Document:

NEITHER  THIS WARRANT NOR THE SHARES  ISSUABLE  UPON  EXERCISE  HEREOF HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE  "SECURITIES  ACT")
OR ANY OTHER  STATE  SECURITIES  LAWS IN  RELIANCE  UPON AN  EXEMPTION  FROM THE
REGISTRATION  REQUIREMENTS  OF THE SECURITIES  ACT AND SUCH OTHER LAWS.  NEITHER
THIS WARRANT NOR THE SHARES ISSUABLE UPON EXERCISE HEREOF MAY BE SOLD,  PLEDGED,
TRANSFERRED, ENCUMBERED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT AND SUCH  STATE LAWS OR IN A
TRANSACTION  WHICH IS  EXEMPT  FROM  REGISTRATION  UNDER THE  PROVISIONS  OF THE
SECURITIES ACT AND SUCH LAWS.

                             STOCK PURCHASE WARRANT

                   To Purchase _____ Shares of Common Stock of

                               SEDONA CORPORATION

                  THIS CERTIFIES  that, for value received,  _____________  (the
"Holder"), is entitled, upon the terms and subject to the conditions hereinafter
set forth,  at any time on or after  February  28, 2000 (the  "Initial  Exercise
Date")  and on or prior to the  close of  business  on  February  28,  2003 (the
"Termination  Date") but not  thereafter,  to subscribe  for and  purchase  from
Sedona Corporation,  a corporation incorporated in Pennsylvania (the "Company"),
up to  __________________  shares (the "Warrant Shares") of Common Stock,  $.001
par value, of the Company (the "Common Stock").  The purchase price of one share
of Common Stock (the "Exercise  Price") under this Warrant shall be $5.037 (130%
of the  closing  bid price of the Common  Stock on the  Principal  Market on the
Closing Date). The Exercise Price and the number of shares for which the Warrant
is exercisable  shall be subject to adjustment as provided herein.  In the event
of any conflict between the terms of this Warrant and the Convertible  Preferred
Stock and Warrants  Purchase  Agreement  dated  February 25, 2000 (the "Purchase
Agreement"),  the Purchase  Agreement shall control.  Capitalized terms used and
not otherwise defined herein shall have the meanings set forth for such terms in
the Purchase Agreement.

<PAGE>

     1.   Title to Warrant.  Prior to the  Termination  Date and subject to
compliance with applicable laws, this Warrant and all rights hereunder are
transferable, in whole or in part, at the office or agency of the Company by the
holder hereof in person or by duly authorized  attorney,  upon surrender of this
Warrant together with the Assignment Form annexed hereto properly endorsed.

     2.   Authorization  of Shares.  The Company  covenants  that all shares of
Common Stock  which may be issued  upon the exercise  of  rights represented  by
this Warrant will, upon exercise of the rights represented by this Warrant,  be
duly authorized, validly issued, fully paid and nonassessable  and free from all
taxes,  liens and charges in respect of the issue  thereof  (other than taxes in
respect  of any  transfer  occurring  contemporaneously  with  such  issue).  3.
Exercise  of Warrant.  Except as  provided in Section 4 herein,  exercise of the
purchase rights  represented by this Warrant may be made at any time or times on
or after the  Initial  Exercise  Date,  and before the close of  business on the
Termination  Date by the  surrender  of this  Warrant and the Notice of Exercise
Form annexed hereto duly  executed,  at the office of the Company (or such other
office or agency of the Company as it may  designate by notice in writing to the
registered holder hereof at the address of such holder appearing on the books of
the  Company)  and upon  payment of the  Exercise  Price of the  shares  thereby
purchased by wire transfer or cashier's check drawn on a United States bank, the
holder of this Warrant shall be entitled to receive a certificate for the number
of  shares of Common  Stock so  purchased.  Certificates  for  shares  purchased
hereunder  shall be delivered to the holder hereof within three (3) Trading Days
after the date on which this Warrant  shall have been  exercised  as  aforesaid.
This Warrant  shall be deemed to have been  exercised  and such  certificate  or
certificates shall be deemed to have been issued, and Holder or any other person
so  designated  to be named  therein  shall be deemed to have become a holder of
record of such  shares for all  purposes,  as of the date the  Warrant  has been
exercised by payment to the Company of the Exercise Price and all taxes required
to be paid by Holder,  if any,  pursuant  to Section 5 prior to the  issuance of
such shares,  have been paid. If this Warrant shall have been exercised in part,
the Company shall,  at the time of delivery of the  certificate or  certificates
representing  Warrant  Shares,  deliver to Holder a new Warrant  evidencing  the
rights of Holder to purchase the  unpurchased  shares of Common Stock called for
by this Warrant, which new Warrant shall in all other respects be identical with
this Warrant.  . If there is no registration in effect  permitting the resale by
the  Holder of the  Warrant  Shares at any time from and after one year from the
issuance  date of this  Warrant,  then the  Holder  shall  have  the  right to a
"cashless  exercise"  in  which  the  Holder  shall be  entitled  to  receive  a
certificate for the number of shares equal to the quotient  obtained by dividing
[(A-B) (X)] by (A), where:

(A) = the average of the high and low trading  prices per share of Common  Stock
on the Trading Day preceding the date of such election;

(B) = the Exercise Price of the Warrant; and

(X) = the number of shares  issuable  upon exercise of the Warrant in accordance
with the terms of this Warrant.

     4.   No Fractional  Shares or Scrip.  No fractional  shares or scrip
representing fractional  shares shall be issued upon the exercise of this
Warrant.  As to any fraction of a share which  Holder would  otherwise be
entitled to purchase  upon such exercise,  the Company shall pay a cash
adjustment in respect of such final fraction in an amount equal to the Exercise
Price.

     5.   Charges,  Taxes and Expenses.  Issuance of certificates for shares of
Common Stock upon the exercise of this  Warrant shall be made without charge to
the holder  hereof for any issue or transfer  tax or other incidental expense in
respect of the  issuance of such  certificate,  all of which taxes and  expenses
shall be paid by the Company,  and such certificates shall be issued in the name
of the holder of this Warrant or in such name or names as may be directed by the
holder of this Warrant;  provided,  however,  that in the event certificates for
shares of Common  Stock  are to be issued in a name  other  than the name of the
holder of this  Warrant,  this Warrant when  surrendered  for exercise  shall be
accompanied by the Assignment  Form attached  hereto duly executed by the holder
hereof; and the Company may require,  as a condition  thereto,  the payment of a
sum  sufficient  to reimburse it for any transfer  tax  incidental  thereto.

     6.   Closing of Books. The Company will not close its shareholder books or
records in any manner which  prevents the timely  exercise of this  Warrant.

     7.   Transfer,Division and Combination.  (a) Subject to compliance with any
applicable securities laws,  transfer of this  Warrant and all rights hereunder,
in  whole  or in part,  shall  be registered  on the books of the  Company to be
maintained for such  purpose,  upon  surrender of this Warrant at the  principal
office of the Company, together with a written assignment of this Warrant
substantially in the form attached hereto duly executed by Holder or its agent
or attorney and funds sufficient to pay any transfer taxes payable upon the
making of such  transfer.  Upon such surrender and, if required, such payment,
the Company shall executeand deliver a new Warrant or Warrants in the name of
the assignee or assignees and in the denomination or denominations specified  in
such  instrument  of assignment, and shall issue to the assignor a new Warrant
evidencing the portion of this Warrant not so assigned, and this Warrant shall
promptly be cancelled. A Warrant, if properly assigned, may be exercised by a
new holder for the purchase of shares of Common Stock without having a new
Warrant issued.

