Document:

Exhibit 4.2

                     TERASCAPE SOFTWARE INC.

                         1997 STOCK PLAN
                   (As Amended March 3, 1999)

     1.   Purpose.  The purpose of this Terascape Software  Inc.
1997  Stock  Plan  (the "Plan") is to advance the  interests  of
Terascape  Software  Inc.,  a  Massachusetts  corporation   (the
"Company"),  by  strengthening the ability  of  the  Company  to
attract,  retain  and  motivate key employees,  consultants  and
other  individual  contributors of or  to  the  Company  or  any
present  or  future  parent or subsidiary of  the  Company  (the
"Company  Group")  by  providing them  with  an  opportunity  to
purchase or receive as bonuses stock of the Company and  thereby
permitting  them  to  share  in the  Company's  success.  It  is
intended  that  this purpose will be effected  by  granting  (i)
incentive   stock  options  ("Incentive  Options")   which   are
intended to qualify under the provisions of Section 422  of  the
Internal  Revenue  Code  of  1986, as heretofore  and  hereafter
amended   (the   "Code"),   and  non-statutory   stock   options
("Nonqualified  Options") which are not  intended  to  meet  the
requirements  of Section 422 of the Code and which are  intended
to  be  taxed  under  Section 83 of  the  Code  (both  Incentive
Options  and Nonqualified Options shall be collectively referred
to  as "Options"), (ii) stock purchase authorizations ("Purchase
Authorizations") and (iii) stock bonus awards ("Bonuses").

     2.   Effective  Date.  This Plan was adopted  and  approved
by  the  Board  of  Directors of the Company  (the  "Board")  on
January  28,  1997 (the "effective date" of the Plan),  and  was
approved  by  the Company's stockholders within one  year  after
the effective date.

     3.   Stock  Covered by the Plan.  Subject to adjustment  as
provided  in  Sections 9 and 10 below, the shares  that  may  be
made  subject  to  Options, Purchase Authorizations  or  Bonuses
under the Plan ("Shares") shall not exceed in the aggregate  one
million  (1,000,000)  shares of the common  stock,  without  par
value,  of  the Company ("Common Stock"). Any Shares subject  to
an  Option  or  Purchase  Authorization  which  for  any  reason
expires  or is terminated unexercised as to such Shares and  any
Shares  reacquired by the Company pursuant to  forfeiture  or  a
repurchase  right  hereunder may again  be  the  subject  of  an
Option,  Purchase  Authorization or Bonus under  the  Plan.  The
Shares  purchased  pursuant to Purchase  Authorizations  or  the
exercise  of  Options under this Plan or issued as Bonuses  may,
in  whole  or in part, be either authorized but unissued  Shares
or issued Shares reacquired by the Company.

    4.    Administration.  This Plan shall be  administered  by
the  Board, whose construction and interpretation of the Plan's
terms  and provisions shall be final and conclusive. The  Board
shall have authority, subject to the express provisions of  the
Plan, to construe the Plan and the respective Options, Purchase
Authorizations, Bonuses and related agreements,  to  prescribe,
amend  and rescind rules and regulations relating to the  Plan,
to  determine  the  terms  and  provisions  of  the  respective
Options,   Purchase   Authorizations,   Bonuses   and   related
agreements,  and  to  make  all  other  determinations  in  the
judgment   of  the  Board  necessary  or  desirable   for   the
administration of the Plan. The Board may correct any defect or
supply any omission or reconcile any inconsistency in the  Plan
or  in  any  Option, Purchase Authorization, Bonus, or  related
agreement  in  the  manner  and to the  extent  it  shall  deem
expedient  to carry the Plan into effect, and it shall  be  the
sole  and final judge of such expediency. No director shall  be
liable for any action or determination made in good faith.  The
Board may, to the full extent permitted by law, delegate any or
all   of  its  powers  under  the  Plan  to  a  committee  (the
"Committee") appointed by the Board, and if the Committee is so
appointed  and  to  the extent such powers are  delegated,  all
references  to the Board in the Plan shall mean and  relate  to
such Committee.

     5.   Eligible Recipients.  Options, Purchase Authorizations
and Bonuses may be granted to such key employees, consultants or
other  individual  contributors of  or  to  the  Company  Group,
including without limitation members of the Board and members of
any scientific or technical advisory boards, as are selected  by
the  Board  (a "Participant"); provided, that only employees  of
the  Company  Group shall be eligible for grant of an  Incentive
Option.

     6.   Duration  of the Plan.  This Plan shall terminate  ten
(10)  years  from  the effective date hereof, unless  terminated
earlier  pursuant  to  Section 13  hereafter,  and  no  Options,
Purchase  Authorizations  or Bonuses  may  be  granted  or  made
thereafter.

     7.     Terms   and   Conditions   of   Options.    Purchase
Authorizations  and  Bonuses, Options,  Purchase  Authorizations
and  Bonuses granted or made under this Plan shall be  evidenced
by  agreements  in  such  form and  containing  such  terms  and
conditions  as  the  Board shall determine;  provided,  however,
that  such  agreements  shall evidence  among  their  terms  and
conditions the following:

     (a)  Price.  The purchase price per Share payable upon  the
exercise  of  each  Option  or the  purchase  pursuant  to  each
Purchase  Authorization  granted  or  made  hereunder  shall  be
determined  by  the  Board at the time the  Option  or  Purchase
Authorization  is granted or made. Subject to the  condition  of
paragraph 7(j) (i), if applicable, the purchase price per  Share
payable  upon  the  exercise of each  Incentive  Option  granted
hereunder  shall not be less than one hundred percent (100%)  of
the  fair market value per Share of the Common Stock on the  day
the Incentive Option is granted or made. Fair market value shall
be determined in accordance with procedures to be established in
good  faith  by  the  Board. Bonus Shares  shall  be  issued  in
consideration  of services previously rendered, which  shall  be
valued  for such purposes by the Board or the Committee, as  the
case may be.

     (b) Number of Shares.  Each agreement shall specify the
number of Shares to which it pertains.

