Document:

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                                                                   EXHIBIT 10.24

                              WARRANT AGREEMENT OF

                             MAI SYSTEMS CORPORATION

                                1,000,000 SHARES

                          Dated as of January 13, 2003

                         COMMON STOCK PURCHASE WARRANTS

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         WARRANT AGREEMENT dated as of January 13, 2003, between MAI Systems
Corporation, a Delaware corporation (the "Company"), the Company as Warrant
Agent (in such capacity, "Warrant Agent"), and those persons signatory hereto
(collectively, the "Warrant Holder" or "Holder").

         The Company proposes to issue Common Stock Purchase Warrants as
hereinafter described (collectively the "Warrants") to purchase an aggregate of
up to 1,000,000 shares of its Common Stock, $0.01 par value per share (the
shares of Common Stock issuable on exercise of the Warrants being referred to
herein as the "Warrant Shares"), in favor of the Warrant Holder. Capitalized
terms used herein, if not otherwise defined, are defined in Section 8 hereof.

         The Company and the Warrant Holder hereby agree as follows:

         Section 1.        TRANSFERABILITY; NOTICE OF CORPORATE ACTIONS; FORM OF
THE WARRANTS.

                  1.1      REGISTRATION. The Warrants shall be numbered and
shall be registered on the books of the Company maintained at the principal
office of the Company in Irvine, California ("the Warrant Register"). The
Company shall be entitled to treat the Holder of the Warrants as the owner in
fact thereof for all purposes and shall not be bound to recognize any equitable
or other claim to or interest in such Warrants on the part of any other Person.

                  1.2      TRANSFERABILITY. The Warrants are only transferable
with Company's prior written consent, subject to applicable securities laws
restrictions, which consent shall not unreasonably be withheld or delayed. The
holder of any Warrants so transferred shall continue to be bound by this
Agreement. However, the minimum denomination of any Warrant hereunder shall be a
Warrant exchangeable for 10,000 Warrant Shares.

                  1.3      TRANSFER-GENERAL. Subject to the terms hereof, the
Warrants shall be transferable only on the books of the Company maintained at
its principal office upon delivery thereof duly endorsed by the Holder or by his
duly authorized attorney or representative, or accompanied by proper evidence of
succession, assignment or authority to transfer. In all cases of transfer by an
attorney, the original power of attorney, duly approved, or a copy thereof, duly
certified, shall be deposited and remain with the Company. In case of transfer
by executors, administrators, guardians or other legal representatives, duly
authenticated evidence of their authority shall be produced, and may be required
to be deposited and to remain with the Company in its discretion. Upon any
registration of transfer, the Company shall countersign and deliver new Warrants
to the Persons entitled thereto. The Company or the Warrant Agent may require
the payment of a sum sufficient to cover any tax or governmental charge that may
be imposed in connection with any such transfer.

                  1.4      NOTICES OF CORPORATE ACTIONS. In the event of: (a)
any taking by the Company of a record of the holders of the Common Stock for the
purpose of determining the holders thereof who are entitled to receive any
extraordinary dividend or distribution, (other than cash dividends representing
a dividend payment on an annualized basis of not more than 10% of the Company's
Market Capitalization at the time of such dividend) or any right to subscribe
for, purchase or otherwise acquire any shares of capital stock of any class or
any other securities, (b) any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the Company or any
consolidation or merger involving the Company and any other

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Person or any transfer or other disposition of all or substantially all the
assets of the Company to another Person; (c) any voluntary or involuntary
dissolution, liquidation or winding-up of the Company, or (d) any amendment of
the Certificate of Incorporation of the Company, the Company shall mail to each
Warrant Holder in accordance with the provisions of Section 14 hereof a notice
specifying (i) the date or expected date on which any such record is to be taken
for the purpose of such dividend, distribution or right, and the amount and
character of such dividend, distribution or right and (ii) the date or expected
date on which any such reorganization, reclassification, recapitalization,
consolidation, merger, transfer, disposition, dissolution, liquidation or
winding-up is to take place, the time, if any such time is to be fixed, as of
which the holders of record of Common Stock shall be entitled to exchange their
shares of Common Stock for the securities or Other Property deliverable upon
such reorganization, reclassification, recapitalization, consolidation, merger,
transfer, disposition, dissolution, liquidation or winding-up and a description
in reasonable detail of the transaction. Such notice shall be mailed to the
extent practicable at least thirty (30), but not more than ninety (90) days
prior to the date therein specified. In the event that the Company at any time
sends any notice to the holders of its Common Stock, it shall concurrently send
a copy of such notice to each Warrant Holder.

                  1.5      FORM OF THE WARRANTS. The text of the Warrants and of
the form of election to purchase Warrant Shares (the "Purchase Form") shall be
substantially as set forth respectively in Exhibits A and B attached hereto. The
price per Warrant Share (the "Warrant Price") and the number of Warrant Shares
issuable upon exercise of each Warrant are subject to adjustment upon the
occurrence of certain events, all as hereinafter provided. The Warrants shall be
executed on behalf of the Company by its Chief Executive Officer and President
or its Chief Financial and Operating Officer , under its corporate seal
reproduced thereon, and attested by its Secretary or an Assistant Secretary.

                  The Warrants shall be dated as of the date of countersignature
thereof by the Company either upon initial issuance or upon transfer.

                  1.6      RESTRICTIVE LEGEND. Except as otherwise provided in
this Section 1.6, each Warrant and each certificate for Warrants or Warrant
Shares and each certificate for Warrant Shares issued to any subsequent
transferee of any such certificate, shall be stamped or otherwise imprinted with
a legend in substantially the following form:

         THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE
         SECURITIES LAW. NO TRANSFER OF THE SECURITIES REPRESENTED BY THIS
         CERTIFICATE SHALL BE VALID OR EFFECTIVE UNLESS (A) SUCH TRANSFER IS
         MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR
         (B) THE HOLDER OF THE SECURITIES PROPOSED TO BE TRANSFERRED SHALL HAVE
         DELIVERED TO THE COMPANY AN OPINION OF COUNSEL (WHO MAY BE AN EMPLOYEE
         OF SUCH HOLDER) REASONABLY ACCEPTABLE TO THE COMPANY TO THE EFFECT THAT
         SUCH PROPOSED TRANSFER IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF
         THE ACT OR (C) SUCH TRANSFER IS PURSUANT TO RULE 144 OR RULE 144A UNDER
         THE ACT AND

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         SUCH HOLDER(S) SHALL HAVE DELIVERED TO THE COMPANY A CERTIFICATE
         SETTING FORTH THE BASIS FOR APPLYING SUCH RULE TO THE PROPOSED
         TRANSFER.

                  1.7      TERMINATION OF SECURITIES LAWS RESTRICTIONS. The
legend requirements of Section 1.6 shall terminate as to any particular Warrant
or Warrant Shares when the Company shall have received from the Holder thereof
an opinion of counsel reasonably acceptable to the Company to the effect that
such legend is not required in order to ensure compliance with the Securities
Act. Whenever the restrictions imposed by this Agreement shall terminate as to
the Warrants, as hereinabove provided, the Holder hereof shall be entitled to
receive from the Company, at the expense of the Company, a new Warrant or
Warrant Shares bearing no legends.

         Section 2.        TERM OF THE WARRANTS; EXERCISE OF THE WARRANTS;
WARRANT PRICE, ETC.

                  2.1      TERM OF THE WARRANTS. Subject to the terms of this
Agreement, the Holder shall have the right, which may be exercised from time to
time, from and through the dates set forth in the Warrants, to purchase from the
Company the number of fully paid and nonassessable Warrant Shares which the
Holder may at the time be entitled to purchase on exercise of such Warrant. If
the last day for the exercise of the Warrants shall not be a Business Day, then
the Warrant may be exercised on the next succeeding Business Day.

                  2.2      VESTING OF THE WARRANTS. The Warrants shall
immediately vest and may be exercised on or after the date hereof in accordance
with the terms of this Agreement and the Warrant Certificate.

                  2.3      CALL PROVISIONS. [Omitted.]

                  2.4      EXERCISE OF THE WARRANTS. The Warrants may be
exercised upon surrender to the Company, at its principal office, of the
certificate evidencing the Warrant to be exercised, together with the Purchase
Form, in the form of Exhibit B hereto, on the reverse thereof duly filled in and
signed, and upon payment to the Company, of the Warrant Price (as defined in and
determined in accordance with the provisions of Sections 2 and 6 hereof), for
the number of Warrant Shares in respect of which such Warrant is then exercised.
Upon partial exercise, a Warrant Certificate for the unexercised portion shall
be delivered to the Holder. Payment of the aggregate Warrant Price shall be
payable in (i) cash, (ii) certified check payable to the order of the Company,
(iii) outstanding shares of Common Stock duly endorsed to the Company (which
shares of Common Stock shall be valued at their Fair Market Value as of the day
preceding the date of such exercise), (iv) by delivery to the Company and
cancellation of the Company's 11% Subordinated Notes, as amended, which shall be
valued for this purpose at the principal amount thereof so delivered plus the
accrued interest thereon on the date of delivery of the Subordinated Notes (v)
by delivery of Warrants owned by Warrant Holder having a Fair Market Value, as
of the day preceding the date of such exercise, in excess of the exercise price
of such Warrants, or (vi) any combination of the foregoing, or through (vii)
such other method of payment as may be provided in the applicable Warrant
Agreement.

