EXHIBIT 4.6


         THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR OTHER
SECURITIES LAWS AND NEITHER THE SECURITIES NOR ANY INTEREST THEREIN MAY BE
OFFERED, SOLD, HYPOTHECATED, PLEDGED, OR OTHERWISE DISPOSED OF IN THE UNITED
STATES OR TO U.S. PERSONS EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT AND SUCH LAWS WHICH, IN THE OPINION OF COUNSEL FOR THE
HOLDER, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO COUNSEL FOR
THIS CORPORATION, IS AVAILABLE.

                                 March 13, 1997

                          FIRST AMERICAN RAILWAYS, INC.
                        SERIES A REDEEMABLE COMMON STOCK
                                PURCHASE WARRANT

                     The Transferability of this Warrant is
                   Restricted as Provided in Section 3 hereof.

                                                  Warrant to Purchase 1,610,000
                                                         Shares of Common Stock

         For good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged by FIRST AMERICAN RAILWAYS, INC., a Nevada
corporation (the "Company"), CHARLES E. BRADSHAW, JR., is hereby granted the
right to purchase, subject to redemption hereof in accordance with Section 7
hereof, at the initial exercise price of Three and One-Half Dollars ($3.50) per
share (subject to adjustment as set forth herein), 1,610,000 shares of common
stock of the Company (the "Shares"). Each Common Stock Purchase Warrant
("Warrant") may be exercised from the date hereof until March 13, 2003. The
Shares and the Warrants are sometimes collectively referred to herein as the
"Securities."

         Each Warrant initially is exercisable at a price of Three and One-Half
Dollars ($3.50) per Share payable in cash or by certified or official bank check
in New York Clearing House funds, subject to adjustments as provided in Section
6 hereof. Upon surrender of this Warrant, with the annexed Subscription Form
duly executed, together with payment of the Purchase Price (as hereinafter
defined) for the Shares purchased at the offices of the Company, the registered
holder of this Warrant (the "Holder") shall be entitled to receive a certificate
or certificates for the Shares so purchased.

         1.     EXERCISE OF WARRANT.

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         The purchase rights represented by this Warrant are exercisable at the
option of the Holder, in whole or in part (but not as to fractional Shares
underlying this Warrant), during any period in which this Warrant may be
exercised as set forth above. In the case of the purchase of less than all the
Shares purchasable under this Warrant, the Company shall cancel this Warrant
upon the surrender hereof and shall execute and deliver a new Warrant of like
tenor for the balance of the Shares purchasable hereunder.

         2.     ISSUANCE OF CERTIFICATES.

         Upon the exercise of this Warrant and payment in full for the Shares,
the issuance of certificates for Shares underlying this Warrant shall be made
forthwith (and in any event within five (5) business days thereafter) without
charge to the Holder, including, without limitation, any tax which may be
payable in respect of the issuance thereof, and such certificates shall (subject
to the provisions of Section 3 hereof) be issued in the name of, or in such
names as may be directed by, the Holder; PROVIDED, however, that the Company
shall not be required to pay any tax which may be payable in respect of any
transfer involved in the issuance and delivery of any such certificates in a
name other than that of the Holder and the Company shall not be required to
issue or deliver such certificates unless or until the person or persons
requesting the issuance thereof shall have paid to the Company the amount of
such tax or shall have established to the satisfaction of the Company that such
tax has been paid. The certificates representing the Shares underlying this
Warrant shall be executed on behalf of the Company by the manual or facsimile
signature of the present or any future President or Vice President and Secretary
or Assistant Secretary of the Company who shall be duly authorized to execute
such certificates.

         3.     RESTRICTION ON TRANSFER.

         Neither this Warrant nor any Share issuable upon exercise hereof has
been registered under the Securities Act of 1933, as amended (the "Securities
Act"), and none of such securities may be offered, sold, pledged, hypothecated,
assigned or transferred except (i) pursuant to a registration statement under
the Securities Act which has become effective and is current with respect to
such securities, or, (ii) pursuant to a specific exemption from registration
under the Securities Act but only upon the Holder hereof first having obtained
the written opinion of counsel to the Company, or other counsel reasonably
acceptable to the Company, that the proposed disposition is consistent with all
applicable provisions of the Securities Act as well as any applicable "Blue Sky"
or similar state securities law. Upon exercise, in part or in whole, of this
Warrant, each certificate issued representing the Shares underlying this Warrant
shall bear a legend to the foregoing effect.