       (b)  This Warrant may be divided or combined with other  Warrants upon
presentation hereof at the aforesaid  office of the Company,  together with a
written  notice specifying the names and denominations in which new Warrants are
to be issued, signed by Holder or its agent or attorney.  Subject to  compliance
with Section 7(a), as to any transfer which may be involved in such division or
combination, the Company  shall execute and deliver a new Warrant or Warrants in
exchange for the  Warrant or  Warrants  to be divided or  combined in accordance
with such notice.

          (c)  The Company shall  prepare,  issue and deliver at its own expense
(other than transfer taxes) the new Warrant or Warrants under this Section 7.

          (d)  The Company agrees to maintain, at its aforesaid office, books
for the registration and the registration of transfer of the Warrants.

     8.   No Rights as Shareholder until Exercise. This Warrant does not entitle
the holder  hereof to any  voting rights or other rights as a shareholder of the
Company prior to the exercise hereof. Upon the surrender of this Warrant and the
payment of the aggregate  Exercise Price,  the Warrant Shares so purchased shall
be and be deemed to be issued to such holder as the record  owner of such shares
as of the  close of  business  on the  later of the  date of such  surrender  or
payment.

     9.   Loss,  Theft,  Destruction  or  Mutilation  of  Warrant.  The  Company
covenants that upon receipt by the Company  of evidence reasonably  satisfactory
to it of the loss, theft,  destruction or mutilation of this Warrant certificate
or any stock certificate relating to the  Warrant Shares,  and  in case of loss,
theft or destruction,  of indemnity  or  security reasonably satisfactory  to it
(which  shall  not  include  the posting of any bond),  and  upon surrender  and
cancellation  of such  Warrant or stock  certificate,  if mutilated, the Company
will make and deliver a new  Warrant or  stock  certificate  of like  tenor  and
dated as of such cancellation,  in lieu of such  Warrant  or stock  certificate.

     10.  Saturdays, Sundays, Holidays, etc.  If the last or  appointed  day for
the  taking of any action or the  expiration  of any right  required  or granted
herein  shall be a Saturday, Sunday or a legal holiday, then such action may  be
taken or such right may be  exercised on the next succeeding day not a Saturday,
Sunday or legal holiday.

     11.  Adjustments of Exercise Price and Number of Warrant Shares.  (a) Stock
Splits, etc.  The number and kind of securities purchasable upon the exercise of
this Warrant and the Exercise Price shall be subject to adjustment from  time to
time  upon  the  happening  of any of the  following.  In case the Company shall
(i)  pay a dividend in shares of Common Stock or make a distribution  in  shares
of Common Stock to holders of its outstanding Common Stock,  (ii) subdivide  its
outstanding  shares of Common Stock into a greater number of  shares  of  Common
Stock,  (iii) combine its outstanding shares  of  Common Stock  into  a  smaller
number of shares of Common  Stock or (iv)  issue any shares of its capital stock
in a reclassification  of the Common Stock,  then the number  of  Warrant Shares
purchasable upon exercise of this Warrant  immediately  prior  thereto  shall be
adjusted so that the holder of this Warrant  shall be entitled to  receive   the
kind and number of Warrant  Shares or other  securities  of  them Company  which
he would have  owned or have been  entitled  to  receive  had  such Warrant been
exercised in advance thereof. Upon each such adjustment of  the kind and  number
of  Warrant  Shares or other  securities  of the  Company  which are purchasable
hereunder,  the holder of this Warrant shall thereafter be  entitled to purchase
the number of Warrant Shares or other securities resulting from  such adjustment
at  an  Exercise  Price  per  Warrant  Share  or  other  security  obtained   by
multiplying the Exercise Price in effect immediately prior to such adjustment by
the number of Warrant Shares  purchasable  pursuant hereto  immediately prior to
such adjustment and dividing by the number of Warrant Shares or other securities
of the Company  resulting from such  adjustment.  An adjustment made pursuant to
this paragraph shall become  effective  immediately  after the effective date of
such event retroactive to the record date, if any, for such event.

          (b)  Reorganization,  Reclassification,  Merger,  Consolidation or
Disposition of Assets.  In case the Company shall  reorganize  its capital,
reclassify  its capital stock, consolidate or merge with or into another
corporation (where the Company is not the surviving  corporation  or where there
is a change in or distribution with respect to the Common Stock of the Company),
or sell, transfer or otherwise dispose of all or substantially all its property,
assets or business to another  corporation  and,  pursuant to the terms  of such
reorganization,  reclassification,  merger,  consolidation  or  disposition   of
assets, shares of common stock of the successor or acquiring corporation, or any
cash,  shares  of stock or other securities or property of any nature whatsoever
(including warrants or other subscription or purchase  rights) in addition to or
in lieu of common  stock  of  the successor  or  acquiring  corporation  ("Other
Property"), are to be received  by or distributed to the holders of Common Stock
of the Company,  then Holder shall  have  the right thereafter to receive,  upon
exercise of this Warrant, the number of shares of common stock of the  successor
or acquiring  corporation or of the Company, if it is the surviving corporation,
and  Other  Property  receivable  upon  or  as a  result of such reorganization,
reclassification,  merger, consolidation or disposition of assets by a holder of
the number of  shares  of  Common  Stock  for  which this Warrant is exercisable
immediately  prior  to  such  event.   In  case  of  any  such   reorganization,
reclassification, merger, consolidation or disposition of assets,  the successor
or acquiring  corporation (if other than the Company) shall expressly assume the
due and punctual  observance  and performance  of  each  and  every covenant and
condition of this Warrant  to  be  performed and observed by the Company and all
the obligations and liabilities hereunder,  subject to such modifications as may
be deemed appropriate (as determined in good faith by resolution of the Board of
Directors  of the  Company)  in  order  to provide for adjustments  of shares of
Common  Stock for which this  Warrant  is  exercisable  which shall be as nearly
equivalent as practicable to the adjustments  provided   for in this Section 11.
For purposes of this  Section 11,  "common  stock of the  successor or acquiring
corporation"  shall include stock of  such corporation of any class which is not
preferred as to dividends or assets  over  any  other  class  of  stock  of such
corporation  and which is not subject to redemption  and shall also include  any
evidences of indebtedness,  shares  of  stock  or  other  securities  which  are
convertible  into or exchangeable for any such stock, either immediately or upon
the arrival of a specified  date or the  happening of a specified  event and any
warrants or other  rights to subscribe  for or  purchase  any  such  stock.  The
foregoing  provisions  of  this Section 11  shall  similarly apply to successive
reorganizations,  reclassifications,  mergers,  consolidations or disposition of
assets.

     12. Voluntary Adjustment by the Company. The Company may at any time during
the term of this Warrant,  reduce the then current  Exercise Price to any amount
and for any period of time deemed  appropriate  by the Board of Directors of the
Company.

     13.  Notice of Adjustment.  Whenever the number of Warrant Shares or number
or kind of securities or other property  purchasable  upon the  exercise of this
Warrant or the Exercise Price is adjusted, as herein provided, the Company shall
promptly mail by registered or certified mail, return receipt requested,  to the
holder of this Warrant notice of such  adjustment or  adjustments  setting forth
the number of Warrant Shares (and other securities or property) purchasable upon
the exercise of this Warrant and the Exercise  Price of such Warrant Shares (and
other  securities  or property)  after such  adjustment,  setting  forth a brief
statement  of  the  facts  requiring  such  adjustment  and  setting  forth  the
computation by which such  adjustment was made.  Such notice,  in the absence of
manifest  error,  shall  be  conclusive  evidence  of the  correctness  of  such
adjustment.