                  Subject to Section 3 hereof, upon such surrender of the
Warrants and payment of the Warrant Price as aforesaid, the Company shall issue
and cause to be delivered with all

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reasonable dispatch to or upon the written order of the Holder and in such name
or names as the Holder may designate, a certificate or certificates for the
number of full Warrant Shares so purchased upon the exercise of such Warrant,
together with cash, as provided in Section 9 hereof, in respect of any
fractional Warrant Shares otherwise issuable upon such surrender. Such
certificate or certificates shall be deemed to have been issued and any Person
so designated to be named therein shall be deemed to have become a holder of
record of such Warrant Shares as of the date of the surrender of such Warrant
and payment of the Warrant Price, as aforesaid; provided, however, that if, at
the date of surrender of such Warrant and payment of such Warrant Price, the
transfer books for the Warrant Shares or other class of stock purchasable upon
the exercise of such Warrant shall be closed, the certificates for the Warrant
Shares in respect of which such Warrant are then exercised shall be issuable as
of the date on which such books shall next be opened (whether before or after
the Expiration Date or the Notice Period) and until such date the Company shall
be under no duty to deliver any certificate for such Warrant Shares; provided,
further, that the transfer books of record, unless otherwise required by law,
shall not be closed at any one time for a period longer than 20 calendar days.

                  2.5      WARRANT PRICE. The price per share at which Warrant
Shares shall be purchasable upon exercise of the Warrant (the "Warrant Price")
shall be $0.40, subject to adjustment pursuant to Section 6 hereof.

         Section 3.        PAYMENT OF TAXES AND INDEMNIFICATION.

                  3.1      PAYMENT OF TAXES. The Company will pay all
documentary stamp taxes, if any, attributable to the issuance of Warrants and
Warrant Shares upon the exercise of the Warrants.

                  3.2      INDEMNIFICATION. Warrant Holder hereby agrees to
indemnify and hold the Company harmless from any and all taxes on the Warrant
Holder that may result from the issuance of the Warrants or any subsequent
exercise of the Warrants and issuance of the Warrant Shares.

         Section 4.        MUTILATED OR MISSING WARRANTS. In case the Warrants
shall be mutilated, lost, stolen or destroyed, the Company shall issue and
deliver in exchange and substitution for and upon cancellation of the mutilated
Warrants, or in lieu of and substitution for the Warrants lost, stolen or
destroyed, a new certificate of like tenor and representing an equivalent right
or interest; but only upon receipt of evidence reasonably satisfactory to the
Company of such loss, theft or destruction of such Warrant certificate and
indemnity or bond, if requested, also reasonably satisfactory to them. An
applicant for such substitute Warrant certificate shall also comply with such
other reasonable regulations and pay such other reasonable charges as the
Company may prescribe.

         Section 5.        RESERVATION OF WARRANT SHARES.

                  5.1      RESERVATION OF WARRANT SHARES. There have been
reserved, and the Company shall at all times keep reserved, out of its
authorized shares of Common Stock, a number of shares of Common Stock sufficient
to provide for the exercise of the rights of purchase represented by the
outstanding Warrants. The transfer agent for the Common Stock ("Transfer
Agent"), and every subsequent transfer agent for any shares of the Company's
capital

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stock issuable upon the exercise of any of the rights of purchase aforesaid will
be and are hereby irrevocably authorized and directed at all times until the
Expiration Date to reserve such number of authorized shares as shall be
requisite for such purpose. The Company will keep a copy of this Agreement on
file with the Transfer Agent and with every subsequent transfer agent for any
shares of the Company's capital stock issuable upon the exercise of the rights
of purchase represented by the Warrants. The Company covenants that all Warrant
Shares which may be issued upon exercise of Warrants will, upon issue, be fully
paid, nonassessable, free of preemptive rights and free from all taxes, liens,
charges and security interests with respect to the issue thereof. The Company
will supply such Transfer Agent and any subsequent transfer agent with duly
executed stock certificates for such purpose and will itself provide or
otherwise make available any cash which may be payable as provided in Section 9
of this Agreement. The Company will furnish to such Transfer Agent a copy of all
notices of adjustments, and certificates related thereto, transmitted to each
Holder. The Warrants surrendered in the exercise of the rights thereby evidenced
shall be canceled by the Company.

                  5.2      CANCELLATION OF THE WARRANTS. In the event the
Company shall purchase or otherwise acquire the Warrants, the same shall be
canceled and retired.

         Section 6.        ADJUSTMENT OF WARRANT PRICE AND NUMBER OF WARRANT
SHARES. The number and kind of securities purchasable upon the exercise of the
Warrants and the Warrant Price shall be subject to adjustment from time to time
upon the happening of certain events, as hereinafter defined.

                  6.1      Stock Dividends, Subdivisions and Combinations. If at
any time the Company shall:

                           (i)      take a record of the holders of its Common
                                    Stock for the purpose of entitling them to
                                    receive a dividend payable in, or other
                                    distribution of, additional shares of Common
                                    Stock,

                           (ii)     subdivide its shares of Common Stock
                                    Outstanding into a larger number of shares
                                    of such Common Stock, or

                           (iii)    combine its shares of Common Stock
                                    Outstanding into a smaller number of shares
                                    of such Common Stock,

then the Exercise Price shall be adjusted to equal the product of the Exercise
Price in effect immediately prior to such event multiplied by a fraction the
numerator of which is equal to the number of shares of Common Stock Outstanding
immediately prior to the adjustment and the denominator of which is equal to the
number of shares of Common Stock Outstanding immediately after such adjustment.

                  6.2      RIGHTS OFFERINGS OF COMMON STOCK. (a) In case the
Company shall issue rights, options or warrants to all holders of its Common
Stock entitling them to subscribe for or purchase shares of Common Stock at a
price per share less than the Current Market Price per share (determined as
provided below) of the Common Stock on the date fixed for the determination of
stockholders entitled to receive such rights, options or warrants, the Exercise
Price in effect at the opening of business on the day following the date fixed
for such

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determination shall be decreased by multiplying such Exercise Price by a
fraction of which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination
plus the number of shares of Common Stock which the aggregate of the offering
price of the total number of shares of Common Stock so offered for subscription
or purchase would purchase at such Current Market Price and the denominator
shall be the number of shares of Common Stock outstanding at the close of
business on the date fixed for such determination plus the number of shares of
Common Stock so offered for subscription or purchase, such decrease to become
effective immediately after the opening of business on the day following the
date fixed for such determination. For the purposes of this provision, the
number of shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include shares issuable in
respect of script certificates issued in lieu of fractions of shares of Common
Stock. The Company will not issue any rights, options or warrants in respect of
shares of Common Stock held in the treasury of the Company.

                  (b)      The provisions of this Section 6.2 shall not apply to
         any issuance of Common Stock for which an adjustment is provided for
         under Section 6.1.

                  6.3      OTHER DISTRIBUTIONS. In case the Company shall, by
dividend or otherwise, distribute to all holders of its Common Stock evidences
of its indebtedness, shares of any class of capital stock, or other property
(including securities, but excluding (i) any rights, options or warrants
referred to in Section 6.2, (ii) any dividend or distribution paid exclusively
in cash, (iii) any dividend or distribution referred to in Section 6.1, and (iv)
any merger or consolidation or other transactions to which Section 6.5 or
Section 6.7 applies), the Exercise Price shall be reduced by multiplying the
Exercise Price in effect immediately prior to the close of business on the date
fixed for the determination of stockholders entitled to receive such
distribution by a fraction of which the numerator shall be the Current Market
Price per share of the Common Stock on the date fixed for such determination
(the "Reference Date") less the then fair market value (as determined by the
Board of Directors, whose determination shall be conclusive and described in a
Board Resolution filed with the Warrant Agent) on the Reference Date of the
portion assets, shares or evidences of indebtedness of the Company so
distributed applicable to one share of Common Stock and the denominator shall be
the Current Market Price per share of the Common Stock on the Reference Date,
such adjustment to become effective immediately prior to the opening of business
on the day following the Reference Date.

                  6.4      ADJUSTMENT OF NUMBER OF SHARES PURCHASABLE. Upon any
adjustment of the Exercise Price as provided in Section 6.1, 6.2 or 6.3 hereof,
the Warrant Holder shall thereafter be entitled to purchase upon the exercise of
the Warrants, at the Exercise Price resulting from such adjustment, the number
of shares of Common Stock (calculated to the nearest 1/100th of a share)
obtained by multiplying the Exercise Price in effect immediately prior to such
adjustment by the number of shares of Common Stock issuable on the exercise
hereof immediately prior to such adjustment and dividing the product thereof by
the Exercise Price resulting from such adjustment.

                  6.5      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 any change whatsoever in, or distribution with respect to, the Outstanding
Common Stock of the Company), or sell, transfer or otherwise dispose of all or

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substantially all of its property, assets or business to another corporation
and, pursuant to the terms of such reorganization, reclassification, merger,
consolidation or disposition of assets, (i) shares of common stock of the
successor or acquiring corporation or of the Company (if it is the surviving
corporation) or (ii) 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 who are holders immediately prior to such
transaction, then the Warrant Holder shall have the right thereafter to receive,
upon exercise of the Warrants, 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 the Warrants are
exercisable immediately prior to such event. In such event, the aggregate
Exercise Price otherwise payable for the shares of Common Stock issuable upon
exercise of the Warrants shall be allocated among the shares of common stock and
Other Property receivable as a result of such reorganization, reclassification,
merger, consolidation or disposition of assets in proportion to the respective
fair market values of such shares of common stock and Other Property as
determined in good faith by the Board of Directors of the Company. 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 Agreement to be performed and observed
by the Company and all the obligations and liabilities hereunder, subject to
such modifications as may be reasonably deemed appropriate (as determined by
resolution of the Board of Directors of the Company) in order to provide for
adjustments of any shares of the common stock of such successor or acquiring
corporation for which the Warrants thus become exercisable, which modifications
shall be as equivalent as practicable to the adjustments provided for in this
Section 6. For purposes of this Section 6.5, "common stock of the successor or
acquiring corporation" shall include stock of such corporation of any class that
is not preferred as to dividends or assets over any other class of stock of such
corporation and that is not subject to redemption and shall also include any
evidences of indebtedness, shares of stock or other securities that 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 6.5 shall similarly apply to successive
reorganizations, reclassification, mergers, consolidations or disposition of
assets.