     (c)  Exercise of Options.  Each Option shall be exercisable
for  the  full  amount  or  for any part  thereof  and  at  such
intervals or in such installments as the Board may determine  at
the  time  it  grants such Option; provided,  however,  that  no
Option  shall  be exercisable with respect to any  Shares  later
than  ten (10) years after the date of the grant of such  Option
(or  five  (5) years in the case of Incentive Options  to  which
paragraph  7(j)  (ii) applies). An Option shall  be  exercisable
only by delivery of a written notice to the Company's Treasurer,
or  any other officer of the Company designated by the Board  to
accept  such  notices on its behalf, specifying  the  number  of
Shares  for  which  the Option is exercised and  accompanied  by
either   (i)  payment  or  (ii)  if  permitted  by  the   Board,
irrevocable instructions to a broker to promptly deliver to  the
Company  full  payment in accordance with  paragraph  7(d)  (ii)
below  of  the  amount necessary to pay the  aggregate  exercise
price.  With  respect to an Incentive Option, the permission  of
the  Board referred to in clause (ii) of the preceding  sentence
must be granted at the time the Incentive Option is granted.

     (d)  Payment.   Payment shall be made in full  (i)  at  the
time   the   Option  is  exercised,  (ii)  promptly  after   the
Participant forwards the irrevocable instructions referred to in
paragraph 7(c) (ii) above to the appropriate broker, if exercise
of  an Option is made pursuant to paragraph 7(c) (ii) above,  or
(iii)   at   the  time  the  purchase  pursuant  to  a  Purchase
Authorization is made. Payment shall be made either (a) in cash,
(b) by check, (c) if permitted by the Board (with respect to  an
Incentive  Option, such permission to have been granted  at  the
time  of the Incentive Option grant), by delivery and assignment
to  the  Company of shares of Company stock having a fair market
value  (as  determined by the Board) equal to  the  exercise  or
purchase  price, (d) if permitted by the Board,  stated  in  the
agreement  evidencing the Option or Purchase Authorization,  and
to   the  extent  permitted  by  any  applicable  law,  by   the
Participant's recourse promissory note, which note must  be  due
and  payable  not more than five (5) years after  the  date  the
Option  or  Purchase Authorization is exercised,  or  (e)  by  a
combination  of (a), (b), (c) and/or (d). If shares  of  Company
stock  are  to be used to pay the exercise price of an Incentive
Option, the Company prior to such payment must be furnished with
evidence satisfactory to it that the acquisition of such  shares
and  their transfer in payment of the exercise price satisfy the
requirements  of  Section 422 of the Code and  other  applicable
laws.

     (e) Withholding Taxes, Delivery of Shares. The Company's
obligation to deliver Shares upon exercise of an Option or upon
purchase pursuant to a Purchase Authorization or issuance
pursuant to a Bonus shall be subject to the Participant's
satisfaction of all applicable federal, state and local income
and employment tax withholding obligations. Without limiting
the generality of the foregoing, the Company shall have the
right to deduct from payments of any kind otherwise due to the
Participant any federal, state or local taxes of any kind
required by law to be withheld with respect to any Shares
issued upon exercise of Options or purchased or issued pursuant
to Purchase Authorizations or Bonuses. The Participant may
elect to satisfy such obligation(s), in whole or in part, by
(i) delivering to the Company a check for the amount required
to be withheld or (ii) if the Board in its sole discretion
approves in any specific or general case, having the Company
withhold Shares or delivering to the Company already-owned
shares of Common Stock, having a value equal to the amount
required to be withheld, as determined by the Board.

     (f)    Non-Transferability.   No   Option   or    Purchase
Authorization   shall  be  transferable  by   the   Participant
otherwise  than by will or the laws of descent or distribution,
and  each Option or Purchase Authorization shall be exercisable
during the Participant's lifetime only by the Participant.

     (g)  Termination of Purchase Authorizations  and  Options.
Each  Purchase Authorization shall terminate and may no  longer
be  exercised  if  the Participant ceases  for  any  reason  to
provide  services to a member of the Company Group.  Except  to
the  extent  the  Board provides specifically in  an  agreement
evidencing an Option for a lesser period (or a greater  period,
in  the  case of Nonqualified Options only), each Option  shall
terminate  and  may no longer be exercised if  the  Participant
ceases  for any reason to provide services to a member  of  the
Company Group in accordance with the following provisions:

      (i) if the Participant ceases to perform services for any
          reason other than death or
          disability (as defined in Section 22 (e) (3) of the
          Code), the Participant may, at any
          time within a period of thirty (30) days after the
          date of such cessation of the
          performance of services, exercise the Option to the
          extent that the Option was
          exercisable on the date of such cessation;

      (ii)if the Participant ceases to perform services because
          of disability (as defined in
          Section 22 (e) (3) of the Code), the Participant may,
          at any time within a period of one
          hundred eighty (180) days after the date of such
          cessation of the performance of
          services, exercise the Option to the extent that the
          Option was exercisable on the date
          of such cessation; and

      (iii)if the Participant ceases to perform services because of death,
           the Option, to the extent that the Participant was entitled to
           exercise it on the date of death, may be
           exercised within a period of one hundred eighty (180)
           days after the Participant's
           death   by  the  person  or  persons  to  whom   the
           Participant's rights under the Option pass  by  will
           or by the laws of descent or distribution;

     provided, however, that no Option or Purchase
     Authorization may be exercised to any extent by anyone
     after the date of its expiration; and provided,
     further, that Options and Purchase Authorizations may
     be exercised only as to Vested Shares (as defined in
     the applicable agreement with the Participant) after
     the Participant has ceased to perform services for any
     member of the Company Group.

     (h)  Rights  as Stockholder. A Participant shall  have  no
rights  as a stockholder with respect to any Shares covered  by
an  Option, Purchase Authorization or Bonus until the  date  of
issuance  of a stock certificate in the Participant's name  for
such Shares.

     (i)  Repurchase  of  Shares by  the  Company.  Any  Shares
purchased  or acquired upon exercise of an Option  or  pursuant
to  a Purchase Authorization or Bonus may in the discretion  of
the  Board  be  subject to repurchase by or forfeiture  to  the
Company  if and to the extent and at the repurchase  price,  if
any,  specifically set forth in the option, purchase  or  bonus
agreement  pursuant  to  which the  Shares  were  purchased  or
acquired.  Certificates  representing Shares  subject  to  such
repurchase  or  forfeiture may be subject to  such  escrow  and
stock  legending provisions as may be set forth in the  option,
purchase  or bonus agreement pursuant to which the Shares  were
purchased or acquired.

     (j)  10%  Stockholder.  If  any  Participant  to  whom  an
Incentive Option is granted pursuant to the provisions  of  the
Plan  is on the date of grant the owner of stock (as determined
under Section 424 (d) of the Code) possessing more than 10%  of
the  total  combined voting power or value of  all  classes  of
stock  of  the  Company, its parent, if any,  or  subsidiaries,
then the following special provisions shall be applicable:

      (i) The exercise price per Share subject to such Option
          shall not be less than 10% of the fair market value
          of each Share on the date of grant; and

     (ii) The Option shall not have a term in excess of five
          years from the date of grant.