     14.  Notice of Corporate Action. If at any time:

          (a)  the  Company  shall take a record of the  holders  of its Common
Stock for the purpose of entitling  them to receive a dividend or other
distribution,  or any right to subscribe for or purchase any evidences of its
indebtedness, any shares of stock of any class or any other securities or
property,  or to receive any other right, or

     (b)  there shall be any capital  reorganization of the Company, any
reclassification or  recapitalization of the capital stock of the Company or any
consolidation or merger of the Company with, or any sale, transfer or other
disposition of all or substantially  all the property, assets or business of the
Company to,  another corporation or,

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

then, in any one or more of such cases,  the Company shall give to Holder (i) at
least 30 days' prior written  notice of the date on which a record date shall be
selected for such dividend,  distribution or right or for determining  rights to
vote  in  respect  of  any  such   reorganization,   reclassification,   merger,
consolidation, sale, transfer, disposition,  liquidation or winding up, and (ii)
in the case of any such reorganization, reclassification, merger, consolidation,
sale, transfer, disposition, dissolution, liquidation or winding up, at least 30
days'  prior  written  notice of the date when the same shall take  place.  Such
notice in accordance  with the foregoing  clause also shall specify (i) the date
on which  any such  record  is to be taken  for the  purpose  of such  dividend,
distribution  or right,  the date on which the holders of Common  Stock shall be
entitled  to any such  dividend,  distribution  or  right,  and the  amount  and
character  thereof,  and  (ii)  the  date  on  which  any  such  reorganization,
reclassification,    merger,   consolidation,   sale,   transfer,   disposition,
dissolution,  liquidation  or winding  up is to take place and the time,  if any
such  time is to be fixed,  as of which the  holders  of Common  Stock  shall be
entitled  to  exchange  their  shares of Common  Stock for  securities  or other
property deliverable upon such disposition,  dissolution, liquidation or winding
up. Each such written notice shall be sufficiently  given if addressed to Holder
at the  last  address  of  Holder  appearing  on the  books of the  Company  and
delivered in accordance with Section 16(d).

     15.  Authorized  Shares. The Company covenants that during the period the
Warrant is outstanding,  it will reserve from its authorized and unissued Common
Stock a sufficient  number of shares to provide for the  issuance of the Warrant
Shares upon the exercise of any purchase rights under this Warrant. The Company
further covenants that its issuance of this Warrant shall  constitute  full
authority to its officers who are charged with the duty of executing  stock
certificates  to execute and issue the  necessary  certificates  for the Warrant
Shares upon the exercise of the purchase rights under this Warrant.  The Company
will take all such  reasonable  action as may be necessary to assure that such
Warrant  Shares may be issued as provided  herein  without  violation of any
applicable  law or regulation, or of any requirements of the Principal Market
upon which the Common Stock may be listed.

          The  Company shall not by any  action, including,  without limitation,
amending  its certificate of incorporation or through any reorganization,
transfer of assets, consolidation,  merger,  dissolution,  issue or sale of
securities or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms 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  actions as may be necessary or  appropriate  to protect the rights of
Holder against impairment.  Without limiting  the generality  of the  foregoing,
the Company will (a) not increase  the par  value of any shares  of Common Stock
receivable  upon the exercise of this Warrant above the amount  payable therefor
upon such exercise immediately prior to such increase in par value, (b) take all
such action as may be  necessary or  appropriate  in order that the Company may
validly and legally issue fully paid and  nonassessable  shares of Common Stock
upon the exercise of this  Warrant,  and (c) use its best efforts to obtain all
such  authorizations, exemptions  or consents  from any public  regulatory  body
having jurisdiction thereof as may be necessary to enable the Company to perform
its  obligations under this Warrant.

          Upon the request of  Holder, the Company will at any time  during  the
period  this Warrant is outstanding  acknowledge in writing, in form reasonably
satisfactory to Holder,  the continuing  validity of this Warrant and the
obligations of the Company hereunder.

          Before taking any action which would cause an adjustment  reducing the
current Exercise Price below the then par value, if any, of the shares of Common
Stock  issuable upon exercise of the Warrants, the Company shall take any
corporate action which may be necessary  in order that the Company may validly
and legally  issue fully paid and  non-assessable shares of such Common Stock at
such adjusted  Exercise Price.

          Before  taking any action  which would result in an adjustment  in the
number of shares of Common Stock for which this Warrant is exercisable or in the
Exercise  Price, the Company shall obtain all such authorizations or  exemptions
thereof,  or consents thereto,  as may be necessary from any public regulatory
body or bodies having jurisdiction thereof.

     16.  Miscellaneous.

          (a)  Jurisdiction.  This Warrant shall be binding upon any successors
or assigns of the Company.  This Warrant shall  constitute a contract under the
laws of New York without regard to its conflict of law, principles or rules, and
be subject to arbitration pursuant to the terms set forth in the Purchase
Agreement.

          (b)  Restrictions.  The  holder hereof  acknowledges that the  Warrant
Shares acquired  upon the  exercise  of this  Warrant,  if not  registered, will
have restrictions  upon resale  imposed by state and  federal  securities  laws.

          (c)  Nonwaiver and Expenses.  No course of dealing or any delay or
failure to exercise any right  hereunder  on the part of Holder  shall  operate
as a  waiver of such right or otherwise prejudice  Holder's rights,  powers or
remedies, notwithstanding  all rights hereunder  terminate on the Termination
Date. If the Company fails to comply with any  provision of this  Warrant,  the
Company shall pay to  Holder  such  amounts as shall be  sufficient to cover any
costs and expenses including,  but not limited to, reasonable  attorneys' fees,
including those of appellate proceedings, incurred by Holder in collecting any
amounts due pursuant hereto or in otherwise enforcing any of its rights,  powers
or remedies hereunder.

          (d)  Notices.  Any  notice,  request or other  document  required or
permitted to be given or delivered to the holder  hereof by the Company shall be
delivered in accordance  with the notice  provisions of the Purchase  Agreement.

          (e)  Limitation of Liability.  No provision hereof, in the absence of
affirmative action by Holder to purchase shares of Common Stock,  and no
enumeration  herein of the rights or privileges of Holder  hereof,  shall give
rise to any liability of Holder for the purchase price of any Common Stock or as
a stockholder of the Company,  whether such liability is asserted by the Company
or by creditors of the Company.
          (f)  Remedies. Holder, in addition to being entitled to exercise all
rights  granted by law,  including  recovery  of  damages,  will be  entitled to
specific  performance of its rights under this Warrant.  The Company agrees that
monetary  damages  would not be adequate  compensation  for any loss incurred by
reason of a breach by it of the  provisions of this Warrant and hereby agrees to
waive the defense in any action for  specific  performance  that a remedy at law
would be adequate.
          (g)  Successors and Assigns.  Subject to applicable securities laws,
this Warrant and the rights and obligations evidenced  hereby shall inure to the
benefit of and be binding upon the  successors of the Company and the successors
and permitted assigns of Holder.  The provisions of this Warrant are intended to
be for the benefit of all Holders from time to time of this Warrant and shall be
enforceable  by any such Holder or holder of Warrant  Shares.

          (h)  Indemnification.  The Company agrees to indemnify and hold
harmless Holder from and against any liabilities, obligations,  losses, damages,
penalties, actions, judgments,  suits, claims, costs, attorneys' fees, expenses
and disbursements of any kind which may be imposed upon, incurred by or asserted
against  Holder in any manner  relating  to or arising out of any failure by the
Company to perform or  observe  in  any  material   respect  any  of  its
covenants,   agreements, undertakings or obligations set forth in this Warrant;
provided, however, that the Company will not be liable  hereunder  to the extent
that any  liabilities, obligations,  losses, damages,  penalties,  actions,
judgments, suits, claims, costs, attorneys' fees, expenses or disbursements  are
found  in  a  final non-appealable  judgment by a court to have resulted  from
Holder's  negligence, bad faith or willful  misconduct  in  its  capacity  as  a
stockholder or warrantholder of the Company.