                  6.6      DETERMINATION OF CONSIDERATION. For purposes of
Sections 6.1, 6.3 and 6.5 hereof, the consideration received and/or receivable
by the Company in connection with the issuance, sale, grant or exercise of
additional shares of Common Stock, Stock Purchase Rights or Convertible
Securities, irrespective of the accounting treatment of such consideration,
shall be valued as follows:

                           (1)      Securities or Other Property. In the case of
         securities or other property, the fair market value thereof as of the
         date immediately preceding such issuance, sale, grant or exercise as
         determined in good faith by the Board of Directors of the Company.

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                           (2)      Dividends in Securities. In case the Company
         shall declare a dividend or make any other distribution upon any stock
         of the Company payable in either case in Common Stock or Convertible
         Securities, such Common Stock 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.

                           (3)      Merger, Consolidation or Sale of Assets. In
         case any shares of Common Stock, Stock Purchase Rights or Convertible
         Securities shall be issued in connection with any merger or
         consolidation 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 assets and business of the non-surviving
         corporation attributable to such Common Stock, Stock Purchase Rights or
         Convertible Securities, as is determined in good faith by the Company's
         Board of Directors.

                  6.7      Corporate Distribution Event.

                  (a)      PRICE ADJUSTMENT. In the event that the Company shall
         subdivide (a "Corporate Distribution Event") into two or more corporate
         entities which are owned (at least initially) by shareholders of the
         Company or shall distribute to its shareholders, without consideration,
         shares of one or more subsidiaries or affiliated corporations or former
         divisions (the Company and each new entity a "Constituent Corporation
         and collectively the "Constituent Corporations") then the Warrants
         shall be divided into the right to purchase shares of common stock of
         the Constituent Corporations based upon the number of shares of common
         stock outstanding of each Constituent Corporation immediately after the
         Corporate Distribution Event such that the Holders of the Warrants will
         receive upon exercise of the Warrants in each of the Constituent
         Corporations a proportionate share of such Constituent Corporations'
         common stock equal to that share of the Company's Common Stock issuable
         upon exercise of the Warrants prior to the Corporate Distribution
         Event, such that the new warrant price per share for each warrant to
         purchase shares in each of the Constituent Corporations reflects the
         relative Market Capitalization values of the Constituent Corporations
         after completion of the Corporate Distribution Event (rated by the
         number of shares received by the holder of a share of Company Common
         Stock) and such that the total consideration to be paid by the Holders
         upon exercise of all of the Warrants in all of the Constituent
         Corporations is equal to the total consideration which would have been
         paid by the Holders prior to the Corporate Distribution Event if they
         had exercised all the Warrants for the purchase of Company Common
         Stock. Each Constituent Corporation shall become a party to a successor
         warrant agreement similar hereto in form and substance reasonably
         satisfactory to the Holders of the Warrants.

By way of example, if the Company had 7,500,000 shares of Common Stock
outstanding prior to the Corporate Distribution Event and the Company
distributed to each holder of its Common Stock two shares of common stock in a
newly formed Constituent Corporation ("Newco Common Stock") for each share of
Company Common Stock, and, during the twenty (20) trading days after the
completion of the Corporate Distribution Event, the shares of Newco Common Stock
traded at an average price of $6 per share and the shares of Company Common
Stock traded at an average price of $9 per share, then each Holder of Warrants
would be entitled to a reduction in his or her Exercise Price for the Warrants
which would continue to be

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exercisable for Company Common Stock to $3.43 per share and the Holders of
Warrants would receive in addition 1,500,000 warrants to purchase a like number
of shares of Newco Common Stock, each exercisable at $2.29 per share.

Adjustments made pursuant to this Section 6.7 shall be applied to successive
Corporate Distribution Events, the provisions of this Section 6 shall be
applicable to the warrants of all Constituent Corporations and the principles of
Sections 6.1 through 6.5 shall similarly apply to the Corporate Distribution
Event and the Constituent Corporations, if applicable.

                  (b)      REGISTRATION RIGHTS. Any common stock of the
         Constituent Corporations shall be subject to equivalent Registration
         Rights as the Registration Rights applicable to the Company Common
         Stock under the Registration Rights Agreement.

                  6.8      OTHER PROVISIONS APPLICABLE TO ADJUSTMENTS UNDER THIS
SECTION. The following provisions shall be applicable to the adjustments
provided for pursuant to this Section 6:

                  (a)      When Adjustments To Be Made. The adjustments required
         by this Section 6 shall be made whenever and as often as any specified
         event requiring such an adjustment shall occur. For the purpose of any
         such adjustment, any specified event shall be deemed to have occurred
         at the close of business on the date of its occurrence.

                  (b)      Fractional Interests. In computing adjustments under
         this Section 6, fractional interests in Common Stock shall be taken
         into account to the nearest 1/100th of a share.

                  (c)      When Adjustment Not Required. If the Company shall
         take a record of the holders of its Common Stock for the purpose of
         entitling them to receive a dividend or distribution to which the
         provisions of Section 6 would apply, but shall, thereafter and before
         the distribution to stockholders thereof, legally abandon its plan to
         pay or deliver such dividend or distribution, then thereafter no
         adjustment shall be required by reason of the taking of such record and
         any such adjustment previously made in respect thereof shall be
         rescinded and annulled.

                  (d)      Maximum Exercise Price. Except as provided in Section
         6.1 above, at no time shall the Exercise Price per share of Common
         Stock exceed the amount set forth in this Agreement.

                  (e)      Certain Limitations. Notwithstanding anything herein
         to the contrary, the Company agrees not to enter into any transaction
         that, by reason of any adjustment under Section 6.1, 6.2 or 6.3 above,
         would cause the Exercise Price to be less than the par value of the
         Common Stock, if any, unless the Company first reduces the par value of
         the Common Stock to be less than the Exercise Price that would result
         from such transaction.

                  (f)      Notice of Adjustments. Whenever the number of shares
         of Common Stock for which the Warrants are exercisable or the Exercise
         Price shall be adjusted pursuant to this Section 6, the Company shall
         forthwith prepare a certificate to be executed by the chief financial
         officer of the Company setting forth, in reasonable detail,

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         the event requiring the adjustment and the method by which such
         adjustment was calculated, specifying the number of shares of Common
         Stock for which the Warrants are exercisable and (if such adjustment
         was made pursuant to Section 6.5) describing the number and kind of any
         other shares of stock or Other Property for which the Warrants are
         exercisable, and any related change in the Exercise Price, after giving
         effect to such adjustment or change. The Company shall promptly cause a
         signed copy of such certificate to be delivered to each Holder in
         accordance with Section 14. The Company shall keep at its principal
         office copies of all such certificates and cause the same to be
         available for inspection at said office during normal business hours by
         any Holder or any prospective transferee of any Warrants designated by
         a Holder thereof.

                  (g)      Independent Application. Except as otherwise provided
         herein, all subsections of this Section 6 are intended to operate
         independently of one another (but without duplication). If an event
         occurs that requires the application of more than one subsection, all
         applicable subsections shall be given independent effect without
         duplication.

                  6.9      DISPUTES. In the event that there is any dispute as
to the computation of the price or the number of Warrant Shares required to be
issued upon exercise of Warrants or any other disputed calculation or adjustment
under Section 6 hereof, the Warrant Holders and the Company will retain an
independent and nationally recognized accounting firm to conduct at the expense
of the Company a special procedures engagement of the computations pursuant to
the terms hereof involved in such dispute, including the financial statements or
other information upon which such computations were based. The determination of
such nationally recognized accounting firm shall, in the absence of manifest
error, be binding upon the Warrant Holders and the Company. If there shall be a
dispute as to the selection of such nationally recognized accounting firm, such
firm shall be appointed by the American Institute of Certified Public
Accountants, if willing, otherwise the American Arbitration Association, upon
application by the Company or any holder or holders of at least 25% of the
outstanding Warrants with notice to the others.

         Section 7.        REGISTRATION RIGHTS.

                  (a)      COMPANY REGISTRATION. The Company shall register the
         Warrant Shares pursuant to the Registration Rights Agreement (attached
         hereto as an exhibit to this Agreement) under the Securities Act, and
         the Company shall, at such time, promptly give all holders of
         Registrable Securities written notice of such registration.

                  (b)      EXPENSES. The Company shall pay all Registration
         Expenses incurred in connection with the registration of Registrable
         Securities pursuant to the Registration Rights Agreement.

                                       11

<PAGE>

         Section 8.        DEFINITIONS.

                  As used in this Warrant Agreement, the following terms shall
have the following respective meanings:

                  BUSINESS DAY shall mean any day that is not a Saturday or
Sunday or a day on which banks are required or permitted to be closed in the
State of California.

                  COMMISSION means the Securities and Exchange Commission.

                  COMMON STOCK means (except where the context indicates that it
means the Common Stock of another corporation such as a Constituent Corporation)
the Common Stock of the Company, par value $0.01 per share, as constituted on
its original date of issue by the Company, and any capital stock into which such
Common Stock may thereafter be changed, and shall also include (i) capital stock
of the Company of any other class (regardless of how denominated) issued to the
holders of shares of any Common Stock upon any reclassification thereof which is
also not preferred as to dividends or liquidation over any other class of stock
of the Company and which is not subject to redemption and (ii) shares of common
stock of any successor or acquiring corporation (as defined in Section 6.5
hereof) received by or distributed to the holders of Common Stock of the Company
in the circumstances contemplated by Section 6.5 hereof.

                  CONVERTIBLE SECURITIES shall mean evidences of indebtedness,
shares of stock or other securities that are convertible into or exchangeable
for, with or without payment of additional consideration in cash or property,
shares of Common Stock, either immediately or upon the occurrence of a specified
date or a specified event.

