terms hereof and shall file a certificate setting forth such
adjustment  or  readjustment  and  showing  in detail  the facts upon which such
adjustment  or  readjustment  is based with its corporate  records.  The Company
shall, upon the reasonable  written request of any Holder furnish or cause to be
furnished  to  such  Holder  a  similar   certificate  setting  forth  (i)  such
adjustments and readjustments, (ii) the Purchase Price then in effect, and (iii)
the number of shares of Common Stock and the amount,  if any, of other  property
which then would be received  upon the  exercise of this  Warrant.  Despite such
adjustment or readjustment,  the form of each or all Warrants, if the same shall
reflect the initial or any  subsequent  Purchase  Price,  need not be changed in
order for the  adjustments or  readjustments  to be valid in accordance with the
provisions of this Warrant, which shall control.



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