     8.  Restrictions on Incentive Options. Incentive Options
     granted under this Plan shall be
specifically designated as such and shall be subject to the
additional restriction that the aggregate fair
market value, determined as of the date the Incentive Option is
granted, of the Shares with respect to
which Incentive Options are exercisable for the first time by a
Participant during any calendar year
shall not exceed $100,000. If an Incentive Option which exceeds
the $100,000 limitation of this
paragraph 8 is granted, the portion of such Option which is
exercisable for shares in excess of the
$100,000 limitation shall be treated as a Nonqualified Option
pursuant to Section 422 (d) of the Code.
In the event that such Participant is eligible to participate in
any other stock incentive plans of the
Company, its parent, if any, or a subsidiary which are also
intended to comply with the provisions of
Section 422 of the Code, such annual limitation shall apply to
the aggregate number of shares for which
options may be granted under all such plans.

    9.     Stock  Dividends: Stock Splits, Stock  Combinations,
Recapitalizations. Appropriate adjustment shall be made by  the
Board  in the maximum number of Shares subject to the Plan  and
in  the  number, kind, and exercise or purchase price of Shares
covered  by  outstanding  Options and  Purchase  Authorizations
granted hereunder to give effect to any stock dividends.  stock
splits,   stock  combinations,  recapitalizations   and   other
similar  changes in the capital structure of the Company  after
the effective date of the Plan.

          10.Merger, etc.

         (a)  In  the  event  of  any merger,  consolidation  or
similar  reorganization of the Company as a result of which  the
Common Stock is converted into or exchanged for cash, securities
or   other   property,  all  outstanding  Options  and  Purchase
Authorizations  granted  hereunder  shall,  effective  upon  the
consummation  of such transaction, be deemed to cover  (i)  such
amount of cash, securities or other property which one share  of
Common  Stock  was  converted into  or  exchanged  for  in  such
transaction  multiplied by (ii) the number of shares  of  Common
Stock   subject   to  such  Option  or  Purchase   Authorization
immediately  prior to the consummation of such transaction.  The
Board  of Directors of the Company shall use reasonable  efforts
to  cause  the  acquiring  or  succeeding  corporation  in  such
transaction  to  assume such Options and Purchase Authorizations
in  the  manner provided in the immediately preceding  sentence;
provided,  however, if such acquiring or succeeding  corporation
does   not   agree  to  so  assume  such  Options  and  Purchase
Authorizations, then the Company shall, by written notice to the
holders  of  such Options and Purchase Authorizations  given  at
least  10 days prior to the closing of such transaction, provide
that   all  such  Options  and  Purchase  Authorizations   shall
terminate (to the extent not then exercised) effective upon  the
closing of such transaction.

         (b)  In  the  event of a dissolution or liquidation  of
the  Company  (a  "Liquidation"), all  outstanding  Options  and
Purchase Authorizations shall terminate (to the extent not  then
exercised)  effective upon such Liquidation. The  Company  shall
give  written notice to each holder of an outstanding Option  or
Purchase  Authorization of a proposed Liquidation  at  least  10
days prior to the effective date of such Liquidation.

         (c)  Notwithstanding the foregoing provisions  of  this
Section 10, effective immediately prior to (i) a Liquidation  or
(ii) an Acquisition (as defined below), the number of shares  of
Common  Stock for which each Eligible Option (as defined  below)
is  then  exercisable shall be increased (if the Option  is  not
already  fully  vested) to such number as  would  apply  if  the
vesting schedule for such Option had commenced one year prior to
the  date  specified in the agreement for such Option (with  the
remaining  vesting schedule for such Option, to the extent  such
Option remains outstanding, shortened by one year). For purposes
of  this  Section 10, an "Acquisition" shall mean (i) a  merger,
consolidation or other business combination which results in the
stockholders   of  the  Company  immediately   prior   to   such
transaction owning, immediately following such transaction, less
than  50% of the outstanding voting stock of the Company or  (if
the  Company  is  not  the surviving corporation  or  becomes  a
subsidiary of another Company in such transaction) the surviving
or acquiring entity, (ii) the sale of shares of capital stock of
the  Company,  in  a  single transaction or  series  of  related
transactions,  representing  at least  51%  of  the  outstanding
voting  stock  of  the  Company or (iii)  the  sale  of  all  or
substantially all of the assets of the Company. For purposes  of
this  Section 10, an "Eligible Option" shall mean an Option that
is  held  by  an  optionee who continues to be employed  by  the
Company at the time of the effectiveness of such Liquidation  or
Acquisition and that has not expired as of the effective date of
such  Liquidation or Acquisition; provided that  an  Option  for
which  vesting  does  not  commence  until  certain  performance
targets are achieved shall be deemed an Eligible Option only  if
and  to  the  extent  that such performance  targets  have  been
achieved.

    11.   Investment  Representations:  Transfer  Restrictions.
The  Company  may  require  Participants,  as  a  condition  of
purchasing Shares pursuant to the exercise of an Option or to a
Purchase Authorization or receipt of shares as a Bonus, to give
written  assurances in substance and form satisfactory  to  the
Company to the effect that such person is acquiring the  Shares
for  the Participant's own account for investment and not  with
any  present intention of selling or otherwise distributing the
same,  and to such other effects as the Company deems necessary
or  appropriate (including without limitation confirmation that
the  Participant  is  aware of any applicable  restrictions  on
transfer  of  the Shares, as specified in the  by-laws  of  the
Company  or  otherwise)  in order to comply  with  federal  and
applicable state securities laws.

    12. Definitions.

     (a) The term "employee" shall have, for purposes of this
Plan, the meaning ascribed to "employee" under Section 340 1
(c) of the Code and the regulations promulgated thereunder.

     (b) The term "Exchange Act" shall mean the
Securities Exchange Act of 1934, as heretofore and
hereafter amended.

     (b) The term "Parent" shall have, for purposes of this
Plan, the meaning ascribed to it under Section 424 (e) of the
Code and the regulations promulgated thereunder.

     (d) The term "subsidiary" shall have, for all purposes
under this Plan, the meaning ascribed to it under Section 424
(f) of the Code and the regulations promulgated thereunder.