                  CURRENT MARKET PRICE shall mean as of any specified date the
average of the daily market prices of the Common Stock of the Company for the
shorter of (x) the twenty (20) consecutive Business Days immediately preceding
such date or (y) the period commencing on the Business Day next following the
first public announcement of any event giving rise to an adjustment of the
Exercise Price pursuant to Section 6 and ending on such specified date. The
"daily market price" for each such Business Day shall be: (i) if the Common
Stock is then listed on a national securities exchange or is listed on NASDAQ
and is designated as a National Market System security, the last sale price,
regular way, on such day on the principal stock exchange or market system on
which such Common Stock is then listed or admitted to trading, or, if no such
sale takes place on such day, the average of the closing bid and asked prices
for the Common Stock on such day as reported on such stock exchange or market
system or (ii) if the Common Stock is not then listed or admitted to trading on
any national securities exchange or designated as a National Market System
security on NASDAQ but is traded over-the-counter, the average of the closing
bid and asked prices for the Common Stock as reported on NASDAQ or the
Electronic Bulletin Board or in the National Daily Quotation Sheets, as
applicable.

                  EXCHANGE ACT means the Securities Exchange Act of 1934, as
amended, or any successor act, and the rules and regulations of the Commission
promulgated thereunder, all as the same shall be in effect at the time.

                                       12

<PAGE>

                  EXERCISE PRICE shall mean, in respect of a share of Common
Stock at any date herein specified, the initial Exercise Price set forth in this
Agreement as adjusted from time to time pursuant to Section 6 hereof.

                  EXPIRATION DATE means the later of February 1, 2010,
approximately the seventh anniversary of the date of this Agreement, and the
date the Company's 11% Subordinated Notes, as amended, have been repaid in full.

                  GAAP shall mean generally accepted accounting principles in
the United States of America as from time to time in effect.

                  MARKET CAPITALIZATION means a number which is the sum of the
number of shares of Outstanding Common Stock multiplied by the Current Market
Price of the corporation in question.

                  NOTICE PERIOD shall mean the period of fifteen (15) days
commencing upon the delivery to the Holders of written notice of the Company's
intention to call the Warrants pursuant to Section 2.3, provided that conditions
(i), (ii) and (iii) of Section 2.3 have been satisfied and that such conditions
(ii) and (iii) continue to have been satisfied for such 15 days.

                  OUTSTANDING shall mean, when used with reference to Common
Stock, at any date as of which the number of shares thereof is to be determined,
all issued shares of Common Stock, except shares then owned or held by or for
the account of the Company or any Subsidiary thereof, and shall include all
shares issuable in respect of outstanding scrip or any certificates representing
fractional interests in shares of Common Stock.

                  ORIGINAL ISSUE DATE shall mean the date on which the Warrants
were issued, as set forth on Exhibit B hereto.

                  PERSON shall mean any individual, sole proprietorship,
partnership, limited liability company, joint venture, trust, incorporated
organization, association, corporation, institution, public benefit corporation,
entity or government (whether federal, state, county, city, municipal or
otherwise, including, without limitation, any instrumentality, division, agency,
body or department thereof).

                  REGISTRABLE SECURITIES shall have the meaning specified for
such term in the Registration Rights Agreement.

                  REGISTRATION EXPENSES shall have the meaning specified for
such term in the Registration Rights Agreement.

                  REGISTRATION RIGHTS means the right of a Holder to have its
Registrable Securities registered pursuant to Section 7 of this Agreement and
pursuant to the Registration Rights Agreement.

                  REGISTRATION RIGHTS AGREEMENT means the Agreement dated as of
January 13, 2003 between the Company and the Holders.

                                       13

<PAGE>

                  STOCK PURCHASE RIGHTS shall mean any options, warrants or
other securities or rights to subscribe to or exercisable for the purchase of
shares of Common Stock or Convertible Securities, whether or not immediately
exercisable.

                  SECURITIES ACT means the Securities Act of 1933, as amended,
or any successor act thereto, and the rules and regulations of the Commission
promulgated thereunder, all as the same shall be in effect at the time.

         Section 9.        FRACTIONAL INTERESTS. The Company shall not be
required to issue fractional Warrant Shares on the exercise of the Warrants. If
any fraction of a Warrant Share would, except for the provisions of this Section
8, be issuable on the exercise of the Warrants (or specified portion thereof),
the Company shall pay an amount in cash equal to the closing price for one share
of the Common Stock on the trading day immediately preceding the date the
Warrants are presented for exercise, multiplied by such fraction.

         Section 10.       NO RIGHTS AS STOCKHOLDER; NOTICES TO HOLDER. Nothing
contained in this Agreement or in the Warrants shall be construed as conferring
upon the Holder or his permitted transferees the right to vote or to receive
dividends or to consent to or receive notice as a stockholder in respect of any
meeting of stockholders for the election of directors of the Company or any
other matter, or any rights whatsoever as a stockholder of the Company.

         Section 11.       INSPECTION OF WARRANT AGREEMENT. The Company shall
keep copies of this Agreement and any notices given or received hereunder
available for inspection by the Holder during normal business hours at its
principal office.

         Section 12.       IDENTITY OF TRANSFER AND WARRANT AGENT. Forthwith
upon the appointment of any subsequent transfer agent for the Common Stock or
Warrant Agent, or any other shares of the Company's capital stock issuable upon
the exercise of the Warrants, the Company will notify the Holder of the name and
address of such subsequent transfer agent.

         Section 13.       FINANCIAL AND BUSINESS INFORMATION. Until the
Expiration Date, the Company shall deliver to each Warrant Holder promptly upon
their becoming available, copies of all public financial statements, reports and
filings, notices and proxy statements sent or made available by the Company to
the holders of any class of its securities generally.

         Section 14.       NOTICES. Any notice pursuant to this Agreement by any
Holder to the Company, shall be in writing and shall be mailed first class,
postage prepaid, or delivered to the Company at its office at 9601 Jeronimo
Road, Irvine, California, 92618, Attention: General Counsel.

                  Each party hereto may from time to time change the address to
which notices to it are to be delivered or mailed hereunder by notice in writing
to the other party. Any notice mailed pursuant to this Agreement by the Company
or the Warrant Agent to the Holder shall be in writing and shall be mailed first
class, postage prepaid, or delivered to the Holder at his address on the books
of the Warrant Agent, and a copy thereof shall be delivered to Canyon Capital
Management c/o Canyon Partners Incorporated, 9665 Wilshire Boulevard Suite 200,
Beverly Hills, CA 90012.

                                       14

<PAGE>

         Section 15.       GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT
GIVING EFFECT TO PRINCIPLES OF CONFLICT OF LAWS. THE PARTIES HERETO AGREE TO
SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF CALIFORNIA IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.

         Section 16.       SUPPLEMENTS AND AMENDMENTS. The Company and the
Warrant Agent may from time to time supplement or amend this Agreement in order
to cure any ambiguity or to correct or supplement any provision contained herein
which may be defective or inconsistent with any other provision herein, or to
make any other provisions in regard to matters or questions arising hereunder
which the Company and the Warrant Agent may deem necessary or desirable and
which shall not be inconsistent with the provisions of the Warrant and which
shall not adversely affect the interests of the Holder.

         Section 17.       SUCCESSORS. All the covenants and provisions of this
Agreement by or for the benefit of the Company, the Warrant Agent or the Holders
of the Warrants shall bind and inure to the benefit of their respective
successors and assigns hereunder.

         Section 18.       BENEFITS OF THIS AGREEMENT. Nothing in this Agreement
shall be construed to give to any Person other than the Company and the Holders
of the Warrants, any legal or equitable right, remedy or claim under this
Agreement, but this Agreement shall be for the sole and exclusive benefit of the
Company and the Holders.

         Section 19.       CAPTIONS. The captions of the Sections of this
Agreement have been inserted for convenience only and shall have no substantive
effect.

         Section 20.       COUNTERPARTS. This Agreement may be executed in any
number of counterparts each of which so executed shall be deemed to be an
original; but such counterparts together shall constitute but one and the same
instrument.

         IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed as of the day, month and year first above written.

                                  THE COMPANY:

                                  MAI SYSTEMS CORPORATION, a Delaware
                                  corporation

                                  By: __________________________________________
                                  Title: _______________________________________

                                       15

<PAGE>

                                  THE WARRANT AGENT:

                                  MAI SYSTEMS CORPORATION, a Delaware
                                  corporation

                                  By: __________________________________________
                                  Title: _______________________________________

Canyon Value Realization Fund, L.P.,
a California limited partnership as to 450,000 Warrants

By:   Canpartners Investments III, L.P.,
      a California limited partnership,
      its general partner

By:   Canyon Capital Advisors LLC,
      a Delaware limited liability company,
      its general partner

By:   Canpartners Incorporated,
      a California corporation,
      its general partner

By:   ______________________________
      Name:
      Title:

The Canyon Value Realization Fund (Cayman), Ltd. as to 450,000 Warrants

By:   MeesPierson (Cayman) Limited,
      its Administrator

By:   ______________________________
      Name:
      Title:

                                       16

<PAGE>

GRS Partners II as to 50,000 Warrants

By:   Grosvenor Capital Management L.P.,
      its Administrator

By:   Grosvenor Capital Management, Inc.,
      its general partner

By:   ______________________________
      Name:
      Title:

CPI Securities L.P.,
a California limited partnership as to 50,000 Warrants

By:   Canpartners Incorporated,
      a California corporation,
      its general partner

By:   ______________________________
      Name:
      Title:

                                       17

<PAGE>

                                    EXHIBIT A

                           Form of Warrant Certificate

No. ___                                                           _______ Shares

                          COMMON STOCK PURCHASE WARRANT

Void After 5:00 P.M.

