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                                                                   EXHIBIT 10.28

                             ALDERWOODS GROUP, INC.

                           DIRECTOR COMPENSATION PLAN

1.       PURPOSE. This Alderwoods Group Incorporated Director Compensation Plan
         (the "Plan") is established to allow the outside directors of
         Alderwoods Group, Inc. (the "Company") to participate in the ownership
         of shares of the Company's common stock ("Common Stock").

2.       ADMINISTRATION.

(a)               The Plan shall be administered by the Compensation Committee
                  of the Board of Directors of the Company (the "Committee"),
                  which shall have full power and authority, subject to the
                  provisions of the Plan, to supervise administration of the
                  Plan and to interpret the provisions of the Plan and to
                  authorize and supervise any issuance or payment of Common
                  Stock and any crediting or payment of Deferred Stock (as
                  defined in Section 5 below) hereunder. Any decision by the
                  Committee shall be final and binding on all parties. No member
                  of the Committee shall be liable for any determination made,
                  or any decision or action taken with respect to the Plan or
                  any issuance of Common Stock under the Plan. The Committee may
                  delegate any of its responsibilities to one or more of its
                  affiliates and agents, including employees of the Company or
                  one or more of the Company's affiliates and subsidiaries, and
                  may retain advisors to provide advice to the Committee. No
                  Participant in the Plan shall participate in the making of any
                  decision with respect to any question relating to Common Stock
                  issued under the Plan exclusively to that Participant.

(b)               The Committee shall be vested with full authority to make such
                  rules and regulations as it deems necessary to administer the
                  Plan and to interpret and administer the provisions of the
                  Plan in a uniform manner. Any determination, decision or
                  action of the Committee in connection with the construction,
                  interpretation, administration or application of the Plan
                  shall be final, conclusive and binding on all parties.

(c)               The cost of issuing Common Stock pursuant to the Plan and the
                  expenses of administering the Plan shall be borne by the
                  Company.

3.       ELIGIBILITY. Shares of Common Stock shall be issued to each member of
         the Board of Directors of the Company who is not an employee of the
         Company if such member of the Board of Directors so elects in
         accordance with Section 5, provided that shares of the Company's Common
         Stock remain available for issuance hereunder in accordance with
         Section 4. Each non-employee director of the Company shall be referred
         to herein as a "Participant."

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4.       SHARES SUBJECT TO THE PLAN. The shares subject to the Plan shall be
         authorized but unissued or reacquired shares of the Company's Common
         Stock. Subject to adjustment in accordance with Section 9 of the Plan,
         the maximum number of shares of Common Stock which may be issued and/or
         credited to Accounts (as defined below) as Deferred Stock under the
         Plan shall be 100,000 and the adoption of the Plan by the Board of
         Directors of the Company shall constitute a reservation of 100,000
         authorized but unissued, or reacquired, shares of Common Stock for
         issuance under the Plan.

5.       DIRECTOR COMPENSATION ELECTION.

(a)               The amount of (i) the director retainer fee (the "Retainer"),
                  (ii) the director fees for attendance at meetings of the
                  Company's Board of Directors and/or committees thereof (the
                  "Meeting Fees"), and (iii) any other compensation paid to the
                  directors for services as a director (the "Other
                  Compensation") shall be determined from time to time by the
                  Company's Board of Directors.

(b)               Each Participant may elect to have all or any portion of his
                  or her Retainer, Meeting Fees and/or Other Compensation
                  payable in cash or Common Stock and may further elect to have
                  such Common Stock paid in the form of deferred Common Stock
                  ("Deferred Stock"), which will be credited to a booking
                  account in the name of the Participant (the "Account") in
                  accordance with this Plan.

(c)               An election to receive payment of the Retainer, the Meeting
                  Fees and/or the Other Compensation in the form of Common Stock
                  or Deferred Stock of the Company pursuant Section 5(b) above
                  must be made in writing and delivered to the Company prior to
                  the start of the calendar year in which the Retainer, the
                  Meeting Fees and/or the Other Compensation would otherwise be
                  paid and such election will be irrevocable for the affected
                  calendar year (the "Affected Year"). To participate in the
                  Plan during the calendar year in which the Plan becomes
                  effective, the Participant must make an election pursuant to
                  Section 5(b) within 30 days after the Effective Date (as
                  defined in Section 14) and such election will be irrevocable
                  for the remainder of the Affected Year. To participate in the
                  Plan during the first calendar year in which a non-employee
                  director becomes eligible to participate in the Plan, the new
                  non-employee director must make an election pursuant to
                  Section 5(b) within 30 days after the date he or she becomes
                  eligible and such election will be irrevocable for the
                  remainder of the Affected Year and, Canadian resident
                  directors, must in any event elect pursuant to Section 5(b) at
                  least 10 business days prior to the end of the first Quarter
                  in which the Participant is a director. Each election shall
                  remain in effect until revoked in writing, and any such
                  revocation shall become effective no earlier than the first
                  day of the first calendar year commencing after such
                  revocation is received by the Company. If a non-employee
                  director does not file an election form by the specified date,
                  he or she will be deemed to have elected to receive all of the
                  Retainer, the Meeting Fees and the Other Compensation in cash.