    13.   Termination or Amendment of Plan. The Board may at any
time terminate the Plan or make such changes in or additions  to
the  Plan  as it deems advisable without further action  on  the
part of the stockholders of the Company, provided:

    (a)   that no such termination or amendment shall adversely
affect   or  impair  any  then  outstanding  Option,   Purchase
Authorization, Bonus or related agreement without  the  consent
of the Participant holding such Option, Purchase Authorization,
Bonus or related agreement; and

    (b)   that  no  such  amendment  which  (i)  increases  the
maximum  number of Shares subject to this Plan (except  to  the
extent  provided in Section 3), (ii) materially  increases  the
benefits accruing to Participants, or (iii) materially modifies
the  requirements  as to eligibility for participation  in  the
Plan  may be made without obtaining, or being conditioned upon,
stockholder approval.

    With the consent of the Participant affected, the Board  may
amend  outstanding Options, Purchase Authorizations, Bonuses  or
related  agreements in a manner not inconsistent with the  Plan.
The  Board shall have the right to amend or modify the terms and
provisions of the Plan and of any outstanding Incentive  Options
granted under the Plan to the extent necessary to qualify any or
all such Options for such favorable federal income tax treatment
(including  deferral  of  taxation  upon  exercise)  as  may  be
afforded incentive stock options under Section 422 of the Code.<PAGE>
                                                                     EXHIBIT 4.1

                                     WARRANT

THIS WARRANT AND THE SECURITIES ISSUABLE UPON ITS EXERCISE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY
STATE SECURITIES LAW, AND MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION UNDER THE ACT OR IN A TRANSACTION WHICH, IN THE OPINION OF COUNSEL
REASONABLY SATISFACTORY TO WORKSCAPE, INC., QUALIFIES AS AN EXEMPT TRANSACTION
UNDER THE ACT AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER.

                                 WORKSCAPE, INC.

                          Common Stock Purchase Warrant

         WORKSCAPE, INC., a Massachusetts corporation (the "Company"), hereby
certifies that, for value received, Warburg, Pincus Equity Partners L.P. (the
"Holder"), or assigns, is entitled, subject to the terms set forth below, to
purchase from the Company, at any time and from time to time during the period
beginning on the date hereof and ending on July 15, 2009 in whole or in part, an
aggregate of 13,781,250 fully paid and non-assessable shares (the "Aggregate
Number") of the Class A Common Stock of the Company at a purchase price, subject
to the provisions of Paragraph 3 hereof, of $1.20 per share (the "Purchase
Price"). The Purchase Price and the number and character of such shares are
subject to adjustment as provided below, and the term "Common Stock" shall mean,
unless the context otherwise requires, the Class A Common Stock or other
securities or property at the time deliverable upon the exercise of this
Warrant. This Warrant is herein called the "Warrant."

         1. EXERCISE OF WARRANT. The purchase rights evidenced by this Warrant
shall be exercised by the holder surrendering this Warrant, with the form of
subscription at the end hereof duly executed by such holder, to the Company at
its office in Natick, Massachusetts, accompanied by payment, of an amount (the
"Exercise Payment") equal to the Purchase Price multiplied by the number of
shares being purchased pursuant to such exercise, payable as follows: (a) by
payment to the Company in cash, by certified or official bank check, or by wire
transfer of the Exercise Amount, (b) by surrender to the Company for
cancellation of Series C Preferred Stock, par value $0.01 per share (the "Series
C Preferred Stock"), of the Company or, in the event there are no such shares of
Series C Preferred Stock outstanding, any other securities of the Company, in
each case

<PAGE>

having a Market Price (as hereinafter defined) on the date of exercise equal to
the Exercise Amount; or (c) by a combination of the methods described in clauses
(a) and (b) above. In lieu of exercising the Warrant, the holder may elect to
receive a payment equal to the difference between (i) the Market Price
multiplied by the number of shares as to which the payment is then being elected
and (ii) the Exercise Payment with respect to such shares, payable by the
Company to the Holder only in shares of Common Stock valued at the Market Price
on the date of exercise. For purposes hereof, the term "Market Price" with
respect to the Series C Preferred Stock shall mean $1.20 per share plus accrued
but unpaid dividends and, with respect to Common Stock or other securities of
the Company, shall mean the average closing price of a share of Common Stock for
the 15 consecutive trading days preceding such day on the principal national
securities exchange on which the shares of Common Stock or other securities are
listed or admitted to trading or, if not listed or admitted to trading on any
national securities exchange, the average of the reported bid and asked prices
during such 15 trading day period in the over-the-counter market as furnished by
the National Quotation Bureau, Inc., or, if such firm is not then engaged in the
business of reporting such prices, as furnished by any member of the National
Association of Securities Dealers, Inc. selected by the Company or, if the
shares of Common Stock or other securities are not publicly traded, the Market
Price for such day shall be the fair market value thereof determined jointly by
the Company and the holder of this Warrant; provided, however, that if such
parties are unable to reach agreement within a reasonable period of time, the
Market Price shall be determined in good faith by the independent investment
banking firm selected jointly by the Company and the holder of this Warrant or,
if that selection cannot be made within 15 days, by an independent investment
banking firm selected by the American Arbitration Association in accordance with
its rules.

         1.1 Partial Exercise. This Warrant may be exercised for less than the
full number of shares of Common Stock, in which case the number of shares
receivable upon the exercise of this Warrant as a whole, and the sum payable
upon the exercise of this Warrant as a whole, shall be proportionately reduced.
Upon any such partial exercise, the Company at its expense will forthwith issue
to the holder hereof a new Warrant or Warrants of like tenor calling for the
number of shares of Common Stock as to which rights have not been exercised,
such Warrant or Warrants to be issued in the name of the holder hereof or his
nominee (upon payment by such holder of any applicable transfer taxes).

         1.2 Reduction in the Aggregate Number. In the event the Company
exercises its option to redeem all, but not a part of, the Series C Preferred
Stock pursuant to the terms of Article III, Section 8 of the Company's Articles
of Organization on or before July 15, 2000 the Aggregate Number shall be reduced
by 5,953,500 (subject to the adjustments as provided below).

                                      -2-
<PAGE>

         2. DELIVERY OF STOCK CERTIFICATES ON EXERCISE. As soon as practicable
after the exercise of this Warrant and payment of the Purchase Price, and in any
event within ten (10) days thereafter, the Company, at its expense, will cause
to be issued in the name of and delivered to the holder hereof a certificate or
certificates for the number of fully paid and non-assessable shares or other
securities or property to which such holder shall be entitled upon such
exercise, plus, in lieu of any fractional share to which such holder would
otherwise be entitled, cash in an amount determined in accordance with Paragraph
3.9 hereof. The Company agrees that the shares so purchased shall be deemed to
be issued to the holder hereof as the record owner of such shares as of the
close of business on the date on which this Warrant shall have been surrendered
and payment made for such shares as aforesaid.