Pacific Time on [February 1, 2010]

         THIS CERTIFIES THAT, for value received, _____________, the registered
holder of this Common Stock Purchase Warrant (the "Warrant") or permitted
assigns (the "Holder"), is entitled to purchase from MAI Systems Corporation, a
Delaware corporation (the "Company"), at any time until 5:00 p.m. Pacific Time
on the later of February 1, 2010 and the date the Company's 11% Subordinated
Notes, as amended, have been repaid in full (the "Expiration Date"), unless this
Warrant is earlier called by the Company pursuant to Section 2.3 of the Warrant
Agreement hereinafter mentioned, at the Warrant Price of $0.40 per share (the
"Warrant Price"), the number of shares of Common Stock of the Company (the
"Common Stock") which is equal to the number of Shares set forth above. The
number of shares purchasable upon exercise of this Warrant and the Warrant Price
per share shall be subject to adjustment from time to time as set forth in the
Warrant Agreement referred to below.

         This Warrant is issued under and in accordance with a Warrant
Agreement, dated as of January 13, 2003, between the Company, the Warrant Agent
and the Warrant Holders and is subject to the terms and provisions contained in
the Warrant Agreement, to all of which the Holder of this Warrant by acceptance
hereof consents. A copy of the Warrant Agreement may be obtained for inspection
by the Holder hereof upon written request to the Company.

         This Warrant may be exercised in whole or in part by presentation of
this Warrant with the Purchase Form on the reverse side hereof duly executed and
simultaneous payment of the Warrant Price (subject to adjustment) at the
principal office of the Company in Irvine, California. Payment of such price
shall be payable at the option of the Holder hereof in the manner described in
the Warrant Agreement. Terms relating to exercise of Warrant are set forth more
fully in the Warrant Agreement.

         This Warrant may be exercised in whole or in part. Upon partial
exercise, a Warrant Certificate for the unexercised portion shall be delivered
to the Holder. No fractional shares will be issued upon the exercise of this
Warrant but the Company shall pay the cash value of any fraction upon the
exercise of the Warrant. This Warrant is transferable only in limited
circumstances as described in this Warrant Agreement at the office of the
Company in Irvine, California, in the manner and subject to the limitations set
forth in the Warrant Agreement.

         THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE
         SECURITIES LAW. NO

                                       18

<PAGE>

         TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE SHALL BE
         VALID OR EFFECTIVE UNLESS (A) SUCH TRANSFER IS MADE PURSUANT TO AN
         EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR (B) THE HOLDER OF THE
         SECURITIES PROPOSED TO BE TRANSFERRED SHALL HAVE DELIVERED TO THE
         COMPANY AN OPINION OF COUNSEL (WHO MAY BE AN EMPLOYEE OF SUCH HOLDER)
         REASONABLY ACCEPTABLE TO THE COMPANY TO THE EFFECT THAT SUCH PROPOSED
         TRANSFER IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE ACT OR (C)
         SUCH TRANSFER IS PURSUANT TO RULE 144 OR RULE 144A UNDER THE ACT AND
         SUCH HOLDER(S) SHALL HAVE DELIVERED TO THE COMPANY A CERTIFICATE
         SETTING FORTH THE BASIS FOR APPLYING SUCH RULE TO THE PROPOSED
         TRANSFER."

         The Holder hereof may be treated by the Company and all other Persons
dealing with this Warrant as the absolute owner hereof for any purpose and as
the person entitled to exercise the rights represented hereby, or to the
transfer hereof on the books of the Company. Any notice to the contrary
notwithstanding, and until such transfer on which books, the Company may treat
the Holder hereof as the owner for all purposes.

         This Warrant does not entitle any Holder hereof to any of the rights of
a stockholder of the Company.

                                                MAI  SYSTEMS CORPORATION

                                                By:
                                                Chief Executive Officer

Attest
         Secretary

DATED: As of_________, 2003

                                       19

<PAGE>

                                    Exhibit B

                                  Purchase Form

Mailing Address

_________________________________
         _________________________________

_________________________________
         _________________________________

_________________________________
         _________________________________

         The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant for, and to purchase thereunder,
_______________ shares of the stock provided for therein, and tenders herewith
payment of the Warrant Price in full in the form of cash or by cashier's check
in the amount of $______________], or as otherwise provided in the Warrant.

         The undersigned requests that certificates for such shares be issued in
the name of:

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

(Please Print Name, Address and Social Security No.)

                  DATED:            , ______

Name of Warrant Holder or Permitted Assignee:

________________________________________________________________________________

Address:

________________________________________________________________________________

________________________________________________________________________________
Signature:

Note:    The above signature must correspond with the name as written upon the
         face of this Warrant Certificate in every particular, without
         alteration or enlargement or any change whatever, unless this Warrant
         has been assigned.

Signature Guaranteed:

                                       20<PAGE>

                                                                   EXHIBIT 10.25

                    REGISTRATION RIGHTS AGREEMENT IN FAVOR OF

                      THE HOLDERS OF REGISTABLE SECURITIES

<PAGE>

                          REGISTRATION RIGHTS AGREEMENT

         This Registration Rights Agreement (the "Agreement") is made and
entered into as of January 13, 2003 by and among MAI Systems Corporation, a
Delaware corporation, and the holders of Registrable Securities (the "Holders")
signatory to this Agreement.

         This Agreement is made pursuant to the Warrant Agreement and MAI
Amendment No. Three (the "Canyon Agreements") dated as of January 13, 2003 by
and among MAI Systems Corporation, the ("Company"), and the Holders pursuant to
which the Holders are acquiring certain shares of Common Stock of the Company
and may purchase other securities of the Company at a later date pursuant to a
Warrant Agreement of even date. In order to induce the Holders to purchase the
Registrable Securities, the Company has agreed to provide the registration
rights set forth in this Agreement for the benefit of the Holders. The execution
and delivery of this Agreement is called for in the MAI Amendment No. Three.

         The parties hereby agree as follows:

         1.       CERTAIN DEFINITIONS.

                  As used in this Agreement, the following terms shall have the
following respective meanings:

                  (a)      AFFILIATE of a specified Person means any other
Person that directly, or indirectly through one or more intermediates, controls,
is controlled by or is under common control with the Person specified, or who
holds or beneficially owns 50% or more of the equity interest in the Person
specified or 50% or more of the voting securities of the Person specified. A
managed account of a Person is also an Affiliate of such Person.

                  (b)      COMMISSION means the Securities and Exchange
Commission.

                  (c)      COMPANY means MAI Systems Corporation or any
successor to it or to its business.

                  (d)      COMMON STOCK means (except where the context
otherwise indicates) the Common Stock of the Company, par value $0.01 per share,
as constituted on its original date of issue by the Company, and any capital
stock into which such Common Stock may thereafter be changed, and shall also
include (i) capital stock of the Company of any other class (regardless of how
denominated) issued to the holders of shares of any Common Stock upon any
reclassification thereof which is also not preferred as to dividends or
liquidation over any other class of stock of the Company and which is not
subject to redemption and (ii) shares of common stock of any successor
corporation, acquiring corporation or Constituent Corporation (as defined in the
Warrant Agreement).

                  (e)      CONTINUOUSLY EFFECTIVE means, with respect to a
specified registration statement, that it shall not cease to be effective and
available for transfers of Registrable Securities thereunder for longer than any
forty-five (45) consecutive Business Days, during

                                        2

<PAGE>

which time the Company shall not be permitted to call the Warrants, prior to the
Expiration Date.

                  (f)      DEMAND REGISTRATION shall have the meaning set forth
in Section 2(c).

                  (g)      DEMANDING HOLDERS shall have the meaning set forth in
Section 2(c).

                  (h)      EXCHANGE ACT means the Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission promulgated
thereunder.

                  (i)      EXPIRATION DATE means the later of February 1, 2010,
approximately the seventh anniversary of the date of this Agreement, and the
date the Company's 11% Subordinated Notes, as amended, have been repaid in full.

                  (j)      HOLDERS shall have the meaning set forth in the first
paragraph hereof.

                  (k)      PERSON means any individual, corporation,
partnership, joint venture, association, joint-stock company, limited liability
company, trust, unincorporated organization or government or other agency or
political subdivision thereof.

                  (l)      PIGGYBACK REGISTRATION shall have the meaning set
forth in Section 2(b)(i).

                  (m)      REGISTRABLE SECURITIES means any shares of Common
Stock of the Company acquired pursuant to the Canyon Agreements or any Warrant
Shares (as defined below) which may be acquired and owned by a Holder, or any
securities received by a Holder in exchange for such securities, and any other
Shares of the Company held by the Holders on the date hereof or Shares received
in exchange therefor. As to any particular Registrable Securities, such
securities shall cease to be Registrable Securities when (x) such securities
shall have been disposed of pursuant to an effective registration statement, (y)
such securities shall have been transferred to any Person other than the Holders
pursuant to Rule 144 (or any successor provision) or shall be transferable
pursuant to paragraph (k) thereof (or any successor provision) under the
Securities Act, or (z) they shall have ceased to be held by the Holders or any
Affiliate of the Holders or any Transferee of the Holders or their Affiliates.

                  (n)      REGISTRATION EXPENSES means all expenses incident to
the performance of or compliance with the registration rights granted herein,
including, without limitation, all registration, filing, listing and NASD fees,
all fees and expenses of complying with securities or blue sky laws, all word
processing, duplicating and printing expenses, messenger and delivery expenses,
the fees and expenses of the Company's counsel, the fees and expenses of one
counsel for the Selling Holders chosen by a majority vote of them, the fees and
expenses of the Company's independent public accountants, including the expenses
of any special audits or "cold comfort" letters required by or incident to such
performance and compliance.

                  (o)      SECURITIES ACT means the Securities Act of 1933, as
amended, or any successor statute thereto, and the rules and regulations of the
Securities and Exchange Commission promulgated thereunder, all as the same shall
be in effect at the time.