         4.     REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED.

                4.1 THE COMPANY'S REGISTRATION. Within 24 months following the
         issuance of this Warrant, and upon receipt of written request from the
         Holder thereof, the Company shall prepare and file, and use its "best
         efforts" to obtain the effectiveness of, with the Securities and
         Exchange Commission (the "Commission"), a registration statement along
         with such other documents, including a prospectus, as may be necessary
         in the opinion of counsel for

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         the Company in order to comply with the provisions of the Securities
         Act, so as to permit a public offering and sale of the Shares for a
         consecutive period ending 60 months after effectiveness of the
         registration statement described above. The costs and expenses
         associated with the preparation, filing and prosecution of such
         registration statements shall be borne by the Company.

         4.2    DEMAND REGISTRATION.

                (a) The Company covenants and agrees to give written notice of
         any registration request under this Section 4.2 by any Holder to all
         other Holders within ten (10) days from the date of the receipt of any
         such registration request.

                (b) The Company shall use its best efforts to file a
         registration statement within thirty (30) days of receipt of any demand
         therefor and to have any registration statement declared effective at
         the earliest possible time. The Company shall furnish each Holder
         desiring to sell the Shares such number of prospectuses as shall
         reasonably be requested.

         4.3    COVENANTS WITH RESPECT TO REGISTRATION.

                In connection with any registration under either Section 4.1 or
         4.2 hereof, the Company covenants and agrees as follows:

                (a) The Company shall pay all costs (excluding fees and expenses
         of Holder(s)' counsel and any underwriting or selling commissions or
         other charges of any broker-dealer acting on behalf of Holder(s)), fees
         and expenses in connection with all registration statements filed
         pursuant to either Section 4.1 or 4.2 hereof including, without
         limitation, the Company's legal and accounting fees, printing expenses
         and blue sky fees and expenses, and similar types of fees.

                (b) The Company will take all necessary action which may be
         required in qualifying or registering the securities included in a
         registration statement for offering and sale under the securities or
         blue sky laws of such states as reasonably are requested by the Holder,
         provided that the Company shall not be obligated to qualify as a
         foreign corporation to do business under the laws of any such
         jurisdiction.

                (c) The Company shall indemnify the Holder, each of their
         directors and officers and each person, if any, who controls such
         Holder within the meaning of Section 15 of the Securities Act or
         Section 20(a) of the Securities and Exchange Act of 1934 (the "Exchange
         Act"), against all loss, claim, damage, expense or liability (including
         all expenses reasonably incurred in investigating, preparing or
         defending against any claim whatsoever) to which any of them may become
         subject under the Securities Act, the Exchange Act or any other
         statute, common law or otherwise, arising out of or based upon any
         untrue statement or alleged untrue statement of a material fact
         contained in such registration statement executed by the Company or
         based upon written information furnished by the Company filed in any