(d)               If a Participant elects to receive Common Stock in payment of
                  all or part of his or her Retainer, Meeting Fees and Other
                  Compensation, the number of shares of



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                  Common Stock to be issued shall equal the cash amount that
                  would have been paid divided by the Fair Market Value of one
                  share of Common Stock on the date on which such cash amount
                  would have been paid.

6.       DEFERRAL.

         The provisions of this Section 6 apply to Participants who are not
Canadian Resident Directors.

(a)               If a Participant elects to receive Deferred Stock in payment
                  of all or part of his or her Retainer, Meeting Fees and/or
                  Other Compensation, there shall be credited to the
                  Participant's Account as of the day such Retainer, Meeting
                  Fees and/or Other Compensation would have been paid, the
                  number of shares of Deferred Stock which is equal to the
                  number of shares of Common Stock that would otherwise have
                  been delivered to the Participant pursuant to Section 5(d)
                  above on such date. The shares of Deferred Stock credited to
                  the Participant's Account shall represent the number of shares
                  of Common Stock that the Company will issue to the Participant
                  at the end of the deferral period.

(b)               The Deferred Stock shall be subject to a deferral period
                  beginning on the date of crediting to the Participant's
                  Account and ending upon termination of service as a Director
                  or such other period as the Participant may have elected. The
                  period of deferral shall be (i) for a minimum period of one
                  year, except in the case where the Participant elects a
                  deferral period determined by reference to his or her
                  termination of service as a Director; and (ii) for a maximum
                  period of not more than 10 years after the date of termination
                  of service as a Director. During the deferral period, the
                  Participant shall have no right to transfer any rights under
                  his or her Deferred Stock and shall have no other rights of
                  ownership therein.

(c)               A Participant's Account will be credited as of the last day of
                  each calendar quarter with that number of additional shares of
                  Deferred Stock equal to the amount of cash dividends paid by
                  the Company during such quarter on the number of shares of
                  Common Stock equivalent to the number of shares of Deferred
                  Stock in the Participant's Account from time to time during
                  such quarter divided by the Fair Market Value of one share of
                  Common Stock on the last business day of such calendar
                  quarter. Such dividend equivalents, which shall likewise be
                  credited with dividend equivalents, shall be deferred until
                  the end of the deferral period for the Deferred Stock with
                  respect to which the dividend equivalents were credited.

(d)               In the event of the death of a Participant, the Participant's
                  Account shall be immediately paid in the form of Common Stock
                  to the person or persons (a "Beneficiary" or "Beneficiaries")
                  designated by the Participant (the "Beneficiary Designation")
                  to receive payment of the Participant's Account in the event
                  of the death of the Participant. If no Beneficiary Designation
                  is in effect or if no Beneficiary is then living, upon the
                  death of a Participant, such Participant's Account shall be
                  paid to the Participant's estate.



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(e)               Notwithstanding the foregoing provisions, (i) if, upon the
                  Participant's termination of service as a Director, the value
                  of the Participant's Account is less than $500, the amount of
                  such Participant's Account, at the discretion of the Board of
                  Directors, may be immediately paid to the Participant or, if
                  the Participant is deceased, to his or her Beneficiary or
                  Beneficiaries in cash or shares of Common Stock; (ii) if a
                  Change in Control of the Company occurs, the amount of each
                  Participant's Account shall immediately be paid to the
                  Director in full; and (iii) in the event of an unforeseeable
                  emergency, as defined in section 1.457-2(h)(4) and (5) of the
                  Income Tax Regulations, that is caused by an event beyond the
                  control of the Participant or the Participant's Beneficiary
                  and that would result in severe financial hardship to the
                  individual if acceleration were not permitted, the Board of
                  Directors may in its sole discretion accelerate the payment to
                  the Participant or his or her Beneficiary of the Participant's
                  Account, but only up to the amount necessary to meet the
                  emergency.

7.       DEFERRAL - CANADIAN RESIDENT DIRECTORS.

         The provisions of this Section 7 apply to Participants who are Canadian
Resident Directors.