                                        3

<PAGE>

                  (p)      SELLING HOLDERS means those Holders who have
requested registration pursuant to Section 2(b) hereof and who are selling
securities thereunder.

                  (q)      SHARES means the Company's common stock, as
constituted on the date hereof, or any stock or other securities, for which such
common stock shall have been exchanged, or any stock or other securities
resulting from any reclassification of such Shares.

                  (r)      TRANSFEREE shall mean the first holder of Registrable
Securities by a transfer from a Holder or an Affiliate of a Holder provided,
however, that a Person acquiring such Registrable Securities pursuant to a
transfer under an effective registration statement or pursuant to a sale under
Rule 144 shall not be a Transferee.

                  (s)      VIOLATION shall have the meaning set forth in Section
6(a).

                  (t)      CANYON AGREEMENTS means the Canyon Agreements, dated
as of January _____, 2003 between the Company and the Warrant Holders listed
therein.

                  (u)      WARRANTS shall mean any warrants issued pursuant to
the Canyon Agreements.

                  (v)      WARRANT SHARES shall mean the Shares of Company
Common Stock and other securities issuable upon exercise of the Warrants.

         2.       REGISTRATION RIGHTS.

                  (a)      PIGGYBACK REGISTRATION RIGHTS. At any time after the
execution of this Agreement, if the Company proposes to register any Common
Stock for sale solely for cash, either for its own account or for the account of
a stockholder or stockholders (a "Company Registration"), then the Company shall
give the Holder written notice of its intention to do so and of the intended
method of sale (the "Registration Notice") not fewer than 15 days prior to the
anticipated filing date of the registration statement effecting such Company
Registration. The Holder may request inclusion of any Registrable Shares in such
Company Registration by delivering to the Company, within 10 days after receipt
of the Registration Notice, a written notice (the "Piggyback Notice") stating
the number of Registrable Shares proposed to be included and that such shares
are to be included in the Company Registration only on the same terms and
conditions as the shares of Common Stock otherwise being sold under such
Registration. The Company shall use its reasonable efforts to cause all
Registrable Shares specified in the Piggyback Notice to be included in the
Company Registration and any related offering, all to the extent requisite to
permit the sale by the Holder of such Registrable Shares in accordance with the
method of sale applicable to the other shares of Common Stock included in the
Company Registration.

                  (b)      LIMITATIONS ON PIGGYBACK REGISTRATIONS. The Company's
obligation to include Registrable Shares in the Company Registration pursuant to
Section 2(a) shall be subject to the following limitations: The Company shall
not be obligated to include any Registrable Shares in a registration statement
(i) filed on Form S-4 or Form S-8 or such other similar successor forms then in
effect under the Securities Act, (ii) pursuant to which the Company is

                                        4

<PAGE>

offering to exchange its own securities, or (iii) relating to dividend
reinvestment plans. There is no limit on the number of Piggyback Registrations
which may be requested hereunder.

                  (c)      DEMAND REGISTRATION.

                           (i)      If the Holders of at least 30% of the
         Registrable Securities make a written request to the Company (the
         "Demanding Holders"), the Company shall cause there to be filed with
         the Commission a registration statement meeting the requirements of the
         Securities Act (a "Demand Registration"), and each Demanding Holder
         shall be entitled to have included therein all or such number of such
         Demanding Holder's Registrable Securities, as the Demanding Holder
         shall request in writing. Any request made pursuant to this Section2(c)
         shall be addressed to the attention of the Secretary of the Company,
         and shall specify the number of Registrable Securities to be
         registered, the intended methods of disposition thereof and that the
         request is for a Demand Registration pursuant to this Section 2(c).

                           (ii)     Whenever the Company shall have received a
         demand pursuant to Section 2(c) to effect the registration of any
         Registrable Securities, the Company shall promptly give written notice
         of such proposed registration to all Holders. Any Holder may, within
         twenty (20) days after receipt of such notice, request in writing that
         all of such Holder's Registrable Securities, or any portion thereof
         designated by such Holder, be included in the registration.

                           (iii)    Following receipt of a request for a Demand
         Registration, the Company shall:

                                    (1)      File the registration statement
                           with the Commission as promptly as practicable, and
                           shall use the Company's best efforts to have the
                           registration declared effective under the Securities
                           Act as soon as reasonably practicable, in each
                           instance giving due regard to the need to prepare
                           current financial statements, conduct due diligence
                           and complete other actions that are reasonably
                           necessary to effect a registered public offering.

                                    (2)      Use the Company's best efforts to
                           keep the Demand Registration Statement Continuously
                           Effective for up to two hundred seventy (270) days or
                           until such earlier date as of which all the
                           Registrable Securities under the Demand Registration
                           Statement shall have been disposed of in the manner
                           described in the Registration Statement, or such
                           earlier time as the Company would not have any
                           obligation to include the Registrable Securities that
                           have not been disposed of in the manner described in
                           the Registration Statement. Notwithstanding the
                           foregoing, if for any reason the effectiveness of a
                           registration pursuant to this Section 2(c) is
                           suspended the foregoing period shall be extended by
                           the aggregate number of days of such suspension or
                           postponement.

                                        5

<PAGE>

                           (iv)     The Company shall be obligated to effect no
         more than a total of one Demand Registration, and only if the Company
         is then eligible to use Form S-3 or its equivalent, and if the
         reasonably anticipated aggregate gross proceeds to the Holders shall
         exceed $1,000,000. For purposes of the preceding sentence, the
         registration shall not be deemed to have been effected (i) unless a
         registration statement with respect thereto has become effective, (ii)
         if after such registration statement has become effective, such
         registration or the related offer, sale or distribution of Registrable
         Securities thereunder is interfered with by any stop order, injunction
         or other order or requirement of the Commission or other governmental
         agency or court for any reason not attributable to the Selling Holders
         and such interference is not thereafter eliminated. The Company shall
         not be obligated to enter into an underwriting agreement in connection
         with a Demand Registration hereunder. If the Company shall have
         complied with its obligations under this Agreement, a right to a Demand
         Registration pursuant to this Section 2(c) shall be deemed to have been
         satisfied upon the earlier of (i) the date as of which all of the
         Registrable Securities included therein shall have been disposed of
         pursuant to the Registration Statement, and (ii) the date as of which
         such Demand Registration shall have been Continuously Effective for a
         period of two hundred seventy (270) days. Any Demand Registration
         Statement which, after filing with the Commission is withdrawn by the
         Holders, shall be deemed to have been effective in determining the
         number of Demand Registrations the Company is obligated to effect
         hereunder.

                  (d)      REGISTRATION STATEMENT FORM. The Company may, if
permitted by law, effect any registration requested under Section 2 by the
filing of a registration statement on Form S-3 (or any successor or similar
short-form registration statement).

                  (e)      EXPENSES. The Company shall pay all Registration
Expenses incurred in connection with the registration of Registrable Securities
pursuant to Section 2.

                  (f)      EFFECTIVE REGISTRATION STATEMENT. The registration
requested pursuant to Section 2 shall not be deemed to have been effected unless
it has become effective with the Commission, provided, however, that a
registration which does not become effective after the Company has filed a
registration statement with respect thereto with the Commission solely by reason
of the Demanding Holders failing to proceed with the registration shall be
deemed to have been effected by the Company in satisfaction of the Company's
obligation to register Registrable Securities pursuant to a Demand Registration,
unless the Demanding Holders reimburse the Company for all of its costs and
expenses incurred in connection with such registration statement.
Notwithstanding the foregoing, a registration statement will not be deemed to
have been effected if (i) after it has become effective with the Commission,
such registration is interfered with by any stop order, injunction or other
order or requirement of the Commission or other governmental agency or any court
proceeding for any reason other than a misrepresentation or omission by the
Holders or (ii) the conditions to closing specified in the purchase agreement or
underwriting agreement entered into in connection with such registration are not
satisfied, other than by reason of some act or omission or failure to agree to
close by a Selling Holder.

                  (g)      CONFLICTING INSTRUCTIONS FROM HOLDERS. (i) The
Company may rely and shall be protected in relying upon any resolution,
certificate, opinion, request, communication, demand, receipt or other paper or
document in good faith believed by it to be genuine and to

                                        6

<PAGE>

have been signed or presented by the proper party or parties. The Company may
act in reliance upon the advice of its counsel in reference to any matter in
connection with this Agreement and shall not incur any liability for any action
taken in good faith in accordance with such advice.

                           (ii)     In the event the Company receives
         conflicting instructions regarding any action to be taken or withheld
         hereunder, the Company may suspend further action relating to such
         action until such time as the conflicting instructions are resolved by
         the parties giving the same or until the Company is instructed to take
         or withhold the requested action by a final order from which no appeal
         may be taken issued by a court of competent jurisdiction.