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         jurisdiction in order to qualify the Securities under the securities
         laws thereof or filed with the Commission, any state securities
         commission or agency, the National Association of Securities Dealers,
         Inc., The Nasdaq Stock Market or any securities exchange, or the
         omission or alleged omission therefrom of a material fact required to
         be stated therein or necessary to make the statements contained therein
         not misleading, unless such statement or omission was made in reliance
         upon and in strict conformity with written information furnished to the
         Company by the Holder expressly for use in such registration statement,
         any amendment or supplement thereto or any application, as the case may
         be. If any action is brought against the Holder or any controlling
         person of the Holder in respect of which indemnity may be sought
         against the Company pursuant to this Section 4.3(c), the Holder or such
         controlling person shall, within thirty (30) days after the receipt of
         a summons or complaint, notify the Company in writing of the
         institution of such action and the Company shall assume the defense of
         such action, including the employment and payment of reasonable fees
         and expenses of counsel (which counsel shall be reasonably satisfactory
         to the Holder or such controlling person), but the failure to give such
         notice shall not affect such indemnified person's right to
         indemnification hereunder except to the extent that the Company's
         defense of such action was materially adversely affected thereby. The
         Holder or such controlling person shall have the right to employ its or
         their own counsel in any such case, but the fees and expenses of such
         counsel shall be at the expense of the Holder or such controlling
         person unless the employment of such counsel shall have been authorized
         in writing by the Company in connection with the defense of such
         action, or the Company shall not have employed counsel to have charge
         of the defense of such action or such indemnified party or parties
         shall have reasonably concluded that there may be defenses available to
         it or them which are different from or additional to those available to
         the Company (in which case the Company shall not have the right to
         direct the defense of such action on behalf of the indemnified party or
         parties), in any of which events the fees and expenses of not more than
         one additional firm of attorneys for all of the Holder and/or such
         controlling person shall be borne by the Company. Except as expressly
         provided in the previous sentence, in the event that the Company shall
         have assumed the defense of any such action or claim, the Company shall
         not thereafter be liable to the Holder or such controlling person in
         investigating, preparing or defending any such action or claim. The
         Company agrees to notify promptly the Holder of the commencement of any
         litigation or proceedings against the Company or any of its officers,
         directors or controlling persons in connection with the resale of any
         of the Securities in connection with such registration statement. The
         Company further agrees that upon demand by an indemnified person, at
         any time or from time to time, it will promptly reimburse such
         indemnified person for any loss, claim, damage, liability, cost or
         expense actually and reasonably paid by the indemnified person as to
         which the Company has indemnified such person pursuant hereto.
         Notwithstanding the foregoing provisions of this Section 4.3(c), any
         such payment or reimbursement by the Company of fees, expenses or
         disbursements incurred by an indemnified person in any proceeding in
         which a final judgment by a court of competent jurisdiction (after all
         appeals or the expiration of time to appeal) is entered against any
         Holder or such indemnified person as a direct result of any Holder or
         such person's gross negligence or willful misfeasance will be promptly
         repaid to the Company.

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         5. PURCHASE PRICE. The "Purchase Price" shall mean the initial purchase
price or the adjusted purchase price, depending upon the context. The initial
Purchase Price shall be Three and One-Half Dollars ($3.50) per Share. The
adjusted purchase price shall be the price which shall result from time to time
from any and all adjustments of the Purchase Price in accordance with the
provisions of Section 6 hereof.

         6. ADJUSTMENT OF PURCHASE PRICE AND NUMBER OF SHARES OF COMMON STOCK
            DELIVERABLE.

                (a)(i) Except as hereinafter provided, in the event the Company
         shall, at any time or from time to time after the date hereof, sell any
         shares of Common Stock for a consideration per share less than the
         Purchase Price or issue any shares of Common Stock as a stock dividend
         to the holders of Common Stock, or subdivide or combine the outstanding
         shares of Common Stock into a greater or lesser number of shares (any
         such sale, issuance, subdivision or combination being herein called a
         "Change of Shares"), then, and thereafter upon each further Change of
         Shares, the Purchase Price for the Warrants in effect immediately prior
         to such Change of Shares shall be changed to a price (including any
         applicable fraction of a cent to the nearest cent) determined by
         dividing (A) the sum of (x) the total number of shares of Common Stock
         outstanding immediately prior to such Change of Shares, multiplied by
         the Purchase Price in effect immediately prior to such Change of
         Shares, and (y) the consideration, if any, received by the Company upon
         such sale, issuance, subdivision or combination by (B) the total number
         of shares of Common Stock outstanding immediately after such Change of
         Shares; PROVIDED, HOWEVER, that in no event shall the Purchase Price be
         adjusted pursuant to this computation to an amount in excess of the
         Purchase Price in effect immediately prior to such computation, except
         in the case of a combination of outstanding shares of Common Stock.

                For the purposes of any adjustment to be made in accordance with
         this Section 6(a)(i) the following provisions shall be applicable:

                      (A) In case of the issuance or sale of shares of Common
                Stock (or of other securities deemed hereunder to involve the
                issuance or sale of shares of Common Stock) for a consideration
                part or all of which shall be cash, the amount of the cash
                portion of the consideration therefor deemed to have been
                received by the Company shall be (i) the subscription price, if
                shares of Common Stock are offered by the Company for
                subscription, or (ii) the public offering price (before
                deducting therefrom any compensation paid or discount allowed in
                the sale, underwriting or purchase thereof by underwriters or
                dealers or others performing similar services, or any expenses
                incurred in connection therewith), if such securities are sold
                to underwriters or dealers for public offering without a
                subscription offering, or (iii) the gross amount of cash
                actually received by the Company for such securities, in any
                other case.