          (i)  Amendment.  This Warrant may be modified or amended or the
provisions hereof waived with the written consent of the Company and the Holder.

          (j)  Severability.  Wherever  possible, each provision of this Warrant
shall be  interpreted  in such manner as to be effective and valid under
applicable  law, but if any  provision of this Warrant shall be prohibited by or
invalid under  applicable law, such provision shall be ineffective to the extent
of such  prohibition or invalidity,  without  invalidating the remainder of such
provisions or the  remaining  provisions  of this  Warrant.  (k)  Headings.  The
headings  used in this Warrant are for the  convenience  of  reference  only and
shall not, for any purpose, be deemed a part of this Warrant.

          IN WITNESS WHEREOF,  the Company has caused this Warrant to be
executed by its officer thereunto duly authorized.

Dated:  February _____, 2000
                              SEDONA CORPORATION

                              By:_______________________________________
                                 Marco A. Emrich, President and CEO

<PAGE>

                               NOTICE OF EXERCISE

To:      SEDONA CORPORATION

          (1) The undersigned  hereby elects to purchase ________ shares of
Common  Stock (the "Common  Stock"),  of Sedona  Corporation  pursuant to the
terms of the  attached  Warrant,  and tenders  herewith  payment of the exercise
price in full, together with all applicable transfer taxes, if any.

          (2) Please issue a certificate  or  certificates  representing said
shares of Common Stock in the name of the undersigned or in such other name as
is specified below:

                      ____________________________________
                      (Name)

                      ____________________________________
                      (Address)

                      ____________________________________

Dated:

                                 _______________________________________
                                 Signature

<PAGE>
                                ASSIGNMENT FORM

                    (To assign the foregoing warrant, execute
                   this form and supply required information.
                      Do not use this form to exercise the
                                   warrant.)

          FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced
thereby are hereby assigned to

_______________________________________________ whose address is

_________________________________________________________________.

_________________________________________________________________

                                             Dated:  ______________, _______

                Holder's Signature: _____________________________

                Holder's Address: _______________________________

                                  _______________________________

Signature Guaranteed:  __________________________________________

NOTE: The signature to this  Assignment Form must correspond with the name as it
appears on the face of the Warrant,  without  alteration or  enlargement  or any
change whatsoever,  and must be guaranteed by a bank or trust company.  Officers
of  corporations  and  those  acting  in an  fiduciary  or other  representative
capacity  should  file  proper  evidence of  authority  to assign the  foregoing
Warrant.REGISTRATION RIGHTS AGREEMENT

                  THIS REGISTRATION  RIGHTS AGREEMENT,  dated as of February 25,
2000, between the investor or investors signatory hereto (each an "Investor" and
together the "Investors"),  and Sedona Corporation,  a Pennsylvania  corporation
(the "Company").

                  WHEREAS,  simultaneously  with the  execution  and delivery of
this  Agreement,  the Investor is  purchasing  from the  Company,  pursuant to a
Convertible  Preferred  Stock and  Warrants  Purchase  Agreement  dated the date
hereof  (the  "Purchase  Agreement"),  $3,000,000  Stated  Value of  Convertible
Preferred Stock and 100,000  Warrants to purchase shares of the Company's Common
Stock (terms not defined herein shall have the meanings  ascribed to them in the
Purchase Agreement); and

                  WHEREAS,  the Company  desires to grant to the  Investors  the
registration  rights set forth herein with respect to the  Conversion  Shares of
Common  Stock  issuable  upon  conversion  of the  Convertible  Preferred  Stock
purchased pursuant to the Purchase Agreement and shares of Common Stock issuable
upon  exercise  of the  Warrants  (hereinafter  referred  to as the  "Stock"  or
"Securities" of the Company).

                  NOW, THEREFORE, the parties hereto mutually agree as follows:

                  Section 1.  Registrable  Securities.  As used  herein the term
"Registrable Security" means the Securities until (i) the Registration Statement
has been declared  effective by the  Commission,  and all  Securities  have been
disposed of pursuant to the  Registration  Statement,  (ii) all Securities  have
been sold under  circumstances  under which all of the applicable  conditions of
Rule 144 (or any  similar  provision  then in force)  under the  Securities  Act
("Rule 144") are met,  (iii) all Securities  have been otherwise  transferred to
holders who may trade such Securities  without  restriction under the Securities
Act,  and the  Company  has  delivered a new  certificate  or other  evidence of
ownership for such Securities not bearing a restrictive legend or (iv) such time
as, in the opinion of counsel to the Company, all Securities may be sold without
any time, volume or manner  limitations  pursuant to Rule 144(k) (or any similar
provision  then in  effect)  under the  Securities  Act.  The term  "Registrable
Securities" means any and/or all of the securities  falling within the foregoing
definition   of  a   "Registrable   Security."  In  the  event  of  any  merger,
reorganization,  consolidation,  recapitalization  or other  change in corporate
structure affecting the Common Stock, such adjustment shall be deemed to be made
in the  definition  of  "Registrable  Security"  as is  appropriate  in order to
prevent  any  dilution or  enlargement  of the rights  granted  pursuant to this
Agreement.

                  Section   2.   Restrictions   on   Transfer.   Each   Investor
acknowledges and understands that prior to the registration of the Securities as
provided herein,  the Securities are "restricted  securities" as defined in Rule
144  promulgated  under the Securities  Act. Each Investor  understands  that no
disposition or transfer of the Securities may be made by Investor in the absence
of (i) an opinion of counsel to the Investor,  in form and substance  reasonably
satisfactory to the Company, that such transfer may be made without registration
under the Securities Act or (ii) such registration.

                           With a view to making available to the  Investors the
benefits  of  Rule  144 under  the  Securities  Act or any other similar rule or
regulation of the  Commission that may at any time permit the  Investors to sell
securities  of the Company to the public  without registration ("Rule 144"), the
Company agrees to:

                           (a) comply with the provisions of paragraph (c)(1) of
Rule 144; and

                           (b) file with the  Commission  in a timely manner all
reports and other documents required to be filed with  the  Commission  pursuant
to Section 13 or 15(d) under the  Exchange Act  by companies  subject  to either
of such  sections,  irrespective of  whether the Company is then subject to such
reporting requirements.

                  Section 3. Registration Rights With Respect to the Securities.

                           (a)      The  Company agrees that it will prepare and
file with the Securities and Exchange  Commission ("Commission"),  no later than
April 10, 2000  a  registration  statement  (on Form S-3,  or  other appropriate
registration  statement  form)  under  the  Securities  Act  (the  "Registration
Statement"),  at the sole expense of the Company (except as provided in  Section
3(c) hereof), in respect of the Investors, so as to permit a public offering and
resale of the Securities  under the Act by the Investors as selling stockholders
and not as underwriters.