         3.       REGISTRATION PROCEDURES.

                  (a)      Whenever the Company is required to effect the
registration of any Registrable Securities under the Securities Act as provided
in Section 2, the Company, as expeditiously as possible and subject to the terms
and conditions herein, will:

                           (i)      prepare and file with the Commission the
         requisite registration statement to effect such registration and use
         its best efforts to cause such registration to become effective;

                           (ii)     prepare and file with the Commission such
         amendments and supplements to such registration statement and the
         prospectus used in connection therewith as may be necessary to keep
         such registration statement Continuously Effective and to comply with
         the provisions of the Securities Act with respect to the disposition of
         all securities covered by such registration statement until such time
         as all of such securities have been disposed of in accordance with the
         intended methods of disposition by the Selling Holders thereof set
         forth in such registration statement or, if earlier, until the
         Expiration Date;

                           (iii)    furnish to the Selling Holders such number
         of conformed copies of such registration statement and of each such
         amendment and supplement thereto (in each case including all exhibits),
         such number of copies of the prospectus contained in such registration
         statement (including each preliminary prospectus and any summary
         prospectus) and any other prospectus filed under the Securities Act, in
         conformity with the requirements of the Securities Act, and such other
         documents, as the Selling Holders may reasonably request;

                           (iv)     use its best efforts to register or qualify
         all Registrable Securities covered by such registration statement under
         such other United States state securities or blue sky laws of such
         jurisdictions as the Selling Holders shall reasonably request, to keep
         such registration statement qualification in effect for so long as such
         registration remains in effect, and take any other action which may be
         reasonably necessary or advisable to enable the Selling Holders to
         consummate the disposition in such jurisdictions of the securities
         owned by the Selling Holders, except that the Company shall not for any
         such purpose be required to (a) qualify generally to do business as a
         foreign corporation in any jurisdiction wherein it would not but for
         the requirements of

                                        7

<PAGE>

         this subdivision (iv) be obligated to be so qualified, (b) subject
         itself to taxation in any such jurisdiction or (c) consent to general
         service of process in any such jurisdiction;

                           (v)      immediately notify the Selling Holders at
         any time when a prospectus relating thereto is required to be delivered
         under the Securities Act, of the happening of any event as a result of
         which the prospectus included in such registration statement, as then
         in effect, includes an untrue statement of a material fact or omits to
         state any material fact required to be stated therein or necessary to
         make the statements therein not misleading in the light of the
         circumstances under which they were made, and at the request of the
         Selling Holders promptly prepare and furnish to the Selling Holders a
         reasonable number of copies of a supplement to or an amendment of such
         prospectus as may be necessary so that, as thereafter delivered to the
         purchasers of such securities, such prospectus shall not 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 not misleading in the light of the circumstances under which
         they were made;

                           (vi)     otherwise use its best efforts to comply
         with all applicable rules and regulations of the Commission, and make
         available to its security holders, as soon as reasonably practicable,
         an earnings statement covering the period of at least twelve months,
         but not more than eighteen months, beginning with the first full
         calendar month after the effective date of such registration statement,
         which earnings statement shall satisfy the provisions of Section 11(a)
         of the Securities Act, and not file any amendment or supplement to such
         registration statement or prospectus to which the Selling Holders shall
         have reasonably objected in writing on the grounds that such amendment
         or supplement does not comply in all material respects with the
         requirements of the Securities Act or of the rules or regulations
         thereunder, having been furnished with a copy thereof (other than with
         respect to a pricing amendment) at least two business days prior to the
         filing thereof;

                           (vii)    provide a transfer agent and registrar for
         all Registrable Securities covered by such registration statement not
         later than the effective date of such registration statement; and

                           (viii)   use its best efforts to list all Registrable
         Securities covered by such registration statement on any securities
         exchange on which any of the Registrable Securities are then listed.

                  (b)      As a condition of these Registration Rights, the
Company may require the Demanding Holders, at their own expense, to furnish the
Company with such information and undertakings regarding such Holders and the
distribution of such securities as the Company may from time to time reasonably
request in writing, and the Holders, by their execution hereof, agree to provide
such information and make such undertakings as are requested.

                  (c)      The Selling Holders agree (A) that upon receipt of
any notice from the Company of the happening of any event of the kind described
in subdivision (vi) of Section 3(a), the Selling Holders will forthwith
discontinue their disposition of Registrable Securities pursuant to the
registration statement relating to such Registrable Securities until the Selling
Holders'

                                        8

<PAGE>

receipt of the copies of the supplemented or amended prospectus contemplated by
subdivision (vi) of Section 3(a) and, if so directed by the Company, will
deliver to the Company all copies, other than permanent file copies, then in the
Selling Holders' possession of the prospectus relating to such Registrable
Securities current at the time of receipt of such notice and (B) that they will
immediately notify the Company, at any time when a prospectus relating to the
registration of such Registrable Securities is required to be delivered under
the Securities Act, of the happening of any event as a result of which
information previously furnished by the Selling Holders to the Company for
inclusion in such prospectus contains an untrue statement of a material fact or
omits to state any material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the circumstances
under which they were made.

                  (d)      Notwithstanding anything in this agreement to the
contrary, the Company will not be required to file such a registration statement
if it receives an opinion of counsel in form and substance reasonably
satisfactory to the Selling Holders, or counsel to the Selling Holders, to the
effect that the sale of the Registrable Securities in the manner contemplated by
the Selling Holders may be effected without registration regardless of the
identity or status of the buyer(s) of such Registrable Securities.

         4.       PREPARATION, REASONABLE INVESTIGATION.

                  In connection with the preparation and filing of each
registration statement under the Securities Act, the Company will give the
Selling Holders, the underwriters, if any, and their respective counsel and
accountants, the opportunity to participate in the preparation of such
registration statement, each prospectus included therein or filed with the
Commission and each amendment thereof or supplement thereto, and will give each
of them such access to its books and records and such opportunities to discuss
the business of the Company with its officers and the independent public
accountants who have certified its financial statements as shall be necessary,
in the reasonable opinion of the Selling Holders' and such underwriters'
respective counsel, to conduct a reasonable investigation within the meaning of
the Securities Act.

         5.       INDEMNIFICATION; CONTRIBUTION. If any Registrable Securities
are included in a registration statement under this Agreement:

                  (a)      To the extent permitted by applicable law, the
Company shall indemnify and hold harmless each Selling Holder, each Person, if
any, who controls such Selling Holder within the meaning of the Securities Act,
and each officer, director, partner, and employee of such Selling Holder and
such controlling Person, against any and all losses, claims, damages,
liabilities and expenses (joint or several), including reasonable attorneys'
fees and disbursements and expenses of investigation, incurred by such party
pursuant to any actual or threatened action, suit, proceeding or investigation,
or to which any of the foregoing Persons may become subject under the Securities
Act, the Exchange Act or other federal or state laws, insofar as such losses,
claims, damages, liabilities and expenses arise out of or are based upon any of
the following statements, omissions or violations (collectively a "Violation"):

                                        9

<PAGE>

                           (i)      Any untrue statement or alleged untrue
         statement of a material fact contained in such registration statement,
         including any preliminary prospectus or final prospectus contained
         therein, or any amendments or supplements thereto;

                           (ii)     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; or

                           (iii)    Any violation or alleged violation by the
         Company of the Securities Act, the Exchange Act, any applicable state
         securities law or any rule or regulation promulgated under the
         Securities Act, the Exchange Act or any applicable state securities
         law; provided, however, that the indemnification required by this
         Section 6(a) shall not apply to amounts paid in settlement of any such
         loss, claim, damage, liability or expense if such settlement is
         effected without the consent of the Company (which consent shall not be
         unreasonably withheld), nor shall the Company be liable in any such
         case for any such loss, claim, damage, liability or expense to the
         extent that it arises out of or is based upon a Violation which occurs
         in reliance upon and in conformity with written information furnished
         to the Company by the indemnified party expressly for use in connection
         with such registration; provided, further, that the indemnity agreement
         contained in this Section 6 shall not apply to any underwriter to the
         extent that any such loss is based on or arises out of an untrue
         statement or alleged untrue statement of a material fact, or an
         omission or alleged omission to state a material fact, contained in or
         omitted from any preliminary prospectus if the final prospectus shall
         correct such untrue statement or alleged untrue statement, or such
         omission or alleged omission, and a copy of the final prospectus has
         not been sent or given to such person at or prior to the confirmation
         of sale to such person if such underwriter was under an obligation to
         deliver such final prospectus and failed to do so. The Company shall
         also indemnify underwriters, selling brokers, dealer managers and
         similar securities industry professionals participating in the
         distribution, their officers, directors, agents and employees and each
         person who controls such persons (within the meaning of Section 15 of
         the Securities Act or Section 20 of the Exchange Act) to the same
         extent as provided above with respect to the indemnification of the
         Selling Holders.

                  (b)      To the extent permitted by applicable law, each
Selling Holder shall indemnify and hold harmless the Company, each of its
directors, each of its officers who shall have signed the registration
statement, each Person, if any, who controls the Company within the meaning of
the Securities Act, any other Selling Holder, any controlling Person of any such
other Selling Holder and each officer, director, partner, and employee of such
other Selling Holder and such controlling Person, against any and all losses,
claims, damages, liabilities and expenses (joint and several), including
reasonable attorneys' fees and disbursements and expenses of investigation,
incurred by such party pursuant to any actual or threatened action, suit,
proceeding or investigation, or to which any of the foregoing Persons may
otherwise become subject under the Securities Act, the Exchange Act or other
federal or state laws, insofar as such losses, claims, damages, liabilities and
expenses arise out of or are based upon any Violation, in each case to the
extent (and only to the extent) that such Violation occurs in reliance upon and
in conformity with written information furnished by such Selling Holder
expressly for use in connection with such registration; provided, however, that
(x) the indemnification required by this Section 6(b) shall

                                       10

<PAGE>

not apply to amounts paid in settlement of any such loss, claim, damage,
liability or expense if settlement is effected without the consent of the
relevant Selling Holder of Registrable Securities, which consent shall not be
unreasonably withheld, and (y) in no event shall the amount of any indemnity
under this Section 6(b) exceed the gross proceeds from the applicable offering
received by such Selling Holder.