                      (B) In case of the issuance or sale (otherwise than as a
                dividend or other distribution on any stock of the Company, and
                otherwise than on the exercise of options, rights or warrants or
                the conversion or exchange of convertible or

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                exchangeable securities) of shares of Common Stock (or of other
                securities deemed hereunder to involve the issuance or sale of
                shares of Common Stock) for a consideration part or all of which
                shall be other than cash, the amount of the consideration
                therefor other than cash deemed to have been received by the
                Company shall be the value of such consideration as determined
                in good faith by the Board of Directors of the Company on the
                basis of a record of values of similar property or services.

                      (C) Shares of Common Stock issuable by way of dividend or
                other distribution on any stock of the Company shall be deemed
                to have been issued immediately after the opening of business on
                the day following the record date for the determination of
                shareholders entitled to receive such dividend or other
                distribution and shall be deemed to have been issued without
                consideration.

                      (D) The reclassification of securities of the Company
                other than shares of Common Stock into securities including
                shares of Common Stock shall be deemed to involve the issuance
                of such shares of Common Stock for a consideration other than
                cash immediately prior to the close of business on the date
                fixed for the determination of security holders entitled to
                receive such shares, and the value of the consideration
                allocable to such shares of Common Stock shall be determined as
                provided in subsection (B) of this Section 6(a)(i).

                      (E) The number of shares of Common Stock at any one time
                outstanding shall be deemed to include the aggregate maximum
                number of shares issuable (subject to readjustment upon the
                actual issuance thereof) upon the exercise of options, rights or
                warrants and upon the conversion or exchange of convertible or
                exchangeable securities.

                      (ii) Upon each adjustment of the Purchase Price pursuant
         to this Section 6, the number of shares of Common Stock purchasable
         upon the exercise of each Warrant shall be the number derived by
         multiplying the number of shares of Common Stock purchasable
         immediately prior to such adjustment by the Purchase Price in effect
         prior to such adjustment and dividing the product so obtained by the
         applicable adjusted Purchase Price.

                (b) In case the Company shall at any time after the date hereof
         issue options, rights or warrants to subscribe for shares of Common
         Stock [other than warrants that may be issued pursuant to the
         Conversion in certain circumstances of the Company's outstanding 10%
         Convertible Secured Notes issued in 1996], or issue any securities
         convertible into or exchangeable for shares of Common Stock, for a
         consideration per share (determined as provided in Section 6(a)(i)
         hereof and as provided below) less than the Purchase Price in effect
         immediately prior to the issuance of such options, rights or warrants,
         or such convertible or exchangeable securities, or without
         consideration (including the issuance of any such securities by way of
         dividend or other distribution), the Purchase Price for the Warrants
         (whether or not the same shall be issued and outstanding) in effect
         immediately prior to the

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         issuance of such options, rights or warrants, or such convertible or
         exchangeable securities, as the case may be, shall be reduced to a
         price determined by making the computation in accordance with the
         provisions of Section 6(a)(i) hereof, provided that:

                      (A) The aggregate maximum number of shares of Common
                Stock, as the case may be, issuable or that may become issuable
                under such options, rights or warrants (assuming exercise in
                full even if not then currently exercisable or currently
                exercisable in full) shall be deemed to be issued and
                outstanding at the time such options, rights or warrants were
                issued, for a consideration equal to the minimum purchase price
                per share provided for in such options, rights or warrants at
                the time of issuance, plus the consideration, if any, received
                by the Company for such options, rights or warrants; PROVIDED,
                however, that upon the expiration or other termination of such
                options, rights or warrants, if any thereof shall not have been
                exercised, the number of shares of Common Stock deemed to be
                issued and outstanding pursuant to this subsection (A) (and for
                the purposes of subsection (E) of Section 6(a)(i) hereof) shall
                be reduced by the number of shares as to which options, warrants
                and/or rights shall have expired, and such number of shares
                shall no longer be deemed to be issued and outstanding, and the
                Purchase Price then in effect shall forthwith be readjusted and
                thereafter be the price that it would have been had adjustment
                been made on the basis of the issuance only of the shares
                actually issued plus the shares remaining issuable upon the
                exercise of those options, rights or warrants as to which the
                exercise rights shall not have expired or terminated
                unexercised.