         3. ANTI-DILUTION PROVISIONS AND OTHER ADJUSTMENTS. In order to prevent
dilution of the right granted hereunder, the Purchase Price shall be subject to
adjustment from time to time in accordance with this Paragraph 3. Upon each
adjustment of the Purchase Price pursuant to this Paragraph 3, the registered
Holder of this Warrant shall thereafter be entitled to acquire upon exercise, at
the Purchase Price resulting from such adjustment, the number of shares of the
Company's Common Stock obtainable by multiplying the Purchase Price in effect
immediately prior to such adjustment by the number of shares of the Company's
Common Stock acquirable immediately prior to such adjustment and dividing the
product thereof by the Purchase Price resulting from such adjustment.

         3.1 Adjustment for Issue or Sale of Common Stock at Less than Purchase
Price. Except as provided in Paragraph 3.2 or 3.5 below, if and whenever on or
after the date of issuance hereof the Company shall issue or sell, or shall in
accordance with subparagraphs 3.1(1) to (9), inclusive, be deemed to have issued
or sold, any shares of its Common Stock for a consideration per share less than
the Purchase Price in effect immediately prior to the time of such issue or
sale, then forthwith upon such issue or sale (the "Triggering Transaction"), the
Purchase Price shall, subject to subparagraphs (1) to (9) of this Paragraph 3.1,
be reduced to the Purchase Price (calculated to the nearest tenth of a cent)
determined by dividing:

                  (i) an amount equal to the sum of (x) the product derived by
      multiplying the Number of Common Shares Deemed Outstanding immediately
      prior to such Triggering Transaction by the Purchase Price then in effect,
      plus (y) the consideration, if any, received by the Company upon
      consummation of such Triggering Transaction, by

                  (ii) an amount equal to the sum of (x) the Number of Common
      Shares Deemed Outstanding immediately prior to such Triggering Transaction
      plus (y) the number of shares of Common Stock issued (or deemed to be
      issued in accordance

                                      -3-
<PAGE>

      with subparagraphs 3.1(1) to (9)) in connection with the Triggering
      Transaction.

         For purposes of this Paragraph 3, the term "Number of Common Shares
Deemed Outstanding" at any given time shall mean the sum of (i) the number of
shares of Common Stock outstanding at such time, (ii) the number of shares of
Common Stock issuable assuming conversion at such time of the Convertible
Preferred Stock (as defined in the Company's Articles of Organization) and (iii)
the number of shares of the Company's Common Stock deemed to be outstanding
under subparagraphs 3.1(1) to (9), inclusive, at such time.

         For purposes of determining the adjusted Purchase Price under this
Paragraph 3.1, the following subsections (1) to (9), inclusive, shall be
applicable:

                  (1) In case the Company at any time shall in any manner grant
         (whether directly or by assumption in a merger or otherwise) any rights
         to subscribe for or to purchase, or any options for the purchase of,
         Common Stock or any stock or other securities convertible into or
         exchangeable for Common Stock (such rights or options being herein
         called "Options" and such convertible or exchangeable stock or
         securities being herein called "Convertible Securities"), whether or
         not such Options or the right to convert or exchange any such
         Convertible Securities are immediately exercisable and the price per
         share for which the Common Stock is issuable upon exercise, conversion
         or exchange (determined by dividing (x) the total amount, if any,
         received or receivable by the Company as consideration for the granting
         of such options, plus the minimum aggregate amount of additional
         consideration payable to the Company upon the exercise of all such
         options, plus, in the case of such options which relate to Convertible
         Securities, the minimum aggregate amount of additional consideration,
         if any, payable upon the issue or sale of such Convertible Securities
         and upon the conversion or exchange thereof, by (y) the total maximum
         number of shares of Common Stock issuable upon the exercise of such
         Options or the conversion or exchange of such Convertible Securities)
         shall be less than the Purchase Price in effect immediately prior to
         the time of the granting of such Option, then the total maximum amount
         of Common Stock issuable upon the exercise of such Options, or, in the
         case of Options for Convertible Securities, upon the conversion or
         exchange of such Convertible Securities, shall (as of the date of
         granting of such options) be deemed to be outstanding and to have been
         issued and sold by the company for such price per share. No adjustment
         of the Purchase Price shall be made upon the actual issue of such
         shares of Common Stock or such Convertible

                                      -4-
<PAGE>

         Securities upon the exercise of such Options, except as otherwise
         provided in subparagraph (3) below.

                  (2) In case the Company at any time shall in any manner issue
         (whether directly or by assumption in a merger or otherwise) or sell
         any Convertible Securities, whether or not the rights to exchange or
         convert thereunder are immediately exercisable, and the price per share
         for which Common Stock is issuable upon such conversion or exchange
         (determined by dividing (x) the total amount received or receivable by
         the Company as consideration for the issue or sale of such Convertible
         Securities, plus the minimum aggregate amount of additional
         consideration, if any, payable to the Company upon the conversion or
         exchange thereof, by (y) the total maximum number of shares of Common
         Stock issuable upon the conversion or exchange of all such Convertible
         Securities) shall be less than the Purchase Price in effect immediately
         prior to the time of such issue or sale, then the total maximum number
         of shares of Common Stock issuable upon conversion or exchange of all
         such Convertible Securities shall (as of the date of the issue or sale
         of such Convertible Securities) be deemed to be outstanding and to have
         been issued and sold by the Company for such price per share. No
         adjustment of the Purchase Price shall be made upon the actual issue of
         such Common Stock upon exercise of the rights to exchange or convert
         under such Convertible Securities, except as otherwise provided in
         subparagraph (3) below.