                  (c)      Promptly after receipt by an indemnified party under
this Section 6 of notice of the commencement of any action, suit, proceeding,
investigation or threat thereof made in writing for which such indemnified party
may make a claim under this Section 6, such indemnified party shall deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain its own counsel at its own expense except as provided
below. The failure to deliver written notice to the indemnifying party within a
reasonable time following the commencement of any such action, if prejudicial to
its ability to defend such action, shall relieve such indemnifying party of any
liability to the indemnified party under this Section 6 but shall not relieve
the indemnifying party of any liability that it may have to any indemnified
party otherwise than pursuant to this Section 6. Any fees and expenses incurred
by the indemnified party (including any fees and expenses incurred in connection
with investigating or preparing to defend such action or proceeding) shall be
paid to the indemnified party, as incurred, within sixty (60) 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, but in such event such amounts shall be refunded). Any such
indemnified party shall have the right to employ separate counsel in any such
action, claim or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be the expenses of such indemnified
party unless (i) the indemnifying party has agreed to pay such fees and expenses
or (ii) the indemnifying party shall have failed to promptly assume the defense
of such action, claim or proceeding or (iii) the named parties to any such
action, claim or proceeding (including any impleaded parties) include both such
indemnified party and the indemnifying party, and such indemnified party shall
have been advised by counsel that there may be one or more legal defenses
available to it which are different from or in addition to those available to
the indemnifying party and that the assertion of such defenses would create a
conflict of interest such that counsel employed by the indemnifying party could
not faithfully represent the indemnified party (in which case, if such
indemnified party notifies the indemnifying party in writing that it elects to
employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such
action, claim or proceeding on behalf of such indemnified party, it being
understood, however, that the indemnifying party shall not, in connection with
any one such action, claim or proceeding or separate but substantially similar
or related actions, claims or proceedings in the same jurisdiction arising out
of the same general allegations or circumstances, be liable for the reasonable
fees and expenses of more than one separate firm of attorneys (together with
appropriate local counsel) at any time for all such indemnified parties, unless
in the reasonable judgment of such indemnified party a conflict of interest may
exist between such indemnified party and any other of such indemnified parties
with respect to such action, claim or proceeding, in which event the
indemnifying party shall be obligated to pay the reasonable fees and expenses of
such additional counsel or counsels). No indemnifying party shall be liable to
an indemnified

                                       11

<PAGE>

party for any settlement of any action, proceeding or claim without the written
consent of the indemnifying party, which consent shall not be unreasonably
withheld.

                  (d)      If the indemnification required by this Section 6
from the indemnifying party is unavailable to an indemnified party hereunder in
respect of any losses, claims, damages, liabilities or expenses referred to in
this Section 6:

                           (i)      The indemnifying party, in lieu of
         indemnifying such indemnified party, shall contribute to the amount
         paid or payable by such indemnified party as a result of such losses,
         claims, damages, liabilities or expenses in such proportion as is
         appropriate to reflect the relative fault of the indemnifying party and
         indemnified parties in connection with the actions which resulted in
         such losses, claims, damages, liabilities or expenses, as well as any
         other relevant equitable considerations. The relative fault of such
         indemnifying party and indemnified parties shall be determined by
         reference to, among other things, whether any Violation has been
         committed by, or relates to information supplied by, such indemnifying
         party or indemnified parties, and the parties' relative intent,
         knowledge, access to information and opportunity to correct or prevent
         such Violation. The amount paid or payable by a party as a result of
         the losses, claims, damages, liabilities and expenses referred to above
         shall be deemed to include, subject to the limitations set forth in
         Section 6(a) and Section 6(b), any legal or other fees or expenses
         reasonably incurred by such party in connection with any investigation
         or proceeding.

                           (ii)     The parties hereto agree that it would not
         be just and equitable if contribution pursuant to this Section 6(d)(ii)
         were determined by pro rata allocation or by any other method of
         allocation which does not take into account the equitable
         considerations referred to in Section 6(d)(i). 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.

                  (e)      If indemnification is available under this Section 6,
the indemnifying parties shall indemnify each indemnified party to the full
extent provided in this Section 6 without regard to the relative fault of such
indemnifying party or indemnified party or any other equitable consideration
referred to in Section 6(d).

                  (f)      The obligations of the Company and the Selling
Holders of Registrable Securities under this Section 6 shall survive the
completion of any offering of Registrable Securities pursuant to a registration
statement under this Agreement, and otherwise.

         6.       COVENANTS OF THE COMPANY. The Company hereby agrees and
covenants as follows:

                  The Company shall file as and when applicable, on a timely
basis, all reports required to be filed by it under the Exchange Act. If the
Company is not required to file reports pursuant to the Exchange Act, upon the
request of any Holder of Registrable Securities, the Company shall make publicly
available the information specified in subparagraph (c)(2) of Rule

                                       12

<PAGE>

144 of the Securities Act, and take such further action as may be reasonably
required from time to time and as may be within the reasonable control of the
Company, to enable the Holders to transfer Registrable Securities to a
Transferee without registration under the Securities Act within the limitation
of the exemptions provided by Rule 144 under the Securities Act or any similar
rule or regulation hereafter adopted by the Commission.

         7.       MISCELLANEOUS.

                  7.1      SPECIFIC PERFORMANCE. The parties hereto acknowledge
that there may be no adequate remedy at law if any party fails to perform any of
its obligations hereunder and that each party may be irreparably harmed by any
such failure, and accordingly agree that each party, in addition to any other
remedy to which it may be entitled at law or in equity, may be entitled to
compel specific performance of the obligations of any other party under this
Agreement in accordance with the terms and conditions of this Agreement.

                  7.2      NOTICES. All notices, requests, claims, demands,
waivers and other communications required or permitted hereunder shall be in
writing and shall be deemed to have been duly given when delivered by hand, if
delivered personally by courier, or three days after being deposited in the mail
(registered or certified mail, postage prepaid, return receipt requested) as
follows:

                           (i)      The Holders at the addresses indicated on
         the signature page hereof with a copy to Canyon Capital Management:

                                    c/o Canyon Partners Incorporated
                                    9665 Wilshire Boulevard
                                    Suite 200
                                    Beverly Hills, CA 90212

                           (ii)     Company:

                                    MAI Systems Corporation
                                    9600 Jeronimo Road
                                    Irvine, California 92718
                                    Attention: General Counsel
                                    Telecopy No. (949) 598-6606

or to such other address as any party may have furnished to the other in writing
in accordance herewith, except that notices of change of address shall be
effective only upon receipt.

                  7.3      LAW GOVERNING. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT
GIVING EFFECT TO PRINCIPLES OF CONFLICT OF LAWS.

                  7.4      ATTORNEYS' FEES. In any action or proceeding brought
to enforce any provision of this Agreement, or where any provision hereof is
validly asserted as a defense, the successful party shall be entitled to recover
reasonable attorneys' fees (including any fees incurred in any appeal) in
addition to its costs and expenses and any other available remedy.

                                       13

<PAGE>

                  7.5      HEADINGS. The descriptive headings of the several
Sections and paragraphs of this Agreement are inserted for convenience only, and
do not constitute a part of this Agreement and shall not affect in any way the
meaning or interpretation of this Agreement.

                  7.6      ENTIRE AGREEMENT; AMENDMENTS. This Agreement and the
other writings referred to herein or delivered pursuant hereto which form a part
hereof contain the entire understanding of the parties with respect to its
subject matter. This Agreement supersedes all prior agreements and
understandings between the parties with respect to its subject matter. This
Agreement may be amended and the observance of any term of this Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively) only by a written instrument duly executed by the Company and the
Holders. Each holder of any Registrable Securities at the time or thereafter
outstanding shall be bound by an amendment or waiver authorized by this Section
8.6, whether or not any such Registrable Securities shall have been marked to
indicate such consent.

                  7.7      ASSIGNABILITY. This Agreement shall be binding upon
and inure to the benefit of the respective successors and assigns of the parties
hereto provided, however, that the Registration Rights hereunder shall only be
available to the Holders, their Affiliates and to their Transferees.

                  7.8      COUNTERPARTS. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.

                  7.9      VALIDITY, DUE AUTHORIZATION. By its execution hereof,
the Company represents and warrants that it has the corporate power to execute,
deliver and perform the terms and provisions of this Agreement and that it has
taken all appropriate and necessary corporate action to authorize the
transactions contemplated hereby and the execution, delivery and performance of
this Agreement.

                                                    MAI Systems Corporation

                                                    By: ________________________

                                       14

<PAGE>

INVESTORS:

Canyon Value Realization Fund, L.P.,         Address:
a California limited partnership             Canyon Value Realization Fund, L.P.
                                             c/o Canyon Partners Incorporated
By:      Canpartners Investments III, L.P.,  9665 Wilshire Boulevard
         a California limited partnership,   Suite 200
         its general partner                 Beverly Hills, CA 90212

By:      Canyon Capital Advisors LLC,        310/247-2700 (O)
         a Delaware limited liability        310/247-2701 (F)
         company,
         its general partner

By:      Canpartners Incorporated,
         a California corporation,
         its general partner

By:      ______________________
         Name:
         Title:

The Canyon Value Realization Fund            Address:
(Cayman), Ltd.                               The Canyon Value Realization Fund
                                             (Cayman), Ltd.
By:      MeesPierson (Cayman) Limited,       c/o MeesPierson (Cayman) Limited
         its Administrator                   P.O. Box 2003
                                             British American Center, Phase 3
                                             Dr. Roy's Drive
By:      ______________________              Grand Cayman, B.W.I.
         Name:
         Title:                              809/949-7942 (O)
                                             809/949-8340 (F)

GRS Partners II                              Address:

By:      Grosvenor Capital Management L.P.,  GRS Partners II
         its Administrator                   c/o Grosvenor Capital Management,
                                             L.P.
                                             333 West Wacker Drive
By:      Grosvenor Capital Management, Inc., Suite 1600
         its general partner                 Chicago, Illinois  60606

By:      ________________________            312/263-7777 (O)
         Name:                               312/782-4759 (F)
         Title:

                                       15

<PAGE>

CPI Securities L.P.,                         Address:
a California limited partnership             CPI Securities L.P.
                                             c/o Canyon Partners Incorporated
By:      Canpartners Incorporated,           9665 Wilshire Boulevard
         a California corporation,           Suite 200
         its general partner                 Beverly Hills, CA 90212

                                             310/247-2700 (O)
By:      ________________________            310/247-2701 (F)
         Name:
         Title:

                                       16

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