                      (B) The aggregate maximum number of shares of Common Stock
                issuable or that may become issuable upon conversion or exchange
                of any convertible or exchangeable securities (assuming
                conversion or exchange in full even if not then currently
                convertible or exchangeable in full) shall be deemed to be
                issued and outstanding at the time of issuance of such
                securities, for a consideration equal to the consideration
                received by the Company for such securities, plus the minimum
                consideration, if any, receivable by the Company upon the
                conversion or exchange thereof; PROVIDED, HOWEVER, that upon the
                termination of the right to convert or exchange such convertible
                or exchangeable securities (whether by reason of redemption or
                otherwise), the number of shares of Common Stock deemed to be
                issued and outstanding pursuant to this subsection (B) (and for
                the purposes of subsection (E) of SECTION 6(a)(i) hereof) shall
                be reduced by the number of shares as to which the conversion or
                exchange rights shall have expired or terminated unexercised,
                and such number of shares shall no longer be deemed to be issued
                and outstanding, and the Purchase Price then in effect shall
                forthwith be readjusted and thereafter be the price that it
                would have been had adjustment been made on the basis of the
                issuance only of the shares actually issued plus the shares
                remaining issuable upon conversion or exchange of those
                convertible or exchangeable securities as to which the
                conversion or exchange rights shall not have expired or
                terminated unexercised.

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                      (C) If any change shall occur in the price per share
                provided for in any of the options, rights or warrants referred
                to in subsection (A) of this SECTION 6(b), or in the price per
                share or ratio at which the securities referred to in subsection
                (B) of this SECTION 6(b) are convertible or exchangeable, such
                options, rights or warrants or conversion or exchange rights, as
                the case may be, to the extent not theretofore exercised, shall
                be deemed to have expired or terminated on the date when such
                price change became effective in respect of shares not
                theretofore issued pursuant to the exercise or conversion or
                exchange thereof, and the Company shall be deemed to have issued
                upon such date new options, rights or warrants or convertible or
                exchangeable securities.

                (c) In case of any reclassification or change of outstanding
         shares of Common Stock issuable upon exercise of the Warrants (other
         than a change in par value, or from par value to no par value, or from
         no par value to par value or as a result of a subdivision or
         combination), or in case of any consolidation or merger of the Company
         with or into another corporation (other than a merger with a Subsidiary
         in which merger the Company is the continuing corporation and which
         does not result in any reclassification or change of the then
         outstanding shares of Common Stock or other capital stock issuable upon
         exercise of the Warrants), or in case of any sale or conveyance to
         another corporation of the property of the Company as an entirety or
         substantially as an entirety, then, as a condition of such
         reclassification, change, consolidation, merger, sale or conveyance,
         the Company, or such successor or purchasing corporation, as the case
         may be, shall make lawful and adequate provision whereby the Holder of
         each Warrant then outstanding shall have the right thereafter to
         receive on exercise of such Warrant the kind and amount of securities
         and property receivable upon such reclassification, change,
         consolidation, merger, sale or conveyance by a holder of the number of
         securities issuable upon exercise of such Warrant immediately prior to
         such reclassification, change, consolidation, merger, sale or
         conveyance and shall forthwith file at the corporate office of the
         Company, a statement signed by its Chairman of the Board, President or
         a Vice President and by its Treasurer or an Assistant Treasurer or its
         Secretary or an Assistant Secretary evidencing such provision. Such
         provisions shall include provision for adjustments which shall be as
         nearly equivalent as may be practicable to the adjustments provided for
         in Sections 6(a) and 6(b) hereof. The above provisions of this Section
         6(c) shall similarly apply to successive reclassifications and changes
         of shares of Common Stock and to successive consolidations, mergers,
         sales or conveyances.

                (d) Irrespective of any adjustments or changes in the Purchase
         Price or the number of shares of Common Stock purchasable upon exercise
         of the Warrants, the Warrant Certificates theretofore and thereafter
         issued shall, unless the Company shall exercise its option to issue new
         Warrant Certificates pursuant to the terms hereof, continue to express
         the Purchase Price per share and the number of shares purchasable
         thereunder as the Purchase Price per share and the number of shares
         purchasable thereunder were expressed in the Warrant Certificates when
         the same were originally issued.