                           The Company shall use its best  efforts to cause such
Registration Statement to become effective within one hundred  twenty (120) days
from the filing  date,  or, if earlier, within five (5) days of SEC clearance to
request  acceleration of effectiveness.  The number of shares  designated in the
Registration Statement to be registered shall include all the Warrant Shares, at
least two hundred percent (200%) of the shares  issuable upon the  conversion of
Series G  Convertible  Preferred  Stock  based  upon  the   Conversion  Price in
effect on  the date prior  to the filing  date issuable  upon conversion  of the
Convertible  Preferred  Stock, and shall include  appropriate language regarding
reliance upon Rule 416 to the extent permitted by the Commission.   The  Company
will notify the  Investors and its  transfer agent of  the  effectiveness of the
Registration  Statement within one Trading Day of such event.  In the event that
the number of shares so  registered  shall prove to be  insufficient to register
the  resale  of all of the  Securities,   then the Company shall be obligated to
to  file,  within thirty  (30)  days of  notice  from  any  Investor,  a further
Registration Statement registering such remaining shares and shall use  diligent
best  efforts   to  prosecute   such   additional   Registration   Statement  to
effectiveness within ninety (90) days of the date of such notice.

                           (b)  The  Company  will  maintain  the   Registration
Statement or post-effective amendment filed under this Section 3 effective under
the Securities Act until the earlier of (i) the date that none of the Securities
covered by such Registration Statement are or may become issued and outstanding,
(ii)  the date  that  all  of  the  Securities  have  been sold pursuant to such
Registration  Statement,   (iii)  the date the Investors receive  an  opinion of
counsel to the Company,   which counsel shall be  reasonably  acceptable  to the
Investors,  that the Securities may  be  sold  under  the provisions of Rule 144
without  limitation  as  to volume,  (iv)  all  Securities  have been  otherwise
transferred  to  persons  who may  trade  such  shares without restriction under
the  Securities  Act,  and  the  Company  has  delivered  a  new  certificate or
other  evidence of ownership for such  securities  not  bearing  a  restrictrive
legend,  (v)  all  Securities  may  be  sold  without any time, volume or manner
limitations  pursuant  to  Rule  144(k)  or   any  similar   provision  then  in
effect under the Securities Act in the opinion of counsel to the Company,  which
counsel  shall be  reasonably  acceptable  to the Investor  (the  "Effectiveness
Period"), or (vi) four (4) years from the Effective Date.

                           (c)      All fees,  disbursements  and  out-of-pocket
expenses  and costs  incurred by the Company in connection  with the preparation
and  filing  of  the  Registration  Statement  under  subparagraph  3(a)  and in
complying  with  applicable  securities  and  Blue  Sky laws (including, without
limitation,  all attorneys'  fees of the Company) shall be borne by the Company.
The Investors shall bear the cost of  underwriting  and/or  brokerage discounts,
fees and commissions, if any, applicable to the Securities being  registered and
the fees and expenses of their counsel.  The Investors and their  counsel  shall
have a reasonable  period,  not to exceed five  (5)  Trading Days, to review the
proposed  Registration  Statement or any amendment  thereto, including a copy of
the Company's proposed response to any staff comments, prior  to filing with the
Commission,   and  the Company  shall provide  each Investor  with copies of any
comment  letters  received  from  the  Commission  with  respect  thereto within
two  (2)  Trading  Days  of receipt  thereof  and  shall  communicate  any  oral
advice from the Commission as to whether or not the Registration  Statement will
be reviewed,  and if so, how  extensively.  The Company shall qualify any of the
securities  for sale in such states as any Investor  reasonably  designates  and
shall  furnish  indemnification  in the  manner  provided  in  Section 6 hereof.
However,  the  Company  shall not be required to qualify in any state which will
require  an escrow or other  restriction  relating  to the  Company  and/or  the
sellers,  or which will  require  the  Company to qualify to do business in such
state or require the Company to file  therein any general  consent to service of
process. The Company at its expense will supply the Investors with copies of the
applicable  Registration Statement and the prospectus included therein and other
related  documents  in such  quantities  as may be  reasonably  requested by the
Investors.

                           (d)      The  Company  shall  not be required by this
Section 3 to include an  Investor's  Securities  in any  Registration  Statement
which is to be filed if, in the opinion of counsel for both the Investor and the
Company  (or,  should  they  not  agree,  in  the  opinion  of  another  counsel
experienced in securities law matters acceptable to counsel for the Investor and
the  Company)   the  proposed  offering  or  other  transfer  as  to  which such
registration  is  requested  is  exempt   from   applicable  federal  and  state
securities  laws and would result in all  purchasers  or  transferees  obtaining
securities which are not "restricted  securities",  as defined in Rule 144 under
the Securities Act.

                           (e)      In  the  event  that  (i)  the  Registration
Statement  to be filed by the  Company  pursuant  to Section 3 (a)  above is not
filed with the Commission by April 10, 2000, (ii) such Registration Statement is
not declared effective by the Commission within 120 (5) days of clearance by the
Commission  to request effectiveness,  (iii) such Registration  Statement is not
maintained as effective  by the Company for the period set forth in Section 3(b)
above  or (iv) the additional Registration Statement referred to in Section 3(a)
is not filed within thirty (30) days or declared  effective  within  ninety (90)
days as set  forth therein (each a "Registration Default") then the Company will
pay Investor (pro  rated  on  a  daily  basis),  as liquidated  damages for such
failure and not as a penalty two percent (2%) of the  aggregate market  value of
shares  of  Common Stock  purchased  from  the Company (including the Conversion
Shares which would be issuable  upon  conversion  of the  Convertible  Preferred
Stock  on  any  date  of  determination,  and  whether  or  not the  Convertible
Preferred Shares are then Convertible  pursuant to their  terms) and held by the
Investor   for each  month thereafter until such Registration Statement has been
filed,  and in the event of  late  effectiveness  (in case of clause (ii) above)
or lapsed  effectiveness (in  the case of clause (iii) above),  two percent (2%)
of  the  aggregate  market value of shares of Common  Stock  purchased  from the
Company and held by the Investor  (including  the Conversion  Shares which would
be  issuable  upon  conversion of the Convertible Preferred Stock on any date of
determination,  and  whether  or  not  the Convertible  Preferred Stock are then
convertible  pursuant to their terms) for  each   month  thereafter  (regardless
of  whether  one  or  more  such  Registration Defaults  are then in  existence)
until such  Registration  Statement  has been declared effective.   Such payment
of  the liquidated  damages  shall be made to the Investors in cash, within five
(5)  calendar  days  of  demand,  provided,  however, that  the  payment of such
liquidated  damages  shall  not  relieve  the  Company from  its  obligations to
register  the Securities  pursuant  to  this  Section.   The market value of the
Common Stock for this purpose  shall be the closing  price (or last trade, if so
reported)  on the  Principal  Market  for  each  day  during  such  Registration
Default. Notwithstanding anything to the contrary contained herein, a failure to
maintain the  effectiveness of an filed  Registration  Statement or the  ability
of an Investor to use  an otherwise effective  Registration  Statement to effect
resales of  Securities  during the period after 45 days and within 90  days from
the end of the Company's fiscal  year resulting  solely  from the need to update
the Company's financial  statements contained or  incorporated  by  reference in
such Registration  Statement  shall not constitute a  Registration  Default  and
shall not trigger the accrual of liquidated damages hereunder.

                           If  the  Company  does  not  remit the payment to the
Investors  as set forth above,   the Company will pay  the Investors  reasonable
costs of collection,  including  attorneys'  fees, in addition to the liquidated
damages.  The registration of the Securities pursuant  to this  provision  shall
not  affect  or limit the  Investors'  other  rights or remedies as set forth in
this Agreement.

                           (f) No provision  contained herein shall preclude the
Company  from  selling securities pursuant to any  Registration  Statement  in
which it is  required  to  include  Securities pursuant to this Section 3.