                  (3) If the purchase price provided for in any options referred
         to in subparagraph (1), the additional consideration, if any, payable
         upon the conversion or exchange of any Convertible Securities referred
         to in subparagraphs (1) or (2), or the rate at which any Convertible
         Securities referred to in subparagraph (1) or (2) are convertible into
         or exchangeable for Common Stock shall change at any time (other than
         under or by reason of provisions designed to protect against dilution
         of the type set forth in Paragraph 3.1 or 3.3), the Purchase Price in
         effect at the time of such change shall forthwith be readjusted to the
         Purchase Price which would have been in effect at such time had such
         Options or Convertible Securities still outstanding provided for such
         changed purchase price, additional consideration or conversion rate, as
         the case may be, at the time initially granted, issued or sold. If the
         purchase price provided for in any Option referred to in subparagraph
         (1) or the rate at which any Convertible Securities referred to in
         subparagraphs (1) or (2) are convertible into or exchangeable for
         Common Stock, shall be reduced at any time under or by reason of
         provisions with respect thereto designed to

                                      -5-
<PAGE>

         protect against dilution, then in case of the delivery of Common Stock
         upon the exercise of any such Option or upon conversion or exchange of
         any such Convertible Security, the Purchase Price then in effect
         hereunder shall forthwith be adjusted to such respective amount as
         would have been obtained had such Option or Convertible Security never
         been issued as to such Common Stock and had adjustments been made upon
         the issuance of the shares of Common Stock delivered as aforesaid, but
         only if as a result of such adjustment the Purchase Price then in
         effect hereunder is hereby reduced.

                  (4) On the expiration of any Option or the termination of any
         right to convert or exchange any Convertible Securities, the Purchase
         Price then in effect hereunder shall forthwith be increased to the
         Purchase Price which would have been in effect at the time of such
         expiration or termination had such Option or Convertible Securities, to
         the extent outstanding immediately prior to such expiration or
         termination, never been issued.

                  (5) In case any Options shall be issued in connection with the
         issue or sale of other securities of the Company, together comprising
         one integral transaction in which no specific consideration is
         allocated to such Options by the parties thereto, such options shall be
         deemed to have been issued without consideration.

                  (6) In case any shares of Common Stock, Options or Convertible
         Securities shall be issued or sold or deemed to have been issued or
         sold for cash, the consideration received therefor shall be deemed to
         be the amount received by the Company therefor. In case any shares of
         Common Stock, Options or Convertible Securities shall be issued or sold
         for a consideration other than cash, the amount of the consideration
         other than cash received by the Company shall be the fair value of such
         consideration as determined in good faith by the Board of Directors of
         the Company. In case any shares of Common Stock, Options or Convertible
         Securities shall be issued in connection with any merger in which the
         Company is the surviving corporation, the amount of consideration
         therefor shall be deemed to be the fair value of such portion of the
         net assets and business of the non-surviving corporation as shall be
         attributed by the Board of Directors of the Company in good faith to
         such Common Stock, Options or Convertible Securities, as the case may
         be.

                                      -6-
<PAGE>

                  (7) The number of shares of Common Stock outstanding at any
         given time shall not include shares owned or held by or for the account
         of the Company, and the disposition of any shares so owned or held
         shall be considered an issue or sale of Common Stock for the purpose of
         this Paragraph 3.1.

                  (8) In case the Company shall declare a dividend or make any
         other distribution upon the stock of the Company payable in Options or
         Convertible Securities, then in such case any Options or Convertible
         Securities, as the case may be, issuable in payment of such dividend or
         distribution shall be deemed to have been issued or sold without
         consideration.

                  (9) For purposes of this Paragraph 3.1, in case the Company
         shall take a record of the holders of its Common Stock for the purpose
         of entitling them (x) to receive a dividend or other distribution
         payable in Common Stock, Options or in Convertible Securities, or (y)
         to subscribe for or purchase Common Stock, Options or Convertible
         Securities, then such record date shall be deemed to be the date of the
         issue or sale of the shares of Common Stock deemed to have been issued
         or sold upon the declaration of such dividend or the making of such
         other distribution or the date of the granting of such right or
         subscription or purchase, as the case may be.

         3.2 Dividends Not Paid Out of Earnings or Earned Surplus. In the event
the Company shall declare a dividend upon the Common Stock (other than a
dividend payable in Common Stock) payable otherwise than out of earnings or
earned surplus, determined in accordance with generally accepted accounting
principles, including the making of appropriate deductions for minority
interests, if any, in subsidiaries (herein referred to as "Liquidating
Dividends"), then, as soon as possible after the exercise of this Warrant, the
Company shall pay to the person exercising such Warrant an amount equal to the
aggregate value at the time of such exercise of all Liquidating Dividends
(including but not limited to the Common Stock which would have been issued at
the time of such earlier exercise and all other securities which would have been
issued with respect to such Common Stock by reason of stock splits, stock
dividends, mergers or reorganizations, or for any other reason). For the
purposes of this Paragraph 3.2, a dividend other than in cash shall be
considered payable out of earnings or earned surplus only to the extent that
such earnings or earned surplus are charged an amount equal to the fair value of
such dividend as determined in good faith by the Board of Directors of the
Company.

         3.3 Subdivisions and Combinations. In case the Corporation shall at any
time (i) subdivide the outstanding Common Stock or (ii) issue a stock dividend
on its outstanding

                                      -7-
<PAGE>

Common Stock, the Purchase Price in effect immediately prior to such subdivision
or dividend shall be proportionately reduced by the same ratio as the
subdivision or dividend. In case the Corporation shall at any time combine its
outstanding Common Stock, the Purchase Price in effect immediately prior to such
combination shall be proportionately increased by the same ratio as the
combination.

         3.4 Reorganization, Reclassification, Consolidation, Merger or Sale of
Assets. If any capital reorganization or reclassification of the capital stock
of the Company, or consolidation or merger of the Company with another
corporation, or the sale of all or substantially all of its assets to another
corporation shall be effected in such a way that holders of Common Stock shall
be entitled to receive stock, securities, cash or other property with respect to
or in exchange for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate provision
shall be made whereby the holder of this Warrant shall have the right to acquire
and receive upon exercise of this Warrant such shares of stock, securities, cash
or other property issuable or payable (as part of the reorganization,
reclassification, consolidation, merger or sale) with respect to or in exchange
for such number of outstanding shares of the Company's Common Stock as would
have been received upon exercise of this Warrant at the Purchase Price then in
effect. The Company will not effect any such consolidation, merger or sale,
unless prior to the consummation thereof the successor corporation (if other
than the Company) resulting from such consolidation or merger or the corporation
purchasing such assets shall assume by written instrument mailed or delivered to
the holder of this Warrant at the last address of such holder appearing on the
books of the Company, the obligation to deliver to such holder such shares of
stock, securities, cash or other property as, in accordance with the foregoing
provisions, such holder may be entitled to purchase. If a purchase, tender or
exchange offer is made to and accepted by the holders of more than 50% of the
outstanding shares of Common Stock of the Company, the Company shall not effect
any consolidation, merger or sale with the person having made such offer or with
any Affiliate of such person, unless prior to the consummation of such
consolidation, merger or sale the holder of this Warrant shall have been given a
reasonable opportunity to then elect to receive upon the exercise of this
Warrant either the stock, securities, cash or other property then issuable with
respect to the Common Stock of the Company or the stock, securities, cash or
other property, or the equivalent, issued to previous holders of the Common
Stock in accordance with such offer. For purposes hereof the term "Affiliate"
with respect to any given person shall mean any person controlling, controlled
by or under common control with the given person.