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                (e) After each adjustment of the Purchase Price pursuant to this
         Section 6, the Company will promptly prepare a certificate signed by
         the Chairman of the Board, President, or a Vice President and by the
         Treasurer or an Assistant Treasurer or the Secretary or an Assistant
         Secretary of the Company setting forth: (i) the Purchase Price as so
         adjusted, (ii) the number of shares of Common Stock purchasable upon
         exercise of each Warrant, after such adjustment, and (iii) a brief
         statement of the facts accounting for such adjustment and will promptly
         cause such officer's certificate to be sent by ordinary first class
         mail to the Holder. No failure to mail such notice nor any defect
         therein or in the mailing thereof shall affect the validity thereof
         except as to the Holder to whom the Company failed to mail such notice,
         or except as to the Holder whose notice was defective. The affidavit of
         the Secretary or an Assistant Secretary of the Company that such notice
         has been mailed shall, in the absence of fraud, be prima facie evidence
         of the facts stated therein.

                (f) No adjustment of the Purchase Price shall be made as a
         result of or in connection with (A) the issuance or sale of shares of
         Common Stock pursuant to options, warrants, convertible notes, stock
         purchase agreements and convertible or exchangeable securities
         outstanding or in effect on the date hereof, (B) the issuance or sale
         of shares of Common Stock upon the exercise of any "incentive stock
         options" (as such term is defined in the Internal Revenue Code of 1986,
         as amended), so long as such options were outstanding on the date
         hereof or were subsequently granted with the consent of the Holder,
         which consent sahll not be unreasonably withheld, or (C) the issuance
         or sale of shares of Common Stock if the amount of said adjustment
         shall be less than ten cents ($.10). In addition, the Holder shall not
         be entitled to cash dividends paid by the Company prior to, and only to
         the extent of, the exercise of this Warrant.

         7.     REDEMPTION OF THE WARRANT.

                (a) Commencing six months from the issue date of the Warrant,
         the Company may, on 30 days' prior written notice redeem all the
         Warrants at ten cents ($.10) per Warrant, provided, however, that
         before any such call for redemption of Warrants can take place, (i) the
         Securities are registered under the Securities Act and applicable "Blue
         Sky" laws, (ii) a current prospectus is then available for the resale
         of the Securities and (iii) the closing bid price of the Common Stock
         as reported by Nasdaq, or such other market on which the Common Stock
         is then traded, exceeds $6.50 per share for the 20 consecutive trading
         days ending on the fifth trading day prior to the date of the notice of
         redemption contemplated by (b) and (c) below is given (subject to
         adjustment in the event of any stock splits or other similar events as
         provided herein).

                (b) In case the Company shall exercise its right to redeem all
         of the Warrants, it shall give or cause to be given notice to the
         Holders of the Warrants, by mailing to such Holders a notice of
         redemption, first class, postage prepaid, at their last address as
         shall appear on the records of the Company. Any notice mailed in the
         manner provided herein shall be conclusively presumed to have been duly
         given whether or not the Holder receives such notice.

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                (c) The notice of redemption shall specify (i) the redemption
         price, (ii) the date fixed for redemption, which shall in no event be
         less than thirty (30) days after the date of mailing of such notice,
         (iii) the place where the Warrant Certificate shall be delivered and
         the redemption price shall be paid, and (iv) that the right to exercise
         the Warrant shall terminate at 5:00 p.m. (Eastern time) on the business
         day immediately preceding the date fixed for redemption. The date fixed
         for the redemption of the Warrants shall be the Redemption Date. No
         failure to mail such notice nor any defect therein or in the mailing
         thereof shall affect the validity of the proceedings for such
         redemption except as to a holder (a) to whom notice was not mailed or
         (b) whose notice was defective. An affidavit of the Secretary or
         Assistant Secretary of the Company that notice of redemption has been
         mailed shall, in the absence of fraud, be prima facie evidence of the
         facts stated therein.

                (d) Any right to exercise a Warrant shall terminate at 5:00 p.m.
         (Eastern time) on the business day immediately preceding the Redemption
         Date. The redemption price payable to the Holders shall be mailed to
         such person at his/her address of record.