                           (g) If at any  time or from  time to time  after  the
effective date of any Registration Statement, the Company notifies the Investors
in writing of the existence of a Potential Material Event (as defined in Section
3(h) below), the Investors shall not offer or sell any  Securities or engage  in
any other transaction  involving or relating to Securities, from the time of the
giving of notice with respect to a Potential  Material Event until the Investors
receive  written  notice from the Company that  such  Potential  Material  Event
either has been  disclosed  to  the public or no longer  constitutes a Potential
Material  Event;  provided,  however,  that  the  Company may not so suspend the
right to such  holders  of  Securities  for  more  than  twenty (20) days in the
aggregate  during any twelve month  period,  during the period the  Registration
Statement  is  required  to be in effect,  and if such period is exceeded,  such
event  shall  be a Registration  Default.  If a Potential  Material  Event shall
occur  prior to the  date  a  Registration  Statement  is  required to be filed,
then the Company's   obligation  to  file such  Registration Statement  shall be
delayed  without  penalty for not more than twenty (20) days, and such  delay or
delays  shall not  constitute  a  Registration  Default.  The  Company  must, if
lawful,  give the Investors  notice in writing at least two (2) Trading Days
prior to the first day of the blackout period.

                           (h) "Potential  Material  Event"  means  any  of  the
following:  (i) the possession by the Company of material  information  not ripe
for disclosure in a  registration  statement,  if determined  in good  faith  by
the  Chief  Executive  Officer  or  the  Board  of Directors of the Company;  or
(ii) any  material  engagement  or activity by the Company  which would,  in the
good faith  determination  of  the  Chief  Executive  Officer  or  the  Board of
Directors   of  the  Company,   be  adversely  affected   by   disclosure  in  a
registration  statement at such time, which  determination shall  be accompanied
by a good faith  determination by the Chief  Executive  Officer or the  Board of
Directors of the Company that  the applicable  Registration  Statement  would be
materially misleading absent the inclusion of such information.

                  Section  4.  Cooperation  with  Company.  The  Investors  will
cooperate  with the Company in all respects in connection  with this  Agreement,
including timely supplying all information  reasonably  requested by the Company
(which shall include all information regarding the Investors and proposed manner
of  sale  of  the  Registrable  Securities  required  to  be  disclosed  in  any
Registration  Statement)  and executing  and returning all documents  reasonably
requested  in  connection  with the  registration  and  sale of the  Registrable
Securities  and  entering  into  and  performing  their  obligations  under  any
underwriting  agreement,  if the offering is an underwritten  offering, in usual
and  customary  form,  with the managing  underwriter  or  underwriters  of such
underwritten offering.  Nothing in this Agreement shall obligate any Investor to
consent  to be  named  as an  underwriter  in any  Registration  Statement.  The
obligation  of the  Company to  register  the  Registrable  Securities  shall be
absolute and  unconditional  as to those  Securities  which the Commission  will
permit to be registered without naming the Investors as underwriters.  Any delay
or delays caused by the Investors by failure to cooperate as required  hereunder
shall not constitute a Registration Default.

                  Section  5.  Registration  Procedures.  If  and  whenever  the
Company is required by any of the  provisions  of this  Agreement  to effect the
registration  of any of the  Registrable  Securities  under the Act, the Company
shall (except as otherwise  provided in this  Agreement),  as  expeditiously  as
possible,  subject to the Investors'  assistance  and  cooperation as reasonably
required with respect to each Registration Statement:

                           (a)(i)  prepare  and  file with the  Commission  such
amendments and  supplements to  the  Registration  Statement  and the prospectus
used in connection therewith as  may  be  necessary  to keep  such  Registration
Statement effective and to comply with the provisions of the Act with respect to
the sale or other disposition of all securities  covered  by  such  registration
statement  whenever the Investors shall desire  to  sell or otherwise dispose of
the  same (including   prospectus  supplements  with  respect  to  the sales  of
securities  from  time  to  time  in  connection  with a  registration statement
pursuant  to  Rule  415  promulgated  under  the Act)  and  (ii) take all lawful
action such that each of  (A)  the  Registration  Statement  and  any  amendment
thereto does not, when it becomes  effective,  contain an untrue  statement of a
material fact or omit to state a material fact required to be stated  therein or
necessary to make the statements  therein,  in light of the circumstances  under
which they were made, not misleading and (B) the prospectus  forming part of the
Registration Statement, and any amendment or supplement thereto, does not at any
time during the  Registration  Period include an untrue  statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements  therein,  in light of the circumstances under which they
were made, not misleading;

                           (b) (i) prior to the filing  with the  Commission  of
any  Registration Statement (including any amendments   thereto)  and (including
the  distribution  or  delivery  of  any  prospectus any  supplements  thereto),
provide  draft  copies  thereof  to  the Investors  as required by Section  3(c)
and reflect in such  documents  all such comments as  the  Investors (and  their
counsel)  reasonably may propose respecting the Selling Shareholders and Plan of
Distribution  sections (or equivalents) and  (ii)  furnish to each Investor such
numbers  of copies  of  a  prospectus including a preliminary  prospectus or any
amendment or  supplement  to  any  prospectus,   as  applicable,  in  conformity
with the  requirements  of the Act,  and such other documents,  as such Investor
may  reasonably  request  in  order  to  facilitate  the  public  sale  or other
disposition of the securities owned by such Investor;

                           (c)      register   and   qualify   the   Registrable
Securities covered by the Registration  Statement under such other securities or
blue sky laws of such  jurisdictions  as the Investors shall  reasonably request
subject to the limitations set forth in Section 3(c) above),  and do any and all
other  acts and  things  which may be  necessary  or advisable  to  enable  each
Investor  to   consummate   the   public  sale  or  other  disposition  in  such
jurisdiction of the securities owned by such Investor;

                           (d) list such Registrable Securities on the Principal
Market, if the listing of such  Registrable Securities  is  then permitted under
the rules of such Principal Market;

                           (e)  notify   each   Investor  at  any  time  when  a
prospectus relating thereto covered by the Registration  Statement  is  required
to be  delivered  under  the Act,  of the happening  of any  event  of  which it
has knowledge  as a result of  which the prospectus included in the Registration
Statement,  as  then  in  effect, includes an  untrue  statement  of a  material
fact  or  omits to  state  a  material  fact  required  to be stated  therein or
necessary to make the  statements  therein  not misleading  in  the light of the
circumstances  then  existing,   and  the  Company  shall  prepare  and  file  a
curative  amendment  under  Section 5(a) as quickly as commercially possible;

                           (f) as promptly as  practicable  after becoming aware
of such event, notify each Investor who holds  Registrable Securities being sold
(or, in the event of an  underwritten offering,  the managing  underwriters)  of
the issuance by the Commission of any stop  order  or  other  suspension  of the
effectiveness  of  the  Registration Statement at the earliest possible time and
take  all  lawful action  to effect the withdrawal, recession or removal of such
stop order or other suspension;

                           (g)      cooperate  with  the Investors to facilitate
the  timely   preparation  and  delivery  of certificates  for  the  Registrable
Securities  to be  offered  pursuant  to the Registration  Statement  and enable
such  certificates  for  the  Registrable Securities to be in such denominations
or amounts,  as the case may be,  as the  Investors  reasonably  may request and
registered in such names as the Investors may request;   and,  within  three (3)
Trading   Days   after  a  Registration  Statement  which  includes  Registrable
Securities  is  declared effective  by the Commission, deliver  and cause  legal
counsel  selected  by  the  Company  to  deliver  to  the transfer agent for the
Registrable  Securities   (with  copies  to  the  Investors)   an    appropriate
instruction  and,  to the  extent  necessary,  an  opinion  of such counsel;

                           (h) take all such  other  lawful  actions  reasonably
necessary to expedite and facilitate the disposition  by  the Investors of their
Registrable Securities in accordance with the intended methods therefor provided
in  the  prospectus  which  are  customary  for  issuers  to  perform  under the
circumstances;

                           (i)      in  the event of an  underwritten  offering,
promptly  include or incorporate in a prospectus  supplement  or  post-effective
amendment  to  the  Registration  Statement  such  information  as  the managers
reasonably  agree  should  be included therein and to which the Company does not
reasonably  object and make all required  filings of such prospectus  supplement
or  post-effective  amendment as soon as practicable after it is notified of the
matters to be  included  or  incorporated in such Prospectus supplement or post-
effective amendment; and

                           (j) maintain a transfer  agent and  registrar for its
Common Stock.