         3.5 No Adjustment for Exercise of Certain Options, Warrants, Etc. The
provisions of this Section 3 shall not apply

                                      -8-
<PAGE>

to any Common Stock issued, issuable or deemed outstanding under subparagraphs
3.1(1) to (9) inclusive: (i) to any person pursuant to any stock option, stock
purchase or similar plan or arrangement for the benefit of employees,
consultants or directors of the Company or its subsidiaries in effect on the
date of issuance hereof or thereafter adopted by the Board of Directors, or (ii)
pursuant to options, warrants and conversion rights in existence on the date of
issuance hereof or (iii) upon conversion of the Convertible Preferred Stock or
(iv) the sale of any additional shares of Convertible Preferred Stock.

         3.6 Notices of Record Date, Etc. In the event that:

         (1) the Company shall declare any cash dividend upon its Common Stock,
         or

         (2) the Company shall declare any dividend upon its Common Stock
         payable in stock or make any special dividend or other distribution to
         the holders of its Common Stock, or

         (3) the Company shall offer for subscription pro rata to the holders of
         its Common Stock any additional shares of stock of any class or other
         rights, or

         (4) there shall be any capital reorganization or reclassification of
         the capital stock of the Company, including any subdivision or
         combination of its outstanding shares of Common Stock, or consolidation
         or merger of the Company with, or sale of all or substantially all of
         its assets to, another corporation, or

         (5) there shall be a voluntary or involuntary dissolution, liquidation
         or winding up of the Company;

         then, in connection with such event, the Company shall give to the
         holder of this Warrant:

            (i) at least twenty (20) days' prior written notice of the date on
      which the books of the Company shall close or a record shall be taken for
      such dividend, distribution or subscription rights or for determining
      rights to vote in respect of any such reorganization, reclassification,
      consolidation, merger, sale, dissolution, liquidation or winding up; and

            (ii) in the case of any such reorganization, reclassification,
      consolidation, merger, sale, dissolution, liquidation or winding up, at
      least twenty (20) days, prior written notice of the date when the same
      shall take place. Such notice in accordance with the foregoing clause (i)
      shall also specify, in the case of any such dividend, distribution or
      subscription rights, the date on which the

                                      -9-
<PAGE>

      holders of Common Stock shall be entitled thereto, and such notice in
      accordance with the foregoing clause (ii) shall also specify the date on
      which the holders of Common Stock shall be entitled to exchange their
      Common Stock for securities or other property deliverable upon such
      reorganization, reclassification consolidation, merger, sale, dissolution,
      liquidation or winding up, as the case may be. Each such written notice
      shall be given by first class mail, postage prepaid, addressed to the
      holder of this Warrant at the address of such holder as shown on the books
      of the Company.

         3.7 Grant, Issue or Sale of Options, Convertible Securities, or Rights.
If at any time or from time to time on or after the date of issuance hereof, the
Company shall grant, issue or sell any Options, Convertible Securities or rights
to purchase property (the "Purchase Rights") pro rata to the record holders of
any class of Common Stock of the Company and such grants, issuances or sales do
not result in an adjustment of the Purchase Price under Paragraph 3.1 hereof,
then the holder of this Warrant shall be entitled to acquire (within thirty (30)
days after the later to occur of the initial exercise date of such Purchase
Rights or receipt by such holder of the notice concerning Purchase Rights to
which such holder shall be entitled under Paragraph 3.6) and upon the terms
applicable to such Purchase Rights either:

            (i) the aggregate Purchase Rights which such holder could have
      acquired if it had held the number of shares of Common Stock acquirable
      upon exercise of this Warrant immediately before the grant, issuance or
      sale of such Purchase Rights; provided that if any Purchase Rights were
      distributed to holders of Common Stock without the payment of additional
      consideration by such holders, corresponding Purchase Rights shall be
      distributed to the exercising holder of this Warrant as soon as possible
      after such exercise and it shall not be necessary for the exercising
      holder of this Warrant specifically to request delivery of such rights; or

            (ii) in the event that any such Purchase Rights shall have expired
      or shall expire prior to the end of said thirty (30) day period, the
      number of shares of Common Stock or the amount of property which such
      holder could have acquired upon such exercise at the time or times at
      which the Company granted, issued or sold such expired Purchase Rights.

         3.8 Adjustment by Board of Directors. If any event occurs as to which,
in the opinion of the Board of Directors of the Company, the provisions of this
Section 3 are not strictly applicable or if strictly applicable would not fairly
protect the rights of the holder of this Warrant in accordance with the
essential intent and principles of such provisions, then the

                                      -10-
<PAGE>

Board of Directors shall make an adjustment in the application of such
provisions, in accordance with such essential intent and principles, so as to
protect such rights as aforesaid, but in no event shall any adjustment have the
effect of increasing the Purchase Price as otherwise determined pursuant to any
of the provisions of this Section 3 except in the case of a combination of
shares of a type contemplated in Paragraph 3.3 and then in no event to an amount
larger than the Purchase Price as adjusted pursuant to Paragraph 3.3.

         3.9 Fractional Shares. The Company shall not issue fractions of shares
of Common Stock upon exercise of this Warrant or scrip in lieu thereof. If any
fraction of a share of Common Stock would, except for the provisions of this
Paragraph 3.9, be issuable upon exercise of this Warrant, the Company shall in
lieu thereof pay to the person entitled thereto an amount in cash equal to the
current value of such fraction, calculated to the nearest one-hundredth (1/100)
of a share, to be computed (i) if the Common Stock is listed on any national
securities exchange on the basis of the last sales price of the Common Stock on
such exchange (or the quoted closing bid price if there shall have been no
sales) on the date of conversion, or (ii) if the Common Stock shall not be
listed, on the basis of the mean between the closing bid and asked prices for
the Common Stock on the date of conversion as reported by NASDAQ, or its
successor, and if there are not such closing bid and asked prices, on the basis
of the fair market value per share as determined by the Board of Directors of
the Company.