(a)               If a Participant elects to receive Deferred Stock in payment
                  of all or part of his or her Retainer, Meeting Fees and/or
                  Other Compensation, there shall be credited to the
                  Participant's Account as of the day such Retainer, Meeting
                  Fees and/or Other Compensation would have been paid, the
                  number of shares of Deferred Stock which is equal to the
                  number of shares of Common Stock that would otherwise have
                  been delivered to the Participant pursuant to Section 5(d)
                  above on such date. The shares of Deferred Stock credited to
                  the Participant's Account shall represent the number of shares
                  of Common Stock that the Company will issue to the Participant
                  at the end of the deferral period.

(b)               The Deferred Stock will be subject to a Deferral Period
                  beginning on the date of crediting to the Participant's
                  Account and ending upon the Participant's Redemption Date.
                  During the Deferral Period, the Participant shall have no
                  right to transfer any rights under his or her Deferred Stock
                  and shall have no other rights of ownership therein.

(c)               A Participant's Account will be credited as of the last day of
                  each calendar quarter with that number of additional shares of
                  Deferred Stock equal to the amount of cash dividends paid by
                  the Company during such quarter on the number of shares of
                  Common Stock equivalent to the number of shares of Deferred
                  Stock in the Participant's Account from time to time during
                  such quarter divided by the Fair Market Value of one share of
                  Common Stock on the last business day of such calendar
                  quarter. Such dividend equivalents, which shall likewise be
                  credited with dividend equivalents, shall be deferred until
                  the end of the deferral period for the Deferred Stock with
                  respect to which the dividend equivalents were credited.



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(d)               In the event of the death of a Participant, the Participant's
                  Account shall be immediately paid in the form of Common Stock
                  to the Beneficiary or Beneficiaries designated by the
                  Participant in his or her Beneficiary Designation. If no
                  Beneficiary Designation is in effect or if no Beneficiary is
                  then living, upon the death of a Participant, such
                  Participant's Account shall be paid to the Participant's
                  estate in the form of Common Stock.

(e)               Notwithstanding the foregoing provisions, if, upon the
                  Participant's termination of service as a director, the value
                  of the Participant's Account is less than $500, the amount of
                  such Participant's Account, at the discretion of the Board of
                  Directors, may be immediately paid to the Participant or, if
                  the Participant is deceased, to his or her Beneficiary or
                  Beneficiaries in cash or shares of Common Stock.

(f)               For greater certainty, no amount will be paid and no other
                  benefit will be granted to, or in respect of a Participant
                  under the Plan or pursuant to any other arrangement, in order
                  to compensate for a downward fluctuation in the price of
                  Common Stock.

8. DEFINITIONS, ETC.

(a)               For purposes of this Plan, the Fair Market Value of the Common
                  Stock on any date means (i) the closing sale price per share
                  of Common Stock as reported on the principal exchange on which
                  shares of Common Stock are then trading, if any, or, if
                  applicable, the NASDAQ National Market System, or if there are
                  no sales on such day, on the next preceding trading day during
                  which a sale occurred, or (ii) if clause (i) does not apply,
                  the fair market value of a share of Common Stock as determined
                  by the Board of Directors of the Company. To the extent that
                  the application of any formula described in this Plan does not
                  result in a whole number of shares of Common Stock, the result
                  shall be rounded upwards to the next whole number such that no
                  fractional shares of Common Stock shall be issued under the
                  Plan.

(b)               For purposes of this Plan, a Change in Control shall have the
                  meaning ascribed to such term in the Company's 2002 Equity
                  Incentive Plan.

(c)               Notwithstanding anything to the contrary contained in this
                  Plan, it is a condition to the payment of the Participant's
                  Retainer, Meeting Fees and Other Compensation in the form of
                  Common Stock or Deferred Stock, that the issuance of shares
                  under this Plan has been registered under the Securities Act
                  of 1933, as amended and no Participant will be able to receive
                  Common Stock or Deferred Stock in payment of all or part of
                  his or her Retainer, Meeting Fees and Other Compensation
                  unless and until the Company has prepared and filed a
                  Registration Statement on Form S-8 covering the shares to be
                  issued under the Plan.

(d)               For purposes of Section 7, the following definitions apply:

                  (i)      "Canadian Resident Director" means a Participant who
                           is a resident of Canada for purposes of the INCOME
                           TAX ACT (Canada) in an Affected Year.