                  Section 6.  Indemnification.

                           (a)      To  the  maximum  extent  permitted  by law,
the  Company  agrees  to indemnify  and  hold  harmless the  Investors  and each
person,   if  any,   who  controls   an  Investor  within  the  meaning  of  the
Securities  Act (each  a   "Distributing  Investor") against any losses, claims,
damages  or  liabilities,   joint  or  several  (which  shall,  for all purposes
of this Agreement,  include,  but  not be limited to,  all reasonable  costs  of
defense  and  investigation  and  all reasonable  attorneys' fees and expenses),
to which the Distributing Investor may become subject,  under the Securities Act
or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in  respect  thereof)  arise out of or are based upon any  untrue  statement  or
alleged  untrue  statement of any material  fact  contained in any  Registration
Statement,  or any related final prospectus or amendment or supplement  thereto,
or arise out of or are based  upon the  omission  or alleged  omission  to state
therein a material fact  required to be stated  therein or necessary to make the
statements therein not misleading;  provided, however, that the Company will not
be liable in any such case to the extent, and only to the extent,  that any such
loss,  claim,  damage  or  liability  arises  out of or is based  upon an untrue
statement or alleged  untrue  statement or omission or alleged  omission made in
such  Registration  Statement,   preliminary  prospectus,  final  prospectus  or
amendment  or  supplement  thereto in reliance  upon,  and in  conformity  with,
written information furnished to the Company by the Distributing  Investor,  its
counsel, affiliates or any underwriter,  specifically for use in the preparation
thereof. This indemnity agreement will be in addition to any liability which the
Company may otherwise have.

                           (b) To the  maximum  extent  permitted  by law,  each
Distributing  Investor  agrees  that  it  will  indemnify  and hold harmless the
Company,  and  each officer  and  director  of  the  Company or person,  if any,
who  controls the Company  within the meaning of the Securities Act, against any
losses, claims, damages or liabilities (which shall, for all  purposes  of  this
Agreement,  include,  but  not be  limited  to,  all reasonable costs of defense
and investigation  and all reasonable attorneys' fees and expenses) to which the
Company  or any such officer,  director or controlling person may become subject
under the Securities Act or otherwise, insofar  as  such losses, claims, damages
or  liabilities  (or actions in respect thereof)  arise out of or are based upon
any untrue  statement or alleged untrue statement of any material fact contained
in any  Registration  Statement, or any related final prospectus or amendment or
supplement  thereto,  or arise out  of  or are based  upon the omission  or  the
alleged  omission  to  state  therein  a  material  fact  required  to be stated
therein or necessary to make the statements therein not misleading,  but in each
case  only  to  the  extent  that  such   untrue  statement  or  alleged  untrue
statement  or  omission  or  alleged  omission  was  made in  such  Registration
Statement, final prospectus or amendment or supplement thereto in reliance upon,
and in conformity  with,  written  information  furnished to the Company by such
Distributing Investor, its counsel, affiliates or any underwriter,  specifically
for use in the  preparation  thereof.  Notwithstanding  anything to the contrary
contained herein,  the Distributing  Investor shall be liable under this Section
6(b)  only  for  that  amount  as  does  not  exceed  the net  proceeds  to such
Distributing Investor as a result of the sale of Registrable Securities pursuant
to the Registration Statement.

                           (c) Promptly  after receipt by an  indemnified  party
under this Section 6 of notice of the commencement  of any  action  against such
indemnified  party,  such  indemnified party will, if a claim in respect thereof
is to be made against the indemnifying party  under this  Section 6,  notify the
indemnifying party in writing of the commencement  thereof; but the omission  so
to notify the indemnifying party will not relieve  the  indemnifying  party from
any liability which it may have to any
indemnified  party except to the extent the failure of the indemnified  party to
provide  such  written  notification  actually  prejudices  the  ability  of the
indemnifying  party to defend  such  action.  In case any such action is brought
against any indemnified  party,  and it notifies the  indemnifying  party of the
commencement thereof, the indemnifying party will be entitled to participate in,
and, to the extent that it may wish,  jointly with any other  indemnifying party
similarly notified, assume the defense thereof, subject to the provisions herein
stated and after notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof,  the indemnifying  party will not
be liable to such indemnified  party under this Section 6 for any legal or other
expenses  subsequently incurred by such indemnified party in connection with the
defense  thereof  other  than  reasonable  costs of  investigation,  unless  the
indemnifying  party  shall not pursue the  action to its final  conclusion.  The
indemnified  parties  as a group  shall  have the right to employ  one  separate
counsel in any such action and to  participate in the defense  thereof,  but the
fees  and  expenses  of  such  counsel  shall  not  be at  the  expense  of  the
indemnifying  party if the  indemnifying  party has  assumed  the defense of the
action with counsel reasonably  satisfactory to the indemnified party unless (i)
the  employment of such counsel has been  specifically  authorized in writing by
the indemnifying  party, or (ii) the named parties to any such action (including
any impleaded  parties) include both the indemnified  party and the indemnifying
party and the  indemnified  party shall have been  advised by its  counsel  that
there may be one or more legal  defenses  available  to the  indemnifying  party
different  from or in conflict with any legal defenses which may be available to
the  indemnified  party  or any  other  indemnified  party  (in  which  case the
indemnifying party shall not have the right to assume the defense of such action
on behalf of such  indemnified  party, it being  understood,  however,  that the
indemnifying party shall, in connection with any one such action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, be liable only for the reasonable
fees and expenses of one separate firm of attorneys for the  indemnified  party,
which  firm  shall be  designated  in  writing  by the  indemnified  party).  No
settlement of any action against an indemnified  party shall be made without the
prior  written  consent of the  indemnified  party,  which  consent shall not be
unreasonably  withheld  so long as such  settlement  includes a full  release of
claims against the indemnified  party.  All fees and expenses of the indemnified
party  (including  reasonable  fees  and  expenses  to the  extent  incurred  in
connection with investigating or preparing to defend such proceeding in a manner
not  inconsistent  with this Section) shall be paid to the indemnified  party as
incurred,  within  ten  (10)  Trading  Days of  written  notice  thereof  to the
indemnifying  party  (regardless of whether it is ultimately  determined that an
indemnified party is not entitled to  indemnification  hereunder;  provided that
the  indemnifying  party may require  such  indemnified  party to  undertake  to
reimburse  all such fees and  expenses  to the extent it is  finally  judicially
determined  that  such  indemnified  party is not  entitled  to  indemnification
hereunder).