         3.10 Officers' Statement as to Adjustments. Whenever the Purchase Price
shall be adjusted as provided in Section 3 hereof, the Company shall forthwith
file at each office designated for the exercise of this Warrant, a statement,
signed by the Chairman of the Board, the President, any Vice President or
Treasurer of the Company, showing in reasonable detail the facts requiring such
adjustment and the Purchase Price that will be effective after such adjustment.
The Company shall also cause a notice setting forth any such adjustments to be
sent by mail, first class, postage prepaid, to the record holder of this Warrant
at his or its address appearing on the stock register. If such notice relates to
an adjustment resulting from an event referred to in Paragraph 3.6, such notice
shall be included as part of the notice required to be mailed and published
under the provisions of Paragraph 3.6 hereof.

         4. NO DILUTION OR IMPAIRMENT. The Company will not, by amendment of its
charter or through reorganization, consolidation, merger, dissolution, sale of
assets or any other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Warrant, but will at all times in good
faith assist in the carrying out of all such terms and in the taking of all such
action as may be necessary or appropriate in order to protect the rights of the
holder hereof against dilution or other impairment. Without limiting the

                                      -11-
<PAGE>

generality of the foregoing, the Company will not increase the par value of any
shares of stock receivable upon the exercise of this Warrant above the amount
payable therefor upon such exercise, and at all times will take all such action
as may be necessary or appropriate in order that the Company may validly and
legally issue fully paid and non-assessable stock upon the exercise of this
Warrant.

         5. RESERVATION OF STOCK, ETC., ISSUABLE ON EXERCISE OF WARRANTS. The
Company shall at all times reserve and keep available out of its authorized but
unissued stock, solely for the issuance and delivery upon the exercise of this
Warrant and other similar Warrants, such number of its duly authorized shares of
Common Stock as from time to time shall be issuable upon the exercise of this
Warrant and all other similar Warrants at the time outstanding.

         6. REPLACEMENT OF WARRANT. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement (with surety if reasonably required) in an amount reasonably
satisfactory to it, or (in the case of mutilation) upon surrender and
cancellation thereof, the Company will issue, in lieu thereof, a new Warrant of
like tenor.

         7. REMEDIES. The Company stipulates that the remedies at law of the
holder of this Warrant in the event of any default by the Company in the
performance of or compliance with any of the terms of this Warrant are not and
will not be adequate, and that the same may be specifically enforced.

         8. NEGOTIABILITY, ETC. This Warrant is issued upon the following terms,
to all of which each taker or owner hereof consents and agrees:

         (a)      Subject to the legend appearing on the first page hereof,
                  title to this Warrant may be transferred by endorsement (by
                  the holder hereof executing the form of assignment at the end
                  hereof including guaranty of signature) and delivery in the
                  same manner as in the case of a negotiable instrument
                  transferable by endorsement and delivery.

         (b)      Any person in possession of this Warrant properly endorsed is
                  authorized to represent himself as absolute owner hereof and
                  is granted power to transfer absolute title hereto by
                  endorsement and delivery hereof to a bona fide purchaser
                  hereof for value; each prior taker or owner waives and
                  renounces all of his equities or rights in this Warrant in
                  favor of every such bona fide purchaser, and every such bona
                  fide purchaser

                                      -12-
<PAGE>

                  shall acquire title hereto and to all rights represented
                  hereby.

         (c)      Until this Warrant is transferred on the books of the Company,
                  the Company may treat the registered holder of this Warrant as
                  the absolute owner hereof for all purposes without being
                  affected by any notice to the contrary.

         (d)      Prior to the exercise of this Warrant, the holder hereof shall
                  not be entitled to any rights of a shareholder of the Company
                  with respect to shares for which this Warrant shall be
                  exercisable, including, without limitation, the right to vote,
                  to receive dividends or other distributions or to exercise any
                  preemptive rights, and shall not be entitled to receive any
                  notice of any proceedings of the Company, except as provided
                  herein.

         (e)      The Company shall not be required to pay any Federal or state
                  transfer tax or charge that may be payable in respect of any
                  transfer involved in the transfer or delivery of this Warrant
                  or the issuance or conversion or delivery of certificates for
                  Common Stock in a name other than that of the registered
                  holder of this Warrant or to issue or deliver any certificates
                  for Common Stock upon the exercise of this Warrant until any
                  and all such taxes and charges shall have been paid by the
                  holder of this Warrant or until it has been established to the
                  Company's satisfaction that no such tax or charge is due.

         9. SUBDIVISION OF RIGHTS. This Warrant (as well as any new Warrants
issued pursuant to the provisions of this paragraph) is exchangeable, upon the
surrender hereof by the holder hereof, at the principal office of the Company
for any number of new Warrants of like tenor and date representing in the
aggregate the right to subscribe for and purchase the number of shares of Common
Stock of the Company which may be subscribed for and purchased hereunder.

         10. MAILING OF NOTICES, ETC. All notices and other communications from
the Company to the holder of this Warrant shall be mailed by first-class
certified mail, postage prepaid, to the address furnished to the Company in
writing by the last holder of this Warrant who shall have furnished an address
to the Company in writing.

         11. HEADINGS, ETC. The headings in this Warrant are for purposes of
reference only, and shall not limit or otherwise affect the meaning hereof.

                                      -13-
<PAGE>

         12. CHANGE, WAIVER, ETC. Neither this Warrant nor any term hereof may
be changed, waived, discharged or terminated orally but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.

         13. GOVERNING LAW. THIS WARRANT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS.

                                           WORKSCAPE, INC.

                                           By   /s/ James G. Carlson
                                              ------------------------------

Dated:  July __, 1999

Attest:

   /s/ Mary Lee Praetz
-----------------------------

<PAGE>

                  [To be signed only upon exercise of Warrant]

To Workscape, Inc.

         The undersigned, the holder of the within Warrant, hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, ________ shares of Common Stock of Workscape Inc. and
herewith makes payment of $________ therefor, and requests that the certificates
for such shares be issued in the name of, and be delivered to _______________,
whose address is _________________.

Dated:

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

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

                                                        ----------------------
                                                                 Address

<PAGE>

                  [To be signed only upon transfer of Warrant]

         FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ________________________________ the right represented by the within
Warrant to purchase the __________ shares of the Common Stock of Workscape, Inc.
to which the within Warrant relates, and appoints
_________________________________ attorney to transfer said right on the books
of [Name of Company] with full power of substitution in the premises.

Dated:

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

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

                                                         ----------------------
                                                                Address

In the presence of

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

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