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                  (ii)     "Redemption Date" with respect to a Participant who
                           has a Retirement Date, shall be the day specified by
                           or in respect of the Participant in an election filed
                           with the Company and shall not be prior to the date
                           that is at least 5 business days from the date of
                           delivery of such election to the Company and shall
                           not be later than 15 December of the first calendar
                           year commencing after the Participant's Retirement
                           Date. Where a Participant fails to make an election
                           within the above-mentioned period, his or her
                           Redemption Date shall be 15 December of the first
                           calendar year commencing after the Participant's
                           Retirement Date. In any event, the payment of the
                           Participant's benefits under the Plan will take place
                           no later than 31 December of the first calendar year
                           commencing after the Participant's Retirement Date.

                  (iii)    "Retirement Date" means the date on which a
                           Participant ceases to be a director. If a Participant
                           becomes an Employee but continues to be a Director,
                           his or her participation in the Plan shall be
                           suspended effective the date of the commencement of
                           his employment and shall resume upon termination of
                           such employment. If prior to the termination of his
                           or her employment such Participant ceases to be a
                           Director, the Participant's Retirement Date shall be
                           deemed to be the date he or she ceases to be an
                           Employee.

9.       DELIVERY OF SHARES. The Company shall make delivery of certificates
         representing the shares of Common Stock which a Participant has elected
         to receive in payment of all or part of his or her Retainer, Meeting
         Fees and/or Other Compensation, within a reasonable period of time;
         PROVIDED, HOWEVER, that if any law, regulation or agreement requires
         the Company to take any action with respect to the shares before the
         issuance thereof, then the date of delivery of such shares shall be
         extended for the period necessary to take such action. Certificates
         representing shares received under this Plan may bear such restrictive
         legends as may be necessary or desirable in order to comply with the
         applicable federal and state securities laws.

10.      ADJUSTMENTS. In the event that, after the Effective Date of this Plan
         (as defined in Section 14), the outstanding shares of Common Stock are
         increased or decreased or exchanged for a different number or kind of
         shares or other securities of the Company by reason of a
         recapitalization, reclassification, stock split-up, combination of
         shares or dividend payable in stock, appropriate adjustments shall be
         made by the Company's Board of Directors in the number and kind of
         shares or other securities that may be issued under this Plan. All
         adjustments made by the Board of Directors under this Section 10 shall
         be final and conclusive.

11.      TERMINATION OR AMENDMENT OF THE PLAN. The Board of Directors may at any
         time terminate, suspend or amend the Plan, provided such amendment does
         not adversely affect the treatment under the Income Tax Act (Canada)
         (the "Act") of directors who are residents of Canada for purposes of
         the Act. An amendment or the termination of this Plan shall not
         adversely affect the right of a Participant to receive shares of Common
         Stock issuable or cash payable at the effective date of the amendment
         or termination.



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12.      WITHHOLDING TAXES. To the extent that the Company is required to
         withhold federal, state, provincial, local or foreign taxes in
         connection with any payment made or benefit realized by a Participant
         under this Plan, and the amount available to the Company for such
         withholding is insufficient, it will be a condition to the receipt of
         such payment or the realization of such benefit that the Participant
         make arrangements with the Company for payment of the balance of such
         taxes required to be withheld, which arrangements in the discretion of
         the Committee, may include relinquishment of a portion of such benefit.

13.      MISCELLANEOUS.

(a)               The rights, benefits or interests a Participant may have under
                  this Plan are not assignable or transferable and shall not be
                  subject in any manner to alienation, sale or any encumbrances,
                  liens, levies, attachments, pledges or charges of the
                  Participant or his or her creditors. Any action attempting to
                  effect any transaction of that type shall be void and of no
                  force and effect.

(b)               The adoption and maintenance of this Plan shall not be deemed
                  to be a contract between the Company and the Participant to
                  retain his or her position as a director of the Company.

(c)               The validity, interpretation and administration of the Plan
                  and any rules, regulations, determinations or decisions
                  hereunder and the rights of any and all persons having or
                  claiming to have any interest herein or hereunder shall be
                  determined exclusively in accordance with the laws of the
                  State of Delaware (without regard to the choice of law
                  provisions thereof).

(d)               All notices, elections or other communications made or given
                  pursuant to the Plan shall be in writing and shall be
                  sufficiently made or given if hand-delivered or mailed by
                  certified mail, addressed (if from the Company to the
                  Participant) to any Participant at the address contained in
                  the records of the Company for such Participant, or addressed
                  (if from the Participant to the Company) to the Secretary of
                  the Company at its principal office.

(e)               The headings in the Plan are for reference purposes only and
                  shall not affect the meaning or interpretation of the Plan.

14.      EFFECTIVE DATE OF THE PLAN. The Plan shall be effective immediately
         upon the date of its approval by the stockholders of the Company (the
         "Effective Date").




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