                  Section  7.  Contribution.  In order to  provide  for just and
equitable  contribution  under the  Securities  Act in any case in which (i) the
indemnified party makes a claim for indemnification pursuant to Section 6 hereof
but is judicially  determined  (by the entry of a final  judgment or decree by a
court of  competent  jurisdiction  and the  expiration  of time to appeal or the
denial  of the last  right  of  appeal)  that  such  indemnification  may not be
enforced in such case  notwithstanding  the fact that the express  provisions of
Section 6 hereof provide for  indemnification in such case, or (ii) contribution
under the Securities Act may be required on the part of any  indemnified  party,
then the Company and the applicable  Distributing  Investor shall  contribute to
the  aggregate  losses,  claims,  damages  or  liabilities  to which they may be
subject (which shall,  for all purposes of this Agreement,  include,  but not be
limited to, all reasonable costs of defense and investigation and all reasonable
attorneys'  fees and  expenses),  in either such case (after  contribution  from
others) on the basis of relative fault as well as any other  relevant  equitable
considerations.  The relative  fault shall be  determined by reference to, among
other things,  whether the untrue or alleged untrue statement of a material fact
or the  omission  or  alleged  omission  to state a  material  fact  relates  to
information  supplied  by  the  Company  on  the  one  hand  or  the  applicable
Distributing  Investor  on the other hand,  and the  parties'  relative  intent,
knowledge,  access to  information  and  opportunity  to correct or prevent such
statement or omission.  The Company and the Distributing  Investor agree that it
would not be just and equitable if contribution  pursuant to this Section 7 were
determined by pro rata  allocation  or by any other method of  allocation  which
does  not take  account  of the  equitable  considerations  referred  to in this
Section 7. The amount paid or payable by an indemnified party as a result of the
losses,  claims, damages or liabilities (or actions in respect thereof) referred
to above in this  Section  7 shall  be  deemed  to  include  any  legal or other
expenses  reasonably  incurred  by such  indemnified  party in  connection  with
investigating  or  defending  any such  action  or claim.  No  person  guilty of
fraudulent  misrepresentation  (within  the  meaning  of  Section  11(f)  of the
Securities  Act) shall be entitled to  contribution  from any person who was not
guilty of such fraudulent misrepresentation.

Notwithstanding any other provision of this Section 7, in no event shall any (i)
Investor be required to  undertake  liability to any person under this Section 7
for any amounts in excess of the dollar amount of the proceeds  received by such
Investor  from  the  sale  of  such  Investor's  Registrable  Securities  (after
deducting any fees,  discounts and commissions  applicable  thereto) pursuant to
any  Registration   Statement  under  which  such  Registrable   Securities  are
registered  under  the  Securities  Act and  (ii)  underwriter  be  required  to
undertake  liability  to any person  hereunder  for any amounts in excess of the
aggregate discount, commission or other compensation payable to such underwriter
with respect to the  Registrable  Securities  underwritten by it and distributed
pursuant to such Registration Statement.

                  Section 8. Notices. All notices, demands, requests,  consents,
approvals,  and other communications required or permitted hereunder shall be in
writing and, unless otherwise  specified herein,  shall be delivered as provided
in the Purchase Agreement.

                  Section 9.  Assignment.  This  Agreement  is binding  upon and
inures  to the  benefit  of the  parties  hereto  and  their  respective  heirs,
successors and permitted  assigns.  The rights granted the Investors  under this
Agreement may be assigned as permitted by the Purchase Agreement.

                  Section 10. Additional  Covenants of the Company.  The Company
agrees that at such time as it otherwise meets the  requirements  for the use of
Securities Act Registration Statement on Form S-3 for the purpose of registering
the Registrable  Securities,  it shall file all reports and information required
to be filed by it with the Commission in a timely manner and take all such other
action so as to maintain such eligibility for the use of such form.

                  Section  11.  Counterparts/Facsimile.  This  Agreement  may be
executed  in two or  more  counterparts,  each  of  which  shall  constitute  an
original,  but all of which, when together shall constitute but one and the same
instrument,  and shall become effective when one or more  counterparts have been
signed by each party hereto and delivered to the other  parties.  In lieu of the
original, a facsimile transmission or copy of the original shall be as effective
and enforceable as the original.

                  Section 12. Remedies.  The remedies provided in this Agreement
are cumulative  and not exclusive of any remedies  provided by law. If any term,
provision,  covenant  or  restriction  of this  Agreement  is held by a court of
competent  jurisdiction  to be  invalid,  illegal,  void or  unenforceable,  the
remainder of the terms, provisions,  covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected,  impaired
or invalidated,  and the parties hereto shall use their best efforts to find and
employ an alternative means to achieve the same or substantially the same result
as that contemplated by such term, provision, covenant or restriction.

                  Section 13.  Conflicting  Agreements.  The  Company  shall not
enter into any agreement  with respect to its  securities  that is  inconsistent
with the  rights  granted  to the  holders  of  Registrable  Securities  in this
Agreement or  otherwise  prevents  the Company  from  complying  with all of its
obligations hereunder.

                  Section 14.  Headings.   The  headings in this  Agreement  are
for   reference  purposes  only  and  shall not affect in any way the meaning or
interpretation of this Agreement.

                  Section 15. Governing Law,  Arbitration.  This Agreement shall
be governed by and  construed  in  accordance  with the laws of the State of New
York  applicable to contracts made in New York by persons  domiciled in New York
City and without  regard to its  principles  of conflicts  of laws.  Any dispute
under this  Agreement  shall be  submitted  to  arbitration  under the  American
Arbitration  Association  (the "AAA") in New York City,  New York,  and shall be
finally and  conclusively  determined by the decision of a board of  arbitration
consisting  of three  (3)  members  (hereinafter  referred  to as the  "Board of
Arbitration") selected as according to the rules governing the AAA. The Board of
Arbitration shall meet on consecutive  business days in New York City, New York,
and shall reach and render a decision in writing  (concurred in by a majority of
the members of the Board of  Arbitration)  with  respect to the amount,  if any,
which the losing  party is  required  to pay to the other  party in respect of a
claim  filed.  In  connection  with  rendering  its  decisions,   the  Board  of
Arbitration  shall  adopt and follow  the laws of the State of New York.  To the
extent  practical,  decisions of the Board of  Arbitration  shall be rendered no
more than thirty (30) calendar days following  commencement of proceedings  with
respect thereto. The Board of Arbitration shall cause its written decision to be
delivered to all parties involved in the dispute. Any decision made by the Board
of  Arbitration  (either  prior to or after the  expiration  of such thirty (30)
calendar day period)  shall be final,  binding and  conclusive on the parties to
the dispute,  and entitled to be enforced to the fullest extent permitted by law
and entered in any court of  competent  jurisdiction.  The Board of  Arbitration
shall be authorized and is hereby directed to enter a default  judgment  against
any party failing to  participate in any  proceeding  hereunder  within the time
periods set forth in the AAA rules. The non-prevailing  party to any arbitration
(as  determined  by the  Board of  Arbitration)  shall pay the  expenses  of the
prevailing party,  including reasonable attorneys' fees, in connection with such
arbitration.  Any party  shall be entitled  to obtain  injunctive  relief from a
court in any case where such relief is available,  and the non-prevailing  party
in any such  injunctive  proceeding  shall pay the  expenses  of the  prevailing
party,  including reasonable attorneys' fees, in connection with such injunctive
proceeding.

<PAGE>

                  IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  this
Registration  Rights  Agreement to be duly  executed,  on the day and year first
above written.

                               SEDONA CORPORATION

                               By:________________________________________
                                  Marco A. Emrich, President and CEO

                               AMRO International, S.A.

                               By:________________________________________
                                  H. U. Bachofen, Director

                               Markham Holdings Limited

                               By:________________________________________
                                  H. U. Bachofen, Director

                               Aspen International Limited

                               By:________________________________________
                                  Authorized Signatory

                               The Cuttyhunk Fund Limited

                               By:________________________________________
                                  Authorized Signatory

                              The George S.Sarlo 1995 Charitable Remainder Trust

                              By:________________________________________
                                 Authorized Signatory

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