         8.     MERGER OR CONSOLIDATION.

         In case of any consolidation of the Company with, or merger of the
Company with, or merger of the Company into, another corporation (other than a
consolidation or merger which does not result in any reclassification or change
of the outstanding common stock of the Company), the corporation formed by such
consolidation or merger shall execute and deliver to the Holder a supplemental
warrant agreement providing that the Holder shall have the right thereafter
(until the expiration of such Warrant) to receive, upon exercise of his Warrant,
the kind and amount of shares of stock and other securities and property
receivable upon such consolidation or merger by a holder of the number of shares
of common stock of the Company for which his Warrant might have been exercised
immediately prior to such consolidation, merger, sale or transfer. Such
supplemental warrant agreement shall provide for adjustments which shall be
identical to the adjustments provided in Section 6. The above provisions of this
Section 8 shall similarly apply to successive consolidations or mergers.

         9.     EXCHANGE AND REPLACEMENT OF WARRANT.

         This Warrant is exchangeable without expense, upon the surrender hereof
by the registered Holder at the principal executive office of the Company for a
new Warrant of like tenor and date representing in the aggregate the right to
purchase the same number of Shares as are purchasable hereunder in such
denominations as shall be designated by the Holder hereof at the time of such
surrender.

         Upon receipt by the Company of evidence reasonably satisfactory to it
of the loss, theft, destruction or mutilation of this Warrant, and, in case of
loss, theft or destruction, of indemnity or security reasonably satisfactory to
it, and reimbursement to the Company of all reasonable expenses incidental
thereto, and upon surrender and cancellation of this Warrant, if mutilated, the
Company will make and deliver a new Warrant of like tenor, in lieu of this
Warrant.

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10.      ELIMINATION OF FRACTIONAL INTERESTS.

         The Company shall not be required to issue certificates representing
fractions of Shares on the exercise of this Warrant, nor shall it be required to
issue scrip or pay cash in lieu of fractional interests, it being the intent of
the parties that all fractional interests shall be eliminated.

         11.    RESERVATION OF SECURITIES.

         The Company shall at all times reserve and keep available out of its
authorized common stock, solely for the purpose of issuance upon the exercise of
this Warrant, such number of Shares as shall be issuable upon the exercise
hereof. The Company covenants and agrees that, upon exercise of this Warrant and
payment of the Purchase Price therefor, all Shares issuable upon such exercise
shall be duly and validly issued, fully paid and nonassessable.

         12.    NOTICES TO WARRANT HOLDERS.

         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 any meetings of stockholders for the election of
directors or any other matter, or as having any rights whatsoever as a
stockholder of the Company.

         13.    NOTICES.

         All notices, requests, consents and other communications required or
permitted hereunder shall be in writing and shall be delivered personally,
telegraphed or sent by certified, registered, or express mail, postage prepaid,
and shall be deemed given when so delivered personally, telegraphed or, if
mailed, five days after the date of deposit in the United States mails, as
follows:

                (a)   If to the Company, to:

                      First American Railways, Inc.
                      2445 Hollywood Boulevard
                      Hollywood, Florida 33020
                      Facsimile: (954) 920-0602
                      Attn:  Raymond Monteleone, President

                (b)   If to the Holder, to the address of such Holder as shown
         on the books of the Company.

         14.    SUCCESSORS.

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<PAGE>

         All the covenants, agreements, representations and warranties contained
in this Warrant shall bind the parties hereto and their respective heirs,
executors, administrators, distributees, successors and assigns.

         15.    HEADINGS.

         The headings in this Warrant are inserted for purposes of convenience
only and shall have no substantive effect.

         16.    LAW GOVERNING.

         This Warrant shall be construed and enforced in accordance with, and
governed by, the laws of the State of Florida, without giving effect to
conflicts of law, rules or principles.

         IN WITNESS WHEREOF, the Company has caused this Warrant to be signed in
its corporate name by, and such signature to be attested to by, a duly
authorized officer on the date first above written.

                                              FIRST AMERICAN RAIILWAYS, INC.

                                              By:/s/ RAYMOND MONTELEONE
                                                 ------------------------------
                                                 Raymond Monteleone, President

ATTEST:

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SIGN HERE

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                                SUBSCRIPTION FORM

                          (To be Executed by the Holder
                        in order to Exercise the Warrant)

                  The undersigned hereby irrevocably elects to exercise the
right to purchase Shares represented by this Warrant in accordance to the
conditions hereof and herewith makes payment of the Purchase Price of such
Shares in full.

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Signature

Address

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Social Security Number or Taxpayer's
Identification Number